Kickstart It

Zach Braff Can’t Legally Share His Multimillion Dollar Movie Deal With Kickstarter Donors

Dawww, we can't stay mad at these two. (Photo: Getty)

Poor Zach Braff. He’s catching so much guff, when all he really wants to do is strike the perfect balance between quirky and relatable.

He crowdfunded his latest film, Wish I Was Here, which we gather is like a male version of Raising Helen with some slight tweaks. It also stars Kate Hudson. It sounds nice enough.

But everyone’s pissed about the movie’s Kickstarter campaign. Mr. Braff is a big star, his detractors have argued. What’s he doing asking strangers for money when he’s got the connections to get big studios to invest in his movie?  Read More

IP Uh Oh

Facebook’s Cold IPO Calculus: Protecting Insiders Over Shareholders, Obscuring Risks

Zuck. (Photo: scrapetv.com)

Yesterday over drinks, we asked an angel investor if he thought Gilt Groupe would actually go public this quarter or next year, as planned. Fat chance given the post-Facebook IPO market, he replied. (Stronger language was used.)

Today, Bloomberg offers a must-read, in-depth investigation into just how cynical Facebook was in the lead-up to the IPO, including obscuring material information on risks demanded by the Securities and Exchange Commission. Those vulnerabilities, such as difficulties in monetizing mobile, decelerating revenue and dependence on Zynga, became painfully evident to shareholders who have watched what was supposed to be “the IPO of the Century,” drop in share price from $38 down to $19.69 as of this afternoon.  Read More

The Equity of the Crowds

The JOBS Act, Which Rolls Back SEC Rules In Order to Help Startups Crowdfund, Passes in the House

JOBS Act supports via Angel List

Ready your startups, the early stage investing climate is about to go into overdrive. This afternoon, the JOBS Act (or Jumpstart Our Business Startups Act) passed in the House with an overwhelming vote of 380-41. Next, the bill moves to President Obama, who is expected to sign it into law.

It’s been a bit of a bumpy ride. The JOBS Act originally passed in the House a few weeks ago with a 390-23 vote a couple weeks ago. The Senate’s version of the bill, called the CROWDFUND Act (or Capital Raising Online While Deterring Fraud and Unethical Non-Disclosure Act), added a number of safeguards for investors and passed last week 73-26. The JOBS Act was then revised to reconcile with the Senate’s bill, which is why the final version had to move back to the House for another vote.  Read More

Secondary Markets

SEC’s Yearlong Secondary Markets Investigation Reportedly Yields Charges Against SharesPost and Felix Investments [UPDATED]

Frank Mazzola

It looks like the Securities and Exchange Commission’s yearlong investigation into trading private shares on the secondary market may finally be coming to a close.

Yesterday afternoon, Bloomberg first reported that the SEC is preparing to bring civil charges against Felix Investments, a Wall Street broker-dealer perhaps best-known for its twin funds Facie Libre 1 and Facie Libre II–meaning face book in Latin. “The firm is expected to be accused of violating securities laws related to soliciting investors,” DealBook wrote in a follow-up, adding that Felix “aggressively accumulated” and actively promoted shares of companies like Facebook and Twitter, going as far as to cold-call Facebook employees to try to get them to sell.

The SEC is also reportedly “nearing a settlement” with SharesPost, an online platform for selling private shares.  “Regulators had expressed concern that SharesPost was not registered as a broker-dealer when it began facilitating trades in private company shares in 2009,” noted DealBook.  SecondMarket, a SharesPost competitor which registered as a broker-dealer early in its history, however, “is not the subject of an SEC inquiry,” spokesman Mark Murphy told Betabeat. Read More