Montana crowdfunding will give businesses the opportunity to raise money in an alternative fashion, if a bill proposed becomes law. The internet has paved the way for businesses to raise the capital necessary to get operate.
Crowdfunding platforms allow entrepreneurs to raise smaller investments from larger groups of people. It’s a great way for state residents to start a business and for residents to invest in a business.’
House Bill 481 would allow crowdfunding with certain guidelines to protect Montana crowdfunding. Under this bill, a Montana investor or a business start-up would be able to solicit up to $1 million in capital from Montana investors, and be exempt from having to go through all the channels of registering a security.
The current bill passed 19 to 0 in committee, and 100 to 0 on the floor, so it’s in the second half of its process. There do not appear to be any major roadblocks although anything can happen, as with all new legislation. Montana crowdfunding supporters hope Governor Steve Bullock will sign the bill into law once it clears the legislature.
Beginning in July, if you have a business registered in Montana, you will be able to raise up to $1 million in capita, exempt from having to go through the formal process of traditional securities registration. There are caveats: No investor can invest more than $10,000 and all investors must be residing in Montana.
Montana crowdfunding will put the power to raise money – to help build a Montana business from the ground up – in the hands of regular state residents. We don’t have to be a registered security salesperson to know someone who is, or to have a lot of money to make a real difference for a small business.
Before the new Montana crowdfunding bill passed, it was illegal in Montana to use a similar model to raise money for a business.