On April 5, 2012, I had the distinct honor of standing behind President Obama during the signing of the JOBS Act (Jumpstart Our Business Startups Act).
What brought me to the White House Rose Garden on this auspicious occasion? My company, CareCloud, born in the depths of the economic downturn, was celebrating its third anniversary. Despite the support enjoyed by CareCloud directly, a lack of venture capital returns over the prior 10 years had been seriously choking off the larger VC ecosystem, leading up to the signing of the JOBS Act, especially for early-stage companies. Venture firms were swimming upstream to later-stage rounds that were closer to initial public offerings in an attempt to shorten their investment time horizons. Deserving entrepreneurs were being starved of the resources they needed to build their companies.
After the signing, I was asked by PBS to debate a Columbia University law professor on the merits of the Act. During that debate, I argued that the time had come to reform the Securities & Exchange Acts of 1933 and 1934 given the amount of change the world had seen since that time. I argued that we needed to allow the world which had largely been shut off from investing, to participate. As Americans, we do not always relate to the fact that people in other parts of the world cannot easily invest in great companies, whether private or public.
The wisdom of the crowd, faster than the speed of SEC
As much as I believed in the JOBS Act, little did I realize how ready the world was to invest, especially in the areas of crowdfunding. In the early days after the Act, we saw portals like Kickstarter