Letter to Senator Orrin Hatch on the Finance Reform Bill
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Mr. Hatch,
I am worried that Senator Dodd’s new finance bill (AYO10306.xml)[4] will harm small business investing by angel investors by requiring all investors to have a minimum amount of capital, requiring startups to undergo an SEC review, and subjecting angels to burdensome regulation.
I’m not an angel investor, but as a small business owner I’ve used them over the years to give necessary liquidity to my fledgling businesses. Small businesses represent a sizable piece of the US economy, as I’m sure you’re aware. Yes, many of them fail, but that risk is already borne by the investors who knew what they were getting into, and the economy at large is largely insulated from their failures.
Federal oversight will add no additional protection (unless the SEC has a magic crystal ball that will indicate whether a business will succeed or fail), and will hamper creative startups who had to really “shop” their idea until they found an investor who “got it” (e.g., Google, Microsoft, Apple all represent risky startups of this kind).
Please see:
and:
For the US economy to become strong again, we need the kind of innovation and jobs that come from small businesses. Please leave small business regulation alone—it’s worked remarkably well, even in these tough times.
I hope you’ll work with Senator Dodd in repairing this bill in these areas.
Scott Wiersdorf
© 2010 Scott Wiersdorf