Can The JOBS Act Jump-Start
March 31, 2012 by staff
Can The JOBS Act Jump-Start, Can the crowdfunding-focused Jumpstart Our Business Startups (JOBS) Act really spark entrepreneurship, economic growth and hiring? Rep. Patrick McHenry (R-N.C.), a staunch advocate of crowdfunding and contributor to the #FixYoungAmerica campaign to promote youth entrepreneurship, believes it can.
Businesses can’t raise money through crowdfunding in a meaningful way right now because of federal restrictions and red tape. McHenry wants to change that. A bill he introduced to near-unanimous support in the House became part of the foundation for the JOBS Act, which has been passed by Congress and awaits President Obama’s signature.
McHenry says he’s fed up with the pattern of entrepreneurs being forced to finance their projects through their own lines of credit, sometimes backed by the value of their homes. He sees two problems with this way of doing things: First, it can be difficult to get credit, and second, the value of many homes tanked during the financial crisis of 2007-2008, making mortgage-backed financing a much weaker option for capital-seeking entrepreneurs.
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