This article discusses some of the challenges and benefits that crowdfunding presents for Smalll Businesses. On the one hand, they can accept funding approved by the SEC that they would otherwise not be able to accept. But on the other hand, challenges such as potentially not being able to accept institutional investment in the future, limit the net benefit that crowdfunding can offer.
Nathan, great article. I was interested to learn more about the equity funding issues and found an article that addresses the implementation of regulation crowdfunding. Regulation crowdfunding not only imposes limits on the amounts participating companies can solicit in a year, if a company that a taxpayer has invested in fails, the taxpayer may be able to take a worthless security loss under Sec. 165(g).
https://www.thetaxadviser.com/issues/2018/jan/introducing-us-equity-crowdfunding.html