House passes two tech investment bills

House passes two tech investment bills
© Greg Nash

The House on Tuesday evening passed two bills aimed at improving conditions for startup investing.

The Fix Crowdfunding Act changes the rules around a certain regulatory exemption for crowdfunding. A 2012 law opened up the rules for crowdfunded investments, but Republicans say the rules still need to be tweaked. The bill was approved by a vote of 394-4.

ADVERTISEMENT

“These bills today are targeted fixes to restore the original spirit of the JOBS Act: To harness innovation and bring together millions of Americans with potential new businesses through crowdfunding,” Majority Leader Kevin McCarthy (R-Calif.) said in a floor statement.

The new crowdfunding rules went into effect earlier this year after being formally approved by the Securities and Exchange Commission in 2015.

Crowdfunding sites like Kickstarter and GoFundMe have become a mainstream way for inventors and creators to get funding for their projects. But making that model work in the highly regulated world of investing has proved more complicated.

The second bill would expand the legal limit on investors in venture funds doing early-stage funding that can help a company get off the ground — called angel investing — to 250 from 100. The legislation passed 388-9.

Both bills are part of a House GOP initiative focused on passing bills related to the tech industry and innovation in the months before November’s elections. Democrats have backed a similar initiative.

- Updated at 8:22 a.m. on Thursday