We Need to Update the Definition of a VC, Here’s Why

by & filed under Capital Formation & Regulation, NVCA Blog.

Justin Field

Last week, NVCA sent a letter to the Securities and Exchange Commission (SEC) offering recommendations for how the agency could modernize the definition of “venture capital fund” to more accurately reflect the industry as it looks today. Why is this important? Because this definition governs which private funds can be Exempt Reporting Advisors (ERAs) and which must register with the SEC as Registered Investment Advisors (RIAs). (more…)

Let Banks Invest in Venture Capital Funds Once Again

by & filed under Capital Formation & Regulation, NVCA Blog.

Charlotte Savercool

NVCA is working to allow banks to invest in venture capital funds again. As part of this effort, we recently filed a comment letter proposing two solutions for how the various federal agencies can accomplish this priority while still adhering to the broader goals of the Volcker Rule. Through this post, our aim is to share some background on the current regulation and provide an overview of what our proposal seeks to accomplish and why. 

Before the Volcker Rule became the law of the land, banks served as an important source of capital for venture capital funds, particularly for smaller funds in emerging startup ecosystems. (more…)

Foreign Investment Bill and its Impact on the VC and Startup Ecosystem

by & filed under Capital Formation & Regulation, NVCA Blog.

Jeff Farrah

If you’re a VC with a foreign LP or have foreign co-investors, then you should know the law is about to change. 

Later this week, Congress is expected to pass legislation that will impact foreign investment into the venture and startup ecosystem in new ways. President Trump is expected to sign the Foreign Investment Risk Review Modernization Act (FIRRMA), as he chose to back the bill rather than move forward with China-specific restrictions. NVCA is pleased to see key changes in the final bill, but it still stands to affect VC funds with foreign limited partners and/or co-investors. We will continue to engage on your behalf and encourage you to be in touch with questions or comments. (more…)

Emerging Growth Companies Want to Go Public, The Question is When?

by & filed under Capital Formation & Regulation, NVCA Blog.

Heather Gates

Note from NVCA: We always encourage our members and industry partners to share their perspectives on industry issues. Heather Gates of Deloitte shares her views on the current IPO environment for venture-backed companies. NVCA remains engaged on capital market reforms to support small cap companies. We recently released a report with the U.S. Chamber of Commerce on policy reforms to encourage more public companies.


Recently, I had the pleasure of participating in the Stanford/NVCA Venture Capital Symposium along with Scott Kupor, Greg Rodgers, Jeff Thomas, Nizar Tahurni and Justin Field. Our panel, The Death of the IPO, focused on the trends in the volume of IPOs and the challenges and opportunities facing aspiring publicly traded companies.

Interestingly, within just the past week or so, we’ve seen a recent uptick in enterprise tech IPOs and companies in the media and fintech space going public or announcing plans. (more…)

A Proposal to Encourage More Public Companies – NVCA’s Perspective

by & filed under Capital Formation & Regulation, NVCA Blog, Public Policy.

Justin Field

I hope that you were able to read the press release NVCA sent out yesterday announcing the release of a proposal to encourage more U.S. public companies.  This effort builds off the success of the JOBS Act and is intended to make it more attractive to become and remain a public company.  We were pleased to partner with the U.S. Chamber of Commerce, the Biotechnology Innovation Organization, Nasdaq, Equity Dealers of America and several other organizations to put this package together, and we look forward to working with this coalition to get these ideas passed.

Capital markets reform and reviving the Initial Public Offering (IPO) is one of our top priorities at NVCA.  We believe the blueprint we just released can reverse the trend of the dwindling number of public companies in the U.S.  We also hope this report can spark a further conversation on these issues among our membership as we continue this important work.  (more…)

Moving More EGCs from the On-Ramp to IPOs

by & filed under Capital Formation & Regulation, NVCA Blog, Public Policy.

Jennifer Connell Dowling

This past Monday, NVCA participated in the release of a new report aimed at improving access to public capital for startups and emerging growth companies. Entitled “From the On-Ramp to the Freeway: Refueling Job Creation and Growth by Reconnecting Investors with Small-Cap Companies,” the report follows up on the 2011 efforts of the IPO Task Force, whose “Rebuilding the IPO On-Ramp” report helped lead to the passage of the JOBS Act of 2012., NVCA Board Director Scott Kupor (Andreessen Horowitz) served as co-Chair of the new task force, while I provided policy guidance. (more…)

The SEC’s Proposed New Rules on General Solicitation

by & filed under Capital Formation & Regulation, NVCA Blog, Public Policy.

Jennifer Connell Dowling

Among the many bills packaged together in 2012 to form the JOBS Act was a measure that forced the Securities and Exchange Commission (SEC) to revisit its long-time ban on “general solicitation” – i.e. advertising – for private offerings.  Although it has taken the SEC more than a year to craft final rules lifting the ban, those new rules took effect on Sept. 23, 2013.

Throughout the legislative and regulatory phase of this debate, NVCA has kept a finger on the pulse of member opinion regarding this issue, and has found little interest in using the new general solicitation regime.  However, at its meeting in July of this year – the meeting at which the final rules were issued – the SEC asked for comment on additional proposed rules that deal with reporting requirements for firms that do generally solicit, as well as those that continue to operate under the “old” rules (no general solicitation.) (more…)

NVCA Board Member Ray Leach Testifies on Capital Formation

by & filed under Capital Formation & Regulation, NVCA Blog, Public Policy.

Jennifer Connell Dowling

Today, NVCA Board Member and JumpStart Inc CEO Ray Leach testified before the House of Representatives Subcommittee on Capital Markets and Government Sponsored Enterprises at a Hearing on “Reducing Barriers to Capital Formation, Part II” Following the passage of the JOBS Act, the Subcommittee continues to identify additional legal, regulatory,  and market impediments that are impacting capital formation, particularly for small and medium capitalized companies.  The venture capital community was invited to give a perspective on the existing state of the capital markets for our companies. (more…)