Startups Can Now Use Twitter to Gauge Investor Interest

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It’s great news for small business owners and startup founders alike, because the SEC (the US Securities and Exchange Commission) has just changed its rules pertaining to the use of social media by small businesses, for purposes other than small announcements that pertain to their finances. Startups will now be able to tweet to solicit interest from investors without fearing the related SEC regulations.

Also Read: Top 5 Social Media Tips For Startups

According to an article on Bloomberg.com startups are now able “to post a Twitter message about their stock or debt offering to gauge interest among potential investors”.

The announcement came from the SEC which has for the last years, shown a lot of interest in helping new small businesses use social media since it has become such a big part of corporate communication.

The SEC has cleared the way for startups attract investor interest… with a Tweet.

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Years ago, the SEC had allowed small businesses to use Facebook and Twitter for these purposes, as long as they inform investors to look there… the new rules open up many opportunities for small businesses who are “looking to raise as much as $50 million a year”. They are required though to include a link to a disclaimer that informs the reader that the company is not selling securities yet.