Chicago's 1871 reps to White House: Let startups crowdfund

Chicago's 1871 reps to White House: Let startups crowdfund

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By Paul Merrion   April 09, 2014

Founders of five startup companies from 1871, Chicago's high-tech incubator space, will make a plea for regulations allowing Web-based appeals to investors when they meet with Obama administration officials in Washington tomorrow at a White House “summit” on entrepreneurship.

“We've been waiting for more than a year to get the regulations done for Jobs Act crowdfunding,” 1871 CEO Howard Tullman said. “If they ask us for our opinion, that's a huge help for entrepreneurship.”

The bipartisan Jumpstart Our Business Startups Act, enacted two years ago, required the Securities and Exchange Commission to loosen restrictions on the use of websites to attract investors in small companies, within certain limits. But the SEC has not finalized a proposed 600-page crowdfunding regulation issued last fall.

Crowdfunding would allow startups to raise money from ordinary investors, instead of well-heeled venture capitalists or people they already know. “That's huge for young businesses, to be able to raise money they need without going through friends and family or angel investors,” Mr. Tullman said. “It's never been turned loose to be utilized.”

The other 1871 attendees accompanying Mr. Tullman include Feyi Olipade of CancerIQ Inc., Lotika Pai of Q-it Tech LLC, Corbett Kull of 640 Labs Inc., Canh Tran of Rippleshot and Rajesh Karmani of Zero Percent.

“I expect to see some valuable examples about how things are working for entrepreneurs elsewhere in the country that can be useful as we continue to grow and expand our business,” Mr. Kull said in a statement. "And I'm sure we can teach them a thing or two about Chicagoness while we're there.”

The group also plans to meet with Rep. Jared Polis, a Colorado Democrat who founded BlueMountainArts.com, an online greeting card website, and ProFlowers.com, an online florist.

It isn't known what administration officials will attend this year's entrepreneurship briefing at the White House, but past participants have included Valerie Jarrett, senior adviser to President Barack Obama; Steven VanRoekel, former U.S. chief information officer and now acting deputy director of the Office of Management and Budget; and Todd Park, U.S. chief technology officer.