Investment Portals: Has the Era of Online Venture Capital Begun?
Web technologies are revolutionizing business models and changing the ways in which we interact. The Internet and its millions of websites have transformed the way businesses market their products. This technological revolution is a natural habitat for capital raising; but its development has been fitful, in part, because of regulatory limits. The particular challenge for Internet-based venture capital marketplaces has been that investments are restricted securities under the Securities Act of 1933 (Securities Act), limiting the ability of the funds to solicit investors, and requiring any online venture capital marketplace to prescreen investors.