Bipartisan consensus advances bills helping companies raise cash

{mosads}However, Senate Democrats have shown no inclination to take up the bills, and comparable measures are not being considered in that chamber.

One bill, offered by House Republican Whip Kevin McCarthy (R-Calif.), would allow small companies to broadly market their securities to potential investors. Under current law, companies looking to raise cash by selling securities either have to register with the Securities and Exchange Commission (SEC), or simply market the securities to investors they already know.

Rep. Patrick McHenry (R-N.C.) was the sponsor of a second bill that would allow companies to raise cash online via “crowd funding.” Investors could invest up to $10,000 in a company under the bill, and companies could raise up to $1 million this way — $2 million if they provide audited financial statements.

However, that measure curried favor from Democrats only after provisions were added that would warn of the risks in investing in startups and allow the SEC to conduct some oversight of the process.

Another measure, offered by Rep. Dave Schweikert (R-Ariz.), would allow companies to accumulate 1,000 shareholders before having to register with the SEC, up from the current cap of 500. Rep. Jim Himes (D-Conn.) sponsored a related measure, which would increase the limit to 2,000 shareholders for banks.

House Majority Leader Eric Cantor (R-Va.) hailed the bills as decisive action to boost the economy after their passage.

“We need to move past our differences and come together to create an environment for economic growth and job creation,” he said in a statement. “I agree with President Obama that we can’t wait — and the House isn’t waiting.”