#capital-raising
Capital raising strategies and investor accounting
Tier 1 caps raises at $20M with state review and no audit; Tier 2 reaches $75M with preempted blue-sky laws, audited financials, and ongoing reports.
Reg A+ Tier 2 lets companies raise up to $75M a year from anyone — if they file Form 1-A, pass a two-year audit, and keep reporting to the SEC.
An MSO lets investors own a law firm's back office; an ABS lets them own the firm. Illinois HB 5487 now curbs both for contingency-fee practices.
An SPV pools many angel checks into one LLC and one cap-table line; backers pay 10–20% carry plus setup fees, and the lead votes the whole block.
West Virginia gives insurers a 60% premium-tax credit for backing growth funds that invest in local employers with fewer than 250 staff.
The SBA's SBIC rule effective February 2, 2026 opens a $53B program to manufacturers and suppliers — debt from $250K to $10M at 9–16%, equity from $100K to $5M.
The SEC's May 2026 proposals would extend scaled disclosure to all non-accelerated filers — over 80% of public companies — shield new issuers from large-accelerated-filer status for 60 months, drop the SOX 404(b) auditor attestation, and allow semiannual reporting. Here is what the reforms could save a small company, and the IPO-readiness bookkeeping checklist to run now.
Alphabet's Q2 2026 revenue was $119.8B (+24% YoY) and net income hit $112.2B (+298%), but roughly $99.0B of that was a non-cash gain on equity securities that the cash flow statement backs right out, leaving operating cash flow at just $39.1B. Google Cloud grew 82% to a ~$99B run-rate at a 35.6% operating margin, while Alphabet halted stock buybacks and raised ~$70B via common stock, its first-ever preferred, and debt to fund a $44.9B capex quarter that turned free cash flow negative. The FY2022–Q2 2026 Beancount ledger shows long-term debt climbing from $10.9B to $98.2B.
FASB's ASU 2024-04, mandatory for fiscal years beginning after December 15, 2025, defines a three-part test for whether settling a sweetened convertible-note conversion counts as an induced conversion (expense only the sweetener) or a debt extinguishment (gain or loss against carrying value) — a classification that can swing reported expense by hundreds of thousands of dollars on the same transaction.
The SBA's SBIC program channeled $53 billion into small businesses last year, and a final rule effective February 2, 2026 cuts red tape for funds backing manufacturing, food production, energy, and critical technology. Here's how the reforms work, how debenture and equity SBICs differ, and how to find a fund.
Before a Series A term sheet arrives, founders should check three specific cap table failure points — a pre-money option pool shuffle that dilutes only founders, missing or over-vested founder equity, and stacked SAFEs with unmodeled conversion terms — each of which can delay or derail a raise.
The EB-5 investor visa requires an $800,000 investment in a Targeted Employment Area (or $1,050,000 standard) plus 10 created jobs, and petitions filed by September 30, 2026 lock in today's thresholds before the EB-5 Reform and Integrity Act's grandfathering provision sunsets.
