The SEC has gutted the JOBS Act. But, the JOBS act wasn’t really about creating jobs. It was a dog and pony political show designed to get people to think the politicians were going to try and create jobs, when all they really wanted to do was divert attention and set up bureaucracies.
This whole charade was specious to me from the beginning. First I saw a Twitter campaign lead by Steve Case. Then, Facebook and other social media campaigns about how great all this was going to be.
I am sorry. When a politician gets hyper involved, it’s not going to be great. AS Brad Feld identified in his book about Startup Ecosystems, politicians are feeders. If we rely on government to get things going, it is guaranteed to fail. Governments only get in the way, and create imbalances and limits.
However, lots of folks in the VC and Angel capital world were hopeful that this time, maybe, maybe the government would get it right. I was skeptical, but also hopeful.
Lucy pulled the football away from Charlie Brown again
The JOBS Act was doomed upon inception. Politicians and most lawyers are not inherent risk takers. They don’t understand it, and cannot calibrate it. Most of the time, lawyers try and kill deals because all they see is risk. That’s a part of their training.
Governments exist to write rules and regs and enforce behavior. American government has gotten too big for its britches, and now wants to regulate everything from what we eat, how we sleep, our money, our healthcare and virtually everything else.
I for one think that anyone ought to have the individual liberty to invest in anything or anyone with their own money, no matter their class, race, gender, or anything else.
I trust that they are smart enough to make a decision.
Will there be fraud? Yes. Will there be failures? Tons. Will people lose money? Yup, probably about the same rate they are now.
That is a function of a free, open marketplace. The good news is if people take the time, there is a lot of information out there to sift through to be able to take a measured, calculated risk and invest in someone to try and get a nice rate of return.
I have seen first hand over and over people take ideas, turn them into companies and be successful. I have seen over and over people invest their own money and raise their standard of living by assuming risk. I did it myself.
Currently, I am beginning to raise a fund, West Loop Ventures, to invest in early stage companies. Anyone ought to be free to invest their own money in it if they choose to.
I have no idea if I will be successful raising a fund or not. It’s never easy to raise money, ever. I do know that if the fund is raised, we have a high probability of success because of the team we have built.
Governments in general, do not promote innovation, or raise the wealth of the people they serve. They are there to put limits on people.
Free markets create wealth. Free markets promote innovation. Raising capital ought to be a free market.