Equity Crowdfunding FAQ:
Does equity crowdfunding require financial projections?
At Mr. Crowd, we don't require issuers to provide financial projections. However, we require issuers providing financial statements for the past 2 years, if any. This is because, the SEC requires certain financial figures like Total Assets, Cash, Net Income for the past 2 years for a Regulation Crowdfunding / Title III securities offering .
As a general rule of thumb, we advise issuers to be cautious regarding the use of projections. This is because financial projections like projected growth, revenue or income provided to investors should be attached with additional legends and disclaimers, to safeguard themselves from misleading the investors. In fact, these legends and disclaimers which should be carefully drafted by securities attorneys.
Generally, we advise against the use of projections because of the amount of litigation surrounding it and possible issues with SEC.
 An issuer must include the Form C the selected financial data for the prior two fiscal years, including total assets, cash and cash equivalents, accounts receivable, short-term debt, long-term debt, revenues/sales, cost of goods sold, taxes paid and net income.
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