Maine crowdfunding law to boost businesses
Maine has become the first state in the country to enact a crowdfunding law that allows companies to sell shares to investors wherever they reside.
The Portland Press Herald reported that the new law, which took effect this month, allows Maine companies to raise debt or equity from anyone, regardless of location. While crowdfunding laws have been enacted in 11 other states, none of them allow investors from out-of-state.
The Maine crowdfunding law, however, comes with limits for both companies and investors. Companies are only allowed to raise $1 million in a 12-month rolling period, while any one investor can only give a total of $5,000.
Kay Aikin, CEO of Portland-based Introspective Systems, told the newspaper her startup would have grown faster if the crowdfunding law had been enacted earlier.
"If I had 50 or 100 architects who all put in $2,000 and they owned a little bit of [the company], that would have given me customer validation and money," she added, "and then the investment community would have started to look at us differently."
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