Washington, D.C.--(Newsfile Corp. - February 28, 2025) - Rebecca Kacaba, CEO and co-founder of DealMaker, the leading technology platform for online capital-raising, testified this week before the U.S. House Financial Services Committee's Subcommittee on Capital Markets.
Kacaba advocated for regulatory reforms to expand access to capital, harmonize the crowdfunding rules, and bolster economic growth.
Addressing a distinguished panel of lawmakers, including Chairwoman Ann Wagner, Ranking Member Brad Sherman and House Financial Services Committee Chair French Hill, Kacaba underscored the critical need to increase annual limits associated with crowdfunding, streamline complex regulations, and create a pathway for more founders to build the businesses of the future.
Key takeaways from Kacaba's testimony:
- The JOBS Act is working. "Reg A and Reg CF have raised $3.7 billion, and Reg CF has outpaced venture capital in terms of growth more than three times over," Kacaba said. "During the worst year of the recent downmarket cycle in 2023, the online capital markets stayed over 40% stronger than the VC markets. Companies we supported survived and thrived when no one thought it would be possible."
- Increasing the caps has proven to stimulate economic activity: "The 2020 increase in the Reg CF cap from $1.25 million to $5 million stimulated market activity by 250%." Today, companies are regularly reaching the $5M cap on Reg CF offerings. They need more capital to drive more growth.
- Regulators can increase the number of new businesses funded by (a) increasing the caps and (b) streamlining the way Reg A and Reg CF work together.
Her testimony also highlighted how more modern regulations would empower American entrepreneurs to thrive and create thousands of jobs by providing equitable access to capital markets.
"The technology that we've built at DealMaker, and that a lot of our colleagues have built in the space, is foundational to helping more entrepreneurs get funded in today's day and age," said Kacaba. "The JOBS Act since its inception has helped so many small businesses form and created so many jobs. There are very simple small adjustments that we can make so that the online crowdfunding space can flourish, to allow more growth and for more jobs to get funded."
A Call for Modernized Capital Markets
Kacaba's urged key reforms to improve access to capital, including:
- Increasing the amount founders can raise: Raising annual raise limits would allow more companies to access necessary growth capital, empowering founders to scale their businesses without unnecessary constraints. These caps restrict companies in more capital-intensive industries, like biotech and sports, from completing meaningful capital raises under the exemption.
- Streamlining complex regulations and harmonizing the industry: Streamlining compliance requirements will reduce costs and administrative burdens for startups and small businesses.
- Expanding investor participation: Incentivizing retail investors to participate in online equity offerings is already a proven model in the UK. Data from the Crowdfunding Professionals Association indicates a similar program in the U.S. could generate $120 billion in economic activity and create 1 million new jobs.
Supporting American Entrepreneurship
DealMaker has pioneered an innovative approach to capital-raising, allowing founders to bypass traditional gatekeepers and engage directly with investors. By reducing friction in the fundraising process, DealMaker is enabling a new era of entrepreneurship, where businesses can efficiently move from concept to IPO.
Kacaba emphasized that modernizing regulations would not only support small businesses-which account for 80% of net new jobs created in America since 2011-but also drive significant economic growth.
Kacaba stated, "We cannot afford to leave billions of dollars in potential economic impact on the table. Expanding these capital-raising frameworks will create jobs, fuel innovation, and level the playing field for founders outside of traditional financial hubs."
Kacaba's address can be viewed here. Her written testimony is available here.
About DealMaker
With offices in both the United States and Canada, DealMaker is the leading technology platform transforming how companies raise capital through Regulation A, Regulation CF, and Regulation D offerings. With a focus on efficiency, transparency, and compliance, DealMaker has facilitated over $2 billion in capital raises for companies across a wide range of industries. The platform empowers founders to take control of their fundraising journey and provides retail investors with unprecedented access to private market opportunities.
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SOURCE: DealMaker
