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Mary Juetten, Founder & CEOFeb 10, 2014Pennsylvania Bar Association IP SectionCROWDFUNDING UPDATE

L Crowdfunding Overview

REWARDS BASED:Indiegogo, Kickstarter, Rocket Hub

EQUITY BASED:Federal not yet legal; some intrastate

OTHER:Angel List, Lending Club, Georgia CF

Rewards Based

CHOOSE THE BEST PLATFORM FOR YOU:

• ALL OR NOTHING• % BASED ON TYPE• BE REALISTIC

FIND THE CROWD

Success is directly related to Social Capital

Social Capital is more than Social Media

Equity Status

Equity/Security is not yet Legal (Title III)

Rule comment period ended Feb 3rd

Intrastate live in several states

585 PAGES OF RULES

10 Requirements JOBS Act

1. Registration & Incorporation in US2. Names – Directors, Officers, >20% SH3. Business Description & BUSINESS PLAN4. Prior years Tax Returns 5. Financial Statements6. Use of Proceeds7. Offering Details & Progress Updates8. Share price & methodology (VALUATION)9. Ownership & capital10. Capital (existing, offering & differences)

Rules – FORM C Disclosure

1. Registration & Incorporation in US2. Names – Directors, Officers, >20% SH3. Business Description ONLY4. Prior years Tax Returns 5. Financial Statements ONGOING & ANNUAL

REPORTS6. Use of Proceeds7. Offering Details & Progress Updates8. Share price & methodology (VALUATION)9. Ownership & capital10. Capital (existing, offering & differences)

GAAP Financial Statements

< $100K – CEO$100K to < $500K Review

> $500K = AUDIT by non-PCAOB but CPA Firm

Not the same CPA as preparations!

EQUITY is not Easy

Tough requirements include:

Business Plans

Financial Statements

Use of Proceeds

Valuation

Devil in the Details

$XM Valuation/ $X per share price/ Total $XK

Spend: MAKE SELL OPERATE

$XK Now $XK $YK $ZK$XK Next $XK $YK $ZK$XK Then $XK $YK $ZK

$

Valuation Issues

Recent Venture Beat article:

- Employee Stock Options- Key Performance Indicators (KPIs)

IDENTIFY IP

PROTECT IP

PICK A PLATFORM

BUILD SOCIAL CAPITAL

CREATE A PITCH

CROWDFUNDING APPROACH

Campaign

Business Plan

Projections

Rewards

`

CREATE PITCH

CONTENT IS KING

Expert

Blogs

Speaking

Social Media

PR

Start working on this

BEFORE you launch your

campaign.

Traklight blog

Infringement!

Education is KEY

INVESTORS

ISSUERS

INTERMEDIARIES

Questions?

Mary Juetten

mejuetten@traklight.com

@traklight

IDENTIFY. PROTECT. SUCCEED.

www.traklight.com