Funding new projects
Oregon businesses have the opportunity to raise funds for new projects or expand existing ones through two exemptions that allow businesses to raise money with reduced regulation while ensuring investors are protected.
Renewable energy cooperative corporation
Oregon-based cooperative corporations can use an exemption allowing them to raise funds to develop and operate renewable energy sources without going through a full-blown registration process or using a licensed securities salesperson.
To use this exemption, the co-op must meet requirements including:
- Investors must be part of a community affiliated with the co-op or its project.
- The co-op cannot raise more than $1.5 million in funds from “non-accredited” members (i.e., individuals with a net worth of less than $1 million).
- The co-ops may promote their mission and goals, but the promotion must be limited in nature and each person interested in investing must receive specific disclosures about the risks of the investment.
Other details are in the complete rule, starting with Oregon Administrative Rule (OAR) 441-025-0120.
Raising money through small investments from a large number of investors, known as crowdfunding, can help smaller businesses access capital for new ventures or expansions.
For more details see the complete rule, OAR 441-035-0070 to 441-035-0230.
Oregon-based companies can raise up to $250,000 from Oregon investors to start new businesses or fund existing operations. Like the renewable energy exemption, companies can offer investments without registration or licensing a salesperson.
To use the exemption, the company must meet requirements, including:
- The company must be registered and doing business in Oregon.
- The securities, or investments, can be offered only to Oregon residents.
- The company must provide investors with formal disclosures for their review before an investment decision becomes final.
- The company can provide limited advertising to Oregonians on the investment.
- No single investor can invest more than $2,500 in any one investment.
For more details regarding the exemption, please read the frequently asked questions.
Other methods for raising capital
There are other tools local companies can use to raise capital. They include the Oregon Small Corporate Offering Registration (SCOR) and sales through Rule 506 under Regulation D of the federal securities law.
See the rules for a SCOR offering.