SEC rules permit investment crowdfunding campaigns conducted under Regulation A to use “test-the-waters” communications, which communications may occur prior to submitting SEC filings. “Test-the-waters” communications are communications that companies make to potential investors in order to gauge investor interest in an offering. The “test-the-waters” process also allows prospective investors to reserve securities related to a game ahead of time, so that once the campaign begins, they are given priority over prospective investors that have not reserved securities. This reservation system enables companies to move forward with the cost of filing only after they receive confirmation of sufficient investor interest. Investors are not committed to making an investment and Fig will not accept investor funds during the “test the waters” period.
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