Question
Is it true that it can cost almost 40% of the raised amount? I'm referring to: http://venturebeat.com/2014/01/02/it-might-cost-you-39k-to-crowdfund-100k-under-the-secs-new-rules/
We are not so much interested in rasing the funds via crowdfunding, but how much does a seed round usually cost a startup in legal and compliance fees?
Answers: 1 public & 0 private
I wouldn't care to speculate on what it might cost to crowdfund a certain amount of money given whatever SEC rules are applicable. But assuming you're raising seed money in the US for a US entity, e.g. a Delaware corporation, there's really not any good excuse for legal fees to exceed $10,000. And if it was me, I would be trying to push the legal fees down much lower than that. These days, forms of early stage financing documents are generally available (see e.g. www.seriesseed.com, www.techstars.com/docs/, or www.ycombinator.com/documents/) on the web, and the major deal points of these documents are widely agreed upon. So there shouldn't be that much to negotiate. And I can assure you your prospective investors don't want you spending a lot of money on legal fees.
If you haven't set up a legal entity yet, or a bank account for the legal entity, there will be some fees incurred here. But no more than a few hundred dollars.
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