If a Morrisville businessman has his way, entrepreneurs in North Carolina may soon get a chance at a new source for capital that has proved to be scarce otherwise: Through crowdfunding.

Rep. Tom Murry, a businessman and Republican, along with three others, is pushing legislation to help entrepreneurs raise money while the SEC wrestles with implementation of the Jumpstart Our Business Startup Act (or JOBS Act) that was passed last year.

Backers call the bill the “North Carolina JOBS Act.”

“You’re talking about a mom and pop type of operation using a web based platform to raise capital and small investment,” Murry said at the General Assembly.

The legislation is House Bill 680. It passed the first big hurdle this week, winning approval in the House Commerce committee.

The Research Division of the General Assembly sums up the bill this way: 

“House Bill 680 allows certain North Carolina businesses to raise funds by the sale of securities under certain circumstances by exempting the businesses from the registration and filing requirements of the North Carolina securities law.”

Next step is consideration by the Finance committee, which could happen as early as next week, WRAL’s Mark Binker tells the Skinny.

However, there is opposition even among some Republicans, including none other than Rep. Edgar Starns, the House Majority Leader.

“I don’t want to go down this road … you’re talking about some rather risky investments,” Binker quoted Starns as saying.

Murry is hoping North Carolina will join other states such as Kansas and Georgia that have already passed crowdfunding bills.

Why are states doing this? Because the crowdfunding part of the (JOBS Act) passed by Congress last year is months away from approval by the SEC – at the least.

Murry says he wants the bill passed so startups and small businesses can get more access to capital outside the conventional means of angel and venture funding, loans as well as grants – even their own credit cards.

“We don’t want to inhibit small businesses from being productive in our state while we’re waiting on the federal government,” Murry explained. He also said that he would expect North Carolina’s Secretary of State to move much more quickly than the federal government should Bill 680 be passed.

Representatives Tim Moffitt, Phil Shepard AND Kelly Hastings also sponsored the bill.

A website set up to promote the bill touts three entrepreneurs as supporters:

  • Steve Reaser, co-founder of Funding Launchpad and founding member of the Crowdfunding Professionals Association.
  • Mark Easley, an advisor to Triangle startups, an angel investor and a member of the Council for Entrepreneurial Development.
  • Nick Bhargava, a Triangle entrepreneur and a winner of an NC IDEA grant.

If the Act were to become law, it would expire as of July 1, 2017.