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Private Companies Publicly Fundraising: Where’s The Money Going?

On September 23 last year, a rule-change fundamentally shifted the fundraising landscape for entrepreneurs. And it’s had hundreds of millions of dollars of impact. Entrepreneur.com is referring to the Jumpstart Our Business Startups Act. Since then, thousands of private companies have raised money publicly, according to data compiled from New York City-based Crowdnetic.

The benefits of the rule change have mostly been felt in Silicon Valley, according to Crowdnetic. While there are private companies raising money through this “crowdfinance” model all across the U.S., California has seen more recorded capital commitments than any other state by far. Taken together, San Francisco and Los Angeles have raised more than seven times what private companies in New York have raised.

We’ve covered several topics on the “crowd-funding” in previous posts, and the Jobs Act is fundamentally changing the landscape of crowd-funding in the United States. According to Entrepreneur.com, in the meanwhile, taken across industries, social media and e-commerce have the greatest number of private companies raising money from investors reached through public advertising. By dollar amount, however, real estate development companies are taking the lion’s share of the funding, with capital commitments of $17 million.

The following infographic shows Top Industries by Recorded Capital Commitments and Top Industries by Number of Active PIPRs.

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