Follow the Money: Twitter Fundraising Is Now Legal

The SEC has given startups the green light to announce on Twitter and Facebook that they're seeking funding.

Startups can now announce that they're seeking funding and investment via social media and print publications. The Securities and Exchange Commission announced the change earlier today. It's the result of section 201(a) of the JOBS act, which reverses 80-year-old limits on fundraising advertising. While the bureaucratic details may be boring, the implications aren't: Startups can now solicit funding from the general public—and everything that entails.

TechCrunch's Josh Constine and Gregory Ferenstein did the analysis, and it's a fundamental game changer, allowing companies to have their cake and solicit more frosting, too.

The big question following up on this announcement is how Facebook and Twitter will tweak their services for businesses in light of the SEC changes. After all, startups have money to burn—would they pay extra to reach the right investors?

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