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FUNDING RESOURCES: Small Companies Offering Registration
SCOR is a public state registration through which companies can raise up to $1 million per year. It is a financial vehicle setup for small companies to raise money through individual private investors. The investors do not have to be accredited, which means they don't have to have a minimum net worth of $2 million or $250,000 in disposable income. Most states now have provisions for SCOR offerings. The requirements for the legal and accounting work are minimal and the approval process is streamlined.
How It Works: Filling out a SCOR is similar to developing a prospectus to go public. Every state has certain requirements, so the best way to make sure the company is in compliance is to contact a securities attorney in the state where the company is headquartered. Also speak with the state's securities office, which can be found by contacting the state's department of commerce. SCOR is controlled by each individual state.
Advantages: It is not as cumbersome or as expensive as doing a public offering. There is no downside.
To use SCOR to raise capital, contact a securities attorney and have them give you the proper forms for an offering.