Finders play a vital role in introducing startups to potential investors. Yet the general requirement that persons soliciting investors must register with the Securities and Exchange Commission as broker-dealers and be subject to the SEC’s broker-dealer regulatory regime has been a source of much uncertainty for finders and companies alike and has posed a serious
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Do Private Company M&A Intermediaries Need to Register with the SEC as Broker-Dealers?

By Alon Y. Kapen on
Since 2014, many private company mergers and acquisitions intermediaries have chosen not to register as broker-dealers. That’s because a 2014 SEC no-action letter took the position that intermediaries that limited their activities to representing private companies in M&A deals were not required to register with the SEC as broker-dealers. But as a no-action letter, the…