Tucson nonprofit Community Investment Corporation recently announced it has teamed up with Startup Tucson and San Francisco-based crowdfunding platform Wefunder to bring equity crowdfunding and startup support to the southern Arizona city.

In partnership with CIC, Wefunder鈥檚 will provide opportunities for companies that might not be ready for typical venture capital or angel investments. According to CIC, funding rounds are not limited to smaller amounts but are generally lower than typical equity fundraising.

鈥淲e want to ensure that Tucson entrepreneurs have access to the capital they need,鈥� said Danny Knee, . 鈥淧artnering with one of the most mature and visible crowdfunding platforms like Wefunder is a great way to expand access.鈥�

Gov. Doug Ducey signed a bill in 2015 to allow small businesses and entrepreneurs in Arizona to raise money from the general public through equity crowdfunding.

House Bill 2591 allows companies to raise up to $2.5 million and non-accredited investors to give up to $10,000 each.聽

鈥淲e鈥檙e in favor [of this law] because there is a need for more refined instruments on how people can raise capital,鈥� Mitzi Montoya, vice president and dean of entrepreneurship and innovation at Arizona State University, . 鈥淐rowdfunding is an excellent concept to leverage that social network for investments.鈥�

According to Montoya, equity crowdfunding empowers small businesses and entrepreneurs with wider access to capital, providing more funding options than just banks, family and friends, and angel investors.

HB 2591 has paved the way for the new partnership between CIC, Startup Tucson and Wefunder.

The alliance came just in time for Tucson鈥檚 TENWEST Impact Festival, an annual week-long festival that gathers 鈥渇orward-thinking minds鈥� to for creating social, environmental and economic impacts.

, which took place from Oct. 11 to 20 this year, first started in 2015 as Arizona鈥檚 version of the popular South by Southwest festival in Austin, Texas.

Knee also credited TENWEST leadership at , including executive director Liz Pocock and programs and events director Dre Voekel, with helping seal the deal with Wefunder.

is a nonprofit organization that supports economic development in the Tucson region by providing current and aspiring entrepreneurs with education, networking, mentoring and a free membership program to help them grow their businesses.

Wefunder was founded in 2011 but has recently become more involved in local community fundraising, according to CIC.

鈥淐IC caught wind of this interest and began conversations with Wefunder in late spring of this year,鈥� the company said in a statement.

What caught Knee鈥檚 attention were the values Wefunder鈥檚 executives expressed and their rationale for expansion to smaller cities like Tucson, according to the statement.

Wefunder has funded 307 startups with $108.5 million and venture capitalists have invested over $2 billion more in Wefunder鈥檚 portfolio of successfully funded businesses.

鈥淚t was not a profit play for Wefunder,鈥� Knee said. 鈥淭hey are truly all about the democratization of capital and investing. They are about just like CIC is.鈥�

Businesses that want to seek funding through the new partnership can

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In order to get their product or service off the ground, most small companies turn to startup funds in the private sector, where they can sell securities to 鈥�.鈥�

To obtain accreditation, a person or business entity must meet a certain threshold of income, net worth or asset size. Consequently, the number of Americans who are able to invest privately is severely limited.

, R-Ariz., and , R-Ark., introduced the Fair Investment Opportunities for Professional Experts Act (H.R. 4672) to try to alleviate the exclusivity of private-sector investing.

If passed, the bill would expand the definition of 鈥渁ccredited investor鈥� to include Americans with qualifying educational or professional experience.

鈥淪imply put, this legislation would rightfully expand the definition of 鈥榓ccredited investor’ to include professional experts, allowing the opportunity for more Americans to invest in ideas early on based on their knowledge and suitability rather than their wealth,鈥� Schweikert said in a statement. 鈥淭he current financial parameters on investors we have are based solely on wealth, excluding individuals who have the experiences necessary to be provided access to suitable investments. I thank my colleague, Representative French Hill, for his continued support and I hope this common-sense legislation can swiftly pass the House.鈥�

Currently, an accredited investor includes anyone who has earned income exceeding $200,000 (or $300,000 in a household) in each of the two prior years and anticipates making a similar income in the current year; or anyone with a net worth over $1 million.聽

The Fair Investment Opportunities for Professional Experts Act would expand the definition of an accredited investor to include those who hold a recognized federal or state securities-related license, as well as those who have demonstrable professional knowledge in a security administered by the Financial Industry Regulatory Authority (FINRA), the Securities and Exchange Commission (SEC) or a state-level equivalent.

鈥淓xpanding the definition of accredited investor is great for both businesses and investors,鈥� Schweikert said. 鈥淢any private security offerings are restricted to accredited investors because of the high risk nature of these offerings. Expanding the definition allows more hard-working Americans with sophisticated professional experience to be included in otherwise restricted investment opportunities, and that is a key economic growth driver.鈥�

Versions of the Fair Investment Opportunities for Professional Experts Act passed the House of Representatives with extensive bipartisan support in the past two Congresses. The bill passed the House in 2016 with a vote of 347 to 8. It passed the House by voice vote under suspension in 2017.

Schweikert and Hill said they hope the bill will receive widespread support again this Congress.

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