What you need to know about the latest capital reform proposals

May 12, 2023

After more than three months of hearings and markups, the US House Financial Services Committee has officially approved 15 new pieces of legislation intended to expand access to capital for growing companies and encourage middle- and late-market companies to go public.

The approved bills are now headed to a House vote; those that pass by simple majority will move to the Senate for consideration. It’s important to note that House committee approval is one of the very first steps on the long and complicated journey to actually becoming law—which means it’s impossible to know for sure which, if any, will be successful.

Still, the hearings have been unusually collaborative so far, with nearly half of the approved bills receiving unanimous support in the latest vote. That could be a good sign: it indicates that lawmakers on both sides of the aisle are willing to work together to enact positive change for growing businesses.

Three of the approved bills in particular are predicted to have a massive impact on the entire startup funding ecosystem if enacted. Let’s dig into those three bills and what could happen if they are signed into law.

The Expanding Access to Capital Act (H.R. 2799)

Of the three bills we’ll cover today, the Expanding Access to Capital Act (H.R. 2799) was the most contentious, passing with 28 ayes to 21 nays. One of the key changes it proposes is a substantial improvement to Regulation A+: doubling the maximum offering amount from $75M to $150M per 12-month period.

A $150M offering max would be a huge deal for Reg A+ and the overall equity crowdfunding industry. It would make the exemption much more attractive to larger, more established startups that have greater capital requirements—especially in a market where companies are staying private longer and IPOs are hitting record lows.

The bill would also allow certain low-revenue companies to raise from accredited investors without needing to go through the cumbersome and expensive process of registering with the SEC. In short, H.R. 2799 would make it easier for small and medium-sized businesses to access capital (and more of it, too).

The Accredited Investor Definition Review Act (H.R. 1579)

The Accredited Investor Definition Review Act is a bill that seeks to amend the definition of "accredited investor" to expand the pool of individuals and entities that can invest in private securities offerings.

Currently, the definition of an accredited investor is based on income and net worth requirements that have not been updated in many years—and fail to account for the fact that simply having money doesn’t make a person particularly skilled at making it. 

The committee heard testimony from entrepreneurs and VCs who argued that the current accreditation restrictions aren’t just onerous—they’re unfair. Rodney Sampson, founder and CEO of Opportunity Hub, spoke in favor of changing the rule:

“I don’t see a lot of legislation blocking people from buying Yeezys or going to Vegas. I think you should be able to invest in your frat brothers’ business.”

– Rodney Sampson, CEO @ Opportunity Hub

Though tongue-in-cheek, it’s a fair question to ask: If Americans can legally gamble away their life savings at a casino, or spend the bulk of their income on lottery tickets, why should they be barred from participating in potentially high-growth investment opportunities?

If H.R. 1579 passes, the SEC will be required to review the accredited investor definition every five years, considering factors like education, certifications, and experience as indicators of financial sophistication. Proponents hope this periodic review will gradually expand the definition so that it includes more non-wealthy individuals who can prove they know what they’re doing.

A similar bill that was also approved, the Equal Opportunity for All Investors Act (H.R. 2797), would allow individual investors to qualify by passing an examination or course—a much cheaper and more efficient avenue for knowledgable investors who haven’t made it their formal career (and thus have no need for the relevant certifications or degrees). 

The Middle Market IPO Underwriting Cost Act (H.R. 2812)

According to recent data from CB Insights, quarterly IPOs in the US hit their lowest level in nearly a decade in Q1 2023, with just 86 companies taking the plunge. It’s no surprise that companies are delaying their plans to go public—between inflation, the ongoing banking crisis, and generally poor stock market performance, many companies that are “ready” have decided to wait for better conditions.

The result is a massive backlog of large companies that “should” be publicly-listed, but aren’t. With billions of dollars in venture capital tied up in exit purgatory, earlier-stage companies are suffering from the downstream effects: fewer and smaller deals, with more investor-favored offering terms.

While current economic conditions are certainly adding pressure to the situation, the decline of the initial public offering has been a subject of concern for many years now. IPOs are an important “last step” in the funding life cycle; they help to fuel innovation and economic growth by providing companies with access to capital that can be used to develop new products, technologies, and services. Additionally, IPOs are a key liquidity tool for early investors while  creating opportunities for the general public to buy and trade in the company’s stock..

The Middle Market IPO Underwriting Cost Act, if enacted, would require the SEC to work with FINRA to conduct a study of the costs small- and medium-sized companies incur when they go public. The goal is to identify and analyze the impact these costs have on growing businesses; to determine whether they’ve changed substantially over time; and to deliver a report to Congress detailing all findings and recommendations they come up with.

What happens next

As we mentioned before, approval of the 15 bills by the House Financial Services Committee doesn’t mean they’re going to be signed into law. In order for that to happen, all of the following steps still need to take place: 

  • The bills must be debated and voted on by the House, and need to win at least a simple majority (218 of 435 votes);
  • They’ll then move to the Senate, which will assign the bills to a committee;
  • The committee will review and potentially revise the bills before deciding whether to send them to the Senate floor for a vote;
  • If the bills win a majority vote in the Senate, they will be sent to the President;
  • And the President must sign the bill into law (or do nothing, in which case the bill becomes law automatically after 10 days).

All that is to say that these proposed changes are still in the earliest stages of the process—and it’s impossible to know for sure how the chips will fall. But early indicators suggest widespread bipartisan support for the bills’ underlying missions: to make it easier for companies and investors to access opportunities for growth.

Monogram Case Study - DealMaker (Embed)

When VCs said no, Monogram turned to retail investors. That decision powered their rise from startup to publicly traded company—and even helped them raise an additional $13M privately after their Nasdaq debut.

Monogram at NASDAQ celebration

The Challenge: Raising Capital on Their Terms

The Challenge: Raising on Their Terms

Monogram Technologies was founded with a bold vision: to revolutionize orthopedic surgery with a robotic joint replacement system using custom 3D-printed joints. The market for this technology is massive—approximately $19.6 billion, with over 1 million knee replacements per year. But it's a capital-intensive, regulation-heavy space—and traditional VCs weren't biting.

Instead of compromising, co-founders Dr. Doug Unis and Ben Sexson went all-in on a different path: retail capital. Why?

  • Control and ownership: Not only were they able to raise the capital they needed to grow the business—they did it on their own terms.
  • Long-term asset: They wanted to build an army of true believers who wanted to see the company succeed and would continue to reinvest over the years.
  • A value-add network: Raising from retail allowed Monogram to amass a waiting list of thousands of patients eager to participate in future trials.
  • Aligned incentives: Their mission to improve patient outcomes and build a better future for those struggling with joint pain resonated with retail investors.

The Power of Retail: Monogram's Capital Journey

Start Date End Date Type Platform Amount Raised # Investors
3/13/193/31/20A+SeedInvest$14,588,6686,000
11/16/201/16/21A+StartEngine$2,965,5018,000
1/17/212/18/22A+StartEngine$23,647,85314,082
7/15/223/16/23CFDealMaker$4,673,0002,249
3/1/234/8/23A+Republic$232,275120
3/1/235/23/23A+DealMaker$15,958,3645,198
5/18/23-Nasdaq listing
7/2410/24Unit OfferingDealMaker$12,990,1032,745

Monogram Capital Raise Timeline

Monogram's first direct-to-investor raise was a $14.6M round in 2019. Since then, Monogram has raised retail capital six additional times, using Reg A+ as a springboard to a Nasdaq listing in 2023.

Each raise brought in new believers—and more importantly, kept bringing them back. That's the long-term power of retail capital. It's not just one campaign—it's a compounding asset that grows with the business.

$80M+
Raised across seven campaigns
~40,000
Investors championing Monogram's vision
20%
Of each raise came from previous investors

Marketing Excellence

DealMaker Reach provided strategic investor acquisition services, helping Monogram connect with the right audience through high-impact channels.

Premium Publications

Targeted campaigns in premium publications like Morning Brew captured qualified investors

High-Engagement Webinars

Engaging events that generated over $4.3 million in investments

Community Building

Strategic approaches that fostered a loyal shareholder base

Investment Momentum

Innovative approaches that amplified investment momentum

Monogram's Journey to Success

Monogram's journey has been defined by relentless innovation, strategic fundraising, and breakthrough advancements in robotic-assisted joint replacement. From early-stage research to a Nasdaq listing and beyond, Monogram's milestones reflect its evolution into a pioneering force in orthopedic surgery:

  • Filed its first patent application in 2017
  • Conducted clinical studies at UCLA and University of Nebraska
  • Expanded the team with key hires
  • Attracted a top-tier advisory board to guide clinical innovations
  • Signed their first distribution partnerships
  • Made headlines with cutting-edge live demonstrations
  • Secured 501(k) FDA clearance for the mBôs surgical system

Nasdaq Debut & Beyond

In May 2023, Monogram Orthopaedics successfully listed on the Nasdaq—a significant milestone offering liquidity and growth opportunities for the company.

For most companies, that would be the end of their story in the private markets. But for Monogram, it was just the beginning of a new chapter.

Public perception says you can't raise privately post-IPO. Monogram proved that wrong.

Defying conventional fundraising norms, Monogram raised an additional $13 million from private investors, powered by DealMaker. This move highlighted the power of a dedicated investor community and provided additional strategic growth capital. Meanwhile, strategic digital marketing for the private offering helped boost the public share price—a win-win for the company and its investors, both public and private.

This was retail capital at its best: strategic, repeatable, and aligned.

One vision. Zero compromises.

This wasn't a one-time raise. It was a multi-year capital strategy.

Retail capital helped Monogram:

  • Go from concept to commercialization without relying on VCs
  • Retain ownership and control in a high-burn industry
  • Build a base of loyal shareholders who invested not once, but over and over again
  • Uplist to the Nasdaq, and still keep raising post-IPO

This is what makes retail capital different. It doesn't expire—it compounds. And DealMaker is built to maximize that long-term value.

Dr. Doug Unis Quote
Ben Sexson Quote

Ready to Raise Capital on Your Terms?

Whether you're pre-revenue or post-IPO, DealMaker gives you the infrastructure, support, and strategy to raise from the people who believe in you most.

Explore Raising Capital with DealMaker
DealMaker Logo

The ultimate technology for raising capital online

Talk to the experts
The ultimate technology for raising capital online - talk to the experts