crowd funding

The Alabama Senate is trying to give people a new way to raise money to start small businesses.

The Senate voted 31-0 Thursday for a "crowd funding" bill sponsored by Republican Sen. Arthur Orr of Decatur.

The legislation is backed by the Alabama Securities Commission. It would allow someone trying to start a small business in Alabama to use social media and advertising to find small investors who live in the state. It is limited to raising $1 million, and it is restricted to Alabama businesses and investors because of federal regulations.

Alabama Securities Commission

Alabamians trying to start small businesses in a tough credit market may soon have a new method that will allow them to raise small amounts of capital from many Alabama investors.

Republican state Sen. Arthur Orr of Decatur says he will sponsor a bill in the upcoming legislative session to allow "crowd funding." It would cap investors at $5,000 each and would limit crowd funding to $1 million per business.