Remarks by the President at JOBS Act Bill Signing

Rose Garden

2:36 P.M. EDT

THE PRESIDENT:  Thank you.  (Applause.)  Hello, everybody.  Please, please have a seat.  Good afternoon.  I want to thank all of you for coming, and in particular, I want to thank the members of Congress who are here today from both parties, whose leadership and hard work made this bill a reality.  

One of the great things about America is that we are a nation of doers -- not just talkers, but doers.  We think big.  We take risks.  And we believe that anyone with a solid plan and a willingness to work hard can turn even the most improbable idea into a successful business.  So ours is a legacy of Edisons and Graham Bells, Fords and Boeings, of Googles and of Twitters.  This is a country that’s always been on the cutting edge.  And the reason is that America has always had the most daring entrepreneurs in the world. 

Some of them are standing with me today.  When their ideas take root, we get inventions that can change the way we live.  And when their businesses take off, more people become employed because, overall, new businesses account for almost every new job that’s created in America.

Now, because we’re still recovering from one of the worst recessions in our history, the last few years have been pretty tough on entrepreneurs.  Credit has been tight.  And no matter how good their ideas are, if an entrepreneur can’t get a loan from a bank or backing from investors, it’s almost impossible to get their businesses off the ground.  And that’s why back in September, and again in my State of the Union, I called on Congress to remove a number of barriers that were preventing aspiring entrepreneurs from getting funding.  And this is one useful and important step along that journey.   

Here’s what’s going to happen because of this bill.  For business owners who want to take their companies to the next level, this bill will make it easier for you to go public.  And that’s a big deal because going public is a major step towards expanding and hiring more workers.  It’s a big deal for investors as well, because public companies operate with greater oversight and greater transparency. 

And for start-ups and small businesses, this bill is a potential game changer.  Right now, you can only turn to a limited group of investors -- including banks and wealthy individuals -- to get funding.  Laws that are nearly eight decades old make it impossible for others to invest.  But a lot has changed in 80 years, and it’s time our laws did as well.  Because of this bill, start-ups and small business will now have access to a big, new pool of potential investors -- namely, the American people.  For the first time, ordinary Americans will be able to go online and invest in entrepreneurs that they believe in.

Of course, to make sure Americans don’t get taken advantage of, the websites where folks will go to fund all these start-ups and small businesses will be subject to rigorous oversight.  The SEC is going to play an important role in implementing this bill.  And I’ve directed my administration to keep a close eye as this law goes into effect and to provide me with regular updates. 

It also means that, to all the members of Congress who are here today, I want to say publicly before I sign this bill, it's going to be important that we continue to make sure that the SEC is properly funded, just like all our other regulatory agencies, so that they can do the job and make sure that our investors get adequate protections.

This bill represents exactly the kind of bipartisan action we should be taking in Washington to help our economy.  I’ve always said that the true engine of job creation in this country is the private sector, not the government.  Our job is to help our companies grow and hire.  That’s why I pushed for this bill.  That’s why I know that the bipartisan group of legislators here pushed for this bill.  That's why I’ve cut taxes for small businesses over 17 times.  That’s why every day I’m fighting to make sure America is the best place on Earth to do business.

Our economy has begun to turn a corner, but we've still got a long way to go.  We've still got a lot of Americans out there who are looking for a job or looking for a job that pays better than the one that they've got.  And we're going to have to keep working together so that we can keep moving the economy forward. 
              
But I've never been more confident about our future.  And the reason is because of the American people.  Some of the folks beside me here today are a testimony to that.  Day after day, they’re out there pitching investors.  Some meetings go well; some meetings don't go so well.  That's true for me, too.  (Laughter.)  But no matter what, they keep at it.  And who knows, maybe one of them or one of the folks in the audience here today will be the next Bill Gates or Steve Jobs or Mark Zuckerberg.  And one of them may be the next entrepreneur to turn a big idea into an entire new industry.  That’s the promise of America.  That’s what this country is all about. 

So if these entrepreneurs are willing to keep giving their all, the least Washington can do is to help them succeed.  I plan to do that now by proudly signing this bill. 

Thank you very much, everybody.

(The bill is signed.)  (Applause.)

THE PRESIDENT:  All right, everybody.  Enjoy a great day.  (Applause.)

END             
2:44 P.M. EDT

President Obama To Sign Jumpstart Our Business Startups (JOBS) Act

Will Announce New Steps to Promote Access to Capital for Entrepreneurs and Protections for Investors

WASHINGTON, DC – Today President Obama will sign the Jumpstart Our Business Startups (JOBS) Act, a bipartisan bill that enacts many of the President’s proposals to encourage startups and support our nation’s small businesses. 

The President believes that our small businesses and startups are driving the recovery and job creation.  That’s why he put forward a number of specific ways to encourage small business and startup investment in the American Jobs Act last fall, and worked with members on both sides of the aisle to sign these common-sense measures into law today.   The JOBS Act will allow Main Street small businesses and high-growth enterprises to raise capital from investors more efficiently, allowing small and young firms across the country to grow and hire faster. 

“America’s high-growth entrepreneurs and small businesses play a vital role in creating jobs and growing the economy,” said President Obama.  “I’m pleased Congress took bipartisan action to pass this bill.  These proposals will help entrepreneurs raise the capital they need to put Americans back to work and create an economy that’s built to last.”

Throughout this effort, the President has maintained a strong focus on ensuring that we expand access to capital for young firms in a way that is consistent with sound investor protections. To that end, the President today will call on the Treasury, Small Business Administration and Department of Justice to closely monitor this legislation and report regularly to him with its findings. In addition, major crowfunding organizations sent a letter to the President today committing to core investor protections, including a new code of conduct for crowdfunding platforms.

In March of last year, the President directed his Administration to host a conference titled “Access to Capital: Fostering Growth and Innovation for Small Companies.”  The conference brought together policymakers and key stakeholders whose ideas directly led to many of the proposals contained in the JOBS Act. A primary takeaway from the conference was that capital from public and private investors helps entrepreneurs achieve their dreams and turn ideas into startups that create jobs and fuel sustainable economic growth. 

Key Elements of the JOBS Act

The JOBS Act includes all three of the capital formation priorities that the President first raised in his September 2011 address to a Joint Session of Congress, and outlined in more detail in his Startup America Legislative Agenda to Congress in January 2012: allowing “crowdfunding,” expanding “mini-public offerings,” and creating an “IPO on-ramp” consistent with investor protections. 

The JOBS Act is a product of bipartisan cooperation, with the President and Congress working together to promote American entrepreneurship and innovation while maintaining important protections for American investors.  It will help growing businesses access financing while maintaining investor protections, in several ways:

• Allowing Small Businesses to Harness “Crowdfunding”:  The Internet already has been a tool for fundraising from many thousands of donors.  Subject to rulemaking by the U.S. Securities and Exchange Commission (SEC), startups and small businesses will be allowed to raise up to $1 million annually from many small-dollar investors through web-based platforms, democratizing access to capital.  Because the Senate acted on a bipartisan amendment, the bill includes key investor protections the President called for, including a requirement that all crowdfunding must occur through platforms that are registered with a self-regulatory organization and regulated by the SEC.  In addition, investors’ annual combined investments in crowdfunded securities will be limited based on an income and net worth test.

• Expanding “Mini Public Offerings”:  Prior to this legislation, the existing “Regulation A” exemption from certain SEC requirements for small businesses seeking to raise less than $5 million in a public offering was seldom used.  The JOBS Act will raise this threshold to $50 million, streamlining the process for smaller innovative companies to raise capital consistent with investor protections.

• Creating an “IPO On-Ramp”:  The JOBS Act makes it easier for young, high-growth firms to go public by providing an incubator period for a new class of “Emerging Growth Companies.” During this period, qualifying companies will have time to reach compliance with certain public company disclosure and auditing requirements after their initial public offering (IPO).  Any firm that goes public already has up to two years after its IPO to comply with certain Sarbanes-Oxley auditing requirements.  The JOBS Act extends that period to a maximum of five years, or less if during the on-ramp period a company achieves $1 billion in gross revenue, $700 million in public float, or issues more than $1 billion in non-convertible debt in the previous three years.

Additionally, the JOBS Act changes some existing limitations on how companies can solicit private investments from “accredited investors,” tasks the SEC with ensuring that companies take reasonable steps to verify that such investors are accredited, and gives companies more flexibility to plan their access to public markets and incentivize employees.

Additional Initiatives Announced Today to Promote Capital Access and Investor Protection

• Monitoring of JOBS Act Implementation:  The President is directing the Treasury Department, Small Business Administration and Department of Justice to closely monitor the implementation of this legislation to ensure that it is achieving its goals of enhancing access capital while maintaining appropriate investor protections. These agencies, consulting closely with the SEC and key non-governmental stakeholders, will report their findings to the President on a biannual basis, and will include recommendations for additional necessary steps to ensure that the legislation achieves its goals.

• Crowdfunding Platforms Commit to Investor Protections:  In a letter to President Obama, a consortium of crowdfunding companies are committing to work with the SEC to develop appropriate regulation of the industry, as required by the JOBS Act.  Members of this leadership group are committing to establish core investor protections, including an enforceable code of conduct for crowdfunding platforms, standardized methods to ensure that investors do not exceed statutory limits, thorough vetting of companies raising funds through crowdfunding, and an industry standard “Investors’ Bill of Rights.”

Readout of the President’s Call with Baylor University’s Women’s Basketball Coach Kim Mulkey

Today, President Obama called Coach Kim Mulkey to congratulate her and the Baylor University women’s basketball team on their historic 40-0 season and 2012 NCAA championship victory.  The President told Coach Mulkey that her team was a great pick as he had the Lady Bears picked to win the championship from the beginning of the tournament.  President Obama told Coach Mulkey that he looked forward to seeing her and the team at the White House later this year.