On 30 January 2025, the United States Securities and Exchange Commission (US SEC) announced that its Small Business Capital Formation Advisory Committee will convene on 25 February 2025 to discuss capital-raising challenges for emerging fund managers and obstacles faced by small public companies that are not listed on a national securities exchange. The meeting agenda, titled “Meeting of SEC Small Business Capital Formation Advisory Committee,” outlines topics for discussion, including insights from industry experts and potential policy recommendations to address these issues. The public can view the live proceedings via webcast on the US SEC official website.
The Small Business Capital Formation Advisory Committee was established to advise the US SEC on policy matters affecting small businesses, including capital-raising regulations, public market accessibility, and the challenges faced by smaller financial players. The 2025 meeting follows the committee’s previous engagements on similar topics, with a continued focus on strengthening market participation for small and emerging entities.
During the morning session, the committee will hear an update from the US SEC’s Office of the Advocate for Small Business Capital Formation, which will present its FY2024 Annual Report. This report contains data on capital-raising activity from early-stage startups to small-cap companies, along with policy recommendations. The committee will then continue its exploration of strategies to support emerging fund managers, expanding on discussions held during a previous meeting on 13 November 2024. To facilitate these discussions, committee members will hear from Ashok Kamal, Executive Director of NuFund Venture Group, and Sara Zulkosky, Co-Founder & Managing Partner at Recast Capital.
In the afternoon session, the committee will turn its focus to small public companies with market capitalisations of $250 million or less that are not listed on a national securities exchange. These companies represent a substantial segment of publicly traded firms, yet they often face barriers in accessing capital and attracting investor participation. The committee will examine the decision-making processes and challenges confronting these businesses, with insights provided by Dan Zinn, General Counsel and Chief of Staff at OTC Markets Group.
For emerging fund managers, accessing capital remains a persistent challenge, particularly due to institutional barriers, regulatory complexities, and investor hesitancy in allocating funds to newer firms. The committee’s previous discussions in November 2024 identified areas of concern, and the upcoming meeting aims to deliberate further on potential policy recommendations to ease these challenges.
For small public companies, the absence of a listing on a national securities exchange can create difficulties in securing investment and maintaining market liquidity. The committee will examine why some companies choose to remain off-exchange and explore strategies to improve their capital access. The discussion will involve perspectives from the OTC Markets Group, which facilitates trading for many such firms.
The morning session will begin at 10:00 AM ET with introductory remarks from US SEC commissioners and newly appointed committee members. This will be followed by an update from the Office of the Advocate for Small Business Capital Formation, offering insights into the capital-raising environment for startups and small-cap businesses.
At 11:00 AM ET, the committee will revisit the topic of emerging fund managers, with industry experts providing perspectives on funding obstacles, investment dynamics, and fellowship programmes aimed at addressing institutional barriers for underrepresented fund managers. The session will include a presentation from angel investors and industry practitioners, with discussion contributions from Ashok Kamal of NuFund Venture Group and Sara Zulkosky of Recast Capital.
After a break at 12:45 PM ET, the committee will reconvene at 1:45 PM ET to discuss the challenges faced by small public companies that are not listed on a national securities exchange. The session will feature insights from Dan Zinn of OTC Markets Group, who will provide an overview of the challenges and opportunities available to smaller public companies outside of major exchanges. The committee will then begin formulating potential solutions to enhance capital access and investor engagement for these firms.
The meeting will conclude at 3:30 PM ET, following a wrap-up session where committee members will reflect on the discussions and consider possible recommendations for regulatory improvements.
The committee’s discussions on 25 February 2025 are expected to contribute to future US SEC policy initiatives aimed at addressing capital-raising challenges. While no immediate regulatory changes will be enacted during the meeting, the committee’s findings and recommendations may influence forthcoming proposals or amendments to existing capital formation rules.
(Source: https://www.sec.gov/newsroom/press-releases/2025-35)
