SEC Publishes Data on Regulation A, Crowdfunding Offerings, and Private Fund Beneficial Ownership Concentration

Washington, D.C.--(Newsfile Corp. - May 28, 2025) - The Securities and Exchange Commission’s Division of Economic and Risk Analysis has published three new reports that provide the public with information on capital formation and beneficial ownership of qualifying private funds.

The first two papers—analyses of the Regulations A and Crowdfunding markets—provide valuable information on how capital is being raised in the United States particularly by smaller issuers. During the periods reviewed (2015 to 2024 for Regulation A and 2016 to 2024 for Regulation Crowdfunding) more than $10 billion was raised.

The third paper—an analysis of beneficial ownership concentration and fund outcomes for qualifying hedge funds (QHFs) and their advisers from 2013 to 2023—provides information on the interaction of beneficial ownership concentration, portfolio liquidity, investor liquidity, fund leverage, performance, and margins.

“Today’s reports provide key information on the capital markets,” said Robert Fisher, Acting Chief Economist and Director of the SEC’s Division of Economic and Risk Analysis. “Understanding how capital is being raised and the interaction of ownership concentration with fund outcomes for private funds informs not only the Commission but the public about essential parts of our markets.”

The three reports issued today are:

• Analysis of the Regulation A Market: A Decade of Regulation A provides statistics on the state of the Regulation A offering exemption over the past decade. It documents the level of offering activity and reported proceeds as well as the characteristics of issuers and offerings relying on this exemption. There were more than 1,400 offerings during this period seeking an aggregate of more than $28 billion in capital. Approximately $9.4 billion in proceeds was reported by more than 800 issuers. A typical Regulation A issuer was relatively small and young, and most issuers had not yet established a record of profitability.
• Analysis of Crowdfunding Under the JOBS Act provides an analysis of offering activity in the Title III securities-based crowdfunding market between May 16, 2016, (effective date of Regulation Crowdfunding) and December 31, 2024. During this period, there were more than 8,400 offerings initiated by more than 7,100 issuers, excluding withdrawn offerings. The offerings sought a total of approximately $560 million based on the target (minimum) amount. However, almost all offerings had a minimum-maximum format and accepted oversubscriptions up to a higher maximum. In the aggregate, the maximum amount sought in these offerings was approximately $8.4 billion. Based on the analysis of Electronic Data Gathering, Analysis, and Retrieval (EDGAR) filings during this period, there were more than 3,800 offerings where issuers reported proceeds; in total, they reported approximately $1.3 billion in proceeds. The crowdfunding exemption has continued to gain momentum over time and serves small and early-stage companies seeking access to capital, often for the first time. The median issuer had approximately $80,000 in total assets, including $13,000 in cash, $60,000 in debt, and $10,000 in revenue, and three employees.
• Beneficial Ownership Concentration and Fund Outcomes for Qualifying Hedge Funds  provides statistics describing the relationship between beneficial ownership concentration and fund outcomes for QHFs and their advisers from 2013 to 2023. Over this period, concentrated funds exhibited faster growth than unconcentrated funds. Concentrated funds hold more liquid assets and offer more liquidity to investors relative to unconcentrated funds, though both portfolio and investor liquidity have declined over the sample period. In addition, the gross return of unconcentrated funds is on average 1.2% higher than concentrated funds, but their net return is only 0.1% higher indicating that, on average, the gross performance advantage of unconcentrated funds is offset by higher margins.

The Division of Economic and Risk Analysis integrates financial economics and rigorous data analytics into the SEC’s core mission. It conducts detailed, high-quality economic and statistical analyses to advise on Commission matters and helps identify and respond to issues, trends, and innovations in the marketplace.