When the Jumpstart Our Business Startups (JOBS) Act was adopted by Congress earlier this year, the promise of locavesting—locally focused investing—gained a lot of momentum. As noted in our previous article, locavesting holds a lot of promise for small businesses that need capital to grow.

The JOBS Act details still need to be ironed out and there are plenty of devils hanging out in those details. But there are some fundamental things you can do right now to get your business ready for new locavesting opportunities coming down the pike. The nice thing about each of these tips is that they are things you should already be considering as your business evolves, not just to prepare for interested locavesters.
 

Consider Incorporating

Regardless of the final rules, the opportunities for equity investment via the JOBS Act will require that your business be set up as a C corporation. If your business isn’t set up as a C corporation, it’s easy to change the entity type. Start checking out business advisors and lawyers for the professional support you need to make the change in status.
 

Make Sure Your Records Are in Order

Raising money via locavesting means that your business record keeping and the financial statements for your business need to be sound and reliable. In some cases, having those statements certified by a CPA may be a requirement for seeking investment. If you don’t have a CPA, it may be worth shopping for one now and having your financial records professionally reviewed.
 

Be Clear on Your Needs and Plans

As with any fundraising for your business, you need to have a clear sense of what money you need and for what purposes. Since you will be asking people to invest in your business and your plans for the future, there should be no confusion on what your business is and what you need. Make sure you've perfected your pitch with trusted friends, family members and professionals before venturing into the world of investors.
 

Stay Informed

The rules on how the JOBS Act will be implemented are evolving but the 24/7 news cycle never ends! Follow locavesting news but make sure you are getting your information from dependable sources. A couple of websites recommended by Matthew Abts of OregonStartup.com for JOBS Act news are Crowdsourcing.org and VentureBeat. (And speaking of Abts, I highly recommend checking out his recent CAKE talk for more background on crowdfunding and locavesting.)

At the end of the day, the promise of locavesting and what it can do to support small businesses and create jobs is huge.

Are you considering locavesting as an opportunity to grow capital for your business?