S. 3342: Helping Angels Lead Our Startups Act of 2025

This bill, titled the Helping Angels Lead Our Startups Act of 2025 (or HALOS Act of 2025), aims to change certain regulations about how companies can promote their investment opportunities, particularly to angel investors. Here’s a breakdown of what the bill proposes:

Definitions

The bill defines key terms involved in its provisions:

• Angel investor group: This is a group of accredited investors who meet regularly to discuss and make investment decisions in early-stage companies. This group does not include brokers or investment advisors.
• Issuer: An issuer is a business entity seeking investment that is not involved in bankruptcy and does not fit into certain other restricted categories, like blank check or shell companies.

Changes to General Solicitation Regulations

The bill requires the Securities and Exchange Commission (SEC) to revise rules concerning general solicitation, specifically:

• Within six months of the bill becoming law, the SEC must modify the existing rules (specifically sections of Regulation D) to allow companies to present their investment opportunities at specific events without violating solicitation bans.
• These events must be sponsored by legitimate organizations, including government entities, educational institutions, non-profit organizations, or specific types of investment groups.

Conditions for Events

For the modified rules to apply, the events must meet several conditions:

• The event should not be held in a facility owned by a religious organization (with some exceptions).
• There can be no advertisements for specific investment offerings at the event.
• The event sponsor cannot provide investment advice, make investment recommendations, or take an active role in investment negotiations.
• Only reasonable administrative fees can be charged for attendance.
• The sponsor should not get paid for introductions to investors, nor can they take compensation that would mandate them to register as a broker or an investment advisor.
• A concise disclosure about the event and associated investment risks must be provided to attendees.

Communication Restrictions

The communication during these events must be limited. The issuer can mention that they are offering securities but cannot share specific details outside of the general type and amount of securities, the amount already subscribed for, or the intended use of funds raised.

Effect on Relationships

Attendance at such events does not automatically create a formal relationship between the issuer and attendees for future investment discussions. This means that just being present at the event does not imply that an investor has a prior connection to the company.

Implementation Timeline

The SEC has a set timeline to implement these changes, ensuring that the amendment to the regulations happens in a timely manner for interested parties.

Relevant Companies

• GV: GV (formerly Google Ventures) could see increased deal flow from startups seeking funding as more events become accessible for companies looking to pitch to angel investors.
• Snap Inc.: Snap may benefit indirectly if more startups lead to innovative integrations with their advertising platform.
• Apple Inc.: Apple may observe new startups emerging in the tech space that could become competitors or partners, particularly if they foster technology development.