The SEC Just Voted To Lift The Ban On General Solicitation

I think you are correct but only if you consider everything in aggregate.

There will be channels set up that will significantly boost the signal to noise ratio that could not exist under current rules. Channels like crowdfunding sites that /will/ collect information that the SEC might not require but will be useful for potential investors.

I, for one, will be seeking out these channels and vetting them for myself and will recommend the same to anyone who asks.

There is going to be turbulence while people find the balance but I still think this will be an overall win.

For one thing, I expect it to continue the trend of shifting the balance of power from investors to founders. Basically, this will be a huge amount of new competition for angel investors. And crowdinvestors don't have voting rights or a board seat. In order to continue to get into deals they want, angels and VCs will have to bring more value to the table and accept less favorable terms. So I would guess, anyway.

On the other hand, it isn't necessarily going to be a river of cash for anyone who wants it. Along with the art of pitching to individual investors, one will also have to learn the art of pitching to the crowd -- and will be competing against everyone else doing the same thing. I expect to see a small industry of companies assisting founders in this new kind of marketing.

We've gotten accustomed to freedom of speech when it comes to political matters, but we tolerate all sorts of restrictions in commerce. The SEC has basically said in the past that if you are raising money and want to talk about it, you're only allowed to talk to certain people at certain times and not others. Same with direct to consumer advertising of drugs. The FDA was essentially saying that pharmaceutical companies could only talk to doctors about what they have on offer, not patients.

More recently (and less of a hot-button issue) the FDA got smacked down by an appeals court for their restrictions on what pharma sales people could tell doctors about off-label use of drugs (that is, drugs used in a manner not approved by the FDA). The FDA has said in the past that it's illegal for sales reps to promote off-label uses of drugs to doctors. This is true even in cases where these off-label uses are written up in the medical literature. Note that it has never been against FDA regulations for anyone else to tell the doctors about off-label use of drugs (e.g. other doctors, the janitor, Hollywood celebrities, etc...). The courts have basically said that this is a first amendment violation because it places limits on specific individuals when society as a whole benefits from the free, unrestricted flow of truthful medical information.[1]

[1]http://www.reuters.com/article/2012/12/04/us-offlabel-convic...

Sure it is.