Hi, I have a question. Thanks in advance for any answers!
Recently I developed a High Frequency Trading Algorithm, it's currently running live and making money with my own funds.
In order to expand I want to register a Delaware C-Corp with two share classes (one voting and one nonvoting). I would sell myself voting shares and some friends and family the nonvoting shares, then use the proceeds to trade algorithmically. Dividends would be distributed to investors.
I was informed by a lawyer that this may be illegal unless the investors are directly involved in the company or have a net wealth of over $1 million, similar to a hedge fund.
I am a bit confused as to why this might be the case, the money invested in the company would simply sit in a brokerage account presumably making money. The shareholders would own the money as well as all other assets related to the company (software and servers), just as if I started a retail or car service company.
Do you know if this is true or where I could find more information?
Thanks!
Recently I developed a High Frequency Trading Algorithm, it's currently running live and making money with my own funds.
In order to expand I want to register a Delaware C-Corp with two share classes (one voting and one nonvoting). I would sell myself voting shares and some friends and family the nonvoting shares, then use the proceeds to trade algorithmically. Dividends would be distributed to investors.
I was informed by a lawyer that this may be illegal unless the investors are directly involved in the company or have a net wealth of over $1 million, similar to a hedge fund.
I am a bit confused as to why this might be the case, the money invested in the company would simply sit in a brokerage account presumably making money. The shareholders would own the money as well as all other assets related to the company (software and servers), just as if I started a retail or car service company.
Do you know if this is true or where I could find more information?
Thanks!
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