In order to advertise, you must do a registered securities offering with the CSI Securities Division. Our experience has been that start-up businesses have a very difficult time getting investors from the general public. Mostly, you will be relying on family, friends, and business acquaintances to invest in your company. One or more exemptions from registration may be appropriate for your needs.
"Security" is broadly defined. It includes all of the readily recognizable investment vehicles, such as stocks, bonds, limited partnership interests, and notes (including promissory notes), as well as lesser-known items. In general, any transaction that involves an investment of money in an enterprise, with an expectation of profits to be earned through the efforts of someone other than the investor, is a security.
In order to protect investors, Montana law requires that every security that is offered or sold must either be registered or subject to an exemption from registration. Many of the registration and exemption provisions require a filing to be made with the CSI Securities Division. The filing requirements depend on the registration or exemption provision relied upon. In some cases, the filing requirements may be minimal. In other cases, it will be necessary to file a disclosure document, typically called a "prospectus" or "offering circular," and various exhibits. Regardless of an issuer's filing requirements, the law requires that all material facts regarding the issuer and the offering be disclosed to prospective investors.
No. The Company must generally register or qualify for an exemption from registration in each state in which it wishes to sell. Issuers should also note that the federal government, through the Securities and Exchange Commission (SEC), also regulates securities. The federal system is similar to the state system in that federal registration is required unless an exemption from registration is available. Many issuers making an offering entirely within one state rely on an intrastate exemption from federal registration. An exemption could be lost by making offers or sales in more than one state. For information on federal securities regulation, contact the SEC's Office of Small Business at 202.942.2950 or
Registered offerings (SCOR, Regulation A, registration by qualification or coordination) must be sold by licensed securities salespersons. If no commissions will be paid to sell the shares, officers and directors of the issuer may exempt from licensing.
No. Our experience has been that most small offerings, particularly those under $1 million, are marketed by officers of the issuer. Broker interest in these small offerings has been very limited to date.

There are generally no rules stating that a company must be in business for a certain period of time before it can sell its securities, although there are rules that would make it difficult for a newly formed company to make a public offering of debt securities.

However be aware, a company without significant operating history may find it difficult to answer the questions on the Form SCOR. At the very least, a company should complete a thorough (and realistic) business plan before attempting to draft a securities disclosure document. Companies without significant operating histories may also have a more difficult time attracting investors to their offerings.

The fee is generally dependent on the dollar amount of securities that you wish to sell in Montana, though the maximum fee is $1,000.
There is no legal requirement that a lawyer be retained to fill out the Form SCOR. It will be necessary to obtain a legal opinion on the legality and validity of the offering. That is, an opinion that the corporation has been correctly formed and the securities will be legally issued. SCOR was designed as a "do-it-yourself" form. It is usually quite helpful, however, to at least get input from a lawyer familiar with securities matters. It is also smart to consult with a lawyer to make sure that your company is properly structured for your proposed offering.
We cannot recommend any particular lawyer. Lawyers who practice securities law generally practice with major law firms. You may wish to visit the Montana State Bar Association’s website at for a list of attorneys who practice securities law.