Being a smaller company has its perks including the likely ability to be more agile in a dynamic market. However, at times smaller companies can face greater difficulty to build large lines of credit in order to stimulate growth as an organization. Without a bank willing to give them tens of millions of dollars at a low rate, these micro caps typically have to turn elsewhere for help. Luckily, under recent amendments to SEC Regulations A and CF, companies can raise capital quickly and painlessly by selling certain classes of shares to outside investors.
Worksport Ltd (OTCQB:WKSP) announced that they are launching a Regulation A offering in order to raise funds in order for further development and expedited launch of their TerraVis system, as well as existing product inventory. With a market cap of under $8 million, depending on what tier the company decided to go with, they can raise up to $20 million in a 12-month period (tier 1) or up to $50 million (tier 2).
Traders seemed to be excited about the news as they bought up shares to an early session high of $0.1498/share (+13%). If this move holds, that would be a breakout above the 10-day SMA, which would be a welcomed feat as the stock has been trending downward since its recent peak in early September.
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