Perspectives On Investing

Business Opportunity: In Search Of The New

When looking for the next big industry, the one constant is constant change

Corporate Finance Attorney Laura Anthony discusses staying ahead of the curve as new business sectors emerge. Visit here for more information.

WEST PALM BEACH, Florida, Feb. 25, 2020 /PRNewswire/ — Every profession has its own specific demands, many of which seem daunting to those in another line of work.

Physicians are required to work in close contact with patients infected with increasingly virulent pathogens. Fund managers must make decisions that can result in exhilarating success or dismal failure, and attorneys must consider every possible plan of action in helping advise their clients on which option will result in the most beneficial outcome.

The more enviable the profession, the higher the degree of expectation imposed upon the professional.

In the field of corporate and securities law, the demands put upon associates and partners can be particularly vexing. Attorneys are required to not only know the law, but to become micro-experts in the businesses they service. This may sound simple, but corporate law firms represent private and publicly traded companies from sectors that emerge and evolve so quickly that they cannot be anticipated. There is no “warm-up” time before jumping headfirst into the deep water.

New Sectors Emerge

In the past decade, renewable energy, immunotherapy, cannabusiness, blockchain and distributed ledger technology are just a handful of burgeoning sectors that attracted and motivated entrepreneurs to go forth and stake their claims. These previously unknown sectors become so hot so fast that even the insiders have difficulty staying current. The outsiders, in this case corporate attorneys, must work even harder to become turnkey experts, or at least keenly informed advisors.

Attorneys have a rather erroneous reputation for speaking at length when brevity would suffice. Today’s sought-after corporate attorneys, those who grow more experienced and effective as business sectors rise and fall, have the ability to listen at great length before rendering counsel.

Attorney Laura Anthony is the founding partner of Anthony L.G., PLLC, a corporate law firm based in West Palm Beach, Florida. For more than 20 years, Ms. Anthony’s firm has worked with clients in virtually every conventional and up-and-coming business sector. Throughout it all, Ms. Anthony has adapted to the demands of Newco’s while staying abreast of the federal regulations that govern them.

“Business moves fast, and it’s only getting faster,” Ms. Anthony said. “There is no such thing as stasis. The one constant that can always be relied upon is change. This may sound paradoxical, but it is most definitely accurate. By the time our attorneys are familiarized with immunotherapy R&D companies and the manner in which they operate, a new breed of companies in the cannabis sector surface. It should be known that new sectors do not emerge in an orderly and linear fashion; in many cases, two or three will emerge simultaneously. All of our partners and associates have one thing in common: they can all maintain the ‘all-hands-on-deck’ mindset indefinitely. We’re all servicing and learning simultaneously; there’s never an opportunity for complacency, which is actually a good thing.”

The Rise and Fall of Wind Farming

Shortly after founding Anthony L.G. in 2001, Ms. Anthony found it necessary to ramp up quickly on wind farming, an industry that has waned in emerging growth popularity.

In response to a public demand for clean energy and a series of tax credits ratified by Congress, large wind turbines appeared across the landscape of the Midwest almost overnight. At one point, wind farming accounted for nearly 4.1 percent of America’s electricity. Wind farming quickly became another gold rush scenario.

Innovators attracted speculators and everyone wanted a piece of the business that was going to lessen domestic dependence on the import of fossil fuels. Many of these startup companies grew faster than was sustainable; some never got off the ground, and some intended to raise precious growth capital by accessing the public markets via one or more going public scenarios.

“It was as if everyone with business savvy decided it was imperative to either start a wind farming company or at least back one,” Ms. Anthony recollected. “We were inundated with hundreds of queries, some of which became established clients, and everyone needed immediate attention. The firm was brand-new and the paint had barely dried on the walls, and there was a tidal wave of new business. It was like trying to jump and duck at the same time, so we memorialized a system to handle the sudden influx in order to maintain organizational stability. I knew that this type of boom would happen many times in the future, so we really torqued down on being ready for the next big thing to come down the pike.”

Cannabusiness

Wind farming came and went but was quickly replaced by smaller booms until one day the term “cannabusiness” was coined.

“The cannabis industry is another prime example of how fast a new sector can gain momentum,” Ms. Anthony said. “There were many aspects to it and while some clients were intent on capitalizing on the emerging recreational market, others were focused on medical applications. It was an overnight sector; people are extremely enthusiastic about the possibilities, but pure-play medical and recreational marijuana companies are two completely different animals. Once again, we went to work and adapted quickly, but this time we were better prepared.”

The Cryptocurrency Boom

There is no such thing as stasis. The one constant that can always be relied upon is change. It should be known that new sectors do not emerge in an orderly and linear fashion; in many cases, two or three will emerge simultaneously...

Currently, Anthony L.G. handles many cryptocurrency clients. Cryptocurrency literally became an overnight business sector for corporate and securities lawyers, shifting from the technology sector with the SEC’s announcement that a cryptocurrency is a security in its Section 21(a) Report on the DAO investigation. Since then, there has been a multitude of enforcement proceedings, repeated disseminations of new guidance and many speeches by some of the top brass at the SEC each evolving the regulatory landscape.

Business sectors are booming for digital assets and blockchain technology. Amazing new networks are being built and traditional applications are being disrupted at every turn. However, the ability to publicly issue the digital tokens that drive these networks continues to challenge the best practitioners, with all avenues leading back to some from of registration. The SEC’s temporary injunction against Telegram and its Grams digital token, the one token everyone firmly believed was a pure utility, together with the successful Regulation A mini registration of Blockstack’s token, solidified the current road map to issuance.

However, this is just the beginning. SEC Commissioner Hester Peirce, known as “Crypto Mom,” has called for a temporary safe harbor allowing tokens to effectively be exempted from the securities registration requirements as long as certain conditions are met. Further, on the near horizon, more than 20 new pieces of crypto legislation will be discussed by the U.S. Congress during 2020.

Currently, those who operate in the digital asset space must carefully navigate rough, uncharted waters while doing everything possible to comply with federal regulations. Some of these new regulations are clearly understood (a token is a security for example) while others are in the formative stage, forcing cryptocurrency players to maintain an almost “predictive” compliance.

This is all rather technical, so here’s how it looks on canvas: the crypto sector is growing so quickly, it makes the gold rush of 1849 look like a yawning festival; the technology that drives crypto is more complex than Chinese algebra; and a considerable portion of the federal regulations that govern, or will govern, the entire shooting match are not yet drafted. Should a crypto player do something today, they may be found liable for violating a statute that is written tomorrow.

Anticipating The Unanticipated

Regulatory forecasting isn’t feasible during a boom; the corresponding statutes that are ultimately implemented are complex. However, Ms. Anthony’s experience in anticipating the unanticipated has yielded a structured, conservative, formulaic action plan to help guide the firm’s clients.

The firm’s strategy for maintaining regulatory compliance in times when regulations are still being finalized is sometimes referred to internally as “improvide.”

“This is nothing new so we stay agile and alert,” Ms. Anthony said. “We are responsible for helping our crypto clients maintain compliance at a time when the regulatory landscape is constantly shifting. Since it is impossible to predict what regulations the SEC will impose on the crypto sector, the most effective action plan combines experience and fundamentals. The SEC’s primary goal is to protect the investment public; historically they have accomplished this by requiring operational transparency. Take that fundamental, factor in a strong working knowledge of the crypto sector, and then add some common sense, and we now have a tenable, structured platform to operate from.”

Ms. Anthony credits her partners and associates for their diligence and exemplary ability to adapt when new sectors roar. There is a standard at ALG that requires attorneys to know as much, if not a bit more, than their clientele about their specific areas of commerce in addition to the laws that govern them.

“Today it is cryptocurrency and cannabis, tomorrow it could be anything.”

 

 

 

About Attorney Laura Anthony
Laura Anthony, Esq. is the founding partner of Anthony, L.G., PLLC, a national corporate, securities and business transactions law firm. For more than two decades Ms. Anthony has focused her law practice on small and mid-cap private and public companies, capital markets, NASDAQ, NYSE American, the OTC markets, going public transactions, mergers and acquisitions, registered public and exempt private offerings and corporate finance transactions, Regulation A/A+, securities token offerings, Exchange Act and other regulatory reporting requirements, FINRA requirements, state and federal securities laws, general corporate law and complex business transactions. The Anthony, L.G. PLLC team has represented issuers, buyers, sellers, underwriters, placement agents, investors, and shareholders in mergers, acquisitions and corporate finance transactions valued in excess of $1 billion. ALG has represented in excess of 200 companies in reverse merger, initial public offering and direct public offering transactions. Palm Beach Attorney Laura Anthony is also the creator and author of SecuritiesLawBlog.com, the host of LawCast™, Corporate Finance in Focus and a contributor to The Huffington Post and Law360.