Democratizing Startups

President Obama signed the Jumpstart Our Business Startups (“JOBS Act”) of 2012 into law to “help entrepreneurs raise the capital they need to put Americans back to work and create an economy that’s built to last.” The goal is to “democratize startups” by making capital available to diverse entrepreneurs in new geographies. Yet the net effect of securities regulations and market conditions is the opposite. Startup companies are encouraged to stay private so capital is consolidating in large, mature firms instead of recycling into new startups. Evidence of consolidation is that once-rare “Unicorns” (billion-dollar startups) now number at least 170. More money is going into huge private companies, yet total venture capital investment is flat, so less is going to new startups. This could stall out the innovation economy. Democratizing startups requires safe-harbor exemptions from securities regulations for both original issuance and resale of stock, but securities regulations do not permit resale on exchanges. This Article proposes “Rule 144B,” a regulatory provision that could be enacted without an act of Congress, to permit transparent web-based venture exchanges with fraud-prevention intermediaries termed “independent analysts.” This Article answers the SEC’s call for rulemaking comments and informs Congress’s new work on JOBS Act 2.0

The Ontological (In)security of Similarity: Wahhabism versus Islamism in Saudi Foreign Policy

It has long been argued that identity matters in international relations. Yet, how identity impacts enmity and conflict among states remains the subject of debate. The existing literature asserts that differences in identity can be a source of conflict, whereas convergence and similarity lead to cooperation. Nevertheless, empirical evidence from the Middle East has long defied this hypothesis. The Kingdom of Saudi Arabia, which prides itself on being an Islamic model and claims Islamic leadership, has opposed the rise to power of Islamist movements in the Middle East. To address this paradox, this article builds on the growing literature on ontological security to propose a theoretical framework explaining how similarity can generate anxiety and identity risks. This framework, I argue, moves beyond traditional regime‐security approaches to reveal that security is not only physical but also ontological. I then illustrate the argument through a comparison of Saudi identity risks in the wake of the Iranian revolution (1979) and the ascendance of the Muslim Brotherhood to power in Egypt (2012). Ultimately, these cases provide intriguing insights into foreign policy behaviour during critical situations