RACE Act of 2025

This bill would make it easier and faster for small and growing companies to raise money using Regulation A “Tier 2” offerings. If a company already had one Tier 2 offering qualified by the SEC, then new, similar offerings could be automatically approved as soon as they are filed—no extra waiting—if they meet certain limits. Each new class must be under $5 million, be substantially similar to the earlier class, and the total raised across these new classes in the past year must stay within the overall Tier 2 annual cap. The bill also says “substantially similar” securities don’t have to have the exact same terms to qualify as similar.

What this means in practice: companies could launch follow-on offerings more quickly, which may lower costs and speed access to capital, while still keeping dollar limits in place to protect investors.

• Who is affected: Small and mid-sized businesses using Regulation A Tier 2; individual investors considering these offerings.
• What changes: Follow-on, similar offerings are deemed qualified upon filing if each is under $5 million, they are substantially similar to a prior qualified class, and the total over 12 months stays within existing Tier 2 limits; “similar” offerings don’t need identical terms.
• When: Would apply to eligible filings after this becomes law; the deemed qualification happens upon filing if the conditions are met.