Technically it often is. The SEC never really cared because historically friends+family funded businesses didn't end up on the market.
Your typical neighborhood Italian restaurant doesn't IPO. If it did, and grandma who gave you her famous meatball recipe, turns up with her team of IP lawyers things will get interesting
The difference here is that you are inviting 1000s of random people to invest. Then even assuming you are totally honest and above board - once you are marginally succesfull the same VCs will come and screw these investors in the same way that they screw foudners.
The difference here is that you are inviting 1000s of random people to invest. Then even assuming you are totally honest and above board - once you are marginally succesfull the same VCs will come and screw these investors in the same way that they screw foudners.