CNBC's own piece on crowdfunded equity opened with the very dream that anyone investing through Title III of the JOBS act; that you could have the first money into a potential multi-billion dollar company. The SEC's ruling is attractive based on the idea that you could have a chance of being a future Peter Thiel (an early investor in Facebook) or Jason Calacanis (an early investor in Uber), turning a small investment into a huge boom. The ruling means that theoretically anyone with $100 or more could invest in companies that personally interest them, much like someone can back an Indiegogo (who have been planning to take advantage of crowdfunded equity since the announcement of Title III) project. It has a great deal of positives, such as eliminating the sadness that many feel when a major crowdfunded project (such as Oculus) is acquired for millions, if not billions, as well as giving regular investors the chance to get in on startups.

A danger to many should be the harsh truth of the crowdfunding industry; most campaigns fail. The well documented failure of the $3.5 million Zano drone is only one part of a larger story of the many failures of crowdfunding projects. PCMag's Robert Strohmeyer reported that over 40,000 Kickstarter projects fail to reach their goal, though this doesn't include the many that reach their goal then fail their customers. Even great successes like the Coolest Cooler have left users waiting. One key difference is that your participation with a crowdfunded equity investment isn't going to necessarily (though on some platforms it does) net an immediate reward or return, leaving you waiting for either a liquidity event or the chance to sell said stock on the secondary market. You must also assume that the company, like so many crowdfunded product failures, won't fail to generate a significant enough valuation for you to exit, or fail entirely.

This risk is only compounded by the limitations of the Title III ruling, with a certain amount of investors and amount of money raised through the crowd taking your company "public" without the benefits of the markets. This reason, among others, is why companies like CircleUp (who describe themselves as a "private equity marketplace" of accredited investors) and FundersClub, a venture capital firm that makes up parts of investments using accredited investments along with traditional VCs, won't be pursuing investments under Title III.

"The way the rules are set up, companies have to jump through way more hoops than they would compared to if they take VC and angel investor capital, or capital from online platforms like ours that follow long-established VC regulations," said Alex Mittal, CEO of FundersClub. "Due to this, an adverse selection filter has been created whereby for the most part, companies pursing Title III funding are the ones that failed to attract non-Title III online platforms, angel investors, and VCs. The biggest negative is the unintended consequence of making Title III the option of last resort." CircleUp, though not a traditional VC by their own description, also saw the same problem. In a blog post in May, saying that they believe "that Title III will be used less frequently because of the regulations in place for small businesses, or because it may be pursued only as a last resort by entrepreneurs...leaving [investors] with a pool of lower quality deals involving companies that could not obtain funding through the more efficient process."

They may be onto something. The landscape of Title III may not universally be negative, but browsing for deals on sites such as WeFunder, investors may question companies such as "notebooks from the future" using the platform as the aforementioned last resort when traditional capital isn't available. Tanya Prive, in a column for Forbes, also echoed some of their sentiments, estimating the costs to be tens of thousands for some startups to file, even when limited to $1 million in funding in one 12-month period.

To Mittal, those that are pursuing Title III funding may have a greater problem; that they're simply not pushing the right buttons with the investors they want. "If your fundraising message is not resonating with angel investors, take a good look at both your pitch and your business and fix any weak areas, then go out again for funding after having addressed those areas. And/or consider bootstrapping. I'd recommend both these approaches over Title III."