The mechanics of Klein's revolution were basic: Spring Street Brewing Co. simply put its offering prospectus on its Web site (http://witbeer.com). Potential investors could visit the site, learn about the company, download subscription documents and, if they were interested in investing, send a check to Spring Street.
Because it was the first deal of its kind, Klein's single press release about an Internet initial public offering (IPO) earned it a tornado of publicity in the national news media. With the publicity came visitors to the Web site, some 500,000 of them, and with the hits came the good stuff--checks in the mail.
Initially, the pace was furious, and Klein recalls taking in as much as $85,000 a week. By the end of 1995, Spring Street Brewing Co. had raised $1.6 million from 3,500 investors over the course of 10 months.
The Securities and Exchange Commission (SEC) quickly and easily gave Klein approval to post the prospectus and other offering documentation on the Internet. But the regulators were not at all pleased when, in March, Klein designed a series of bulletin boards that would allow shareholders to trade Spring Street common stock among themselves. After news of Spring Street's foray into Internet trading hit the national business media, which had a field day because of the implications of bypassing established stock markets, Klein found himself on a conference call with 11 SEC attorneys.