If you're a small business and you're looking for potential investors, there's no longer any need to fill out stacks of SEC paperwork, 140 characters will do the job.

The Securities and Exchange Commission has approved new rules which make Twitter an acceptable medium for gaging investor interest. Under the new rules startups looking for $50 million a year or less may use tweets to inform potential investors that they are considering stock or debt offerings.

Traditionally the SEC has very formal rules which require businesses to directly inform them of any major steps they are taking involving money. However, in a world that now moves at the speed of social media they have been realizing that the old rules don't work as well anymore. In 2013 they changed their rules to allow companies to make earnings announcements via Facebook and Twitter, as long as they made investors aware that the announcement would be made there.

While these new rules are a welcome change it's difficult to say that this will make a huge impact on the bottom line for anyone. While most businesses are well aware of the power of social media, Twitter as a marketing tool has traditionally only moved in one direction, from the business to the consumer. As these new rules take effect we will see how successfully that same business can promote themselves in the other direction. Still, if somebody looking for the right startup to fund can find it with a simple hashtag, it may help some new businesses owners stand out among the crowd.

Image credit: Bloomua / Shutterstock.com