FundersClub said it received a no-action letter from the Securities and Exchange Commission. The letter suggests that the SEC will not take action against venture capital advisers who are not registered at broker dealers, the company said.

Ron Conway may have stepped back from funding Y Combinator startups, but FundersClub has stepped in. The online platform for seed investing said it raised a $1.1 million fund to invest in Y Combinator startups.

First Read brings you the latest headlines from the weekend touching on entrepreneurs’ greatest challenges; whether we need to rank biotech hubs and FundersClub’s crowdsourcing approach to venture capital.

Virool, a year-old San Francisco-based video advertising startup, has closed on $6.62 million in funding from a long list of investors in what the company claims is the biggest seed round raised so far by a graduate of the the Y Combinator incubator program. (Virool came out of the program last summer.) The company’s institutional investors include Draper Fisher Juvetson and Menlo Ventures; individuals who contributed to the funding include Paul Buchheit, Dave McClure, and Yuri Milner.

FundersClub said it completed investments in Coinbase, Sponsorfied and Tracks.by. The investments, along with those in Virool and FundersClub itself, are the first made by the online marketplace that lets accredited investors become equity holders in managed venture capital funds . The companies are among the Y Combinator summer 2012 batch. Investments by the 5-month-old investment platform now total $1.3 million.