Small investors looking for a slice of young companies can for the first time begin buying stock at a start-up's earliest stages under a new provision of the JOBS Act that took effect on Friday.

The latest element of the 2012 law, designed to expand small businesses' access to capital, sets the stage for so-called "mini-IPOs." Companies seeking up to $50 million can test the waters, gauge interest among a wider range of investor, and ultimately file for an initial public offering with relatively fewer hurdles.

For entrepreneurs, it's an alternative to hunting down venture capital, relying on crowdfunding or holding a full-fledged IPO. For consumers, it opens early-stage stock purchases to more than just wealthy accredited investors: those whose net worth is more than $1 million or who made more than $200,000 in each of the previous two years.

The process is still lengthy: Companies must disclose two years of audited financials––or for younger companies, as many as they have––and management has to undergo bad-actor checks. And for the smallest IPOs, those less than $20 million, sign-offs are required from every state in which a deal is marketed.

The process could cost up to $100,000, a sizable amount for a fledgling company.

"This really isn't set up for the true start-up, the guy in his garage who just invented the cool widget," said Kendall Almerico, an attorney and JOBS Act expert in Alexandria, Va. "This is for the guy in his garage who invented the cool widget, started the company . . . started to get a little traction, and now wants to take it to the next level."

The law kicks in just as the once red-hot U.S. IPO market has cooled. After topping out in 2014 at a 14-year high of $93.6 billion in proceeds on 276 deals, data from Thomson Reuters Deals Intelligence shows IPO proceeds are down by more than half so far in 2015 and deal volume is off by 42 percent.

Few expect mini-IPOs to make much of a dent, at least at first.

"I don't think it will make that much of a difference," said Francis Gaskins, president of IPO research firm in Marina del Ray, Calif. “You have IPOs above $50 million, that's a different category. Below $50 million, you have a lot of crowdfunding going on. This will just fill that gap."

Other hindrances include substantial lead time and the fact that stocks of small companies are thinly traded, on average.