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SEC Expands “Accredited Investor” Definition

Scott Edward Walker

This past Wednesday, the Securities and Exchange Commission (SEC) adopted amendments expanding the definition of “accredited investor” to include individuals who hold certain professional certifications/licenses or have certain “credentials,” as determined by the SEC. Current Definition of “Accredited Investor”.

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Where would I go to invest in startups or emerging companies?

Gust

” and the second is “Are you an Accredited Investor by that country’s standards?” This will be changing next year, however, because of a new law called the JOBS Act of 2012 , which establishes a new, limited type of Crowdfunding for small companies and non-Accredited investors. Once the U.S.

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7 Steps To Finding Investors Aligned With Your Values

Startup Professionals Musings

Many aspiring entrepreneurs try to raise capital, without first understanding and complying with government and state rules for disclosure, securities registration, private offerings, and accredited investors. Prepare properly for meeting and closing with investors.

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8 Expectations Of Investors Who Risk Their Own Money

Startup Professionals Musings

By definition, angels are accredited investors, who invest their own money for a percentage of the business. Each has met legal securities minimums for net worth and professionalism, to reduce the risk to entrepreneurs. Their realm fits between crowdfunding and venture capital sources.

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Raising Capital? 3 Tips for Entrepreneurs

Scott Edward Walker

Introduction I’ve been helping entrepreneurs raise capital as a securities lawyer for 17+ years, and there are certain fundamental legal mistakes that I’ve seen entrepreneurs make over and over again. Fundraising Tips Tip #1: Only Offer and/or Sell Securities to “Accredited Investors”.

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The 5 Biggest Legal Mistakes That Startups Make

Scott Edward Walker

Mistake #4 : not complying with applicable securities laws (at 29:21). Mistake #5 : not doing your due diligence on potential investors (at 38:36). Mistake #4: Not Complying with Securities Laws. Rule #1 : only sell “securities” to “accredited investors” – why? (i)

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The 5 Biggest Legal Mistakes That Startups Make

Scott Edward Walker

i) Rule 506 preempts State law, which means all you have to do is file a Form D and pay a filing fee; and (ii) no disclosure requirement/PPM Possible to sell to “friends and family” (e.g., issues to address include: How have they treated their other portfolio companies? (i)