What is Regulation D 506(c)
Regulation D 506(c) is a new exemption that, like 506(b), allows startups to raise an unlimited amount of capital solely from accredited investors, with the main difference being these companies can advertise their raise to the public and raise it online.
The downside, however, is that startups/platforms using 506(c) must verify all investors are qualified to invest under this exemption (compared to 506(b) where investors may self-certify). The burden lies on investors to provide proof they are accredited via tax returns and bank statements. You can find a detailed version of 506(c) and a list of verification methods that issuers of 506(c) may use here.
The KingsCrowd Advantage
With over 50 platforms like Republic, Wefunder, and SeedInvest, you can easily get overwhelmed with the small differences between each platform. Additionally, there are thousands of entrepreneurs hoping to get investors from across America to support their ideas and businesses. Accredited investor or not, KingsCrowd covers deal flow for both accredited and non-accredited investors. No matter who you are, we want to provide unbiased, institutional grade research and analytics for every company across all platforms. Signup for KingsCrowd here to access the best analysis and research on the online private markets.
Wallstreet has Morningstar, S&P, and Bloomberg
The equity crowdfunding market has KingsCrowd.
About: Francis Vu
An investment professional with a background in private equity and venture capital having spent time conducting investments at VU Venture Partners and Pacific Oak LLC with a finance and management degree from Tulane University.