What is a "Non-Accredited' Investor? | InvestReady

What is a "Non-Accredited' Investor?

A "Non-Accredited" investor refers to a new type of investors that is allowed to invest in private equity but with limitations. Anyone that falls below the "Accredited" investor threshold is considered a non-accredited investor. 

Previously (since 1933), private equity investing has been exclusive to "Accredited" investors. Thanks to the JOBS Act (2012), the SEC has "updated" this legislation.

There are 2 new ways non-accredited investors can access private equity opportunities for the first time in over 80 years. 

As of June 19th, 2015, any US Citizen is qualified to participate in a Reg A+ (title IV) offering which can raise up to $50,000,000 from both accredited and non-accredited investors. If you are not considered "Accredited" then you will face an annual investment limit based on your annual income and net worth. You will be able to invest 10% of the greater of the two numbers. 

As of May 16th, 2016 - Anyone in the world is allowed to invest in a Reg C offering which can raise up to $1,000,000. Reg C is also known as Title III and is often referred to as THE equity crowdfunding law. Regardless of your "Accredited" status, you will face either an annual investment limit depending on your income or net worth. You will need to calculate which is the lesser of the two and if it's under $100,000, you have a restriction of 5% of that number to invest, or if it is greater than $100,000 you have a restriction of 10% of that number to invest. Everyone has a minimum of $2,000 that they can invest.

Your annual investment threshold resets annually and is separate from each other. This means you cannot combine your limits and invest it all in one offering type. 

InvestReady will help you stay within the walls of compliance while also aggregating these deals for you in one place. If you are a non-accredited investor, sign up and see which Reg A+ or C deals you qualify for today!