4 ms·
The law you're referring to is more about marketing investments. You're still free to give your friend 10k for a startup. It's to prevent boiler room style or
by octaveguin 9y ago
The law you're referring to is more about marketing investments.
You're still free to give your friend 10k for a startup.
It's to prevent boiler room style organizations that quite effectively convince people without much information that an investment is sound when it's not.
- igorgue 9y agoYou're still free to give your friend 10k for a startup. Uh? As a gift but not an investment on his company, that's illegal if you're not accredited.
- throwawaybbqed 9y agoWhat? I can't take 10K from my parents/friends and give them equity?
- girvo 9y agoDon't quote me on this, but there's a specific-ish exemption for family/friends if I recall correctly.
- nivertech 9y agothere are specific exemptions for family, for friends and for fools ;)
- rothbardrand 9y agoIt's highly limited. If you have 300 friends you can't take $10k from each, unless they are accredited.
- vernon99 9y agoThis is why syndicates exist. Not a problem at all. Edit: not the only reason why they exist :) but a major one. To explain a bit more: syndicates allow you to consolidate multiple investors (not necessarily acredited) in an investment vehicle that then owns a chunk of stock in the company.
- kobeya 9y agoThis is incorrect. Some unaccredited investments are allowed, and above certain thresholds it just triggers onerous reporting requirements. It is not illegal to make unaccredited investments. It is illegal to market/promote to unaccredited investors however.