The legal implications of AI in startup fundraising: a Memorial Day 2023 story

How to Raise Under Reg CF

If you are looking to raise, but are not ready to go public, the answer is (somewhat) simple: find the applicable exemption from registration.

Rule 506(b) is a popular exemption from registration, as it allows companies to raise an unlimited amount of money from accredited investors and up to 35 non-accredited investors

One common method for a startup to raise its initial funds without registration with the SEC is reliance upon Section 4(a)2 of the Securities Act.

Rule 506(c) is a prominent exemption from registration as it allows companies to raise an unlimited amount of money from accredited investors; unlike under Rule 506(b), the securities offered by a company relying on Rule 506(c) may not be sold to any investor that is not accredited.