{"id":7035,"date":"2014-05-19T12:00:00","date_gmt":"2014-05-19T16:00:00","guid":{"rendered":"https:\/\/www.wework.com\/creator\/?p=7035"},"modified":"2020-03-30T19:07:30","modified_gmt":"2020-03-30T23:07:30","slug":"legal-tip-investors-need-accredited","status":"publish","type":"post","link":"https:\/\/www.wework.com\/ideas\/professional-development\/legal-tip-investors-need-accredited","title":{"rendered":"Here\u2019s why your investors should be accredited"},"content":{"rendered":"<p>This is a complex question. The answer really depends on the facts and circumstances. For example, the information below assumes that the company is privately held and does not otherwise wish to engage in a public offering like an IPO. So you need to get good legal advice to determine the best answer for you.<\/p>\n<p>Technically it is not always required that all of your investors be \u201caccredited investors.\u201d However, whether legally required or not, it is almost always the case that it makes good business sense for private companies to only raise money from \u201caccredited investors.\u201d<\/p>\n<p>The term \u201caccredited investor\u201d is defined by <a href=\"http:\/\/www.sec.gov\/investor\/alerts\/ib_accreditedinvestors.pdf\">rules of the SEC<\/a>. An individual can be an \u201caccredited investor\u201d if it meets certain income or net worth thresholds. Companies, partnerships and other entities can also qualify as \u201caccredited investors\u201d if they satisfy the SEC\u2019s rules.<\/p>\n<p>While the SEC\u2019s rules relating to fundraising are somewhat complicated, raising money only from \u201caccredited investors\u201d has a number of significant advantages that will save you time, money and a lot of potential headaches now and in the future. For example, raising money from unaccredited investors would generally require you to prepare a lengthy, technical and detailed disclosure document. Complying with those disclosure rules can be very expensive and time-consuming at a time when your business wants to raise money quickly and inexpensively. Further, allowing unaccredited investors to purchase securities from your company can create complex issues down the road when raising additional money or when your company is acquired. For these and many other reasons, you should typically avoid raising money from unaccredited investors.<\/p>\n<p><em>Attorney Advertising. Prior results do not guarantee a similar outcome. Photos within are not of clients or firm personnel.<\/em>\u00a0<i>\u00a9 2014 Wilmer Cutler Pickering Hale and Dorr LLP.<\/i><\/p>\n","protected":false},"excerpt":{"rendered":"<p>This is a complex question. The answer really depends on the facts and circumstances. For example, the information below assumes that the company is privately held and does not otherwise wish to engage in a public offering like an IPO. So you need to get good legal advice to determine the best answer for you. [&hellip;]<\/p>\n","protected":false},"author":915,"featured_media":7036,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[43902],"tags":[],"class_list":["post-7035","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-professional-development"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.4 (Yoast SEO v25.3.1) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Here\u2019s why your investors should be accredited<\/title>\n<meta name=\"description\" content=\"This is a complex question. The answer really depends on the facts and circumstances. For example, the information below assumes that the company is priva\u2026\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.wework.com\/ideas\/professional-development\/legal-tip-investors-need-accredited\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Here\u2019s why your investors should be accredited\" \/>\n<meta property=\"og:description\" content=\"This is a complex question. The answer really depends on the facts and circumstances. 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