Two SEC exemptions that govern how startups can raise from accredited investors — the difference is whether public solicitation is allowed.
Two SEC exemptions that govern how startups can raise from accredited investors — the difference is whether public solicitation is allowed.
506(b) is the traditional path: no general solicitation, but you can accept self-attestation of accredited status from investors with whom you have a pre-existing relationship. Most seed rounds use 506(b).
506(c) allows public solicitation (Twitter posts, demo-day pitches, open outreach) but requires verified accredited status — usually via a third-party verification like a CPA letter or a service like VerifyInvestor. Choose based on how you raise, not the other way around.
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