Rule 506(c) Expertise at FundWise
Maximizing Capital Raising Potential with Rule 506(c) Offerings
At FundWise, our experience in navigating Rule 506(c) of Regulation D sets us apart as a premier legal partner for businesses seeking effective capital raising solutions. Our understanding of securities law, combined with a strategic approach, set you up to have a successful raise under Rule 506(c).
Why Rule 506(c)?
Rule 506(c) of Regulation D presents an advantageous route for companies to raise capital. It’s an appealing choice due to several key benefits:
- Unlimited Capital Raising: There’s no cap on the amount of money you can raise under Rule 506(c).
- Accredited Investors Only: 506(c) allows you to publicly solicit and advertise your offering, provided you sell exclusively to accredited investors.
- Streamlined Process: Compared to other general-solicitation securities offerings, Rule 506(c) can be less burdensome in terms of regulatory compliance.
- No State Blue Sky Review: Offers made under Rule 506(c) are generally exempt from state securities law registration and review.
Our Expertise in Rule 506(c) Offerings
FundWise brings knowledge and experience to your Rule 506(c) offerings. Our services include:
- Compliance Review: We design your offering to be compliant with SEC regulations, focusing on accredited investor verification and other legal requirements.
- Strategic Offering Development: Our team assists in crafting a compelling offering that provides the information required by a sophisticated investor pool.
- Marketing and Public Solicitation: We review your marketing strategies for compliance with Rule 506(c)’s unique public solicitation provisions.
- Post-Offering Support: We can provide ongoing support, including help with reporting obligations and maintaining investor relations.
- Customized Approach: We tailor our strategies to fit your business’s specific needs and fundraising objectives.
- Comprehensive Support: From initial planning to final compliance, we offer end-to-end support throughout the offering process.
- Innovative Legal Solutions: Staying ahead of legal trends, we provide innovative and effective strategies to maximize your fundraising success.
Launch Your Rule 506(c) Offering with Confidence
FundWise is prepared to guide you through the complexities of a Rule 506(c) offering. Whether you are a seasoned issuer or new to capital raising, our team is equipped to provide the expert guidance and support you need.
Engage with FundWise Today
- Schedule a Consultation: Learn how a Rule 506(c) offering can benefit your business. Click here to schedule a call for a personalized consultation.
- In-Depth Insights: Explore our resources on Rule 506(c) and understand how it can be a game-changer for your capital raising strategy.
- Stay Updated: Join our newsletter to receive the latest in securities law and insights into successful capital raising practices.
Partner with FundWise to unlock the full potential of your Rule 506(c) offering, where expertise meets innovation in capital raising.
Frequently asked questions
What is Rule 506(c)?
Rule 506(c) is a provision under Regulation D of the Securities Act of 1933 that permits issuers to broadly solicit and generally advertise an offering, provided that all purchasers in the offering are accredited investors and the issuer takes reasonable steps to verify their accredited status.
Who can invest in a Rule 506(c) offering?
Only accredited investors, as defined by the SEC, can invest in a Rule 506(c) offering. This includes individuals with a net worth exceeding $1 million (excluding the value of their primary residence) or an annual income exceeding $200,000 ($300,000 for joint income) for the last two years.
How does Rule 506(c) differ from Rule 506(b)?
The main difference is that Rule 506(c) allows for general solicitation and advertising of the offering, whereas Rule 506(b) does not. However, 506(b) allows for up to 35 non-accredited, sophisticated investors to participate, which 506(c) does not.
Is there a limit on the amount that can be raised under Rule 506(c)?
No, there is no cap on the amount of money that can be raised under Rule 506(c).
How does Rule 506(c) affect state securities laws?
While Rule 506(c) offerings are exempt from state registration requirements, states still have the authority to require notice filings and collect state fees.
an Rule 506(c) offerings be advertised publicly?
Yes, one of the key features of Rule 506(c) is that it allows issuers to use general solicitation and advertising to market their securities, which is not permitted under other Regulation D exemptions.
Are there any ongoing reporting requirements?
Unlike public companies, there are no ongoing reporting requirements with the SEC specifically for the offering. However, issuers must comply with any applicable federal securities laws and state notice filing requirements.
What are the requirements for verifying accredited investor status under Rule 506(c)?
Issuers must take reasonable steps to verify that all investors are accredited. This can include reviewing tax returns, W-2s, bank statements, credit reports, or other financial documents that demonstrate an investor’s income or net worth. Alternatively, reliance on a third party, like a broker-dealer, attorney, or CPA, who confirms the investor’s accredited status can also be considered reasonable.