Rule 506(b) vs. 506(c): A Practical Guide for Startup Founders
Rule 506(b) and 506(c) are the two Reg D exemptions that power almost all startup fundraising. Here's how they differ, when to use each, and the mistakes that get founders into trouble.
Rule 506(b) and 506(c) are the two Reg D exemptions that power almost all startup fundraising. Here's how they differ, when to use each, and the mistakes that get founders into trouble.
Accredited investor requirements for startups: income test $200k/$300k, net worth $1M (excluding your home), and SEC-approved credentials. Includes verification steps under Reg D (506(b)/(c)).
A practical comparison of the two most important Reg D exemptions — Rule 506(b) and 506(c). When to use each, how investor verification works, and how to avoid costly mistakes.
A comprehensive guide to Regulation D — the securities law framework that makes startup fundraising possible. Covers Rules 504, 506(b), and 506(c), accredited investor requirements, Form D, and common pitfalls.
If you are a non-public company granting stock options or other compensatory equity awards, you need to be familiar with Rule 701 Math and in particular its mathematical limitations.