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Who are accredited investors?

Accredited investors include high-net-worth individuals, banks, insurance companies, brokers, and trusts . Accredited investors are defined by the SEC as qualified to invest in complex or sophisticated types of securities that are not closely regulated.

Should a 501(a) accredited investor be perpetual?

It should not be perpetual. On August 26, 2020, the Securities and Exchange Commission (the “SEC”) adopted amendments to the definition of “accredited investor” in Rule 501 (a) of Regulation D under the Securities Act of 1933 (“Securities Act”), which expand the category of investors eligible to participate in private offerings under Regulation D.

What is the role of accredited investors?

For companies raising capital, the accredited investor definition largely determines who is in their pool of potential investors, and for investors whether they are eligible to invest in many early-stage companies.

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