Approximately 95% of our returning syndication clients and all beginning syndicators do 506(b) offerings (that allow up to 35 sophisticated, non-accredited investors and an unlimited number of accredited investors).
Friends, family and acquaintances will invest with you because they know, like and trust you. Strangers you meet via advertising want to know about your track record syndicating similar properties. Note that there are also some state securities exemptions that might allow non-accredited investors if everything is contained in one state (i.e., the syndicator, investors and the property).
Our clients who graduate to 506(c) offerings (advertising allowed, but only verified, accredited investors can invest) do so because: 1) all of the non-accredited investors they know have already invested with them, or 2) they have a sufficient track record to start buying bigger deals (requiring them to raise more money) and they want to use a crowdfunding platform like Crowdstreet to promote their offerings and/or start their own advertising campaign.