Some people say “yes,” but honestly, my clients usually don’t start looking for new accredited investors until they have tapped out their group of family and friends who aren’t accredited. You will meet a lot of non-accredited investors at networking events, and you should not discount them. If you do Rule 506(b) offerings, you can include them.
There is a lot of talk on the internet about how having non-accredited investors increases your liability and makes your documents much harder, but in practice, those are non-issues, and it’s the way most of our clients operate.
The best investors are the ones who invest with you. Accredited investors whom you may have met recently are unlikely to invest with you until you have a track record; non-accredited investors seem to be more interested in investing with newer syndicators. So, my advice is meet everyone you can and tell them about your business, whether they are accredited or not. Take time to get to know them and what they want in an investment and then pick your exemption based on the qualifications of your investors.
We get potential clients who reach out to us every week who want to start a fund. While we could simply take their money and set them up with fund offering documents, we actually talk a lot of people out of doing a fund. Why? Because they don’t have the necessary...