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SEC Increases Regulation Crowdfunding Max to $5M

Published on Nov 2, 2020 in Crowdfunding News

In a groundbreaking move today, the SEC voted 3-2 to approve an unprecedented increase to the Regulation Crowdfunding maximum—taking the ceiling from $1.07 million to $5 million. These changes come-hand-in-hand with further key amendments, all aimed at modernizing the existing exempt offering framework. Key takeaways from the ruling include: 

  • An increase from $1.07 million to $5 million in the maximum allowable raised. 
  • Exempting accredited investors from investment limits
  • Enabling non-accredited investors to base their investment maximum on the greater of their annual income or net worth.
  • Allowing demonstrative communications to not be deemed as solicitation or advertising.
  • Allowing for “testing of the waters” prior to filing offering documents. 

These changes are slated to propel the Regulation Crowdfunding industry even further forward, enabling businesses to secure much-needed funding amidst pandemic woes and super-charging growth for qualified ventures.  The move should officially take effect within the next 60 days.

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