Raising Capital with Regulation D

How Capital Raising Works Under Regulation D

A Guide to Private Offerings and Global Investment Access

An Introduction - Raising Capital with Regulation D

Raising capital is a crucial step for startups and growing companies. For many businesses, accessing traditional funding sources like bank loans or public offerings can be difficult, costly, or impractical. Regulation D (Reg D) of the U.S. Securities and Exchange Commission (SEC) offers an alternative: a streamlined way to raise capital through private offerings without the burdens of a full public registration.

Why Use Regulation D?

Regulation D includes several exemptions, but the most commonly used are Rule 504, Rule 506(b), and Rule 506(c):

• Rule 504 allows companies to raise up to $10 million within a 12-month period. It’s often used by small businesses and allows some flexibility in soliciting investors, depending on state laws.
  
  

• Rule 506(b) permits a company to raise an unlimited amount of money from up to 35 non-accredited investors and an unlimited number of accredited investors. However, general solicitation or advertising is not allowed. Companies must have a pre-existing relationship with potential investors and provide detailed disclosure to non-accredited participants.
  
  

• Rule 506(c) also allows unlimited fundraising but only from accredited investors. This rule does permit general solicitation and advertising, as long as the issuer takes reasonable steps to verify the accredited status of each investor.

Who Can Invest?

A key concept in Regulation D is the definition of an "accredited investor." These are individuals or entities that meet certain income, net worth, or professional criteria, such as having an annual income over $200,000 (or $300,000 with a spouse) or a net worth over $1 million excluding their primary residence. The idea is that accredited investors are financially sophisticated and can bear the risk of private investments.

Key Rules Under Regulation D

Regulation D is a set of rules under the Securities Act of 1933 that allows companies to sell securities without registering them with the SEC, as long as they meet certain requirements. These rules provide "safe harbors" for companies to raise funds while remaining compliant with federal securities laws. Reg D is especially popular among startups, real estate ventures, and small businesses seeking early-stage or growth capital.

What is Regulation D?

The main advantage of Reg D offerings is that they reduce the time and cost associated with raising capital. Companies can avoid the lengthy SEC registration process, maintain greater privacy, and retain more control over their business. Additionally, Reg D provides access to a large pool of private capital, especially from angel investors, venture capital firms, and family offices.

🎯Regulation D (Reg D) offerings provide a streamlined path for companies to raise capital from accredited investors without SEC registration, reducing time and cost while maintaining privacy and control—ideal for startups and growth-stage businesses.

An affordable, service-driven approach to raising capital—designed to guide project owners every step of the way.

Preparing & Reviewing Investor Documents

Preparing investor-ready documentation

Engage with investors who understand your space

Identifying Investors via Global Network

Targeted Premium Investor Connections

Create Offering Materials – Pitch deck, PPM

Preparing & Reviewing Investor Documents

At Jade Corporate Advisors, we guide businesses through every stage of a Reg D capital raise—from structuring the offering to investor outreach. Our services include:

Preparing investor-ready documentation (pitch deck, financial model, executive summary)

Ensuring legal and compliance alignment through partnerships with securities attorneys

Accessing our curated network of accredited investors, VCs, and family offices

Facilitating introductions and managing investor communications

With our strategic advisory and investor network, you can raise capital faster, with greater confidence and control.

2 Identifying Investors via Global Network

Is Regulation D Right for Your Business?

If you're a startup or growth-stage company looking to raise private capital without the burden of full SEC registration, a Reg D offering might be the ideal path. With the right support, you can:

• Gain access to capital quickly

• Maintain ownership and control

• Engage with investors who understand your space

Jade Corporate Advisors can help assess your readiness, prepare the necessary documents, and connect you with serious investors.

3 Targeted Premium Investor Connections

Action Steps to Launch a Reg D Offering

1. Assess Business Readiness – Review financials, growth plan, and capital requirements

2. Create Offering Materials – Pitch deck, PPM (Private Placement Memorandum), financial model

3. Identify Target Investors – Use CRM to match with angel investors, VCs, and family offices

4. Launch Investor Outreach – Leverage email campaigns, investor webinars, and curated meetings

5. Manage Follow-ups & Due Diligence – Virtual CFO support and investor engagement

The project owner is solely responsible for engaging and coordinating with legal counsel to ensure compliance with SEC regulations.

Important Considerations

Although Reg D simplifies securities offerings, it does not eliminate the need for compliance. Issuers must still file Form D with the SEC after the first sale of securities and must follow anti-fraud provisions. They also need to consider state “blue sky” laws and investor protections.

1. Tech Startups
A SaaS company developing AI-based productivity tools wants to scale quickly but avoid going public too early. Using Rule 506(b), the founders raise $8 million from angel investors and venture capitalists. They avoid general solicitation but can include a few sophisticated non-accredited investors by providing detailed disclosures.

2. Real Estate Development
A developer plans a $50 million commercial real estate project. Under Rule 506(c), they launch a public marketing campaign to attract accredited investors via online platforms. They verify investor credentials before accepting capital, streamlining the raise while staying compliant.

3. Crypto & Blockchain Projects
A blockchain startup wants to fund development of a decentralized finance (DeFi) platform. To avoid SEC scrutiny faced by earlier ICOs, it raises capital through Rule 506(c), targeting accredited investors and providing full transparency, legal documentation, and investor verification.

4. Payment Management Companies
A B2B payment processing firm raising Series A funds uses Rule 506(b) to quietly approach venture capital firms and strategic investors. By maintaining confidentiality and bypassing public marketing, the company preserves sensitive business data and negotiates better terms.

Case Studies - Real- World Examples Across Industries

Additional Advantages of Using Reg D

Beyond just simplifying the capital-raising process, Reg D offers several other benefits:

Speed to Market: Companies can access capital faster without waiting for SEC review.

Cost Efficiency: No need for expensive public filings or underwriting costs.
Investor Flexibility: Allows both institutional and (under Rule 506(b)) select non-accredited investors.
Confidentiality: Unlike public offerings, private placements can remain relatively low-profile, protecting business strategy and financial details.
Unlimited Capital (Rule 506): No cap on the amount of money raised under Rule 506(b) or (c).
Reuse for Multiple Rounds: Reg D offerings can be used across different funding rounds, making it a repeatable process.
National Preemption (Rule 506): These offerings are exempt from most state-level registration requirements, simplifying multistate fundraising efforts.

Final Thoughts

Reg D has become a go-to fundraising tool for modern businesses across industries. Whether you're a tech founder launching a startup, a developer building multifamily units, a crypto innovator, or a fintech disruptor, Reg D offers a practical and flexible way to raise capital while staying compliant. Knowing the right rule to use—and the type of investors to target—can make the difference between a stalled vision and a fully funded future.

Read More Explore how investors from the UK, EU, UAE, Saudi Arabia, Qatar, and India can legally participate in U.S. Regulation D offerings. Learn about key regulations, eligibility, and cross-border investment considerations.

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