The Securities and Exchange Commission (SEC) has issued new guidance that eases the process of general solicitation for private equity and venture capital firms. This change aims to reduce complexity and costs associated with investor verification.
In 2012, the Obama administration introduced the JOBS Act, which aimed to promote crowdfunding through general solicitation. However, the SEC’s initial guidelines created a lengthy and expensive process due to strict accreditation requirements. Firms worried that investors would be deterred by intrusive questioning, leading to a perception of desperation.
SEC Commissioner Hester Peirce has long advocated for the use of 506(c) offerings, which allow general solicitation. Latham & Watkins law firm, in collaboration with SEC officials, reached an agreement that acknowledged a minimum investment commitment as sufficient verification for accredited investor status.
As a result, private equity firms now have more flexibility to use 506(c) for fund offerings or transition existing efforts from traditional 506(b) processes. This change enables them to publicly discuss their offerings with reporters and potentially advertise them. However, firms raising capital from international investors must comply with foreign securities rules.
In other news, NASA astronauts Barry “Butch” Wilmore and Sunita “Suni” Williams have undocked from the International Space Station after spending over 280 days in space. The pair will begin their long-awaited return journey after a brief stay on the ISS as part of the Boeing Starliner’s first crewed test flight.
Additionally, there was an apparent standoff at the US Institute of Peace headquarters in Washington D.C. involving DOGE’s staff and acting president Kenneth Jackson, who was escorted by police. Rep. Don Beyer (D-Va.) reportedly conducted congressional oversight over the incident.
Source: https://www.axios.com/2025/03/17/sec-general-solicitation-private-equity