How Do I Raise From Accredited Investors I Don't Know? Rule 506(c), Start to Finish

Use Rule 506(c). It is the exemption that lets you advertise a private raise publicly, on your website, LinkedIn, email, podcasts, events and paid ads, as long as every investor who buys is accredited and you take reasonable steps to verify it. There is no limit on how much you can raise. The work comes in a set order: size the raise and set a valuation you can defend, prepare the deck, executive summary, documents and data room, set up verification, then market to a defined audience and move each prospect from first contact to a signed, verified subscription. File a Form D within 15 days of the first sale, plus state notices.

By Joel Arberman, founder of Prepared to Raise · 17 companies taken public, 30+ private placements prepared · Reviewed October 21, 2026

When 506(c) is the right tool

Your network has given what it can, or was never big enough for the amount you need. You need investors who don't know you yet, and you need to be able to tell them about the opportunity in public. Rule 506(b) forbids that. Rule 506(c) allows it, with one firm condition: every purchaser must be an accredited investor, and you must take reasonable steps to verify it. 506(b) vs 506(c) compared.

Step 1: Strategy

  • The amount, sized to a specific milestone, with a minimum that lets the company proceed.
  • The valuation, one you can explain in a sentence with comparables behind it.
  • The security, common, preferred, a note or units, and the terms.
  • The investor's exit: how they get their money back. Strangers ask this sooner than friends do. Returns when you'll never sell.

Step 2: Materials

  • Investor deck and two-page executive summary
  • Return scenarios on one page
  • Term sheet, subscription agreement, investor questionnaire and risk factors, reviewed by securities counsel; a full PPM if investors will expect one
  • A data room with financials, cap table, contracts and diligence answers

Investors who don't know you judge you by these documents first. They need to be consistent, specific and professional.

Step 3: Verification

Decide how you will verify accredited status before the first ad runs: an online verification service, letters from investors' CPAs or attorneys, or your own review of tax returns or statements. How verification works and what it costs.

Step 4: Marketing

Define who you are looking for: industry insiders, customers, professionals in a region, people who have invested in similar businesses. Then reach them:

Every public statement must be accurate and balanced. Antifraud rules apply to a LinkedIn post as much as to a PPM.

Step 5: The pipeline

  1. First contact: an ad, a post, a referral
  2. Introductory call or webinar
  3. Data room access and diligence questions
  4. A follow-up meeting with the hard questions answered
  5. Commitment and signed subscription agreement
  6. Verification of accredited status
  7. Funds received and securities issued

Track every prospect in one place. Raises from strangers take more touches than raises from friends, and momentum fades fast without follow-up.

Step 6: Filings

File Form D within 15 days of the first sale, checking 506(c). If you started under 506(b), amend the Form D before you begin public solicitation. File state notices where investors live. Form D and blue-sky notices.

Timeline

About four weeks to prepare when the business fundamentals are in place. The raise itself usually runs for months. Plan for a first close once you reach your minimum, then later closes.

Related questions

Can a non-accredited investor join if they insist?

No. One unverified or non-accredited purchaser can cost you the 506(c) exemption for the whole offering.

Can I mention the raise before everything is ready?

Under 506(c), yes, but premature or loose statements become part of the offering. Have the materials and verification ready first.

Can my existing investors invest again?

Yes, if they are accredited. Investors you verified within the past five years can generally re-certify in writing.

Do I need a broker-dealer?

No. Many 506(c) issuers raise directly. If you use one, they must be registered.

Where to start

Our Growth Capital package ($20,000, raises up to $10 million) covers the strategy, diligence review, materials, lawyer-reviewed documents, data room and mock investor sessions. Advertising publicly adds the 506(c) extension ($5,000). Start with a Readiness Assessment ($1,500, credited within 60 days).

Prepared to Raise is a service of Meraki Partners, LLC. This article is general information, not legal, tax or investment advice, and not an offer to sell or a solicitation to buy any security. Meraki Partners is not a broker-dealer, funding portal, investment adviser or law firm. We do not solicit or introduce investors.