Reg CF and 506(c) Side by Side: How the Largest Campaigns Pass $5 Million

Run two offerings at once: a Regulation Crowdfunding offering open to everyone, capped at $5 million in 12 months, and a Rule 506(c) offering for accredited investors, which has no cap and doesn't count toward the Reg CF limit. Both allow public promotion, so the SEC's integration rules generally permit them together, but each offering must meet its own conditions. The 506(c) side needs verified accredited investors and its own documents and Form D; any promotion that mentions the Reg CF terms must follow Reg CF's communication limits; and the information investors receive must be consistent across both. Plan both from the start, rather than steering overflow from one into the other.

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

Why companies do it

  • The $5 million cap. Reg CF stops at $5 million in 12 months. Rule 506(c) has no limit.
  • Different investors. The crowd writes many small checks. Accredited investors write larger ones, and often prefer a private offering without a portal fee.
  • Cost. Portal fees are a percentage of the money raised through the portal. Larger checks through 506(c) avoid that fee on those dollars.
  • Community plus capital. The Reg CF campaign turns customers into owners; the 506(c) side does the heavy lifting on dollars.

How the rules fit together

Since the SEC's 2020 integration framework, companies can run concurrent exempt offerings if each one independently satisfies its own exemption. Both Reg CF and Rule 506(c) permit general solicitation, so promoting one doesn't automatically taint the other. The conditions that matter:

  • 506(c) side: every purchaser accredited and verified, with its own subscription documents and a Form D. Verification.
  • Reg CF side: sales only through the portal, investor limits for non-accredited investors, Form C and its financial statements.
  • Communications: a general solicitation for the 506(c) offering that includes the material terms of the concurrent Reg CF offering has to comply with Reg CF's communication limits. Keep the two sets of messages distinct. Reg CF communication rules.
  • Consistency: the same business, risks and financial information should appear in both offerings. Investors in one shouldn't learn something material that investors in the other didn't.

The FINRA lesson

In May 2022, FINRA fined the funding portal Wefunder $1.4 million. Among the findings: in 39 offerings it helped issuers take in about $20 million more than the Reg CF limit allowed, then moved accredited investors into Rule 506(c) offerings rather than returning the excess. The problem was not running both offerings. It was improvising: letting the crowd campaign overflow and then rerouting money after the fact.

The lesson for founders: design the two offerings before launch, decide which investors go where and how, and never let the Reg CF side accept more than its cap.

How to structure it

  1. Decide the split. For example, up to $5 million through Reg CF and the rest through 506(c), with a minimum check for the 506(c) side.
  2. Use the same security and price in both, or explain any difference clearly. Different terms for similar investors create questions.
  3. One core disclosure package: the business, risks, financials and use of proceeds, adapted into the Form C and the 506(c) documents.
  4. Route accredited investors deliberately. Larger checks are offered the 506(c) documents from the start, with verification. Some portals have an affiliated broker-dealer that can handle a Reg D offering; otherwise the company runs it directly.
  5. Two filings: Form C for Reg CF and Form D for 506(c), plus state notices for the 506(c) side.
  6. One cap table plan, including whether Reg CF investors sit in a crowdfunding vehicle.

Related questions

Does the 506(c) money count toward the $5 million Reg CF cap?

No. The cap applies to amounts sold under Reg CF.

Can an accredited investor invest in the Reg CF offering instead?

Yes. Accredited investors have no Reg CF investment limit, but they pay into the portal-fee side.

Can I add a 506(c) offering after the campaign starts?

You can, but plan it with counsel: the communications, disclosure and investor routing need to be set up properly, not improvised mid-campaign.

Is Reg A+ the better route above $5 million?

Sometimes. Reg A+ allows up to $75 million from anyone, but with SEC review and ongoing reporting. Is Reg A+ right for a company my size?

Read next

Where to start

Network Raise clients can add a Reg CF extension ($15,000) to run a crowd offering alongside their accredited raise. For a larger side-by-side raise, contact us and we'll quote the combination that fits.

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.