Each topic below is written to stand on its own as a useful reference. We cite primary sources from the U.S. Securities and Exchange Commission (SEC) and federal regulations wherever a specific rule or threshold is involved, so you can verify the information independently.
This is educational material only — not legal, tax, or investment advice. See the disclaimer at the bottom of every page.
Topics
Regulation A
The "mini-IPO" exemption. Tier 1 vs. Tier 2, investor limits, reporting requirements, and how Reg A made private offerings available to non-accredited retail investors.
Revenue-Based Financing (RBF)
How revenue-sharing agreements compare to venture capital and bank loans. Return caps, revenue share percentages, and the platforms that pioneered modern RBF.
Securities & Investment Types
What a security is under the Howey Test. Equity, debt, hybrid instruments, convertible notes, SAFEs, and revenue participation agreements.
SEC Exemptions Overview
Regulation D (506(b), 506(c)), Regulation Crowdfunding, Regulation S, and Rule 144. Who can invest under each, and what companies must disclose.
Alternative Trading Systems (ATS)
How ATS platforms differ from national exchanges, SEC Regulation ATS, and how secondary market pricing works for non-standardized instruments.
Investor Protection & Disclosures
How to read an offering circular, risk factors to look for, concentration risk, and evaluating a company's financial health as a retail investor.
Frequently asked questions
Not necessarily. Several SEC exemptions allow non-accredited retail investors to participate, including Regulation A (both Tier 1 and Tier 2), Regulation Crowdfunding (Reg CF), and some Regulation D 506(b) offerings (though 506(b) limits you to 35 non-accredited investors per deal). Each framework has different disclosure requirements and investment caps. Regulation D 506(c) offerings, by contrast, are restricted to accredited investors only.
The accredited investor standard is generally: $1 million net worth excluding your primary residence, or $200,000 individual income ($300,000 joint) for the past two years with a reasonable expectation of the same going forward. See 17 CFR 230.501 for the full definition.
Source: SEC — Accredited Investor; 17 CFR 230.501.
Regulation A has two tiers. Tier 1 permits issuers to raise up to $20 million in a 12-month period but requires state-level "Blue Sky" review in every state where securities are offered. Tier 2 permits up to $75 million in a 12-month period and preempts state Blue Sky review in exchange for audited financial statements, annual and semiannual reports, and investment caps for non-accredited investors (generally capped at 10% of the greater of annual income or net worth, per offering).
Source: SEC — Regulation A; 17 CFR 230.251–230.263. See the full Regulation A page for more.
A Revenue Participation Agreement (RPA) is a contract under which an investor provides capital to a company in exchange for a fixed percentage of the company's revenue — paid out periodically — until a predetermined return cap (for example, 1.3x the amount invested) is reached. Unlike equity, the investor does not receive ownership in the company. Unlike a traditional loan, payments scale with revenue and are not fixed.
Revenue participation is part of a broader category known as revenue-based financing (RBF) or revenue-linked credit. See the full RBF page for a detailed breakdown.
Historically, no — private market investments have been largely illiquid, often locking capital for 5–10 years. This is changing. Securities registered with the SEC or qualified under Regulation A Tier 2 are generally freely transferable after a holding period, and secondary trading can occur on Alternative Trading Systems (ATS) — SEC-registered venues that match buyers and sellers of securities outside the national exchanges. Liquidity depends on the specific security, the venue, and the market's depth for that asset.
Source: 17 CFR 240.3a1-1; SEC — Regulation ATS.