[vmception]

> Making sure an investor has financial acumen helps founders focus because it is hard enough raising money from angels/VC's in $10k+ amounts - imagine if you only raised $100-$1k per person. Egad! Crowdfunding might be an exception to this - but it is fairly new.

That has zero to do with the existence of accredited investor rules.

In the current reality, many issuers have their own minimum investments such as $25k, $500k, $1mm. This successfully keeps out people that either don't have those sums of money or are encumbered by life expenses, far more than the accredited investor rules do.

An alternate reality without those rules also retains the ability for issuers to deny capital from whoever they want, and by soft-denying capital by setting minimum amounts.

[czbond]

I don't see this as some equity issue people are framing it as.

Issuers have the rules of $25k, $500k, etc bc they really don't want to deal with inexperienced investors (doctors, dentists, etc, etc).... who get fearful when they write a check, are inexperienced and so try to micromanage, and worry incessantly about exits and can be short sighted. Angels are great at hiding all of this, until after the deal closes.

It makes sense to heavily filter people like that out - it would be damn terrible as a founder to have to deal with 300 people who all invested "their life savings of $10k". If you haven't been involved in many private deals, you might not believe that. But most deals are small, rosey-eyed-until-a-loss-might-occur "angels".

[vmception]

I don't care about what the issuers do and I am completely fine with high buyins to filter people out. I want the government out of it completely, but a special purpose accreditation test is fine as I only have issue with the wealth tests and the tests that require a sponsor. (even the series 65 test requires "good standing" as the article mentioned, which is more than just passing the test recently).

People don't need permission to fail financially, they can walk over to any casino and do that. It is merely happenstance that its two different governments regulating casinos (state) versus these particular capital formation rules (federal). But the user experience for the individual doesn't factor that in, and there shouldn't be a discrepancy at all. The argument in favor of "protecting people that actually need their money by deputizing everyone else" is so thin and weak. As we know, these kinds of "deputize everyone else" regulations only exist because a direct prohibition from the state to the individual would undermine at least one of the individual's constitutional rights.