[diego]

Most people who work in Silicon Valley for a while can afford to make a few small investments like that if they choose. Others buy a nice car, or whatever. It can be seen as an expensive hobby. Many angel investors are regular working guys/gals.

[ashray]

I'm curious as to how you make such investments though. I thought the rules were that you either need to have net worth > $5MM or a household income of over $300k/year. Those are from the SEC website and I'm not 100% sure of whether they apply to everyone or just on second market. (I guess contract investments work otherwise..)

If those numbers are right then that still does sound out of reach. Though to be honest, $100k per investment also sounds out of reach to me but I haven't had any big silicon valley payouts.

[shashashasha]

The > $5M is for entities, there's also "a natural person who has individual net worth... that exceeds $1 million"

and

"a natural person with income exceeding $200,000 in each of the two most recent years"

http://www.sec.gov/answers/accred.htm

[diego]

You can also invest in startups as an unaccredited investor, with some restrictions. I know those laws have been revised recently.

http://www.quora.com/Investing/What-are-unaccredited-investo...