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OnMay 16th Title III of the JOBS Act went into effect allowing almost anyone to invest in the equity of a non-public company. The new rules do set some limitations. Investors with an net worth or income below $100,000 can invest either $2,000 or 5% of their annual income or net worth—whichever is lower.
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U.S. law previously prohibited unaccredited investors—those earning less than $200,000 a year with a net worth below $1 million—from investing in private companies in exchange for equity. Such investors could only fund startup projects via platforms such as Kickstarter or Indiegogo in return for a discount or the product itself. But now, just about anyone can spend over $2,000 backing a non-public company in return for equity.
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