Legislation from Congressman Bill Huizenga aims to make it easier for startup businesses to attract investment by revising who may be considered an accredited investor by the SEC for participating in private offerings of securities. He tells us there are many who would support startups who don’t meet the current SEC requirement of having $1 million in assets.
“These are people that didn’t come from a family with means,” Huizenga said. “They didn’t have inherited wealth, they didn’t have any kind of background of prosperity in their families.”
Huizenga says his Accredited Investor Definition Review Act gives the SEC discretion in these cases.
“What we’re trying to do is have the Securities and Exchange Commission examine this, and say, ‘OK, if you can demonstrate a certain education level or a certain understanding financially, you can qualify regardless of your actual income.”
Huizenga says the legislation was prompted by stories from entrepreneurs who had trouble attracting investors. He tells us it passed the House this week on a unanimous vote.
