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Non-Accredited Investor

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Definition of 'Non-Accredited Investor'

An investor who does not meet the net worth requirements for an accredited investor under the Securities & Exchange Commission's  Regulation D. A non-accredited individual investor is one who has a net worth of less than $1 million (including spouse) and who earned less than $200,000 annually ($300,000 with spouse) in the last two years.
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Investopedia explains 'Non-Accredited Investor'

When a company raises private equity for an investment, such as a new company or a hedge fund, it is able to receive unlimited investments from accredited investors. On the other hand, Regulation D stipulates only 35 non-accredited investors are allowed to invest money into a private placement.

Related Definitions

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    Accredited Investor

    A term used by the Securities and Exchange Commission (SEC) under Regulation D to refer to investors who are financially sophisticated and have a reduced need for the protection provided ...
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    • Regulation D - Reg D

      A Securities and Exchange Commission (SEC) regulation governing private placement exemptions. Reg D allows usually smaller companies to raise capital through the sale of equity or debt ...
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      The sale of securities to a relatively small number of select investors as a way of raising capital. Investors involved in private placements are usually large banks, mutual funds, ...
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      The amount by which assets exceed liabilities. This term can be applied to companies and individuals.
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