TLDR:
General solicitation refers to publicly advertising or broadly marketing a securities offering to potential investors, traditionally prohibited in private placements but now allowed under certain conditions in the US (Rule 506(c)).
General Solicitation After JOBS Act
The JOBS Act of 2012 significantly liberalized US securities rules by allowing “general solicitation” — advertising to the general public — for certain private offerings under Rule 506(c) of Regulation D. This change enabled startups to post funding opportunities on AngelList, pitch at public demo days, and promote their fundraise on social media without registering the securities, provided all purchasers are verified accredited investors. Before the JOBS Act, general solicitation was prohibited for private placements, requiring all marketing to happen through pre-existing relationships.
Compliance Requirements Under 506(c)
Regulation A vs. Regulation D Solicitation
Under Rule 506(c) of Regulation D, general solicitation is permitted in private offerings — but only if all purchasers are verified accredited investors (not just self-certified). This higher verification standard creates compliance friction that has limited the popularity of 506(c) despite its solicitation freedom. Regulation A+ permits broader public solicitation of both accredited and non-accredited investors but imposes greater disclosure and ongoing reporting obligations, more akin to a mini-IPO.
Operational Implications
Companies considering general solicitation must implement accredited-investor verification processes — reviewing tax returns, brokerage statements, professional licenses, or relying on third-party verification services (Verify Investor, Parallel Markets, InvestReady). Once solicitation begins, all subsequent investors must satisfy the more rigorous verification standard. Companies also must update their offering materials, marketing materials, and websites to reflect the chosen exemption framework, and document compliance rigorously for SEC examination.