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Comment by Aeolun | Hacker News Reader

What the hell. You need to have assets exceeding 1M to invest $1000?

I don’t need that to buy any other stock, why would I need it here?

Hell, how does it even apply to people not living in the US in the first place.

Those other stocks are the result of a multi-year process of disclosure and regulation with the SEC, including quarterly audited financial disclosures, due diligence reviews, and a gigantic mess of filings. Companies pay tens of millions of dollars to get themselves into a position where ordinary retail investors can buy their stock.

These people, on the other hand, are just a bunch of people with a web page. You can solicit investments on a web page, but only from sophisticated buyers, who the law assumes should know better than to invest.

> You can solicit investments on a web page, but only from sophisticated buyers

Unless you are selling cryptocurrency or a variety of non-materialized products (crowdfunding).

It seems eminently more reasonable to me to be able to invest in an existing company with an actual product.

There is a huge difference between speculatively giving money to a company that may or may not provide you with a product and a company promising investment returns. The amount you'll give to the product company is capped by some plausible valuation you give the product itself, which is virtually always very low relative to your net worth. The same isn't at all true of an investment opportunity; people can and do lose their life's savings chasing sketchy investment returns.

If your point is that cryptocurrency speculation should be heavily regulated and even restricted to accredited investors, you won't get any disagreement from me!

>I don’t need that to buy any other stock, why would I need it here?

Those have much stricter legal and regulatory oversights which would be financially infeasible for a smaller entity to deal with. The law is to prevent people from losing all their limited life savings in scams.

>Hell, how does it even apply to people not living in the US in the first place.

Because it's a US company governed by US laws around hosting an investment vehicle. Feel free to invest in a company in a different country if you wish to be governed by different laws.

> Because it's a US company governed by US laws around hosting an investment vehicle.

Yeah, I understand that. It was mostly a thought experiment. Say I invest in this company, sitting in my house in Japan. What are they going to do? Extradite me to the US because I gave some US company money in an unapproved way?

I'm not a lawyer and this is random guesses. If the SEC goes after the company due to this then you may be liable for civil penalties as you lied on a contract. This could mean that any of your other US investments could be taken if you lose the case. It may also make the initial contract around the investment void in which case you may lose out on any increase in valuation. I suspect the SEC would be much in favor of the last one happening to discourage such actions in the future.

Because they need you to sit back and go "damn what a bummer" when your investment nets you a $1000 loss, instead of it being something that would want you to sue.

That happens to me all the time in the stock market and I don't have close to 1MM

You take 100% losses "all the time"? That's the risk being discussed, not taking a $1000 loss on a $50,000 investment.

Is that attitude limited to millionaires? I know a lot of people who have $1000 to invest who are nowhere near having a million dollars in assets.

No this is not arbitrary, accredited investors have a specific set of requirements they need to meet in the US: https://www.investopedia.com/terms/a/accreditedinvestor.asp

Multi decade angel investor here: accredited investor requirements are completely normal, including the good faith clause.

So I don't make a billion bucks a year, but I'd be completely comfortable throwing a few grand at Purism.

If I check the "yeah I'm cool" box even though the SEC wouldn't think I'm cool, am I just forfeiting some sort of recourse if Purism flops and I lose my money? Or am I opening myself up to getting in serious trouble?

(Likewise, I want to invest in Aptera but I don't know anything about this. I feel like the main thing it'll accomplish is making my taxes more complicated, which at my level is a huge step in complexity and cost for a minuscule step in returns.)

I'm not sure HN is an appropriate place to ask for advice on committing crimes.

It hardly seems a crime to give a company money, regardless of whether you get anything in return.

if you have zero people that admitted to being unaccredited investors, then you don't have to verify accredited status and can rely on "self-certification"

this is the legal term for the good kind of lying

but if you want the badge that says "I'm actually an accredited investor!" there are knowledge tests you can take again instead of purely wealth or income tests

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