When we were raising our angel round we asked our lawyers about this.

In the US, the general legal advice is that unless it's friends and family, it is not a good idea to raise money for equity from people who are not Accredited Investors. (http://en.wikipedia.org/wiki/Accredited_investor -- in short, millionaires).

IANAL, but the reason they gave is that non-Accredited Investors have more protections from the SEC and they can sue you if they decide that you didn't spend their money wisely.

There are also some complications that arise when you have too many investors on your cap table. I've heard of people getting around this by creating an LLP that invests in your company with set terms, rather than directly investing in your company. But I can't say for sure if this is good advice.