People on HN are pretty smart, but it's not representative of the entire population.
People get scammed by ridiculously obvious scams. Do you really think they have the ability to invest in a start-up in an intelligent way?
It's an archaic set of rules, from a dumber era, and totally out-of-sync with what people are capable of, and what real risks to "all of their wealth" exist today.
You can lose all your money doing real-estate deals or buying stocks, but those are regulated financial activities. Basically the gov't is saying "I don't want just anyone buying a private company, but I'm OK with allowing them to purchase equity in a public company because those companies are forced to be transparent."
Note: I'm not defending the law, just trying to explain the rationale for it.
It can't be because the rule provides strong protection of non-millionaire savings, because there are already endless ways for the gullible to lose all their money. It can't be millionaires are especially immune to common scams, because there's no evidence of that – and in fact quite a lot of evidence to the contrary.
Why not make these government policies wealth-oblivious, the same way they're race-, gender-, or religion- oblivious?
Why not base any necessary protections on objective tests of knowledge and ability, as with driver or occupational licensing?
Basically, it'd open up individuals to being scammed a lot more and the non-scams would still not be open to them.
Because they're profitable to the state. There have historically been blanket bans on both of these things at all wealth levels in the US. I still know of no private lotteries.
Both exist to exploit people who don't understand probability, and are essentially voluntary regressive taxes. When it comes to these two, now is the dumber era.
Beside which, capital gains tax probably earns more for the state than either lottery or gambling income in many states.
Perhaps limit the amount that can be invested without accreditation?
Con: might lead to a system where some scammers are skimming small amounts from large numbers of people, but not causing enough pain to do something about it.
However in reality, some people do need protecting and the easiest way to do it is to "protect" everyone.
Why is the most important piece of information Kickstarter shares with you the amount already pledged? You can see this in their page layout and in their various widgets.