Private Capital Insight / Regulation D
Rule 506(b) vs. Rule 506(c): Which Regulation D Structure Fits Your Private Raise?
For many private offerings, the practical choice is not simply whether to rely on Regulation D. It is whether the investor-acquisition strategy fits Rule 506(b) or Rule 506(c).
The difference affects whether the offering can be publicly promoted, who may ultimately purchase the securities and how accredited-investor status is handled.
At a glance
The practical differences
The table is a starting point for structuring the conversation—not a substitute for transaction-specific analysis.
CONSIDERATION
RULE 506(B)
RULE 506(C)
General solicitation
Generally prohibited
Permitted
Accredited purchasers
Permitted
Required for all purchasers
Non-accredited purchasers
Limited circumstances
Not permitted
Accredited verification
Reasonable belief framework
Reasonable verification steps required
Public LinkedIn promotion of a specific offering
Generally incompatible
Potentially permissible if requirements satisfied
Choose deliberately
Not sure which structure fits?
A considered first step
START WITH THE RIGHT ASSESSMENT
Before legal work begins, identify the transaction, urgency, complexity, decision authority, and principal readiness issues.
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