The SEC governs the rules for buying and selling securities including when and how securities or offerings must be registered with the SEC and what types of investors can participate in a particular offering. As an online commercial real estate investing marketplace, the vast majority of our investment opportunities are available only to accredited investors. While the terminology can be confusing, it’s important to note that “accredited investor” is a definition, not a process.
The SEC has a set of financial criteria for investors to satisfy the definition of “accredited investor” and access certain types of securities offerings only available to accredited investors. These criteria establish certain thresholds of wealth, verifiable either through salary or personal holdings. These thresholds are intended to protect those who may not possess enough capital, investing experience and/or knowledge and keep them from taking on undue risk in private securities, which are actually less heavily regulated than public equities on the stock market.
These rules and thresholds exist for a reason–they help protect investors.
How Do I Know If I Am An Accredited Investor?
Put simply, you’re an accredited investor if:
You earned more than $200,000 in each of the last two years (or more than $300,000 together with your spouse in each of those years) and reasonably expect the same for this year.
You have a net worth over $1 million, either alone or together with your spouse, excluding the value of your primary residence.
You are a holder in good standing of the Series 7, Series 65, or Series 82 licenses
An accredited investor doesn’t have to be an individual person; trusts, certain retirement accounts, and LLCs may also qualify for accredited investor status. Each investing capacity may have slightly different criteria to be considered accredited, and this flowchart outlines the accreditation standards for all entity types.
If you qualify as an accredited investor, you’ll need to verify your accreditation status in order to be eligible to invest in the commercial real estate offerings on the CrowdStreet Marketplace.
How Do I Verify My Accreditation?
We have made the accreditation verification process as easy as possible by offering several options.
Get a letter signed by your CPA, attorney, or wealth advisor
For certain types of securities offerings, the sponsor may require you to verify your status as an accredited investor by a qualified, independent third party in order to satisfy regulatory requirements. Qualified parties under the applicable regulations include a CPA, attorney, registered investment advisor, or registered broker-dealer. If you already work with one of these parties, ask them to complete and sign this one-page template letter, and then scan and upload it to your documents in the CrowdStreet portal.
Use our online, integrated workflow through VerifyInvestor.com
Alternatively, CrowdStreet investors can prove their accreditation status via our integrated third-party partner, VerifyInvestor. If you use the VerifyInvestor integration through the CrowdStreet platform, we are able to absorb the cost of this service on your behalf. To use VerifyInvestor, follow the link in the Transaction Center, which becomes available after submitting closing documents for a given offer.
VerifyInvestor will ask you to securely upload documentation such as W-2s, tax returns, and/or account balance statements for review by their team of attorneys. Your accreditation verification letter will be automatically imported into your CrowdStreet account, and your supporting documents are retained, either by VerifyInvestor or CrowdStreet. The turnaround time is typically one to two days.
Please note that, per SEC rules, each accreditation verification letter is only valid for 90 days. Should you make multiple investments, you will need to periodically renew your verification.