OurCrowd’s platform is currently set up to accept members with accreditation status in their country of residence. What are the criteria, and which actions are required on your part? We have the answers for you below.
Why must I be accredited?
Early stage, privately-held companies are high-risk investments, and therefore many countries require individuals to meet certain financial criteria before being allowed to participate in these investments.
What are the overall criteria of accreditation?
OurCrowd follows the rules of your country of residence – the one in which you pay taxes. These vary country-by-country, but all address the following two questions:
- What are the criteria for the minimum level of income and/or net worth of investors who are allowed to participate in these types of investments?
- What proof do investors have to give in order to satisfy their government that they meet these criteria?
Accreditation by country:
Criteria of accreditation for U.S. investors only:
In the United States, to be an accredited investor, one must have:
- An annual income of $200,000 ($300,000 if filing joint) for the last two years with an expectation that their income level will continue
- Or a net worth, not including primary residence, of $1,000,000 in order to invest in early stage companies.
Paperwork for U.S. investors:
U.S. investors self-certify that they meet the above criteria when joining OurCrowd. This grants them full access to OurCrowd's site. However, making an investment requires additional verification of a U.S. investor's accredited status. Upon an investor's first commitment to invest in a company, OurCrowd will provide a checklist and letter for the investor to have signed by one of the following professionals to verify their accredited status:
- A registered broker-dealer
- A registered investment adviser
- A licensed attorney in good standing, or
- A registered CPA in good standing
Please note that this not an OurCrowd-only requirement. Every company that offers these types of investments must have a letter on file from each investor who makes an investment after September 23, 2013.
The letter is valid for a year. In order to make further investments, you must get another letter from one of the professionals listed above to certify that you still meet the U.S. Government requirements. This third-party verification is due to regulatory changes that came into effect September 23rd, 2013.
Criteria for countries other than the U.S.:
If your primary residence for tax purposes is outside the U.S., your country determines the minimum income or asset requirement that allows you to participate in OurCrowd investments. The sign up process for OurCrowd is country-specific: investors check off the requirements that they satisfy and specify, when necessary, the reason that they meet each requirement.
Paperwork for non-U.S. investors:
All countries other than the US allow self-certification. When OurCrowd sends documents to investors once they have indicated that they want to invest in a particular company, the documents include a self-certification of the requirements appropriate for the investor’s residence country. When investors sign the self-certification, their government accepts their declaration that they satisfy the criteria of an investor able to tolerate the level of risk that the investment represents.
For more information:
If you have any questions about the accreditation process, don't hesitate to contact us for guidance.