June 2, 2014
I understand you are considering raising the asset and income requirements for accredited investors. I would encourage you to keep them as they have been.
The change in the last few years to exclude occupied real estate made sense. But, raising the levels further seems unnecessary to me.
The current standards set a test which seems very much in line with typical practices of angel investors in my community. Startup investments in technology companies in Oregon in or the local angel funds are often in the $25,000 range. This amount of funding provides a potentially attractive investment and is very meaningful to companies just getting started. I worry that the earliest stage startups would suffer unduly room the change, and places like Oregon, which now has a vibrant startup scene, will suffer disproportionately to other areas like Silicon Valley where there are many more truly wealthy investors. I don't want to see talent migrate away.
I am an active participant in a local fund, the Oregon Angel Fund, which has proven that by working together, smaller angel investors can produce solid returns and help build the local economy. Raising the thresholds for accredited investors would surely hurt our ability to assemble our fund and exclude very talented people who help us evaluate and guide our portfolio companies.
Thanks for your consideration,
Drew Smith