Subject: File No. S7-25-06
From: Jeremy Dilbeck
Affiliation: President, HyperAlert, Inc.

January 30, 2007

I oppose increasing the minimum limits required to be defined as an accredited investor.

Small start-ups, like the company I founded five years ago, often rely on "angel" investors, aka accredited investors, to begin operations. Dropping that pool of investors from 8.8% of the population to 1.3% of the population will have a profound negative impact on new start-up businesses, particularly in the technology sector.

Given the run up in real estate prices, I think it is reasonable to exclude the primary residence in calculating accredited status. I would submit that $1M of investable assets demonstrates sufficient sophistication to make a reasonable evaluation of a business' prospects and to conduct due diligence.

Perhaps the Commission should instead limit the percentage of an accredited investor's assets that can be held in private offerings: 20% if the investor has $1M in liquid assets, 30% if $2M or above, 50% for everyone above $5M.

The Commission while examining this change should also provide a process for people to demonstrate sophistication in a way other than based on assets. For example, those with financial training and entrepreneurial experience in multiple start-ups are very sophisticated about whether to invest in a particular company. The Commission should create some form of test or exemption process by which individuals could demonstrate sophistication and become accredited investors, if not in general, then on a particular private transaction.