Reg D & Compliance
General Solicitation: What It Is and What It Unlocks for Your Raise
General solicitation is the act of publicly offering or advertising securities to people you have no pre-existing relationship with — running ads about your raise, posting the deal on social media, pitching a room of strangers, or publishing the offering on a website anyone can find. In securities law it's the line between a genuinely private offering and a public campaign, and for a sponsor it's the single rule that decides whether your raise is limited to your rolodex or open to the entire market.
By One Million Media7 min read
This page is the definitional ground truth on the term: where it came from, what counts and what doesn't, the conditions attached when you use it, and why it changed the economics of raising private capital. It's written for the sponsor running the offering — the person whose marketing plan lives or dies on this definition.
The definition, precisely
General solicitation (the rules also say "general advertising") means offering securities through any form of public communication — advertisements, articles, broadcast and online media, websites, mass email, or seminars and meetings whose attendees were invited by public means. The operative idea is the audience, not the channel: if you're promoting an offering to people with whom you have no pre-existing, substantive relationship, you're generally soliciting.
Both halves of that relationship test carry weight. Pre-existing means the relationship was formed before the offering — not three days before the wire. Substantive means you actually know something about the person's financial circumstances and sophistication — a LinkedIn connection or a newsletter signup, by itself, generally isn't enough. The application to any specific fact pattern is exactly the kind of judgment call that belongs with securities counsel, but the shape of the test is consistent: strangers plus a public channel equals general solicitation.
Banned for eighty years, then the JOBS Act
For roughly eighty years after the 1930s securities acts, the deal was simple: private offerings were exempt from registration precisely because they were private. Advertise the offering publicly and it stopped being private — and the exemption died with it. Entire generations of syndicators raised exclusively through personal networks, country-club introductions, and quiet referrals, because that was the only legal surface area available.
The JOBS Act changed that. In 2013, the SEC's implementing rules created Rule 506(c) under Regulation D — the first mainstream exemption that permits general solicitation in a private offering, on conditions we'll cover below. The prohibition didn't disappear; it became a choice. Sponsors who stay under Rule 506(b) still live under the classic ban. Sponsors who elect 506(c) can market in public, legally, for the first time since securities regulation existed in its modern form.
What counts as general solicitation — and what doesn't
The definition gets practical fast, because under 506(b) one public act can put the exemption for the entire raise at risk. Here's how common sponsor activities generally sort — with the caveat that edge cases are fact-specific and worth a counsel call before, not after:
| Activity | Generally solicitation? | Why |
|---|---|---|
| Paid ads naming the offering (Meta, Google, podcasts) | Yes | Public channel, audience of strangers — the textbook case |
| Social posts describing the deal or its terms | Yes | Public communication promoting the offering, regardless of follower count |
| Offering page on a public website | Yes | Anyone can find it; no pre-existing relationship with visitors |
| Mass email to a purchased or scraped list | Yes | Strangers at scale — the medium being email doesn't make it private |
| Pitching the offering at a public event or meetup | Yes | Attendees invited by public means, no substantive relationship |
| Offering shared with investors you know well from prior deals | Generally no | Pre-existing, substantive relationship formed before the offering |
| Brand and education content that never mentions an offering | Generally no | Nothing is being offered — though the line gets fact-specific near a live raise |
| Demo days and certain curated events | It depends | Narrow statutory carve-outs exist with their own conditions — counsel territory |
The test to remember
Two questions sort almost everything: Is a security being offered or promoted? And does the audience include people with whom you have no pre-existing, substantive relationship? Two yeses is general solicitation — whatever the channel is called.
The conditions attached when you use it
General solicitation isn't free. Electing Rule 506(c) — the exemption built around it — attaches conditions that reshape your investor funnel:
- Accredited investors only. Every purchaser must meet the accredited investor definition — commonly $200,000 income ($300,000 jointly) in each of the last two years, or $1 million net worth excluding the primary residence, plus certain licensed professionals and entities. The 35 non-accredited seats that 506(b) allows are gone.
- Reasonable verification. Self-certification doesn't satisfy 506(c). You must take reasonable steps to verify accreditation — typically income documents, asset statements, a letter from the investor's CPA or attorney, or a third-party verification service that commonly runs about $50–$100 per investor.
- Everything else still applies. Form D within 15 days of the first sale, state blue-sky notice filings, bad-actor disqualification checks, and the anti-fraud rules that govern every word of every ad. Solicitation rights are not a license to overpromise.
How those conditions play out operationally — the verification workflow, the channel-by-channel playbook, what you still can't say — is the territory of our 506(c) rule deep-dive. The headline for this page is simpler: the conditions are real, but they're process costs, not caps. There's no limit on offering size and no limit on the number of accredited investors you can reach.
What it means strategically: from rolodex to market
Strip away the legal vocabulary and general solicitation is about one number: the size of your reachable investor pool. Without it, your raise is capped at the people who already know you — and every sponsor who has raised more than once knows how that story goes. The first deal closes on friends, family, and colleagues. The second leans on the same list, harder. By the third, the network is tapped, the deal is bigger, and the calendar fills with coffee meetings that used to be optional and now are the entire capital strategy. The constraint was never the deal. It was the audience.
General solicitation removes that cap. The reachable pool stops being the people you know and becomes the people you can reach — which converts capital raising from a relationship-mining exercise into a marketing discipline, with everything that implies: audiences that compound across raises, content that prospects while you operate, ads with measurable cost per investor lead, webinars that pitch a hundred strangers at once. Sponsors who internalize this stop asking "who do I know with $100k?" and start asking "what does it cost me to acquire an accredited investor?" — a question you can actually engineer against.
The flip side deserves one honest sentence: once solicitation is legal, it's legal for your competitors too. The exemption opens the market; it doesn't win it. The sponsors who benefit most are the ones who treat the unlocked surface area as a system to build, not a press release to issue.
The mistake that makes this definition expensive
The costly failure mode isn't sponsors who choose general solicitation — it's sponsors who commit it by accident. A 506(b) issuer posts a "soft" deal update on LinkedIn, mentions the raise on a podcast, or lets a webinar recording sit on a public page. None of it felt like advertising; all of it can be framed as general solicitation. And because 506(b)'s prohibition applies to the offering as a whole, one public act can jeopardize the exemption for every dollar already raised — with rescission, offering investors their money back, as the ugly remedy on the table.
The practical rule: decide your relationship with this definition before you launch, not during. If your growth plan includes any public marketing of the offering — ads, content, events, press — structure as 506(c) and operate in daylight. If you stay 506(b), treat the prohibition as absolute and route anything borderline past securities counsel first. The worst position in private capital is halfway between the two.
Frequently asked questions
What is general solicitation in simple terms?
Publicly advertising or promoting a securities offering to people you have no pre-existing relationship with — ads, social media posts about the deal, public websites, mass email, or pitching at public events. Strangers plus a public channel is the working test.
Is general solicitation illegal?
No — it's conditional. Under Rule 506(c) of Regulation D, general solicitation is permitted if every investor is accredited and the issuer takes reasonable steps to verify it. Under Rule 506(b), it remains prohibited entirely.
Does posting my offering on social media count as general solicitation?
Generally yes. A public post naming or promoting the offering reaches people you have no pre-existing, substantive relationship with — follower count and how 'soft' the language feels don't change the analysis. Under 506(b), that single post can put the exemption at risk.
What is a pre-existing substantive relationship?
A relationship formed before the offering (pre-existing) in which you actually learned about the person's financial circumstances and sophistication (substantive). A newsletter signup or social-media connection by itself generally isn't enough. Specific fact patterns are a question for securities counsel.
When did general solicitation become legal for private offerings?
In 2013, when SEC rules implementing the JOBS Act took effect and created Rule 506(c) — the first mainstream private-offering exemption to permit public advertising, after roughly eighty years of prohibition. The 506(b) path still bans it.
What happens if a 506(b) offering accidentally generally solicits?
The exemption for the entire offering can be jeopardized — not just the investors who saw the post — and rescission (offering investors their money back) is a possible consequence. If it happens, stop the activity and call securities counsel immediately rather than trying to quietly delete it.
Keep reading
This article is for educational purposes only and is not legal, investment, tax, or securities advice. Securities offerings are regulated; always work with your securities attorney to structure and run your offering. One Million Media is a marketing and lead-generation provider — not a broker-dealer, investment adviser, or law firm.
