Why a business plan is not enough

Many companies rely on a business plan or executive summary to

serve as the basis for their investment. This does not provide the
basis for compliance with state and Federal rules and any capital
raised may be in violation of state or Federal rules.
Regulation D is an exemption that allows companies to raise
capital though the sale of equity or debt securities without
registering with the SEC. Start-ups typically choose the Rule 506(c
program because it allows general advertising and solicitation.
Companies can now execute a “public offering” of their private
placements with straightforward compliance benefits of a
traditional Regulation D offering. The 506(c program allows a
client to execute a public offering of securities while retaining the
benefits of a Regulation D exempt private placement.
The 506(c exemption allows an issuer to engage in general
advertising and solicitation of accredited investors for the
securities offering. It is important to note that the current 506(b
program is still available for issuers that do not need the capability
to engage in general solicitation.
The 506(c program allows a client to execute a public offering of
securities while retaining the benefits of a Regulation D exempt
private placement.