General Solicitation Under Rule 506(c): Marketing Rules for Issuers
Rule 506(c) is the only path within Regulation D that allows an issuer to publicly advertise a securities offering — but "publicly advertise" has a specific meaning, and crossing the line unintentionally under 506(b) is a common compliance mistake.
What counts as general solicitation
General solicitation includes advertisements in newspapers or on websites, unsolicited emails to broad lists, public seminars where attendees were invited through general advertising, and social media posts promoting the offering to the public. The common thread is reaching investors the issuer does not have a pre-existing relationship with, through a broadly available channel.
What 506(c) permits
Once an issuer elects 506(c), all of the above become available: a public website describing the raise, paid marketing campaigns, and open webinars are all permitted, provided every investor who ultimately participates is verified as accredited before the sale closes.
The switching trap
Issuers who start under 506(b) and later want to advertise cannot simply "switch" mid-raise without consequence — prior sales already relying on 506(b)'s non-solicitation posture need to be evaluated separately from new solicitation-driven sales, and counsel should be involved before mixing the two within a single offering.
Practical takeaway
Decide upfront whether your capital-raising strategy depends on public marketing. If it does, build the 506(c) verification workflow into the plan from day one rather than trying to retrofit it later.
This article is provided for general informational and educational purposes only and does not constitute legal, financial, tax, or investment advice. Nothing here is an offer to sell or a solicitation to buy any security. Consult qualified securities counsel before relying on any exemption or filing deadline discussed above.