Once primarily reserved for institutions, alternatives are becoming increasingly accessible thanks to lower minimum funding requirements and platforms like CrowdStreet.[1] Still, understanding what accreditation entails — and how to qualify — is essential for investors looking to potentially expand their portfolios.
Here are a few ways to qualify as an accredited individual investor and why it’s key to accessing these opportunities.
The Securities and Exchange Commission (SEC) has set forth several regulations which determine who can invest in certain types of securities. In 1982, it created the category of “accredited investors”: those with the financial means and sophistication to evaluate investment opportunities outside of the public markets.[2]
These investments — like early-stage companies or privately negotiated loans — usually come with higher risks and less liquidity.[3] The SEC thresholds are meant to protect investors by limiting access to those who can reasonably evaluate and absorb those risks.
To qualify as an accredited individual investor on platforms like CrowdStreet, there are typically two options: financial criteria or professional criteria.
To qualify under financial criteria, you must meet one of the following:[4]
To qualify under professional criteria, holding a Series 7, Series 65, or Series 82 license in good standing grants accreditation, once confirmed.
To verify your accreditation, in many cases, you’ll typically work directly with the fund, advisor, or platform you’re investing with. At CrowdStreet, for example, this involves submitting financial documents, such as income or bank statements, to confirm you meet the requirements. Alternatively, you may provide a letter from a licensed CPA, attorney, or registered wealth advisor attesting to your status.[5]
For a full list of accreditation requirements, visit the SEC’s website.
Why can’t everyone invest in alternatives, regardless of their financial or professional qualifications?
In many cases, alternative investment vehicles don’t have to register with the SEC. They operate with a higher degree of risk, fewer disclosure requirements, and can involve complex legal and investment structures.[6] This added complexity means they require a more informed approach, which is why the SEC enforces strict qualifications.[7]
Liquidity is another factor. Many alternative assets have limited trading activity, so you can’t just buy or sell them on demand. Some investments can tie up your capital for years, making them unsuitable for anyone who needs quick access to their funds.[8]
Accreditation rules are there to protect investors, not create exclusivity. Still, even those who meet the financial thresholds have historically struggled to access these opportunities.[9]
That’s why CrowdStreet is dedicated to expanding access to alternative investments for individual investors — including in new categories, beyond CRE, that the company may explore in 2025.