1. permitting natural persons who have "professional certifications" or "credentials issued by an accredited educational institution".
2. include as accredited investors, with respect to investments in a private fund, natural persons who are “knowledgeable employees” of the fund.
Most of the other changes fill in gaps that shouldn't have existed: expanding the definition of spouse and adding orgs with >$5MM assets (including tribes, family offices, etc.). YC relevant: "demo days" will not constitute a general solicitation.
Overall a welcome change. I assume that they'll use an existing set of professional certifications in finance, which tend to require non-trivial self-study, so it'll probably also create a market for short educational programs offered by accredited institutions.
Some of the earlier proposals and discussions from public discourse included comments referring to credentials such as CPA, CFA, CMA, being a registered representative, MBA, CIMA, or possibly having been a broker, lawyer or accountant.[1][2]
But ultimately we'll need to wait for the final list.
The SEC's phrasing is somewhat misleading. The amendments give them the right to designate some kinds of educational credentials as sufficient, but they haven't actually done so; the only credentials designated right now are a handful of securities licenses.
It's been discussed, so it's definitely thinkable.
And if getting an accredited-institution MBA, for tuition payments of anywhere from $22K to $200K, after about 17 years of other education (K-12, undergrad) isn't enough for someone to protect their own wealth from scams, what's the point of all that credentialing, anyway?
An MBA is not a licensure. There are overlaps between what an MBA and an accountant may have studied, but the CPA is what gives you a license. Lots of MBA students do not pursue financial courses beyond what is requires to pass. They may have interests in marketing, innovation, or other areas. They can be ill-equipped to deal with investments.
The same pattern exists for law and many other professions. There are plenty of people with law degrees who fail, or decide to not pursue the bar exam.
Given the state of student loans in the US I think there could be a fairly compelling argument that an MBA is indicative of a person’s inability to protect their wealth. Not all MBAs are created equal. Most of them aren’t worth the price and the few that are worth it have a lot more to do with the network and connections than the education.
Executive MBAs are accredited, yes. And, although parent exaggerates a bit, their admissions standards are pretty close to "can you pay".
IMO: A real MBA with an emphasis on finance probably should count as sufficient education. An executive MBA definitely should not. Although a program with the same structure as an executive MBA but exclusively focused on finance, accounting, and contracts might be reasonable.
Of course, it happens any time you create magic status differentiators.
As just one example, stories pop up every few years about sheriff's offices selling 'honorary deputy' or similar status to rich people. I guess sometimes people buy them as symbols, but more frequently for the concealed-carry rights.
What's the definition of a "knowledgeable employee" of a fund? E.g. would any GP be assumed to qualify as long as the fund wasn't specifically created as a vehicle for them to qualify, or are there specific requirements?
1. permitting natural persons who have "professional certifications" or "credentials issued by an accredited educational institution".
2. include as accredited investors, with respect to investments in a private fund, natural persons who are “knowledgeable employees” of the fund.
Most of the other changes fill in gaps that shouldn't have existed: expanding the definition of spouse and adding orgs with >$5MM assets (including tribes, family offices, etc.). YC relevant: "demo days" will not constitute a general solicitation.
Overall a welcome change. I assume that they'll use an existing set of professional certifications in finance, which tend to require non-trivial self-study, so it'll probably also create a market for short educational programs offered by accredited institutions.