How many investors can I raise capital from without a prospectus?

Under the Corporations Act 2001 (Cth), raising capital without a disclosure document is a criminal offence unless a statutory exemption applies. Startups typically rely on the small scale offering exemption under s 708(1), which permits raising up to $2 million from a maximum of 20 investors in any rolling 12-month period. The sophisticated investor exemption under s 708(8) allows unlimited offers to individuals who hold a qualified accountant’s certificate confirming net assets of at least $2.5 million or gross income of at least $250,000 for the past two years.

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