Simply put, a syndication is when a group of investors pool their money to purchase an investment. At Illuminate Capital, our offerings are set up as partnerships with both Limited and General Partners. Our passive equity investors are considered Limited Partners.

While a 506(b) offering may accept up to 35 non-accredited investors, a 506(c) offering requires all investors to be accredited according to Securities Exchange Commission (SEC) guidelines. It depends on the specific offering as to whether it is structured as a 506(b) or 506(c) offering and thus whether an investor would be required to be accredited to invest in the specific offering.

An accredited investor is an individual with a net worth or joint net worth with a spouse or spousal equivalent of at least $1 million, not including the value of his or her primary residence or an individual with income exceeding $200,000 in each of the two most recent calendar years or joint income with a spouse or spousal equivalent exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year. Visit sec.gov for more information.

In general, investments as a Limited Partner are not liquid. While there may be provisions in the subscription documents that outline how a Limited Partner may liquidate their interest in the syndication, investors in our offerings should consider their capital as illiquid for the duration of the business plan outlined in the operating agreement.