How Regular People Can Now Invest in Private Companies

For most of the last century, the chance to invest in private companies was reserved for the wealthy and well-connected. A change in US securities law cracked that door open: today, an ordinary person can put as little as $100 into a startup or operating business that isn't listed on any stock exchange. This guide explains who can do it, how the legal paths actually work, where to find deals, and — just as important — the risks you need to understand before you wire a single dollar.

None of this is investment advice. Private investing is one slice of a much wider menu, and for many people it should stay a small slice. If you're newer to all of this, it helps to read our beginner's starter guide first, then come back to the private-company question with the basics in place.

What it means to invest in private companies

A private company is simply a business whose shares aren't traded on a public stock market. That covers everything from a two-person startup to a profitable family business doing $50 million a year. When you invest in private companies, you typically receive equity (an ownership stake), convertible securities like a SAFE or convertible note, or in some cases revenue-based or debt instruments.

The defining trait is illiquidity. With a public stock, you can sell on a Tuesday afternoon. With a private company, there's usually no marketplace to sell into. Your money may be locked up for 5–10 years, and sometimes you never get it back. That single fact shapes every other decision in this article.

Why it used to be off-limits

For decades, US rules effectively limited most private deals to accredited investors — broadly, people earning over $200,000 a year ($300,000 with a spouse) or holding $1 million in net worth excluding their home. The logic was paternalistic but not baseless: private investments are risky and opaque, so regulators restricted them to people presumed able to absorb a total loss. The practical effect was that the highest-growth-potential asset class was walled off from almost everyone.

How the rules changed (and what they mean for you)

The 2012 JOBS Act, with rules that phased in through 2016, created legal pathways for non-accredited investors to participate. You don't need to memorize the statute, but understanding the three exemptions helps you read any deal page you encounter.

The big shift for everyday people is Reg CF and Reg A+. Both let non-accredited investors buy in, and both cap how much you can put in relative to your income and net worth — a built-in guardrail so a bad bet can't wipe you out. Equity crowdfunding is the most common on-ramp, and it's worth reading how it works in detail before you commit.

Where to actually find private deals

There are several routes, and they suit different goals, check sizes, and levels of involvement.

1. Equity crowdfunding portals

SEC-registered funding portals and broker-dealers host Reg CF and Reg A+ raises. Minimums often start at $50–$100. You browse companies, read their disclosures, and invest online in a few clicks. The trade-off: deal quality varies enormously, and the easy interface can make a risky bet feel as casual as buying a concert ticket. It isn't.

2. Angel investing and syndicates

If you're accredited, angel investing — writing direct checks into early-stage startups, often alongside a lead investor in a syndicate — gives you more selection and sometimes better terms. It demands more diligence and a bigger appetite for failure, since most individual startups don't return capital.

3. Venture funds and venture studios

Instead of picking single companies, you can invest in a vehicle that holds many. Traditional venture funds usually require accreditation and six-figure commitments. A newer model — the venture studio — builds companies in-house and, in some cases, opens its cap table to outside investors at low minimums. NexAgents operates this way: we build and run our own companies, then let everyday investors come in on the same terms as the studio, starting at $100, with contribution-based tiers (money only, money plus effort, or effort only). It's one option among many, not a substitute for understanding the asset class.

4. Secondary marketplaces

Some platforms let accredited investors buy shares in well-known late-stage private companies from existing shareholders (employees, early investors). Minimums are typically high, and access is gated. This is closer to the traditional private market than the crowdfunding world.

For a wider map of everything beyond public stocks — real estate, private credit, collectibles, and more — see our guide to the types of alternative assets.

The risks you must understand first

This is the part the slick deal pages downplay. Read it twice.

• Total loss is common. Most startups fail. With early-stage private companies, losing your entire investment is a realistic, even likely, outcome for any single deal. Never invest money you can't afford to lose completely.
• Illiquidity. There's usually no way to sell. Plan to have your capital tied up for many years, with no guarantee of an exit at all.
• No guaranteed returns — ever. Past performance, founder charisma, and a polished pitch deck guarantee nothing. Be skeptical of any platform or person who implies otherwise.
• Limited information. Private companies disclose far less than public ones. Diligence is harder, and you're often trusting a small team's judgment and integrity.
• Dilution. Future funding rounds can shrink your ownership percentage. The 1% you bought today may be 0.4% after a few rounds.
• Fraud and hype. Lower barriers attract bad actors. Stick to SEC-registered portals, read the filings (Form C for Reg CF), and walk away from pressure tactics.

Because of all this, a common-sense approach is to keep private-company investing to a small portion of your overall portfolio — money you've earmarked as high-risk — while a diversified base (index funds, a brokerage account, perhaps some income-generating assets) does the heavy lifting.

A simple framework to get started

1. Build your base first. Emergency fund, low-cost diversified investments, and no high-interest debt before you touch private deals.
2. Decide your "risk budget." Pick a fixed amount you can lose entirely without it changing your life. Many people keep alternatives well under 10–20% of their total portfolio.
3. Diversify across deals. One private bet is a coin flip with bad odds. Spreading smaller amounts across many companies is how serious early-stage investors manage the high failure rate.
4. Read the disclosures. On a regulated portal, the filings tell you who's running the company, how they'll use your money, the valuation, and the risk factors. If you can't understand it, that's a signal.
5. Expect a long horizon. Assume 5–10 years with zero liquidity. If you might need the money sooner, it doesn't belong here.

Private investing sits inside a broader category worth understanding on its own terms. For the full picture, start with our pillar guide to alternative investments, which puts private companies alongside the other non-public assets now within reach.

The bottom line

The ability to invest in private companies is genuinely new for most people, and it's a meaningful expansion of what an ordinary investor can do. But access is not the same as a good idea. These are illiquid, high-risk, long-horizon bets where total loss is a real outcome and returns are never promised. Treated as a small, deliberate slice of a diversified plan — not a lottery ticket — it can be a reasonable way to participate in businesses you believe in. Go in informed, size it sensibly, and read every filing.