Regulation D has multiple exemptions but in a typical 506(b) private placement, by far the most common type of offering, there is no clear path to allowing family and friends to invest. Since Rule 504 and 505 do not allow for unaccredited investors

Since its enactment, issuers—from the smallest start-ups to the largest investments and hedge funds—have used Rule 506 under the Securities Act of 1933 in the sale of securities. The Rule, which is the most widely used exemption from the registration requirements of the Act, generally allows issuers to sell an unlimited amount of securities to…