As fireworks light up the sky this Independence Day, the Capital Ideas podcast spotlights a different kind of freedom – economic freedom – with a timely discussion on who gets to invest in America.
While most Americans can buy luxury goods online, bet on sports apps, or trade volatile cryptocurrencies at the tap of a screen, they remain locked out of investing in startups and small businesses – the engines of American innovation and local job creation.
Why? Because of an outdated Securities and Exchange Commission (SEC) rule that limits participation in private market investing to “accredited investors,” a designation that requires a $1 million net worth (excluding a home) or $200,000 in annual income. These thresholds leave most Americans sidelined from high-growth opportunities.
But this Independence Day brings new hope.
In a special episode of Capital Ideas, policy veteran Dina Ellis Rochkind, a leading architect of the JOBS Act of 2012, joined the show to unpack how Congress might once again rise to the occasion and democratize capital access for all.
Now Counsel for Government Affairs and Strategy at Paul Hastings, Rochkind shares an insider’s perspective on how smart, inclusive policy and bipartisan momentum could open the door to wealth-building investments for more Americans.
Reimagining Who Gets to Invest
At the heart of the discussion is H.R. 3394, the Fair Investment Opportunities for Professionals and Experts Act. The bill, recently passed by the House, seeks to broaden the definition of an accredited investor by recognizing professional credentials. But it also proposes codifying the existing financial thresholds – potentially freezing them into law and limiting the SEC’s ability to adapt.
Rochkind, whose legacy includes shaping the JOBS Act that revolutionized equity crowdfunding, sees both promise and risk.
“The JOBS Act was a once-in-a-generation moment,” she notes. “But moments like that can happen again – if we get this right.”
It’s essential for both chambers of Congress to strike the right balance. While lawmakers are rightly concerned about the SEC straying from legislative intent, locking rules into rigid statutes risks making them obsolete as markets evolve.
Notably, although Congress first introduced the term “accredited investor” into the Securities Act in 1980, it left the details to the SEC.
The Commission subsequently defined the standard in 1982 and has retained discretion to update it via rulemaking ever since – most recently in 2020, when it expanded eligibility to certain credentialed professionals.
Rather than freezing the rules in place, Rochkind champions a more flexible, forward-looking approach – one that prioritizes investor education and provides the public with practical tools to participate in private markets, rather than continuing to shut them out.
Inside the Legislative Engine
Rochkind also offers a rare behind-the-scenes glimpse into how financial legislation is created.
Bills like H.R. 3394 typically begin with congressional staff drafting language in collaboration with a wide range of stakeholders – including lobbyists, regulators, consumer advocates, and industry voices.
Once introduced, a bill undergoes committee review, during which it is debated and refined. However, in the fast-paced world of policymaking, compromises and technical gaps can unintentionally introduce problems, particularly in complex regulatory environments such as securities law.
Still, bipartisan support can accelerate progress. When a bill passes the House under “suspension of the rules” – a process requiring a two-thirds majority – it signals strong consensus and builds momentum for parallel efforts in the Senate.
One such effort is Senator Tim Scott’s Empowering Main Street in America Act (S.5139), which proposes a new, education-based pathway to becoming an accredited investor. Rochkind views both bills as opportunities to promote financial literacy and economic inclusion, particularly for underserved communities that have been long excluded from early-stage investing.
The Case for a Smarter, Fairer Investor Test
Instead of relying on wealth to determine investment rights, Rochkind and other experts propose a more inclusive education-based pathway – a simple, practical exam to become an accredited investor.
Current options, such as the Series 65 exam, are designed for financial professionals and often fail to cover the real-world skills investors need to navigate the private market.
Rochkind expressed enthusiasm for this vision, calling it “an opportunity for financial literacy” and a gateway for broader public participation in private markets. But she cautioned that delegating exam design to FINRA might undermine that goal.
“We don’t want a repackaged Series 65,” she said. “We need something new, practical, and focused on real-world understanding – not theoretical finance. We need to teach people how to research a company, spot red flags, and understand risk.”
Crowdfunding, Crypto, and the American Dream
For entrepreneurs and platforms in the crowdfunding ecosystem, the stakes are high. If accredited investor rules remain static, everyday Americans will continue to be shut out of early-stage investing – while the wealthiest reap the rewards.
But thoughtful reform could transform crowdfunding, injecting fresh capital into startups and enabling more Americans to participate in the next wave of innovation.
“This is about aligning policy with reality,” says Rochkind. “Gen Z wants to invest. They’re already experimenting with crypto and meme stocks. Let’s give them a safer, smarter way to back emerging businesses – and grow with them.”
An Independence Day Call to Action
Rochkind’s message is clear: the moment is now. Whether or not sweeping legislation passes this year, every hearing and floor debate shapes the future. The SEC is listening. So is Congress.
To the crowdfunding community and investor advocates: educate policymakers. Share real-world stories. Show how modernizing these rules helps real people.
“The JOBS Act taught us that change is possible – and that it can happen quickly when the stars align,” she reflects. “Let’s not miss this moment to open the doors of investment opportunity to all Americans.”
Nick Morgan is President and Founder of ICAN, the Investor Choice Advocates Network, a nonprofit public interest litigation organization dedicated to serving as a legal advocate and voice for everyday investors and entrepreneurs. He was previously a partner in the Investigations and White Collar Defense Group at Paul Hastings law firm. Morgan previously served as Senior Trial Counsel in the SEC’s Division of Enforcement. Capital Ideas is a series created by Morgan and Dara Albright.