Legal Question in Investment Law in California

Re: Accepting money from multiple people to start my company

There are three kinds of securities offerings: registered, exempt, and illegal. You obviously aren't planning to register your proposed offering with the Securities and Exchange Commission, so in order to avoid an unplanned five-year "vacation" in Leavenworth, Kansas you need to not only figure out, but become very conversant with, the relatively few exemptions from registration that are available. A few of the more commonly relied-upon exemptions are based on SEC Regulation D, and include so-called Section 504, 505 and 506 exemptions.

The exemptions that are potentially available contain restrictions on various aspects of the offerings, including, importantly in your case, the number of persons who can be solicited or invest. There may be one or two exemptions that allow contacting more than 1000 potential investors, but typically there would be other restrictions such as a strict cap on the amount raised, investor qualification requirements, or a ceiling on the amount raised.

These are just the Federal aspects; eact state in which you might offer securities has its own regulations, often more strict than the feds.

The bottom line is that your plan raises a huge red flag; it is obvious that you have no idea what you are doing and that it is 99% likely very very illegal, and you need to get on an whole 'nother level of financial sophistication before you try this, or anything resembling it.