What is the definition of an accredited investor?

An Accredited Investor, in the context of a natural person, includes anyone who:

  • earned income that exceeded $200,000 (or $300,000 together with a spouse) in each of the prior two years, and reasonably expects the same for the current year,

OR

  • has a net worth over $1 million, either alone or together with a spouse (excluding the value of the person’s primary residence).  This excerpt definition is taken from the SEC.gov site.

What is the definition of a sophisticated investor?

A Sophisticated investor is considered to have sufficient financial knowledge to understand the benefits as well as the risks of an investment opportunity.