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An angel investor (Russian private person) asked us while we were discussing SAFE. There is a point that he should be an accredited investor. What is the best way to answer this from the legal side?

Mia Scott avatar
Written by Mia Scott
Updated over 4 years ago

You can use an accredited investor questionnaire that gives a few options for them to choose from.

Friends/Family fall into either "net worth over 1M (excluding primary residence) or reasonably expects individual income over 200K this year and had that level for the last 2.

If someone doesn't fit the accredited investor categories, think carefully- consider thinking about their ability to handle the risk - what happens if you lose it/fail?

The SEC approved specific rules that limit the amount a non-accredited investor can invest. Those with an annual income or net worth that is below $100,000 are limited to investing no more than $2,000 or up to 5 percent of the lesser of their net worth or annual income. Those making at least $100,000 have a 10 percent cap of either their net worth or annual income.”

For more information regarding accredited investors, you can read here: https://www.upcounsel.com/how-to-invest-without-being-an-accredited-investor

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