Glossary

Sophisticated Investor

A Sophisticated Investor is defined in the Financial Services and Markets Act 2000 (Promotion of Collective Investment Schemes) (Exemptions) Order 2001. There is a standard definition that Business Angels will need to sign in order to make investments in small companies. For the purposes of the act, a sophisticated investor is defined as follows:

I am a self-certified sophisticated investor because at least one of the following applies
  • (a) I am a member of a network or syndicate of business angels and have been so for at least the last six months prior to the date below;
  • (b) I have made more than one investment in an unlisted company in the two years prior to the date below;
  • (c) I am working, or have worked in the two years prior to the date below, in a professional capacity in the private equity sector, or in the provision of finance for small and medium enterprises;
  • (d) I am currently, or have been in the two years prior to the date below, a director of a company with an annual turnover of at least £1 million.

See the definition of High Net Worth individual

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