In short, YES. According to FCA and SEC regulations, you have to be a sophisticated investor to invest in alternative investments such as private deals, venture capital, angel syndicates, etc.
An accredited / sophisticated investor has a strong understanding of the risks associated with alternative investments gained through experience in the sector and/or exceeds a specific net worth or income threshold depending on the regulation of the country they are resident of. If your investors do not meet these requirements, you may be legally liable.
For the type of transactions we are engaging in (private deals, not marketed publicly anywhere), it is sufficient for the investors to confirm they are sophisticated via a checkbox or questionnaire.