Don't invest unless you're prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong.
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Risk Summary

Estimated reading time: 2 min

Due to the potential for losses, the Financial Conduct Authority (FCA) considers this investment to be high risk.

What are the key risks?

  • You could lose all the money you invest
  • Most investments are shares in start-up businesses or bonds issued by them. Investors in these shares or bonds often lose 100% of the money they invested, as most start-up businesses fail.
  • Checks on the businesses you are investing in, such as how well they are expected to perform, may not have been carried out by the platform you are investing through. You should do your own research before investing.

You won't get your money back quickly

  • Even if the business you invest in is successful, it will likely take several years to get your money back.
  • The most likely way to get your money back is if the business is bought by another business or lists its shares on an exchange such as the London Stock Exchange. These events are not common.
  • Start-up businesses very rarely pay you back through dividends. You should not expect to get your money back this way.
  • Some platforms may give you the opportunity to sell your investment early through a 'secondary market' or 'bulletin board', but there is no guarantee you will find a buyer at the price you are willing to sell.

Don't put all your eggs in one basket

  • Putting all your money into a single business or type of investment for example, is risky. Spreading your money across different investments makes you less dependent on any one to do well. A good rule of thumb is not to invest more than 10% of your money in high-risk investments. Learn more here.

The value of your investment can be reduced

  • If your investment is shares, the percentage of the business that you own will decrease if the business issues more shares. This could mean that the value of your investment reduces, depending on how much the business grows. Most start-up businesses issue multiple rounds of shares.
  • These new shares could have additional rights that your shares don't have, such as the right to receive a fixed dividend, which could further reduce your chances of getting a return on your investment.

You are unlikely to be protected if something goes wrong

  • Protection from the Financial Services Compensation Scheme (FSCS), in relation to claims against failed regulated firms, does not cover poor investment performance. Try the FSCS investment protection checker.
  • Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA-regulated platform, FOS may be able to consider it. Learn more about FOS protection here.

If you are interested in learning more about how to protect yourself, visit the FCA's website here.

For further information about investment-based crowdfunding, visit the crowdfunding section of the FCA's website here.
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Lauren Miller
· 3 min read
· Updated on

Co-investment collaboration: Crowd & Venture Capital

GrowthFunders are pleased to announce the collaboration of our first investment opportunity with the market leading crowdfunding platform, Crowdcube.

Having attracted anchor investment through the GrowthFunders platform from Finance Durham (managed by Maven Capital Partners), Intelligence Fusion will now be offered to retail investors through the Crowdcube platform.

This collaboration will boost exposure for Intelligence Fusion significantly, not just for the purpose of the investment opportunity but additionally for the general awareness of the platform and service.

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About Intelligence Fusion

The Durham-based business, which was set up in 2015, provides a platform to help security companies and global businesses manage risk and security issues by collecting, analysing and disseminating intelligence.

After successfully raising funds for their proof of concept round through GrowthFunders, Intelligence Fusion is now raising capital to enhance its platform with more features to provide global coverage at greater speed, frequency and quality.

Looking to raise total of £400,000 growth capital, Intelligence Fusion ran an online campaign through the GrowthFunders platform to attract professional investors while meeting with Institutional Investors to ensure the round was anchored by the most suitable partner.

The online campaign attracted a quantum of £166,400; £66,400 from the G Ventures Network of Professional Investors and a £100,000 anchor investment from the Finance Durham Fund to develop its online global intelligence and risk management system.

Additionally, the campaign attracted investment that placed the campaign into overfunding. However, once the online campaign was concluded and we moved to financial close, the additional investment was unfortunately unable to be completed within the required timescales.

Through the collaboration, we're now excited to be providing the opportunity to Crowdcube's investor base.

With Intelligence Fusion planning to become a global intelligence leader in five years with annual revenues of circa £5.5m, the company has already had an acquisition approach from a US intelligence company.

Having clients including private security companies, banks and government agencies to name but a few, one of the world’s largest private intelligence companies currently has an exclusive subscription to the Intelligence Fusion platform so they can integrate the data into their existing platform.

Moreover, one company that pays to access Intelligence Fusion is currently protecting one of the largest movie franchises filming globally.

Intelligence Fusion also cites a three star NATO general who, in July 2016, said of its reporting “I just wanted to let you know I look for your Fusion updates every day! Your straight-forward presentation and solid analysis is most helpful; I am impressed by the product timeliness as well.”

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Who are Crowdcube?

Crowdcube are a well known equity crowdfunding platform with access to some of the most experienced investors in the UK.

Their crowdfunding platform, alongside our co-investment platform, will strengthen the offering for the entrepreneur and investor alike.

The Intelligence Fusion pitch is now live on the platform and Crowdcube are delighted to be collaborating with GrowthFunders, opening this opportunity to their network of investors.

This is an exciting new relationship and we are delighted to be able to share Intelligence Fusion with Crowdcube's investors as the first collaboration and look forward to a successful example of co-investment across all networks.

What is co-investment?

Co-investment is the investment into an equity funding round where the funds come from several sources including institutions, angel investors, high-net worth individuals and retail investors.

Our co-investment model is one which brings together different types of investors into the same round or deal on identical terms.

This means institutional money that requires ‘matched funding’ can be enabled on the platform whilst opening up some of the more thoroughly prepared investment opportunities to sophisticated investors and high net worth individuals.

Once this has been carried out and the round has been ‘anchored’ it can then be opened up to the ‘crowd’ via channels such as Crowdcube. This lets everyday retail investors buy shares into some of the most innovative high-growth SMEs in the startup market.

As detailed above, as a co-investment platform our approach is to work with professional funds to anchor the round and co-invest with suitably qualified retail investors.

In this spirit, we are delighted to be taking this investment opportunity forward and collaborating with one of the UK’s leading private equity platforms, Crowdcube.

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Campaign plans

As this campaign is taking a collaborative approach, Crowdcube will be promoting Intelligence Fusion alongside ourselves in striving towards the total funding goal of £400,000.

This will expose the opportunity to not only the GCV and GrowthFunders network, but the extensive Crowdcube network of investors.

This exposure at this stage of the business will set Intelligence Fusion up with a vast array of advocates and business angels who will work together to take the company to their next stage of growth.

As a global, scalable software business, Intelligence Fusion are aiming to become the leading situational awareness platform within five years - enabling companies and individuals to better protect their people and assets.

To view the Intelligence Fusion opportunity on Crowdcube, click here.
Driving Growth.
Creating Value.
Delivering Impact.

Backed by

Growth Capital Ventures (GCV) is backed by funds managed by Maven Capital Partners, one of the UK’s leading private equity and alternative asset managers.