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.
Insights
Investing Capital
Lauren Miller
· 2 min read
· Updated on

Investing for growth or impact? Invest for both

Investors have varying reasons for putting capital into projects or businesses. Some invest for financial returns primarily or exclusively; investing their money with the view to generate financial gains over a period of time. This has arguably been the most common reason for investing traditionally.

Others invest to make a positive change in society, the environment, or the world as a whole. They want to make a genuine impact, and this forms a key part of the decision making process to invest.

There is then a third group of investors who invest for both growth and impact.

What is impact investing?

"Investments made into companies, organisations, and funds with the intention to generate a measurable, beneficial social or environmental impact alongside a strong financial return" - Global Impact Investing Network (GIIN)

Impact investments are those made into projects and businesses with the intention of generating positive social and environmental impact, as well as delivering a financial return. From the funding of high growth technology businesses that generate jobs in under-served markets through to backing projects that deliver much-needed, low-carbon, affordable homes, there are impacting investing opportunities to suit most.

The impact investment market is growing at a rapid pace, with investors seeing higher returns than their average financial investment - and obviously able to feel good that their money is making the world a better place.

Historically, impact investing has only been available to high net worth individuals who invest large sums of money into specialist funds. Investors with a lower net worth were traditionally never given the opportunity to invest, as the option simply wasn’t available - until now.

With the introduction of co-investment platforms like ours at GrowthFunders, retail investors can now invest smaller sums of money into a range of investments alongside institutional and angel investors. Whilst still having a level of risk associated with them, these bring the potential of higher returns and have that 'do good' impact.

The four pillars of growth and impact investing

investing for growth and impact graphic.png

At Growth Capital Ventures we focus on originating impact driven investments for our co-investment platform that have the potential to deliver superior investment profit precisely because there's a real purpose underpinning them.

Our vision is to be the leading developer of online co-investment platforms, allowing investors to access the best possible deals that offer the deliver returns for both growth and impact.

Choosing impact or growth isn't a decision you need to make

Many investors are cautious of 'impact investing', believing that in order to invest for positive social change, they will have to face the prospect of slow or minimal returns.

However, you don’t have to choose between capital and caring when it comes to investing for growth or impact; finance-first investing means you can genuinely do some good in your local community or the wider world whilst targeting competitive returns.

In fact, research is increasingly showing that impact investing doesn’t require a trade off. A report by Morgan Stanley’s Institute for Sustainable Investing surveyed over 10,000 equity mutual funds and found that returns have “actually met or exceeded the median returns of traditional equity funds”.

The benefits of investing for growth and impact

  1. The potential for superior returns
  2. Potential for longer-term, sustainable growth on investment
  3. The ability to diversify across a number of sectors and investment types
  4. Making a positive difference towards a better future
  5. Seeing a measurable social, environmental or economic change 

"At GrowthFunders, we’re pioneering an online co-investment platform that allows a range of investors to invest directly into businesses and projects that deliver growth and impact." - Craig Peterson, COO, Growth Capital Ventures

View our live tax efficient investment opportunities
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.