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
Company News
Craig Peterson
· 2 min read
· Updated on

Investing together for growth

Earlier this month, Norm Peterson - GCV's co-founder and CEO - spoke to BQ about the importance of investing for growth, and how the co-investment approach is such a beneficial way of doing so.

At GCV we identify and structure investment opportunities that have the potential to deliver market-beating returns to investors alongside wider positive social and environmental benefits. This is something that's been driven even further forward by our investment from Maven in December 2016.

In the article, Norm explained regarding Maven how "there’s a strong strategic fit and we are exploring opportunities where our investors can co-invest alongside Maven and other institutional investors into high growth businesses and property related projects."

Craig Peterson and Norm Peterson of Growth Capital Ventures

Having an ever-expanding investor network that invests into the opportunities presented, such opportunities are vast and varied.

Discussing the investment opportunity into Atom, one of the UK's leading challenger banks, Norm explained "over 40 members of the GCV Investor Network invested £1m into Atom, alongside one of Europe’s leading hedge funds...there was a lot of interest, the offer was oversubscribed within a few days with GCV members investing between £10,000 and up to six-figure sums."

Whilst on the importance of co-investment and investor collaboration, Norm went on to say how "We want to make it simple for everyday investors to participate in growth-focused investment opportunities and build a diversified portfolio. Investing online means members can review investment opportunities at a time that’s convenient for them and invest into carefully selected investment opportunities, many of which offer generous tax reliefs designed to minimise downside risk and maximise potential returns."

The co-investment approach is something we've driven forward both online and off, with the launch of our G.Ventures Investor Club in Q4 of 2017, bringing together an exclusive group of high net worth individuals who will meet monthly and will be briefed on new investment opportunities in which they can invest anything from £10,000 to £250,000, perhaps five or six times a year.

On the G.Ventures Investor Club, GCV's Head of Operations and Investor Relations Jordan Dargue explained "Our members tend to be entrepreneurs themselves, and they are keen to back the next generation of entrepreneurs, they are also keen to diversify and get involved in property related deals. The common theme is that the investment opportunities can demonstrate the potential to deliver better risk-adjusted returns than typical mainstream investment products."

Download our 'integrating property investments into your portfolio' guide

Elaborating further on the investment opportunities presented, Norm highlighted how "we see a lot of investment opportunities but only take forward a small number where we feel we can add real value. We work very closely with the entrepreneurs we support. In many cases, particularly earlier stage businesses, the entrepreneur has a solid idea and needs help to prepare and present the business as a robust investment opportunity."

"It can be the same for a property project. We look for an opportunity where we can see something different, an angle where we can add value. On property development projects it might be an option to improve the layout of a scheme and enhance sales values. Whereas an early stage business we might work with the founders to enhance the business model and revenue model."

Going on to discuss Intelligence Fusion, the combination of institutional investors and angel networks, you can read the piece in full on BQLive.co.uk.
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.