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.
GCV
Insights
Industry Insights
Lauren Miller
· 1 min read
· Updated on

It's good news for the region: the North East (JEREMIE) Fund is going live

After much delay, it was brilliant to hear recently that the £120m fund to support the growth of businesses in the North East region is set to go live early this year.

Also known as the 'JEREMIE' fund, the entire focus is to provide an array of equity investments and loans to support the growth of organisations in the North East Local Enterprise Partnership (LEP) area.

The fund is an important part of investment into the region, sitting directly alongside the Northern Powerhouse Investment Fund (NPIF), collaboratively driving growth to what's expected to be thousands of Northern businesses.

Specifically regarding the North East Fund, over 600 businesses are anticipated to be supported, with over 3,500 jobs created as a result.

Speaking about the recent news, Helen Golightly, executive director for the North East LEP, explained “Our project team has been working continuously with HM Treasury and the EIB behind the scenes to make this fund a reality. Both have been committed to the new Fund from day one and we are grateful to them for their support. This hugely positive decision, though still subject to contract, is a real coup for the north east and, critically, enables us to retain independence and local control  over how these funds are used."

Got a question about the fund and how it can support you and your company in the region? Drop us a line and I'd be happy to discuss the benefits.
Driving Growth.
Creating Value.
Delivering Impact.

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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.