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

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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
Investment Campaigns
Dan Smith
· 5 min read
· Updated on

New partnership beats funding target

Technology business Intelligence Fusion, IF, has broken through its £400,000 target and has gone on to raise over £486,000 to further develop its online global intelligence and risk management system.

This represents an early success for the new partnership between Growth Capital Ventures (GCV) and Crowdcube, an extension of GCV’s groundbreaking investment model which allows retail investors from the general public to invest alongside experienced and sophisticated investors and financial institutions.

The success of IF’s fund raising coincides with the Chancellor’s Budget proposals to stimulate investment in high growth businesses by attracting £20bn of new investment.

GCV combined its own expertise in preparing IF for market, its investor network and access to venture capital funds with access to Crowdcube’s own huge army of 440,000 registered members.

Before using the Crowdcube platform to raise a further £135,000, IF - a software-as-a-service business that helps security companies and global businesses manage risk - secured more than £352,000 through GVC’s own online co-investment platform GrowthFunders. This included £150,000 from the £20 million Finance Durham Fund set up by Business Durham, the economic development organisation for County Durham, on behalf of Durham County Council. The Fund is managed by Maven Capital Partners, one of the UK’s most active private equity houses and SME finance providers, to support the growth of high potential businesses located in, or looking to relocate to the County.

GCV chief executive Norm Peterson said: “We are delighted that Intelligence Fusion has not only achieved but beaten its fundraising target. This demonstrates two things. One, that it is an exciting business with a compelling business plan and an impressive management team and, second, that GrowthFunders, in partnership with Crowdcube, can successfully guide ambitious, high growth companies through the fundraising process and introduce them to a wide and varied range of investors. This model allows retail investors to co-invest alongside experienced and institutional investors.

“Having worked with Michael McCabe and the team at IF for several years, assisting them with their proof of concept round previously, we're pleased to have been able to support their significant growth between their first round and their current round and that we have helped them achieve this key milestone as part of their continued growth.’’

Adam Gillet from Crowdcube said: “We are delighted to have our first successfully funded deal working in collaboration with Growth Capital Ventures and could not be more pleased for the team at Intelligence Fusion to have secured well over their original £400,000 target. 

“This serves as a great example of how different players in the equity funding market can work together smartly and efficiently to deliver great results, freeing up more time for founders to do what they are good at - running their businesses. 

“The Inclusion of Finance Durham’s Investment fund in the round is a welcome addition and we intend to replicate this model with GCV to support other ambitious, disruptive businesses in the region.’’

Michael Vassallo, Investment Director of Maven Capital Partners, said, “We’re delighted to support Intelligence Fusion’s growth plans at this stage in the company’s development. This is a great fit for an investment from the part of the Finance Durham Fund allocated to support innovation and we look forward to helping more companies like them. Michael McCabe and his team are hugely knowledgeable and driven and have demonstrated that there’s a real and growing need for the technology the firm has developed across a wide range of business sectors, and we look forward to working with them in the coming months and years.”

Sarah Slaven Business Development Director at Business Durham, said: “This is another great investment for the Finance Durham Fund.  An important role for the Fund is to act as a catalyst, helping to lever in finance from other sources to benefit businesses in County Durham, so we’re very pleased to see this in action in a successful funding round for Intelligence Fusion.”

Cllr Carl Marshall, Cabinet member for economic regeneration, said: “We are delighted that the Finance Durham Fund is supporting Intelligence Fusion as it continues to grow and we wish it every success for the future.

“More and more firms are starting up in County Durham, creating jobs and boosting our local economy, and we look forward to supporting other companies which are looking to move here.”

IF is also the first external business to be incubated by GLabs, the innovation arm of GCV. This team supported IF’s management from idea stage, helping to source a software partner to launch the MVP (minimum viable product), through to the current stage. The GLabs team will continue to support IF as an integral part of their strategic partnership network.

IF, which was set up in 2014, provides an industry leading platform to help security companies and global businesses manage risk and security issues by collecting, analysing and disseminating intelligence.

The company will use the funds it has raised through GVC and Crowdcube to enhance its platform with more features to provide global coverage at greater speed, frequency and quality as part of its plans to become a global intelligence leader in five years.

Michael McCabe, founder and chief executive of Intelligence Fusion said: "The support from the team at GCV has been invaluable, particularly throughout our recent raise. The team have been involved across many areas, from helping to prepare for the raise and assisting with technical development and marketing right the way through to strategic guidance. I am deeply thankful for their support and delighted to have them on board as partners as the business continues to move forward."

Note to editors

Intelligence Fusion’s platform allows organisations to avoid information overload from the huge quantity of incidents being reported on news and social media.

By partnering with universities, it has built up a network of more than 200 people who help to populate the platform with incidents. These incidents are then analysed by experienced intelligence analysts who also add the additional context businesses require to protect people and assets more effectively.

At any one time, Intelligence Fusion has up to 75 associates working remotely, helping to populate the platform. These are usually postgraduates of various nationalities with the majority currently being sourced from Durham University’s Global Security Institute.

Michael McCabe was previously the Director of Durham Specialist Risk Management, specialising in providing intelligence and security consultancy services for global maritime and oil and gas clients. Prior to this, he was the intelligence manager for Olive Group, leading the Iraq team, working with a range of corporate clients who had operations in the country. He was also a senior intelligence officer for Aegis, providing intelligence and risk management support to the United States Army Corps of Engineers’ reconstruction efforts in western Iraq.

He started his career in British Military Intelligence, where he served in both the UK and across the Middle East.

Growth Capital Ventures (GCV) is an FCA (Financial Conduct Authority) authorised fintech business. The company works with ambitious high growth businesses and helps them to prepare and raise investment from a wide network of retail, professional and institutional investors. GrowthFunders is GCV’s online co-investment platform which has been developed to streamline the fundraising and investment process. GCV is backed by Maven Capital Partners, an independent private equity firm with over £400m of assets under management and a nationwide network of regional offices.

The GrowthFunders platform allows everyday private investors to co-invest in alongside professional and institutional investors and build a diversified investment portfolio. Many of the investment are SEIS and EIS eligible providing investors with generous tax breaks to help minimise risk and maximise potential returns.

About Maven Capital Partners UK LLP www.mavencp.com

Maven Capital Partners UK LLP (Maven) is a lower-mid cap private equity house focused on the provision of growth capital and mezzanine finance to SMEs across the UK. It is one of the most active private equity fund managers in the country, managing over £415 million of assets for a variety of client funds, including Venture Capital Trusts, UK regional debt and equity funds, and Maven Investor Partners – a syndicate of institutional, family office and experienced investors.

Headquartered in Glasgow, and with five other offices throughout the UK, Maven has nationwide coverage of the market for SME finance and is introduced to around 400 deals per year through 20 regionally based investment executives. With over 50 staff and partners, Maven executes a range of private company transactions, offers hands-on proactive portfolio management to investee companies and provides a fully integrated back-office support function to client and third party fund managers. Since 2009 Maven has invested over £285 million in SMEs across the UK.

About Business Durham www.businessdurham.co.uk

Business Durham is the economic development organisation for County Durham, working on behalf of Durham County Council to deliver the environment for business and economic growth.

It is a knowledgeable and trusted guide which connects businesses with the right funding, advice, and networks they need to grow and thrive.

Business Durham works closely with partners to encourage an enterprise culture, helping entrepreneurs to turn bright ideas into successful reality and students to develop enterprise skills to become our future business leaders.

The organisation manages a portfolio of business property and excels in finding the right space for businesses to grow – commercial office space, modern laboratories and industrial property units.

Business Durham attracts capital and inward investment to the county, and develops an innovative economy that enables companies to grow and flourish.

Business Durham builds long-term relationships to foster sustainable growth in businesses, raising economic aspirations and making Durham a place where business is done.
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.