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. Take 2 mins to learn more:
Key Risks
You could lose all the money you invest.
You should do your own research on the company and investment proposal 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. If you get the opportunity to sell your investment early through a secondary sale, there is no guarantee you will find a buyer at the price you are willing to sell. The most likely way to get your money back is if the business is bought by another business.
Putting all your money into a single business is risky.
Spreading your money across different investments makes you less dependent on any one to do well.
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. 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 here. Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance.
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 FCA’s website here.
