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.
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.


FinTech company offers new digital-first banking solution

Earlier this year GCV worked with Atom bank, one of the UK’s leading digital challenger banks, to close a £16m investment round to support continued growth and expansion.

Atom Bank is the UK’s first fully licensed digital challenger bank. Founded in 2014 as the UK’s first app-only bank, Atom’s mission is to build the bank their customers would want them to be.

Digital mobile banking is a high growth channel driven by the use of smartphones and is already the predominant channel for current account interactions. 

In 2020 mobile banking interactions are forecast to account for three times more interactions than internet, branch and telephone banking combined.

How did GCV support Atom?

In 2014, Atom raised £25 million to fund startup costs. The company received investment from some heavy hitters, including fund manager, Neil Woodford, veteran Venture Capitalist, Jon Moulton, and former Goldman Sachs asset manager, Jim O’Neill.

As well as appointing some key figures in the financial services sector to their team, building the app required by a digital-first bank, and raising £25 million, Atom recently received a UK banking licence from The Bank of England.

GCV went onto support Atom to close a £16 million investment round in 2017, that saw over 40 members of GCV’s private investor network (G-Ventures) invest £1m alongside one of Europe’s leading hedge funds.

With a huge amount of interest from investors who used GCV’s online investor platform to pledge, the offer was oversubscribed within a few days.

Norm Peterson, GCV CEO said:

Our investors are drawn to disruptive businesses, those that can really make a positive difference. Atom is a perfect example of a business using technology to create and maintain a competitive advantage, challenging and changing the way things are done in the banking sector. Atom’s business model was one of the reasons for the positive interest from our investor network.

How does Atom Bank make a positive difference? 

Atom’s business offering consists of Fixed Rate Saving products, Business Banking Secured Loans and Retail Mortgages.

Using technology to create real value for customers and investors, the company prides itself on automation and data at its heart.

The low cost and agile infrastructure that Atom is built upon has enabled an offering of good value products to customers with a great user experience. Products can be scaled quickly resulting in delivering returns to investors.

Having created over 300 high-quality jobs means Atom are not competing for talent in a London market that will be even more challenging as technology giants Apple, Google and Facebook plough billions of pounds into the capital.

Atom has focused on creating a business with a lower cost base than their traditional banking competitors. A technology and digital focus mean Atom are not burdened by the cost of high street branches or legacy IT systems.

This translates to huge cost savings when compared with a traditional bank. More importantly, this lower cost base means Atom can provide better mortgage rates for borrowers and better interest rates for savers.

Atom are based in the north east of England, an area with one of the highest level of youth unemployment in the UK. Partnering with The Prince’s Trust, Atom provides mentoring and workshops to young people, so they feel better prepared to find work.

As community is of huge important to Atom they recently created Atom Incubator. Based in their Durham HQ, Atom Incubator offers professional advice, space and access to a community of technology startups and entrepreneurs.

In Nov 2017 Atom was named by social media site LinkedIn as one of the country’s 25 most disruptive companies. In addition to this the business were also crowned the winner of the Mobile Banking Disruper TFG excellence awards 2017.

One year on since Atom officially launched the UK’s first bank built exclusively for mobile, they have announced as their first Strategic Board Advisor. 

The entrepreneur, philanthropist, musician and consumer technology investor will take on the role of Strategic Board Advisor at the bank that has seen over £538m of deposits as of March 2017.

With more than 17,900 savers as of March 17 and a loan book of £99m, Atom’s app is currently available on the App Store and via Google Play.

Find out more about Atom Bank

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.