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
Jenna Taylor
· 4 min read
· Updated on

End-of-year pitch update for HiveHR: employee engagement software

Please note: this investment opportunity is now closed. To be informed of future funding rounds, please make sure you are a GrowthFunders member. You can do that here.

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Named the "small startup with huge ambitions" by their sister and incubator company, award-winning eCommerce business Visualsoft, the Hive team are certainly on a mission to get employees engaged, motivated, and happier.

Based on Teesside (but with offices in London and targeted sites in Edinburgh, Manchester, Leeds, and Birmingham as part of their ambitious growth plans) Visualsoft are hot stuff. Alongside supporting Hive, they recently opened their impressive new headquarters in Stockton and now look set to take the crown for "coolest office", as well as celebrating a hat trick of nominations at The Employee Engagement Awards 2015.

I recently caught up with Founder and Managing Director of Hive, John Ryder, to get an update on the team's fundraise and find out their plans for 2016.

Hive_web Hiring

Following the appointment of our first key hire, we have been busy, well, bees...

Jamie Burnip joined us as a PHP Software Engineer in October to help Visualsoft CTO, Matt Burton, complete the final stages of development, prior to beta testing and launching.

We also recently hired an Enterprise Sales Manager, Theo Fitzharris, who will join us from Nigel Frank International in mid-January. Theo will focus on generating, nurturing, and closing business with companies of 250 employees or more.

Our core focus for the next couple of months will be to develop and introduce some new features based on the feedback we are currently receiving and the work our team has been carrying out.

We launched our investment campaign on the GrowthFunders platform back in October, and have been working extremely hard to develop and build the software which enables employers to better understand, measure, and improve employee engagement within their organisation. 

Demos

I've been demoing the software, both online and face-to-face, to a number of businesses, including one of the UK's largest challenger banks who are looking for a progressive way to engage with their employees.

Hive has also been demoed to HR Dept, a consultancy business which provides outsourced HR services to a national client base of 4000 SMEs via a network of licensees - as well as a handful of big brands including Volvo and The Body Shop. They're growing and have a really impressive track record when it comes to customer satisfaction.

There's scope for a non-exclusive partnership arrangement where their licensees will earn a comission for referring their clients to Hive. It would be a mutually-beneficial relationship because our business model doesn't include providing consultancy or training to clients - but naturally, that's something that the HR Dept are very well placed to do.

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Early adopters

Excitingly, we were able to launch an early version of the Hive software in November and it has already been linked to a number of early adopters, including Spark Response. 

Spark Response are an order-fulfilment and contact centre services provider whose clients include BT, Toys R Us, FitFlop, Soap & Glory, and Micro Scooters. They've always recognised the importance of employee engagement and immediately tuned into how Hive will help further boost engagement levels within its 200+ workforce. They will begin using Hive in January.

Another early adopter is a leading Teesside business law firm who are looking to further boost engagement in their 44-strong workforce and continue to grow their positive company culture.

It's fantastic to be able to work with such forward-thinking businesses at this early stage.

Success in the marketplace

A Seattle-based startup, which operates in a similar space to Hive - replacing out-dated annual reviews in order to better assess how engaged employees are - is demonstrating how this kind of Software-as-a-Service (SaaS) proposition is scaling in the US.

The US's leading pulse survey and peer-to-peer recognition platform, TINYpulse, has recently closed out a $6 million round, led by Arthur Ventures. You can read the full story on GeekWire.

In the US, TINYpulse is doing fantastically despite competition from OfficeVibe and Waggl. At the moment, there is no such competition for Hive in UK. However, I am confident that the UK is large enough to support serious competition if one or more were to surface here.

The story of TINYpulse's recent funding round offers fantastic validation for Hive, showing the potential for growth in the UK and the value that can be created in businesses like this.

I am also confident when it comes to Hive's setup regarding customer success and sales, which is something I believe comes from mine and Visualsoft's previous experiences of gaining and retaining customers.

Impact Hive will deliver

Health and well-being

Hive enables employers to measure the engagement, motivation, productivity, and overall happiness of their workforce. Through weekly surveys problems, suggestions, and queries can be highlighted and addressed quickly in order to maintain a pleasant working environment. Employee engagement analysis is a rapidly growing market and one Hive is well-equipped to take over.

Skills and employment

As well as the health and well-being impact Hive delivers, the business is also focussed on professional development and furthering the skills of workers. Through weekly feedback, employees can highlight areas in which they believe they, the team, or the entire company would benefit from training.

Underserved areas

Hive are also keen to replicate the success of Visualsoft, their incubator company, in terms of job creation in an underserved area of the UK. Visualsoft has successfully grown from a startup to one of the largest private employers in Stockton-on-Tees, creating 200+ jobs along the way. The company places great importance on creating a pleasant, fun, and smooth workplace environment in order to attract and retain top talent.

Potential investors

Behind-the-scenes, I've been working hard to secure the investment we need to kickstart our growth journey. With some fantastic support from the GrowthFunders team, I've had a number of advanced conversations with some seasoned professional investors. This is exciting news and we will continue to keep everyone posted on our progress. Here's to an exciting 2016.

Speaking of which...

The GrowthFunders team would like to wish John and his wife Ailsa a huge congratulations on the birth of their daughter, Remy Beatrice: The best early Christmas present ever!

Hive's funding round has now ended but you can still use their pitch page to stay up-to-date with progress.

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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.