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.
Insights
Jenna Taylor
· 4 min read
· Updated on

Intelligence Fusion: end-of-year update with growth and impact report

It's been six months since online information-sharing platform, Intelligence Fusion successfully closed out their POC round. The subscription-based forum crowdsources information from around the world, enabling users to share intelligence, news of incidents, and risk awareness in real time.

Forum moderators group discussions from Intelligence Fusion's online community in order to focus the information and maintain relevance and usefulness.

The startup had originally set out to raise £15,000 but attracted interest from an institutional investor and ended up closing out at £22,500.

Click here for the full story on how Intelligence Fusion attracted online angels and a VC to overfund.

I recently caught up with Founder, Michael McCabe, for an update on Intelligence Fusion's plans for 2016, including:

  • The development and launch of the software,
  • How he plans to build the membership base,
  • How the company plans to deliver positive social and environmental impact alongside financial returns for investors,
  • His plans to recruit interns.

GrowthFunders: What have you been up to since the POC funding round closed out?

Michael: The capital raised in our POC round enabled me to work with developers to create and prepare to test the platform in real-time situations. Now, we are about to begin monetising the platform and offering subscriptions to paying users, having just sold our first subscription to a security company who supports non-governmental organisations (NGOs) in Africa and the Middle East.

GF: What are the next steps for Intelligence Fusion?

M: Our current focus is on Syria, Iraq, Libya, Egypt as well as maritime criminality, but in the new year we will be expanding the countries we monitor to include:

Intel_Fusion_monitor

The reasons behind the countries we have chosen to focus on are extremely varied. For example, the 2016 Summer Olympics are taking place in Rio, Brazil which means that there will be thousands of people in attendance.

A lot of those people will be travelling (or thinking about travelling) from other countries and may want to find out more about situations in Brazil, prior to visiting. Intelligence Fusion will be working to build a community of users based in Brazil who can then share real time information with people both inside and outside of the country before, during, and after the games.

GF: How will you start to build the platform's membership base?

M: At the moment, our focus is very much on larger SMEs and corporations operating in and exporting to emerging markets. By sharing information they have or need, we can begin to help people make informed decisions which should then lead to the forum becoming the main point of contact for these companies.

The online community we are building will eliminate the confusion and uncertainty of doing business in new environments by allowing users to plug into new networks as and when they require. With Intelligence Fusion Analysts providing information on the threats and hazards of that country, users can then network with other subscribers and enable operations through close collaboration.

One initiative we are keen to introduce is a reward scheme, where customers can receive a percentage of their annual subscription cost by referring one or more new businesses. We feel this will help significantly grow our network to our vision of 10,000 subscribers in the next five years. The success that will come with growing the platform is something we want to share with the Intelligence Fusion community.

Join GrowthFunders and become a member

GF: How are you planning to deliver impact alongside a financial return for your investors?

M: We are in the final stages of finalising an internship programme with a local university which will provide vital experience for 22 post graduate students, helping them to get a foot on the career ladder. This will not be a one-off, but an ongoing programme, providing training and mentorship to future intakes of students.

In addition, we plan on taking on full time members of staff in 2016, providing job opportunities in the local market. Also with tools such as our Exchange Module, subscribers to our platform can enable operations helping them do business in foreign markets and therefore creating jobs and revenue in emerging economies.

Our new "How it works" video provides more information.

GF: What specific impact themes will Intelligence Fusion be targeting?

growthfunders_4_themes-1-500644-edited

M: The company will deliver on the following:

  1. Growing and underserved markets

    The idea is that by aiding operation in and export to emerging markets, we can also encourage growth. If businesses feel more comfortable about the risks and challenges they face in other countries, they may consider expanding into those countries. This results in job creation which will obviously then have a huge knock-on effect.

    Businesses operating in BRICS (Brazil, Russia, India, China, and South Africa), for example, would benefit hugely from the aid Intelligence Fusion could provide as they make their way to becoming five of the most dominant economies by the year 2050. We would look at employing designated analysts whose focus is on specific areas ensure clarity of information. The potential catalyst for growth that Intellince Fusion could provide is phenomenal.

  2. Employment, skills, and training

    We have established links with a local university and are looking to provide 20 undergrads with internships, initially to give them an opportunity to work with Intelligence Fusion to assess incidents and risk globally and to disseminate this information and share it on the platform.

    Longer term, we are looking to provide employment opportunities for post graduates and apprenticeships for software developers and content creators. We are based in County Durham, which is a fantastic part of the UK, but is classed as an underserved area. I am delighted to be starting up and growing a software company that will provide some exciting employment opportunities for talented people in the North East.

    In addition to partnering with universities, we are offering our internships to individuals with the relevant career interest and background. Although this is an unpaid internship, students gain practical hands-on experience, ongoing training from highly-experienced intelligence analysts, as well as personal exposure and the ability to network with major companies and organisations.

    Interns under the guidance of mentors, remotely monitor a country of their choice, helping to develop the intelligence picture. The platform currently has registered senior representatives from numerous prominent companies and non-government organisations. With the mentoring and support of Intelligence Fusion Analysts, interns will operate using their own names, giving their reporting and analysis unrivalled exposure.

    With a crowd sourced business model, we feel we can greatly improve the quality of intelligence on the market, in addition to making it accessible for small and medium sized enterprises.

    Intel_Fusion_recruits

  3. Health and well-being

    One of our key objectives is to help SMEs who operate globally understand the risks associated with the geographical locations that they are doing business in. In particular, it is for businesses whose employees are visiting new countries and who need to understand how to brief their employees on local culture to ensure that their business trips are as safe as they possibly can be. By managing risk, we can help to keep people safe in challenging areas and situations.

  4. Economic growth

    Emerging markets need external investment in order to stimulate economic growth. Going back to the first impact theme of job creation in underserved areas and the knock-on effects that provides, this can encourage inward investment which could then go towards kickstarting an economy. Let's take Africa as an example: the most positive impact that this continent could get would be investment from sovereign wealth funds, large corporates, and large SMEs to help stimulate economic growth.

GF: What are your next steps?

M: We will be working to launch, attract subscribers and build the Intellince Fusion community, and identify the Key Performance Indicators (KPIs) which will enable us to drive growth and impact within our business.

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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.