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.

Weekly Briefing

Weekly Briefing: UK Bank Monzo Turns Profitable, BRICS Economic Ascension, and UK Property Market Supply Surge

This week’s briefing highlights significant developments in the global and UK economies, alongside notable advancements in the banking and property sectors. 

Key topics include Russia's rise in the global economic rankings, the growing UK property market, and Monzo's impressive financial achievements as fintech expands its footprint in the digital banking industry.

UK Business

UK Neobank Monzo Marks First Profitable Year

  • Monzo has recently reported a profit before tax of £15.4 million, a sharp contrast to the £116.3 million loss in the previous year.

  • CEO TS Anil highlighted, “This was a landmark year of record growth for Monzo,” CEO TS Anil said in a news release. “We surpassed 9m personal customers, 400,000 business customers, launched game-changing new products, closed a £500m capital raise and, as planned, reported our first year of profitability.”

  • Despite the company already planning to expand to the U.S., Monzo now plans to expand into Europe, using Ireland as a “gateway“, and introduce new products like pensions and expanded mortgage features.

  • In a related development, Atom Bank, one of our portfolio companies at GCV, also achieved its first annual operating profit in 2023, showcasing the growing demand for app-based banking models.

UK Property

UK Property Market Sees Highest Supply in Eight Years

  • The UK currently has £230bn ($293bn) worth of houses on the market, the highest supply of homes in eight years. This increased supply is expected to help keep house prices stable for the rest of 2024.

  • Zoopla has reported a 13% increase in sales agreed year-on-year, indicating growing confidence among homeowners to move.

  • The increase in supply has been driven by a rebound in the number of three and four-bedroom homes for sale, as existing owners feel more confident about moving after the initial shock of rising mortgage rates.

  • Zoopla indicates that the announcement of the upcoming general election in July will likely slow the pace of new sales agreements temporarily, but the overall market stability should remain intact.

  • The lack of significant policy differences between the major political parties suggests that major disruptions in the housing market are unlikely due to the election.

  • Executive director at Zoopla, Richard Donnell, has said, “The growth in the supply of homes for sale is evidence of renewed confidence amongst homeowners, some of whom delayed moving decisions in 2023. The quarterly rate of house price inflation has picked up in recent months as more sales are agreed and prices firm.”

UK Investing

UK Equity Fund Outflows and Market Dynamics

  • In May, total UK equity fund inflows dropped to £775 million, two-thirds lower than the January-April average. This decline followed a very strong start to 2024, which saw record inflows of £8.9 billion.

  • The FTSE 100 set seven record closing prices in May, driven by optimism over potential interest rate cuts. However, the index retraced later in the month, contributing to the outflow of funds.

  • Profit-taking after a record-setting FTSE 100 rally led to £1.11 billion in outflows from UK funds.

  • The sharp outflows from UK funds pose challenges for policymakers and regulators who aim to attract more investment into the London Stock Exchange. Both major political parties are focusing on revitalising the capital markets ahead of the general election on 4 July.

  • Glyn remarked, “While buoyant markets usually attract new capital, many investors have seemingly chosen the UK rally as an opportunity to jump ship rather than a moment to reappraise the UK’s prospects.”

  • Despite these outflows, opportunities for investing in individual UK companies remain promising, particularly through tax-efficient schemes like the EIS (Enterprise Investment Scheme) and SEIS (Seed Enterprise Investment Scheme).

  • These schemes offer significant tax reliefs that help offset risks, making them an attractive option for investors looking to support early-stage companies. By Investing in individual companies through EIS and SEIS also allows investors to be more thorough about their choices, as opposed to investing in funds where decision-making is out of their hands.

Global Economy

Russia is Now the 4th Largest Economy in The World

  • Russia has ascended to become the 4th largest global economy by purchasing power parity (PPP), joining China and India in the top five, according to the World Bank.

  • This ascent underscores the increasing influence of BRICS nations and signals a shift towards a more multipolar world economy. The BRICS alliance is no longer a mere coalition of emerging economies but a formidable economic bloc.

  • The BRICS group has expanded its membership, welcoming the UAE, Iran, Egypt, and Ethiopia which has further strengthened the alliance's economic power.

  • Russia's economic momentum enabled it to surpass Germany last year. Consequently, Germany has now fallen to the sixth position globally.

  • Looking ahead, projections indicate that India could emerge as one of the world’s dominant economies by 2028. If these projections hold true, India’s rise could potentially reshape the global economic landscape, reinforcing the trend towards a multipolar world.

Final Note

As we round off this week’s diverse range of topics, spanning global economic shifts to the UK property market, the rise of Monzo stands out. 

Their remarkable journey from inception to profitability not only highlights the fertile ground for innovation within the UK, but also underscores the nation's capacity to nurture and support entrepreneurial ventures. 

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.