All persons who register as an investor on LEOcrowdfunding Ltd ("LEOcrowdfunding") should read the following warnings carefully before making any investment. All investment products carry risks. The information provided on specific investment opportunities will cover risks specific to each specific investment opportunity. You should note that the risks described below are not intended to be exhaustive. You should carefully familiarise yourself with each of the risks associated with any particular investment and to properly assess whether investing is appropriate in your own circumstances.
1. Your personal decision to invest
A decision to invest is a personal investment decision by you and no responsibility for the consequences of that decision is accepted by LEOcrowdfunding or by any of its directors, agents, employees or other members.
2. Losing all of your investment
Investment, whether in new or existing companies, carries high risks as well as the possibility of high rewards. If the business you invest in fails, you are likely to lose 100% of the money you invested. You should only invest an amount you are willing to lose and should build a diversified portfolio to spread risk. If a company you invest in fails, neither the company – nor LEOcrowdfunding – will pay back your investment. Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA regulated firm, FOS may be able to consider it. Learn more about FOS protection here. 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.
3. Lack of liquidity
Liquidity is the ease with which you can sell your investments after you have purchased them. As an investor, you should be aware that no established market or exchange exist for the trading of these investments. Even if the business you invest in is successful, it may take several years to get your money back. You are unlikely to be able to sell your investment early. Investments through LEOcrowdfunding should be viewed as long term and illiquid investments.
4. Investing in shares/equity – lack of dividends
Dividends are payments made by a company to its shareholders from the company’s profits. Investing in shares, also known as equity, on LEOcrowdfunding does not involve a regular return on your investment, even though you are a shareholder of the company. 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.
5. The need for diversification
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. [https://www.fca.org.uk/investsmart/5- questions-ask-you-invest] You should also consider avoiding putting your money in the same investment as immediate family members. Please note that diversification does not assure a profit or provide a guarantee against investment loss.
LEOcrowdfunding does not give investment advice or provide analysis or recommendations regarding investment opportunities. Investments can only be made by users of LEOcrowdfunding website on the basis of information provided. LEOcrowdfunding takes no responsibility for this information or for any recommendations, opinions or predictions. You should seek your own independent legal and financial advice.