Don’t invest unless you’re prepared to lose all your money.

These are high-risk investments and you are unlikely to be protected if something goes wrong.

Risk summary for non-readily realisable securities which are shares:

Last updated: 15 April 2024 | 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?

1. You could lose all the money you invest

If the business you invest in fails, you are likely to lose 100% of the money you invested. Most start-up businesses fail.

2. You are unlikely to be protected if something goes wrong

The business offering this investment is not regulated by the FCA. Protection from the Financial Services Compensation Scheme (FSCS) only considers claims against failed regulated firms. Learn more about FSCS protection here.

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.

3. You won’t get your money back quickly

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. 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. If you are investing in a start-up business, you should not expect to get your money back through dividends. Start-up businesses rarely pay these.

4. 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 anyone to do well. A good rule of thumb is not to invest more than 10% of your money in high-risk investments. Read more about it here.

5. The value of your investment can be reduced

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. If you are interested in learning more about how to protect yourself, visit the FCA’s website here.

Please find the PDF version here.

Advisers

The Fuel Ventures funds invest in UK technology companies via a suite of tax-efficient investments that are highly rated by advisers and analysts alike. The SEIS, EIS & VCT funds are currently open.

• Winners of the Best EIS & Best SEIS Manager categories at the Growth Investor awards.

• The Fuel Ventures funds have deployed over £200m of S/EIS and VCT funds to date.

• The funds have had multiple exits, returning £29.5m+ cash to investors.

• The funds are ranked as some of the best performing funds in the market by third party analysts.

• The fund’s thesis focuses on technology companies across marketplaces, platforms and SaaS.

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We help fuel the growth of exceptional tech companies

The Fuel Ventures funds are one of the most active early and growth stage investors in the UK into leading fast growth technology business. The Fuel Ventures funds seek to invest in the most ambitious entrepreneurs in the sectors covering globally scalable marketplaces, platforms and software.

The funds invest in companies at an early stage and work closely with founders providing hands-on support and a collaborative ecosystem.

If you'd like to find out more please call:

+44 20 4586 5295

The Fund Range

Pre-Seed SEIS Fund

Ticket size: up to £250,000

SEIS qualifying

Revenue or pre-revenue

Both lead or follow the round

Post-MVP preferred

Diversified portfolio of 10-30 companies per tranche

Scale-up EIS Fund

Ticket size: £1-3m

EIS qualifying

Revenue Generating Businesses

We can lead rounds

Investing in 10-15 companies per tranche

Follow On EIS Fund

Ticket size: £2-£5m

EIS qualifying

Seed - Series A Capital

Backing strongest performers

Investing in 5-8 companies per tranche

VCT Fund

Ticket size: £500k - £7.5m

30% Income Tax Relief

Highly diversified portfolio

Backing strongest performers

Client planning opportunities

Tax efficient products can help a range of clients with meeting their financial goals. The examples below outline some different scenarios that you may want to consider when advising clients on how to make use of the available tax reliefs.