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: 19 October 2022
Estimated reading time: 2 minutes
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. https://www.fscs.org.uk/what-we-cover/investments/
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. https://www.financial-ombudsman.org.uk/consumers
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. https://www.fca.org.uk/investsmart/5-questions-ask-you-invest
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. https://www.fca.org.uk/investsmart
Please find the PDF version here.
An Investor’s Guide to EIS and Capital Gains Tax
A guide for investors to understand how they can utilise the Enterprise Investment Scheme to take advantage of Capital Gains Tax (CGT) relief.
Why we produced the EIS & GCT Guide
The use of the Enterprise Investment Scheme (EIS) to defer Capital Gains Tax liabilities, potentially forever, is often overlooked by financial planners and many investors. With many EIS Managers demonstrating that they can deliver attractive returns from EIS investments, as well as the range of tax benefits that they offer. We believe it is an attractive and under-utilised option for investors.
CGT benefits in practice
To demonstrate how investors can benefit from Capital Gains Tax Reinvestment Relief and Capital Gain Tax Exemption we have developed a short guide, showing how it can work in practice. As we hope you will see, the results on the value of your investment portfolio can be significant.
An Investor’s Guide to EIS and Capital Gains Tax
Please fill in the form below and we will email you a copy of the guide
How can I invest?
Take advantage of the tax advantages available to SEIS and EIS investors through the Nova Cofoundery SEIS and EIS fund. Register and qualify to invest in under 5 minutes.
Please read our full risk warning and disclaimer: https://invest.novagrowthcapital.co.uk/risk
Investments of this nature carry risks to your capital. The risks include illiquidity where shares may not be able to be sold easily, lack of dividends and dilution. Past performance is not indicative of future returns. Investors should only invest a proportion of their available investment funds into Nova Cofoundery SEIS & EIS Fund as these investments are high risk.
The availability of any tax relief, including EIS and SEIS, depends on the individual circumstances of each investor and of the company concerned, is only available for UK investors in qualifying companies and may be subject to change in the future. If you are in any doubt about the availability of any tax reliefs, or the tax treatment of your investment, you should obtain independent tax advice before proceeding with your investment.
Nova Growth Capital Limited is a private limited company registered in England and Wales (Company Number 11591402). Nova Growth Capital Limited (FRN 826519) is an Appointed Representative of Sapphire Capital Partners LLP (FRN 565716), who are authorised and regulated by the Financial Conduct Authority.
FUND INVESTMENT FEES
5% initial fees and 2% annual fees paid by the Fund Investee Companies, resulting in 100% allocation of investment for tax reliefs with no additional fees. 20% performance fee only once on original investments that return over 150%.
Registered address: Nova Growth Capital, 57 Jordan Street, Liverpool, Merseyside, England, L1 0BW
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