Quintessentially Ventures Risk Warning

1. Loss of Capital

General Crowdfunding

If you invest in a company through the platform, it is possible that you will lose all of your invested capital. Your investment is not guaranteed by QVentures or by the companies themselves, and you should not invest more money through the platform than you can afford to lose without altering your standard of living. Potential investors should note that an investment through QVentures is subject to market fluctuations and there can be no assurance that any appreciation in value will occur.

2. Illiquidity

Any investment you make through the platform will be highly illiquid. There is no active secondary market for the shares of the investee company. This means that you are unlikely to be able to sell your shares until and unless (a) the company floats on a stock exchange, or (b) is acquired by another company or (c) the investee company buys back the securities you purchased. The securities you purchase through the platform are not listed on any exchange.

3. Rarity of Dividends

The businesses presented on QVentures rarely pay dividends. This means that if you invest in shares through the platform, you are unlikely to receive any dividend payouts or to realise any return on your capital until you are able to sell your shares in the investee company. Even for a successful business, this is unlikely to occur for a number of years from the time you make your investment.

4. Diversification

Investing in startups should only be done as part of a diversified portfolio. This means that you should invest relatively small amounts in multiple businesses rather than a lot in one or two businesses. It also means that you should invest only a small proportion of your investable capital in startups as an asset class, with the majority of your investable capital invested in safer, more liquid assets.

5. Tax

Each time you invest, you must satisfy yourself prior to making any commitment that you understand and accept the tax consequences to you of making that particular investment, including the UK and foreign tax treatment of dividends, interest payments and capital gains or losses.

The UK government provides certain types of tax relief for investments in small businesses by UK tax resident individuals. Tax reliefs are not guaranteed and depend on the entities invested in maintaining their qualifying status, and may be withdrawn at any time by HM Revenue & Customs. Tax treatment is dependent on the individual circumstances of each client and may be subject to change in the future.

6. Advice

QVentures does not give investment advice or provide analysis or recommendations regarding investment opportunities. Investments can only be made by members of QVentures on the basis of information provided. QVentures takes no responsibility for this information or for any recommendations, opinions or predictions.

7. Past Performance

Past performance is not a reliable indicator of future results. You should not rely on any past performance as a guarantee of future investment performance.

8. Future performance

Investee companies may provide forward-looking statements with respect to future results. Forward-looking statement are not guarantees of future results or performance and many different factors could cause actual results to be different from those that may be expressed or implied by such forward-looking statements. As such, forecasts are not a reliable indicator of future performance.

9. Financial Services Compensation Scheme

Investing through QVentures is not covered by the Financial Services Compensation Scheme.

10. Dilution

Any equity investment you make through QVentures may be subject to dilution. Dilution occurs when the company in which you invest issues more shares after you invest (for example in follow-on equity fundraising or in connection with employee options) so that your share of ownership of the company declines. These new shares may also have certain preferential rights to dividends, sale proceeds and other matters, and the exercise of these rights may work to your disadvantage.

11. Dependence on the Directors

The success of many investee companies on QVentures will depend in part upon the ability of their directors to develop and maintain a strategy that achieves the company’s investment objectives.

12. Lack of Operating History

Many investee companies on QVentures are recently formed entities and have no substantive operating history upon which prospective investors can evaluate likely performance.

13. Currency exchange rates fluctuate

Investments through QVentures are denominated in pounds sterling, but some investee companies on QVentures operate in foreign countries that use other currencies. The exchange rates between the pound sterling and those foreign currencies will fluctuate over the life of your investment. This means that even if the investee company is successful and the value of your investment increases in terms of the foreign currency, you may not be able to realise the full value of any increase in terms of pound sterling, and you may lose some or all of your investment due solely to exchange rate fluctuations.

14. Client Classification

Before being allowed to invest, you will need to be classified as an investor type. You will need to provide the relevant information to us, which you warrant to be truthful and accurate, in order that we can classify you. Please follow the steps when signing up to complete this process. If you no longer fall into at least one of the categories of investor available, you will give immediate written notice to QVentures and you will not access, or try to access the service unless and until you fall into one or more of these categories again.

15. Jurisdiction

The information and services provided on the Site are not provided to, and may not be used by, any person or entity in any jurisdiction where the provision or use thereof would be contrary to applicable laws, rules or regulations of any governmental authority or where QVentures is not authorised to provide such information or services. Some products and services described in the Site may not be available in all jurisdictions or to all clients.

This list of risk factors does not necessarily outline all possible risks involved. Prospective investors should read the relevant investee companies’ pitch documents and the QVentures lender terms in their entirety and consult with their own advisers before deciding whether to invest. If you are unsure about any aspect of the information provided by the company, you should seek advice from an independent financial adviser.