Risk Warning

Investing in start-up and early stage businesses is high risk.

Before making any investments through Ascentifi Limited or Ascentifi Clients Limited (both hereafter referred to as “Ascentifi”, “we”, or “us”) every investor should be aware of the following:

Unregulated Investments
Your investment is not covered by the deposit guarantee schemes established in accordance with Directive 2014/49/EU of the European Parliament and of the Council. Your investment is not covered by the investor compensation schemes established in accordance with Directive 97/9/EC of the European Parliament and of the Council. Ascentifi and the companies that you can invest in through Ascentifi are not regulated by any Financial Regulatory Authority. This means that when a business fails, the most probable outcome is loss of all, or part, of your investment.

Loss of investment
Most start-ups fail, therefore it is very risky to invest in these businesses. The most probable outcome from any one investment is loss of all, or part, of your investment. This means that as an investor, you should only invest an amount that you are willing to lose and that you can affoard to lose, and you should have sufficient funds set aside to build a diversified portfolio so that you can mitigate some of the risk. If a business you invest in fails, neither the company, nor Ascentifi is obliged to pay you back any of your investment.

Illiquid Investments
Any investment you make through Ascentifi will be highly illiquid. There is no secondary market for the shares of the companies that Ascentifi presents as investment proposals. This means you are unlikely to be able to sell your shares until and unless the company you invested in is bought by another company or floats on a securities exchange. Both events are highly unlikely to occur for a number of years from the time you make your investment, and your investment capital will be unavailable to you for that period.

No Dividends
Dividends are payments made by a business to its shareholders from the company’s profits.  Start-up and early-stage companies extremely are rarely in profit and rarely pay dividends. Any profits are typically re-invested into the business to fuel growth and build shareholder value. This means that if you invest in a business through Ascentifi, even if it is successful, you are unlikely to see any return of capital or profit until you are able to sell your shares in the company.

Shareholder Dilution
Dilution occurs when a company raises additional capital by issuing new shares. This means that if you own shares in a company and this company issues new shares that are purchased by new investors, the percentage of the company that you own will decline. Additionally, these new shares may have preferential rights attached to them that will rank them above existing shares. Examples of preferential rights are entitlements to dividends, or entitlements to be paid first from any sale proceeds. The exercise of these rights may work to your disadvantage. Your investment may also be subject to dilution due to the granting of share options (or similar instruments to acquire shares) to employees, service providers or other third parties connected with the company.

Diversification is a strategy of spreading your money across multiple investments to reduce risk. Investing in startups should only be done as part of a diversified portfolio. This means that you should invest small amounts in multiple early-stage companies rather than a lot in one or two companies. Investors should only invest a small proportion of their available investment funds in early stage companies and should balance this with safer and more liquid investments.