Investing into a small company on a crowdfunding platform means 3 key things:
1) You are supporting an independent company, with a team who you will hear from and know;
2) You are investing alongside others in a similar position. 97% of our investors are individuals just like you or me, who have decided to use their funds to support a small company via shares, crowd bonds or digitalised securities;
3) Many small investments can make a BIG difference.
Alongside this, as a participant, you can help support the business and be part of their 'Crowd'.
No, we do not charge investors any fees for investing.
As with most forms of investment, there is risk to your capital. Crowd for Angels does seek to reduce this risk by taking security on every crowd bond, seeking SEIS/EIS tax relief for our share pitches and offering a discounted digitalised security price.
Furthermore, we employ 3 phases of due diligence before any company can list on our platform. We only accept 8% of companies that apply for funding in order to put our investors in the best possible situation to succeed. Read more about our due diligence here.
Companies can fail for a number of reasons and whilst we do take steps to mitigate this, investors should only invest what they can afford to lose and when investing, it is best practice to Invest your money in a number of different investments opportunities for a diversified portfolio.
Historically, investing in small companies has always carried a high degree of risk because many of them fail. Spreading your investments among a variety of companies gives you a higher chance of picking a winner and gaining profit from your overall investments. Diversification prevents you from putting all your money into one company/industry/sector, which eliminates risk for the investor.
Crowd for Angels (UK) limited (company number: 03064807) is authorised and regulated by the Financial Conduct Authority. Our reference number is 176508.
Your investment is not completed until the company has raised at least its minimum funding target. When you make your investment, the committed funds are held securely in a UK bank account. Once the funding target is raised, the committed funds represent the investment amount and are transferred to the company from the bank account. You then become a beneficial shareholder subject to a nominee arrangement. If the minimum funding target is not met, your committed funds will be returned to your Crowd for Angels account.
You can find out more about investing here: crowdforangels.com/investors
At Crowd for Angels the minimum investment is £25. However, companies can specify a higher amount they are willing to accept. The maximum, however, is solely determined by the company’s funding target. The maximum can be met by a sole investor.
This is a decision made by companies on an individual basis. Certain companies prefer to have fewer investors investing larger amounts and so they choose to increase the minimum investment threshold. Furthermore, some companies share price is inhibitive of the minimum investment of £25.
This is not possible. Once the pitch is fully funded to the maximum funding target, it will automatically close allowing for no additional funding to be committed.
There are three ways of making a payment when making an investment at Crowd for Angels:
You can use a Visa, Mastercard or Maestro debit card to pay for the investments. This must be linked to a GBP bank account
By transferring in funds from your bank account to your Crowd for Angels account.
You can pay in CryptoCurrencies, such as Bitcoin (BTC), Ethereum (ETH) and DASH
No, we do not share this information except with the company who you have invested in.
Your investments will be held in the name of a nominee appointed by Crowd for Angels. The company will deal directly with Crowd for Angels who will be the conduit for passing information and for handling distributions to Crowd for Angels investors.
Yes. If you have committed funds or you are following a pitch you will be an informed by an automatic email when a company has reached its minimum and maximum funding target.
You can cancel your payment at any time up until the minimum funding target is reached. After the minimum funding target is reached you can cancel your payment at any time up to seven (7) days. If the maximum funding target is reached, you can cancel a payment at any time up to seven (7) days. Where the maximum funding target is not reached during the remainder of the pitch, you can cancel your payment up to seven (7) days after the expiry of the pitch.
Yes, however, people located in territories other than the UK should consult their professional advisors to ensure any investment is compliant under their local laws and jurisdictions before they invest in any pitch on the Crowd for Angels platform. Those residing in the United States are not eligible to invest on this platform.
No, Crowd for Angels is a crowdfunding company. While there are several similarities between crowdfunding and peer to peer lending, Crowd for Angels' investors put money into equity, crowd bonds and digitalised securities as opposed to just loans in the case of peer to peer.
During the funding period, investors at Crowd for Angels commit to invest but are not deemed to have invested until the funding target is reached. Until that date, these amounts are shown as 'committed funds' in your Crowd for Angels account. Once the minimum funding target is reached, your committed funds will be referred to as investments and will be named 'my investments' in your Crowd for Angels account.
While we are committed to bringing investors at Crowd for Angels the best possible pitches we do not personally advise investors on any investments. Crowd for Angels does not recommend or endorse any companies.
Any information provided by a company will be reviewed by Crowd for Angels and where appropriate we will ask for documents to support the data submitted. However, investors at Crowd for Angels should rely on their own judgement, knowledge and expertise to decide if the company will be a success or not.
Investors at Crowd for Angels can also benefit from their ability to connect with the company and other potential investors on the Crowd for Angels platform. This process of taking into account the collective opinion of a group of individuals rather than a single expert to answer a question is known as the "wisdom of the crowd". This is a useful tool for investors at Crowd for Angels looking to do their due diligence.
You can read more about our due diligence here: https://crowdforangels.com/pdf/Due-Diligence-we-carry-out.pdf
You must become a member on the Crowd for Angels platform to access and to be authorised to invest. Furthermore, you must self-certify that:
(a) You are a Sophisticated Investor (either on behalf of yourself as an individual investor or on behalf of a legal entity as an Institutional Investor); or,
(b) You are a certified High Net Worth Individual; or,
(c) You will not invest more than 10% of your net investible portfolio in unlisted shares or loan notes (excluding your primary residence, pensions and life cover).
Yes, investors should be paid their investment back once a Crowd Bond has matured (reached its term). However, if the company is late in making repayment then the repayment date might be after the maturity date, once the bond has been repaid/recovered in full.
Client money is held on behalf of investors, by the nominee, Thomas Grant & Company Limited in a third party segregated bank account with a Lloyds Bank PLC. This ensures client funds are not 'mixed' with those funds of Crowd for Angels (UK) Limited "The Company".
A segregated bank account is meant to hold a customer's funds separately from a company's funds in the interests of the customer's security. This ensures that we can only move money from this account on your instruction. Furthermore, if Crowd for Angels becomes insolvent, your money (including any committed funds) will be safe and creditors do not have claims to it.
Crowd for Angels employ Thomas Grant & Company Nominees Limited (company number 02834389) a subsidiary of Thomas Grant & Company Limited to act on behalf of investors
Thomas Grant & Company Limited was established in 1993 and has over 25 years of experience as a traditional stockbroker. Their offices are located at 40a Friar Lane, Leicester, Leicestershire, LE1 5RA and Company No.02788515 which is regulates and authorised by the CFA to hold client monies (163296).
The 'wisdom of the crowd' is the process of taking into account the collective opinion of a group of individuals rather than a single expert to answer questions. This is a useful tool for investors at Crowd for Angels in carrying out their own due diligence by monitoring the conversations, seeking answers to your own queries from the crowd and following the on-going fundraising process. The Crowd for Angels discussion board available on each pitch page is a useful tool.
You can contact the company simply by going to the company’s discussion board on the pitch and ask your question. You might be able to find answers to some of your questions already posted on the same discussion board.
Each company sets its minimum funding target and maximum funding target. When a company reaches its minimum funding target, it can collect the funds raised. However, if it fails to reach this funding target, the committed funds will be returned to the investors' Crowd for Angels accounts. Companies also set the maximum funding targets so that they can raise more funds to expand their business more quickly. However, companies are required to justify the use of the funds as set out in the maximum funding target. If an investor at Crowd for Angels would like to see a company succeed, it is preferable to invest in the minimum funding target.
Directors of private companies will have to indicate how they intend to realise your investments.
Regarding equity funding this will to a large extent determine the length of time you will need to hold your shares. In any event, to take advantage of the SEIS/EIS tax relief you will need to hold your shares for about three years.
With regards to debt funding companies issue loan notes which have a defined interest rate payable on the repayment date. Depending on the loan type you will have different options when it comes to realising your investments. Many of our loans are designed to have less than two years with interest payments. Concerning convertible loan notes you have the opportunity to convert these into shares and eventually sell these, however, this is not compulsory. With no conversion you can instead receive the principal sum plus the accrued interest upon the repayment date i.e. upon maturity.
Investments in private companies
Once the fundraising process is complete and the legal paperwork prepared, your shares will be sent to your nominee. The nominee will manage your investments on your behalf while you can still receive the full economic interest in the business. In case the company is sold or listed on a stock exchange, we will distribute all the financial benefits of these transactions.
Investments in public companies
The investment amount you invested in will start accruing interest once the legal paperwork has been completed. With regards to convertible loan notes the term is 360 days and investors at Crowd for Angels will receive a payment constituting their principal sum and interest. As an investor at Crowd for Angels you will have the option to convert your investment into shares if you wish to do so. There will be two dates at which you can convert the invested amount (or only part of it) and the conversion price will be made available to you on the close of business on this day.
If the company you invested in is taken over by another company, we will deposit the proceeds from the sale of your shares in to your Crowd for Angels account.
Our general recommendation to investors at Crowd for Angels would be to spread your investments between a number of companies. Investing in companies carries a lot of risks as many of these, historically, fail and therefore, diversifying your investments will be an essential prerequisite in benefiting from such investments. Nevertheless, it is important to note that we do not advise investors at Crowd for Angels on how much they should invest and nor in which companies.
Some companies give not only shares, loan notes, or tokens in return for investments but also rewards. The nature of these rewards is determined by the company. Normally, there are thresholds set in respect of the amount to be invested to receive a specific reward. For more information about rewards, please look at the company’s pitch on the right-hand side (just below the info panel). Please note that it is entirely up to the company whether it wishes to give rewards or not.
In the event that we cease to trade, any money in Your CfA Account will be protected. You will have a specified period of time in which to withdraw any money in Your CfA Account, after which time we will send a cheque or money order for such money to the address in Your CfA Profile.
Meanwhile, your investment will continue to be handled as set forth in the relevant Investment Agreements and Nominee Terms.
We will seek to appoint an Administrator who will act on behalf of clients and deal with any client money and asset queries. In the event that Crowd for Angels is unable to find an alternative IF-ISA Manager, income and returns from any investments held within an IF-ISA may lose their tax free status. In the event of Crowd for Angels ceasing to trade, your client status is likely to change.>
The convertible loan note prescribes conversion dates which the company can decide for itself. If you choose to convert these loan notes into shares, you must submit a “Notice of Intention to Convert” via the means made available on the Crowd for Angels platform. This will serve as an express instruction on the nominee to serve a conversion notice on the company who will then issue the shares. It is important to note that converting your convertible loan notes in to shares is not mandatory. You can keep these loan notes until the repayment date which is 360 days from issue and have your interest and principal sum repaid in full.
The process is simple. A button called 'convert' will appear on your portfolio page on the conversion date. By clicking this button a form called 'Notice of Intention to Convert' will appear which you are required to fill in if you wish to convert your convertible loan notes in to shares. All you have to do is choose how much you would like to convert and click the button to calculate it. The calculations will show the following:
The amount of accrued interest on your convertible loan note
The conversion price
The number of shares you will receive upon choosing to convert
The residue cash balance, if any
If you decide to proceed, please read the 'terms of conversion' and if you agree, tick the box to show your agreement. You then click the 'submit' button. Once the 'Notice of Intention to Convert' is submitted, it will be sent to the nominee who in turn will send a conversion notice to the company who will issue the shares and send them to your nominated brokerage account. Therefore, please remember to fill in the details of your nominated brokerage account.
After you submit your 'Notice of Intention to Convert', we will send it to the nominee who will in turn serve a conversion notice on the company, who will then issue the shares to your nominated brokerage account.
If you decide not to convert, the company is required to repay to you the principal sum and accrued interest on the repayment date. The principal sum and accrued interest will be transferred to your Crowd for Angels account.
A convertible loan is a loan with the ability to convert loan notes into shares at two points within the loan term. For an example of how this works on the Crowd for Angels platform please watch the video below. You can find more information about convertible loans on our dedicated page here.