RISK WARNING

Simple Crowdfunding is a trading name for both Focus 2020 Limited and Simple Property Ltd. Focus 2020 Limited (FRN 727214) is authorised and regulated by the Financial Conduct Authority. Simple Property Ltd (FRN 747022) is an appointed representative of Share In Ltd (FRN 603332), authorised and regulated by the Financial Conduct Authority.

Simple Crowdfunding does not, expressly or impliedly, directly or indirectly, guarantee or make any representation or warranty concerning the completeness, adequacy or accuracy of this risk disclosures notice. This brief statement does not disclose all of the risks and other significant aspects of investing. You should, therefore, carefully study and consider the merits and demerits and take independent professional advice before becoming involved in investment transactions. You should undertake transactions only if you understand the nature of the contractual relationship into which you are entering and the extent of your exposure to risk, keeping in mind your financial resources.

A decision to invest is a personal decision by you and that no responsibility for the consequences of that decision is accepted by Simple Crowdfunding or by any of its directors, agents, employees or other members.

To invest through Simple Crowdfunding you need to understand the following:

APPROPRIATENESS

Before opening an account for you, we are required to make an assessment whether it is appropriate for you, and to warn you, on the basis of the information you provide to us, whether the services offered by us are appropriate for you. Any decision whether or not to open an account, and on whether or not you understand the risks, is yours.

FEES AND CHARGES

Our costs and charges will be provided to you or set out on our website. Please be aware of all costs and charges that apply to you or the Fundraisers, because such costs and charges will affect your return on investment.

LOSING ALL OF YOUR INVESTMENT

Investment, whether in new or existing businesses, carries high risks as well as the possibility of high rewards. Accordingly each investor should consider very carefully whether such investments are suitable in the light of personal circumstances and commitments and the financial resources available to each Investor. Simple Crowdfunding does not promise any return on investment nor that the value of any investment be maintained. Engaging in any investment activity may expose you to a significant risk of losing all of your investment.

Most of the Fundraising companies that are listed on Simple Crowdfunding are new companies with a limited track record. These companies will provide information such as their business plan and financial forecasts. Please be warned that these documents are not guarantees that the relevant company can achieve what it is hoping to do. Equally the information provided may state certain facts and statements, and again please be warned that Simple Crowdfunding is not responsible for checking the accuracy of these facts and statements (which may not always prove to be true or complete).

If a company you invest in fails, neither the company – nor Simple Crowdfunding – will pay back your investment.

THE NEED FOR DIVERSIFICATION - NOT PUTTING YOUR EGGS IN ONE BASKET

Due to the risks noted above, we strongly recommend that investors spread the money they are putting into crowdfunding across a broad range of opportunities. Doing this will reduce the effect of any individual investment under-performing or failing and should therefore reduce your overall risk of financial loss.

The advantages of diversification also apply to the range of investments you choose and where you invest with members of your immediate family - you should only place a proportion of your funds into crowdfunding and, as a family, aim for a broad spread of different investments between you.

WARNING

Prospective investors should note that past performance should not be seen as an indication of future performance. The value of an investment and the income from it can fall as well as rise and Investors may not get back the amount originally invested. Therefore you should only make investment in unlisted companies or with individuals which you can afford to lose without having any significant impact on your overall financial position or commitments. Taxation levels, bases and reliefs may change if the law changes and independent advice should be sought. We will not have any liability for any legal, investment or tax issues in connection with any investment you decide to make through our platform or from the information we have provided you.

EQUITY SPECIFIC

NO ESTABLISHED MARKET - LACK OF LIQUIDITY

As an investor you should be aware that no established market exists for the trading of shares in private companies (which the companies that are listed on the Simple Crowdfunding platform are), and such shares are not easily realisable. There may also be a restriction on the ability to sell your shares set out in any Shareholder Agreement effected as part of the fundraise. It must be appreciated that there could be difficulty in selling such investments at a reasonable price and, in some circumstances, it may be difficult to sell them at any price.

LACK OF DIVIDENDS

The companies raising funds on Simple Crowdfunding are early stage companies, and these companies will rarely pay dividends to their investors. This means that you may not see a return on your investment until you are able to sell your shares. Profits are generally re-invested into the company to fund growth. Companies have no obligation to pay shareholder dividends.

POSSIBILITY OF DILUTION

Companies who raise funds through Simple Crowdfunding typically offer Ordinary Shares, which include pre-emption rights that protect an investor from dilution. Companies must give shareholders the opportunity to buy additional shares during a subsequent fundraising round so that they can maintain or preserve their shareholding. Dilution affects shareholders who do not buy any of the new shares being issued. As a result an existing shareholder's proportionate shareholding of the company is reduced, or ‘diluted’. This has can have an effect on a number of things, including voting, dividends and value of shareholding.

PEER TO PEER LENDING SPECIFIC

NO ADVICE

We do not provide any advice related to lending decisions you make. While Simple Crowdfunding will carry out basic due diligence on the key persons involved with the project and carry out a risk assessment for the purposes of determining the loan price (interest rate) any decisions made to lend must be yours based on your own assessment of risk associated with the loan you choose.

• The Fundraisers listed on our website are private Businesses. When considering investing, you must take into account the risks inherent in the transaction.
• By lending through Simple Crowdfunding, your capital is at risk and there is a risk that you may not get back what you put in. You should not invest more money through the platform than you can afford to lose without altering your standard of living. Investing through Simple Crowdfunding is not covered by the Financial Services Compensation Scheme. Before it is invested or once the proceeds of investments are returned, your money will be held by the money recipient in a client account and subject to separate protections applicable to credit institutions and banks.
• Using our website you can make loans to unlisted companies which may be start-up or newly formed entities in the SME sector looking for funding to either support their operations or start a new project or in process of launching new product. With no proven track record, your loan may be at a risk of losing significant value.
• Due to nature of the investment, once the loan has commenced and until it is completed, you will be unable to cancel your loan or ask for the return of your capital.
• Where you are considering lending to an unlisted company (whether newly formed or well established), bear in mind the risk that the Fundraiser may be unable to meet its repayment obligations.
• In the event any form of security is offered to the Investor for the loan (such as a charge on a property or a company debenture), Investors should understand that the value of any security provided may change and there is no guarantee that any secured assets can either be disposed quickly or that when disposed will cover all amounts due. Money which is lent to a Fundraiser may be unsecured. Therefore, in case of failure of the Fundraiser to repay the debt, the Investor will rank equally with all other unsecured creditors.
• Loans made to unlisted companies are not readily realisable, unlike investments in listed companies where a readily available secondary market exists. Therefore before making any lending decisions you should assess your future financial needs as you may not be able to find an immediate buyer for your loan.
• When lending money to a Fundraiser, neither the Investor nor Simple Crowdfunding will have control over the day to day operations of the Fundraiser.
• At the time of lending to any business or individual, you should review the financial projections prepared by Fundraiser. We do not provide any advice to Fundraisers and they are solely responsible for the information provided in documents distributed by us. Where possible Simple Crowdfunding will provide updates on the financial position and project status or other relevant information related to the Fundraiser’s businesses however this will be dependent on receiving the same from the Fundraiser. Because unlisted companies have minimal statutory obligations to publish their financial information, we cannot guarantee we will be able to update you with the desired information.
• At the time of making any loan you can review the Investor’s terms and conditions and the Loan Agreement and associated documents. We urge you to read these terms and conditions carefully and seek independent legal advice on their meaning and effect. We will not be liable to you for any failure by the Borrower to honour rights attaching to loans.
• A listed company is required to comply with strict corporate governance and disclosure requirements as stipulated by the Exchanges on which their securities are listed or other regulations. However, in the case of an unlisted company, there are no statutory requirements to make any disclosure in case of any change in control or significant change in operational activities. We cannot guarantee and therefore will not be liable to you for any failure to keep you informed of any such matters.
• Investors should consider whether the Fundraiser’s application sufficiently describes the various risks and conflicts of interest relating to the applicant business, the application and Fundraiser’s operations. Although we will provide guidance to businesses and individuals to assist them in preparing full and fair disclosure of all risks in their application, we have no ability to assess whether all such risks have been accurately described or disclosed and will not have any responsibility for any failure to do so. Before making any investment or lending decisions, you should fully assess the risks involved and should query any matters where you feel inadequate risk disclosures have been made.