Policies

Crowdbase Risk Warnings

Introduction

Investing through Crowdbase Ltd involves significant risks, and investors should carefully assess whether crowdfunding investments are suitable for them.

Crowdfunding investments are high-risk and illiquid, and investors should be prepared to lose all the money invested.

This document provides an overview of the main risks associated with investments on the Crowdbase platform. However, it does not and cannot disclose or explain all risks involved. Investors should conduct their own due diligence and seek independent financial advice before making an investment decision.

1. General Investment Risks

Loss of Capital

Investing in early-stage companies, startups, or real estate projects through Crowdbase carries a high risk of losing some or all of the invested capital. Unlike bank deposits or fixed-income securities, there is no guarantee of returns, dividends, or capital repayment.

Illiquidity & Transferability Risk

Securities offered through the Crowdbase platform are not listed on a stock exchange. Investors may find it difficult or impossible to sell or transfer their investment, as there may be no active secondary market. Investors should be prepared to hold their investment for the entire duration of the project.

Lack of Investor Compensation Schemes

Investments made via Crowdbase are not protected by any investor compensation scheme or deposit guarantee scheme. Investors cannot rely on regulatory protection schemes in case of failure or losses.

Dilution Risk

If a company issues additional shares in the future, existing investors’ ownership percentage may be reduced (diluted). This can affect an investor’s ability to receive dividends or participate in decision-making.

Risk of No Dividends or Profit Distribution

Not all companies pay dividends. Even if a company generates profits, it is not obligated to distribute them to investors. Investors should consider that they may only make a return if the company is sold or goes public.

2. Risks for Non-Sophisticated Investors

Non-Sophisticated Investors receive additional protections, but they must be aware of the following:

Reflection Period

  • Non-Sophisticated Investors have a four-day reflection period, during which they can cancel an investment commitment without penalty.

Knowledge Assessment & Risk Warnings

  • Investors must complete an Entry Knowledge Test to determine their understanding of crowdfunding investments.
  • Investors may receive additional risk warnings if an investment exceeds 5% of their net wealth or is deemed high-risk based on campaign-specific factors.

3. Specific Risks for Equity Investments

Market Risk & Valuation Uncertainty

  • The value of shares in startups, private companies, and real estate projects is highly volatile and depends on market conditions.
  • There is no certainty that shares will increase in value.

Issuer Risk & Business Failure

  • Companies raising funds on Crowdbase are often early-stage ventures with limited operating history.
  • There is a high risk of business failure, and investors may lose all their money if the company becomes insolvent.

Exit Risk & Lack of Liquidity

  • Unlike listed stocks, shares in private companies are not publicly tradable.
  • Finding a buyer for shares in a private company can be extremely difficult.

4. Risks for Real Estate Crowdfunding

Market Risk & Property Value Fluctuations

  • The value of real estate assets can fluctuate due to economic downturns, interest rate changes, or regulatory factors.

Liquidity Risk

  • Real estate investments are highly illiquid, and selling a property or shares in a real estate SPV may take years.

Rental Income & Profitability Risk

  • There is no guarantee that a property will generate the expected rental income.
  • Real estate projects may experience delays, increased costs, or unexpected maintenance expenses.

5. Crowdbase's Role & Investor Responsibility

Crowdbase Does Not Provide Investment Advice

Crowdbase is a neutral crowdfunding platform and does not provide investment recommendations. Investors are responsible for assessing their own risk tolerance and making informed investment decisions.

Investors Must Conduct Their Own Due Diligence

Crowdbase performs basic screening on projects, but investors should conduct their own independent analysis before investing.

Changes in Regulation & Taxation

  • Changes in government regulations, tax laws, or financial regulations may impact investment returns.
  • Investors should consult tax advisors regarding potential tax liabilities on capital gains, dividends, or interest income.

6. Final Disclaimer

Investing in crowdfunding projects carries significant risks. By investing through Crowdbase, investors confirm that they:

✅ Understand and accept the risks outlined in this document.
✅ Acknowledge that they may lose all their invested capital.
✅ Understand that Crowdbase does not provide guarantees, compensation, or buyback options.

This risk notice is provided in accordance with Regulation (EU) 2020/1503. Investors should seek independent advice before making any investment decisions.