Since 2011, Crowdcube has funded 1,000 businesses with 6% giving investors a return, 79% are still trading, and 15% are no longer trading.
Research from Beauhurst for The Sunday Telegraph found that of 685 UK crowdfunding raises, completed on 28 crowdfunding platforms including Crowdcube, between 2013 and 2015, some 148 had since stopped trading, equivalent to 21pc. While the failure of any business is disappointing it should be viewed in context, just under 50% of new businesses fail after three years according to figures from the Office for National Statistics, highlighting that the failure rate of crowdfunded startups is much lower than the average startup.
Like any form of investment, there are risks to your capital and crowdfunding investors should be aware that not all businesses will succeed like the businesses that have already delivered investor returns. This highlights the importance of spreading investment risk with a diversified portfolio.
Investors on Crowdcube can be assured that we are committed to ensuring transparency and have rigorous due diligence processes in place, which are spearheaded by an experienced team of legal and compliance professionals. Crowdcube’s investor relations team notify investors if we are informed that a company has gone into administration.
