Your capital is at risk and returns are not guaranteed
When you make an investment on Abundance your capital is at risk. If something goes wrong or if the project or company fails during the life of the investment it may not be able to pay your returns and you may not get back all or any of your original investment.
The sorts of things that could result in a project or company getting into trouble will depend on the particular business but could include:
- Lower than expected revenues
- Higher than expected costs
- Extended operational failure not covered by normal maintenance warranties and contracts
- An extended period of deflation
- Delays or missed deadlines in a project’s timeline
There are also specific risks that relate to each individual investment, so please read the risks section of the Offer Document before you decide to invest.
Each investment is different
All of the investments on Abundance are designed to create something good for the environment and society, and generate a financial return, but each investment has its own return, terms and risks. The length of each investment will vary, with the shortest being 1 year and the longest up to 20 years.
The risks with each investment will depend on the type of project or company. Earlier stage projects, such as construction or development, are typically (although not always) higher risk than businesses that are already up and running. Investments with a higher return are usually correlated with higher risks. You should always make sure you have carefully read through the Offer Document, including the risks section and made sure that particular investment is right for you.
Some investments may be secured depending on the type of project which means assets of the issuer or an associated company may be reserved to cover Abundance investments. However, security does not guarantee repayment and there may be reasons why any assets can’t be realised to pay investors. These include where the market value of the assets concerned is insufficient or the costs of realising them make sale uneconomic.
Selling your investment
The investments on Abundance are transferable which means if you want to get your money back you may be able to sell them but there is no formal regulated market on which you can do so. To help you sell Abundance provides a marketplace which enables buyers and sellers to connect and trade investments, but this is informal and is not like a stock exchange or other regulated market. You may not be able to sell instantly or at all. Remember, if you are forced to sell them in a hurry or if an investment has not paid returns as expected, there is a risk you may not get all of your money back.
Abundance is not authorised to provide financial advice to investors and does not do so. It is therefore your responsibility to do your homework on whether to invest in a specific investment or not. If you do not understand anything regarding a particular investment please seek independent financial advice.
Past and future performance
The past performance of an investment is not a guide to its future performance and should therefore not be relied on when making an investment. This is particularly important if you are buying an investment through the marketplace.
There may be predictions or forecasts as to future performance in Offer Documents. Abundance works with the issuer to make sure (as far as possible) that these are reasonable and are supported by objective data but they may still be affected by risks and other factors. There is no guarantee that any business will succeed or meet its objectives. You should consider carefully any predictions and forecasts in the Offer Document and any detailed risk warnings relating to them.