Seedrs.com is the only crowdfunding site authorized and regulated by the FSA – who have already issued a warning to inexperienced investors regarding the potential risks of using crowdfunding sites.
Yesterday, I was offered a promotion whereby I was given £100 to invest in start ups listed on Seedrs – needless to say I accepted.
To access this promotion, I had to sign up to the Seedrs website, and I was pleasantly surprised by my experience.
There is a lot written in the media about the risks of investing through crowdfunding sites and the fact that inexperienced investors may throw away their money without realizing it – not at Seedrs!
The first part of the registration process was for me to disclose information about myself: My name, age, profession and job title…etc.
The website then decided that as I had not invested into a business in the past, they would need for me to demonstrate my knowledge of the risks and rewards of equity investment before they would allow me to sign up.
To do this, I had to answer a series of multiple choice questions about equity investment (and had to get 100% correct to be eligible to invest). The questions ensured that I was aware of all of the risks of equity investment.
Once I had completed the test (which you can only take once), thankfully, I was deemed capable to make an investment.
So what have I learnt from this experience? I can safely say that everybody that uses Seedrs should be fully aware of the risks they are taking on.