Don’t invest unless you’re prepared to lose the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong. Take 2 mins to learn more.

Risk Warning: Investing in Crowdfunding Projects 

Investing in crowdfunded projects and opportunities can be an appealing option, but it also carries significant risks. Here are important considerations to keep in mind: 

  1. High Failure Rate 

    • Approximately 20% of start-ups fail within the first year. 
  • Nearly 50% of start-ups do not survive beyond five years. 

  1. Liquidity Risk 

    • Crowdfunding investments are often illiquid; you may not be able to access your capital quickly. 

  1. Volatility 

    • Investment values can fluctuate widely based on market conditions and company performance. 

  • Projects may experience drastic valuation changes with funding rounds or major announcements. 

  1. Limited Historical Data 

    • New projects offered through crowdfunding opportunities often lack proven performance records, making it difficult to predict future success. 

  1. Potential for Loss 

    • Investors could lose a substantial portion, if not all, of their capital in poorly performing crowdfunded opportunities. 

  • Investment strategies should always consider potential worst-case scenarios. 

  1. Due Diligence Required 

    • Thorough research and analysis are essential before investing in any crowdfunding project. 

  • Consider evaluating business models, management teams, and market conditions. 

  1. Regulatory Risks 

    • Compliance with regulations can change, potentially impacting investment security and returns. 

  • Be aware of legal and regulatory frameworks governing these projects. 

  1. Diversification Strategy 

    • To mitigate risks, consider diversifying your portfolio across different asset classes and industries. 

  • Avoid putting all your capital into one crowdfunding opportunity. 

By understanding these risks and considerations, potential investors can make informed decisions when contemplating investments in crowdfunding opportunities. Always assess your risk tolerance and investment goals before proceeding. 

Risk Warning

The information provided on this website should not be considered a recommendation to participate in securities-based crowdfunding. If you’re interested in knowing more about securities-based crowdfunding, visit CMA's website for more details on the details of crowdfunding.

Please seek independent advice as required as iMowazi does not give investment advice.

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At iMowazi, we are a neutral facilitator committed to innovation in the crowdfunding space. We do not endorse any particular crowdfunding opportunity or project, nor do we provide support for company growth or development. Instead, we offer a marketplace where companies can showcase their funding needs, and investors can explore a range of options, from high-risk ventures to more conservative opportunities. 
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