More about Growth Opportunities

cf-headerMore About Early Stage Growth Companies

What are Early Stage Growth Opportunities?

Early Stage Growth Opportunities are new, entrepreneurial businesses. In some cases they are highly-innovative, working to disrupt an industry and change the way we do things. These tend to be very high-risk, but if they are successful, the rewards can be tremendous.

Others are more traditional ventures in the early stages of becoming operating businesses. These are usually somewhat lower-risk propositions, but the potential for high returns is also lower. And there is a whole range in between, with different ambitions and different risk/reward profiles. 

Most Early Stage Companies Need Development Capital

When an entrepreneur starts a new venture, they usually need seed capital to turn their idea into the beginnings of an actual business. Depending on the business, this capital might allow them to build a minimum viable product, buy machines, lease space, make a key hire and/or acquire inventory.

Once the business becomes more developed and has a proven product with sales then the company will probably then require development capital. 

We are looking for companies that are mainly looking for development capital which is the less risky capital requirement. However we do provide seed capital opportunities as well.

How much money constitutes seed capital – as opposed to later-stage angel or venture capital – varies depending on each business. Due to technological advancements, the costs of starting a business have come down drastically in recent years, and some entrepreneurs find that as little as £25,000 or £50,000 can get them a long way today. Others need a bit more to get off the ground, and some seed rounds may be £150,000 or even more. 

Development capital requirements can again vary from as little as $100,000 upwards.

Early Stage companies as an Asset Class

Like property, quoted shares and gilts, early stage companies are a financial asset class. Most investments in early stage investments – including all investments made through In Crowd – are structured as equity, meaning that investors purchase shares in the company. This means the investor owns a stake in the business, and if it succeeds, the investor can potentially see returns through dividends or gains upon selling the shares.

Investing in early stage companies involves significant risk, and you should only do it if you can afford to lose the capital you invest. But with risk comes potential reward, and historically the overall returns from early stage companies as an asset class have been very strong. 

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