Investing in early-stage, growth-stage and private market opportunities involves substantial risk. You may lose your entire investment. These investments are not suitable for all investors. Past performance is not indicative of future performance. Returns are not guaranteed.
This Risk Disclosure Statement ("Statement") is provided by Vestinit Ventures Australia Pty Ltd ACN 123 456 789 ("Vestinit") and describes the principal risks associated with investing in private companies, special purpose vehicles (SPVs), convertible notes, SAFE instruments and other early-stage or growth-stage investment opportunities that may be presented through the Platform.
This Statement does not purport to describe every risk applicable to every investment. The specific risks applicable to each opportunity are described in the deal materials for that opportunity. You should read all deal materials carefully before making any investment decision.
This Statement is general information only. It is not financial product advice, personal advice or a recommendation to invest. You should obtain independent financial, legal and taxation advice before making any investment decision.
Private market and early-stage investments are high risk. The businesses or projects in which you invest may fail entirely. In such circumstances, you may receive nothing and lose the entirety of your invested capital. You should only invest amounts you can afford to lose completely.
There is no established secondary market for private company shares, SPV units, convertible notes or SAFE instruments. Your investment may be illiquid for years. You may be unable to sell your investment when you wish to, and you should not invest funds that you may need to access in the short to medium term.
Your ownership percentage in a company may be reduced (diluted) by future capital raises, the issuance of new shares, option pools, employee equity schemes, or conversion of convertible instruments. Dilution may reduce the value of your investment even if the company's total valuation increases.
Private companies are not subject to continuous market pricing. Valuations in deal materials are based on assessments at a point in time and may not reflect actual realisation value. Future valuations may be materially lower than the valuation at the time of your investment.
Many opportunities on the Platform involve companies that are pre-revenue, pre-profit or at early stages of development. Such companies may have unproven business models, limited operating history, dependence on key personnel, and are particularly vulnerable to changes in market conditions, technology and competition.
There is no guarantee of any return on your investment. Projected returns, forecasts and financial models presented in deal materials are estimates based on assumptions that may prove to be incorrect. Actual returns may be zero or negative.
Changes to applicable law, regulations, tax treatment or government policy may adversely affect the value or viability of an investment. Investments may not qualify for anticipated tax incentives (such as ESIC tax offsets). Regulatory approvals required by an issuer may not be obtained or may be revoked.
Investments through the Platform typically result in you holding a small minority interest. Minority shareholders have limited ability to influence management decisions, corporate governance or exit timing. Majority shareholders or management may take actions that are not in the interests of minority investors.
Convertible notes and SAFE instruments are complex instruments. They may not convert to equity if specified conditions (such as a qualifying fundraising round) are not met. In a wind-up scenario, your priority as a noteholder relative to other creditors depends on the specific terms of the instrument. Discounts and valuation caps may not result in a favourable conversion price.
Where you invest through a special purpose vehicle (SPV) rather than directly, you are subject to additional risks including: SPV administrative costs, SPV dissolution, reliance on the SPV manager to exercise your rights as an underlying investor, and potential conflicts of interest between the SPV manager and investors.
Some investments may be denominated in a currency other than Australian dollars. Fluctuations in foreign exchange rates may reduce the AUD-equivalent value of your investment or returns, regardless of the investment's performance in its home currency.
Deal materials are prepared by or on behalf of issuers. Vestinit does not independently verify all information provided by issuers. Information may be incomplete, inaccurate or may not reflect developments that occur after the deal materials are prepared.
Due to the illiquid and high-risk nature of private market investments, you should treat any single investment as part of a diversified portfolio. Independent financial advisers typically recommend that investors allocate no more than a small proportion of their overall investment portfolio to alternative, illiquid or high-risk assets. You should discuss appropriate allocation with your financial adviser.
The tax treatment of private market investments depends on your individual circumstances and jurisdiction. Potential tax considerations include capital gains tax, income tax on interest from convertible notes, stamp duty, and GST. You should obtain independent taxation advice before investing. Vestinit makes no representations about the tax treatment of any investment.
Certain investments may qualify for the Early Stage Innovation Company (ESIC) tax offset under Australian tax law. Qualification depends on the issuer meeting specific criteria at the time of investment, which is the issuer's responsibility to assess. Vestinit does not warrant that any investment qualifies for ESIC treatment.
You must acknowledge this Risk Disclosure Statement before accessing investment opportunities.
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