EIS Investments in JustPark and Grind Coffee

wmb194

TheKDs said:

wmb194 said:

TheKDs said:

@steampowered so if I want to take the risk and invest on Crowdcube, IF it were successful and became a public company, or is purchased, I can then sell shares. Or keep them. Is that right? How long does that take if it ever happens?

If they list you could probably either keep them or have the option to sell them as some of the shares on offer for the IPO.

If the company is bought it'll depend on the terms of the deal. These days they're often all cash and shareholders are forced to sell their shares at the finally agreed price but it could be e.g., part cash and part shares or all shares in the acquiring company.

Forced to sell?

Yup, happens all of the time: read about recent all-cash FTSE350 acquisitions. It's how they buy-out the small shareholders once the majority agrees. There'll be a court order. It's very standard and it's to avoid small holdouts and people who don't engage from making things messy.

Johnjdc

TheKDs said:

wmb194 said:

TheKDs said:

@steampowered so if I want to take the risk and invest on Crowdcube, IF it were successful and became a public company, or is purchased, I can then sell shares. Or keep them. Is that right? How long does that take if it ever happens?

If they list you could probably either keep them or have the option to sell them as some of the shares on offer for the IPO.

If the company is bought it'll depend on the terms of the deal. These days they're often all cash and shareholders are forced to sell their shares at the finally agreed price but it could be e.g., part cash and part shares or all shares in the acquiring company.

Forced to sell?

Not sure why this thread has resurrected but yes. The founder or at least the major investors will own well over 50% of the company. If they agree for it to be bought by someone else, your shares get sold at that price, there's rarely option to say "actually I want to keep my shares and own shares in the new company".

By and by in the EIS space Crowdcube are not very good at communicating. Seedrs are a little better. Growthdeck are good but have a high minimum investment. SyndicateRoom are excellent but will build you a portfolio of 30-40 companies, you don't get to pick and choose yourself which for some people is the fun of it.

The other thing for OP is of course loss relief, you might get some money back (additional tax relief) if the companies go bust, too.

steampowered

TheKDs said:

@steampowered so if I want to take the risk and invest on Crowdcube, IF it were successful and became a public company, or is purchased, I can then sell shares. Or keep them. Is that right? How long does that take if it ever happens?

If the company did an IPO and became a public company, your shares would be listed on the stock market. You could sell them or keep them just like shares in any other public company.

If the company is sold (e.g. to a trade buyer or a private equity firm), you would usually be forced to sell your shares and would receive the sale price. This is called a "drag along" process. The way this works is that, if a percentage of the shareholders of a company agree to sell their shares (e.g. 75%), all of the remaining shareholders must also sell their shares on the same terms. 

If the company goes under, you would get nothing but as you invested under EIS you can write the loss off your income tax bill, so you'd get something back from the tax man.

danny_lowe

I also invested in JustPark 6 years ago but cannot find any place to view the current share price or see where I could sell my shares. It seems a bit dodgy not to tell investors how this works and how they can pull their investment out. How do I find out what the share price is?

wmb194

danny_lowe said:

I also invested in JustPark 6 years ago but cannot find any place to view the current share price or see where I could sell my shares. It seems a bit dodgy not to tell investors how this works and how they can pull their investment out. How do I find out what the share price is?

It's unlisted so it won't be easy. You could have a look on Crowdcube. Its last accounts are a bit stale and there ought to be some new ones soon but they show it's been losing money for years and doesn't look like it'll turn around anytime soon so I'm guessing not a lot.

https://www.crowdcube.com/explore-companies/justpark

https://find-and-update.company-information.service.gov.uk/company/05956777/filing-history

gingercordial

danny_lowe said:

I also invested in JustPark 6 years ago but cannot find any place to view the current share price or see where I could sell my shares. It seems a bit dodgy not to tell investors how this works and how they can pull their investment out. How do I find out what the share price is?

The point is you can't sell/pull your investment out. It's a private company, not listed on the stock exchange, there is no set "current share price". The only option you would have would be to sell the shares privately to someone you find yourself, at whatever price you agree between you. Or wait until either (a) the company "floats" on the stock exchange, in which case there is a trading market, or (b) someone wants to buy out the whole company and makes an offer to all shareholders. But neither of those things will happen if the company isn't doing well.

When you sign up to Crowdcube (or similar platforms) you have to tick a box saying that you understand what unlisted shares are, that you can lose all your money invested and that know you are investing in things you can't always get out of. 

Albermarle

This is at the top of the Crowdcube home page and remains there even if you scroll down.
Don’t invest unless you’re prepared to lose all 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

Although the print size is not as big as the promotional stuff.

Then this is at the bottom

Risk warning

Investing in start-ups and early-stage businesses involves risks, including illiquidity, lack of dividends, loss of investment and dilution, and it should be done only as part of a diversified portfolio.