What About the Risk?
Note: Crowdfunding services are not covered by the European deposit guarantee scheme, and the instruments allowed for crowdfunding are not covered by the investor compensation scheme!
The securities provided by an entrepreneur are held by the Foundation Security Trustee KOM Group. In the event of a situation where a project falls behind on payments, any collection process on behalf of investors will be supervised by the Foundation Security Trustee KOM Group. This Foundation aims to encourage the entrepreneur to make payments to investors and, in the worst-case scenario, to recover securities provided by the entrepreneur.
Through Capital Circle, you lend money to entrepreneurs. This means you are always taking a risk. Part of this risk is described in the analysis conducted for each financing application. Only applications that have been financially vetted and submitted by registered entrepreneurs pass the check. Capital Circle works with independent financial analysts who are well-versed in assessing business plans. Additionally, you have the opportunity to ask the entrepreneur questions during a 48-hour period before you can formally commit to a project. During this 48-hour window, communication between potential investors, the entrepreneur, and Capital Circle is transparent, open, and direct. Capital Circle remains independent and encourages this Q&A process to ensure that potential investors fully understand the risks involved.
You are responsible for assessing the risks, reviewing the provided documents, evaluating the project, and understanding the entrepreneur's situation.
The securities offered by the entrepreneur can only be recovered after legal proceedings. These proceedings can be costly, may take a long time, and are often dependent on many factors over which the Foundation Security Trustee KOM Group has no control. The collection costs of a recovery procedure are deducted from the proceeds, meaning less may remain for distribution to investors. The Foundation Security Trustee KOM Group does not take responsibility for the 'value of the provided securities' indicated by the entrepreneur or appraiser.
We advise you to invest a responsible portion of your wealth and, above all, diversify your investments across multiple projects.
The AFM (Dutch Authority for the Financial Markets) advises consumers to invest a responsible portion of their wealth in crowdfunding and spread it over multiple projects. As a guideline, they recommend no more than 10% of your freely investable assets.