Risk Disclosure

The risks of investing in private companies, including illiquidity and total loss of capital.

Read this before you buy anything. It describes what can go wrong, in the order it is most likely to matter to you.

You may lose the entire amount

Private companies fail, and when one does its equity is usually worth nothing. Unlike a bond or a bank deposit there is no floor under the value and no insurance behind it. Money committed here should be money you can afford to lose entirely without changing your plans.

You may not be able to sell when you want to

There is no public market in these shares. Selling requires finding a buyer who wants that specific company at a price you both accept, and then getting the transfer approved. That can take months, and it can fail. Assume you cannot get your money out on any particular date, and treat the possibility of never getting it out as real.

The company can stop your sale

Private company shares carry transfer restrictions. When you agree terms with a counterparty, the issuing company is asked to approve the transfer, and it may:

Refuse consent, in which case the transfer does not happen.
Exercise a right of first refusal, buying the shares itself on the terms you negotiated. You are paid, but not by the buyer you found, and any relationship you hoped to build with that buyer does not happen.
Take its time. Approval windows are measured in weeks, and price can move against either side while one runs.

An agreed price is therefore not a completed sale. Nothing settles until the issuer has had its say.

The prices you see are not market prices

Valuations shown on this platform come from company-reported funding rounds or are derived from a small number of negotiated transactions. They are estimates and they are stale by construction — a round priced eighteen months ago tells you what somebody paid then, under terms you cannot see, possibly with liquidation preferences that would pay them before you. Do not read them as a quote, and do not assume you could transact at one.

You will know less than the company does

Private companies are not required to publish audited accounts, and much of what you would want before investing may simply be unavailable. Information supplied through this platform generally comes from the company itself and is not independently verified by EquityFlowX.

Your stake can be diluted or subordinated

Later funding rounds issue new shares, reducing the percentage you hold. Those rounds commonly carry preferences that pay their holders before common shareholders in a sale. It is entirely possible for a company to be acquired for a large sum and for common shareholders to receive little or nothing.

A liquidity event may never come

The return on private equity usually depends on an acquisition or a public listing. Many companies do neither. A company can trade successfully for a decade and never produce a way for you to realise anything.

Tax

Buying, selling and holding private securities has tax consequences that depend on your circumstances and jurisdiction. EquityFlowX does not give tax advice. Take your own.

What this platform does not do

EquityFlowX does not recommend investments, does not assess whether a particular holding is suitable for you, and does not act as your agent or adviser. Verifying that you are eligible to transact is not the same as concluding that transacting is a good idea for you. That judgement is yours.

Status of this platform

EquityFlowX is not a registered broker-dealer or alternative trading system, does not provide investment advice, and holds no customer funds.