What do I need to know about early-stage investing? Are these investments risky?

1. Companies on TradeWinds platform can be considered high risk opportunities and may not retain their value. Investing in start-ups and small businesses is inherently risky, and standard company risk factors such as execution and strategy risk are often magnified at the early stages of a company. In the event that a company goes out of business, your ownership interest could lose all value. Furthermore, private investments in start-up companies usually illiquid investments that typically take up to five to nine years (if ever) before exit.
2. While there are no guarantees that this strategy will reduce your risk, most investors choose to mitigate risk by practicing portfolio diversification. Investing smaller amounts across a large number of opportunities is a good practice in the private markets just as it is in the public markets and is a great investor benefit facilitated by the JOBS Act.
3. For additional information on risk regarding early-stage investing, please visit our General Risk Factors.