What is Return on Investment?
Outside of some income investments (Funds, MICs, etc), a return on any investment cannot be guaranteed, by FrontFundr or anyone else, including the company raising capital. Definitive statements regarding a potential public listing or its timing, beyond what has been publicly disclosed, are also not permitted.
Investments generate returns through either a capital gain realized upon sale, or some form of income distributed to investors. In most circumstances, investments made through FrontFundr cannot be sold until the company experiences a liquidity event, such as a public listing or acquisition. For more information regarding this please consult your lawyer or the company directly.
With certain investments, such as income-generating investments like mortgage investment corporations (MICs) a targeted return may be identified. This targeted return is not guaranteed.
These offerings, as well as some investment fund issuers, may provide you with the opportunity to redeem your securities in exchange for cash. These redemption rights often come with a penalty for early redemption (or in some cases, a penalty for any redemption) and can be suspended by the company in certain circumstances.
For specific questions regarding the potential return on an investment, please consult the company’s offering documents or speak with a FrontFundr dealing representative at support@frontfundr.com.
Ways to Achieve a Return on Investment
Typically, there are three ways in which you may see a return on your investment:
The company is acquired by another company, at which point you would either sell your shares or receive shares in the company making the acquisition;
The company goes public on a stock exchange, at which point you may sell your shares on the open market; or
The company generates excess cash and decides to issue dividends to their shareholders. The company’s 'Offering Document' and 'Shareholders Agreement' will outline any specific sale restrictions on your shares.
Important note: There is no guarantee that you will receive a return on your investment.
Where can I find my unrealized gains and losses?
Gains and losses can be tracked in your Investor Dashboard under the "Completed" tab. Simply click on the "Share Details" button to see any percentage change for your investments.
Please note that unlike public companies, which are valued on a continuous basis via their share price in the open market, private company valuations tend to change infrequently. Typically, changes in valuation only happen when a private company organizes an additional capital raise, in which the share price must be recalculated. FrontFundr investments are considered long-term investments, meaning these additional capital raises may only take place several years after making your investment.