We review Eco Equity’s convertible bonds paying 15% per year

Eco Equity logo

Eco Equity is offering convertible loan notes paying 15% per year. At the end of a 3 year term, investors will receive shares in the business. Investors’ funds are to be used to produce cannabis in Zimbabwe.

Its notes are currently being promoted via Facebook and Instagram, described as a “Secure Pre-IPO offer”.

Facebook ads
Ads currently being run by Eco Equity’s Facebook page. Farm Street Partners Investment Management LLP is the firm Eco Equity uses to authorise the distribution of their ads to the public.

Who is Eco Equity?

Eco Equity CEO Jon-Paul Doran
Eco Equity CEO Jon-Paul Doran

Eco Equity is headed by co-founders Jon-Paul Doran (CEO) and Timothy Ambrose (COO).

In addition to heading Eco Equity, Doran heads Axium Capital, an introducer of unregulated investments. In the last few weeks Axium Capital’s website was shut down for “scheduled maintenance”; prior to its shutdown it was marketing High Street Group bonds, under HSG’s alternative name of Keystone Property Group.

The FCA register shows that since February 2020 Doran has also been a partner in Farm Street Partners Investment Management LLP, which is the FCA-regulated company that signs off Eco Equity’s investment promotions such as the ones above.

Eco Equity Limited has been overdue with its May 2019 accounts since February 2020. This is a criminal offence under the Companies Act, and while such omissions are almost never prosecuted, an up-to-date picture of the company finances is essential to due diligence.

How safe is the investment?

Despite Eco Equity’s claims to offer a “secure pre-IPO offer” and that their notes “protect your cash with peace of mind”, these investments are unregulated corporate loans and if Eco Equity defaults – or if the shares investors receive at the end of the term cannot be sold – you risk losing up to 100% of your money.

The fact that investors are, according to reports, automatically paid with shares in the company after 3 years, rather than cash, adds an extra layer of risk compared to conventional loan notes. There is a material possibility of 100% loss if the company’s shares can never be sold.

One of Eco Equity’s ads asks investors “Tired of market uncertainty?” Given that the return Eco Equity investors receives depends entirely on what its shares can be sold for on the market, this ad is misleading. There aren’t many things more uncertain than what shares in an unlisted startup will be worth 36 months from now.

Should I invest in Eco Equity?

This blog does not give financial advice. The following are statements of publicly available facts or widely accepted investment principles, not a personalised recommendation. Investors should consult a regulated independent financial adviser if they are in any doubt.

As with any individual convertible loan note to an unlisted startup company, this investment is only suitable for sophisticated and/or high net worth investors who have a substantial existing portfolio and are prepared to risk 100% loss of their money.

Any investment paying 15% per year is inherently very high risk. As an individual, illiquid security with a risk of total and permanent loss, Eco Equity’s convertible notes are much higher risk than a mainstream diversified stockmarket fund.

Before investing investors should ask themselves:

  • How would I feel if the investment defaulted and I lost 100% of my money?
  • Do I have a sufficiently large portfolio that the loss of 100% of my investment would not damage me financially?
  • Have I conducted due diligence to ensure the asset-backed security can be relied on?

If you are looking for a “secure” investment, you should not invest in convertible loans to startups with a risk of 100% loss.

11 thoughts on “We review Eco Equity’s convertible bonds paying 15% per year

  1. This is a “First Class” web site, if more people read it “The financial ROGUES would not be in business”.

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  2. “ANY INVESTMENT PAYING 15% IS INHERENTLY VERY high risk” That is a bit misleading by you brev.

    I agree with your article, this company may well be a sham, BUT I have buy to let properties that yield between 10-15% per year and are NOT inherently risk.

    You need to practice what you preach and can not slate a company for misleading when you throw out a misleading statement yourself.

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  3. Are you soliciting investment in your buy to let property business on the basis you will pay investors 10-15% per year and it’s not “inherently risk”?

    Any investment advertising returns of 15%pa is inherently very high risk. That is not misleading, just a fact.

    Buy to let investments are high risk compared to mainstream diversified stockmarket investments as there is a material risk of permanent loss (void periods, bad tenants, falling house prices, deteriorating areas, compulsory purchase, etc) and for all but the very richest investors, the ability to diversify is very limited. They also usually involve a degree of active management on the part of the investor and cannot be compared with purely passive investments.

    If you successfully made a 15% return some year from some house somewhere, good for you. It doesn’t change any of the above.

    And I didn’t accuse anyone of being a sham.

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  4. Non of these “CHANCERS” see any problems until ” PAY DAY COMES “. Unfortunatly much of your advice falls on deaf ears . The ” Investors” canot get into there brain untill you get original capital returned “”YOU HAVE PAID YOURSELF FROM YOUR CAPITAL” QED!!.

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  5. “Any investment paying 15% per year is inherently very high risk” is what you said NOT “any investment soliciting returns of 15%” – Again, a play on words by you but thoroughly misleading.

    My point is your statement is also misleading whilst you preach about others not misleading.

    And a property is classified as an asset class as lower risk than a blue chip FTSE100 company. How many houses have you seen go down by 80% in 18 months. Regardless of void periods and bad areas. In stocks there are also risks of companies folding, divi’s being cut and even a Donald Trump tweet sending the stock tumbling.

    What if you have a “mainstream diversified stockmarket investments”, and not other assets or investments, not diversified if the market collapses is it? Or does the fact it has “diversified” in the title mean that some stocks will go down and others will go up to compensate the loss? Believe it or not, a stock or stock market can also hit 0.

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  6. “Any investment paying 15% per year is inherently very high risk” is what you said NOT “any investment soliciting returns of 15%”

    Potayto potahto. This is a review of Eco Equity’s 15% per year convertible bond offer, not your buy to let properties. Any investment that, like Eco Equity, offers a 15% per cent per year ROI to potential investors is inherently very high risk. That is not misleading, that is a fact. Eco Equity’s claims to offer “peace of mind” and a “Secure Pre-IPO offer” are misleading.

    And a property is classified as an asset class as lower risk than a blue chip FTSE100 company.

    A blue chip FTSE100 company share is an extra-high risk investment with an inherent risk of total and permanent loss. Nobody has mentioned individual FTSE 100 shares except you.

    What if you have a “mainstream diversified stockmarket investments”, and not other assets or investments, not diversified if the market collapses is it?

    Whether an investment is diversified or not has nothing to do with whether markets are going up or down. What defines an investment as diversified is whether it is spread over enough investments, across different sectors and geographies, to eliminate specific risk.

    If global markets collapse a diversified investment will collapse. When they go back up it will go up. If an investment collapses despite global markets going up, it wasn’t diversified.

    Believe it or not, a stock or stock market can also hit 0.

    A stock market can only hit 0 if every single stock listed on it hits 0. In the context of comparing Eco Equity’s bonds to a mainstream diversified stock investment, every single company in the world would have to hit 0 for a diversified stockmarket investment to hit 0. That is an apocalypse scenario, i.e. if every company in the world is worthless, that means the global economy has collapsed and it doesn’t matter what you invested your now-worthless money in.

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  7. Oh I seee, when your mislead or misrepresent its “Patayto Patahato”.

    And just so you are aware; investing into a FTSE blue chip company has never been, nor ever will be described by anyone as “high risk” as you have just described it.

    Investing all of your life savings in a single FTSe blue chip company could be a high risk move but again…you misleading again so I guess it’s Potayto, Patatho again isn’t it.

    My view has nothing to do with the ECO equity crappy investment. My argument is you can not write a review preaching about a firm misrepresenting or misleading when you do exactly the same thing when reviewing them.

    Random question been, what do you do for work? What industry are you in?

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  8. Feel free to list any investments soliciting passive investment from retail investors offering a 15% per year return on GBP that are not inherently high risk. Any other off-topic derails will be filed as spam.

    I’m not interested in chasing your random train of thought from your anecdotal buy to let returns, to your failure to understand the difference between diversification and volatility, to conflating individual shares with diversified portfolios of such shares and round again.

    If you have any evidence that the statement “Any investment paying 15% per year is inherently very high risk” is misleading, then go ahead and present it. Note that paying is a present continuous verb; investments that have paid 15% in a 12 month period but don’t solicit investment on the basis of a continuing 15% ROI are not relevant.

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  9. “Any investment paying 15% per year is inherently high risk” – misleading statmenent. If you said soliciting which you then tried to say you may have a point.

    “Investing in a FTSE100 blue chip firm is high risk” -misleading again.

    Buy to let’s being high risk – misleading.

    Hat trick of misleading comments, anyway, ecoequity is a rubbish investment based on your review, so we can agree on that.

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  10. Eco Equity is 100% a scam. We have a medical cannabis license in Zimbabwe and are far advanced. Eco Equity has been called a scam by a very high level official I cannot name due… They have achieved next to nothing as showcased on their website. They claim a valuation of 200+ million. Their head grower works in london and grows in his closet. It is even questionable whether they have a license at all at this stage. Also their projections and business model is shambolic. Stay the fuck away from these chancers!!!

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  11. Eco Equity is 100% a scam. We have a medical cannabis license in Zimbabwe and are far advanced. Eco Equity has been called a scam by a very high level official I cannot name.. They have achieved next to nothing as showcased on their website. They claim a valuation of 200+ million. Their head grower works in london and grows in his closet. It is even questionable whether they have a license at all at this stage. Also their projections and business model is shambolic. Stay the fuck away from these chancers!!!

    Like

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