What is the marketplace?
The marketplace connects investors who are looking to sell their investments with buyers who are looking to invest.
The investments put up for sale are investments the sellers have previously made on Abundance, either investing at the point the company or council originally raised money on Abundance, or having bought the investment on the marketplace themselves.
What investments are available?
All of the investments on Abundance are fully transferable and can be put up for sale on the marketplace, however there are occasional restrictions on selling particular investments via the marketplace depending on the status of the investment (see Restrictions when selling an investment).
As a buyer, the investments that are available will depend on what existing investors are currently looking to sell, so will change from one day to the next. You can browse the investments either by filtering by the impact the investments are having, or by filtering by the financial terms of the investments for sale.
How does it work?
An investor can put an investment they hold up for sale on the marketplace by creating an offer. They might choose to create an offer to sell all of their holding of that investment, or just a proportion of it. For example, if they originally invested £5,000 into the investment, they could choose to sell the full £5,000 or just some of it.
The seller sets a price that they want for the investment. This price might be higher or lower than the underlying amount they are selling - for example, for their investment of £5,000 they may set a price of £4,900 or £5,100. There are lots of factors that can affect the price of the investment (see Pricing investments on the marketplace), and the price set will affect the estimated return a buyer would get and therefore the demand to buy the investment.
The investment is then listed for sale on the marketplace, and other Abundance members can view the offer and consider buying it. Buyers can browse the marketplace to view the different investments available for sale. Where more than one investor is selling a particular investment, buyers can browse the different offers up for sale - investors might be selling different amounts, and at different prices.
If a buyer is interested in buying a particular investment that is up for sale, they can reserve the investment by depositing the required amount to their Abundance account. They are then put in contact with the seller by email to agree to the trade (Why is this done by email?). Once Abundance has been notified an agreement has been reached, we administer the trade, transferring the investment to the buyer and the money to the seller.
Looking for a more detailed guide to buying and selling?
Are there any fees?
No, there is no cost or fee for using the marketplace, either as a seller or buyer.
Why might an investor want to sell?
The investments on Abundance are fixed term investments. This means that once you have invested, your money is committed and you will only receive back your capital and your return based on the payment schedule for that investment. For this reason, you should only invest if you’re happy to hold the investment for its full term.
However, circumstances change, and some investors may want to get back some or all of their money earlier than it is due to be paid back. The marketplace lets these investors look to sell their investment to others. The ability to sell an investment will depend on the demand to buy the investment from other investors, and the amount they are willing to pay for it.
Why would I buy an investment on the marketplace?
The marketplace gives you the opportunity to invest in any of the investments that have previously raised money on Abundance. This can help you diversify your portfolio across a wider range of investments, and also find investments that meet your particular needs - whether that’s choosing the impact sector that has the positive impact you want to have with your money, or the length of time you’re looking to invest for. Remember there are risks when investing on Abundance, including when investing on the marketplace.
What is the price of an investment?
When you buy an investment from another investor, you are buying the rights to receive the payments that are still due on that investment. How much you are willing to pay for the investment is ultimately up to you, and might differ from one investor to another.
There are a number of factors that you might consider when determining the value of an investment, such as how much is still due to be paid back, when the next payment is due, and whether there has been any change to the risk for investors. Learn more about the things to consider here.
Why do I need to agree a trade by email?
The Abundance marketplace operates as what is known as a ‘bulletin board’, and not a regulated exchange like the stock market.
This means that the offers to sell investments on the marketplace are non-binding, and buyers and sellers will need to agree to a sale away from the Abundance platform. Therefore, when a buyer is interested in purchasing a seller’s investment, we put both parties in contact by email to come to a written agreement. This agreement can come in many forms, but a simple email agreement between the buyer and seller can be sufficient. Find out more here.
Abundance expects members who are using our marketplace to treat each other with respect and conduct their trades in a courteous manner. If either a buyer or seller feels that another party is not using the system appropriately or is being abusive, please report this to Abundance immediately and we will investigate the matter. Abundance reserves the right to revoke a person’s membership if such claims are substantiated.
Always remember, there are risks when investing on Abundance, including when investing on the marketplace. Your capital is at risk and you could lose all the money you invest. The return on your investment depends on the ability of the company or council you have invested in to pay your returns. Investments on Abundance are generally long term and you should be prepared to hold them to maturity. The investments are illiquid and you may not be able to sell them if you need your money back earlier, and their value can rise or fall. Quoted returns are no guarantee of future returns and past performance is not a guide to future performance.