Risk Disclosure

Important — please read this disclosure carefully before using DivestWorld. Acquiring a business, taking up a franchise, or investing in a startup involves substantial financial risk. You may lose part or all of the money you commit. By using the Platform, you acknowledge and accept the risks set out below.

1. DivestWorld Is Not an Investment Advisor

DivestWorld is an India-based online intermediary platform. We are not registered with the Securities and Exchange Board of India (SEBI) as an investment advisor, research analyst, portfolio manager, stock broker, or merchant banker. We are not registered with the Reserve Bank of India (RBI) as a bank, non-banking financial company, or financial institution. Nothing on the Platform, including listings, valuations, AI-generated estimates, blog posts, search results, or messages, constitutes investment advice, financial advice, legal advice, taxation advice, or a recommendation to buy, sell, or hold any business, asset, or security.

You are solely responsible for evaluating the merits and risks of any transaction. If you require advice, consult an independent professional adviser registered with the relevant Indian authority.

2. General Risks That Apply to All Transactions

• Loss of capital. Buying a business, franchise, or stake in a startup is fundamentally risky. Returns are not guaranteed and partial or total loss of your capital is possible.
• Illiquidity. Stakes in private businesses, franchise rights, and startup equity cannot be sold quickly. There is no public market for them. You may not be able to exit your investment when you want, or at the price you want.
• Information asymmetry. The seller, franchisor, or founder typically knows more about the asset than the buyer or investor. Despite our verification efforts, listings rely heavily on what the lister tells us.
• Past performance is not indicative of future results. Historical revenue, profit, growth, or returns do not predict future performance.
• Macroeconomic and regulatory risk. Changes in interest rates, taxes, policy, regulation, or market conditions may materially affect the value of your transaction.
• Concentration risk. Investing a large portion of your wealth in a single private deal exposes you to outsized risk. Diversification is generally prudent.

3. Specific Risks — Buying a Business

• Hidden liabilities including outstanding debts, unpaid taxes, employee dues, pending litigation, customer claims, and supplier obligations may not be apparent from the listing.
• Customer concentration. Revenue may depend heavily on a few customers whose loss would damage the business.
• Key-person risk. The business may depend on the seller's relationships, skills, or presence.
• Regulatory licences. Required licences, registrations, and approvals may not transfer automatically with a sale.
• Lease, premises, and supplier agreements may contain change-of-control clauses that allow termination on transfer of ownership.
• Goodwill and brand value, often a major component of the asking price, are subjective and may not be realisable.
• Working capital requirements after acquisition can be significant. Allocate sufficient reserves before completing the purchase.

Engage a qualified chartered accountant for financial due diligence and a corporate lawyer for legal due diligence before signing any acquisition agreement.

4. Specific Risks — Franchise Acquisition

• Brand strength may be weaker than represented. Check independent reviews and visit existing franchise outlets before committing.
• Royalty, marketing, and management fees compound over time and can substantially reduce profitability.
• Territorial protection clauses may be narrower than expected, allowing competing outlets nearby.
• The franchisor may impose additional capital expenditure during the franchise term.
• Franchise agreements typically favour the franchisor. Renewal, exit, and resale rights may be limited.
• Loss of the franchise, whether due to breach, disputes, or non-renewal, may render your investment worthless.
• Build-out costs, equipment specifications, and supplier mandates may exceed initial estimates.

Read the franchise agreement and franchise disclosure document, where applicable, in full with a lawyer before paying any deposit or signing.

5. Specific Risks — Investing in Startups

• High failure rate. A large proportion of early-stage startups fail. You should be prepared to lose your entire investment.
• Dilution. Future fundraising rounds will reduce your percentage ownership, potentially significantly.
• No dividend or yield. Most startups do not pay dividends. Returns depend entirely on a future exit through acquisition, public listing, or buyback, which may never happen.
• Long time horizons. Even successful startups typically take five to ten years or more to provide meaningful liquidity.
• Minority position. As a minority investor, you may have limited control over company decisions, board composition, or future fundraising terms.
• Valuation uncertainty. Pre-revenue or early-revenue startups have no objective basis for valuation. Figures are negotiated, not measured.
• Information access. Private companies have limited disclosure obligations. You may not receive timely updates on company performance.
• Regulatory risk. Investments in unregistered offerings, unregulated platforms, or schemes that resemble public solicitations may violate Indian securities law. Confirm legality with a SEBI-registered advisor before investing.

Listings on DivestWorld are private offerings and not public issues of securities. They are not vetted, registered, or approved by SEBI. Only persons who can sustain the loss of their entire investment should consider startup investments.

6. Listings Are Not Verified to Investment-Grade Standards

While we may apply basic checks to listings, we do not perform forensic accounting, audit historical financials, validate intellectual property, verify customer relationships, or confirm regulatory standing. Approval of a listing on the Platform does not constitute endorsement, recommendation, or any warranty of accuracy, completeness, or quality.

You must conduct your own due diligence, which may include:

• Reviewing audited financial statements.
• Confirming GST, PAN, and statutory registrations.
• Verifying titles, licences, and contracts.
• Speaking to customers, suppliers, and employees.
• Engaging a chartered accountant, corporate lawyer, and where relevant a tax advisor.

7. Tax Implications

Acquisitions, franchise grants, and equity investments have tax consequences under the Income-tax Act, 1961, the Goods and Services Tax framework, and other applicable Indian tax laws. These include income tax, capital gains tax, GST, stamp duty, and tax deducted at source. Tax treatment depends on the structure of the transaction, the parties involved, and your individual circumstances. Consult a qualified tax professional before transacting.

8. Risk of Fraud

Despite our verification efforts, fraudsters do occasionally use platforms like ours to misrepresent assets or solicit unauthorised payments. Protect yourself by following these practices.

• Verify the identity and credentials of the counterparty independently.
• Do not transfer funds outside the Platform's payment channels until you have completed legal documentation.
• Be cautious of any pressure to act quickly, requests for off-platform payments, or guaranteed returns.
• Report suspicious activity immediately to support@divestworld.com.

9. Acknowledgement

By using DivestWorld and entering into any transaction through the Platform, you acknowledge that:

• You have read and understood this Risk Disclosure.
• You are aware that you may lose part or all of your investment.
• You will conduct your own due diligence and seek independent professional advice as needed.
• DivestWorld bears no liability for losses resulting from any transaction or decision you make.
• You are not relying on DivestWorld for investment, legal, financial, or tax advice.

10. Contact

• Email: support@divestworld.com.
• Phone: +91 78279 07475.