Fundrise Vs. Investing In Syndications Directly

[Dan Shelhamer]

Looking at getting into syndications as a passive investor.  Does anyone have any experience with Fundrise or any other crowd funding sites?  Was interested to see the pro's & con's of investing directly with a syndicator or a site like Fundrise.

[Ian Ippolito]

@Dan Shelhamer, 

I have both syndications and crowdfunding deals in my portfolio. In my experience they are essentially the same: Crowdfunding deals are basically syndications but done over the Internet. 

The one main difference that I see is that the most experienced sponsors have a very enthusiastic investor base that they have accumulated over many years. So they don’t need to go to a Crowdfunding platform. So typically (although not always) the platforms have sponsors with less experience.

As far as Fundrise, I have interviewed many investors who have used that platform and many others. I think it’s a good choice if you are non-accredited and aggressive. On the other hand, if you are accredited, then there are many other choices with much more experience, much more skin in the game and/or much lower fees. If you are non-accredited and conservative, then in my opinion most of their options have too much risk and you will probably find other Crowdfunding/syndication deals a better match (like Blackstone real estate investment trust, BDREX etc).