Seed Capital - Crowdfunding

15 Replies

Hi Guys, I am seeing plenty of crowdfunding platforms for real estate now. What are your thoughts on this? Would you use them personally, or do you know anyone that has used them with success?

https://www.therealestatecrowdfundingreview.com/top-100-sites-ranked-and-reviewed

Even though I agree that this should have been posted in the Crowdfunding thread, I will give my opinion on the topic anyhow. Crowdfunding is great, and will certainly disrupt the industry. There are some great online tutorials and overviews of the concepts, I suggest you start there!

Personally, I am not sure how I feel about so many owners to one piece of property. Perhaps I have the wrong idea, but it seems to me like it could wind up quite unfortunate for the principal investor involved. 

I have no experience with seed capital crowdfunding, though I hear great things and many success stories among some younger colleagues. I would appreciate some further explanation on the topic before I feel it prudent to throw in judgement. 

I have used Reality Mogul much the same way I use Bitcoin. I only put a small amount of time into it, more as an entertainment item in my spare time, but I wouldn't make a career of it. Seed capital raised on your own is surely more profitable and preferred than selling off such large swathes of equity. 

I am not a big fan of crowdfunding! Must have missed the boat on it. I just feel like the ownership of your investment becomes hideously complicated when you have hundreds of small contributions to a single unit.

@Tyrel McAllister you need to do a lot of homework on who is running it, their experience and what is the investment. When times are good of course everyone will Love crowdfunding, but when economy ranks and if the fund gets in trouble what does the fine print say. Will you have to kick in more money ? Do the partners get first money out of deal and then the balance of people are left with the scraps ?

The devil is always in the details. Having spent 20 years in real estate my rule of thumb is the more people involved in a deal the more trouble it becomes, especially when you know what hits the fan.

@Travis Koolick I have done a lot of research and reviewing a regulation D506(c) offering for my investments. I have also been in commercial real estate for over 20 years and recently worked on a $100M project we funded and am in the works on getting another project around $100M in funding. While I specifically have not done crowdfunding or invested in a crowdfunding site, I am very familiar with the ins and outs of it.

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