Crowdfunding a Real Estate Investment
What is Crowdfunding?
Crowdfunding is a recent tool in the investment arena that is used to raise capital from many people to fund a business venture. Crowdfunding is internet based, so platforms like Facebook, Twitter, LinkedIn etc., are used to reach potential investors. The goal of crowdfunding is to accept investment capital of all sizes, so that large amounts of money can be raised quickly. Essentially, it brings the investors and entrepreneurs to the same arena with a direct focus.
Crowdfunding is governed in the U.S. to determine for instance, those allowed to fund new businesses and how much they can potentially contribute. Restrictions around crowdfunding are put in place to protect inexperienced investors from investing too much of their capital without understanding the risks involved.
Entrepreneurs use crowdfunding platforms to raise large amounts of money, sometimes in the hundreds of thousands or even in the millions of dollars. Looking specifically at real estate, crowdfunding offers more opportunity for investors who are interested in investing in large real estate developments. Real estate investors had been previously limited to investing in a REIT for deals such as this. This in part was due to individual real estate owners lacking the capital to invest directly into large income producing developments. Through crowdfunding, access to comparable deals that you see in REITs is open to all interested investors who may be willing to contribute both large and small amounts of capital.
Example of a Crowdfunding Investment
CityVest is a crowdfunding platform for real estate investors. Our team of professionals and advisory board specialize in professional real estate investing, finance, accounting, and internet technologies. Our platform provides access to institutional quality real estate deals for investors to pool their investment capital. Our candidacy for choosing deals, team members, and sponsors makes us one of the smartest and easiest to use platforms in the real estate industry.
One popular example of a crowdfunding platform for consumer goods and services is Kickstarter. Entrepreneurs use this platform to raise large amounts of money from people who are hoping to invest in the next exciting attraction.
Crowdfunding has created an opportunity for entrepreneurs to connect directly with investors via use of the internet. It’s a method of raising capital through interested audiences who are willing to invest virtually any dollar amount. Traditionally, money raised for large income-producing projects had only been accessible to big key players. Crowdfunding streamlines this process, placing opportunities in front of the more interested audiences with options to participate in large business ventures. It is a new and effective method used by thousands of users and businesses across the globe. If you are interested in investing in real estate, visit CityVest today to use our crowdfunding platform and get started with access to some of the best deals out there.