Popularity in crowdfunding has evolved on the internet with new rules and regulations the market has grown exponentially. From 2009 to 2015 growing from a 530 Million globally, to 170 Billion reported Nov 2019.
Although Debt crowdfunding is most common, you can see if the graph that equity crowdfunding (purple) is gaining popularity as more investors seek to diversify their investments into real estate. In 2015 there were over 1.1 Billion in equity based crowdfunding.
Real estate crowdfunding has recently become an option in 2015. With the first changes to the securities and exchange act in 80 years, now allowing exemption to unaccredited investors.
The Securities & Exchange Act written in 1933 stated any offer to sell securities must either be registered with Securities & Exchange Commission or meet an exemption. In short these rules favor the rich. Only 8-10% of population qualify and out of reach to capital investment!
That has all changed with the 2012 J.O.B.S, Jumpstart Our Business Startups. Most significant deregulation in the Securities & Exchange laws in nearly 80 years!
Specifically, the exemptions used for real estate crowdfunding are the J.O.B.S. Act Title I, II, III and IV (Reg A+)
This is a bit complex and if you want to learn more about the securities exchange regulations, we would recommend contacting a professional.
Benefits of Equity Crowdfunding
- $170B to small businesses
- Average American can invest
- Decentralizes capital formation
- Promotes economic recovery through entrepreneurship, innovation and employment
- Builds healthier, more vibrant communities
- Does not require US government spending
- Creates jobs
Benefits of Crowdfunding to the Sponsor
- Creates opportunity for NEW capital and liquidity for entrepreneurs in their financial cycles.
- Allows businesses access to unaccredited investors and expansion capital needs
- Greater demographic reach, almost every Arizona Resident can invest!
- Equity crowdfunding can be used in conjunction with traditional bank debt.
- Efficient and expeditious marketplace (all online)
- Market is growing
Benefits of Crowdfunding to Investor
- Diversification of investments into multiple projects
- Easy, 5 minute sign up with 3rd party escrow service
- No specific knowledge required, all details provided (Offering Memorandum)
- Available to self- directed IRA
- Access to early stage investments
- Invest in Local real estate projects, help build more vibrant communities.
You have control of how many projects you participate in. Our goal is to reach 12-18% annualized return, have periodic liquidity, and have a number of projects for you to choose from.