For the uninitiated, Fundrise is an online investment platform that gives one the ability to invest directly in shares of equity ownership in specific commercial real estate properties.
But as much as Fundrise is a software platform, it is also an action (as in to “Fundrise a real estate investment”). What Fundrise is doing is providing equity market liquidity, and figuratively and literally, a spigot into the equity market.
When a commercial real estate developer or an acquirer of commercial properties wants to access the equity markets, through Fundrise’s trademark-style process, they can turn on the spigot by uploading an investment opportunity onto the Fundrise system, and then invite their network of potential investors to review the details of the investment, at the prospective investors’ own pace and on their own schedules.
This is a whole new world (so far only in limited jurisdictions, but soon to be nationwide once the JOBS Act is enacted). No longer do you need to pretend you like playing golf in 90 degree, 90% humidity weather, repeating the same pitch you have delivered dozens of times to dozens of individuals. You can essentially raise equity capital from your laptop with a single pitch, delivered online, from dozens — or hundreds — of individuals.
In addition, an investment sponsor can receive the funds online, and make distributions to equity holders online, all as part of the Fundrising process. Imagine distributing a dividend to over a hundred investors with a single click; no paperwork, no signing checks. That’s what Fundrise will do very soon.
While I’m stating the obvious, this is an exciting time to be in the real estate business!
Here is a sample transaction listing in the Fundrise system as of this writing.
Here’s how it did when it took the temperature on investor interest.
Stay tuned for more on Fundrise coming soon to Model For Success.