Crowdfunding

I think the time has come for some investing.What do you think guys about the crowdfunding model overal?Does it really work?Since the US and the UK are decades ahead of the rest of the world there might be someone on the board with the experience.

Cheers!

 

You want to invest in a crowd funded project? Or get invested through crowd funding?

I would say crowdfunding works mainly for the people needing funding... less so for the investors....

 

I want to invest.

Why is that?You are talking about the US?

I`m residing in Russia and have some 'street retail' offers up to 14% per annum(ebitda).

 

Crowdfunding isn't exactly regulated... so that means it's easy to put your money in... but getting it out will be the problem.

What is street retail?

 

You mean liquidity?I think you just buying a piece of the income property.Could be a problem to sell it?

cafe, bars, supermarkets, shops, etc..

 

Okay, so you are thinking of buying into something like a bar or cafe...

What happens when the owner of the business walks away? Or, because you will probably not do any due diligence (check the books etc), the numbers don't add up and suddenly he goes bankrupt?

There is a whole world of risks associated with something like this... I hope you can do a proper assessment of the business...

And yes, liquidity will definitely be an issue... there is no way you can sell it off easily...

 

Mostly it`s the established fast food or hypermarkets chains, so the risk they will blow up is very low.

Where is the risk free investments, besides T-Bonds that offer 0.25 or whatever %?But thanks for your thoughts, anyway.

As for the due diligence, that`s what the Crowdfunding platforms for.They do all the job and their proprietry scoring systems to assess the objects.

 

Okay, I didn't know the platforms where that advanced... go for it!

 

I use crowdfunding for my realestate investments here in the USA. In my country it is highly regulated. Possibly over regulated. Like any trade you must do your due dilligence. At least if you take an equity position in realestate you have something of value in the event the project goes bad.

 

Let's resurrect this thread since it shows some promise of interesting discussions.

I thought about it from both the investor and the funded perspective.

While getting funded does superficially seem the better option (play roulette on somebody else's money - as long as it's not the Russian one!! ), in the light of my 80% rule I would much rather lean towards investor. Seems like you too but there's another problem here: while I've in the 99.99% chances of success asking some "startup" to take my money, the chances of getting them back with interest are severely violating my 80% rule.

My 80% rule is not to invest in something which has less than 0.8 return of capital for me (not 1.8, zero point eight) while ensuring a higher than 80% probability of me getting the deal.