Advancing Forward: The Top 60 US Real Estate Crowdfunding Platforms

Crowdfunding is likely to be an effective alternative to traditional sources of institutional capital such as venture capital firms and angel investors.
12/24/2014 08:51 am ET Updated Feb 22, 2015

After the passage of the JOBS Act in 2012, crowdfunding as a new investment vehicle for investors in the US has flourished, and you can find platforms that specialise in real estate crowdfunding all across the country. The industry is full of platforms which offer innovative services which have succeeded in bringing crowdfunding in the real estate business to prominence as a credible and reliable source of raising capital.

For example, both accredited and unaccredited investors can team up with a Washington-based platform called Fundrise to choose from a number of hybrid debt and equity transactions of institutional quality in which the minimum investment can be as low as $100.

As the success of early pioneers brought new entrants into the industry, the real estate crowdfunding industry grew from fewer than 10 platforms in 2012, to now more than 60 different platforms.

Another notable development was the launch of an equity investment platform for accredited investors earlier this year by a well-known institutional capital provider, The Carlton Group. The target audience are high-quality accredited investors or groups of investors who can invest a minimum of $1 million in any of the projects enumerating on the website. Another pioneering platform, GroundBreaker provides full SaaS technology support, making it that much easier for real estate companies to take an ownership position in crowdfunding platforms.

Other platforms have noticed the real estate opportunities and introduced innovations and new business methods. Equity crowdfunding platform CrowdAlliance is focused on streamlining the methods of fundraising by providing a technology platform which serves as online marketplace to facilitate the participation of entrepreneurs and investors alike. FundAmerica takes a different approach by concentrating on providing proprietary tools and technology at the lowest possible cost and enabling users to use seamless solutions in complete compliance with state and federal regulation. A serial entrepreneur and the founder and CEO of FundAmerica, Scott Purcell believes that online platforms such as his provide complete solutions for real estate entrepreneurs and developers in the search for online funding.

With the continued expansion and growth of the industry, we will continue to see the emergence of new platforms in new niches with new business models. For instance, this year saw the emergence of RealtyWealth which is the first of its kind in the commercial real estate space specialising in triple net lease deals involving single tenants and provides deals of institutional quality. With the rapid growth of technology to provide support, we can expect to see many innovative new platforms with their own focus and business methods.

Here is the list of the top 60 platforms leading the game in the U.S. real estate crowdfunding industry, in alphabetical order:

American Homeowner Preservation
AssetAvenue
Blackhawk Investments
Carlton Accredited Equity Crowdfunding
CrowdMason
CrowdRealty Co.
CrowdStreet
CrowdTranche
CrowdVested
CRWD
Deitscho
DiversyFund
EquityHunt
Funding Hamptons
FundingRoots
Fundrise
Goodwin Procter
Groundfloor
GroundBreaker
Home Union
iFunding
InvestPeer
Loquidity
Mainstreet
Mayfair&Morgan
Money 360
NexRegen
NXGen Capital, Inc.
The NNN Crowd
OpenSource Capital
Own It Detroit
PassiveFlow
Patch of Land
Peer2PeerNetworks
PeerRealty
PeerStreet
Primarq
Prodigy Network
ProHatch
PropFunds
Propellr
PropertyPeers
Real Circle
RealConnex
Real Liquidity
RealCrowd
Realquidity
Realty Crowdfunding LLC / Funding Hamptons
Realty Mogul
RealtyShares
Rich-Uncles
Sequorum
Sharestates
Sprovy
Stake
Terra Funda
Tycoon Real Estate
Vestor
Wealth Migrate
WeAreCrowdfunding

The real game changer has proven to be the access to institutional capital and investment which has been made possible as a result of institutional players entering the real estate crowdfunding industry. This means that even developers who are just starting projects can raise low-cost funding from the kind of investors to whom they would normally have little or no access. Moreover, this has resulted in enhanced interest from quality institutional investors in crowdfunding platforms because they have realised the potential for the industry. The future of the industry will thrive on a mix of institutional capital and funding from the crowd. Crowdfunding is likely to be an effective alternative to traditional sources of institutional capital such as venture capital firms and angel investors.