Adam Hooper, CEO of real estate crowdfunder, RealCrowd describes what he considers the key issues as they relate to real estate crowdfunding:
*Access to Capital
*Efficiency with which you can raise capital
*Ease the burden of investor reporting and management
Real estate crowdfunding, is really much more than just advertising and acquiring capital. Some of the platforms that are being developed are end-to-end solutions. They are being designed to solve many issues that developers and issuers face in dealing with the need to raise capital and deal with their investors.
Adam reminds us that post-closing there is usually 3-5 years of working and reporting to investors. A crowdfunding platform should facilitate the communication with the investors during that entire investment lifecycle.
In addition to the raising of capital and facilitating communications, a crowdfunding platform should assist in the transaction management, including:
*Manage the document signing process;
*gathering the commitments
Many of these new crowdfunding platforms are designed to handle a larger pool of smaller investors, which I imagine is a totally different animal from the historic and offline investment model.
The efficiency aspect of a crowdfunding platform should not be understated. This is where technology can accommodate the increased demand for transparency and reduce costs associated with numerous investors.
Finally, and I am not sure that this solution exists yet, but I believe that an integrated solution should be available to issuers, including the ability to raise capital, manage and report to investors maintaining a high degree of transparency and accountability, management of the property, taxes and the completion of the investment.