New Triangle startup Groundfloor aims to bring crowdfunding to real estate. But first it hopes to draw a crowd to its launch party.
Advisors, investors and invited friends are coming together Monday for the Raleigh company’s celebration of the launch of its first real estate investment product, which opens the doors to anyone who has just $100 to lend. The company believes that bringing together these individual investors can do everything that traditional lenders do all while benefiting a broader base of people beyond the traditional investment power brokers.
Groundfloor last month closed its first round of investment. According to securities filings, the startup raised $125,000 and could raise $25,000 more.
“The Web has a message for Wall Street,” CEO Brian Dally said in a statement released after closing the fundraise. “Real estate innovators and doers frustrated with the bank underwriting status quo are ready to be unleashed.”
Dally, a former executive with Raleigh company Bandwidth, helped that firm launch Republic Wireless, a provider of voice and data communications.
Groundfloor works by bringing property investors and property developers together in a new and different way. Investors can put their money to work, whether it’s a little or a lot. They can invest in the financing of the properties and developers that they decide to back. It’s not like a real estate investment trust, where the fund invests in many properties but the investor has no control over which ones.
For developers seeking financing, Groundfloor is now looking only at U.S. properties that require $1 million or less in investment. Applicants also must be seeking debt financing, not equity. Applications for investment are reviewed and Groundfloor makes a decisions made based on the amount, the type and the timing of the financing.
Groundfloor’s investor’s include Capitol Broadcasting’s American Underground. Capitol is the parent company of WRALTechWire.
The Nov. 11 invitation-only launch party will be hosted by HQ Raleigh, 711 Hillsborough St. from 7 p.m. to 9 p.m.