Analyst Report: Upgrade for access Groundfloor Gives Non-Accredited Investors a Massive Opportunity

Groundfloor lets retail investors invest in loans for renovating and redeveloping residential properties. But it has to navigate a few risks.

Details
Company: Groundfloor (Finance)
Security Type: Equity - Preferred
Valuation: $243,407,782
Min Investment: $100
Platform: Wefunder
Deadline: Nov 18, 2022
$4,999,991
$2.3M
Inez Sanjaya - November 16th, 2022

Chasing Polaris

When I first entered the workforce, my parents raved about this thing called “financial independence.” They said that my goal should be to reach it by the age of 40 or 50. So that became my North Star. 

I started eagerly browsing the internet and social media to find ways to increase my revenue stream. In a generation that glorifies side hustle culture, I found a plethora of methods. Second to the most popular method (investing in the stock market) is investing in the real estate market. It is an excellent addition to an investor’s portfolio, as it has a risk-reward profile that doesn’t really correlate with the stock market. 

Stepping into the real estate market often includes buying a property, developing and managing it, and reselling it for a higher price. But for new graduates (like me at the time) or pretty much anyone without thousands of dollars in savings, that’s almost impossible to do, as it requires a lot of capital upfront. 

A second option is real estate investment trusts (REITs), publicly traded companies that finance and manage real estate assets. These assets generate income and can give investors high dividends. 

As exciting as they sound, REITs have their downsides — one being that they’re best for long-term investing. Real estate values tend to increase over time, so investors will yield a better return if they hold on to REITs for a longer period. While that might work for some investors, this is not ideal for people like me who want short-term returns. In the end, I went back to just investing in the stock market, thinking that I didn’t have any options to diversify into real estate. 

But a company called Groundfloor proved me wrong. There is a better way for real estate investors (be they novices or experts). Groundfloor, which operates in 23 states, is a platform that breaks down the wall between retail investors and real estate. With a minimum investment of just $10, Groundfloor has a multi-year history of giving investors a 10% return on their real estate investment in just nine to 12 months. Low capital upfront and high return in a short period of time is the perfect combination for short-term investors. Groundfloor also recently launched Stairs, a savings account that allows investors to save money and gain an annual fixed rate of 4%. Investors can withdraw anytime with no fee. 

How can Groundfloor pull this off? Let me take you through a typical user journey and show what’s going on behind the scenes.

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