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Fundrise — The first low-cost private market investment advisor
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Jonny Sandlund
Congrats on the launch, @benmillerise and team!
Throughout the new Fundrise 2.0 platform, I noticed your (primary) value prop messaging has changed from "real estate investing" to "private market investing". Is this stylistic, or a hint that you plan to expand into other private asset classes in the near future?
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@jsandlund Hi Jonny, our expertise and focus has and continues to be in real estate assets. However, we believe that the opportunity created by using technology to leverage structural inefficiencies in the private vs. the public market is not limited to real estate alone. Our team continues to think about ways to bring the benefits of the private markets to mainstream investors -- both in and outside of real estate. Because of the public nature of our investment offerings, we unfortunately can’t elaborate much beyond that in terms of what the future may hold. Full descriptions of currently available offerings, including the risks involved, can be found at fundrise.com/oc.
Love the idea. I use WealthSimple to put my stock investments on AutoPilot. This is similar but with real estate, which is great.
By the way, that website is slick AF.
Hey Ben, Congrats on the launch!! This looks very cool and it's exciting to see people continue to work on expanding crowdfunding to everyone. This looks similar to what AlphaFlow launched early this year (https://www.producthunt.com/post...
). Is this basically AlphaFlow for retail investors? Keep up the great work and congrats to your entire team!
@vandentweet Thank you! You are correct that we provide diversified real estate investment opportunities to all retail investors (both accredited and non-accredited).
From what I understand, AlphaFlow works differently in two ways: 1. it's only available to accredited, high-net-worth investors and 2. it does not originate or manage its investments.
Essentially, AlphaFlow is an additional layer on top of the investments gathering funds from investors and distributing them to third-party-held investments.
At Fundrise, our model is vertically-integrated. We originate and manage our own investments through an end-to-end integrated approach. We believe that this allows us to operate more efficiently and reduce costs for investors. Our pricing model helps explain this: https://fundrise.com/pricing.
@benmillerise Thanks, Ben! Appreciate the super-quick response and will be watching Fundrise closely. If I have any additional questions, will be in touch.
Congrats on the launch! What else do you have on the roadmap that you can share with the PH community? :)
Was curious about legitimacy of Fundrise and found these issues laid out by Motley Fool which make me weary to say the least about using their services. Would love to hear from the Makers their response to this article: https://www.fool.com/investing/2...
@bradungar Hey Brad - thanks for the question. In our opinion, the author of the article does not have an accurate understanding of how investing with Fundrise actually works and what makes it different. We see the comparisons being made as apples to oranges, like comparing investing directly in the Series A of a startup vs. buying shares of that company down the road on the secondary market (like the NYSE) -- we’re the former. I’d suggest taking a look at our pricing page which helps outlines what makes our approach unique: https://fundrise.com/pricing, as well as the offering circulars of our various offerings, available at fundrise.com/oc.
@snowjunkie21 Doug, as you point out, all investments do contain risk and any potential investor should carefully consider these risks before deciding if Fundrise is right for them. We don’t claim that investing with Fundrise is right for everyone. For those who don’t intend to trade their investments daily, we believe that a portfolio diversified with illiquid alternatives such as ours can be beneficial. A discussion of the various risks involved in each offering can be found in the respective offering circulars at fundrise.com/oc.
Roboadvisers have an advisory fee - since this is investing in each of the eREITs - is there a complex fee structure (meaning a "advisor" fee on top of the eREIT fees?) - i found myself having to sift through the 10 different offering circulars to figure out the final fee - its not transparent or simple to figure this out. I would consider being more concise and transparent in the cost of service. thats how you win loyal customers. What I'm concerned with is that (i was looking at the individual eREITS just this last weekend) - each REIT has a one time fixed fee for acquisition costs of each property and a perpetual management fee) - if by investing in 10-12 different REITS, am i paying the fixed acquisition fee for each property by all eREITS?
Also - one of the advantages of roboadviser is the benefit of automation in the liquid stock market (tax loss harvesting, automatic asset balancing (so growth assets dont outpace income assets abnormally over time) - what is done here in Fundraise thats similar (or planned in the roadmap?)
@leizerbeam Hi Joey, thanks for your thoughtful questions.
To your questions about fees, our upfront and ongoing costs vs. those of traditional investing services is explained on our pricing page: https://fundrise.com/pricing. You can also find more information in our FAQs (under “Investor Basics”): https://fundrise.com/education/faq, or in our offering circulars at fundrise.com/oc. Hopefully these resources help clear things up but let me know if not.
Regarding the benefits of the robo advisory, when you invest with Fundrise, you are instantly diversified across an array of real estate assets based on your financial goals and investment preferences. Our tech-enabled management service will then balance your account over time to make sure your Fundrise portfolio stays in line with your goals. This will primarily occur when you allocate additional funds, choose to reinvest your dividends, or receive principal payments.
We recognize that liquid asset classes may provide more frequent opportunities for rebalancing, but believe that our approach (which, we are continuing to expand on as we scale) is a great option for longer-term investors who don’t intend to trade their investments daily.
I’m Ben, Co-Founder and CEO of Fundrise. We founded Fundrise because we felt that there was an opportunity to use technology to create a smarter, more reliable investment system -- especially for the individual investor. We like to say that we’re not just changing how you invest, but what you invest in.
Fundrise is the first ever robo-advisor for real estate. We built Fundrise to simplify and open up the once-unattainable world of direct private real estate to all US investors, regardless of net worth. Until now, the private real estate markets have been largely inaccessible to individual investors. However, by investing in the private markets directly, you can earn higher, more consistent returns than in the public market.
To get started, choose a portfolio strategy aligned with your investing goals and get instant diversification across an array of low-cost and tax-efficient private real estate assets. If you’re not sure which strategy to choose, we can help you decide.
A huge thank you to our advisors, investors, early adopters, and, of course, our team for helping us build a better way to invest.
We hope you find it useful! We’d love to hear what you think and are also happy to field any questions that you have.
@benmillerise congrats. I've been a client for over a year and love the platform/product experience and returns.
@benmillerise Just want to say I have been following Fundrise for the last few years & very impressed with how the business has evolved. Also big shoutout to Chris, you guys have best in class design 🙌 🔥
Yes! Exciting. This isn't a question, just a comment of support. I've been with Fundrise from the start and have invested in several properties. I love that this empowers smaller investors to get into bigger projects. I've been very happy to watch Fundrise, and my investments, grow! Thanks, Benjamin and team!
Very cool. I've been looking for more options (not accredited yet!) and use wealthfront for stocks and got excited about Alphaflow's robo investing for my real estate but i don't qualify to invest there. Can anyone invest? How many deals do I get into with when i put my money with fundrise?
@sean_shafik Hi Sean, thanks for taking a look! Yes, any U.S. resident over 18 can invest.
To your second question, when you invest with Fundrise, you are automatically diversified across an array of real estate assets based upon which investment strategy you choose for your portfolio. We have several strategies to choose from during the signup process depending on your personal investment goals.
Over time as new assets are acquired, the diversification of your portfolio will increase. Once you choose a strategy, new assets will be added to your portfolio automatically when they are acquired.
You can preview your allocation into different real estate assets when you compare portfolio strategies at the bottom of the homepage at https://fundrise.com/.
Really like new option to tweak automated investing based on investor profile and risk tolerance.
Pros:Easy to sign up. Low minimum.
Cons:None
I have been following them for a while and great people and team to work with! Exciting stuff for the next frontier of real estate and development.