When you hear the word “crowdfunding,” what comes to mind? Some guy raising money for his latest “app” or new gizmo?
Well, there are many types of crowdfunding, but Joanna Schwartz of EarlyShares.com deals in securities- and equity-based crowdfunding.
Yes, crowdfunding has reached the investment arena, and this area has only grown in credibility. Now it’s quite serious, she told me on a recent show.
Schwartz is the co-founder of EarlyShares.com, an online platform that gives accredited investors direct access to private opportunities.
Recent passage of the JOBS Act allows the raising of private capital using public advertising, and EarlyShares was created to capitalize on that change.
“Everything we do in our lives is moving online in a huge way. Things that five years ago we would never even consider doing online, now we can’t even consider doing offline,” Schwartz said.
“Private investing is the same thing. These regulations were holding it back. Now it’s moving online in a very big way.”
It’s really one more channel for the syndication of real estate investment, she said, adding that EarlyShares is in a joint venture with Richard Swerdlow and Property.com.
Each has its place. EarlyShares is a curated market only for accredited investors, Schwartz explained. It is focused on real estate in a low-volume, highly vetted way.
Property.com is the exact opposite, she said. It is an open, aggregated marketplace of real estate investment opportunities.
“We take a very compliance-first approach to the business. We take the regulatory hurdles very seriously. We take our responsibility to our clients very seriously,” Schwartz said.
“As the industry is developing, people are kind of finding their way and deciding what they can and cannot do. At the end of the day, these are private investments, and people are responsible for the investments they make.”
Now, I think the open syndication market for accredited investors is growing. If you’re in real estate, listen up: This is the future. If you don’t focus on crowdfunding real estate, you are missing the boat.
Click here to listen to the full interview with Joanna Schwartz of EarlyShares.com.
