Why So Many CRE Crowdfunding Platforms Tanked, And How A Select Few Found Success

cre crowdfundingSharestates Co-founder and CEO, Allen Shayanfekr spoke to the BISNOW team about the evolution of real estate crowdfunding since its 2012 inception. Shayanfekr also discusses how some platforms were able to remain successful while others had to close their doors. Check out a snippet below and click the button to read the full article.

When the federal government signed the JOBS Act into law in 2012, it breathed life into hundreds of new commercial real estate companies offering cheap capital sourced from massive pools of small, private investors. The age of crowdfunding had arrived.

Since then, most crowdfunded CRE lenders have consolidated, been acquired or folded. For the few that have found success, the journey to profitability has been a struggle to remain independent, serve their customers and carve out a niche within the crowded CRE lending space.

“You can find bad CRE deals all day long — that’s what a lot of crowdfunding platforms did, and it’s why they’re no longer around,” Sharestates co-founder and CEO Allen Shayanfekr said. “The more you grow in real estate, the more nuanced and complex the industry becomes. Having a strong background in real estate before getting into crowdfunding is why Sharestates prospered where others disappeared.”