There is a big difference between tradition investments and crowdfunding. Some people may even call it a war. What is the difference? Every investor knows that not all projects are suited for crowdfunding, however, there are many great opportunities that you may be missing out on. This is when real estate crowdfunding platforms come in handy. The experts at Luxe Crowdfunding are here to explain how it works and hopefully ease any confusion you may have. We are experts in commercial real estate investing in the United States.

 

What’s The Difference?

  • Private equity is an investment made into a business often by a private equity firm. These investments are administered by managers that use a variety of strategies such as a leveraged buyout, venture capital, and growth capital to infuse cash into a business. Private equity firms generally charge a management fee and a performance fee. There are three ways that private equity firms receive a return on their investment.
  • Crowdfunding is a method to raise capital through family, friends, customers and individual investors. The technique used is to raise small amounts from a large group of people. This is typically done via the internet.  On a global level, crowdfunding has increased dramatically.
    • There are three different types of crowdfunding.
      • Donation Based.   This type of crowdfunding is not usually used for businesses but more for non-profits, charities, and disaster relief.
      • Reward Based.   Individuals who invest in your business will be rewarded generally in the form of a product or service offered by your company.
      • Equity-Based.  Investors will become part owners in the company and will receive a financial return on their investment.

 

Why Should You Turn To Real Estate Crowdfunding Platforms?

One of the best reasons for considering crowdfunding is the ease and simplicity of launching a fund-raising campaign. All the major platforms will guide you through the process step by step, as you prepare your “pitch.” Because you are asking for relatively small individual investments, you don’t have to prepare a long business plan with detailed financial forecasts for a major investor or a lender.

 

Another plus is that you don’t have to give up a share of ownership in return for funding. You can repay your investors with a share of the profits from a successful crowdfunding campaign. Crowdfunding also lets you move forward with your plans without the financial burden of paying back a bank loan.

 

Crowdfunding is an important alternative source of financing for small, mid-size, and large online businesses. So before reaching out to a new partner or applying for a loan, take a close look at the leading crowdfunding platforms to see if this new strategy can help you achieve your business goals.

 

Call Us For Commercial Real Estate Investing

We are the ones to turn to when it comes to real estate crowdfunding platforms. If you are interested in learning about real estate crowdfunding or even some more details about real estate investment companies, be sure to call us today! We are one of the best real estate crowdfunding sites. Here at Luxe Crowdfunding, we are entirely here for you. Our investing experts have the best expertise in the United States. We endeavor to excel in every service we provide, adding value for our investors wherever possible, and thereby succeeding nationally in the construction industry. We offer the best commercial real estate investing services.