In just a few short years, crowdfunding has become a household name with contributions raises proving that anyone can raise money for anything. Everyone’s heard of Kickstarter, IndieGoGo and GoFundMe; great stuff for consumers, but it’s not quite investment. Enter the JOBS Act, new SEC exemptions, and general solicitation, and crowdfunding comes out of the kitchen to take a seat in boardrooms as a truly viable alternative for capital formation and investment. Early adaptors are proving that regulated crowdfinance opens access to an incredible pipeline of pre-vetted curated deal flow to a much larger community of accredited investors, who were once considered out of reach. It’s shaping up to be a win-win for both side, sponsor and investor.
In the burgeoning market of crowdfunding platforms, ProHatch differentiates itself by offering a platform where contribution crowdfunding and regulated crowdfinance work side by side. ProHatch founders have seen the powerful economic growth that results from social and investment returns, and have built a marketplace where investors and sponsors can now meet, communicate and invest based on their business, real estate and philanthropic investment interests.
ProHatch’s founding team brings over 80 years of combined global real estate industry, investment and technology expertise to the table. The team began integrating Crowdfunding into their traditional strategic advisory services and capital markets practice three years ago, as an alternative capital and brand building strategy for their nonprofit clients.
Today ProHatch announces that they’ve added regulated securities issues to the platform, expanding their online marketplace to Accredited Investors and Issuers focused on financial investing in growth oriented businesses, real estate and nonprofit programs.
With the launch of regulated raises on their platform, ProHatch is initially offering equity and mezzanine investment opportunities in real estate assets and portfolios. Investors can expect to see real estate investment opportunities that have strong, experienced sponsors with proven track records and growth oriented business models. With a rigid acceptance process, ProHatch looks for projects that are currently cash flowing, producing a minimum of an 8% annual cash return on equity, have a clear exit strategy within 3 – 7 years, and a target IRR of at least 12%+.
Risk vs. Reward
As with any real estate venture, crowdfunding doesn’t take away the risk and investors should conduct the proper sponsor and asset due diligence as they would in any investment. The only difference today is that the investor and sponsor should do platform due diligence on the sites offering the opportunities. An added reward in these new investments opportunities is that there is generally a larger pool of investors investing which means more people will be eyeing the investment which can result in greater transparency. You can learn more on these topics, and others at ProHatch