Tuesday, November 20, 2012

Atlantic Cities: Fundrise Could Change Everything

Maketto was funded partly through Fundrise. Image courtesy of Fundrise

The Atlantic Cities has a an interesting piece on Fundrise, which is the brainchild of the Miller brothers. Their company WestMill Capital has acquired multiple properties (1207 H Street, 1351 H Street, 1337 H Street, 906 H Street) along the H Street Corridor. Fundrise is a funding/investment approach that differs greatly from the norm in that it allows local investors to buy into a project with only a small amount of money. Read more about it here, or on the Fundrise website.


Anonymous said...

Fundrise for Maketto was an interesting idea and I was very excited about it, but I read through all the paperwork and as an investor I would basically be assuming all the risk and all control over my shares could be trumped at any time by the business owners.

Is there anybody out there who did buy into this, and can explain to me why this, as structured, was a smart investment given how little real ownership you would have after buying in?

Anonymous said...

I know its more an issue with the authors of the articles, but they make these guys sound like the saviors of H St.. I know they need PR, but from folks who have been here even a short while, it comes off as grandstanding.

Also .. I dont see how this is any different than investing in something like a mutual fund.. except that its worse:

You give your money to someone without any control over that money, and those people either lose your money, or make you more money.

.. the part thats worse is that you're giving your money to a business / restaurant that is likely being run by someone who is either new to the business and has no connections, or who has a bad track record and has no large investor. Even good business ideas can fail with bad execution.. it just seems to be a much higher risk.

I guess the only upside is that the miller guys wouldnt likely recover from a failed business early on, so they will probably do everything they can to make sure you dont lose money on the first go around.

Or maybe you get a failing bakery / bar / store for a couple years before they burn through the investment.

Unfortunately, I think the idea is a lot cooler than the reality.

tubbs said...

folks, if you give me your money today, I promise to make your asses bleed within a fortnight, as opposed to how long it may take with this kind of stunt. But, with me, it's a reverse happy hour. Get in early.

Anonymous said...

Wildly agree with previous comments...I skimmed the paperwork...seems like investors take all the risk and if the business does well, the owners can buy you out. The only upside is that you're "investing locally." I'm not crazy about investing in retail shops or restaurants on H Street that aren't going to generate enough revenue to pay their rent. This is all just a massive marketing scheme to make you feel good about your neighborhood.

heyktb said...

wish they would just get off the stick and get SOMETHING done there. so tired of "investors" buying up property and then sitting on their asses/assets instead of creating something useful and profitable for the neighborhood. until these daddy's boys show some progress, i say enough already with the free publicity!