GROUNDFLOOR is the first microlending community for real estate that is accessible for investment to all. Through the innovative application of existing securities laws, they have opened the market for non-accredited investors to back independent builders with short-term secured loans that pay 8-12% annually. Investments start as low as $100, so even you bootstrappers can afford to participate. The best part? GROUNDFLOOR is moving their headquarters from North Carolina to Atlanta. When I asked GROUNDFLOOR co-founder Brian Dally why they chose ATL his immediate response was a laundry list of reasons (as you’ll see below) follow by “what took us so long?!”
We caught up with Brian Dally to find more about GROUNDFLOOR, and why they have chosen to move to our fair city:
Number of Employees:
Funding or bootstrapped:
Seed funding of $1,050,000
How’d You Get The Idea For It:
We (co-founders Brian Dally and Nick Bhargava pictured below) met in October 2012 and joined forces to bring Internet ideals to finance. Brian enjoys attacking industry incumbents from a position of weakness, most recently with Republic Wireless, which he launched to international acclaim in November 2011. Nick is a regulatory hacker who helped author the equity crowdfunding parts of the 2012 JOBS Act, making him one of the foremost experts on that very hot topic.
We earn revenues for on every dollar we raise, from origination and servicing fees paid by borrowers.
Who are your competitors and how do you stand out:
There are dozens of startups doing “crowdfunding for real estate.” You might have heard of RealtyMogul or Fundrise, for example. GROUNDFLOOR is purpose-built to create opportunities for the non-accredited investor, unlike competitors, which typically focus on creating opportunities for accredited investors. The handful of other sites that do serve non-accredited investors offer a very different financial product–typically equity in commercial properties, rather than residential renovations or construction.
How does ATL weave into your story?
We identified Atlanta as the right place to launch our pilot back when we were first bootstrapping. The state’s innovative exemption to securities law (the Invest Georgia Exemption or IGE) made it quick and inexpensive for us to get to market and start testing. Atlanta is already a finance and real estate center. IGE makes this a great place to build an investment crowdfunding company. Over the past year, we’ve been impressed by that and decided to become part of the startup ecosystem that’s gaining mass and density here.
If you could have one mulligan (do-over) in the process of launching and running this startup what would it be?
The first project we tried (and failed) to fund, a multi-family renovation on Charles Allen drive, was a mistake. Like any failure, we learned a lot, and it was the seed of the successes that came right after it.
Is there anything else you need (that money can’t buy)?
Yes. We need to hire more insanely talented and persistent people–in marketing, business development, customer operations, web design and Rails development. Is that you, or someone you know? Send them to firstname.lastname@example.org so we can get acquainted asap!
[photo credit: featured- http://shawnhunter.com/wp-content/uploads/2013/01/barnraising1.jpg, in copy- venture beat ]