GROUNDFLOOR, a revolutionary real estate lending marketplace open to non-accredited investors, has closed a $5 million Series A, bringing its total financing to $7.5 million. The round was led by Fintech Ventures, a new $100 million fund strategically headquartered in Atlanta to provide equity to emerging leaders and promising companies that are developing innovative, non-banking lending/savings products and smart payment solutions.
The innovatory idea driving GROUNDFLOOR makes it a no-brainer, initial investment of the Fintech Ventures Fund. The first and only “real estate crowdfunding” website provides short-term, high-yield returns backed by real estate. With typical loans returning 12 percent annually on a six-to-12-month term, clients are waiting in line to use it.
“Once people understand what it is they jump on it,” said Brian Dally, Cofounder and CEO of GROUNDFLOOR. “People have the choice to pay to Wall Street, and watch risks or wait to see if a product will perform. With us, it sounds incredible that you can make a higher return than the stock market with less risk and more control. We actually have limited access – it is by invitation only – because there is such high demand.”
Founded in 2013 by Dally and Nick Bhargava, GROUNDFLOOR plans to use the new funds to scale lending operations and drive nationwide expansion. The marketplace is now operating in eight states and the District of Columbia, and rapidly growing to serve additional jurisdictions. The company has funded 54 loans and sold over $3 million in Limited Recourse Obligation securities to date.
“Currently, we are making 5-10 loans a month, and now we are going to expand that, especially here in Atlanta,” said Dally. “We have about 15 open jobs right now, and are excited to bring on people who can help build a lot of great software, as well as great real estate lending people.”
Dally champions Georgia Secretary of State, Brian Kemp, and his progressive lawmaking as the reason why GROUNDFLOOR is possible only in a city like Atlanta.
“People have told us that we could not build it here. I have a friend in Silicon Valley, a venture capitalist, who told me that we could only achieve this in the Valley. I said, tough, I am not going to move there. The capital is here, the talent is here, the regulations are here. We couldn’t do this in California. Now we move on with plans to build a truly great product. I am so proud to build a company like GROUNDFLOOR right here in Atlanta.”
(We couldn’t agree more, Mr. Dally.) To learn more about GROUNDFLOOR and follow its inevitable rise to new heights, visit their blog, Facebook and Twitter pages.
