RealtyShares closes $20M funding round

RealtyShare's $20M funding round shows real estate crowdfunding is still hot
  • Real estate crowdfunding offers developers an alternative to traditional financing.
  • Having raised an additional $20 million, RealtyShares is the latest real estate crowdfunder to close a big funding round.
  • New regulation means real estate crowdfunders may finally begin to crowdfund real estate investments from non-accredited investors.
  • Ionically, real estate crowdfunders are increasingly targeting institutional investors -- the opposite of the crowd -- and rolling out investment funds (REITs) that resemble the investment vehicle they sought to disrupt.

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Real estate crowdfunding -- online funding platforms that pool money from investors for the purchase of individual properties -- has been gaining steam over the last few years, and that momentum isn't showing any signs of abating. RealtyShares, one of a number of real estate crowdfunders, recently closed a $20 million in a funding round led by Union Square Ventures. In announcing the funding round, RealtyShares called attention to its plan to launch a diversified equity fund -- a portfolio of investments spread across a range of properties -- that targets  institutional investors. The fund highlights the ironic evolution of crowdfunders, bringing into focus their growing tendency to target large companies, not the crowd, and design investment vehicles that arguably aren't so different from those that they originally wanted to disrupt. But RealtyShares also said in a blog post that it's thinking about trying to raise funds for real estate investments from near...