Equity crowdfunding platform VentureCrowd has expanded into the property space.
VentureCrowd Property will allow individuals to create or diversify their property portfolios online with smaller amounts of committed capital – in some cases as little as $100.
Chief executive Jeremy Colless told StartupSmart after tackling the equity crowdfunding space the company felt like it was time to take the next step.
“We feel like we’ve got a good handle on how that’s working and property is an asset class in which Australia which has got a few characteristics,” he says.
“First, Australians love real estate and we invest more in real estate in Australia than just about any other country. Affordability of property is of course a huge problem and if you’re a young investor the barriers to entry are quite high.”
Colless says crowdfunding is a space individuals as well as the big banks should be keeping a close eye on – particularly when it comes to property and equity crowdfunding and peer-to-peer lending.
“The idea of the internet is really to disintermediate and allow customers and businesses to interact directly or for customers to have a massive choice,” he says.
“The internet really democratises information and commerce. Crowdfunding platforms such as VentureCrowd allow investors to deal directly with a property without the barriers to entry – without the costs – but it also disrupts the banks and the conveyancing and the property management that acts in between and makes it difficult to access.”
Superannuation is likely to be the next industry disrupted by crowdfunding, according to Colless.
“If you’re a millennial who has $5000 a year to put into superannuation it’s very hard to get diverse portfolios without going into a managed superfund,” he says.
“But with crowdfunding, self-managed superfunds will get a lot more choice to build diversity and invest for the long term.”