Bricksave's mission has been to democratize investment from day one. While Fintech Company has been increasingly expanding in Latin America, we have met with Bricksave CEO Tom de Lucy who took us through his view about the evolution of investment over time and what potential lies for people in real estate crowdfunding investment.
How do you feel about how Fintechs are affecting the way in which people invest?
More and more Fintechs are emerging today that allow individuals to build true capital reserves and earn in ways previously only accessible to High net worth individuals. This is not just the remit of the younger generation, older ones are also increasingly comfortable and even prefer to invest on their phones.
Newspapers, magazines, in-office visits, and long client lunches are no longer part of individuals joining the investment community. Accessibility, ease of use and recommendations from friends and colleagues are the most important factors in deciding what assets to invest in. It is for this reason that we believe online capital formation will continue to grow and more and more people will be able to build wealth.
Where do you think that Real Estate Crowdfunding fits into this online model?
We are already seeing that Real Estate Crowdfunding is becoming an accepted investment vehicle and more and more people are taking advantage of the opportunities it provides.
Crowdfunding is built upon the two key pillars for individuals making investment decisions today: trusted recommendations (who do people know and trust that are also investing through the platform) and ease of use (is it accessible and is there a frictionless investment process).
Groups like BrickVest and MyRichUncle had a popular product however they faced operational struggles from over complicating a product designed for a new retail market.
What about blockchain technology? Do you think you will adopt it soon and how will it affect online investing?
Blockchain is a technology we have looked at and are well-positioned to adopt when the time is right but today we don't believe that wide adoption is likely. For real estate investing because it only becomes efficient when you can utilize blockchain as part of a fully end-to-end transaction. The reality is that there are institutional real estate and financial controls which means this isn't possible to truly disrupt the investment process. Blockchain for real estate crowdfunding is a nice tool to have and can be good as a marketing exercise but it does not directly improve the client's user experience. At Bricksave our focus is always on ensuring the best experience and most secure investments for our clients, we won’t build something just because it is a buzz-word or gimmick. That being said, we are keeping an eye on developments and will be ready to move when the time is right.
Is there liquidity with the investments Bricksave is offering?
The reality is that Real Estate Crowdfunding is still an alternative investment product and alternative investments have zero or limited liquidity options.
Depending on each individual asset the liquidity horizon can vary but investors should, in general, make their decision based upon the knowledge that they will be receiving rental yields from day 1 but at the same time realizing that it will take some time to receive their initial investment back.
We do believe that liquidity will be a great option for our users and are continuing to monitor regulatory developments that would allow us to offer a secondary market and liquidity to investors.
February 25, 2020
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