Groundfloor recently launched our new Auto Investor Account, which was recently showcased in a webinar hosted by Brian Dally, Co-Founder and CEO, along with Chris Garrett, VP of Product.
The Auto Investor Account was launched earlier this month, providing investors with an easy way to diversify their real estate investments. It’s now available to all registered investors, requiring only a minimum investment of $10.
With the launch of the Auto Investor Account, Groundfloor aims to make investing in real estate easier and more accessible for our investor community.
During the webinar, we had the opportunity to review and address some frequently asked questions. Here are some of the key inquiries that were discussed:
Can I set strategy goals or customize my Auto Investor Account?
If you want to guide your account based on different strategies you may have, we recommend using the Investor Account. The Auto Investor Account’s purpose is to simplify the process — and we deliberately make it easy where you put money in, and get your money out.
If you’re brand new to Groundfloor, have signed up for the Auto Investor Account, but decided you’d prefer to set your strategy and customize it, that’s an option too. Log in to Groundfloor from the web, using your Auto Investor log-in credentials. There, you’ll see an option to set up an Investor Account where you can set and customize your goals. You’ll also have a lot more control over how your investments get allocated.
Can I set the minimum/maximum amount to invest per investment?
Fine tuning how you want to allocate your investments is more aligned with the Investor Account. On the Investor Account, we have an auto invest feature and investment wizards there as well.
The Auto Investor Account is set up to be the easy option, so there are not any options to control how the algorithm works.
Is there a total limit I can invest?
You can invest as much money as you’d like. There’s no upper limit, just a minimum of $100. If you want to transfer a large amount, a good idea is to transfer funds over in separate chunks over several weeks. On any given week, there may be an average of 80 loans available, so this allows you to maximize diversification and invest in new loans as soon as they become available.
Can you explain repayments/payouts and how frequently they can be expected?
The first month, you’ll typically see a couple repayments come in and then they’ll start ramping up pretty quickly. In Chris’s example during the webinar, he mentioned he was getting steady repayments each week after having invested for around 7 months now in the Auto Investor Account.
If you compare the Auto Investor Account to one of the world’s largest private REITs, you would pay an enormous amount of fees.
For example:
Let’s say you have a Blackstone REIT. You’d have to pay 12.5% of any return over 5%. You’d also have to pay a 3.5% upfront load and a 2% annual fee. Whatever remaining amount you have gets repaid to you in a dividend, averaging around 4.5%. This means you’d make less on treasuries or a high-yield savings account.
What’s more is that REITs are managed by trusts. Those trusts can decide whether or not they redeem your shares and can choose to not pay out your redemption based on the number of investors wanting payouts.
However, with Groundfloor’s Auto Investor Account, you get repaid when we get repaid on one of the underlying loans we made to a real estate entrepreneur. Then it’s your decision. Do you want to reinvest it elsewhere? Do you want to pool up your cash using the cash target feature? You can withdraw as often as you’d like and can choose how you want to make use of your funds. You’ll get about 10–12x the monthly cash flow with a portfolio Groundfloor loans compared to what you’d get from even the best REIT in the world. Plus, you’ll get diversification without having to invest in an REIT.
Is the Auto Investor Account only available on the Groundfloor mobile app?
Right now, the Auto Investor Account is available on both mobile and desktop. If you have multiple Groundfloor accounts, you can log in on both, check your accounts, and transfer funds in and out.
However, our strategy with the Auto Investor Account is to leave it mobile, as it provides a better user experience. As we improve the product, you’ll see things show up on the app that you may not find on the web.
Is Two-Factor Authentication available on the Auto Investor Account?
Two-Factor Authentication (MFA) is now live through the mobile app. In order to turn it on within your Auto Investor Account, please take the following steps:
To learn more, please view our instructional video here.
What does “Regulatory Qualified” mean?
In the world of private alternative investing, you have two different offerings. One is real estate crowdfunding, which uses rules that require limiting the investments to those who are accredited.
The other offering is an issuer of securities, which have a set of rules called Regulation A. This is the type of offering Groundfloor uses.
Regulation A rules require that we disclose what the investments are, what the returns might be (or what they’ve been historically), and the different risk factors for each investment. We’re also required to file audited financials every year.
We’ve invested around 4 million in capital in roughly 4 years to achieve our qualification under Regular A. We also work with the Securities & Exchange Commission (SEC), which has verified our Regulation A qualification.
The SEC also ensures we’re continuously living up to the rules’ requirements by reviewing our offerings and giving regulatory oversight.
Describe how products like LROs, Notes, IRA, and Labs impact a user’s experience between the dual account experience.
Over time, Groundfloor has built up enough supply of investments, usually 60–100 loans distributed at any given time. Our main Investor Accounts allow you to pick and choose any loan you want through our helpful tools, Auto Investor and Investment Wizard.
This a great option if you’re an early adopter of auto investing and want to pick and choose loans while being actively engaged in the process. You’ll be able to get the yield and cash flow without doing all the work.
We’re always tinkering with new products as there’s a whole world of alternative real estate investment options out there. For example, Groundfloor Notes, a standard legacy investment account available on the web, is popular among our users.
We’re also constantly looking for new opportunities and categories of products to offer our users, like Labs by Groundfloor. Because it’s so expensive to go through the regulatory qualification process, Labs has limited access to a small segment of our user base (usually accredited investors or people who meet other tests within the rules). Our goal is to quickly figure out which products work best and can be scaled to the same level as Notes and loans.
Is the old platform merging in with the new?
The platforms will co-exist. The Auto Investor Account will be set for simplified, automatic investing, and the Investor Account will still be available for those who want a more strategic, hands-on approach.
How to get in touch with Groundfloor?
You can reach out to us at support@groundfloor.com
I am already a Groundfloor investor. Can I invite my friends to invest on the new platform?
Yes! We're always running a referral program. Check your Referral Program Tab in your Investor Account for further details.
To find your unique referral link, simply sign into your Groundfloor Investor Account and click on “Referral Program” in the dropdown menu in the upper right corner. The referral link will be there, ready for you to copy and/or share via email or social.