Thank you for joining us at the new Groundfloor, an innovative and revolutionary method of investing in real estate. Groundfloor is an acclaimed investment technology platform that has successfully facilitated over $1 billion in investments, establishing a remarkable track record. Today, we are thrilled to announce the launch of Groundfloor 3.0, the future of real estate investment.
Since our establishment in 2013, Groundfloor has consistently delivered impressive returns, offering annualized returns of 10%. This remarkable achievement is a testament to our unwavering commitment to excellence and our dedication to providing unparalleled opportunities for our investors.
Groundfloor 3.0 is the result of a decade of insights gathered from our vibrant community of over 240,000 passionate investors. This latest-generation investing platform, known as the "Auto Investor Account," has been designed to cater to the needs of the mass market, redefining the investing experience.
We are delighted to open up access to private real estate debt investments for everyone, regardless of whether you are a seasoned pro or a brand new investor. We understand the importance of providing a comprehensive and user-friendly platform, and that's why we thought it would be helpful to provide you with an overview of our platform, how it works, and how to get started investing.
By joining us at Groundfloor, you are embarking on an exciting journey filled with unlimited possibilities in the real estate industry. We are thrilled to have you as part of our community, and we look forward to helping you achieve your investment goals.
Welcome to Groundfloor 3.0, where innovative real estate investment opportunities await.
What is Groundfloor: A Brief Overview
Groundfloor is a first-of-its-kind investment platform for everyday investors that gives both accredited and non-accredited investors direct access to short-term, high yield returns backed by real estate. Our platform empowers investors like you to add fractional shares of private real estate investments into your investing portfolio on your terms, without having to go through a preexisting REIT or fund. We believe you should have the ultimate say in which projects to invest in and how much to invest in each project, meaning your portfolio can be completely tailored to your own unique financial situation and risk tolerance. Best of all, our low investment minimum of $10 it easy to try the platform out, giving you the power to easily diversify your portfolio with an automatic investing experience.
Our returns are powered by venture loans to real estate entrepreneurs, originated and serviced by Groundfloor. These real estate entrepreneurs (called “borrowers”) apply for financing for their real estate projects through Groundfloor. We then combine rigorous third-party reporting and analysis of the proposed project with our 100+ years of collective real estate experience to accept and underwrite the project. The loan is then passed through our loan grading algorithm, which assigns a letter grade “A” through “G” to the loan to denote the relative risk level. Each grade corresponds to a range of interest rates that properly price the risk. Grade A loans are generally low-risk and offer correspondingly lower returns, while Grade G loans provide higher returns in exchange for increased risk. Once the loan has been assigned a rate and letter grade, Groundfloor closes and funds the loan.
Once loans are funded, Groundfloor creates investment securities (Limited Recourse Obligations, or LROs) based on the loans and files them for qualification with the U.S. Securities & Exchange Commission (SEC). Investments are released on our platform for individual investors to invest in on a fractional basis, with as little as $10. Once the loan is repaid to Groundfloor, investors in the corresponding LRO receive principal and interest repayments, which they can withdraw at any time or auto invest into more LROs.
Groundfloor: Now with Two Investing Experiences
Groundfloor offers two distinct investing experiences tailored to meet the preferences of investors. For individuals seeking a personalized approach, Groundfloor's legacy "Investor Accounts" deliver a comprehensive set of customizable tools meticulously crafted to align with your unique risk tolerance. These tools encompass a wide array of options, including LROs (Limited Recourse Obligations), Notes, and Labs, enabling you to curate an investment portfolio that truly reflects your financial goals and aspirations.
On the other hand, Groundfloor 3.0 places an emphasis on simplicity, streamlining the investing experience for maximum convenience. By prioritizing diversification and ease of use, your funds are automatically diversified across all available LRO loans, starting from as little as $1. This seamless process ensures that your investment is spread across multiple opportunities, mitigating risk and enhancing potential returns.
Getting Started: Download the app, Linking Your Account And Your First Funds Transfer
You’re on your way to enjoy real estate investing on-the-go, ensuring steady cash flows and effortless investment tracking. To get started investing, you must first create an investor account and connect your bank account. Here is what the initial steps of this process looks like:
First, you will need to provide some basic information to setup your account.
Next, you will be asked to add a funding source for your account. You have the option of instantly linking your bank account via Plaid, or manually entering your bank account information.
Groundfloor works like an online brokerage, as you deposit funds via transfer from your bank account. Deposits may take three to five business days to appear in your Investor Account. Once deposited, the funds are held in your name (not Groundfloor's) and are FDIC-insured until invested.
In addition to transferring funds in as you go, you can also set up an automatic funds transfer schedule to ensure you are ready to invest whenever new loans are released on the platform:
Groundfloor also offers several features that you can take advantage of to help further your investing strategies. Looking to only invest in loans that have certain letter grades or are in certain locations? The Investment Wizard is a tool that automatically matches available loans with investment criteria you can select and customize, making it easier to invest in the loans you want in just a few clicks. Prefer to set it and forget it? Our new Automatic Investing feature allows you to allocate specific dollar amounts that will automatically fund projects that match your risk tolerance, ensuring your funds are continuously being put to work without the need to actively login and invest. Want to invest in your retirement? Take advantage of the high yield Groundfloor LROs can provide while allowing your money to grow tax-deferred or tax-free through a Groundfloor self-directed IRA.
Investing: Our Loans, Grades, Rates, Terms, and Payment Structures
As previously stated, our team directly originates all the loans offered for investment on Groundfloor. We handle the initial application, conduct background and credit checks, review valuation reports and feasibility studies from third-party providers, and evaluate the borrower's renovation plan to assess the project's likelihood of success. Once we are satisfied, we pre-fund the loan with our own capital to initiate the work, while also ensuring compliance with the regulatory disclosure review process conducted by the U.S. Securities & Exchange Commission (SEC). Most loans provide yields ranging from 7.5% to 14%, with terms spanning from 6 to 12 months. For a visual representation of our grading system on the available investments page,
Unlike many other hard money lenders in our space, Groundfloor offers real estate developers a unique deferred payment loan product. With a deferred payment loan structure, borrowers defer all interest payments until the end of the loan term; correspondingly, investors receive repayments of principal and interest in one lump sum at the end of the loan term.
Investor Updates And Repayment
Throughout the duration of the loan term, our dedicated and experienced Asset Management team proactively monitors the progress of each individual project, diligently processing draw requests against the loan balance. We work closely with borrowers to swiftly resolve any issues that may arise, ensuring a seamless and efficient process.
Moreover, we understand the importance of keeping our valued investors well-informed. That's why our team consistently provides timely updates, ensuring transparency and giving investors peace of mind regarding the status of their investments. We go above and beyond to maintain high investor satisfaction, which is at the forefront of our priorities.
As an added measure, Groundfloor takes pride in publishing a comprehensive monthly report on loan repayments and asset management activities on our blog. These reports offer investors valuable insights, empowering them to gain a deeper understanding of the performance and progress of their investments. Our commitment to transparency is a unique feature of our lending and investing platform.
Rest assured, we are fully dedicated to managing your investments with utmost care and ensuring that you have all the information you need to make informed decisions. Your success is our success, and we are here every step of the way to support you on your investment journey.
Now, the thing we’ve all been waiting for: getting paid.
One notable characteristic that sets Groundfloor apart is its relatively short holding period compared to other investments. The majority of Groundfloor loans have terms of fewer than 12 months, ensuring a faster return on investment. Occasionally, loans may encounter challenges, either due to the need for additional time to complete property renovations, sell or refinance the property, and repay the loan (referred to as an "extension"), or as a result of our team initiating legal action against the borrower (known as a "default"). For detailed insights into the frequency and performance of such occurrences, you can refer to our blog, which regularly publishes analyses of loan performance, as well as our ongoing monthly regulatory filings.
After a borrower successfully sells or refinances the rehabilitated property, the principal repayment is promptly initiated. Once the funds are collected by Groundfloor, our platform automatically issues the repayment to our valued investors. Rest assured, you will receive a comprehensive email notification notifying you about the repayment, providing you with the flexibility to either reinvest your funds into a new loan opportunity or withdraw them. Moreover, we offer the convenience of monitoring your account status and performance through our user-friendly Investor Dashboard, giving you real-time insights on your investment journey.
And there you have it: a quick, end-to-end overview on how investing with Groundfloor works. For more in-depth information and answers, please visit our FAQ page or contact us anytime by email at support@groundfloor.us.
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