Crowdfunding is opening up the UK property market. Increasingly popular as a means to raise investment, crowdfunding is now even funding multi-million pound property developments.Over the past few years there has been an enormous increase in private investment in businesses and projects through alternative finance platforms in the UK. Crowdfunding is big news. In fact, the alternative finance industry has grown from £267 million in 2012 to a staggering £4.85 billion in 2016 according to The Cambridge Centre of Alternative Finance. In 2016 2.5 million people invested, lent or donated via these platforms.
One industry that is embracing alternative finance and crowdfunding with particular enthusiasm is property, raising over £1.85 billion in 2016. So what exactly is crowdfunding and how does it work? We spoke to Atuksha Poonwassie, managing director and co-founder of Simple Crowdfunding.
“Crowdfunding means funding a project or business by raising money from a large number of people. There are three main types of crowdfunding: equity, where you buy shares in a company; loans (peer to peer lending), where you loan funds and rewards/donations, where individuals invest because they believe in a specific cause or product. The great thing about crowdfunding with us is that even with a modest budget anyone can invest in UK property and we facilitate the whole process in an open and transparent way.”
London property developer, Nicole Bremner has been an early adopter of crowdfunding, raising over £5.5 million over six projects through Simple Crowdfunding. She says,
“Crowdfunding has opened a new way of finance funding and investments. It allows a fundraiser to get in touch with a much wider investor community and to ensure their project is handled in a compliant way. Meanwhile investors have access to multiple property projects and an opportunity to invest as much as they wish into one or more from the comfort of their armchair.” With such a win-win strategy crowdfunding can only continue to grow in popularity.
Benefits
- Investors: Accessibility to the property marketplace
- Build your investment portfolio online
- Simple to invest
- Become part of a like-minded property community
- Fundraisers: Access to many investors
- Build a community that loves what you do
- Online investor management
- Managed through an FCA-authorised platform
‘Simple Crowdfunding’ statistics
- £1.55m raised in 17 minutes for a property
project in London - 49% Investors have seen returns of up to this percentage for an 18-month project
- 18-82 Investor age profile
- 2 to 86 Number of investors into a single project
About
Atuksha Poonwassie, managing director of Simple Crowdfunding Atuksha is a property investor and CRM geek. She first learnt about crowdfunding in early 2013 and launched her first platform (peer to peer lending platform) with her partner Davin Poonwassie later that year. They now offer equity projects and are approved ISA managers, allowing investors to invest using the ISA wrapper. Atuksha is also the 2017 ‘Venus Influential Woman of the Year’ and a director of the UK Crowdfunding Association.
Nicole Bremner, founder of East Eight Property Development
Nicole is an expert in property development, investment and crowdfunding. She is a director at two property companies based in the City and East London areas – East Eight (www.east-eight.com), which manages the funding for her projects, and London Central Developments, responsible for the development process. The company has around 12 projects worth over £120 million on the go. Nicole’s enthusiastic approach to crowdfunding has proved popular, and is now being adopted by others in the industry.
