Alternative financing for the real estate market in Spain is becoming increasingly popular. Within this segment, crowdfunding is beginning to be implemented strongly in the country and is becoming another way of attracting money for real estate companies and developers.
Discover the world’s most interesting financial news with the Born2Invest mobile app. The app provides its readers with access to the latest news in the stock market, finance, global business, and trending topics like bitcoin, cryptocurrency, and crowdfunding.
The StockCrowd startup
The StockCrowd startup is one of the companies responsible for the consolidation of collective financing among real estate firms thanks to the development of software that allows companies to carry out crowdfunding campaigns from their own website, thus eliminating any intermediary. “You could say we are the decentralization of crowdfunding. Any organization in the world, through our cloud software and from their own website, can raise money for their projects, without going through a platform or competing in a showcase,” explained Sergi Pallarès, CEO of StockCrowd.
The company was born at the end of 2015 and “the first client was obtained in October 2016,” said the manager. In 2017 the startup had a turnover of $75.000 (€70.000) from six clients, in 2018 it had a turnover of $324.000 (€300.000) from 30 clients and it was “in 2019 when we really took off, with a turnover of one million euros from more than 130 clients”, said Pallarès, who pointed out that this year the objective is to double these figures with “two million income and 300 clients.”
“We work with a profile of a medium company in terms of asset management volume, but we are already beginning to be approached by really big real estate and development companies,” says the founder of StockCrowd, who details that the first fundraising campaigns were an average of $129.000 (€120.000) and now they are already $432.000 (€400.000).
“We currently have financing projects of more than one million euros on the table,” he points out. Throughout last year, its software moved $6.1 million (€5.7 million) in the real estate sector and its goal is to reach $18.3 million (€17 million) in 2020.
The rise of this model
“In the financial sector there is a clear concentration and credit is what it is. What we see is that there are certain companies that have reached the credit limit with the banks and need to look for alternatives,” Pallarès pointed out.
Moreover, on the investor side, the attraction of this collaborative formula lies in the high returns it offers. Of the 34 projects that are currently active on its website, the estimated average return is 9.7%, although there are specific developments that offer more than 18%.
Database for investors
“Our tool, in the end, allows the developer to create its own database of investors, that is the key,” the manager pointed out that “the average outlay in alternative investment in the sector is below $3.200 (€3.000), while our average ticket is $11.300 (€10.500). We have a more sophisticated model than that of a traditional platform.”
To start the project, Pallarès, together with his partner Javier Villacampa, raised $1.1 million(€1 million). In 2018, they opened another round in which they raised $3.7 million (€3.5 million), which gave entry to Asian capital. Now the firm has opened another process to raise $3.7 million (€3 million), with which to grow internationally.
DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.
This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.
First published in elEconomista.es, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.
Corona crisis causes cannabis prices to soar in Berlin
The ban and exit restrictions in Germany are taking effect in stopping the coronavirus pandemic. However, the pressure to prosecute...
Biotech company Evotec is showing strong performance on the stock market
Evotec shares are showing a strong performance, as the price increased by 5.15% this week. The company is expanding its...
The private sector in Algeria on the verge of disaster
The combined effects of the Hirak Movement and the Covid-19 health crisis make companies in Algeria fear the worst in...
AscensionX launched a crowdfunding campaign to build an artificial respirator
The four professionals behind the 3D electronics, modeling and printing studio AscensionX, in Longueuil, wanted to put their skills to...
Public and private collaboration will be the norm as COVID-19 is contained
To reset the economy in 2020, trillions of dollars will be sent to state and local governmental entities. Congress is...
Featured4 days ago
The corona crisis increases demand for loan via Fintech platforms
Featured5 days ago
The Italian FinTech sector is rapidly evolving
Business5 days ago
3 business intelligence trends to watch for in 2020
Biotech6 days ago
Genfit is adapting its activities in accordance to the coronavirus pandemic