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For David Behin, co-founder and CEO of CityFunders, proving real estate investment opportunities for accredited investors, his goal was to help bring real estate investing to the masses. Fast forward to now, and the pool of real estate investors has noticeably increased, with the passage of the JOBS Act, Title III. The new law contributes to CityFunders’ purpose: enabling the majority of people to invest in what was once only available to the elite.CityFunder
With a potential outpouring of money coming into the marketplace–Title III just received the SEC’s approval in October–David believes that regulation will beneficial for the industry. But Title III’s benefits are, of course, not limited to the real estate crowdfunding; Pensco Trust Company’s CEO believes Title III retail crowdfunding may benefit from IRA money retail crowdfunding may also benefit from IRA money. Steve Wallman last month shared his thoughts on Title III’s equity crowdfunding rules, informed by his background as a former SEC Commissioner.
Recently, Crowdfund Insider caught up with David about his thoughts on what the passage of Title III means for the future of real estate investing and crowdfunding.
Midori Yoshimura: Following the recent passage of Title III, how do you see regulation as benefiting the crowdfunding industry?
David Behin: The new regulations will vastly expand the number of eligible investors.
Midori: What do you see as the short-term and long-term effects of Title III?
David: I don’t expect much to happen in the short term, as these regulations won’t become actionable until mid-2016. Further down the line, I do expect increased regulatory involvement on the industry at large.
Midori: Given the expansion of eligible investors, how much of a bump might we expect to see in funding in the equity crowdfunding marketplace?
David: I think a significant bump will come, but it’s important to remember there will be a learning curve which will affect adoption. On the platform side, this consists of new processes and paperwork, as well as significant fees associated with opening portals up to non-accredited investors. Investors will have to research the different platforms and deals available to find what works best for them.
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