YELDO launches YELDO CROWD for retail investors

By Angelique Ruzicka

YELDO GROUP, a fintech company in the commercial real estate space, which has financed €450m worth of projects in Europe and Switzerland with a historical IRR (internal rate of return) of 14.7% and a 0% default rate, has launched YELDO CROWD - an equity crowdfunding platform that enables investors to access institutional-grade real estate investments.

YELDO CROWD is authorised by the Commissione Nazionale per le Società e la Borsa (CONSOB), the Italian securities market regulator.

Through YELDO and YELDO CROWD, YELDO GROUP is on a mission to democratize the real estate market by offering direct access to real estate investments, which has historically only been accessible to a few.

While YELDO caters to institutional investors and developers, YELDO CROWD offers solutions for retail investors and developers. As YELDO caters to professional investors the minimum investment is EUR 125k but YELDO CROWD’s investment minimum is far more accessible for retail investors at EUR 10k.

Here we unpack how YELDO CROWD works:

How does it work for investors?

YELDO CROWD is an online crowdfunding platform dedicated to real estate investing. Crowdfunding involves funding a project by raising money from a large number of people that can each invest a relatively small amount. Crowdfunding is typically conducted online and with YELDO CROWD the funds are collected through our website, which can be accessed by investors living anywhere in Europe.

Investors must register their profile by filling out a questionnaire and uploading various documents in order to comply with the MiFID (Markets in Financial Instruments Directive) regulation.

Once signed up, investors can access campaign details, evaluate deals and invest in development projects that are of interest.

There are rules about how much to invest to qualify for the deals. Investors must invest a minimum of EUR 10,000 in a SPV (Special Purpose Vehicle), i.e. a real estate ‘vehicle company’ set up to financially support a development project. There is no maximum threshold for investors.

What are the investment targets and fees?

YELDO CROWD enables investors to keep an eye on projects through periodic progress updates. Upon successful completion of the project, investors will be repaid their capital and the accrued yield.

Each crowdfunding campaign on YELDO CROWD has a minimum and maximum campaign target. With our first project (Firenze Via Chiusi), for instance, the minimum that must be reached before it gets transferred to the sponsor is EUR 2m.

Raised funds are wired to an escrow account. Only if the minimum target is hit, will the funds be transferred to the equity sponsor. If the minimum target is not reached the funds will be transferred back to the investors by the bank holding the escrow account (Banca Finint in our case).

The expected return on investment (ROI) and IRR vary on a project basis but with our first project the expected ROI is 18.6%, while the expected annual IRR is 12%.

Investors are also subject to paying an investment fee, which for YELDO CROWD is very competitively priced. The fees are decided on a project by project basis.

With YELDO CROWD’s first project, Firenze via Chiusi, investors must pay a 1% fee on any investment value up to EUR 50k, 0.5% on EUR51k -100k and 0.25% on investments higher than EUR 100k. Essentially, the more money you invest with YELDO CROWD, the less you pay in fees.

How does it work for developers?

YELDO CROWD enables real estate developers based in Europe to raise up to EUR8m in alternate funding, which will drop to EUR5m when new EU regulation comes into full effect.

It’s easy to submit an application online and, once approved on our platform, raising funds could take as little as 7-9 weeks.

The financial product is flexible and can be customized according to the developer's needs. There’s ongoing support from the YELDO CROWD team from the initial set up, through to the marketing campaigns and all the way to the completion of the project.

Find out more

Contact us through the YELDO CROWD website if you have any questions or want to know more about how it works. To find out more about current or new investment projects sign up for an account today.