When deciding where to invest, financial experts will often advise you to “get to know yourself.” This includes knowing how much money one has available to invest, what the time frame for returns is and how hands-on he or she wants to be in movement and growth of his or her money. Consider this as building a relationship with one’s money. Along those same lines, the successful investor also takes the time to select investments that they are interested in learning more about and will be intellectually and financially rewarding. Indeed, it is rare that people fund projects or companies that don’t interest them. People care about how that investment plays out—not just in terms of the return on investment, but also the success of the project or company. Now, with crowdfunding, that means that multiple people with these same feelings are all investing in the same thing.
Crowdfunding pools like-minded individuals to invest in a project or company. When one invests with his peers, it is hard not to identify with them. This is an example of how crowdfunding can be the catalyst for community growth and development. The first step in growing a community is joining forces to achieve a common goal. With Loquidity, people are now able to invest in real estate in their own town, city or neighborhood. The growth in real estate is coupled with a growth in commercial development.
This is called “local vesting”—rebuilding communities by investing within 50 miles of where one lives—which strengthens bonds between local businesses and residents. When one invests in his community, he gets involved and stays engaged with its progress. The investor genuinely wants his community to grow because when it does, his investment becomes more lucrative. While he is making fundamentally sound investments, he is also rebuilding his community, which stimulates the local, and potentially national, economy. Through our platform, accredited and unaccredited* investors can invest with low minimums in a project, which allows for more people to fund a single development, thus creating a stronger sense of community.
Let’s imagine that John uses his car only when he drives across town to get groceries. Acquiring some Whole Foods stock will not help John build more infrastructure within his neighborhood. If John invests in real estate developments, via crowdfunding, he can increase the demand for essentials to be provided near his home. He can create the demand to help bring those much-needed local grocers or beloved pizzerias to his neighborhood. Not only does John benefit from the return on investment, but he is also happily taking advantage of the perks that accompany it.
When parts of town are developed (or redeveloped), jobs are created, which, in turn, stimulates community growth. People want to be where the action is, and inevitably, it is the latest and greatest thing on the block that attracts everyone. This can also lead to the expansion of public transportation, which also helps kickstart the local economy.
Through local vesting and crowdfunding, individuals are able to have a hand in the community’s future as well as their own. Investors can do everything from helping to bring the types of businesses they want to their neighborhoods and revamping Main Street to creating job opportunities and more places to live.
*Unaccredited investors can currently invest in projects that are only offered under specific state crowdfunding exemptions, such as Michigan, Wisconsin, Indiana, Kansas, etc. and must be residents of such state.