Assess their risks, liquidity, investments, returns, timeframes and other terms
Invest in single-family homes
Invest in startups in exchange for equity
The minimum investment on Doorvest is a 25% down payment on a home, averaging $56,250 based on the average home price of $225,000.
The standard minimum investment on Wefunder for most Community Rounds is $100. However, the exact minimum can vary based on the specific offering and the investor's status as an accredited investor.
Investing with Doorvest involves risks such as market volatility, economic changes, and property-specific issues. While the platform aims to manage these effectively, outcomes can be uncertain, and investors should carefully consider their risk tolerance and conduct due diligence before investing.
Investing in startups on Wefunder is highly risky, and there's a real possibility of losing your entire investment.
Doorvest allows investors to sell their homes back to the platform, requiring them to connect with a client partner for more information on the process.
Wefunder's investments are not highly liquid, as there is no public market for selling your stake. After one year, you can sell to any interested buyer.
Doorvest reports an average annual investment return of 18%, accounting for rental income, property appreciation, and mortgage leveraging.
On Wefunder, investors can earn returns through different investment mechanisms: Debt, Convertibles Stock (No Dividends), Stock, Dividends. Investment returns on Wefunder vary by investment type, with dividends more typical in later-stage, non-tech businesses.
Doorvest focuses on long-term investments in single-family rentals, generally suggesting a commitment of several years to decades, based on real estate appreciation and rental income.
Investments on Wefunder are long-term, with an average return period of around seven years, particularly for convertible notes or SAFEs.
To invest with Doorvest, you need to be in the U.S. or able to sign documents at a U.S. Embassy.
Individuals 18 and older can invest on Wefunder, regardless of whether they are accredited or non-accredited investors. Additionally, Wefunder allows investments through entities.
Real estate assets on Doorvest can experience volatility due to economic shifts, interest rate changes, and local market trends, potentially affecting investment values and posing risks for short-term investors.
The assets on Wefunder, primarily startups and small businesses, are highly volatile due to the uncertain success of these ventures and fluctuating market conditions.
Doorvest complies with the Texas Real Estate Commission (TREC) consumer protection notice, indicating adherence to state-level real estate transaction standards. It does not provide details on broader financial regulations or audits, focusing more on real estate industry compliance than securities regulation.
Wefunder is regulated by the SEC and FINRA under Regulation Crowdfunding (Reg CF), requiring it to adhere to strict rules about investment limits, company fundraising, and disclosures.
Doorvest protects rental investments with homeowner's insurance, covering physical structure damage and potentially extending to personal belongings and medical expenses. This coverage is a mortgage lender requirement, safeguarding against various damages, though investors should be aware of any coverage limitations.
Doorvest offers rental income as returns to investors, bolstered by a Rent Guarantee that includes vacancy and non-payment protection for the first three months, with an option to extend up to 12 months. Additionally, a Renovation Guarantee covers repair costs for the first year of ownership.
Wefunder investments typically do not offer dividends, as they are often in early-stage startups focusing on growth.
To get their money back, Doorvest investors need to sell their property, with the timeline depending on market conditions and the sale process. The process is initiated through Doorvest, and funds are received after the property is sold and the transaction is completed.
On Wefunder, investors primarily see returns from liquidity events like acquisitions or IPOs, where investments may convert to cash or shares. After the first year, shares can be sold to any interested buyer, with Wefunder facilitating the transfer process. For debt investments or revenue shares, returns follow the agreed terms, like fixed repayments or revenue-based payouts.
Doorvest employs a fee model, deriving revenue from a portion of the monthly rental income and margins on home sales, always at fair market value.
Wefunder charges a one-time transaction fee of 2% for bank payments and 5.5% for credit card payments. For WeFunds, an administrative fee covers lifetime costs like filings and accounting, with no additional contributions required from investors.
Doorvest facilitates tax compliance by providing investors with all necessary documentation for tax filing, related to real estate investment income and expenses.
Wefunder supports tax reporting for investors by providing Schedule K-1 forms for those invested through LLCs or SPVs, detailing taxable gains or losses. For investments receiving payments, such as revenue shares, Form 1099 may be issued to report income.