YieldTalk #36: Informed Investment Crowdfunding

Hello Reader,

This week: Get a yield bump from EquityMultiple; 2 new litigation finance offerings; WTF is an NFT?

🌟 Special offer for YieldTalk subscribers 🌟

My first equity investment in crowdfunded real estate was through EquityMultiple, and last year we posted a great interview with Charles Clinton, the founder and CEO. For a limited time, EquityMultiple is offering YieldTalk subscribers a 1% yield boost on their first investment. Just sign up for an account using this link 👈.

Notable Offerings

YieldStreet (our review) is opening up their Legal Finance Fund I. Accredited investors only, minimum investment is on the high side at $40K:

The Fund intends to seek investments that will enable it to provide target annualized returns of 11% - 13% to investors through the life of the Fund, although returns may be higher or lower than the target range. Returns and cash flows to the Fund will be event-based and coincide with the conclusion of each underlying legal case. At launch, the Fund will have one initial insured portfolio of lawsuits, but is expecting to invest in additional opportunities. The Fund has an initial remaining life of up to 47 months with the option of one 12-month extension.

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Speaking of litigation finance, LexShares (our review) is opening up a new breach-of-contract investment tomorrow (Friday) at 1:00 PM ET. Accredited investors only.

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Invest in an indoor salmon farm in upstate New York via Harvest Returns (our review):

Finger Lakes Fish, Inc., DBA LocalCoho, a New York based indoor salmon farm. Unlike most fish farming operations, LocalCoho utilizes a recirculating aquaculture system, which allows the harvester to operate in a controlled indoor system, free of antibiotics and chemicals. This method is considered to be much more sustainable than open-net pen operations, which are exposed to the risks of disease, pollution, changes in climate, and are often detrimental to the surrounding environment.

The minimum investment is $20K, and open only to accredited investors.

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​Two offerings from impact platform SmallChange (our review) are open to anyone over 18, with a $1,000 minimum investment:

A Portland-based, turnkey ADU project that wants to use ground leases to provide a needed housing solution at no upfront cost to homeowners. And a Newark-based, affordable housing project that wants to help turn renters into homeowners.

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Via Mythic Markets (our review) you can own a piece of a 1987 Metroid cartridge for the original Nintendo Entertainment System (NES). Open to all investors, $25 minimum.

Worth Reading this Week

Wefunder (our review) has issued an "Impact Report" detailing their results since 2012. Highlight numbers include:$235M raised by almost 1,500 founders; 912,000 investors, with a median investment of $250.

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Equity Crowdfunding is on the rise, but so is fundraising for startups overall, with Carta reporting a record amount raised in Q4 2020.

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This piece about words and phrases to avoid in a VC pitch deck is also quite helpful from the investor perspective, providing a handy list of red flags to watch for in your own analysis.

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One of the reasons to diversify into alternative investments is to insulate at least some of your portfolio from the ups and downs of the stock market. But the market (and the wider economy) still matters, so if you're on "bubble watch" this piece from The Capital Spectator provides a quick look at several bubble indicators, including Robert Shiller's cyclically adjusted price-earnings multiple (CAPE) index and Ray Dalio's "aggregate bubble gauge".

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I'm a sucker for thinkpieces (usually published on Medium) that apply a historical lens to technological and financial innovation. This one on Bitcoin clocks in as a 35-minute read, but it's quite entertaining (though know the author is quite clearly very bullish on crypto).

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Speaking of crypto and long-form thinkpieces (and possibly bubbles too...), this one will get you up to speed on the crypto acronym du jour, "NFT", which stands for "non-fungible token". It's a mechanism for creating a unique digital artifact whose authenticity can be verified via a distributed ledger (aka a "blockchain"), similar to how Bitcoin ownership and transactions are recorded.

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Speaking of NFTs (and definitely bubbles...) Alex Danco makes the case that even if a lot of what's happening with NFTs right now will deflate, the flood of capital and attention is laying the groundwork for a lot of important future innovation:

I think it makes more sense to think of NFTs not as a product, or as a technology, but as a gathering point; like a part of the CBGBs floor plan. This current burst of speculative interest around owning LeBron dunks or whatever is really cool, don’t get me wrong. But it’ll conclude, at some point, in its current form. But something really important got created in the meantime, which is a shared understanding and a common gathering point for creatives and developers who want to creatively represent digital scarcity, for any use case now.

Odds and Ends

• Blockfi (our review) is launching a Bitcoin rewards credit card (earn 1.5% worth of BTC back on your purchases) . Sign up for the waiting list here.
• ​Roofstock (our review) announced they've acquired Stessa, a provider of finance and accounting software for rental property owners.
• If you can't decide whether to invest in gold or cryptocurrency, it turns out there's a cryptocurrency backed by physical gold. (If you want to invest in actual gold, there's an app for that.)
• Following an acquisition last year, CrowdfundNC has rebranded as Incolo​

Before you go ...

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Want to learn more about investment crowdfunding but aren’t sure where to start? You can explore more than 120 crowdfunding investment platforms in our database and learn more about the nuts and bolts of crowdfunding and alternative investing on our blog. Stay safe and healthy out there! 😷