Luan Ha : Fundscraper Is Opening the Doors to a Whole New World of Wealth for the Everyday Investor

August 24, 2022

Fundscraper is opening the doors to a whole new world of wealth for the everyday investor.

Fundscraper is an online real estate investment marketplace that allows Canadian investors to participate in private real estate investing with as little as $5,000. We’re empowering investors to grow their wealth in a better, simpler and more transparent way.

Investors can choose from a wide array of select and vetted real estate offerings, including Mortgage Investment Corporations, Private REITs and Private Equity Real Estate Funds, to diversify their portfolios and to grow their wealth.

Fundscraper’s mission is to empower a broad range of Canadian investors in real estate backed securities.

Tell us about yourself?

I have a background in property development at Canada’s largest public real estate investment trust (REIT) in my prior life, and it made me realize private individuals aren’t able to invest in private real estate and utilize similar investment strategies of the pension funds or big institutional investors or well capitalized ultra high networth investors; so why not use technology to break down those barriers and truly allow private individuals the ability to diversify into real estate, the largest asset class, by helping individuals pool together their capital and invest together into projects they otherwise would not be able to invest on their own.

There are such unique attributes to real estate, stable cash flows, rental income, hard asset security, low correlation to public equities, scarcity coupled with supply challenges, inflation hedge, that you don’t get in other types of investments.

When we hear our clients speak about their real estate portfolios, I often hear a sprinkle of pride in what these clients have been able to build.

This is truly what makes real estate investing so impactful. Now, let’s add in the rigour, transparency, data and analytics, and streamlined processes to deliver a holistic investment experience!

Being able to diversify and build your portfolio like you would with stocks and bonds shouldn’t be so difficult and hard to reach nor expensive – so we try to make it available and easier for investors to access the appropriate opportunities that fit within their risk and return expectations, in relatively smaller increments compared to buying an entire building.

If you could go back in time a year or two, what piece of advice would you give yourself?

We’ve always taken an approach of sustainable and fundamental, intrinsic growth. Real estate investing is a long term value creation process, so too is our view on how we build the company in a disciplined strategic manner.

Looking back, I would tell myself to focus more on the highest value activities.

Being a two-sided online marketplace, in a highly regulated industry, you have to mix your priorities across very different spectrums of operational and strategic activities.

This impacts productivity for better or worse, and I would tell myself to simplify simplify simplify, then focus focus focus, then organize around that focus.

Everyone needs to be focused on the main thing at all times and that can only happen when you keep the main thing the main thing – through simplification and organization.

What problem does your business solve?

People have an inability to invest into larger private real estate investments so we provide an accessible marketplace, investment structure, and investment process that empowers them to grow their wealth by building a private portfolio of alternative real estate investments; instead of having to buy an entire property on their own.

We are providing liquidity to an otherwise very illiquid asset class.

We drive down that cost of capital using our technology and cost efficiencies, and provide a liquidity channel for marketplace incumbents by allowing qualified, private individuals / investors to pick and choose which assets they want to invest into.

Historically, investment minimums are very high and it’s expensive to invest. Even buying a property for a direct rental investment can cost you upwards of hundreds of thousands of dollars.

We make available a diverse selection of offerings that have lower minimum investment amounts and it helps individuals build their own passive portfolio, be in fixed income from debt based offerings such as mortgage investment entities, or a specific rental asset distributing rental income to client investors / unitholders.

What is the inspiration behind your business?

I come from the public, institutional, asset management and investment / development space and I learned unique insights from some of the biggest investors in real estate.

There is a unique knowledge base and skill set to be able to invest in real estate and there are structural market deficiencies in how an individual can go about executing on private real estate investment strategies.

The genesis of our business is to help private individuals learn about how and what to invest into alongside a community of like minded investors.

Using our technology, we want clients to be able to make informed decisions on how and what to invest into – it’s empowering investors with that unique knowledge base and trade craft coupled with transparency of risks and returns associated with investing.

Similar to how you can invest into stocks and mutual funds and ETFs online; we want to help the current and next generation of astute investors with private real estate investments, online.

Fixed income or equity based investments into real estate shouldn’t just be available to institutional investors. And it definitely should not only be an offline investment process! Land security has been a legal concept for at least 700 years, but let’s take real estate investing out of the middle ages and into the 21st century!

What is your magic sauce?

Fundscraper’s investment team brings diverse industry experience in real estate development, finance, private equity, law and technology. As a member, you’ll get a direct line to us. We’ll help you invest in private real estate with confidence.

Every asset on the marketplace is vetted through an 18-point checklist and approved by a credit committee with over $5 billion in combined transaction experience and decades of experience in real estate asset underwriting.

Extensive Selection – investors minimize risk by diversifying your portfolio with a broad class of real estate assets. There are so many real estate financing opportunities, and you get access to the cream of the crop, without the friction and hassles of a traditional real estate investing company.

What is the plan for the next 5 years? What do you want to achieve?

We are currently the largest online private real estate investment marketplaces in Canada, with offerings ranging from fixed income mortgage based investments to private REITs and other private equity limited partnership / development investments across North America. To date, we have helped place over $470M in capital into projects across North America.

Over the next five years, our goal is to make it the best performing marketplace, allowing investors to build meaningful allocations towards private real estate so they can hopefully retire more comfortably, and realize what I call the ‘Canadian Dream’.

The American Dream is known to be about buying your own home – I would say the Canadian Dream is instead about being able to have multiple investments in private real estate so you can have additional financial security coupled with hard asset security – this is what we are trying to help Canadians achieve.

[We are on track in the next 5 years to selectively placing over $1B into North American real estate by:

  • Expanding our selection of US based investment offerings.
  • Launching our mobile app to further help investors with insightful tools and analytics.
  • Partner and integrate with major distribution wealth management and financial advisory channels.
  • Become the lowest cost of capital provider of liquidity for proven third party issuers.
  • And ultimately, accelerate the adoption of real estate as a viable and more liquid alternative asset class to achieve greater diversification for investor portfolios.

What is the biggest challenge you’ve faced so far?

Nothing worthwhile is easy, but I never understood building a business and technology and investment marketplace would be this hard!

It’s a two sided marketplace so we are basically building 3 different businesses pretty much all at the same time.

The technology platform, the investment asset management platform, and the transaction/trading platform.

This goes back to the question of focus and simplification; something incredibly difficult to do in the context of our unique business!

Thankfully, the Canadian company building ecosystem and technology sector is well equipped to provide founders and companies support, so I’m super grateful we’re located in Toronto to be able to draw upon the clusters of available resources and experiences of our peers and fellow entrepreneurs.

How do people get involved/buy into your vision?

Whether you want to buy a single-family home or rental property, invest in office buildings, are considering buying an investment property, or have questions about real estate investment trusts (REITs), our team can help you understand your options.

Fundscraper allows investors with small amounts of capital to get in on private real estate deals. Whether you are looking for cash flow now or let your money sit and grow over the long term, Fundscraper offers a wide range of opportunities including Real Estate Investment Trusts, Private Equity, Mortgage Investment Corporations and Mutual Fund Trusts with shorter and longer term horizons.

We welcome you to create a free profile and browse our marketplace. If you’d like to discuss your financial goals and your options with one of our licensed dealing representatives, fill out this short questionnaire and book your call today.

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