On Thursday, March 28, ACG National Capital hosted the 25th annual Mid-Atlantic Growth Conference. As in previous years, the conference was a great opportunity for ACG members and their guests to network with and learn from the east coast’s leading business people and corporate growth professionals.

Among the speakers and presenters at this year’s conference was Ben Miller, the co-founder of Fundrise, a company that is revolutionizing and democratizing real estate investment. Fundrise is the world’s first electronic real estate investment trust (eREIT).

Real estate remains one of the most profitable and best-performing assets that most investors have in their portfolios. Unfortunately, much of the real estate investment is done by large, institutional investment firms that make real estate investment out of reach for the average investor. Unlike a traditional REIT, Fundrise allows the “crowdfunding” of real estate from a large number of individual investors as opposed to a smaller handful of larger institutional real estate investment firms – making it possible for the average investor to add real estate to their investment portfolio.

As Ben tells it, the eREIT concept behind Fundrise is something “old made new again” – a means to curry investment dollars from sources outside of the private equity institutions and high-net worth individuals. “The institutionalization of real estate is actually a relatively new thing,” Ben told Laura Dietzel, Senior Manager, Real Estate Senior Analyst at RSM, during their fireside chat at the Mid-Atlantic Growth Conference. “I started Fundrise after the 2008 financial crisis, when institutional investors were bankrupt, running for the hills, absolutely not prepared for what happened.”

Into this scene entered Fundrise and its eREIT platform, which took advantage of traditional real estate investors’ reticence to spend and changes in government regulation to tap into new pools of capital.

“It’s a different customer base than a traditional real estate [investment firm] or really any traditional finance institution,” Mr. Miller said of Fundrise’s customers, most of whom navigate the company’s offerings via mobile app. Since all you need to invest on Fundrise is capital and access to their app, one can gather capital more efficiently than you would be able to with a traditional approach through institutional investors,

But the benefits of Fundrise could extend beyond democratizing real estate investment. Ben believes that services like Fundrise could play a role in overcoming what he refers to as, “the next economic crisis.”

According to Ben, “The primary sources of capital…behind every financial institution – with perhaps the exceptions of retirement and index funds – are people over 65.” Ben warns that – just as the next generation doesn’t shop or communicate the same way as the last generation – this next generation of investors may not invest the same way as their predecessors. “There’s a presumption that as demographics shift [towards new generations of investors], those demographics will invest in the same way,” Ben said.  “And they won’t.”

Just like how tech-savvy members of Gen X and millennials use mobile banking, online shopping, and ride hailing apps every day, a mobile-based vehicle for real estate investing like Fundrise could offer a way to adapt the investor experience towards that next generations of investors.

While Fundrise is an excellent idea that could have huge ramifications on investing in the near and long term, it only can exist thanks to recent regulatory and legislative changes. Reforms in Regulation A+ in 2012’s JOBS Act allowed private companies to raise up to $50 Million from the public. This opened the door for the company’s real estate crowdfunding business model.

Fundrise is more than an example of how technology is enabling new investment opportunities and democratizing investment opportunities that were previously only available to the select few. It’s also an incredible example of how shifting regulatory and legislative environments can create opportunities for innovation and investment where they didn’t exist before.

For additional information about Fundrise and its innovative real estate investment platform visit them online at: https://fundrise.com/