Hardly a month goes by without a real estate crowdfunding startup getting big bucks from investors. Long Island-based Sharestates just became the latest, with an expected commitment of $30 million from an affiliate of Ranger Capital Group.
The money will not go to the startup itself, but to real estate projects listed on Sharestates’ platform. In essence, it will complement the money Sharestates raises from small-time investors. Ranger, a Texas-based investment firm, plans on investing the money through its direct lending fund in residential, commercial and mixed-use properties in New York throughout the rest of the year, according to a news release.
“In our view, Sharestates is one of the most promising real estate platforms in the direct lending industry. We are excited to have them as a partner moving forward,” said Bill Kassul, partner in the Ranger Direct Lending Fund.
Founded in 2013 by Allen Shayanfekr, Radni Davoodi and Raymond Davoodi, Sharestates focuses on financing fix-and-flip loans with an average value of $350,000. So far, the firm claims to have raised a total of $4.5 million for 13 projects. Ranger’s money could allow the startup to dramatically expand its business and compete with larger rivals such as Fundrise or Patch of Land.
Sharestates isn’t the first crowdfunding platform to turn to an investment fund to finance its projects. For example, California-based Patch of Land claimed to have secured a commitment from an unnamed hedge fund in 2014 to invest up to $25 million per month.
“It is truly a transformational deal for Sharestates, and a relationship we trust will only grow over time,” said Allen Shayanfekr, CEO of Sharestates.