So You’ve Made It….

You have some decent income coming in or you’ve accumulated a large enough nest egg to attain the much desired title of Accredited Investor. Of course you are not one to simply sit on your laurels, you need to seek out opportunities for your income to grow and for your wealth to reach new heights. Well, let me tell you something awesome. There has never been a better time in history to match your Accredited Investor assets with appealing investment opportunities far and wide…largely thanks to the internet.

Below, I have broken down some of the best online investment platforms for Accredited Investors. This ranking is based on my personal experience as an investor, commentary from other accredited investors and background research aided by Broker Check and other risk management tools. Some of these investment platforms are brand new startups backed by experience and money. Others are long-established funds who are simply expanding their services with the aid of new web tools. And still others have narrowed their focus on very specific industries, taking the guesswork out of traditionally haphazard processes.

The following list is broken down by industry. Hope your excited. Let’s get started.

REAL ESTATE

The list of new online fintech tools that have opened in the past five years allowing you to invest substantial amounts of money in real estate is staggering. Here is but a small sample.

Investment Type: Real Estate
Minimum Investment: $5,000
Expected Returns: 4.5% — 8%

Started in 2012, RealtyMogul.com has the two-pronged goal of crowdfunding for Real Estate investment and offering portfolios of properties to invest in in the form of two REITs (Real Estate Investment Trusts). When you sign up on the platform, you will quickly see that individuals of all levels can invest in the REIT known as Mogul REIT I. The minimum investment amount is $1,000.00 and the REIT averages 8% annualized returns. At the time of this publishing, access to Realty Mogul’s second REIT, the Mogul REIT II is limited to Accredited Investors. The minimum invest amount is $5,000 and the REIT averages a 4.5% annualized return. The REIT II focuses on Multifamily properties while the REIT I is a much more diverse portfolio. Also, distributions for REIT I are monthly while distributions for REIT II are quarterly.

Investment Type: Real Estate
Minimum Investment: Average $5000, can go as low as $2,000
Expected Returns: 8% — 17%

Realty Shares was founded in 2013. Much like Realty Mogul, Realty Shares is a crowd funding platform. Unlike Realty Mogul, it is only open to accredited investors. Once you create an account, you are directed to a marketplace full of real estate properties for which Realty Shares is looking for financing. The types of properties ran the gamut from apartment blocks to franchise stores to self storage buildings. While I was invested on the site, I noticed that the average required investment was about $5,000. However, some properties were allowed to get a minimum investment of $2,000. Distributions from the properties ranged from as high as 13% to as low as 8%. I personally, invested in 2 properties. One apartment block in Brooklyn, NY and one in Boston, MA. ***Important Update: As of November 2018, Realty Shares failed to raise additional funds from investors. Therefore, they have (at least temporarily) closed down the marketplace for all investors. They are still actively managing the crowdfunded money they’ve already received.

Investment Type: Real Estate
Minimum Investment: $500 for started portfolio
Expected Returns: 7.0% — 10.5%

Washington D.C based Fundrise is actually one of the more experienced players in this field, having been founded in 2010. Fundrise takes a pure curated portfolio approach to allowing individual investors to get Real Estate into their portfolios. Here’s how it works. When you sign up on the platform you are asked to choose between 3 different portfolio types based on the degree of risk that you are willing to take on as the investor. The first portfolio is called “Supplemental Income”. Most returns in the portfolio come from dividend distributions and a smaller percentage comes from equity appreciation. On the other end of the spectrum is “Long Term Growth” portfolio which focuses on obtaining returns primarily from appreciation on the properties themselves. The last portfolio is called “Balanced Investing” and aims to achieve, you guessed it, a 50/50 split on contributions from appreciation and dividends. At the time of writing this article, returns from all the portfolio classes range from 7.0% to 10.5%

Investment Type: Real Estate
Minimum Investment: $50,000
Expected Returns: Depends on Portfolio, 9%-15%

Started by Private Equity veterans in 2007, Origin Investments is not simply for the Accredited Investor. It is for the investor with deep pockets who can afford to divest themselves of $50,000+ dollars for 5+ years. The investments are presented as funds on their website. The details behind each fund: the investment properties, the potential returns, the holding periods, etc are all freely posted.

There are of course more real estate platforms than what I listed above. Another popular site that I am not too familiar with is crowdstreet.com. Furthermore, numerous companies are now developing the ability to invest in real estate with the ease and convenience inherent to blockchain technology.

ENERGY

There are presently very few online platforms dedicated solely to to the energy sector. And honestly, most platforms in this space do not (yet) have a long history or solid track record. Therefore I am only highlighting two: Energyfunders and Citizenergy.

Investment Type: Energy
Minimum Investment: $5,000
Expected Returns: varies widely 30% — 60%

Operating out of Texas since 2013, Energy Funders seeks to democratize investment in oil and gas deposits in various parts of the U.S. Being a complete novice to this industry, I was extremely skeptical at first. However, after looking at some reviews, talking to their reps (and talking to someone who actually made a successful investment), I decided to jump on-board. After creating an account, you can choose from any oil and/or gas project they have on their platform (I have never seen more than 3 listed at any one time). At time of this article’s composition, you also have the option of investing in Energy Funders itself. Investment minimums seems to be in the $5,000 to $10,000 range. And it seems most of the money goes towards prospecting and feasibility testing of potential new wells/deposits. Moreover, if and when a well is found have potential (i.e. can be tapped); there is a 60 day lag time between when the well starts production and when you can expect to receive monthly distributions.

Yet, what truly motivated to finally invest was the potential of returns as high as 34%. Of course, this means there is a lot of risk involved. There are many reviews from people who have seen their investment disappear (I assume from a failed oil/gas project). But on the flip side there are quite a few who are making a mint. ***Note: The last bonus, they are the only platform I know of that definitely accepts bitcoin.

Investment Type: Energy
Minimum Investment: Depends on Portfolio/Investment
Expected Returns: varies widely

Founded in 2012 by three Portuguese entrepreneurs, Citizenergy’s stated goal is to encourage and execute cross-border investment in sustainable energy projects globally. The platform is not limited to accredited investors but does claims to carefully vet a number of funds, cooperatives, other crowdfunding platforms to ensure that the bulk of your investment is going to actual sustainable and renewable energy causes.

LITIGATION FINANCING

Litigation Financing has exploded in popularity over the past decade. The online platforms involved in this kind of financing vary slightly in their investment approaches. Also, overall minimum investment requirements seem to be going up. But based on my experience the returns can be very good.

Investment Type: Litigation Financing
Minimum Investment: $2,500
Expected Returns: varies by case, 30% — 60%

Lexshares is pretty unique in the online litigation financing space. Since its founding in 2014, it has allowed investors to invest in individual cases. The typical financing amounts required by each of these cases range between $100,000 and $1,000,000. Yet, you can invest as little as $2,500 per case. The platform is only open to accredited investors. However (and this is the primary reason I haven’t invested yet), investing in individual cases can be risky for a variety of reasons. First, if the plaintiff loses, your whole investment disappears. Second, even if the plaintiff wins, if the case drags on in the court systems for months and years; the management fees from Lexshares will start to really add up. Yet, to compensate for this higher risk; the ROI can approach 50%. One day I’ll try this one.

**Note: It it fair to mention that Lexshares claims that of all the requests for financing they receive, they only list 1% on their platform. (I.e. They do their best to choose the cases with the best chance of success.)

ALTERNATIVE INVESTMENTS

In a way, many of the above-mentioned investment categories fall under the broad category of “alternative investments”. Therefore, I really just created this category to highlight one specific company.

Investment Type: Alternative Investments
Minimum Investment: depends on project $5,000 — $50,000
Expected Returns: varies

Since 2014, the founders of Yieldstreet have sought to bring comprehensive alternative investment opportunities to a wider online. And as an active investor on the platform since late 2015, I can say that they have done an incredible job. The platform is exclusively for Accredited Investors, but the minimum investment amounts range anywhere from $5,000 to $50,000. And he ROI ranges from 8% to 20%.

However, true to their word, Yieldstreet is probably one of the best ways to diversity your investment portfolio across various asset classes. Not only does Yieldstreet’s marketplace include opportunities in Real Estate, Litigation Financing (extremely popular), Small Business Financing, Marine Financing; it even has the occasional investment opportunity in the energy sector. Moreover, Yieldstreet announced that a new class of investment asset will be added to the platform: Art Financing. Now that sounds exciting!