- BrikkApp is a Czech aggregating platform for crowdfunding real estate investments.
- The platform is one of the first in the CEE region to allow modern and approachable access to passive income.
So far, crowdsourcing has been one of the unsung heroes of the Internet era.
Whether it’s what Kickstarter’s launch back in 2009 was able to do for the independent small to mid-tier market, or people crowdsourcing feedback to write a novel, or even something like Waze, exclusively relying on data sourced from its users.
I say “unsung” because while undeniably powerful and potent, it’s still something we see much more rarely than we should. I suspect we’ll be seeing a lot more of it in the near future as decentralized frameworks slowly become the new norm. For now, however, it’s sorely and obviously missing from a number of fields where it would potentially do the most good, like the financial market.
The Czech company BrikkApp is one of the first to try to bring crowdfunded passive income to Europe.
Founded back in 2019 in Prague, the company’s small-scale but focused team already has a lot to show for its efforts, by providing a number of tools meant to allow unparalleled access to the real estate market.
But what does real estate crowdfunding mean exactly?
The company’s CEO and Co-Founder, Jan Vecerka, explains: “Given that it is the safer and less volatile option compared to investing in the stock market, the extremely wealthy tend to choose property investment to increase their fortunes. Until rather recently, real estate investment wasn’t accessible to ordinary investors, as it was too expensive for them. Real estate crowdfunding has solved this problem by allowing individuals to pool their money together and divide the costs of investing in properties.”
BrikkApp’s platform provides access to detailed information on real estate crowdfunding investments, including project type, its projected return, and its duration. Generally, there is no standard term or yield for these type of investments, and they can vary from platform to platform
Investing in real estate has traditionally been seen as something with a higher bar of entry, due to its somewhat high risk, high entry fee, and its status as being an illiquid asset, but Jan claims that BrikkApp has found a solution to these problems, too.
It offers both high returns and a diversified portfolio to investors. Real estate crowdfunding enables investors to diversify their portfolios, investing in many different properties in different countries around the world. Therefore, it possesses a significantly smaller risk compared to other investment options. Also, investing through well-established online platforms, investors are not required to be involved in complicated property management work.
“Risk analysis is crucial for us. Our goal is to provide our users with as much transparent data as possible to be able to compare platforms and investment opportunities to make an informed investment decision. We are building our solution as a tool to enable real estate crowdfunding platforms to cooperate. This is going to solve all these issues – increased liquidity with liquid secondary trading, improved risk management and reduced fees.”
According to the company’s CEO, BrikkApp has a particular approach when it comes to positioning itself in the market.
For one, BrikkApp strives to be an industry leader by bringing transparency to the property crowdfunding market as a whole. The company has had two years to refine its meticulous and persistent data research and collection process and is already providing a more complete picture of the industry for everyone who wants to find their best investment opportunities.
Secondly, BrikkApp has aimed to be an educational platform as well. The real estate crowdfunding market is relatively young, so most people aren’t as familiar with the process as they might be with the concept itself.
“As we aim to bring real estate investment to all, the first step is helping people understand how they can get started. And following that, how they can continue to diversify and grow their portfolio.”
And finally, BrikkApp is building a marketplace aimed at providing people the ability to find and compare investment opportunities worldwide, to be able to invest in multiple different projects from multiple different platforms, and be able to view them all in one simple dashboard.
“The idea of crowdlending is very simple – to bring investor with borrower together. Crowdlending projects bring infrastructural, economic and environmental growth. We think that the potential for this industry is huge especially when the market will be licensed. Crowdlending is an investment option, which offers an impressive interest rate – up to 12%. It is a great alternative to more traditional investment options and allows portfolio diversification.”
Nikita claims that the market’s high demand for loans is mainly due to the fact that it’s harder to apply and get a loan from a bank. Crowdlending platforms are more flexible in their ability to make decisions and in their approach to the evaluation process.
For their part, LendSecured evaluates every client strictly and has an acceptance rate of around 6%. Their team has 10 years of experience in the mortgage lending and real estate market, providing a platform that brings borrowers and lenders straight to each other.
Nikita adds, “On LendSecured you can mainly find real estate and agricultural loans with low LTV, which are backed with a first rank mortgage. Starting from March 1st we are launching a new product – seasonal funding for farmers (grain financing). As you know BrikkApp brings all the crowdlending platforms in one place as an aggregator and share summary about each of them, making investor’s decision easier.”
As far as the future goes, both companies agree that the industry is just beginning to flourish.
Nikita believes that there will be a continuing rise in the number of aggregating platforms like BrikkApp, creating tools that improve diversification. This will, in turn, allow real estate platforms like LendSecured to spend more time finding and publishing attractive new investment projects.
Finally, Jan adds that, “BrikkApp has big plans for the coming years: hosting even more platforms’ projects from all over the world on our marketplace as we continue to expand and grow along with the REC industry as a whole. Continuing to educate people on the benefits of smart investing, property crowdfunding, diversification, and more. Because the goal of making real estate investment achievable for all requires a 24/7, 365 type of effort. Eventually expanding our focus beyond Europe and into the American market.”
As far as I’m personally concerned, Europe is still lagging behind when it comes personal finance tools, particularly ones that provide passive income to the individual.
The company’s approach to educating its users and mitigating risk also lends significant credence to the that BrikkApp wants to bring benefit to its users by building a robust and reliable platform for real estate investments.
For all the progress societies make, it’s technologies and platforms like this one that promises to decentralize the average person’s access to the resources needed to follow their dreams.