Property developers and builders require lenders and investors to raise capital. This capital can be raised in the form of senior debt finance, mezzanine finance, equity finance, 100 per cent development finance and so on. In the earlier days, to secure capital, builders and developers had to go from lender to lender and approach multiple investors before securing capital. Of course, this process was long and tedious. Now, as technology has advanced, property developers can raise funds with the help of online tools. This is because there are so many websites and platforms and online advertising and marketing tools, which help builders and developers find potential investors and lenders easily. Here is how property developers can raise funds and capital with the help of online tools.
Finding investors and lenders online
Using lending platforms to find potential investors is probably the most common online finance raising tool for property developers. Various websites and platforms have come about in recent years that are solely dedicated to securing finance and capital for developers. Sqft Capital is one such website that has been created to secure funds for developers in the UK. This website allows builders and developers to model deals to raise debt and equity by optimising profits with the lowest equity requirements. Some websites are solely made for property developers to connect with high net worth individuals, while other websites help builders connect with senior debt lenders and junior debt lenders. Gone are the days when builders and developers had to fill paperwork after paperwork to find a sizable loan. Now, with the click of a button and the power of the internet, connecting with potential lenders and investors has become easier than ever!
Using social media to secure funds
Property developers can use social media marketing tools to their advantage. Builders and developers can use social media advertisements to find the target audience and create awareness about their upcoming projects. That way, they will be able to create awareness among potential investors and lenders, who could then reach out to the builders and developers with deals and proposals. Also, developers can create targeted advertisements specifically for high net worth individuals and property investors to create awareness about their brand and upcoming project. Also, crowdfunding tools can be used on Facebook and other platforms, which might help builders and developers raise a certain amount of capital. To secure funds using social media, the developer or builder must be well-reputed and highly experienced! And, of course, hiring an excellent social media marketing company is key!
Getting in touch with angel investors
Usually, angel investors are those investors who invest money in a start-up or a new business by taking a certain amount of equity. In the earlier days, angel investors in the real estate industry were not very common. However, that has changed. Nowadays, most angel investors have certain groups on public platforms such as Facebook and LinkedIn. Thanks to this, it has become much easier to find many people who might be willing to invest in an upcoming project. By getting in touch with angel investors online, builders and developers can secure a hefty amount of capital in a short period of time. Therefore, raising finance for property development through angel investors is highly recommended for new builders and developers as opposed to seasoned developers, as the former might be more likely to give up equity for a certain amount of capital.
Securing funds via crowdfunding websites
Crowdfunding websites have become very popular among builders and developers. Now, there are so many different types of crowdfunding websites that have specifically been created for property and real estate developments. Some websites allow builders to connect with potential lenders and investors, while other websites help property developers find angel investors. Some websites are solely dedicated to equity-based crowdfunding. And of course, there are some crowdfunding websites which only connect property developers with high net worth individuals and companies with high turnovers. Depending on the amount of capital required and the preferred investment type, either debt or equity, builders and developers can use crowdfunding platforms to their advantage.
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