Human beings are social creatures. Interacting with people is not a decision, it is a blueprint of our brain. Since we don’t have enough strength or tools to survive alone, we had to find a pack to protect us. Therefore, being part of a small village, our community always brought peace to our hearts and made us feel safe. Nowadays, with technology, we can witness this community ideally scale to a new level. The internet allowed us to find people who have the same taste, goals, and thoughts and made it easy to nurture our small online village. While the online community idea is very appealing and enjoyable, we still need the real-life connections and have something concrete to look at and realize we helped made it, is a very full feeling. Digital investing can build a bridge between the online and real-world community, and deliver a real-life, concrete, output.
A good example of its potential lies in the real estate market. Excuse me for painting a quick picture here: let’s say John lives in a middle-class neighborhood in the suburbs, and every time he wants to enjoy a good meal, he needs to drive 40 minutes to downtown. He would like to have a restaurant and a nice plaza nearby, and many others neighbors share the same wish, but it didn’t happen. Now, with digital investing, this can change. In a nutshell, you can make an online survey to figure out what kind of business that neighbor is demanding, and then with digital investing, is possible to create a crowdfunding project allowing people to invest in it. In this scenario, John will be able to invest in the plaza, enjoy a restaurant nearby and earn some passive income.
New technologies, combined with strong regulations are making this possible in secure, easy and affordable ways. In Canada, the equity crowdfunding portal was regulated in 2016 and it is establishing a strong set of requirements for companies to operate in this model. In simple words, a crowdfunding portal is not only a website that you access and buy an investment. They are highly regulated organizations that besides making profits, aiming to deliver compliant projects to a potential investor, they ensure that the investment class is suitable for that specific investor.
From the real estate developer’s perspective, digital investing can change entirely the current business strategy. Instead of buying land and initiating construction, now they will need to do customer discovery process first. It is possible to access primary data very easily by running a quick survey or joining a resident association meeting. In that way, it will be possible to pick and choose the specific type of project that will address the community's needs and help them thrive. As a bonus, they can find partners and ambassadors for the project, allowing marketing and sales to run smoothly. Everyone wants to be part of something that will make a difference in people's lives.
Digital investing in real estate is in the early stages and there is a long way to go still. Although, the synergies between its technology and ability to connect people to real value are undeniable. Through this new approach, it is feasible to create sustainable real-life value in our communities. As soon we realize its potential, as soon we can get the benefits from it.
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