Investing in real estate with a bill of 10 euros. Here is the original concept of Bricks.co, a startup created in April 2021 by Cedric O’Neill. Quite a unique model in the world of paper real estate, as Bricks.co has neither the status of a real estate investment company (SCPI), nor a crowdfunding real estate platform. What does Bricks.co sell? Future income purchase and sale agreements [ou contrats en royalties]. Specifically, the company buys buildings and then divides them into thousands of shares (so-called bricks) for 10 euros. Then investors have the right to receive part of the rent and capital gains of the building. However, the company remains the owner and manager of the assets. With exciting promises of profitability (rent and potential capital gains), from 6% to 14% per year, the young shoot already has a well-filled hunting list: 35 facilities for a total of 45 million euros, 200,000 registered on the platform and 45 employees .
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A hobby that did not contradict – far from it – their fundraising in late April. If the platform’s customers planned to raise 5 million euros, the entrepreneurs earned 20 million. I must say that the promise given to the participants was attractive: to invest in a startup with the same vehicle as in the purchase of shares in buildings, ie royalty contracts, which could be exchanged at any time on the secondary market.
But this unconventional fundraising attempt was stopped in its infancy, unfortunately by Cedric O’Neill. “When the authorities saw that we had raised funds from 11,500 people, they asked us to change our royalty contracts to financial securities, as they believe that investing in a startup is not associated with such a risk as investing in real estate. . So we will start with the shareholder format, but suddenly those who decide to stay in fundraising face unsecured liquidity, and their funds may be blocked for 2, 3 or 5 years, “said the CEO of Bricks.co. The problem is that the change of status was announced after a fundraiser via YouTube video of less than two minutes, which reported bad news without explaining the reasons for this change.