The concept of crowdfarming investment is pretty much how it sounds. It’s similar to crowdfunding but with a focus on farming. Since it involves real estate (agricultural), it is viewed as an alternative asset class. The idea is to provide a platform through which farming properties and those who manage them can connect with potential investors.
Accredited investors have the opportunity to hold some diverse assets in their portfolios for periods ranging from 5 to 12 years. Depending on the crowdfunding platform you choose, you can expect annual liquidity windows that allow for earlier exits.
In crowdfarming investment opportunities, other things include a simple sign-up process, low fees, minimum investment requirement, and diverse quality assets curated to fit your portfolio needs.
There should be transparency about the farms you will be investing in and the reasoning of the platform for selecting those particular farms. For example, what is the growth potential for a specific type of farm in that location? Suppose you are primarily interested in agricultural and environmental impact. In that case, the company should provide you with the option to invest in a sustainable farmland fund.
Right now, a lot of these crowdfarming investing platforms only allow accredited investors to participate. If you’re not an accredited investor, find out if you qualify for one. At a minimum, expect to pay around $15,000 to get started with farmland crowdfunding.
Crowdfarming Investment With Your Preferred Method
Investors should be allowed to choose their preferred method of investing, be it as an individual entity, LLCs, corporations, self-directed IRAs, and other vehicles. The ability to monitor crowdfunding investment accounts is also essential. All necessary documents, performance metrics, projected payouts, actual payouts, historical distributions, and other criteria should be easy to access through the portal.
Since the farmland and agricultural industries are so vast and encompass many assets, look for opportunities that involve low-volatility assets such as almonds in orchids, organic vineyards, and certain types of crops.
This type of investment should not be confused with a real estate investment trust (REIT). As long as you choose the right platform, you will own units of an entity devoted to the operation and ownership of an asset. In contrast, REIT shares don’t count as physical ownership of any piece of property.
Where is the best place to get started with crowdfarming investment? At FarmTogether, there are various options available for any accredited investor interested in farm and agricultural investments, whether they be crowdfunding or sole ownership. It’s an excellent platform that helps bring interested investors together with some of the highest quality farmland.