Real estate is one of the most lucrative asset classes in the world—but it can be a challenging market for investors to participate in, unless they have tens of thousands of dollars (or more!) to buy properties with.
RAD Diversified REIT (RADD) is a public, non-traded Real Estate Investment Trust (REIT). RADD’s investors benefit from the portfolio’s overall success (e.g. rents, interests, and value gains), essentially giving them a stake in dozens of properties with a single investment.
Co-founders Dutch Mendenhall and Amy Vaughn started out as consultants, helping thought leaders in the real estate investment space optimize their profit centers and lead their teams with purpose. But the more “gurus” they consulted, the more Dutch and Amy began to realize that most of the industry’s most respected experts were still doing things wrong—and they decided to “build a better mousetrap” on their own.
RADD invests primarily in income-generating farms and cash-flow rental properties, like residential and multifamily units. Their model is to purchase and then purposefully repair “broken assets,” turning ugly and undervalued properties into beautiful, profitable portfolio additions.
RADD has been using DealMaker to raise continuously via Reg A+ since May 2021. So far, they’ve brought in $36.8 million and counting from investors worldwide. But the unique thing about this offering is the way it leverages DealMaker’s tech to change the price per share on a quarterly basis.
Each time, the share price is updated based on the value of the properties under RAD’s ownership—essentially replicating the experience of being a publicly-traded REIT and demonstrating the company’s continued traction. From October 2019 to October 2022, RAD Diversified REIT, Inc. was able to increase their share price from $10.00 to $22.22—a 122.2% jump in just three years.
“I think what makes the DealMaker platform so valuable to us is really the ease and efficiency,” said Dutch. “We do something that’s not necessarily typical of Reg A+ deals—we change our price per share every quarter based on the portfolio’s performance. By doing that, we’re able to show our investors real value growth, not based on some arbitrary valuation calculation, but based on the real traction we’re generating. That’s really important to our community, and I believe it’s why so many of our investors continue to come back and re-invest in our offerings again and again. And with DealMaker’s platform, it’s a super simple process. It’s almost effortless to do, but has a massive positive impact for us.”
So far, RADD has completed nearly a dozen Reg A+ campaigns, with a new offering launched each time the share price changes. Over the course of the past two years, 5,021 investors and counting from 22 different countries have participated in the deals.
“Even just a few years ago, most founders wouldn’t dream of bringing on more than 5,000 investors. The way traditional capital raises are run, it would just be a complete logistical nightmare and make a mess of your cap table,” said Dutch.
“Today, it’s incredibly easy to do. DealMaker consolidates each round’s investors into a single line item, and the online payment processing and IR tools make it easy to manage all that in one place. I actually think it’s preferable now to have thousands of investors versus just five or ten big checks. Our community gets stronger and stronger the bigger it grows. It’s kind of like having an army of RAD Diversified ambassadors out in the world. And that drives more investment volume, too. It’s really been a win-win for us—and based on my experience running more than 11 campaigns now, DealMaker is the best way to do it. We’re certainly not planning to stop anytime soon.”
RAD Diversified REIT is a real estate investment trust that invests in residential, commercial, construction, and farmland real estate markets. RADD adjusts its share price quarterly based on changes in its asset portfolio’s underlying net asset value.
For more information, visit raddiversified.com.