YieldStreet has launched the world’s first tech enabled specialty finance and alternative lending platform connecting accredited investors to asset based investments.
YieldStreet is designed to offer opportunities that are backed by collateral, have low market correlation, and generate strong yield, such as loans secured by real estate portfolios, litigation finance investments or even a loan to an NBA player secured by his contract. Investments have low minimums starting at USD5,000 with average target yields in the mid-teens. In the past, such options were exclusively available to ultra high net worth individuals, hedge funds or institutional investors.
Founder and CEO, Milind Mehere (pictured), a serial tech entrepreneur whose previous company, Yodle was recently acquired for USD342 million, says: “As an investor myself, I was frustrated with the lack of investment opportunities outside of the stock market. We started YieldStreet to meet the needs of investors today who want to gain access to investments with high yields like hedge funds and institutions do, but have limited options with existing financial advisors and wealth management platforms. Most require high minimums and long holding periods that have historically shut out most investors. We are changing that.”
Technology is the critical differentiator that connected specialty finance expert Michael Weisz with Mehere. “YieldStreet combines decades of investment and risk management experience with technology to open access and help investors consistently hit doubles and triples on their returns. Our platform enables an individual with USD5k to invest in the same opportunities as a family office with millions,” says Weisz, Founder and President. For investors, the automated platform aims to make investing as easy as buying public stocks or ETFs. YieldStreet’s technology provides a refined experience with full investment transparency, seamless portfolio management, bank integration and payments. Additionally, the platform supports lenders in due diligence, evaluation and underwriting.
Founded in 2015, YieldStreet closed a seed round of USD3.7M from Expansion Venture Capital, Saturn Venture Partners and strategic fintech angels. In its first year in stealth mode, YieldStreet has already attracted the trust of a wide range of Accredited Investors ranging from small individuals to large family offices.
During the past year, YieldStreet has completed 20 investments and funded USD35 million in loans; returned USD7 million principal and interest to investors, with USD0 principal loss; been named as one of Business Insider’s 2015 "Top 20 Companies Changing Wall Street”; and been granted Registered Investment Advisor (RIA) status by the US Securities and Exchange Commission in April 2016.
The 2012 JOBS Act opened the door for general solicitation and crowdfunding online. “YieldStreet is using technology and data to radically change how we think about investing, financial planning and wealth management,” Mehere explains. “As part of this approach, YieldStreet University provides learning tools, tutorials & calculators to educate investors and help them make informed investment decisions.”
“We intend to become the number-one marketplace where investors can create a diversified portfolio across different asset classes, managers, returns and duration to complement their existing investment strategies and achieve their personal financial goals,” says Weisz.
Joining Mehere & Weisz on the YieldStreet founding team as Chairman is Dennis Shields, founder of Esquire Bank. Shields brings over 20 years of specialty finance, risk management and compliance experience.
YieldStreet is targeting USD100 million in loans this year and expects to raise a fund from family offices and institutional investors along with accredited investors to fuel its growth. Yieldstreet is also expecting to open the platform to all investors, truly bringing main street access to alternative investments for the first time.