YieldStreet is an alternative, asset-based investment marketplace platform. It allows you to build a collateral backed, diversified portfolio. It was created to provide access to investments which were once only available to an elite few.
Previously, high yield, asset-based investments were only available through the Wall Street stock market. CEO Milind Mehere wanted to create a platform that allowed everyone to take advantage of investment opportunities.
One example is you do not have to be an accredited investor to work with YieldStreet. He teamed up with Esquire Bank founder Chairman Dennis Shields and former fund manager Michael Weisz.
With their combined investing and finance experience, they opened an avenue for investors outside the traditional Wall Street game. Interested investors should check out the Bloomberg Businessweek November interview with Mehere. He says the team’s end goal was to democratize the higher yield investment game. He also explained his reasoning for creating a passive income stream in February for Forbes.
Types of Investments Offered by YieldStreet
Investors seeking alternative investments can utilize YieldStreet in four different asset classes. These include real estate, litigation, commercial, and consumer finance.
Plaintiffs may be able to meet living expenses while awaiting the litigation of their cases through pre-settlement financing. Of all the alternatives opportunities YieldStreet offers, this is perhaps the most common. In this case, someone with a physical or personal injury lawsuit pending receives an advance from the finance company. Pre-litigation portfolios may contain anywhere from 50 to 300 different cases.
The second most common investment alternative available through YieldStreet is real estate. They are generally urban properties which are down cycle resilient. These types of investments are also said to have a low LTV, loan to value, ratio.
Law firm loans are another type of alternative investment offered by YieldStreet. It assists contingency law firms in funding ongoing court cases as they must wait until the end of the cases before receiving their portion of the settlement.
YieldStreet provides investors with opportunities that are much more affordable and therefore more attainable than those on the stock market. Instead of stock exchanges, brokerages, and large bank holdings members co-invest with other members. It enables them to place investments in asset classes such as commercial business and real estate with strong cash flows.
How does YieldStreet work?
You must create an account on YieldStreet to begin investing. You must confirm your identity via a link sent to your preferred email. Clicking the confirmation link leads you back to the website to complete the setup of your YieldStreet account.
During this completion, you will be asked to link a bank and pre-fund your account. As mentioned above, it appears that you must begin with at least $10,000. Pre-funding means bypassing the settlement wait period and your investments become active much sooner.
You may choose to delay the funding withdrawal by up to two business days. You can also select the wire transfer funding method. YieldStreet sends an email which contains instruction for completing a wire transfer set-up. In the latter case, you are responsible for initiating your payment to YieldStreet. This method allows you to take up to five business days to send your payment.
Once your account is confirmed you will be able to browse through all the currently available offerings to decide which is best for your diversified portfolio. You will need to fund your Wallet before you can invest in any of the offerings. It is important to understand that YieldStreet does not consider the investment complete until you have provided the initial funding payment. Your account begins to earn interest from the moment it is marked active.
Initial Investment Costs
Minimum investments through YieldStreet range from $10,000 to $15,000. Once your YieldStreet wallet is set up you can browse through their offerings. Both the minimum and maximum investment cost depend upon the offering you choose. You have control over the exact amount you invest so long as it is between the minimum and maximum as stated in the offering.
Customer Service Support
There you will find several emails addresses as well as a telephone number. YieldStreet provides a resources link which includes an FAQ page. You can also find a number of contact options at the bottom of every YieldStreet email.
Investment Platform Options
While alternative investments are a relatively new concept, YieldStreet is not the only company which offers these types of diversified portfolios. These types of opportunities are available worldwide from the United States to Singapore. Below you can investigate a few other companies similar to YieldStreet.
Dream Funded was founded in the United States to connect investors with quality startup companies.
Seed Invest, also launched in the U.S., allows individuals to invest into highly vetted startups.
Crowd2Fund is a private company in the United Kingdom which provides access to simple finance options and investment opportunities at extremely competitive rates.
Katipult is another private company option, this one based in Canada, which offers crowdfunding investments.
Before embarking on your investment journey, there are a few important considerations. While YieldStreet does offer investment opportunities once available only to the super rich, there are still risks involved. Due to the nature of collateral-based investments, the risks are a bit less than those of which are non-asset-based.
Much of the risks depend upon the asset class and your personal portfolio decisions. Once this is understood, there are numerous investment opportunities with high yields available to nearly all types of investors.
Bear in mind that this should be considered a passive income stream. It isn’t wise to invest all your money into any type of investment without active and effective income. Remember, you may receive wonderfully high yield returns, but there is also the possibility of loss.