DiversyFund 2023 Review and Ranking
Challenged (1 out of 10 stars)
What is DiversyFund?
To avoid the financial conflicts-of-interests that are rampant on virtually every other review site, I DON'T accept any money from any outside sponsor or platform for ANYTHING (including but not limited to affiliate ads, advertising etc.). See code of ethics for more.
Note: Since the 2 principals of DiversyFund Inc also ran a previous real-estate investment firm, it is being included in this review. The previous company was CCFG dba (doing business as) DiversyFund. Both companies have operated from the domain name: DiversyFund.com
9/28/17: “CCFG dba DiversyFund and BRE (the California Bureau of real estate) appear to have reached a settlement on the previous charges against the company, after the BRE review of CCFG's response to the BRE allegations.
CCFG did not admit to or deny any of the charges. BRE did not hold a hearing to determine the validity or invalidity of the charges.
For the purposes of settlement, both parties have settled on a single charge of “failure to supervise”. Craig Cecilio (owner of CCFG) will have his license suspended for 60 days, but may reduce this by 30 days by paying a $3000 penalty (which DiversyFund Inc. claims he has already mailed in). And Ceclio may reduce license suspension by another 30 days if he completes certain continuing education courses on trust fund accounting and handling and have no further violations for 2 years.
Update on 9/3/2017: CCFG (dba DiversyFund and who operated on DiversyFund.com), has a pending government action against it by the California Bureau of Real Estate (BRE).
Per the Better Business Bureau: "The company stands accused of secret profit or undisclosed compensation, use of false or Fictitious Business Names, failing to submit independent audit report, failing to file with the BRE the Quarterly Threshold Reports, failing to supervise the real estate activities of the company, inaccurate and incomplete trust fund records, inaccurate and incomplete recording of separate record for each beneficiary or transaction, and failing to maintain the monthly reconciliation of all the separate records or transactions to the balance of the record of all trust funds received and disbursed." Click here for more details.
update on 9/26/2017: an investor claims that they received spam email from the dedicated email address that they had set up just for DiversyFund.com.
Update on 6/23/2017: Investors say the platform did not give them adequate updates on an investment when it ran to troubles. (Fortunately it did recover).
Update on 6/25/2017: Diversyfund has a low 3.3 out of 5 rating on Glassdoor, and a considerable number of poor reviews. If the posters are real and their complaints are accurate then the company environment may not be the most stable.
DiversyFund has a fairly unique take on residential investments, and offers equity instead of the usual debt.
They also earned kudos for setting up bankruptcy protection. (even though it's via voting, rather than setting up a third-party administrator in advance).
They would have ranked higher, had they not chosen to withhold their sponsor fees from us. Knowing this information is important to investors, because it enables them to see the true total cost the marketplace imposes on each investment. We hope that the company reverses their policy about this in the future, and becomes more transparent.
Advantages: Access to residential real estate equity, some bankruptcy protection, no fees (on direct investments only. Funds have underlying fees).
Disadvantages: transparency issues:DiversyFund would not reveal their sponsor fees.
Where can I discuss other DiversyFund deals?
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Who are DiversyFund Competitors?
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Personal opinion only: All info is my personal opinion only as an investor. I am not an attorney, nor an accountant, nor your financial advisor. Always do your own due diligence and consult with your own licensed professionals before making any investment decision. Information is believed to be correct but may have errors, so use at your own risk. If you find an error, please let me know.
Ratings are general: In my opinion, every investor comes from a different risk tolerance and financial situation, so there's no such thing as a single investment or platform that's great for everyone. There are many deals that aggressive investors love, which I won't touch, and vice versa. And every investor has their own way of doing due diligence. I believe there's no one right way to do it.
So, the site ratings are based on criteria which I feel are important to the broadest range of investors (transparency, volume, bankruptcy protection, etc). And even though I have my own personal, conservative, due diligence method (and talk about how the site's deals measure up in the "deep dive section"), I don't use my personal criteria as a factor in the ratings. So for example, a high ranking/rating doesn't mean that I would personally invest in a site (and vice versa). Click here to see what's in my own portfolio.
About Ian Ippolito
Ian Ippolito is an investor and serial entrepreneur. He has been interviewed by the Wall Street Journal, Business Week, Forbes, TIME, Fast Company, TechCrunch, CBS News, FOX News, USA Today, Bloomberg News, Realtor.com, CoStar News, Curbed and more.
Ian was impressed by the potential of real estate crowdfunding, but frustrated by the lack of quality site reviews and investment analysis. He created The Real Estate Crowdfunding Review to fill that gap.
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