Fundrise vs Diversyfund

So you’re thinking about whether to include real estate in your investment portfolio by investing in DiversyFund or Fundrise?

Both platforms are well-known for their cheap minimum investment criteria and high historical returns. However, while they appear comparable, there are substantial differences in fees, liquidity, available investments, and how these companies operate.

This article covers most of what you need to know about these two companies.

Fundrise is Better for:DiversyFund is Better for:
New real estate investors willing to dip their toes in the water.Long-term investors that don’t want the stress of becoming a landlord
Unaccredited investorsThose seeking an alternative investment option to stocks and bonds.
Real estate investors looking for a “put it and forget it” option.Individuals who are not accredited investors.
Investors seeking a low-to-moderate-cost entry point

DiversyFund and Fundrise are real estate crowdfunding companies that allow ordinary investors to join the real estate industry and make money through income-generating properties by removing financial barriers. However, the setting and functioning of each platform differ slightly.

This guide lets you learn more and determine which platform is best for your needs.

Fundrise DiversyFund
Minimum Investment

$10

$500

Management Fees

85% yearly management fee
15% yearly advisory fee

Up to 10% of equity money may be spent on marketing and fintech platform operations.
2% property management fee

Asset Class

Residential and commercial

Multi-family properties

Asset Class

Individual account
Individual retirement account
Joint account
Trust account
Entity account

Individual account
Trust account
Joint account
Entity account

Modest Money Overall Rating
4.6 rating based on 5 ratings
4.0 rating based on 5 ratings

Fundrise offers a more affordable lower investing minimum than DiversyFund and is a good place to start if you’re new real estate investment.

Fundrise vs. DiversyFund: Determining Factors?

If you are considering investing and deciding between DiversyFund and Fundrise, remember that Fundrise has a proven track record of performance and more organized systems in place.

DiversyFund requires only a $500 first commitment, whereas Fundrise requires only $10. Fundrise, on the other hand, is the only one that gives investors access to better strategies and investments as their balances increase. Fundrise outperforms DiversyFund at the entry-level since investors can select between income, growth, or a balanced plan. These options are not available through DiversyFund. Regardless of balance or skill, all investors invest in the same assets.

Now that you’ve learned a little bit about what each company represents and what they offer, let’s see how these two real estate investment firms stack up.

Factor 1: Minimum Investment Criteria

If you’re a new investor, this factor can help you make better choices, especially if you don’t want to break the bank.

Fundrise has a lower minimum investment requirement than DiversyFund

  • $10 for Starter
  • $1,000 for Basic
  • $5,000 for Core
  • $10,000 for Advanced
  • $100,000 for Premium

Fundrise Minimum Investment Criteria

Fundrise requires only $10 to begin investing, making it our preferred option for investing in real estate with a small amount of money. You also don’t have to be accredited.

However, it demands a minimum investment of $5,000 to be eligible for its Core plan. Fundrise is somewhat less flexible for smaller accounts, but core clients and above can design personalized portfolio plans and select the funds they want to invest in.

DiversyFund Minimum Investment Criteria

DiversyFund requires a $500 minimum investment and is available to accredit and non-accredited investors.

Factor 2: Account Types

This is another thing to consider to make a choice that meets your needs.

Fundrise wins because, unlike DiversyFund, it accepts IRAs.

  • IRA
  • Joint accounts
  • Personal investment accounts
  • Certain entity accounts
  • Trusts

Fundrise Account Types

Fundrise supports:

  • Joint accounts
  • Personal investment accounts
  • Certain entity accounts
  • Trusts

You can also invest with your own IRA. If you wish to take advantage of potential tax savings while you invest for retirement, this is a substantial advantage over DiversyFund.

DiversyFund Account Types

DiversyFund presently supports these four types of accounts but does not include IRA.

Factor 3: Investment Type

One of the primary differences between DiversyFund and Fundrise is the types of investments each firm makes.

Fundrise Outperforms DiversyFund

  • Fundrise has a much wider range of investment options and asset types than DiversyFund.

Fundrise Investment Type

Fundrise uses a combination of debt, equity, and preferred equity to invest in commercial and residential real estate. This contains opportunistic, value-add investing methods like DiversyFund, but also strategies aimed at decreased volatility and predictable cash flow.

DiversyFund Investment Type

DiversyFund has two publicly non-traded real estate investment trusts (REITs) that focus on multifamily real estate projects with at least 100 units. It takes about five years to implement a value-add approach. For each property, the internal rate of return should be between 10% and 20%.

DiversyFund’s Growth REIT I is presently closed for investment, leaving only one REIT. These are still valuable commercial real estate options, but there isn’t much selection.

Fundrise vs. DiversyFund: The Bottom Line

Fundrise, in our perspective, has a lot more to offer. It offers a longer track record, more investment alternatives, and is extremely user-friendly for beginners. If you’re new to real estate investing, here is the place to start.

DiversyFund is a good firm with impressive returns. However, only time will tell if it can extend its REIT offerings while still producing returns.

Jeremy Biberdorf

About the Author:

Jeremy Biberdorf is the founder of Modest Money. After working many years in the website marketing industry, he decided to take on blogging full time and also get his finances headed in the right direction. Also check out his contributions to Equities.com and Benzinga.