How We Started A Real Estate Investment Platform

Andy Zhao

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Published: June 18th, 2021

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Andy Zhao

Founder, Ark7

Founders

Employees

Ark7

ark7.com

from San Francisco, CA, USA

started June 2018

Founders

Employees

Discover what tools Andy recommends to grow your business!

platform

Angular

Node.js

Canva

SendGrid

social media tool-icon

YouTube

Instagram

productivity tool-icon

MongoDB Cloud tool-icon

Slack

Jira

blog

WordPress

design

Canva

other

PostgreSQL tool-icon

Redis

Docker

Discover what books Andy recommends to grow your business!

The Power of Now: A Guide to Spiritual Enlightenment Eckhart Tolle

Want more updates on Ark7? Check out these stories:

Hello! Who are you and what business did you start?

Hello, I’m Andy Zhao, Ark7’s Founder & CEO. I have previously worked for Google, Uber, LinkedIn, and Twitter, with more than 10 years in the tech industry.

I founded Ark7, a real estate investment platform where you can buy property shares at as low as $5 to earn passive monthly income and future appreciation. In the meantime, you don’t have to worry about property management because we take care of it.

Currently, Ark7 has 7 properties located in Berkeley, Austin, and Seattle. Users can visit our website and sign up for free to see full disclosures of our property information and start their real estate investment today. The total value of Ark7 is $8.74 million and the total investment value is $5.5 million.

What's your backstory and how did you come up with the idea?

When I first considered investing in real estate in the Bay Area, I was working at Uber and found it required a great deal of time and money to purchase and maintain a property. After discussing these barriers of entry into real estate investment with Jim, a friend, and longtime real estate agent, I decided I wanted to create Ark7 — a company that makes investing in property as easy as buying stocks.

Our ideal customers are people who want to invest in real estate but do not have enough money to invest or time to manage the property. The majority of our users are engineers at tech companies on the west coast.

We have found that investing in real estate is a big headache with high down payments and large loans that make it inaccessible at low costs. If you invest remotely, you don’t know what is going on in that housing market. This is a situation that could cost you a lot of money. When Ark7 purchases a property, we build an LLC for each company to protect the users’ investments. We will first do long-term rental properties, then we will do short-term rentals in the future.

Take us through the process of designing, prototyping, and manufacturing your first product.

When I started Ark7, I dug deep into the standard pathways for property investment such as REITs, or real estate investment trusts, and crowdfunding platforms. I found a lot of inefficiencies. For one thing, investors would have to deal with delineating money to financial advisors, sales, asset managers, and property managers dwindling your overall profit. Not to mention that if people invested through REITs, they would have to relinquish a huge amount of control over which properties they invested in. I formulated the idea behind Ark7 “making real estate investment as easy as a stock investment,” around giving people full control over their capital.

I teamed up with Ark7’s other co-founders including Jim Holt, a real estate expert with more than 15 years in the game. Together, we designed the platform with user experience in mind with a website tailored to help keep tabs on properties as well as learn more about future investments.

The Ark7 team ensures property tenants are assured and can make payments quickly and securely through our Ark7 Renters App. Our website clearly displays each location with surrounding points of interest, estimated total returns, legal documents, market appreciation predictions, and more. We have iterated the product based on our early users’ feedback, from an 8-page document to a Google Slides presentation. It is thanks to their honest feedback that we have been able to improve the product.

how-we-started-a-real-estate-investment-platform

Describe the process of launching the business.

From an initial seed investment of $2 million in July of 2019, our first property, located in Berkeley, California was bought in 2019. After seed funding, it took one year to develop and polish the product.

The ark7.com website launched in May 2020 and Ark7 grew to a user investment of $1 million in just two months. Our investment amount reached $3M in December 2020. In 2021, we have launched 4 properties, 3 in Austin and 1 in Seattle, and have $5M in user investment.

Our revenue comes from property management, so we take care of each property and we invest our own money in the company to align our interest with our users. For an early promotion in the first year of our launch, we do not charge a PM fee.

Our ideal customers are people who want to invest in real estate but do not have enough money to invest or time to manage the property. The majority of our users are engineers at tech companies on the west coast.

Screenshots of the original website:

Since launch, what has worked to attract and retain customers?

Ark7 has been running ads on sites like Facebook, Blind, and LinkedIn to find new users. We currently have 230 followers on LinkedIn and make regular updates on our Facebook, Instagram, and other social media.

LinkedIn Ad:

Blind Ad:

We also launched on Product Hunt on March 13th and won the #2 Product of the Day, #3 Product of the Week, and #5 Product of the Month badges.

How are you doing today and what does the future look like?

Ark7 is profitable, with 2500 registered users and $8 million in property value. Our goals for 2021 include reaching a user total investment of $20M, launching properties in 3 cities in the United States, developing an IRA investment feature, and creating an investor app.

Fast forward to our goals for 2022: we aim to reach 200,000 registered users and launch properties in 20 cities. We want to reach out to users in the Bay Area and cities like Seattle, Austin, and New York.

We are working 100% remotely and have 10 full-time employees in California, Washington, and Texas. During COVID, people have invested with us because they can sign in and invest remotely while we manage properties, and tenants can also contact us remotely.

Through starting the business, have you learned anything particularly helpful or advantageous?

At the beginning of Ark7’s process, we consulted lawyers and real estate agents to understand the qualifications to build Ark7.

Sites such as Product Hunt are helpful to entrepreneurs. Our Product Hunt launch was successful, we received many new users, and Ark7 was featured in the Product Hunt Daily Digest newsletter.

What platform/tools do you use for your business?

Our tech stack includes Angular, NodeJs, MongoDB, Elixir, Postgres, Redis, Airflow, Kubernetes, Docker, and more.

Tools we use are Slack, Jira, SendGrid, WordPress, Canva for their productivity and streamlined features. All of these are efficient and easy to use.

What have been the most influential books, podcasts, or other resources?

The Power of Now: A Guide to Spiritual Enlightenment. I have read this book 3 times. It was my first time to put myself down, forget about personal gain or loss, and not see the world from a self-centered perspective. I was able to perceive the world in a more accurate objective way.

Advice for other entrepreneurs who want to get started or are just starting?

Think clearly about what to do before doing it.

Think systematically.

Are you looking to hire for certain positions right now?

A Customer Success Specialist. Responsible for building a lasting relationship with our clients representing them internally at Ark7 and providing key insights on the customers' plans to get ahead of the curve. Paid, full-time.

To apply, send applications to: [email protected]

Where can we go to learn more?

If you have any questions or comments, drop a comment below!