The JOBS Act relaxed securities regulations that previously restricted general solicitation of private placement investments, and equity crowdfunding, or the offering of equity- or debt-based securities to the crowd, has soared. In 2013, $2.2 billion in capital was raised via equity crowdfunding.

In the next few years, the size of the securities crowdfunding market could grow to anywhere from “$3.98 billion to as much as $300 billion,” says Dr. Richard Swart, who leads the University of California, Berkeley's Crowdfunding Research Program.

Dan Miller, president and co-founder of Fundrise, says the firm was born out of the frustration he and his brother, veteran real estate developers, experienced when trying to pitch investors on their urban core projects.

Among the key benefits of crowdfunding for real estate projects are access to cheaper, faster, and more flexible capital; online management of investors and reporting; amplified branding and marketing; and the ability to tap into networks of thousands of individual investors.

More than 190 real estate investment offerings were crowdfunded by 150 sponsors between April 2013 and September 2014, resulting in more than $110 million of real estate debt and equity capital raised. Despite its rapid growth, the crowdfunding industry is young. It is estimated that less than one percent of the more than 50,000 real estate companies in the United States have used crowdfunding as a funding vehicle.

GlobeSt.com's newest white paper explores real estate crowdfunding, outlining its benefits and showing how crowdsourced funding can fit into a project's capital stack. Appendices include a guide for getting started with crowdfunding, and comparisons of typical terms for securing various types of capital (senior secured debt vs. mezzanine debt/preferred equity) via crowdfunding.

You can download the GlobeSt.com white paper by clicking here.

You can also listen to a podcast of our conversation with Fundrise Co-Founder and President Dan Miller in the player below.