This article was published in leading Lithuanian news media Delfi.lt
A community of 16,000 investors, more than €10 million in investments funded and the award for best investment tech at the 2022 Europe Fintech Awards - all this has been achieved in just a few years by the Lithuanian fintech InRento, which has come up with an innovative way of investing in real estate rental projects.
Capital earns capital
Those who care about their finances know that to protect their savings from depreciation, it is important to put them to work. However, many people find profitable investing to be a complex and quite resource-intensive process. Crowdfunding platform InRento has come up with a product that makes investing in real estate rental projects accessible to everyone. Starting its operations during the very difficult period of the COVID-19 pandemic, the founders of the platform managed not only to adapt to market changes but also to ensure stable growth.
"Our aim in developing this product was to enable people to invest intelligently, consciously and as safely as possible. Investing in physical real estate requires a significant initial capital, while our platform allows investing relatively small amounts of just a few hundred euros in buy-to-let projects, thus providing diversification and enabling anyone who wants to protect their savings and earn extra income to invest," says Gustas Germanavičius, the founder of "InRento".
InRento's platform, which won the Best Investment Technology award at the 2022 Europe Fintech Awards, boasts a truly remarkable track record: in just over two years, the company has managed to build a community of almost 16,000 investors and transacted €10 million in investments. The credibility and potential of the platform is also demonstrated by the fact that around 50% of the investor community is made up of foreign investors, and three investment funds have invested in InRento and become shareholders in two years.
Opening new and attractive markets
"As a company, it is not only results that matter to us, but also credibility, consistent growth and development. We are taking a conservative but lower-risk path with a long-term view. Our focus is not on rapid expansion, but on consistent, stable growth," says G. Germanavičius.
The effectiveness of the chosen strategy is evidenced by the figures: InRento, the first-ranked investment platform in Lithuania in terms of the average interest rate, has become one of the few investment platforms without delays, with the realised projects generating an average annual return of 15.46%. Investors were able to earn a more solid annual return thanks to expansion into new markets and well thought-out investment decisions.
"Today, we offer our community members the opportunity to invest in real estate rental projects under development in Lithuania, Spain and Poland - countries where the real estate rental market is well developed, mature and has a very high return from rent. Investors on crowdfunding platforms usually earn interest, but InRento offers the opportunity to earn additional income from capital gains when projects are successfully realised," says the CEO of InRento.
Saving is not financially viable
With economic uncertainty and a difficult geopolitical situation around the world, doing nothing can be costly for the population. According to Germanavičius, planning one's finances and investing wisely has always been the best way to not only protect one's savings, but also to earn money.
"The real estate market has always been considered a relatively safe investment, distinguished by its stability and high long-term returns. Despite the fact that prices on the property market fluctuate constantly, they tend to rise in the long term. Investing in rental property projects through a crowdfunding platform is a good opportunity to secure financial stability even if you do not have any assets of your own", says the founder of InRento.
He is convinced that it is only worth investing in areas that you know. For those who do not know where to start, but want to invest in rental property, Germanavičius advises to weigh the potential risks responsibly, as the promised high returns usually require taking higher risks. Based on his experience, Gustas suggests that first-time investors should choose financial tools with safeguards.
"On the InRento platform, all investors' investments are secured by a first mortgage on the property, pledging the real estate to the investors. In addition, the value of the pledged property never exceeds the value of the loan provided by the investors, and for many projects, the return that the project owner generates from the rent is higher than the interest that has to be paid to the investors every month. This risk policy significantly reduces the risk of insolvency of the project owner", emphasises Germanavičius.