I found about RealT when Uniswap my favorite exchange tweeted about it.
They didn’t endorse it but basically said that they are using uniswap to exchange real estate tokens of to a property located at 9943-Marlowe Street, Detroit, USA. My interest piqued at this, because I have been looking for ability to invest in other countries for a long time. Naturally, next step I took was to research into this project.
Most questions I had to deal with revolved around these concepts:
1- How do you verify something is real on the internet?
2- How do you know it is not a scam, ponzi scheme etc.?
3- With my fair share of experience in scams, how should I approach this?
My first attempts at trying to understand RealT all evolved in trying to convince my friends and family that this is a real project that is managed by nonscammers. If I can convince myself of this then I should be able to answer their questions in full detail. This is my journey of verifying RealT company, their business model, the team members and their backgrounds, I hope it helps you on your due diligence.
The Business Model
All you need to learn about the business model is provided on the website: Blog and Learn pages. I’d suggest starting from there. It is important to realize this is a startup and there are risks involved with any startup business. My personal experience is that it makes it easier to talk about the business by dividing it into 2 realms especially when talking to people unaware of cryptocurrencies in general:
1- Real estate investing
2- Tokenization on Ethereum.
Everyone I talked to understands the first part, but people have difficulty understanding and operating the second one. If the people you try to talk to don’t have any background interacting with Ethereum or cryptocurrenices in general, you might probably lose them while talking about the second part.
For an easy introduction to what RealT does the first blog post is very informative. I’d suggest reading them all as there are a total of 9 posts there.
If you want more details after that I’d suggest going over Marlowe operating agreement document provided in the “Learn” section of Realt.co website. I wanted to learn the risks of operation and it has a very detailed section about the risks — 15 pages long.
The other source for information about the current business affairs is written by David Hoffman via medium.
At this point I registered through the RealT website and went through with KYC and bought 1 Marlowe token for 63.75$.
RealT Company
There is an entity named Realtoken inc. that you can check here.
There are other documents that you can verify on the website.
Now we know there is a company through a government website that’s lead by Remy Jacobson as stated on realt.co . Nature of business is clearly stated: “Any lawful purpose, other services, the purpose of organization includes, but is not limited to fractional ownership of real estate.”
For a better explanation David Hoffman provides details:
“RealT” is two things. RealToken Inc (us, the for-profit company) and RealToken LLC (the legal entity that creates system that enables the tokenization of the properties)
Real Token Inc., A Delaware registered business entity, is the name of our company. We refer to it, and can said to be doing business, as RealT.
In order to conduct a business to offer real estate worldwide, RealT has created a separate entity, also Delaware registered, named Real Token LLC. It is a master or if you will, umbrella, company. It does not own any other LLC or other business entity, nor any property. It’s primary value is to simplify and lessen the complicated and costly legal process incumbent in providing what is characterized by US authorities to be an investment security offering; which each and every property we offer is deemed to be.
(So rather than having a nearly 100 page private placement memorandum for each offering, one master ppm is required and each following offering requires only a much shorter amendment.)
Finally, for each offering we create a Series LLC; each of which own a single asset (a property), has its own token and unique address. Each stands solely and legally on its own, is not cross collateralized with, nor affected in any legal or operating manner to, any other series LLC. Each is owned by the investors who purchased its unique tokens and upon whom ultimate governance lies.
You can search for RealToken LLC here.
Well respected German newspaper FAZ made news about RealT very recently.
Team Members
We can look further into each member of the team in detail. They have their bio on the website which you can read here.
Let’s start with the easiest to verify.
David Hoffman
David Hoffman’s twitter account and his podcast POVCryptopod
https://www.buzzsprout.com/314447/1624465 David talking about Realt
Louis Bevilacqua
When I went through the operating agreement documents which you have to sign to get the token, I saw Lou’s email and emailed him about RealT. He quickly verified that they are indeed working with RealT. Information about Bevilacqua PLLC is provided almost everywhere. A couple of links: Otis Gallery LLC SEC website, Nasdaq IPO Experts page, Bevilacqua PLLC website
Remy & Jean Marc Jacobson
Remy and Jean Marc Jacobson brothers are both very private people and don’t have much online presence other than their business profile. They were operating Liquid Bits before their current venture RealT.
You can find Remy jacobson talking with David in the show below.
I had the chance to talk with Jean-Marc for an hour over Zoom. I’d mention these as the major talking points in that hour.
- They weren’t planning on going public with the website in 2019. Initial plan was to provide to opportunity to friends and family.
- RealT has 3 founders with 20–25 years experience. They are looking for new markets but it is very slow because there is no VC capital.
- They are thinking of France and Belgium next for a new property. Application can scale however the major chunk of spending goes to legal compliance (45–50%)
At this point I didn’t go further in verifying the rest of the team members as I thought this was enough.
Ideas for the Future
It took me around 2 months to go through this whole ordeal: researching, investing, convincing others of the possibilities, trying uniswap, looking for arbitrage opportunities. At the end of 2 months I have been successful in convincing my wife and a colleague. There is also another potential colleague who would be interested when 1 year mark has passed from the start of RealT operations. Realt anniversary is coming up in 2 months, so I remain hopeful.
Every passing day the company operates, one can see the progress in operations and the ideas flourishing and the potential RealT can bring in the coming years. I think the future of RealT is very bright. I’m already investing monthly into this process as the 12.5% return of 16200-Fullerton is unheard of where I live. The research I have put into this might be unnecessary in the near future as the company gets more and more recognized within the industry.
I think tokenization might create the next wave of cyrptocurrency users as it enables participants to reach investment areas otherwise hard/impossible or even fund themselves via tokenizing their own time like this NBA star. Real estate tokenization is easy to understand and a much better start for the evolution of security tokens instead of the ICO mania that happened in 2017.
I want to thank David for review and suggestions for the article, Jean-Marc, Remy and Gary for answering each of our questions in Telegram. If you think this article has helped you in anyway consider using my Referral link or my friend V’s referral link. If you have read this far, don’t forget to join RealT telegram channel: English or French.
