Are you asking about real estate brokerage startup business? Please let me know what vertical you are talking about, and will be happy to assist.
Without knowing the specifics:
1. financial leverage
2. attractive returns for the sponsor
3. very low "product" risk (factors such as location, demand/supply are major variables. unlikely you are inventing a new real estate concept, unless you are working on building a space station)
1. can be structured with minimal sponsor capital at risk relative to potential gains
2. hard to differentiate
3. outcomes depend on market factors beyond your control
Although not directly relevant to your question, I believe it will add value to the others. There are a new breed of startups coming up in real estate called PropTech. They are working to streamline the uncertainties, the laborious processes, reduce the time in closing deals and many other areas. There are many great startups and technologies emerging out of this space. We at Skryptorz are using Blockchain to create value to the real estate market. Hope you find this answer useful!!
I built and sold a real estate investment company. For me the pros had everything to do with making massive gains in a short period of time.
1) ability to achieve huge gains
2) I started with almost no capital and very little experience
3) Multiple avenues for income
4) Long term security- real estate isn't going anywhere
5) Inflation is your friend and interest rates are still really low - You get a mortgage on a place at 5% and your ROI on a place is 10% on borrowed money. That goes strait to you
1) Its a huge liability - when you own something the liability is intense.
2) Its a huge pain - part of my business was property management, and that is a difficult business to be in.
3) Its not really passive. Whether you are managing properties or simply managing your managers, you are always dealing with your portfolio.
4) If you really want to become wealthy its a long term game. You will inevitably get burned when the market goes down, so you need to prepare for the long haul
5) A lot of capital gets ties up.
Everything depends on the tasks that this startup should solve.
Our studio has extensive experience in the direction of Real Estate, and I for example, I want to give you the following.
We were contacted by the digital agency, they were looking for a website with interactive visualization of residential areas. Taking into account a large number of objects, we would suggest considering custom solution, that allows to create rapidly a large number of interactive buildings. We’ve developed a unique online constructor that allows to reduce the time of creation one residential block up to one day.
The result is here - www.lp-astana.kz.
This solution allowed this construction company to accelerate the sale of their apartments significantly. And using this constructor you can create a startup that will allow any construction company to reduce time and money significantly to create such interactive visualization of Real Estate.
If interested, please, let me tell you in more detail.
@ Mishu Ahluwalia
I am talking about real estate development projects, regarding risks, perks for a developer.