What are my investment-related expenses with Crowdestate?
How much is Crowdestate charging as its fees?
Crowdestate might be charging any or all of the following fees that are attributed to either the investor or the sponsor.
- A one-time, 4% structuring fee is paid to Crowdestate for finding the investment opportunities, completing due diligence, capital structuring and covering direct costs (such as legal costs, establishment of SPV etc) associated with the transaction.
- Regular base fee that covers the costs for maintaining the investments, SPV management and accounting etc. Development projects pay fixed monthly fee that is agreed on case-by-case basis.
- Crowdestate is entitled to carry (success fee), if the investment performance exceeds the agreed hurdle rate. Typical success fee is 20% over the 8% per annum hurdle rate. Success fee is paid out at the end of the investment period after the investment has been exited. The fee is calculated into the expected yield, meaning that it is not deducted from the interest payments made to investors.
Fees associated with bank transfers
Generally there are no fees for bank transfers to an investment account from Estonian bank accounts (excl. payments in a foreign currency other than the euro).
Bank transfers from countries other than Estonia could be subject to transfer fees, if any fees apply and the person leaves the fees to be paid by Crowdestate during the transfer. In such cases Crowdestate will deduct the applicable fees from the payment before accruing it to the investment account. For this reason we always suggest to check that the person making the transfer also carries the fees associated with the transfer.
Currently there are no fees for outgoing bank transfers.
Bank transfers in another currency
The official currency for Crowdestate investment accounts is the euro. So, all payments made in a different currency are subject to conversion prior to accrual to the investment account.
All fees related to accepting a payment in other currencies and converting the payments to euros will be deducted from the payment received, taking into account the applicable price list of AS LHV Bank.
Outgoing transfers from an investment account can only be made in euros.
Why are Crowdestate's fees structured like that?
Crowdestate's fees are structured in a way that would motivate Crowdestate to maximize the value it created for its investors.
Structuring fee covers the costs of finding the investment opportunities, due diligence, setting up SPV-s etc.
Carry motivates Crowdestate to find and offer investment opportunities with above average appreciation potential.