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💡 Investing with the crowd

May 11, 2021 Sign up

Good day! We have a new section titled "Today's Movers & Shakers," where our good friend Ashu Singh calls out a few stocks moving the market today—check it out and let us know what you think.

Here's what else we cover today:

  • Crowdfunding. What you need to know before you invest with the crowd
  • Housing bubble. Are we in for a housing market crash? 
  • NFL draftees going broke. Why these pro-athletes run out of money


What you need to know before you invest with the crowd

Right now certainly seems like a really good time to invest somewhere other than the stock market. The waters are choppy, and the phrase “sell in May and go away” is sounding nicer and nicer each day the markets are open. 

The thing is, our options for alternative investments are seemingly endless. How could you ever possibly know which one to choose? Obviously, you should buy some Dogecoin first (joke!), but aside from that, where else could you invest your money?

What is Crowdfunding?

Crowdfunding is an alternative investment of sorts, usually relegated and assumed to be preserved for the ultra-wealthy who buy businesses and invest in startups because they can. This is no longer the case though, and as with almost everything else in finance, it's being democratized and accessible to all. 

Crowdfunding is essentially a form of investing directly in a private business or early-stage startup without having to wait for the company to go public. It's a way for the "crowd" to fund projects or businesses, rather than one or two major investors. And it caters to both the small business or startup looking for a new, innovative way to raise money and risk-seeking investors who want to get in early.

It was officially regulated in 2012 by the JOBS act, where originally only accredited investors could invest. Since 2016 though, anyone has been allowed to get involved thanks to some new legislation that permits individual investors to pitch in. According to the SEC:

  • If either your annual income or your net worth is less than $107,000, then during any 12-month period, you can invest up to the greater of either $2,200 or 5% of the lesser of your annual income or net worth. 
  • If both your annual income and your net worth are equal to or more than $107,000, then during any 12-month period, you can invest up to 10% of annual income or net worth, whichever is lesser, but not to exceed $107,000.

Things to consider before you start investing

Before you go out and try to locate the next DoorDash though, here are some things you should be aware of first.

  • Be prepared to be illiquid. Funds invested cannot just be pulled out whenever. Finders keepers, no give backsies, you get the idea. This isn’t just like buying a liquid asset like shares of a stock, this is working capital that will be used by the business. Lockup times can range, but will typically be more than a year.
  • You have to meet the criteria first. Although crowdfunding isn’t as esoteric and niche as it used to be, there are still some requirements for investors. As mentioned, there are limits to how much you can invest based on your income and net worth.
  • You kind of need to know what you’re doing. Don't let your excitement to get in on the ground floor cloud your judgment. Understand the business you're investing in, the risks associated, and the type of crowdfunding the company is offering (rewards, donation, debt, and equity)—an obvious first step. 


Are we in a housing bubble?

In case you haven't noticed so far this year, everything related to the economy and investing is a bubble. Or at least, potentially anyway. If you look at the Google trends data for the search term “housing bubble” over the course of the last 12 months, you’ll notice an undeniable jump in search volume for this topic and particularly so over the last month. 

The media has found another buzzword to latch onto, but there seems to be a plausible reason for this.

How did we get here?

The thought that we may eventually find ourselves trapped in another housing bubble is the result of a culmination of factors that have all coalesced perfectly over the last year. The pandemic was kind of the spark that lit the fire when it began causing supply shortages and straining supply chains around this time last year, but it was soon joined by other issues. 

Mortgage rates have been at some of their most favorable rates ever. Today, you can find 30-year fixed-rate mortgages ranging from about 2.6-2.8% and a 15-year fixed rate for lower than that. Millennials are also reaching the prime age to buy a home, further increasing demand on an already low supply.

The implications on home prices

Most homes are having trouble remaining on the market for more than a month, and sometimes for much less in high-demand areas. Rates are great and demand is high amongst both investors, contractors, and your classic homebuyers, creating a situation where the competition is more than stiff.

Prospective home buyers are more often than not being required to put forth the full 20% down or more, while also competing with all-cash parties that have increased from up to 23% over the last year. All of this pent-up demand combined with the temporary shortage has created an undeniable bubble of sorts, with prices squeezing higher.

Relief on the way...maybe?

Luckily for those looking to buy a home in the next few years, we should expect some level of normalization to level out the housing market as time goes on. Contractors are aware of the demand and want to build, only being limited by our near-term supply shortages, higher lumber prices, and local skilled labor deficits. Regardless though, new home starts have increased by 20% this March—the highest increase we’ve seen since 2006.

While adding more supply to the market will undoubtedly provide some relief to home prices, other factors like mortgage rates, unemployment, and overall financial stability amongst homebuyers will all need to cooperate as well. Experts are in relative agreement that things will level out, but buyers should still remain wary for the time being.

🧵 Have some thoughts on this topic? Join the thread:


Invest in the future of pizza

The US buys $46.3B worth of pizza annually. Here’s how to get a slice of the pie.

We’re talking about the future of pizza, and luckily, it has nothing to do with waiting 30 minutes for some random person to make your pie.

Enter Piestro, the robot pizzeria that’s baking high-quality, artisanal pizza in just 3 minutes and at a fraction of the cost of traditional pizzerias.

4 key ingredients that have investors drooling over Piestro:

  • Fully autonomous machines designed to achieve zero contact food preparation, zero food waste, and much lower operating costs, resulting in higher profit margins.
  • Backed by Wavemaker Partners – a global venture capital group with more than $400M AUM.
  • Dual go-to-market approach: Piestro-operated pods and white-labeled units allowing existing pizzerias to grow market share for a fraction of the cost.
  • Led by a distinguished team of founders/execs from Wolfgang Puck, Miso Robotics, Kitchen United, Graze Autonomous Mowers, and more.

🍕 Invest while it’s hot


Is going broke a must for NFL draftees?

How many articles and documentaries have been published about professional athletes and their money problems? The amount of insanely talented young men that seem to fumble all their sudden riches and then be antagonized by the public is more than noteworthy, and it’s fair to question what the common denominator might be here. 

Some statistics point to numbers like 78% of former NFL players going bankrupt or having some amount of financial hardship within just the first two years of their retirement. The NBA’s numbers sit at about 60%. This is only slightly better, but maybe that’s the result of guaranteed contracts and a more resounding players union with better relations.

Why does it keep happening?

The biggest recurring theme behind this is of course the unabashed levels of spending, which is a common symptom of someone who’s just acquired a lot of money in a very short period of time. We see the same trends with lottery winners, and it’s clear that sudden abundance does dizzy our judgment a bit.

This, combined with the desire to impress and validate oneself, a lack of preparation, budgeting, and guidance all culminate to result in some unwise financial decisions, often in a serial pattern that results in the number of bankruptcy declarations.

This trend isn’t something that only athletes are prone to, it obviously occurs all the time with regular citizens who just aren’t reported on. There are some common practices that those who avoid these missteps have in common though, and things you should already be doing as well.

  • Budgeting: So obvious and simple, yet so important. Budgeting is just the financial version of planning and preparing, and we all know that doing things with intentionality and certainty leads to better results in all areas of life.
  • Seeking sound counsel: Just because they’re your mom, your spouse, your partner, your boss, or whomever it may be, doesn’t mean they give sound financial advice. Age doesn’t necessarily equate to wisdom, and neither does emotion or heuristics. Get input from a myriad of sources and doubt them all like Rene Descartes to the point that you develop a solid, objective financial outlook and plan for your money.
  • Understanding that your invested money can make more money efficiently: That compounding interest and returns on your invested money can lead to exponential market gains over many years is no joke. Unless you’re hauling in a massive salary, your money can out-earn you with ease and in half the work. You’ll get wealthier by investing it than saving or spending it.


  • Tech is under pressure again. Apple, Google, Facebook, Tesla (-2%)
  • Cyclicals such as Boeing (-2%) are also not doing too well
  • Virgin Galactic (-20%) after reporting higher than expected losses
  • L Brands (-2%) after the firm decided to spin off Victoria Secret
  • Palantir (-7%) even after profits came in line and revenues topped estimates 
  • Hanesbrands (-11%) is also down despite topping revenue and profits; its guidance was less than optimistic
  • Novavax (-12%) after the firm delayed its request for approval of its COVID vaccine

Thanks to our good friend & investment market guru, Ashu Singh, for today's movers & shakers. If you have feedback about this new section, please share them in the feedback form below or email us at


  • It's raining money. What happens when it stops? (WSJ)
  • Warren Buffett: Picking winners is really, really hard (Yahoo! Finance)
  • 25 best places to live in the U.S. for quality of life (Yahoo!)
  • Finny lesson of the day. With markets taking us on a very regular rollercoaster ride, brush up on what it means to rebalance your portfolio and how to do it:

Finny is a personal finance education start-up offering free, game-based personalized financial education, a supportive discussion forum, and simple stock and fund tools (aka Finnyvest).  Our mission is to make learning about all things money fun and easy! 

The Gist is Finny's newsletter to our community members who are looking to make and save more money, protect their finances and be their own bosses!  It's sent twice a week (Tues & Thurs). The editorial team: Austin Payne and Chihee Kim; Ashu Singh for Today's Movers & Shakers.

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