Looking for Optimized Portfolios? Click here.
Dashboard Update  

Updated Summary Section

We’ve updated our summary page to make it easier to see how your account is doing, by highlighting your total account value and your paid earnings. The “Total Account Value” graph makes it easier for you to see how your account’s value has changed over time, and the Portfolio Statistics summarizes your current allocations. Though the investment footprint is not a new feature of the AlphaFlow Optimized Portfolios dashboard, it is our clients’ favorite visualization tool! In a single shot, you can see where your loans are allocated across the country. Portfolio Summary

Click on the image to enlarge it.

New Analytics Section

Our new analytics section provides you with more transparency into your investment.  We’ve added a new panel to summarize what states your notes are in, and added a section that shows the servicing status of the notes in your portfolio. Missed payments are a fact of life investing in real estate. With many borrowers out swinging hammers and not at their computers, many perfectly healthy loans will miss some payments. This is why lenders don’t consider a loan in default until a borrower is 60 days late (delinquent) or more on a payment. Even then, it could be because they’re in the middle of selling or refinancing the property and are awaiting a payment before paying off all the back interest and the loan all at once.  Be assured, we’re always on top of our lenders to understand what’s going on with the loans in your portfolio, delinquent or otherwise! Top States and Note Status

Click on the image to enlarge it.

With the introduction of our monthly statements, we made it easier to understand what happened in your portfolio each month.  The “Account Activity” section takes a step further, and gives you a summary of each month’s activity in a single place, showing all account inflows and outflows! Monthly Activity Demo

Click on the image to enlarge it.

Disclosure: All data presented here is for demonstration purposes only. Past performance is not indicative of future returns. Nothing in this article should be construed as a solicitation or offer, or recommendation, to buy or sell any security. Investors should consult with their own legal, financial, and tax advisors. While AlphaFlow strives to make the information in the article as timely and accurate as possible, AlphaFlow makes no claims, promises, or guarantees about the accuracy, completeness, or adequacy of the contents of this article, and expressly disclaims liability for errors and omissions in the contents of this article.
I Want a Fully Optimized Portfolio
  AlphaFlow Optimized Portfolios   “Know what you own, and know why you own it.” – Peter Lynch This week marked a big milestone for us here at AlphaFlow, as we hit one year since launching AlphaFlow Optimized Portfolios! Our vision at AlphaFlow is to unlock the world’s opaque markets, and we do that by making it easy to invest in previously inaccessible asset classes. After launching the industry’s first multi-lender funds in 2016, AlphaFlow Optimized Portfolios (or “AOPs”) were about taking the next step and giving clients an unprecedented experience: an automated real estate investment platform. You make one investment, and we build you a diversified portfolio of real estate bridge loans. It’s that simple. One year later, the platform is working very well. Transparency is one of our core values and so we wanted to share some portfolio statistics and insights. To start, here is a bit about our last 12 months:

AlphaFlow Optimized Portfolios (as of 3/5/18)

AOP Stats   The missing statistics are our actual yield on our investments and total AUM. To produce our offering, we needed to become a registered investment advisor with a fiduciary obligation to our clients, meaning we’re bound to put your interests ahead of our own. Being a regulated entity comes with restrictions though, including those around showing performance, so we unfortunately can’t share these metrics. That said, our fiduciary duties align nicely with our culture of credit over volume. Our underwriting, led by our Director of Investments, Miles Deamer, has been conservative. The results speak for themselves: after one year our delinquency rate* is an astonishingly low 1.66%! To illustrate, you can see that our LTV actually decreased over time:  

Daily Weighted LTV

Daily Weighted LTV Our investments have been spread across the country, providing clients with tremendous geographic diversification:  

Current AOP Geographical Diversification

AOP Geographical Diversification   Our clients have been pleased, perhaps demonstrated best by the additional capital they’ve added to their accounts after launching their AOP. In fact, the average annualized growth rate of a portfolio after it’s been opened is 69% (ie clients are almost doubling down on their initial investment after experiencing the platform). Real estate bridge loans offer very attractive returns, but we’ve experienced the immense challenges that come with this asset class as well. Our 90%+ rejection rate tells you how much work we think it takes to find good investments. In addition, “cash drag” can absolutely kill returns. These loans typically have 12 month maturities, but we’ve found the actual average duration to be closer to 6.5 months and so making sure your money isn’t just sitting in your account and dulling your returns is critical. Our auto reinvest feature, which almost 80% of our clients use, makes this effortless and usually reinvests repaid capital within a matter of days. As we look to the next year, our focus is on a few areas: What else would you like to see? You can always reach me and the wider investment team directly at ray@alphaflow.com and invest@alphaflow.com, respectively. It’s been an incredible first year and we’re excited as we embark on the next step in our journey!  
I Want a Fully Optimized Portfolio
    *Delinquency rate defined as dollars invested in loans that are 60+ days delinquent on payment, divided by total active dollars invested.

About the author:

Ray Sturm, CEORay Sturm is a leading entrepreneur in financial technology, and is currently the CEO of AlphaFlow. Prior to launching AlphaFlow, he founded RealtyShares, one of the P2P industry’s top platforms for real estate investing. His early career in finance included investment banking at Bear Stearns, restructuring at Lazard Frères and private equity at CCMP Capital.

Ray has a BBA-Finance from the University of Notre Dame and a JD/MBA from the University of Chicago.

Legal Information and Disclosures This memorandum expresses the views of the author as of the date indicated and such views are subject to change without notice. AlphaFlow has no duty or obligation to update the information contained herein. Further, AlphaFlow makes no representation, and it should not be assumed, that past investment performance is an indication of future results. Moreover, wherever there is the potential for profit there is also the possibility of loss.  This memorandum is being made available for educational purposes only and should not be used for any other purpose. The information contained herein does not constitute and should not be construed as an offering of advisory services or an offer to sell or solicitation to buy any securities or related financial instruments in any jurisdiction. Certain information contained herein concerning economic trends and performance is based on or derived from information provided by independent third-party sources. AlphaFlow Advisor, LLC (“AlphaFlow”) believes that the sources from which such information has been obtained are reliable; however, it cannot guarantee the accuracy of such information and has not independently verified the accuracy or completeness of such information or the assumption on which such information is based.  This memorandum, including the information contained herein, may not be copied, reproduced, republished, or posted in whole or in part, in any form without the prior written consent of AlphaFlow. 


Today, I am excited to share some big news about AlphaFlow! As you may have seen us announce in Bloomberg , AlphaFlow has closed our $4.1 million venture capital seed round with a group of incredible investors from both the technology and traditional finance worlds.

The round was led by Resolute Ventures and Point72 Ventures, the venture arm of Steve Cohen’s Point72 Asset Management. It also included participation from distinguished firms like Social Capital, Upside Partnership, and Red Swan Ventures.

Last March, we launched the first automated real estate investment platform. Today, within days of receiving an investment, we’re typically able to place our clients into unique portfolios of 80+ loans across 20+ states. That’s not an improvement on the industry. That’s absolutely reinventing real estate investing. Our company has embraced a culture of credit over volume, which has resulted in a default rate roughly 50% of what we typically see in the industry.

Building a Fintech company that truly changes the investment world requires you to both harness technology and leverage the capital markets. With that tremendous challenge in mind, it’s hard to have better partners than we have brought together here. When groups with the financial and investment expertise of Point72 break down your business and ultimately decide to invest, it’s not only great validation but also a chance to work with some of the industry’s sharpest minds who will improve every piece of our business. Ultimately, that means your portfolios will get even better.

This round will enable us to expand our engineering and data science teams responsible for our analytics suite and investment algorithms. We’ll also expand our lender relationships to allow us to evaluate more investment opportunities while maintaining an underwriting bar that today has us rejecting over 90% of loans we evaluate. Looking forward, we’re working on adding more asset classes as well as the ability to build a customizable portfolio for each and every client.

None of this would be possible without our clients, partners, investors, and all those who have worked closely with us to build the best possible platform. Thank you so much. We’ve come a long way, but we’re just getting started! And we look forward to growing with all of you.

Ray Sturm CEO & Founder alphaflow.com
I Want a Fully Optimized Portfolio
SAN FRANCISCOSept. 20, 2017 /PRNewswire/ — AlphaFlow, an automated alternative investment platform for real estate, announced today the closing of a $4.1 million seed round funding, led by Resolute Ventures and Point72 Ventures, the venture capital arm of Steve Cohen’s Point72 Asset Management. Other investment partners include Upside Partnership, Social Capital, Y Combinator, Clocktower Technology Ventures, an affiliate of Drobny Capital, Red Swan Ventures, and more.
AlphaFlow’s seed round comes two years after the company was established by CEO and former RealtyShares Co-Founder, Ray Sturm. AlphaFlow plans to use the funding to continue scaling successful partnerships with lenders and investors, both accredited individuals and investment managers.  Additionally, the company will build out its team, particularly the data science and engineering division responsible for the development of its analytics suite and investment algorithms. “We are providing investors and financial advisors with the resources they need to diversify their portfolios with real estate through cutting-edge technology and data analytics,” said CEO, Ray Sturm. “We are honored and proud to be backed by such esteemed firms and excited about the deep domain expertise in investment management they bring to the company. This funding will enable us to grow even faster and continue to reinvent real estate investing to match what our clients want: a diversified and 100% passive experience that is transparent, aligned with their best interests, and focused on identifying the most favorable risk-return opportunities.” AlphaFlow Optimized Portfolios are available for investment professionals such as endowments, pension funds, RIAs, and wealth managers, as well as by independent investors seeking uncorrelated returns through short‐term, higher‐yielding real estate loans backed by properties. “What we look for is extraordinary founders on a mission to upend massive industries stuck in their old model,” said Mike Hirshland, Co-Founder of Resolute Ventures. “With Ray and real estate finance we have both in spades, and are thrilled to be on the AlphaFlow team.” To date, AlphaFlow’s flagship product, AlphaFlow Optimized Portfolios, boasts broad diversification across hundreds of loans in 29 states, average LTV of 72%, and target net returns between 7.5 to 9%. With this seed round funding, AlphaFlow intends to continue to innovate in the application of sophisticated finance mechanisms to scale within the investment industry. About AlphaFlow AlphaFlow is the first and fastest-growing automated real estate investment management service, offering automatic portfolio diversification for real estate investments. The firm applies data, analytics, and technology to create broadly diversified, passive income-producing portfolios without the high fees and high minimums of traditional real estate investing. Launched in 2015, AlphaFlow Advisor, LLC is a registered investment advisor based in San Francisco, CA. For more, visit staging.alphaflow.flywheelsites.com.
I Want a Fully Optimized Portfolio
  Our promise is truly passive real estate investing, and unprecedented diversification in the real estate loan asset class through AlphaFlow Optimized Portfolios. Throughout March and April, we delivered on our promise, and exceeded even our own expectations. We’re happy to say that as at the end of April, all investors with an AlphaFlow Optimized Portfolio were invested in at least 78 loans spread across 24 states! The portfolios are exceeding their targets with a blended net return of 9.04% and LTV of 70.95%, offering a strong return with an attractive equity cushion.

Geographic Diversification

Geography is one of the many elements of diversification offered by AlphaFlow Optimized Portfolios. The map below shows where loans are currently dispersed across the country. When invested, a client will see his or her own personal dashboard that includes a map of loans in the portfolio.

How Do We Build AlphaFlow Optimized Portfolios?

”‹”‹AlphaFlow AlphaFlow Optimized Portfolios target: returns of at least 7.5-9%; allocations of at least 75 unique investments spread across 15 or more states; and a maximum loan-to-value of 75%. AlphaFlow Optimized Portfolios Factors With the express intention of making the experience of investing with AlphaFlow completely passive, once you have transferred funds, we do the rest. AlphaFlow portfolio managers select, rebalance, and manage your portfolio for you with the help of smart automation, algorithms and analytics. You receive monthly earnings right to your dashboard and accounts, which you access through the online portal.

”‹”‹Questions About Alphaflow Optimized Portfolios?

We recognize that AlphaFlow Optimized Portfolios are a unique way of investing in real estate loans, especially the high level of diversification and passive investment approach (to the investor). Many people are coming to us as existing investors on real estate crowdfunding platforms. Here are a few common questions we get, in addition to what is available on our Frequently Asked Questions page.

Q: What is the minimum investment amount?

A: The minimum investment is $10,000. Given that your portfolio may be split across 100 individual loans, AlphaFlow targets a minimum value of $100 in each loan by the time each portfolio is optimized.

Q: Can I select my own investments?

A: AlphaFlow builds your Optimized Portfolio for you and does all of the work, so you don’t have to go through the trouble of finding, underwriting, and investing in each loan one by one. We’ve built a proprietary system to take that work off your shoulders. As a result though, investors today can’t choose their own investments.

Q: Is everyone invested in all the same loans?

A: AlphaFlow’s team is investing in loans we like around the industry on a daily basis. When you invest and we receive your capital, we allocate you slices of loans in which we have availability at the time. This changes on a daily basis, so depending on when you invest, you may have overlap with other customers but you’ll likely have a unique portfolio from most other AlphaFlow clients. All loans will fall within the same standards of underwriting.

Q: How does this compare to hand selecting loans on other real estate investment platforms?

A: On most platforms, investing in 6-12 loans often means a minimum investment of $30-60K. With AlphaFlow, you are automatically placed into 75-100 loans, all with a minimum investment of $10K.

Looking Ahead”‹

We’re continuing to add notes almost every day. With our current inventory of loans, new investors will now be placed into more than 70 loans within days of funding their accounts and quickly achieve tremendous diversification.


Today AlphaFlow is excited to launch a revolutionary investment platform unlike anything on the market. For the first time, investors can 100% passively invest in a diversified real estate portfolio at any time. It is ultimately a simpler, more intelligent way to invest in real estate.

Real estate investing has evolved at a rapid pace over the last 5 years and those of us at AlphaFlow have been at the forefront at each step. In 2013 I co-founded what is today one of the largest real estate crowdfunding platforms in the country: RealtyShares. For the first time, we made it possible to invest in residential and commercial real estate with as little as $5,000. It also gave me a unique perspective in understanding how platforms around the industry source and underwrite deals, along with the inherent pressure to move underwriting standards in order to stimulate growth.

In 2016, Bogdan Cirlig and I launched the industry’s first multi-platform funds. With one investment of as little as $10,000, our clients got a diversified portfolio of 75 to 100 loans sourced from the real estate crowdfunding industry’s top platforms. For investors, this meant that in just a few years they had gone from needing to write checks that were likely six figures, to now being able to invest as little as $100 in a first lien mortgage! Simply incredible.

Our funds invested in over 230 real estate loans in more than 25 states around the country. Each fund was exceeding the return target, and feedback from our clients was exceptional. We weren’t meeting all of their needs though, so we stepped back and designed a new platform from the ground up. We needed to build the next evolution of real estate investing.

At AlphaFlow, we believe in challenging the status quo in investing so that every investor has access to the best investments without needing to have millions of dollars to invest. To do that, we use top-caliber analytics and technology to create an elegant automated investing experience. Today we’re introducing AlphaFlow Optimized Portfolios to help fulfill that mission.

AlphaFlow Optimized Portfolios

The Result: You get a diversified portfolio of the best loans from the best lenders, all with one investment.

For our fund investors, there were three major improvements here that fundamentally changed the investment experience:

  1. We’ve virtually eliminated all cash drag. Within a few days of receiving your capital, you will begin earning returns on your entire investment.
  2. You can invest and re-invest capital at any time.
  3. We continually rebalance your portfolio to keep you diversified as loans repay.

Thirty years ago, to trade stocks you might have needed to call your financial advisor at Dean Witter. Firms like E*Trade and Schwab changed that with online platforms and made trading cheaper and easier for everyone. Today, robo-advisors like Wealthfront and Betterment are applying Jack Bogle’s lessons online with equity portfolios. Today is a big step in AlphaFlow bringing that same philosophy to real estate. Welcome to the future of real estate investing. Welcome to AlphaFlow!

  Note: AlphaFlow is available today for all accredited investors. If you enjoyed this post, sharing it on Facebook, LinkedIn or Twitter with the links below is the highest form of flattery. Thank you!

About the author:

Ray Sturm, CEORay Sturm is a leading entrepreneur in financial technology, and is currently the CEO of AlphaFlow. Prior to launching AlphaFlow, he founded RealtyShares, one of the P2P industry’s top platforms for real estate investing. His early career in finance included investment banking at Bear Stearns, restructuring at Lazard Frères and private equity at CCMP Capital.

Ray has a BBA-Finance from the University of Notre Dame and a JD/MBA from the University of Chicago.

back to top