Raising Venture Capital When Emerging Companies Need to Pivot
When the U.S. real estate market took a downturn starting in 2022 amid high inflation, rising interest rates, and constrained capital, the founders of startup real estate platform Yieldeasy knew they had to make a strategic change. And they needed capital to do it.
They turned to Ballard Spahr and attorneys in the firm’s Emerging Companies and Venture Capital Group, who advise emerging companies on designing, negotiating, and executing venture capital transactions—including for startups that need to adjust to changing market conditions.
Yieldeasy was formed in 2021, originally as a platform to service prospective apartment building purchasers. Recently, the company completed a financing round for its pivot to a platform for alternative real estate investing.
“The online platform now affords accredited investors access to real estate debt as an asset class,” said company cofounder Jeff Gopshtein.
Gregory L. Seltzer, co-leader of the Emerging Companies and Venture Capital Group, and Richard L. Catalano, an associate in the Group, worked with Yieldeasy to negotiate, document, and close the transaction to raise capital to make the pivot work.
The transaction is one of numerous deals the Group has helped close despite a down market over the past 18 months, where raising funds has been challenging for many startups.
It’s an example of how the Group’s attorneys help emerging companies thrive—from entity formation to angel and seed financing to preferred financing rounds, and ultimately through sale or initial public offering. Investors rely on our team to evaluate deals, assist with due diligence, negotiate financing terms, draft documentation, and structure and close transactions efficiently. Clients benefit from our vast network of relationships with entrepreneurs, venture capital and private equity firms, angel investors, investment funds and banks, and public companies that invest in emerging companies.