What is the cardone capital minimum investment?

Cardone Capital offers real estate crowdfunding for accredited and non-accredited investors. As a novice real estate investor, I wondered: What is the Cardone Capital minimum investment?

Turns out the answer is surprisingly simple. Cardone Capital minimum investment: The Cardone Capital minimum investment is $5,000 for non-accredited investors. For funds that are only available to accredited investors the investment minimum ranges between $100,000 and $250,000 and varies by fund.

In this post, you will find out what the minimum investment is for Cardone Capital a fund ran by Grant Cardone. We will look at the different investment minimums per fund and compare rates between funds for accredited vs. non-accredited investors.

Finally, you’ll also learn why the minimum investment varies so much and how you can invest in real estate even under Cardone Capital’s minimum investment.

Does Cardone Capital have a minimum investment?

Yes, Cardone Capital sets minimum investment amounts for all of their funds. However, the minimum investment frequently varies by investor type or fund size.

If you need a better overview of Cardone Capital I have an article for a Cardone Capital Review.

Surprisingly, the answer to this simple questions is not that easy to find. Even Cardone Capital’s own FAQ does not directly address this question:

The easiest way to find out what the minimum investment is for Cardone Capital is to actually sign up and look at the current offerings.

Once you’re signed up and take a look at the offerings page you will find the minimum investment for each fund in the top right corner of the offering card:

Minimum Invest per Fund

Here’s an overview of the current minimum investment per fund:

Fund	Minimum Investment
Cardone Equity Fund V, LLC	N/A
Cardone Equity Fund VI, LLC	$5,000
Cardone Equity Fund VIII, LLC	$50,000
Cardone Equity Fund IX, LLC	$250,000
Cardone Equity Fund X, LLC	$250,000

However, the minimum amount for some funds is actually not visible from the offerings list.

To find out the minimum investment amount for these type of funds we’ll need to click on the fund offering and then on ‘Invest Now’.

This will bring up the transaction center. The investment commitment is then displayed at the bottom left:

For this fund the minimum investment is only $5,000 – the lowest there is.

As you can see, the minimum investment per fund varies quite a lot. This is due to the type of investor each fund is geared towards.

Typically, the more qualified the investor profile is for each fund, the higher the minimum investment.

Minimum Investment for Accredited Investors

For accredited investor funds, the minimum investment will be a lot higher than for non-accredited investor funds. Here the range of minimum amounts starts at $50,000 and goes up to $250,000 for Cardone Capital’s most exclusive funds.

In return for this high minimum commitment, accredited investors receive preferred Cardone Capital returns and access to better properties.

Minimum Investment for Non-Accredited Investors

For non-accredited investors, the minimum investment is $5,000. In return, non-accredited investors will also get access to similar quality multi-family investment properties but receive less return of the operating cash flow.

With a $5,000 minimum investment you can expect a return of 5-6% cash-on-cash. The total return for most non-accredited funds is advertised as 15%. There are currently no funds that Cardone Capital offers that have a lower minimum investment than $5,000.

Why does the minimum investment vary?

There are several reasons why the minimum investment might vary per fund and also per investor profile. First, let’s look at the difference in funds:

The difference in minimum investment by funds

Cardone’s equity funds are structured in similar ways but include a variety of different properties. Some properties are simply more expensive to acquire or require higher ongoing maintenance costs.

However, since Grant usually closes the deals before even funding the investment cash flow is not the reason for the varying minimums. The more probable reason that some funds are just harder to get into is exclusivity.

By setting the entry-level way higher than common investors can afford, Cardone Capital is able to attract high-net-worth investors seeking superior returns. And these returns are offered in the form of preferred returns from operating income.

The difference in minimum investment by investor type

When it comes to investor types Cardone Capital also sets different investment minimums. The more qualified and professional the investor is, the higher the minimum investment.

The reason for this is simply the reduction of administrative costs.

The lower the minimum investment is, the higher the number of individual investors that participate in a fund. This increases customer support queries and accounting costs for tracking and managing each individual investment.

Another reason for distinguishing between accredited and non-accredited investors is the fact that accredited investors tend to be more experienced and require less regulatory concern from the syndicator.

Other options below $5,000

If even Cardone Capital’s lowest minimum investment of $5,000 is to steep for you, don’t despair!

There are other options to invest in real estate syndications available to you.

Fundrise offers a simple and excellent way to increase your exposure to real estate and the minimum investment is just $500.

With their eFunds, you will also be able to invest directly in real estate instead of owning a share of a REIT.

If this sounds like a viable option for you check out this post I wrote a few weeks ago comparing Cardone Capital vs Fundrise.

Best Alternative Is Grondfloor

Can Anyone Invest in Cardone Capitol?

Cardone Capital offers private real estate fund investing to average retail investors. However, some investors may be excluded from investing with this private offering. I did some research and contacted Cardone Capital to find out who exactly can invest in their funds.

Anyone can invest in the Cardone Equity Funds. These are funds for accredited investors and are open to U.S. as well as international persons. In their non-accredited investment fund, on the other hand, only US persons can invest. These are US citizens or residents, US partnerships, corporations or entities.

In this post, we will look specifically at who can invest in Cardone Capital, whether non-accredited investors can also invest, if foreigners can invest in Cardone Capital and what the minimum investment amount is.

Who can invest in Cardone Capital?

As mentioned earlier, Cardone Capital restricts access to its funds depending on the type of fund and depending on the type of investor. However, as a general rule, no more than 10% of your annual income or net worth may be invested in any of the funds on offer.

Furthermore, US persons who are planning to invest in the funds must not be subject to backup withholding tax with the IRS. When it comes to non-accredited funds, only US citizens or residents, US partnerships, corporations or entities or US estate or trusts may invest.

Foreign investors are excluded from this type of investment. Cardone Capital non accredited investors who are foreign investors may take advantage of that.

Can non-accredited investors invest in Cardone Capital?

Non-accredited investors are individual individuals whose net worth does not exceed one million dollars or whose income is less than $200,000 per year. These types of investors usually have to deal with restrictions set by the Securities and Exchange Commission (SEC) and are thus limited in their investment choice with Cardone Capital.

I compared Fundrise vs Cardone Capital to see where you money should go for real estate diversity.

Some funds are also restricted to accredited investors only. On the other hand, some funds are also open to non-accredited investors. But these funds generally do not offer a preferred cash-on-cash return.

Conclusively, non-accredited investors may also invest with Cardone Capital but will get a slightly worse offer. This is likely due to the additional hassle and regulation that is associated with non-accredited investors and entities.

Can foreigners invest in Cardone Capital?

As mentioned in the previous paragraph, there is also a distinction between US and international investors when it comes to the type of fund that is open.

Cardone Equity Funds are those with the aforementioned preferred return that are open to accredited as well as foreign investors.

The regular funds that do not pay out a preferred return are open to non-accredited investors but not to foreign investors. So, in the latter one, only US persons and entities may invest.

The same restrictions and regulations as with non-accredited investors also apply to foreign investors, according to the SEC.

What is the minimum to invest in Cardone Capital?

I have written an entire article on the minimum investment for Cardone Capital.

In brief, the minimum has long been 5,000 USD for most funds, and recently Cardone Capital has increased this minimum investment amount to $10,000 for their newly opened funds for non-accredited as well as for accredited investors.

If you are an accredited investor and wish to invest in the Cardone Equity funds that pay a preferred return, the minimum investment amount will typically be $100,000.

What type of investment is Cardone Capital?

One of the main advantages of investing with Cardone Capital is that you will be a shareholder and a member of a limited liability corporation and thus will receive preferential tax treatment.

Instead of receiving a common 1099-DIV tax form from the IRS, you will receive a K-1 form which will entitle you to deduct the depreciation of the asset from your taxable income.

This is because Cardone Capital is a real estate syndicator that offers an investment in private equity funds, which are set up as LLCs.

The Verdict: Grant Cardone Capital Minimum Investment

Cardone Capital has made real estate crowdfunding available to everyone. Well, everyone with at least $5,000 to invest.

Although the minimum investment varies by fund and by investor type, the absolute minimum you will need to invest with Cardone Capital is $5,000.

Their higher quality funds that offer better investment conditions and preferred returns often start at $50,000, $50,000, or even $250,000.

These are usually reserved for accredited investors. Check out Groundfloor if you want some for non accredited investors and diversify into real estate debt.