Relli co-founder and CEO Mor Milo joined Adam Torres on Mission Matters to talk about why he started Relli and how it planned to open real estate investing to more people. They cover Mor's family story, how Relli chose which developers to work with, the types of offerings it planned, and why investor education mattered to the team. The episode, "Relli is Positioning Itself as 'The Stock Market of Real Estate'," was released April 19, 2024 and runs 19 minutes.
Editor's note: first published April 2024, before Relli launched, so many details have changed. Relli no longer offers $100 investments, commission-free investing or the transaction fees described here. Today Relli is a marketplace where investors review offerings from reviewed sponsors, express interest and talk to each sponsor directly. Each offering page shows its own minimum. Target returns are projections, not guarantees.
Watch on YouTube, or listen on Apple Podcasts or Spotify.
Key takeaways
- Mor's mission is to level the playing field for everyday investors, shaped by watching his immigrant parents build wealth through rental property.
- He and his business partner started Relli after looking for a way to invest a few thousand dollars in real estate without becoming landlords, and finding few good options.
- Relli's sponsor review focused on the people running each business and their track record. Mor said the team wanted at least five years of results, and usually ten.
- Mor saw developers, not investors, as the ones paying for the platform, in exchange for reaching new investors.
- Education was a priority from the start: Mor says most of the knowledge needed for this kind of investing is passed privately between professionals.
Full transcript
Lightly edited for clarity. Section times match the YouTube video.
Welcome and the Mission Matters Minute (0:00)
Adam Torres: Hey, I'd like to welcome you to another episode of Mission Matters. My name is Adam Torres, and if you'd like to apply to be a guest on the show, just head on over to missionmatters.com and click on Be Our Guest to apply. All right, so today I have Mor Milo on the line, and he's a founder and CEO over at Relli. Mor, welcome to the show.
Mor Milo: Thank you so much for having me. Excited to be here, Adam.
Adam Torres: All right, Mor, so Relli is positioning itself as the stock market of real estate, so I'm excited to get into that and learn more about Relli. But just to get us kicked off, we'll start this episode the way we start them all, with what we like to call our Mission Matters Minute. So, Mor, at Mission Matters, our aim and our goal is to amplify stories for entrepreneurs, executives and experts, and that's what we're doing day in and day out. Mor, what mission matters to you?
Mor Milo: The mission that matters to me is finding ways to level the playing field for average Joes. As an immigrant, someone who came to this country at four months old from a completely different country, and watched my parents grow and start to understand what the American dream looks like, it's always been part of my mission to find ways to give back to average Joes and help level that playing field, so we can keep that American dream alive.
When did Mor get into real estate? (1:20)
Adam Torres: Man, that's awesome. I love bringing mission-based individuals on the show to share why they do what they do, how they're doing it, and what we can all learn so we can all grow together. So great to have you on. And to get us kicked off, we're talking about real estate today. Before Relli, before all of that, when did you get into real estate? When did you catch the bug?
Mor Milo: Interestingly enough, I've been part of a family that has dabbled in real estate and long-term investing, and I watched my parents buy a couple of properties here and there growing up. Again, immigrants doing it the immigrant way: coming into the country, working their butts off, putting some money in their savings, living a frugal life, and then taking those dollars and investing them into real estate assets they could turn into passive income. I watched how they did it and how they grew into a few properties, and then a few more.
Funny enough, the biggest reason we're here is because of that story. We got an opportunity to see how difficult it was to be a landlord: building real estate, managing real estate, managing tenants. That was part of the journey to where we are, and to why we decided to democratize this beautiful investment strategy that has become a little unattainable in today's market.
How did the idea for Relli come about? (2:39)
Adam Torres: How did Relli come about? Was it a progression? Was it one of those aha moments? How did the concept for the platform come about?
Mor Milo: I have one right-hand business partner who's been my ride or die for the last seven years. We've gone through a few different projects together, projects that failed and projects that were semi-successful, and we got to a point where it was me and him against the world. We said, "You know what? What's important to us?" We looked at our financial planning and asked what types of assets we currently had. Between the two of us, we like to invest in stocks. We love cryptocurrencies. We love learning about finance and finding ways to become successful through investing.
The next step in our journey as investors was to go and purchase real estate. At that point in our lives, we said, "Okay, we just came out of a failed business. We're a little light on cash. How can we invest in real estate today?" So we started doing some research: where can someone like me, an average Joe, go and put $5,000, $1,000, $500, whatever, into some form of real estate, where they can get a piece of the action on the rental income and a piece of the action on the profit? There were a few options out there, but nothing really inclusive that could bring everyone across the country together to invest in real estate. So we said, "You know what? Let's build it ourselves."
We've now been in this game for give or take two years, and we've come to a wonderful crossroads where we're about to launch our platform, where retail investors, average Joes like me and you, can invest as little as $100 into a piece of real estate. What we're building is the stock market of real estate.
What made Relli's approach different? (4:33)
Adam Torres: And so what makes this platform a little different from some of the other fractionalized programs out there? What makes it unique?
Mor Milo: Let's take a step back. What is the stock market? The stock market is a place where companies from all over the country, maybe even all over the world, offer shares in their business to average consumers, so they can participate in the growth of that business. Because we're building a stock market of real estate, we want to find ways to fractionalize real estate and create opportunities.
The way we've chosen to find opportunities for retail investors to invest in different real estate is by finding the best developers across the country: the SMB guys, the small and medium-sized businesses, the mid-market developers that maybe are a little further in their journey, but overall the ones with a particular type of real estate they're really good at, and a track record of success in delivering returns back to their investors, or a good track record of building revenue through real estate investing. So our "stocks" are based on SMB and mid-market developers across the country who offer real estate opportunities to average Joes.
How did Relli choose which developers to work with? (5:57)
Adam Torres: And how are you choosing which developers to work with, or which projects? I'm just curious how that piece of it works.
Mor Milo: That's the most important part, right? You want to make sure you have the best possible deals on the platform. Thankfully, our team has wonderful experience in underwriting and managing risk, understanding how to look at different principals, and ensuring that we only work with the cream of the crop, the top 1% of developers across the country. The way we do that is a deep due diligence dive into the principals running that business and their previous business endeavors. We only take the ones with a track record of success at least five years long. Usually we don't want anyone with less than 10 years, because we want to ensure we only bring the highest-quality investments to our retail investors.
What types of offerings did Relli plan? (6:49)
Adam Torres: In the normal stock market, to take your analogy a little deeper, they might sort by market cap for the different types of stock: small cap, large cap, mid cap. How is somebody going to be able to segment investments on this particular platform?
Mor Milo: That's an awesome question. One of the biggest things that differentiates us is that we have a lot of different types of offerings we can put on our platform. Just like a stock market, we'll have options in single investments, single properties. We'll have funds, which are a consolidated portfolio of real estate sponsored by a particular principal, a good developer. And we'll also have opportunities for debt-based investment, where you provide some form of debt to a developer and they aim to pay you back a preferred return on a consistent basis.
Because of that layout, and our ability to offer different types of opportunities to the end retail investor, the investor has all the choice. They can look at whatever property they'd like. They can invest in multiple types of properties so they can diversify their portfolio. And we'll have data from some of the leading data providers to support them in making their decisions with third-party information, so they can be fully confident in what they're investing in.
Who pays for the platform? (8:24)
Adam Torres: And so who pays here? Is it like a normal brokerage, where maybe they're paying for the trade or paying for the access? Is it like a syndication? How do the fees work out?
Mor Milo: Wow, amazing question. Basically, the way this works is that we're delivering commission-free investing to retail investors. All they have to pay for is the cost of the transaction, like a wire transfer or an ACH, and usually that's a small number of basis points. We're talking about half a percent, three quarters of a percent, maybe a little more. Other than that, they have a commission-free investing opportunity.
The people paying for this solution are the developers who are looking to expand their footprint in the market they want to be in, by offering new opportunities to get funding for the next deal. The beauty of this for developers is that they have an opportunity to collect cash from investors who are looking for ways to create returns, and they don't necessarily have to take on debt on a piece of property to build it, renovate it and turn it into a profit. So the beauty of this whole thing is that we're supporting average consumers, everyday Joes, in investing as little as $100. And the way we're doing that is by helping small and medium-sized developers broaden their strategy and make more money, while building more real estate in this country to help solve one of the biggest problems we've faced in the last 10 years, which is the housing crisis.
How would Relli attract investors and developers? (9:56)
Adam Torres: Talk to me about your vision for how to expand this, because I guess there are two sides you have to attract. You have to attract the people who want to list their properties or developments, and you also have to attract the investors. Talk to me about your plans to roll this out and attract both parties.
Mor Milo: Absolutely. We have a platform we've built at relli.co, and our investors can go onto it, check out the available options to invest in, all different types of real estate, and manage all their investments in their dashboard. What we're doing is taking that dashboard and generating as much content around it as we can, so we can start posting on social media: value-based content, fun and engaging content. We actually have a mascot that's coming out very soon, so keep an eye out. We'll give you a little sneak peek: his name is Klaus, and he is a house. We're very excited. It's one of the coolest things I think we've been able to build. We're working with incredible people to put it together, and it'll be coming out very soon with lots of very cool GIFs and pieces of content all about Klaus. He's going to help guide people through the process of investing on our platform. He's going to be like your little assistant, showing you how to go from step A to step B. So Klaus is coming.
In addition to Klaus, we also have some Facebook groups we're building. We're trying to get as many real estate professionals together as we can, so we have as many professionals as possible who are capable of delivering great opportunities to these investors. We're generating an ecosystem with lots of different partners. As you may or may not know, real estate requires a lot of different vendors, and if you want to go into a new market, sometimes you need to find a new vendor. So we're going to bring all of these vendors, like architects, lawyers and accountants, into one place where they can build new relationships with developers looking to expand their footprint. Those are just a few ways to bring people onto our platform that will help us bring in more investors to fund the deals.
The nice thing is that this is a growing market. We're not the only ones out there. The crowdfunding real estate market is somewhere around $21 billion today, in 2023. By the end of 2036, it's projected to be somewhere in the $3 trillion range. So there's a huge opportunity here, and the name of the game is how we provide the best investment platform for these retail investors to learn how to invest and to have the most opportunities to diversify their portfolio. That's what we're doing on the platform side.
Now, on the developer side, there are a lot of excellent developers out there. They're raising money from investors, going to institutional capital, getting hard money loans, all sorts of things. What we want to do is give them a new avenue to maximize their business. Never before have these developers been able to build a brand for themselves, say on social media, get some followers, and turn those followers into investors in their business. Normally, to invest in a real estate property like this as a limited partner, you need to come up with a big sum of cash. You're talking $25,000, $50,000, $100,000. That's not attainable for most people. So we're going to give them the opportunity to open up that investment pool from the small percentage of accredited investors we have in this country to 330 million Americans who can now participate in these new offerings.
So we're not only offering them an opportunity to get more funding for more projects so they can expand their footprint in the marketplace. Because of the raising model we're using, it actually comes out more affordable for developers to build these projects. They usually see a significant return on investment with this strategy, because they can maximize the returns on the back end by paying less to hard money lenders, paying less in loan origination costs, and dealing with less paperwork. So it's a completely different strategy for these developers.
One of the biggest problems some of these SMB developers face is that they can't get money fast enough. They have the deals. They have a great system. They have a lot of opportunities in front of them, and they just can't get their hands on enough money quickly enough, whether it's because of their debt-to-income ratio, or because they don't have as big an accredited investor footprint as they should. So we're offering them a way to generate new opportunities with new investors, build more property, generate more revenue as developers, and build better relationships with their investors, because they'll be updated more consistently through an automated solution.
Why does investor education matter to Relli? (15:09)
Adam Torres: That makes total sense. I get what you're doing, and it's really genius. As I look at the platform, you mentioned content and content creation. Maybe go a little further into that, because I'm interested. What was his name? A house is a Klaus?
Mor Milo: Klaus is a house. Klaus the house.
Adam Torres: Klaus the house.
Mor Milo: Yes. Klaus is our mascot. He's coming out very soon. We're building him, making him beautiful and getting him ready for his grand release, so we're very excited for that.
From a content perspective, as I mentioned at the beginning, my mission and my team's mission is to help level the playing field for average Joes in America and in the world. How do we level the playing field? Knowledge is power. And most of this stuff just doesn't exist: the knowledge you need to do this type of investing. It's tribal knowledge. It's passed down from one developer to another, or from one lawyer to another, but it's not available in an open space in a way that's attainable and actually malleable, something people can take in and understand. It can start getting a little high level and a little out of reach.
So for us, it's really important to build out our Relli Academy. If you look at the drop-down at the top of our website, you'll see Relli Academy, and within it are the first 10 chapters of Relli Academy Real Estate Investing 101. It's really important for us to do the education piece for these retail investors, because our end goal is not only for them to invest with us, but hopefully to grow as investors in real estate with Relli, to the point where they can be a limited partner and put up $50,000 in an opportunity they choose. If we can teach them the basics up front, the things they need to know so they can grow as investors, then we did our job. It's a benefit that we made a couple of dollars. That's awesome. And we're helping average Joes build wealth through real estate, which is our number one goal.
So we're really excited about the content we're putting out. It's actually really funny: I stepped away from a content day. My entire team is hanging out in a podcast studio, building out all the content for the first 10 chapters of Relli Academy. So it's wonderful that you brought it up. We're really excited to put Klaus out into the world and have him guide people through the basics of how to invest on Relli, and to build out Relli Academy so people can learn the basics of real estate and where to go from there once they get started.
Where can people find Relli? (17:48)
Adam Torres: That's amazing. It's a great story, one I'm happy to bring to my audience. And Mor, you mentioned the website earlier, but I want to give it again, because somebody was probably in the car, driving, just getting to their office. I don't know where they're at, but they definitely didn't write it down. What's the website? How do people get involved?
Mor Milo: Check us out. We're on Instagram, we're on LinkedIn, we're on TikTok. You can check us out at our URL, relli.co. Relli is spelled R-E-L-L-I dot C-O, not com, C-O. Come join us on our URL, and then check us out on all of our social platforms. We're going to start posting a lot of content and really driving some of the educational pieces on TikTok, LinkedIn, YouTube Shorts and Instagram. We're really excited to deliver all that. You can find us at our handle, which is also relli.co, R-E-L-L-I dot C-O.
Adam Torres: Fantastic. For everybody listening, we'll put those links in the show notes so you can just click on the link and head right on over. And speaking of the audience, if this is your first time with Mission Matters, we're all about bringing on business owners, entrepreneurs and executives. This is a daily show. Each and every day, we're bringing you new entrepreneurs and new stories. If you haven't hit the subscribe button, this is your opportunity to hit it. More episodes are coming out shortly, and we definitely don't want you to miss a thing. Mor, it's been an absolute pleasure. I can't wait to watch the continued success of Relli and see where you take this thing. So thanks again for coming on the show.
Mor Milo: Thank you, Adam. I really appreciate the time.
Listen to the full episode
- YouTube (Mission Matters Money)
- YouTube (Mission Matters Podcast)
- Apple Podcasts (Mission Matters Money)
- Apple Podcasts (Mission Matters Business Podcast)
- Spotify (Mission Matters Money)
- Spotify (Mission Matters Business Podcast)
Mission Matters is hosted by Adam Torres. Learn more about how Relli works, review current offerings or read more from Mor Milo.
