mogul is known as a blockchain-based platform that enables anyone to directly invest in cash-flowing properties for as little as $100 and property owners are provided with cost-cutting and equity-unlocking blockchain-based solutions and connects them to investors. To learn more about the company, Pulse 2.0 interviewed mogul co-founder and CEO Alex Blackwood.
Alex Blackwood’s Background
At the start of Alex Blackwood’s career, he worked in Goldman Sachs’ Real Estate Investing group as well as the company’s Investment Banking Division, advising blockchain-focused financial institutions and fintech players across the New York and San Francisco offices. Before joining the workforce, Blackwood graduated from Georgetown’s McDonough School of Business where he was a recruited student-athlete on the men’s heavyweight varsity rowing team.
Formation Of mogul
How did the idea for mogul come together? “mogul is the result of my own personal experiences as a real estate investor. In the early years of my career, I set out to purchase a property in Dallas, TX, to utilize as a cash flow property. As a part of that process, I put in over 180 hours of coursework, in addition to my investment banking hours, in order to attain my real estate license,” said Blackwood. “The more I learned through my coursework and the experience of buying the home, the more I realized how manual and archaic the process was. I utilized my ‘garden leave’ (a month off in between Investment Banking and Real Estate PE) to theorize how one of my passions — blockchain — might be able to fix the industry and put the idea to work. As part of my past, I knew I operated better as part of a team than I did in a vacuum. When I met my co-founder Joey Gumataotao, I knew he was the missing piece. The two of us met up to hash out details, and after eight hours in a hot Dallas diner, we had a plan in place to start mogul.”
Challenges Faced Building The Company
What were some of the challenges Blackwood faced in building the company? One of the main questions Blackwood asked himself before starting mogul was: “if you want to disrupt real estate, the largest asset class in the world, where do you start?”
“I turned to Amazon as an excellent case study for building an online marketplace. Amazon started with books as the easiest, most efficient way to build their offering. Cheap to ship, same-sized boxes, and inventory that could be held in a garage – books served as a way to scale into additional offerings. For real estate, the investing platform is the perfect allegory of books. You can scale up your portfolio on a platform in a capital-efficient manner by partnering investor funds with property owner inventory. Once at scale, you deploy additional products up and down the real estate supply chain leveraging your portfolio. Another challenge to face when starting out was dispelling suspicion around blockchain,” Blackwood acknowledged. “When your average person thinks of blockchain, they think of crypto. The crypto industry has come under intense scrutiny in light of recent bad actors. As a result, blockchain has unfairly garnered a reputation from black swan events in the crypto space. However, one of the core tenets of blockchain is trustless transparency. In an asset class traditionally hidden behind paywalls, industry jargon, and insurmountable barriers-to-entry, blockchain’s trustless transparency can demystify an asset class for every type of investor.”
Core Products
mogul offers all individuals the ability to invest directly in cash-flowing residential real estate vetted by industry professionals. Along with investment opportunities, mogul offers educational material for those looking to understand the world’s largest asset class: real estate.
Funding
mogul has raised a pre-seed round of funding from several prolific investors and industry veterans.
“We pride ourselves that our investors believe in the power of democratizing real estate investments and the ability to secure those investments through blockchain. Investors include Tim Draper (Draper Associates and early investor in Skype, Baidu, Tesla, Robinhood) and Rosa Rios (43rd Treasurer of the United States), among others,” Blackwood noted.
Total Addressable Market
What is the total addressable market (TAM) size that mogul is pursuing? mogul’s TAM is a large and growing population. And the core audience for its products is individuals in the financial industry and consultants in the 25-35-year-old range, in cities with high BTE real estate investing (NYC, LA, SF, etc.).
“When Uber first started out, they used the taxicab industry to calculate their TAM of $3.5 billion. They used the wrong proxy and grossly miscalculated, it was really many multiples of that. They should have calculated off the yet-to-be-formed ride-sharing industry (less than $80 billion in 2021, expected to rise to greater than $150 billion in 2026), but how on earth could they have, they hadn’t invented it yet,” Blackwood explained. “In creating a new form of ownership, you could theoretically say our TAM is $43 trillion (the US Residential market) or $3.5 trillion (the SFR market, of which only 2% is held institutionally). Our goal mentioned below is to onboard real estate to web3. In doing so, the potential TAM is in the trillions.”
Differentiation From The Competition
What differentiates mogul from its competition? At mogul, the company passes all of the benefits of property ownership directly on to users such as appreciation, cash flow, and tax benefits. And mogul is powered by industry experts and each property is fully vetted prior to being added to the mogul platform.
“Our results make it clear: the first property added to the mogul platform was presented to investors with a sub-three percent APR mortgage, in an interest rate environment that routinely surpasses rates of eight percent. mogul also boasts the lowest BTE of any real estate investing platform. Unlike competitors, we do not charge an asset management fee,” Blackwood pointed out. “We only collect a 3% platform fee and property management fee of up to 2.5% of the rental revenue. mogul also has cornerstone partnerships and integrations with fintech and proptech leaders MoonPay (providing debit, credit, ACH, Apple Pay and Google Pay payment rails for mogul users), as well as Awning.com (providing unparalleled property-level data analytics) and GloblRED (providing brokerage services and special syndication offerings to their clientele and mogul investors).”
Future Company Goals
What are some of mogul’s future company goals? “We are planning to strategically unveil several new high-growth properties on the mogul platform throughout the year to continue providing top-tier investment opportunities to users on the platform. Before the 2008 Bitcoin White paper, the 1998 Nick Szabo theorized about blockchain through conveying property titles over lines of code on the internet. Fast forward to 2023, real estate on-chain remains a new frontier. Our company’s goal is simple: onboard real estate to web3,” Blackwood concluded.