The Prodigy Network is a New York–based development firm that raises capital for projects through crowdfunding campaigns. It is similar to Kickstarter, but on a much larger scale. Prodigy was founded in 2003 and has most famously raised funds for a 66-story tower in Bogota, Colombia. Now, the developer is at work converting an existing Manhattan building into an extended-stay hotel. The project, known as 17John Street, is not only crowdfunded, its interior design is crowdsourced as well. Winka Dubbeldam of Archi-tectonics is designing the rooftop addition. In early September, Prodigy Network announced that it closed on 17John Street, buying the property for $85.3 million—$25 million of which was crowdfunded.
AN asked Prodigy’s CEO, Rodrigo Nino, about his company’s work and what crowdsourced development means for the future of architecture.
You have been doing crowdfunded projects in South America, so what now brings you to the New York City market?
I have been doing business in the States for a long time. I was born in Colombia, but I consider myself a New Yorker. I have been here with my family for seven years now and have been doing residential real estate for a long time too. I have a large operation in Colombia—we are on our third project and we are doing ground-up development over there. While here in New York, we are doing acquisitions and are on our third project now.
How does crowdsourced design factor into crowdfunded development?
Crowdsourcing development is essentially a bottom-up approach to urbanism. You have a lead architect, you have a developer, and you have curator, you could say, and you finalize what the project could be, and then you ask the crowd. You create an online competition to validate whether your hypothesis was right or wrong—chances are, the collective intelligence of the crowd is always going to be greater than any of its individuals.
How have the SEC’s new rules—included in the JOBS Act—which allow private companies to advertise investment opportunities without registering them with the Commission, changed things for the Prodigy Network?
The JOBS Act changed everything on September 23, 2013, because it enabled open solicitation to accredited investors. In terms of architecture, it brings a new tool to architects that can effectuate projects that they have in their minds, but that nobody wanted to finance before now. Every architect has a dream project that has never been done; now they have a more accessible source of capital, provided they are able to inspire the crowd. And they can fund it without the participation of a full-blown developer.
Are these projects truly crowdfunded if people need thousands of dollars to get involved? Are there ways to get lower-dollar investors involved?
Yes, right now I essentially have tickets in Colombia going for $20,000 a pop, and I am thinking of reducing the ticket even further to $10,000 a piece. It is far from ideal because, obviously, you wish you could invest $100 in a project, but we are not there yet.
What does Prodigy Network have planned next?
We are bringing our platform to third-party developers and we are working on the launch of an actual website. Right now we are vertically integrated. We only fund our own projects, and that is changing in September.