The idea of becoming a real estate investor for as little as $5 may seem too good to be true.

And for many users of Landa, a proptech company that promised just that — it has been.

Landa emerged from stealth in August 2022, announcing a total of $33 million in funding and a pledge to help everyday Americans access residential real estate investment through fractional shares.

CEO Yishai Cohen and former CTO Amit Assaraf founded Landa in 2019 in an effort to make real estate investment more inclusive. The app’s only requirements were that users be over age 18 and U.S. residents. They could start investing with just $5, and buy and sell shares as well as see real-time updates on their properties from the Landa app. (Assaraf left the company in December of 2023, according to his LinkedIn profile. He has not responded to requests for comment.)

Today, Landa’s investment portal site is down and its app is inoperable. Users claim they can’t access their funds and haven’t been paid dividends in months. The startup is embroiled in litigation, including a lawsuit from its early venture investor Viola.

One early user told TechCrunch that Landa stopped paying dividends to him on his shares in January. When he asked Landa about it, they “punted the question,” he said.

“I repeatedly emailed them about it and just got deflecting answers, nothing real,” the user said. “Then a few months after that, the app became unusable. It would not open.”

The user then asked if he could delete his account, which he had opened in 2021, and sell the shares. But he found Landa had disabled his ability to sell shares.

“They have essentially frozen me out of my funds and just shut down the app,” the user said. “Where is the money? Why won’t they return it to me?”

Over 130 complaints have been filed against Landa to the Better Business Bureau, with dozens of people echoing similar allegations. For instance, on May 1, one user who filed such a complaint shared they had invested over $8,000 through Landa and stopped receiving dividends last fall. The user said Landa customer service replied to their emails by saying that the company is “working on it.” 

In mid-April, when TechCrunch asked Landa about the issue — including the status of its downed site and whether the company itself had shut down — CEO Cohen said:  “Of course not. The site will be back up.”

When asked why the app was not working and why users had not received dividends in months, Cohen’s terse reply still seemed to refer to the website, blaming the servers: “It’s unrelated to dividends. It’s from our servers. We are on it.”

Upon further prodding, Cohen on April 18 shared the following statement: “We are aware of the issues currently affecting our platform and product, and want to assure all investors that we are actively working to restore full functionality as soon as possible. We have kept investors informed through all updates, including the server access issue. We appreciate the continued support of our investors and resident community, and remain committed to delivering on our vision of making real estate investing accessible to everyone.”

Cohen did not respond to our request for a status update on May 20. Investors NFX and 83North did not respond to our multiple requests for comment. 

Embroiled in a lawsuit 

It’s not just users who are upset with Landa. The company’s primary lenders are suing. 

Viola Credit and L Finance filed a lawsuit in New York State Supreme Court against Landa in November 2024, accusing it of “numerous defaults” on more than $35 million worth of loans they extended to the company. (Viola is also an investor in Landa through its venture division.)

The lenders also accused it of missing property tax payments that led to the forced sale of those properties, neglecting properties, and even failing to collect rents.

The lawsuit — first reported by real estate industry publication Bisnow — states that after over a year of attempting to get Landa to honor their commitments, the lenders removed Landa as manager of the homes and appointed an independent property manager and a chief restructuring officer. 

After further negotiations failed, the creditors later asked the court for, and were granted, an injunction blocking Landa from accessing bank accounts, interfering with their attempts to restructure the business, and reclaiming money they say is owed — including proceeds from property sales.

Despite the injunction, the lenders returned to court in January 2025, claiming Landa told tenants to send rent payments to a different bank account not covered by the ruling. They discovered this while making repairs to one property’s septic system. They also accused Landa’s CEO of trying to sell or refinance some properties.

The court ordered Landa to explain itself. Instead, in early March, Landa asked the court for a restraining order against Viola Credit and L Finance, claiming the independent manager was “installed unlawfully.” 

Judge Jennifer G. Schecter was not pleased. In March, she ordered both sides to find a solution “that’s good for all of your clients.” She denied Landa’s request for an injunction and ordered the company to pay nearly $100,000. A few weeks later, Landa filed a formal countersuit. The case is still pending.

Challenging model

Landa is just one of several startups that emerged in recent years offering fractional real estate investing. It is also apparently not the only one that has struggled — especially after mortgage interest rates began soaring in 2022. 

Fintor raised millions of dollars before seemingly pivoting to offer an “AI Agent to automate finance and real estate operations with human level performance.” Dallas-based Nada, which offered index-like real estate investment products called “Cityfunds,” allowing non-accredited investors to buy into a city’s home equity market with as little as $250, also appears to have pivoted. Its website now promotes a new tagline: “Access home equity to finance anything.” 

Arrived was perhaps the highest-profile of the bunch — and the only one that seems to be actively operating under the same model. In May of 2022, TechCrunch reported that Arrived raised $25 million in a Series A funding round including Bezos Expeditions, to allow people to buy shares in single-family rentals with “as little as $100.” According to its website, the startup has to date paid out over $13 million in dividends and interest and has 766,000 registered investors.

As for those people who invested with Landa, the future of their money appears uncertain. As of May 23, Landa’s investor portal website still redirects to a “come-back-soon” maintenance message.