$160M of slums in Detroit
Since Covid, the phrase “real economy” has become fashionable. People use it to talk about the bullshit around reindustrialisation that nobody wants to fund, or the corner shops everyone wants to protect but nobody wants to pay the real price for. Behind this tired marketing fad hides a vague opposition to finance that nobody can really define.
Big bad finance. The very thing François Hollande, the former French president, once named as his true adversary. Brrr.
And yet behind bonds issued on the markets, or subprime loans sold on, lies the funding of real companies where real people work, and the mortgages of real houses. Financialisation turns walls into paper, then paper into bytes. At every step, we drift a little further from bricks and mortar. At every step, we add a layer of abstraction that makes us forget that at the end of the chain, there are people living in these houses.
In Detroit, you can now buy, for $50, a token representing a fraction of a slum you will never visit. I should know: I bought one.
RealT, the startup that sold me that token, has raised $160M since 2019. It owns 2,000 homes in Detroit’s poorest neighbourhoods. Its founders talk about democratising real estate.
But behind the technical jargon and the financial spreadsheets lie the homes of real people.
And that is today’s story.