Yieldstreet customer Justin Klish, who said he faces $400,000 in losses from investing on the platform.
When Justin Klish stumbled upon an ad for Yieldstreet in February 2022, he said, it was the company's tagline that stuck in his head.
"Invest like the 1%," the startup said.
The ad spoke to his desire to build wealth and diversify away from stocks, which were then in freefall, Klish said. Yieldstreet says it gives retail investors such as Klish access to the types of deals that were previously only the domain of Wall Street firms or the ultrarich.
So Klish, a 46-year-old financial services worker living in Miami, logged on to Yieldstreet's platform, where a pair of offerings jumped out to him.
He invested $400,000 in two real estate projects: A luxury apartment building in downtown Nashville overseen by former WeWork CEO Adam Neumann's family office, and a three-building renovation in the Chelsea neighborhood of New York. Each project had targeted annual returns of around 20%.
Three years later, Klish said he has little hope of ever seeing his money again. Yieldstreet declared the Nashville project a total loss in May, according to an investor letter, wiping out $300,000 of his funds. The Chelsea deal needs to raise fresh capital to avoid a similar fate, according to another letter. Both letters were reviewed by CNBC.
"There isn't a day that goes by without me saying, 'I can't believe what happened,'" Klish told CNBC. "I lost $400,000 in Yieldstreet. I consider myself moderately financially savvy, and I got duped by this company. I just worry that it's going to keep happening to others."