For an industry that is still in its infancy stage real estate crowdfunding platforms have proved that they can attract a lot of attention and millions of dollars in capital. The key test the industry now faces is whether or not it can deliver a payday to investors.

The real estate crowdfunding sector is experiencing explosive growth. Since 2013, the amount of capital raised by global real estate crowdfunding platforms has more than tripled, growing from $396.4 to $1.014 billion in 2014, according to Massolution, a Los Angeles-based crowdfunding research and advisory firm. The company also forecast that real estate crowdfunding platforms would raise $2.5 billion in new capital globally in 2015.

In order to keep its momentum going, the industry does need to show that it can deliver on targeted returns. In that regard, it is important to note that it is the sponsor—the developer or investment group—that is in the hot seat, as with any private real estate offering. However, crowdfunding platforms do run the risk of losing credibility if a deal goes south or returns are far less than projected.

In terms of quantifiable results, a track record on just how posted offerings are performing has been slow to materialize as it is still early days for the industry. Most crowdfunding firms have only been in business for two to three years, and less than 4 percent of capital invested had been returned to investors, according to a Massolution real estate report that was published in early 2015.

Although the Jumpstart Our Business Startups (JOBS) Act was signed in April 2012, it was Title II rules that went into effect in Sept. 2013 that opened up real estate crowdfunding by allowing for general solicitation of Regulation D or unregistered offerings to accredited investors.

Some of the early results are related to crowdfunding deals that are shorter term, such as construction loans or fix and flip situations where a sponsor is looking for short-term financing of one to three years versus a long-term hold of 10 to 20 years. That performance info has been largely anecdotal.

“One of the nice things about being this online, transparent portal is that we can be very open about what we’re doing and put everything online for our investors to see,” says Jason Fritton, CEO at Patch of Land, a real estate crowdfunding platform that specializes in providing real estate lending.

Patch of Land posts loan offerings that are priced from 8 to 12 percent, with a blended annual return at 11.8 percent that is paid out to investors monthly—and no losses to date, says Fritton. The company has hosted “a few hundred” offerings on its site since it launched in October 2013. Deals are generally short-term, interest-only bridge loans that typically range in size between $500,000 and $1 million. The loan terms run 12 to 18 months, but on average, have been paying off in nine, says Fritton.

CrowdStreet is another crowdfunding platform that specializes in institutional quality commercial and multifamily investment property offerings that are available to accredited investors. Since launching in April 2014, CrowdStreet has posted 32 private real estate offerings and funded $26.3 million on its marketplace. The average target investor IRR is 17.8 percent and average investor preferred return is 8.4 percent.

For example, CrowdStreet’s first offering was for Mainstreet Bloomington, a seniors housing development located in Bloomington, Ind. The deal went full cycle in August 2015. It delivered a 10 percent annualized current yield to investors that was paid quarterly, with an additional 4 percent annualized accrued return paid at redemption.

“That return was exactly in line with Mainstreet’s original pro forma,” says Darren Powderly, co-founder and vice president of business development at CrowdStreet Inc. in Portland.

Overall, the early results coming in from platforms such as Fundrise and Realty Mogul and others have been very positive, says Anthony Zeoli, a partner in the corporate practice group at Freeborn & Peters LLP in Chicago. “I haven’t seen any deal that has been completely a bust or angered investors to the point of fraud or anything like that,” he says.

Yet there have been projects that have not come up with the exact target return. Sponsors might be predicting more favorable returns, such as 13 to 18 percent, when they actually only deliver 7 to 12 percent. However, on a relatively short term investment of 12 to 18 months, that is still a decent return, says Zeoli.

Another big hurdle for crowdfunding firms is a growing bifurcation in the market between the strong and weak platforms. Some are proving that they can raise capital and operate a sustainable business model, while others are struggling.

For example, investment bank CapStack Partners is suing the crowdfunding firm iFunding over two real estate financing deals the firms partnered on last year. According to an article published in January by The Real Deal, the suit alleges that iFunding failed to raise the amount of capital through its platform that it had agreed to and then repeatedly lied about its performance. Although iFunding denies any wrongdoing, the lawsuit highlights the added challenge that crowdfunding firms will face in proving their business model to investors, sponsors and other stakeholders going forward.