Willow Wealth the private markets investment startup formerly known as Yieldstreet is confronting deepening financial trouble even as it attempts to overhaul its public image with a new name, website, and corporate mascot.
The company recently notified investors of fresh defaults on real estate projects in Houston and Nashville, Tennessee, adding roughly $41 million in new losses, according to letters obtained and verified by CNBC. These setbacks follow $89 million in marine-loan losses disclosed in September and an additional $78 million previously reported. In total, investors have now absorbed at least $208 million in losses tied to Willow Wealth offerings.
The rebrand comes as the company removes a decade of historical performance data from public view including a chart that showed real estate returns plunging from +9.4% in 2023 to –2% between 2015 and 2025 before disappearing from its website entirely.
“Yieldstreet’s old name had negative value,” said Mark Williams, a Boston University professor. “They removed performance stats to make it harder to uncover poor results. That should raise alarms.”
A Rebrand Amid Rising Losses
Yieldstreet, founded in 2015 and backed by prominent venture firms, built its brand on the promise of “democratizing” access to private investments the types of deals usually reserved for institutions and ultra-wealthy families. But the unraveling of its real estate funds shows the risks lurking in private markets, which lack the standardized disclosures of public investments and offer limited liquidity.
The firm’s pivot to “Willow Wealth,” complete with a new mascot named Hampton Dumpty (a Humpty-Dumpty–inspired character), signals an attempt to move past years of troubled deals. The mascot assures viewers he has “learned a thing or two about crashes” and now diversifies with private markets.
Despite the rebrand, the core pitch remains the same: private markets deliver better long-term performance than traditional portfolios. But critics point out that the company does not include fees which can reach 3.3% to 6.7% annually in its advertised charts.
Defaults Spread Across the Portfolio
Nine of the 30 real estate deals reviewed by CNBC since August a staggering 30% default rate have now collapsed. Typical default rates in private markets are estimated around 2% to 8%, according to industry experts.
The latest losses include:
Stacks on Main, Nashville (268-unit apartment complex)
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Investors contributed $18.2 million, plus an additional $2 million to stabilize the deal.
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Willow Wealth informed customers that their entire equity investment is expected to be wiped out, with member-loan investors losing up to 60%.
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The project was originally sponsored by Nazare Capital, tied to former WeWork CEO Adam Neumann’s family office.
2010 West End Ave, Nashville
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Another Nazare-linked project, previously reported by CNBC, cost investors $35 million.
Houston Multi-Family Equity Fund
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A suburban-Multifamily portfolio that lost all $21 million invested after the properties failed to meet revenue targets and fell into foreclosure.
Portland, Oregon Multifamily Project
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An $11.6 million investor loan is now in default after appraisals revealed the property value fell below the loan amount.
Future Trouble Expected
Willow Wealth has warned investors that deals involving:
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a Tucson, Arizona apartment complex, and
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two single-family rental portfolios across Southern states
are on track for significant, though unspecified, losses. Over $63 million was invested in these projects alone.
Regulatory Tailwinds and the Push Into Retail
Private-market investments gained a boost this year after President Donald Trump signed an executive order allowing them in retirement plans. Asset managers such as BlackRock, Apollo, and Goldman Sachs have moved aggressively to tap this new pool of retail capital.
Willow Wealth’s CEO Mitch Caplan, a former E-Trade chief, says the firm is shifting toward a hybrid model: offering deals not just sourced internally but also from Wall Street firms like Goldman Sachs and Carlyle.
The company says it removed performance data because it is transitioning toward third-party funds.
Still, customers dealing with long-delayed updates and accumulating losses view the rebrand as an escape hatch.
“A High-Risk Trap for Investors”
Williams, the Boston University professor and former Federal Reserve examiner, said he now teaches a course that includes Willow Wealth as a cautionary example.