How do I find people for my real estate syndication?

Question

I was trying to find people around my area or out-of-state, but I don't know where to look for investors that'll invest in my deals. Currently, I need to raise 500k in 20 days, and I would have 100k from my partner. How do I raise the other half?

Chris Seveney · Answer

@Branden Yang

You cannot just go out and raise money from passive investors unless you want to have your state securities board knocking on your door.

You need a securities attorney and $20k to do a regulation D 506c or 506b offering. Your attorney will put a PPM, subscription docs and file proper forms. I would say it would take 2-3 months to do your first PPM as you will have a lot of back and forth with your attorney on how to structure it.

For more info google those terms as well as the howey test.

Also the first question an investor with that much $ is going to ask is what is your track record and provide them with the PPM and a summary of your financial model.

Taylor L. · Answer

Are you doing a 506b? If so, you're limited to folks with whom you already have an existing relationship. Have you made a list of prospects and do you know their accreditation and sophistication status?

For the future, the best thing to do is to dig the well before you're thirsty. Always be building investor relationships before you have an offering.

Paul Moore · Answer

Hi @Branden Yang! You got some great advice above. As @Taylor L. said, I recommend building a program and putting together a long term strategy, but I know that does not help you now. I would recommend going to REIA meet ups in your area and try to find someone to partner up with you. You will get a lot more traction face-to-face than you will online with such a short time frame, etc. I also recommend you check out @Whitney Sewell's podcast The Real Estate Syndication Show. Good luck and happy investing!

Taylor L. · Answer

Are you working with a securities attorney?

Brock Mogensen · Answer

Raising money is not easy.  Especially when you are still building your track record.  Friends and family is the easiest place to start.

Ronald Rohde · Answer

For that low of a raise, just do F&F joint venture. No one is passive, active partners each putting in $1-200k.

Al M. · Answer

@Taylor L. that’s great advice!

Jayson Cain · Answer

@Branden Yang If you're going the syndication route, you might need more than 20 days to get your PPM ready and everything else that comes with a syndication.

If you can't extend the close of escrow, you can also partner with a few people through Joint Ventures which can be easily set up.

How do I find people for my real estate syndication?

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