Raising capital for syndications

[Jordan Northrup]

I've heard multiple multifamily syndication sources say that if the deal is good enough, the money will find you. Thus, focus on finding a great deal and raising the millions of dollars you need will be easy. Does anyone have experience here? Do you find this to be true?

[Stuart Udis]

I am merely focused on the fact there are people out there teaching you (and others) that you can become a syndicator merely by finding a good deal. I expanded upon that with my own observations on how the same individuals who are teaching this are also teaching other bad business tactics and the reprecussions that will come from the way so many are being taught. The point I was hoping to get across is the lack of consideration that's placed on what happens when money is raised and property is purchased. Just because you can find a property and raise capital does not mean you should take that next step and actually purchase the real estate.

Keep in mind, if you are talking about raising millions of dollars, you are no longer reliant on friends and family money. If this hypothetical person you desrcibe possesses the operational skills and the investment opportunity is good,  there are plenty of equity placement services out there who will find the needed equity check. There are plenty of sponsors who operate in that space who will be the first to  acknowledge  they are not good capital raisers or maybe they merely want to focus their attention on other areas of  the business and rely on service providers such as the one I am describing.  

The same ndividuals who are teaching you and others to find a deal and the money will come are not teaching you to find a sophisticated check writer. They are instead teaching you to find a bunch of less sophisticated capital sources because the sophisticated equity will see through the charade. This is what I find most troubling and what more should be weary of who decide to invest in syndications. Unfortunately its getting harder and harder for anyone intersted in investing as an LP to vet the the sponsor groups as the tactics used to raise capital along with reprenstations made are increasingly falling in the grey area. I attribute much of this to the way so many are being taught.