Syndication: What comes first?

[Mike Lowery]

Hello BP!

I’ve been working towards starting my syndication business from scratch. I have a developer working on a website and have generated interest with potential investors through communication with friends, co-workers and family. I have analyzed several deals and have some good potential leads.

The question I have is this: What should I focus on first? Commitment from investors without deals in hand, or deals that I could make work, find my niche and then prospect for investors?

I feel like this is a ‘chicken/egg’ scenario of what comes first as there is logic behind both.

Thanks in advance!

[Justin Moy]

You really have to find a way to do both at the same time. When it comes to finding money you can either start looking for your own investors or start networking with other operators / capital raisers. 

Lots of people say if you find a good deal the money will come, but even if the deal is great and you are looking to partner with someone there are capital raisers who won't love partnering on someones first deal if they've never met them before, so I'd start networking now. 

If you don't feel you have a strong sphere of investors who are actually willing to invest with you, maybe prioritize finding capital partners in the short term