Starting a Syndication at 21 (NEED ADVICE)

[Lorenzo L.]

Hello all,

I'm looking to buy medium to large-scale value-add multifamily using OPM. 

I am wondering if my first steps (past the education part) is to build a network of people who know, like, and trust me through posting content like newsletters, articles, podcasts, doing webinars, going to events (aka build my brand), or, should I first find a deal and then raise capital?

The reason why I ask is because I'm sure some people are going to say it is critical to first build a network but I find myself doubting myself because why would someone listen to advice from a 21 year old who has never bought a deal before? Also, I am connected with a lot of sophisticated investors on Linkedin and I don't want to lose their respect because I am starting to post educational content when I have never done any transactions.

What do you guys think? Am I overthinking?

[Stuart Udis]

@Lorenzo L.  Why would someone listen to advice from a 21 year old who has never bought a deal before?  They shouldn't !!!  Appearing on podcasts, posting content and doing webinars won't qualify you either. Why is there this sudden pressure to syndicate. You are 21, there is no rush. 

 What ever happened getting a job, perhaps even real estate related if that is an interest or passion. By your own admission you are not interested in sourcing acquisitions or capital raising, so get a job working as a property manager or in  operations for a real estate company. Learn the business (and by that I do not mean assist  diligence on another GP's deal for free and get awarded "CO-GP status" to run with). Seek out a W2 position  working in the industry. Save up some money, buy your first few properties organically and once there's experience and the start of a balance sheet go out and raise money from friends and family if you are still interested in the business. Do right by them and word spreads, momentum is built and eventually you are raising money from PE firms, family offices etc. if you care to grow beyond your personal network's means. That's how this business used to operate for those who cared to scale beyond a passive endeavor. 

Now syndications have become a team sport intended to mislead. If duties were merely split between operations, capital raising and deal sourcing based on individuals strength and to spread responsibilities, I would be more understanding but that's not the new age model. Now a 21 year who have never owned real estate is being told jumping into syndicating is a good idea. As Charles even noted, If you do a good job with building sponsor relationships, then you can probably get to the point that they'll allow you to use their track record. This goes a long way when you're trying to find deals or to attract capital because nobody really wants to be anybody's "first" in this business.  If you have to embellish your credentials to raise money and are actively being taught this is how to syndicate, this should be called out. 

Raising capital, appearing on podcasts, creating misleading social media content &  finding deals are now used as tools to create credentials out of thin air. Anyone interested in being an LP in syndications should familiarize themselves with forum threads like this so they can ask the appropriate questions before making investments.  I am not part of the PassivePockets community but I hope members are being taught to watch out for these practices.