Bringing in Outside Capital: Advice on Structuring, Syndicating, JV, and PML

[Logan Koch]

As I've been doing more and more deals over the years, and gaining more and more experience I been having people reach out about how they can invest with me on future deals whether it be Buy & Hold or Flipping. I've just  been brushed it off for a while as I continued to build a portfolio on own, and wanted to continue to gain more experience before going down that road and the large responsibility that comes with bringing in other peoples money into the investments. 

At this point I'm realizing can scale a lot faster with those partnerships, and beginning to try and understand the actual structure of the business behind these kinds of partnerships. I realize I'll need to consult with my attorney and CPA for actually structuring these, but I'm interested to learn from anyone here who's scaled their real estate business from their individual portfolio or flipping business, to bringing in outside capital to grow. 

As a hypothetical example lets say, I'm able bring in 10 investors who want to invest $25k each. The majority will most likely want an equity position in the deal, and since wouldn't have an active role I'd be getting into a syndication rather than just a JV. A few may just want to be a PML and get the agreed upon interest rate. If we're focusing on Small Multi-Fam and/or Flipping. Would pool this "fund" of capital along with my own to be able to do multiple deals at a time. Just trying to get a better idea on how it really looks from people who've done it.

From my basic understanding that I'm brainstorming this, would need to set up a new LLC for the Syndication That would own properties bought using the combined capital from the equity partners and myself. My personal holding company would own the equity position for my percentage in this syndication. The investors who prefer to lend privately rather than hold equity positions would receive promissory note tied to an individual property that their contribution is tied to? I know there's a lot more detail that goes into this, as I'm trying to set this up

Would appreciate insight from anyone out there who's done it, and willing to share from experience.