House flipping - debt or equity financing?

[Justin Gottuso]

So... I have access to a steady stream of profitable house flip opportunities, as well as local contractors and labor that is fairly priced. I’m thinking about raising private capital to acquire and rehab these properties quickly, reinvesting the profits and eventually putting thr profits into larger multi family complexes. Ideally the investors would invest in the “debt fund“ for an agreed upon interest return, like 10-12%, providing me flexibility to function as the general partner who can acquire multiple properties without the liability of joint ownership issues like if I had equity investors. For example, I’ve had two great deals come my way the last two weeks with 20 to 30% cash on cash return, but by the time I have pitched the property to equity investor and gone back-and-forth, the deal is gone. The debt investors are hands off and get regular checks. I continue to reinvest their money and earn good returns for myself. Thoughts? Feedback? Thanks so much!