Questionnaire for Syndicate Investors
If you were interviewing investors for your syndication deal, what would your top questions be to ensure they are a good fit? if you would consider unaccredited, sophisticated investors, what would be your top questions for them?
Most Popular Reply
@Adam Lendi, this is a great post, and I hope many syndicators respond. Here is an abbreviated version of what I like to cover:
1. Liquidity Continuum (real estate illiquid vs. stocks very liquid). Clear?
2. Can’t get sell your shares like stocks, etc. Clear?
3. You could lose all your $. Clear?
4. Tax laws could be downgraded.
5. IRA... you may have UBIT? Clear?
6. Married... Spouse onboard?
7. Can’t 1031 out of this at the end. Clear?
8. Do your moral compass and values align with ours?
9. We want to be sure the investor doesn't use gambling language. This is a serious long-term investment, not a wager.
10. Do you really understand the preferred return (it's actually a hurdle rate!)?
11. You understand the returns are not guaranteed at all... just projections?
You may want to check out Brian Burke's book on syndication as well. Good luck!