However, I have to sign a PPM that tells me that this is a high risk venture and I may lose all my principal.

I am a newbie in Los Angeles and am eager to begin my venture into real estate investing.  

See about venturing into some other types of investing such as note buying. 

Either the profit is to marginal for big time flippers or small time flippers won't be able to make a profit.I think a tax would only be applicable if the flip generates over $100,000 in revenue.This gives the city their piece of the pie while allowing small independent flippers to continue their own ventures.

However, ideally everyone would feel they are being compensated fairly once you sign the joint venture agreement or formation docs. 

Additionally, he and both have relationships with Hedge fund money that is willing to lend on ventures as such.

I find his perspective to be very practical and it has encouraged me to look to invest in my first rental property out-of-state, but I need to find the right people to make my first RE venture a success.

@David Crumley...why not just buy a commercial asset with 30% leverage, 10-15 year note, 7-10% cap.  10-15 years from now you would have tripled your investment assuming zero inflation and you can focus on other ventures.  10-15 years later leverage against the property or 1031 exchange into a larger asset.  

I’ve been in real estate for over two years and now looking to get into the investing side. I’m looking to shadow an experienced investor or JV with another investor (even a newbie to put our heads together) in Housto...

You're a little strapped being in NYC because you won't get positive cash flow there on properties, but if you're willing to venture out a little then you can definitely get it and keep involvement to a minimum.