Certainly from a capital raise perspective, $5 -10 million is a reasonable amount.That being said, raising capital for a blind pool fund is much more difficult than raising capital for a syndication where the property is already identified and the potential investors know exactly where there money is being invested.

ya Open door capital struggles are well documented..

Local references are invaluable because those lenders have proven themselves in your market.Work with Reputable Companies: Some well-known DSCR lenders with a solid reputation include Lima One Capital, LendingOne, Kiavi, RCN Capital, Visio Lending, and Easy Street Capital.

Truthfully horrified that this is an individual who wants to raise capital from others "to scale" after owning section 8 rentals for 2 years.

Many of these lenders allowing 2nds behind them are more expensive capital (10's - 13's in our current market [high rates - but now showing signs of coming down]).

Looks to me like Fund 3 is a new fund that they are raising capital for.

Are you located in the Capital Region?  

I'd work on a strategy that returns my capital guaranteed. build to rent direct with ground up developer does this.

Also the opportunity cost of not deploying your capital in an investment vehicle yielding more than 7% is high. 

The benefit to these is you get your foot into the door without a ton of capital and as time goes you can move out and cashflow on the property.