by Joe Firmin 2 Minute Read
So you’re getting a little more comfortable in your understanding of real estate syndications because you read Part 1, right? Of course you did… As a quick recap, we answered the following 4 questions:
- What is a real estate syndication?
- How does a real estate syndication work?
- Why should you invest in a syndication deal?
- What would an example real estate syndication look like?
Cool! So we’re done right? Um, not quite.
Most people want to go a little deeper and so I’ve got some additional questions that need answering, such as:
- Is a syndication a fund that I can invest in and True Freedom Capital would use the capital to invest across multiple deals/properties?
- What’s the minimum investment?
- How do I find out about the opportunities to invest?
- Once I send my money in for the deal, what happens next and how long will my money be stuck in the deal?
Hey! Great questions, let’s get to them!
IS A SYNDICATION A FUND OR A DEAL BY DEAL THING I INVEST IN?
The types of opportunities True Freedom Capital will bring, will be specific opportunity based, deal by deal. At this time we do not have the legal fund structure set up to accept funds for investment across multiple investment opportunities.
There do exist funds that do this, True Freedom Capital does not do this… yet. Our mission is to help as many people as possible to invest in cash-flowing real estate backed hard assets that generate long-term passive income. Our vehicle to do that is through the SEC Regulation 506(b) syndication model. Within this model, we can accept up to 35 non-accredited investors per opportunity we bring to our investors. While this model is more accepting, even non-accredited investors must be “sophisticated” enough to understand the risks and nuances of investing in these types of opportunities. Typically as well, the minimum investment for a 506(b) opportunity will be lower to be more inclusive.
WHAT IS THE MINIMUM INVESTMENT?
Good question, you’re on top of it.
Because we operate on a specific opportunity basis, the minimum investment will change by opportunity. It may be as low as $20,000 or as high as $50,000. This will depend on the amount of capital needed to close the deal and the number of investors allowed per the SEC.
If $500,000 is what is to be raised for the capital investment, and ONLY non-accredited investors subscribed to the offering, then that minimum would need to be $15,000 to ensure an adequate capital raise ($500K / 35).
This is why there needs to be a minimum and why (at this time) must say the minimum investment will be deal-dependent.
HOW DO I FIND OUT ABOUT THE SPECIFIC OPPORTUNITIES TO INVEST?
Glad you asked!
First, join our investor club – the Freedom Network. It’s free, no commitment (seriously). If you aren’t on that list and we don’t have a relationship, we can’t send you an opportunity (SEC rules).
Once you’re in that club, we’ll schedule a call with you to understand your goals and investing experience, get to know you (if we don’t already), and develop a relationship that is substantive.
We may, in our newsletter, discuss results of deals we’ve done in the past or show results, but by then, it will be too late to invest.
What are you waiting for? Sign up.
WHAT HAPPENS AFTER I SEND MY MONEY IN FOR A DEAL?
OK, so you’re all signed up and we have a great relationship! Sweet.
You’ve done your diligence on an opportunity we’ve brought to your attention. You’ve signed your private placement memorandum and sent in your money to be a part of the investment. Now what?
Well, distribution and communication – to put is bluntly.
You’ll receive ongoing communication. We wrote a whole post about it here, but I’ll recap in this spot.
Monthly or quarterly (depending on the deal), you’ll receive an update with financials showing the performance of the investment, progress of the business plan, challenges and additional opportunities we’re experiencing in the project. Because these investments are value-add, meaning we implement a list of action items to improve the value of the property, this process takes time. We’ll use the ongoing communications to inform you of the progress. This communication will be accompanied, by of course, your cash-flow distribution.
We only want to invest in cash-flowing assets that generate that passive income, so our goal is to purchase it cash-flowing and then improve that cash flow again and again.
Sounds good?
Great. Well, I’d be remiss if I didn’t remind you again…
If you decide you want to be a hands-off investor and invest in real estate syndications, join the Freedom Network. It’s absolutely free to join with no commitment necessary, seriously. If you don’t join, we won’t be able to send you opportunities (sorry, SEC rules). So join today! Not sure how it will work? Check out this post to understand the logistics. Or go back and read Part 1 & this post again. 😊