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6 Highly Common Reasons Real Estate Syndicators Fail

Why do so many real estate deal sponsors fail — while others seem to effortlessly raise and close deals? Not Structuring Deals Correctly There are many ways to structure syndicated or crowdfunded real estate deals and partnerships. Just make sure it is structured well, competitively, and in an appealing way that your target investors will understand. Real Estate Syndication Software Today sponsors can choose to try to raise money manually offline, leverage existing third party real estate crowdfunding portals (if you qualify and can stomach their fees), or launch their own portals online with white label syndication software. And make sure you’ve budgeted for their legal fees, which may be substantially more than your expect, depending on how you will file with the SEC. Not Offering Enough Deals Investors can get impatient. Yet, having a consistent deal flow and well-rounded menu of opportunities can make all the difference in making it and surviving as a sponsor. Not Raising Enough Money Having too much money can seem like its own crisis sometimes. These costs can range from legal work, research, and marketing to staffing, servicing investor clients, payment processing fees, accounting, property renovations, and more. The last thing you want after you’ve done all the work and raised the money is to realize those costs mean that you can’t deliver on your promise.