Want to start your own private fund or real estate syndication? Here are the first steps you need to take.
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Learn how to launch your own private fund or real estate syndication with Fund Playbook. In each episode, Jimmy Atkinson shares insights on syndicating deals, raising capital, and entrepreneurship.
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Episode Transcript Summary
Starting a private fund or real estate syndication is a dream for many entrepreneurs, but the process can feel overwhelming. Many first-time fund managers get stuck at the beginning, unsure of what steps to take. In this episode of Fund Playbook, Jimmy Atkinson and Andy Hagans provide a structured roadmap with small, actionable steps to help prospective fund managers gain momentum without feeling overwhelmed.
Prerequisite: Define Your Asset Class or Investment Strategy
Before diving into the first steps, Atkinson and Hagans stress a critical prerequisite: know your asset class and strategy. A fund or syndication is a way to scale an investment strategy using other people’s money (OPM). But without a clear strategy, there’s nothing to scale.
- What is your expertise?
- What is your unique investment strategy or “mousetrap”?
- Why should investors trust you with their capital?
Raising money comes with a fiduciary responsibility—this is other people’s savings, retirement funds, and college savings. Without strong expertise in an asset class or a deal in hand, launching a fund is premature.
Once this prerequisite is in place, three concrete, achievable steps can move fund managers forward.
Step 1: Write Down Your Fund or Investment Thesis
After identifying an asset class and strategy, the next step is to put pen to paper and create an executive summary.
What Should Be Included?
- A one-page executive summary (not a full business plan, pitch deck, or PPM).
- A clear description of what your fund will do, in a single sentence, paragraph, or up to a page.
- Specificity: What asset type? What location? What strategy? Example:
“We will acquire five multifamily properties in Fort Worth, Texas, perform value-add work, and hold them for a minimum of three years.”
Having a concise summary forces clarity and helps in conversations with potential partners, investors, brokers, and attorneys.
Why Does This Matter?
- It refines your vision.
- It builds confidence when discussing your fund with others.
- It serves as a reference document when pitching your deal.
As Andy Hagans points out, the more specific you are, the more credibility and trust you gain. A vague or generic investment thesis signals uncertainty, whereas specificity gives others confidence in your ability to execute.
Step 2: Assemble a Team
No one launches a private fund alone. It’s a multidisciplinary endeavor. The size of your team and the members of your team depend on the scope of your fund. But here are some common team members:
- Securities Attorney – Handles legal structure, SEC filings, and compliance.
- Fund Accountant – Manages fund finances and investor reporting.
- Capital Raising Partner – Someone experienced in bringing in investor dollars.
- Operations & Asset Manager – Especially crucial in real estate funds.
- Co-General Partner (Co-GP) – If lacking experience, consider bringing in a partner with relevant expertise.
The right team depends on the asset class, deal structure, and personal skill set. Some team members will be full-time partners, while others (e.g., attorneys, accountants) will be engaged as needed.
Case Study: YourSpace America
Atkinson shares an example of a client, YourSpace America, a self-storage syndication firm. One partner, Billy, specializes in raising capital and marketing, while the other, Ross, is the industry expert on self-storage and deal structuring. This division of labor allows them to maximize their strengths while filling gaps through teamwork.
Key takeaway: Know your strengths and weaknesses. Build a team that complements your skill set.
Step 3: Lay the Groundwork for Raising Capital
Even before launching a fund, fund managers should start laying the foundation for investor relationships.
How to Prepare for Fundraising:
- Talk about your asset class & strategy publicly – Mentioning deals in conversation sparks interest.
- Build a contact list (CRM) – Track people who express interest.
- Leverage existing relationships – Start with friends, family, and professional networks.
Why This Step Matters
Raising capital is always a “heavy lift,” even for experienced fund managers. Building relationships before launching a fund ensures that when the time comes, there’s already a pool of potential investors.
As Andy Hagans notes, even highly successful fund managers raising nine-figure funds say, “It never gets easier.” Starting from zero relationships makes the process even harder.
Common Fundraising Challenges & Solutions
1. Investors Want Proof of Experience
- Solution: If you lack experience, partner with an experienced GP or complete a smaller deal first.
2. Capital Raising Cycles Are Long
- Solution: Nurture relationships well before launching. Investor trust takes time to build.
3. Investors Care More About the Team & Thesis Than IRR Projections
- Solution: A strong team and compelling story matter more than a 1-2% difference in IRR.
Case Study: Opportunity Zone Fundraising
Atkinson recounts advising a client debating whether to pitch at an upcoming investor event. Their concern: their capital raise was closing in 30 days, and they weren’t sure if participating would be worth it.
His advice:
- Think long-term – Investors from this event may not commit immediately but could invest in future rounds.
- Fundraising is ongoing – The first raise is just the beginning. Maintaining investor relationships is crucial.
Other Questions From The Audience
The episode concludes with live audience questions.
1. What IRR Are Investors Looking for in Real Estate Funds?
- Generally, investors look for 13-18% IRR.
- Lower IRRs (~8%) may seem unattractive compared to public markets.
- Higher IRRs (~20%+) can raise red flags about risk.
- Investors care about team & investment thesis more than minor IRR differences.
2. How Do You Market a Fund to Investors?
- Have a clear, compelling, and simple story.
- Repeat the story consistently across multiple platforms (podcasts, webinars, articles).
- Build brand authority in a specific niche (e.g., “We are the experts in private credit in the Pacific Northwest”).
- Use educational content to engage investors before making an ask.
3. What’s Your Favorite Asset Class?
- Atkinson: Multifamily housing – a long-term play due to persistent housing shortages.
- Hagans: Multi-tenant retail – higher cap rates and attractive value-add opportunities.
Conclusion: The Path Forward
Launching a fund is challenging but achievable with the right steps:
- Clarify your investment thesis – Write it down.
- Build your team – Identify strengths & weaknesses, find complementary partners.
- Start investor conversations early – Fundraising begins long before your SEC filing.
The Fund Playbook community aims to support fund managers through this journey. Every Thursday at 3 PM Eastern, Atkinson and Hagans host a live Q&A session on YouTube, where viewers can get real-time advice.