Should you manage a fund or go into syndication? What’s the better investment strategy – fund or syndication deal? Tough decisions to make. Although both can be great vehicles for creating wealth, their differences are enough that you should weigh the pros and cons of each against your investing goal, your skills and experience in the industry, and your capital. What’s crucial is your trust and confidence in your strategy and in your sponsor.
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Our guest today, Steven Libman, talks about various aspects of managing funds and will help us weigh its plusses and minuses. As managing partner of Integrity Holdings Group, Steven had experienced both types of investing having shifted from syndicating commercial real estate to managing funds. So, whether you’re a passive investor or an active operator, you’ll learn valuable lessons and insights from our conversation today.
Key Points From This Episode:
- Background of Steven’s transition from operating commercial real estate to managing a fund.
- Why a SWOT assessment is necessary for a company to build a culture of accountability and transparency.
- How lack of asset management experience prompted the transition to fund management.
- Steven enumerates the advantages of managing a fund compared to syndicating.
- Why fund management requires fewer employees than syndication
- How managing a fund allowed Steven’s company to focus on their strong suit – investor relations
- Why they use a third-party fund management company.
- How managing a fund gives the opportunity to work with many experienced operators.
- How Steven communicates the plus side of fund management to their investors.
- Why they decided to manage an open-ended fund with an annualized plan.
- Steven’s predictions on the real estate industry, his best sources for new investors, and the main drivers of his success.
- The many ways that Steven gives back and why giving abundantly is the center of their business.
“How do we give more abundantly now before we “make it”?”
“We all know that compound interest is the eighth wonder of the world. I’d much rather compound it every 5 years than never. But how do I compound it even faster?”
“For us, it was the right move because it was where our strength lies. It gives you the option to work with many experienced operators that have a lot more deal flow than you would be able to create on your own.”
“Know thyself in terms of what you like doing, what you’re good at doing. I like talking to people about what it is that benefits long-term generational wealth creation and giving abundantly through these types of properties. Not picking paint colors. It’s not to say it’s not important. It is, but I don’t like to do it.”
“What is the biggest threat to our money? It was us. That’s just a real analysis as to what the threat was to the investor’s capital. Why were we the threat? Was it for lack of diligence? Was it for lack of persistence? Was it for lack of passion? No, none of that. It was for lack of experience.”
Links Mentioned in Today’s Episode:
About Steven Libman
Steven Libman is one of the Managing Partners of Integrity Holdings Group. Prior to Integrity, Steven began as a Realtor, and then flipped almost 1,000 properties in the residential real estate space. After getting burnt out in a very transactional, highly taxed business model, IHG moved into the multifamily and self-storage space to create passive, tax-advantaged income for themselves and their investors.
Steven has a B.A. from Boston University and has contributed and been recognized by a number of different industry publications including Forbes, and the Top 100 in Real Estate. IHG also runs a donor-advised fund where it carves out a percentage of company income to create passive income for non-profits around the world.
In his spare time, he focuses on spending time with his wife Grace and 3 children, volunteering at his local church, playing golf, and tennis. A self-described foodie and personal growth-focused entrepreneur, Steven has a desire to help people reach their own personal and investment goals through any means possible.
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