Before you invest in a syndication, ask one simple question:
Is the sponsor investing their own money?
Many investors spend hours reviewing projected returns.
Very few spend enough time evaluating alignment.
Because here's the reality:
People pay closer attention when their own capital is at risk.
That's why one of the first things I want to know is whether the GP has money in the deal alongside investors.
Are they sharing the same risks?
Are they committed to the same outcome?
Do they win only when investors win?
A sponsor who invests their own capital is sending a powerful signal.
They believe in the deal enough to put their own money on the line.
That doesn't guarantee success.
But it does tell you a lot about conviction and alignment.
When evaluating a syndication, don't just study the property.
Study the incentives.
The best deals often start with the right people making decisions for the right reasons.
Save this question for the next syndication opportunity you review.
