b'Chapter 3Why Syndicate or Create a Fund?Realestateentrepreneurssyndicateandcreatefundsbecauseitsa means for them to achieve their goals of buying bigger and more properties, and perhaps a means to exit a less-than-fulfilling job. At the same time, asset managers can help their investing family, friends and acquaintances achieve their own financial investing goals. But how, specifically, do asset managers earn money? First, lets talk about the participants.What Do Participants Contribute to a Syndicate or Fund? What Do Investors Contribute? Investors make capital contributions that are used to pay for the down-payment, closing costs, operating capital, capital improvements, legal fees, certain management fees and reserves.What Does an Asset Manager Contribute? The asset manager makes non-capital contributions of knowledge, time and effort, and actively oversees property management of real estate assets (properties) on behalf of a syndicate or fund. Specifically, the asset managerwillanalyzeproperties,makeoffers,getthemundercontract, organize the offering documents that will be presented to investors, conduct due diligence prior to acquisition and verify all seller-provided information, oversee property improvements, and manage the entity that it created to own 14'