Building an Effective Syndication or Investment Fund Team: Roles and Responsibilities

Your syndication or investment fund team should have defined roles and responsibilities to ensure smooth operations and investor satisfaction. Here are seven key roles and how they contribute to your overall success. To get started with your syndication or fund visit https://www.moschettilaw.com.

Establishing clear roles and responsibilities within a syndication or investment fund team is essential for preventing misunderstandings and ensuring effective operations. Tilden Moschetti emphasizes the importance of delineating these roles to avoid conflicts that could negatively impact investors. By defining responsibilities early, team members can work more efficiently, leading to better outcomes for both the syndicators and the investors.

He identifies seven key categories of roles: investment and finance, investor relations, operations and project management, compliance and legal, accounting and bookkeeping, tenant relations, and project management. Each of these roles plays a vital part in the syndication process. For example, the investment and finance role involves tasks like acquisitions, due diligence, portfolio management, and risk management. Similarly, investor relations focus on capital raising and maintaining clear communication with investors, ensuring they have a dedicated point of contact for their queries.

Operational and project management roles ensure that all aspects of property management and team coordination are handled efficiently, while compliance and legal roles focus on adhering to regulatory requirements and ensuring timely filings. The accounting and bookkeeping role is crucial for maintaining accurate financial records and building trust with investors through transparency. Lastly, tenant relations, often overlooked, are vital for maintaining good relationships with tenants, which in turn supports the overall health of the investment.

By clearly defining these roles and ensuring that each team member knows their responsibilities, syndicators can create a harmonious and productive work environment. This structure not only helps in achieving the financial goals of the syndication but also builds a solid foundation of trust and reliability with investors, ultimately leading to more successful and repeat investments.

Read more about Reg D - What is Reg D? The King of Securities Exceptions: https://www.moschettilaw.com/reg-d/

Read more about PPMs - What Is In A Private Placement Memorandum?: https://www.moschettilaw.com/private-placement-memorandum-attorney/

Moschetti Syndication Law Group is a boutique syndication law firm, serving small and growth-bound syndicators, as well as private equity firms. Our attorney, Tilden Moschetti, is determined to keep the firm’s ‘boutique’ size so we can tailor the services to each client’s unique needs without turning the firm into a faceless factory churning out private placement memorandums or passing unnecessary overhead expenses onto our clients. (As our client, you’ll only pay a fixed fee, so no surprises.) As for the client experience, we give real-time answers with Tilden Moschetti without making you book an official appointment or get passed along to associates or paralegals. We’ll work with your ambitions and overall vision to help you close the current deal and fill in that ‘missing’ piece – whatever you need – to keep adding more syndications to your portfolio. We keep syndicators syndicating (TM).

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Episode Transcript

Tilden Moschetti (00:00):
If your syndication team or investment

(00:02):
fund team has more than just youworking in it, it's probably
helpful to think about roles andresponsibilities, who should be
doing what to make sure thatthere's not some problem down
the road that ultimately isprobably going to impact your
investors. If you guys can't getalong the sponsors, and the
managers can't figure it out,then it's going to trickle down.

(00:23):
And there's going to be problemsfor your investors, which could
make your whole situation a lotworse. So why not deal with
those things upfront? In thisvideo, we're going to go through
the seven different maincategories of roles and the
responsibilities of them to sitegive gives you a place to start
thinking about them, to give youa place to say okay, well, maybe

(00:46):
this person should beresponsible for this or this
person should be responsible forthat.
My name is Tilden Moschetti. Iam a syndication attorney. I
help a bunch of syndicators,investment funds, put together

(01:08):
their legal documents and formtheir investments, right. So put
together those syndications andthose funds. as I go along the
way, I see a lot of differentteams come together teams of two
teams of five teams of 10. WhenI see that one thing, I'm not
immediately think if it's morethan one person is we might have

(01:30):
some sort of thing where we wantto identify the roles and
responsibilities early so thatthe syndicators can do their job
better to make them so moreconfident in what they're
supposed to be doing. So thatneither, nobody gets mad at
them, right. I mean, at the endof the day, we just all want to
do the best we can we want tomake the most amount of money
for ourselves certainly make themost amount of money for our

(01:53):
investors, so we keep gettinginvestments from them, so we
make more money for ourselves.We can help that process by
identifying what the roles andresponsibilities are between the
team members. And I've also donea number of syndications for
myself, I've worked with anumber of teams myself, let me
tell you, the teams that I'vebeen in where we did not define

(02:16):
a clear set of roles andresponsibilities, something
always happened, something wherepeople felt like they were being
taken advantage of or peoplewere not doing the right job, or
whatever it was. Setting thosethings up early, is what I do
now all the time, if I'm goingto be in a team, and you should

(02:37):
think about that, too. So let'sgo through exactly what kind of
categories I think are usefulfor you. When you're setting up
a team, there are seven of them.One such role and responsibility
that I think is useful to gothrough is investment and
finance. This is a syndicationor investment fund. So
obviously, finance investmentsare very closely coupled with

(02:59):
exactly what you're doing. Sothis in this category, what
we're thinking about are thingslike acquisitions, how are you
going to determine if somethingis a good buy or not? Due
Diligence? How are we going tomake sure that it's a good buys
so that something doesn't fallthrough the cracks, something
that we're buying is actuallywhat we're buying, looking at
the portfolio as a whole, ifyou're buying an investment

(03:22):
fund, and everything'sidentical, you're not getting
the benefits of diversity,you're not getting the benefits
of different kinds of assets,which could lead to better
results with lower risk. Actingas the Chief Financial Officer,
the one who really is in controlof the money also goes into this
category. Also, in this categoryis risk manager, like

(03:45):
identifying what risks there areto the investment. It's not
always things that come out ofdue diligence, it might be
governmental, it might be thingsthat are just happening locally.
If it's a real estate deal,maybe it's something that's
happening in the propertyitself, and you need to get
insurance for it to cover that,that risk. And lastly, is that

(04:05):
Exit Planning. So who was goingto make the kind of
determination that really, maybeit's time for us to make the
sale, maybe it's time this iswhen we can make the maximum
amount of profit for ourinvestors and ultimately for
ourselves. The second categoryis investor our Investor
Relations, investor relations,not only is the talking to

(04:27):
investor bit, but it's acting asa point person for investors to
come to. Now, most of the time,this person is also involved in
the sales process. They're theones who's actually raising the
capital. They're going out tothe market, they're making sure
that those investors are there,and they might have multiple
people on your team who do thisrole. At the end of the day, I

(04:50):
would recommend that you alsohave one person who's the key
contact. This is the key personwho investors can ask questions
to if they have them. They maybe responsible for also the
communications to investorswriting out those quarterly
emails to update them. And thatwill invite more people to
communicate back in, I thinkit's helpful for investors to

(05:12):
know, okay, if there's aproblem, I talked to this
person. So the investorrelations role is pretty wide.
But it also is a critical part.So not only is it the capital
raising, that's absolutelyfundamentally critical. But it's
also those other things, makingsure that you have that key
contact person. Another key rolethat's in a lot of syndication

(05:36):
and investment fund teams, isthat operational and project
management. So if you're doinganything more than just buying
specific properties and sellingspecific properties, there's
probably something that's goingon, on their assets that need
some sort of coordination andsome sort of work. If not,
there's definitely still somethings that happen with your

(05:58):
team. Right. So there's multiplepieces to this. So part of your
operations might be the portalsoftware that you're using, you
know, making sure that everyinvestor can log in making sure
that all those things are there.But also on is this Project
Management site. Now, long ago,I had a project management
background, I was a certifiedproject manager. And actually,

(06:21):
it is a fundamental way to makesure that projects follow
through very specific steps, Iwould suggest that you adopt
that same kind of methodologythat's built into into project
management, to make sure thatyour projects go the way they're
going. Now, that project mightlook something like rehab on a

(06:41):
building, or the m&a on on thepurchase of a of a of a business
or something like that. Or itmight be just as simple of, Hey,
how are we going to make surethat the marketing communication
for the sale goes out because wedecided we want to do a vote. So
there's multiple pieces,different kinds of ways this
comes in. But the focus of thiskind of role, or these kinds of

(07:04):
roles is that operational andproject management side, another
function that's useful, and itmay not be just, it may not be a
whole person, it might be justdelegated to one of the other
people within your team iscompliance and legal. So
obviously, as a lawyer, that'swhat I care about a good luck,
great deal. But it's also makingsure that those blue sky filings

(07:26):
are getting served, making surethat the documents being
prepared by your syndicationattorney are are prepared
correctly and in the right way.And in a way that's useful,
making sure that everythinglooks right and that all the
kinds of reporting that needs togo on for your syndication
happens in the timely manner.They may also be interested in

(07:47):
well, when is when are taxfilings due? And when is the k
one Do they may work with thefinance person in order to
ensure the taxes are done ontime or as best as you can? So
that compliance piece reallymake sure Okay, as a team, are
we doing everything that we needto do in order to be compliant.

(08:07):
A lot of times you'll bring inoutside counsel like a
syndication attorney likemyself, in order to make sure
that all those things happen. Inmy I also coordinate with an
accountant who specializes insyndications or investment funds
or real estate or what have you.Another key role is accounting
and bookkeeping. Now, this tomany of us is not the most

(08:29):
glamorous role, but a lot oftimes that has fallen on me. So
I do recognize that it is there.And I recognize it's a lot of
work. So the accountant andbookkeeping role is very
critical to a syndication, Imean, picture this, you have an
investor who gave you a reallylarge amount of money
100 200 300 A million 1000 Amillion dollars. I

(08:53):
mean, that's, that's notuncommon, by me saying 100 200 I
mean, 100,000 200,000 300,000million dollars, it's a lot of
cash, they need to know thattheir money is being treated
properly, you need to know thatthe books are being kept in the
right way. I have investors inevery single deal that I do for

(09:13):
myself, there is going to be oneor two people that want a lot of
detail on those books. And theyshould have it you should be
able to get a call from from aninvestor requesting a copy of
the general ledger and send itto them right away. What does
that do? It builds trust, whichmeans that they're likely to be

(09:33):
investors again in the futurebecause they see not only are
you doing everything by thebook, but you're so responsive
that you can provide those at aheartbeat because you care about
their money and the and thecustody of it. One role that's
oftentimes overlooked is atenant relations and you can
think of it as a Human Resourcesrole. So human resources role

(09:57):
would be something like as iseverybody on the team working in
The best way possible, if wehave contractors or if we have
other employees, are they beingtreated in the right way? Are
they on boarded properly or offboarded properly? Are we making
sure money is happening in theright way for them? Those sorts
of things. But also one thingthat is oftentimes overlooked is

(10:18):
tenant relations. Now, if you'redoing a real estate syndication,
more likely than not and lessonsdevelopment, you have tenants,
the tenant role the care oftenants is different than the
care of investors, the personwho cares about the the feelings
in the business, and all thosethings at the tenant are

(10:38):
probably not the same as theinvestor relations person. Yes,
you can combine them, but it'softentimes not, oftentimes, it's
not the best place. Because ifyou have tenants who are looking
up, you know who you are, andwhat you do, if you have
somebody who's just in theinvestment relations section,
doing tenant management, thetenants not going to feel that

(11:00):
you've got their best interestat heart. Now, granted, you
don't actually have their totalbest interests at heart.
Ultimately, you care mostlyabout your investors. But good
tenant relations is also veryfundamental. We want them to
know that you're there and thatyou're listening to them. And
not just whatever for the sakeof investors, right. That builds

(11:22):
trust and loyalty amongst thosetenant, which really is the
lifeblood of your fund. Ifyou're doing a real estate fund,
that's not development. So thoseare the seven key different
roles and responsibilityhierarchy that I see those seven
different categories, apply inevery syndication, you should
think through those and decidewhether or not they make sense

(11:44):
for you, and how you're going tosolve the specific problems
within them. Who's going to beresponsible for them? Now,
obviously, if you're working foryourself, you're doing all of
those. If you're not working foryourself, they have it's not
just one of you, if you've gottwo people, or you've got 100
people, well, 100 would be verybig. But if you've got more than
one, it would be it's you needto have this conversation about

(12:07):
exactly who's going to be doingwhat the reason is to make sure
that feelings are happeningproperly, that roles are getting
taken care of that nothing isgetting missed, and making sure
that everybody also feels goodabout it. I've been talking a
lot about feelings in thisvideo. And I understand that the
some of you may be why is hetalking about feelings, this is

(12:28):
a very logical thing. And it is.But at the end of the day, we
are emotional creatures. If youfeel like you're getting
slighted, you're not going to behappy and that not feeling
happy, is going to translate tonot making as much money for
your investors, which is goingto translate to not making as
much money for you. My name isTilden Moschetti. I am a

(12:48):
syndication attorney. And I knowthese things because I've also
got the experience of havingdone deals myself, having put
these things together, workingwith teams myself in the
trenches, having the argumentsover roles and responsibilities.
Now I'm sure I can help you ifyou're putting a Regulation D
offering together under Rule 506B or 506 C I welcome your call.

(13:12):
Let's talk about your projectand see what I can do for you