What are some of the best resources for starting to raise capital as an emerging RE developer?
Often times people start with friends and family in country club deals but I was wondering what institutions back smaller deals for small RE developers (if any at all).
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General rule of thumb is that your first money has to come from professional contacts that know you and have done deals with you for some time. That forms your initial capital base. That can be your old boss, people who did syndicate deals with you in the past, former co-workers who have money, PE funds that you worked with on deals, etc. Later, you will need to cultivate your own non-close capital sources. That's harder. For that you need to have a track record and portfolio of previous projects, and then go in over time and build those relationships. Generally getting a warm intro to those LPs is best.
So step by step: 1) find and underwrite some good potential deals 2) circulate the deals with related parties that can finance you 3) exit those deals successfully and have a portable track record 4) let others know you're looking for capital sources. Attend conferences. Network. 5) over time show your deals to capital sources and build comfort and relationships