Structuring deals with friends and family
Curious to get peoples thoughts.
have brought friends and family into a few syndication deals with GPs I've developed relationships over the years. I have always invested alongside any friends/family but starting to see more deals than I have funds for.
have been thinking about continuing to bring deals to friends and family but structure them with some sort of promote where I don't put anything down (or something minimal) but take a [20%] promote over some hurdle [8-10%]. Would be fine not getting paid until exit. Thought process is there is some value in the relationships I've developed and opportunities uncovered, and there is some level of return that clearly beats my friends and family's money sitting in bank accounts.
but other side of me feels a little to scheme-y with friends and family. Would obviously disclose everything.
would you do something like this or not even consider it? Goes without saying, but I would underwrite deals as if investing my own money because I do not want to be responsible for family losing money.