Investment deal structure
I had a quick question for you. I am thinking about investing in a real estate fund with my friend. The fund has a minimum cheque size of $50k, which we plan on each putting half into ($25k my friend, $25k me). Since it can only be under one entity, our current thinking is to:
- Do a handshake deal where I give him the money and he puts in $50k under his name and we share profits / losses
- Put together a legal structure to do this
On 2), while I think this is the safer option, I am not sure how difficult this will be. How much will it cost? What are the options (LLC vs corp) and which is best? Would love to see what the group thinks. Also if there are any software solutions you would recommend, I am all ears.