If you are relatively new to the Sumrok Ecosystem, there are typically six roles that must be fulfilled on your GP team (not necessarily by six people but all need to be addressed). Additionally, there is often crossover.

For example, typically, everyone raises, but some are more connected to be able to raise more and better manage those relationships. Everyone underwrites to determine if the deal is worth doing, but usually, someone is particularly gifted at it. Credit to my partner Mike Herman for putting this together. Here are the six roles:

The Dealmaker

Do you live in or near your target market and are great at building new relationships? If so, being the “boots on the ground” might be a good fit for you. You can help with sourcing deals, which largely comes from building relationships with brokers in the area. Live across the country, but think this still sounds like a good fit. No problem. As long as you have the time and resources to travel frequently.

Building these relationships takes time. Brokers are the gatekeepers of most deals, and it is highly unlikely they will give you the time of day if you don’t make an effort for face-to-face interaction. When you are just starting, we recommend finding a deal in a market you are not interested in and calling the broker. That way, your first time talking to a broker isn’t with one in a market you care about. A good way to practice (just don’t waste too much of their time!). Live in the area but not much of a people person? That’s ok too. Maybe underwriting is better for you.

The Underwriter

Are you analytical? Can you stare at a screen for hours on end? Do you love numbers and spreadsheets and crunching data? Well, you might be a great underwriter! This is an incredibly important piece of the puzzle, as it is where all the projections come from and ultimately direct what you can offer on a property based on your target returns. Even if you are not the primary underwriter, all team members should have familiarity with this and be able to give an independent review.

The Investor Relations Manager

How big is your investor database? Do you know people who are willing to invest with you? All sponsors should participate in capital raising. However, if you have a network of potential investors ready to deploy their capital, you can bring value to one of the more difficult aspects of syndication.

We want to caution that there are strict SEC rules against being compensated solely for being a capital raiser without a broker dealer’s license, so make sure you also have other clearly defined and substantive duties on the team throughout the hold of the property. Raising $1-2mm with ease is a good start. In other words, never call yourself a “Capital Raiser,” as that cannot be your sole job unless you have a broker-dealer license.

The Experience

Do you have an impressive real estate resume? Experience is the one piece you can’t learn from a module or in a book. One common theme in the group is that people who joined around the same time gravitate to one another and try to find deals together.

This is great; they can learn and grow together as they find who they click with for future partnerships. The only issue is typical. None of them have the resume piece of the puzzle required to land these large deals. So just be sure that as you are networking, you are also getting to know veterans who can join you on deals you find or bring you in on their deals until you are experienced.

The Baller

By joining this group, your liquidity just took a bit of a hit, but your return on that investment will be far greater! To qualify for a loan on these large apartments, significant net worth and liquidity is required. You can add value by bringing an impressive Personal Financial Statement to the team. This will help limit the amount of GPs needed in the deal, increasing GP returns as they are split between fewer people. You can also get a start on your resume by being a Key Principle, which means you bring your net worth and liquidity to sign on a loan without being a GP.

Sometimes KPs are compensated for their role in securing the loan. Other times they are willing to be a KP without compensation just to have a large commercial loan on their resume. Whatever the case, being open about your financial strength with others in the group as you network could find you in a deal faster than you’d think.

The Asset Manager

This last one provides a nice bookend to the first, as this is typically done by someone who lives within driving distance of the property. While living nearby is not a requirement to be a good Asset Manager, it will help investors have confidence in your team. If the Asset Manager can check in on the property at a moment’s notice, especially when new. The asset manager ensures the property management company keeps things on track and that planned renovations are going as scheduled. They hold weekly calls with the Property Manager to review Key Performance Indicators (KPIs) such as delinquencies, vacancies, new leases, etc.

The Asset Manager ideally has experience running a business or a background in business or construction management. Ultimately, the property’s performance hinges on the asset manager’s ability to execute the business plan, which is why there is usually an Asset Management Fee (typically 1-3%) for their ongoing duties. The more experienced they have a proven track record, the higher the fee they command. You may not be the Asset Manager on your first or second deal, but don’t miss the opportunity to learn from whoever does have this valuable role and be willing to provide support as a junior asset manager.