In today's investment landscape, fund managers and syndicators face a common dilemma: How do you scale your business and pursue new opportunities when traditional capital raising models are so rigid (and expensive)?
Unfortunately, some people don’t even realize this is a problem, because they’ve never considered using anything other than the traditional syndication or fund model.
But if you’re someone who’s ready to grow faster — and you recognize that you need flexibility to respond to rapidly changing market needs — then the customizable fund may be the innovative solution you need.
Here’s How a Customizable Fund Works
A customizable fund combines the flexibility of deal-by-deal syndications with the accessibility of a fund to create a best-of-both worlds solution for capital raisers and investors.
With a customizable fund, you can house all of your deals in one place, rather than needing to do separate fillings for each syndication deal. And unlike a traditional fund, you can include multiple asset classes and business models within the same fund.
This adds up to significant cost savings for fund managers, and it appeals to investors who can invest on a deal-by-deal basis, rather than blindly contributing to a fund with no control over how their capital is used.
Keep in mind that Avestor is the only platform that supports the creation of customizable funds. We’ve built this solution to be completely SEC compliant, and to generate significant cost savings for fund managers.
With a Customizable Fund, You Can…
Pursue New Investment Opportunities
When you’re managing a traditional fund, all deals in that fund need to be in the same asset class. And while a syndication allows you to invest on a deal-by-deal basis, it doesn’t give you the flexibility to invest in asset classes outside of real estate.
That all changes when you switch to a customizable fund. With Avestor, you can invest in:
- Self storage
- Single family homes
- Senior living
- Office space
- Medical centers
- Student housing
- And much more
All within one customizable fund!
Avestor fund managers can also get creative when building their funds, creating custom deal structures on every deal. In addition, you can generate revenue from fund management fees, acquisition fees, GP/LP splits, origination fees, and various other compensation models.
Appeal to a Broader Pool of Investors
Imagine that you had $50,000 to invest. Would you feel comfortable putting all of that money toward a single real estate deal, or would you stick to assets that have smaller investment minimums?
Most accredited investors are not comfortable putting all of their money into a single deal. And yet, the high investment minimums of most syndication deals create an unattainable barrier to entry to many.Add a deal (or multiple) to the customizable fund
When you create a customizable fund on Avestor’s platform, you can bring your deals to a much larger pool of investors. As the fund manager, you can set a minimum investment to join the fund, and a smaller minimum investment for each deal. This minimum amount can even differ on a deal-by-deal basis.
This allows investors to diversify within one fund, fractionalizing their investment into smaller deal-by-deal slices, or investing all their capital into one deal if they choose to do so.
Grow Faster through Collaboration
Finally, a customizable fund provides access to a network of like-minded fund managers, offering opportunities for collaboration and partnership. Every Avestor fund manager gets access to our exclusive mastermind.
And because of the flexibility of the customizable fund structure, Avestor fund managers frequently raise capital for each other's deals or invest as co-GPs on a project.
If you're interested in learning more about how a customizable fund can transform your business, let’s connect! Book a demo call today to get started.