13 Lessons Learned From 13 years of Private Syndication Investing

If you talk with me about real estate, you will soon find out that I am
a huge fan of passively investing in
private syndications. However, my initial investments into syndications did
not go well. You may wonder why I trusted any syndicators after those

After witnessing my net worth plummet after each stock market crash in
2000-01 and 2008, I was desperate to get some of my money off the “Wall Street
roller coaster”. After reading books about alternative investments and
attending local real estate conferences, I stumbled upon a group that was
looking for investors interested in speculative, oil and gas syndications. The
double-digit, cash-on-cash, pro forma returns were mesmerizing, and being able
to deduct a large percentage of the intangible drilling costs off my taxable
income was appealing. I vetted the group as much as I could by doing searches
online and talking with a few of their early investors. After reading the legal
documents, such as the private placement memorandum and the operating agreement,
I mailed my check to the company in Texas in 2009.

I started to receive some small distributions within a couple of months.
That was enough proof of concept for me. I proceeded to invest in a few more of
their speculative oil wells over the next few months. After another six months,
the frequency and amount of the checks began to diminish. The communication
also dwindled. And then everything stopped. Other than a handful of small
checks and getting the tax deductions, I lost all of my original capital. It
took a few years for me to figure out what had happened. Some articles online
revealed that this group had scammed over a hundred investors for several
million dollars.

Six years later and after a short stint in actively investing in small,
residential buy-and-holds, I decided to get back into the syndication game as a
passive investor. Even with my experience in the oil and gas debacle, I still
made some mistakes with those next investments.

Here are 13 valuable lessons I have learned personally and from others
in my ongoing involvement with syndications and their sponsors.

 Get sponsor referrals from passive investors who you
know, like, and trust

When I wired my money to the oil and gas sponsors, I did not have any
friends or acquaintances who had invested with them. Be leery of referrals from
the sponsors. Who knows if they are actual investors? If you have a friend who
has invested in four deals with Sally the Syndicator over the past six years
and tells you that she communicates with her investors regularly and gives out
steady distributions, wouldn’t you feel more comfortable about sending your
money to Sally? Don’t reinvent the wheel – learn from the past experiences of
others. This brings me to my next point.

 Network, network, network!

Even when I got back into syndications in 2016, I still did not know
anyone who was doing what I was doing. I went to several local real estate
meet-ups, and they were always talking about flipping houses and adding
single-family homes to their portfolios. I eventually attended some national
conferences on real estate syndications which did help expand my network.

A little over two years ago, I got an email regarding the next meeting
for a local real estate investing group (not Left Field Investors). The speaker
was going to be Jim Pfeifer, who was the head of that group, and he was going
to talk about his transition to full-time passive investing. I emailed Jim
immediately and told him that I was also getting involved in syndication
investing. We ended up having coffee together and discovered that we had even
invested in some of the same deals! This gave me the confidence that what I was
doing maybe wasn’t so crazy after all!

As an introvert, networking does not come naturally to
me. I tell myself that I need to get out of my comfort zone and chat with
strangers at these meetings. Bringing a friend can certainly help your
confidence. There are more and more
conferences[1]  catering to passive
investors, and they are also a great way to meet sponsors one-on-one. As you
continue to network, the chances that you will meet people who can help you
attain your goals will increase exponentially.

 Invest in yourself

How much is your time worth? Randomly finding information on the
internet can certainly be one way of educating yourself on a topic, but it is
usually inefficient and insufficient. When I was first learning about
syndications, I read
books and blogs and listened to countless podcasts. But it wasn’t until I paid to attend a few conferences on syndications
that I had a better handle on vetting sponsors and deals. Attending these
weekend seminars helped me to compress time frames. If you are interested in a
certain asset class, read books and listen to podcasts pertaining to that
sector. There are many home study and live virtual courses that will give you
confidence in learning about passive investing.

Back in 2009, I wish I had a group where I could discuss investment
ideas. Join a network like the
Infield where we talk about all
aspects of investing in tangible, cashflowing assets in our private forum and
during our Mound Visits – weekly calls lead by one of the founders.

 Wait one year before investing again with the same
sponsor (if this is your first deal with them)

I wish I heard this advice before I sent my second check to those oil
and gas syndicators. I recently learned this excellent rule from one of the
members of our Infield Community, David Shirkey, who also runs his own
investing and
networking group
. One year will give you enough time to see if the syndicator provides
detailed and regular updates and to see if the distributions are close to the
first year’s pro forma numbers. This can be a tough rule to follow if they have
good deal flow and if all their deals look like home runs. But this can give
you a chance to practice the next lesson.

 Diversify your investments by asset type, sponsor,
geography, timing, and debt/equity deals

I do not consider myself a general partner-level expert in any asset
class. When I invest with a sponsor that I have vetted, I do expect their team
to be specialists in the asset class in which I plan to invest. Nonetheless, I
believe as a passive investor you should
diversify to some degree. Having a solid, passive portfolio in various asset
classes such as multifamily,
self-storage, mobile home parks, industrial facilities, and ATM funds will help hedge your investments.

This plan will also help you automatically diversify your sponsors. I
would take that a step further and invest with different sponsors within the
same asset class. Some sage advice that I learned from reading
Do the Work Once, Get Paid
by John Bogdasarian is “Don’t invest more than 20 percent of your net
worth with one person or entity”. Even if you trust a sponsor implicitly,
anything can happen that may be out of their control. By spreading your
investment dollars around, you will de-risk your portfolio. Real estate trends
tend to be local so spreading your investments by geography is also wise.

One aspect of diversification that is overlooked is timing. Some new
passive investors discover the world of syndications and end up dumping a large
amount of money with various sponsors in their first year! Although I applaud
that they are investing in real assets, I question whether they should space
out their investments. We all know that real estate has its cycles.

One other way to diversify is to invest in both debt funds and equity
deals. The former should give you more steady cash flow while the latter will
hopefully increase your net worth when they go full cycle.

 Invest in “boring”

Many active and passive real estate investors, including myself, are
guilty of the so-called
shiny object
. Some of my early passive investments included a feature movie, a
Panamanian coffee farm, resorts in Puerto Rico and Costa Rica, and a Broadway
show (yes, I am not kidding!). Although the musical has been giving great
returns, the other four assets have yet to give out any distributions in four
to six years!

Do not get caught up in shiny object syndrome! Unfortunately, I have a
decent amount locked up in those non-cashflowing assets. If I had used that
money to invest in two, “boring” apartment complexes in Texas, they probably
would have gone full cycle by now, and I could have reinvested the original
capital and the profits into three or four other
multifamily assets! The importance of the time value of money cannot be
emphasized enough!

I will admit that I do invest small amounts into start-up companies
hoping for that huge, asymmetric gain down the road if they go public. However,
I do limit the sum total of these investments to a single-digit percentage of
my net worth.

 Don’t just look at the “Big 3” – cash-on-cash,
annualized return, and equity multiple

Early in my passive investing adventures, I made the mistake of simply
using the return metrics to vet the merits of a deal. Of course, you want to
know how much cash flow you may expect annually and your total profit when the
asset sells, but you absolutely need to consider the
riskiness of the deal. In my
opinion, the most comprehensive book on this topic is
The Hands-Off Investor by Brian Burke. Even
though this book pertains mainly to the multifamily asset class, the concepts
discussed in it can be applied to most real estate investments.
All Infield
have access to the LFI Deal Analyzer, a spreadsheet that will walk you
through the financials in the cash flow statement to make sure the underwriting
is conservative.

 Don’t let the tax tail wag the dog

As I mentioned earlier, one of the appeals of the oil and gas
investments was the tax savings that I would receive. This certainly can be a
game-changer, but if the investment is not giving you steady
cash flow or a nice equity multiple when it goes full cycle, then it may end up
being a wash. Assess the riskiness of the deal by evaluating, among other
things, the location, the underwriting, and the bank financing terms. Warren
Buffet’s first rule of investing is “Never lose money”. His second rule is
“Never forget rule number one”. What good is a tax shelter if you do not have a
net positive result? Learn about the “Lazy 1031” syndication tax strategy in

 Ask if a sponsor will take a reduced minimum

I did not know that this was a possibility until I heard other Left
Field Investors doing this. Although you do not want to be annoying by asking
every time if you can invest less than their published minimum, I think this
may be appropriate to “test the waters” with a sponsor with whom you have not
invested. Increasingly, sponsors are becoming more familiar with the great
things happening at Left Field Investors and have allowed our members to get in
on deals at a lower minimum.
Just mention our name and ask! The worst they can say is

 Being a podcast host or guest does not necessarily
equate to being a great sponsor

Some people talk a good talk. Being the host of a podcast or even just
being a guest on a podcast gives the appearance of authority which can have
great influence on people. Many of the sponsors I talked with early on were
people whom I heard on podcasts. Even though it may feel like you know them
before you have your initial call with them, don’t be fooled by this. Try to be
as objective as possible when you interview them. If this is the best way for
you to find sponsors, then see if other people in your network have invested
with them.

 Don’t be anyone’s guinea pig

This is one of Jim Pfeifer’s favorite expressions. Be careful when you
are considering sponsors who are raising money for their first syndication.
They may have flipped 53 houses and owned/managed 32 single-family homes in
Lincoln, Nebraska, but commercial real estate syndications are a different
animal. That kind of experience is invaluable, but you do not have to be their
experimental guinea pig. There are so many experienced syndicators out there
who have been through several commercial real estate cycles who would be better

Also, be wary of the experienced, commercial real estate sponsor who is raising capital in a new-to-them asset class such as the
veteran, mobile home park operator who wants to get into A-class multifamily.
These asset classes are different kinds of businesses. Now, if that operator
wants to hire a team member who has been managing apartment complexes for a
number of years, then I might feel more comfortable with this. However, I will
probably wait until they have gone full cycle on their first and second deals
before taking the plunge.

 The early communication may be indicative of their
later communication

The following happened to me two years ago during the early days of
COVID. Some time after speaking with a sponsor, I received his latest offering
in a new asset class in which I was interested. I read through the documents
and financials and was ready to invest for the first time with him. I emailed
him telling him that I wanted to invest. Two or three days went by without an
answer. I chalked it up to the weekend and emailed him again. He responded
after the second time and sent me the link to sign the virtual documents. I
asked him another question via email and he did not answer in a reasonable time
frame. It took another email to get my question answered. I signed the
documents and wired the money. I emailed him to make sure the money was
received, but it took another email for him to confirm that it was.

About two months later, I received an email that explained that since
the deal was dropped because of the uncertainty with COVID and the
quarantining, we could put the money into his latest fund instead. This was
news to me! I never got the email notice that the original deal was canceled.
Needless to say, I requested that I get my money back, and I unsubscribed from
his email list.  

When communication is subpar from a sponsor early on, then be wary that
this may be the norm for even when you are an investor. Communication is so
important in
syndication investing!  

 Ignore naysayers

Unfortunately, because of the decades-long dominance of traditional
retirement plans, most people do not understand alternative assets. Many real
estate investors, active or passive, have probably come across family members
and friends who believe they are crazy for placing their money into these
“risky” assets. The typical financial advisor will not recommend that their
clients invest in private syndications because they cannot make any commissions
from them.

There is nothing wrong with thinking differently than the masses as long
as you do your due diligence. If I had not changed my mindset and started
investing in real, tangible assets that generate steady cash flow and
appreciate in value, I would still be a frustrated, Wall Street investor
strapped into the roller coaster ride like most others. Even though my “Main
Street” investments via private syndications are passive, I feel as though I
have more control over my financial destiny. No one will care about your money
more than you.


Real asset investors must continue to educate themselves regardless of
whether or not they are just passive partners. Try not to gain too much
“experience” through trial and error because that can be costly. Not every
investment will be a double or a triple, but learn from them and make better
decisions in the future. Becoming active in a community like Left Field
Investors, or better yet, the
Infield, will help you flatten
your learning curve, compress time frames, and learn from other people’s

It would give me great
pleasure knowing that you have avoided losing money because of the lessons you
have learned from this article.

Steve Suh is an ophthalmologist and is one of the founders of Left Field Investors. After owning a few small residential rentals and seeing that it was not easily scalable, he transitioned to the world of passive investing in commercial real estate syndications. He enjoys learning and talking about real estate and hopes to educate more people about the merits of passive investing. You can contact him at steve@leftfieldinvestors.com.

Nothing on this website should be considered financial advice. Investing involves risks which you assume. It is your duty to do your own due diligence. Read all documents and agreements before signing or investing in anything. It is your duty to consult with your own legal, financial and tax advisors regarding any investment.

Chris Franckhauser

Vice President of Strategy & Growth, Advisory Partner

Chris Franckhauser, Vice President of Strategy & Growth, Advisory Partner for Left Field Investors, has been involved in real estate since 2008. He started with one single-family fix and flip, and he was hooked. He then scaled, completing five more over a brief period. While he enjoyed the journey and the financial tailwinds that came with each completed project, being an active investor with a W2 at the time, became too much to manage with a young and growing family. Seeing this was not easily scalable or sustainable long term, he searched for alternative ideas on where to invest. He explored other passive income streams but kept coming back to his two passions; real estate and time with his family. He discovered syndications after reconnecting with a former colleague and LFI Founder. He joined Left Field Investors in 2023 and has quickly immersed himself into the community and as a key member of our team.  

Chris earned a B.S. from The Ohio State University. After years in healthcare technology and medical devices, from startups to Fortune 15 companies, Chris shifted his efforts to consulting and owning a small apparel business when he is not working with LFI (Left Field Investors) or on his personal passive investments. A few years ago, Chris and his family left the cold life in Ohio for lake life in the Carolinas. Chris lives in Tega Cay, South Carolina with his wife and two kids. In his free time, he enjoys exploring all the things the Carolinas offer, from the beaches to the mountains and everywhere in between, volunteering at the school, coaching his kids’ sports teams and cheering on the Buckeyes from afar.  

Chris knows investing is a team sport. Being a strategic thinker and analytical by nature, the ability to collaborate with like-minded individuals in the Left Field Community and other communities is invaluable.  

Jim Pfeifer

President, Chief Executive Officer, Founder

Jim Pfeifer is one of the founders of Left Field Investors and the host of the Passive Investing from Left Field podcast. Left Field Investors is a group dedicated to educating and assisting like-minded investors negotiate the nuances of the passive investing landscape and world of syndications. Jim is a former financial advisor who became frustrated with the one-path-fits-all approach of the standard financial services industry. Jim now concentrates on investing in real assets that produce cash flow and is committed to sharing his knowledge with others who are interested in learning a different way to grow wealth.

Jim not only advises and helps people get started in passive real estate syndications, he also invests alongside them in small groups to allow for diversification among multiple investments and syndication sponsors. Jim believes the most important factor in a successful syndication is finding a sponsor that he knows, likes and trusts.

He has invested in over 100 passive syndications including apartments, mobile homes, self-storage, private lending and notes, ATM’s, commercial and industrial triple net leases, assisted living facilities and international coffee farms and cacao producers. Jim is constantly looking for new investment ideas that match his philosophy of real assets producing cash flow as well as looking for new sponsors with whom he can build quality, long-term relationships. Jim earned a degree in Finance & Marketing from the University of Oregon and a Master’s in Business Education from The Ohio State University. He has worked as a reinsurance underwriter, high school finance teacher, financial advisor and now works exclusively as a full-time passive investor. Jim lives in Dublin, Ohio with his wife, three kids and two dogs. In his free time, he loves to ski, play Ultimate frisbee and cheer on the Buckeyes.

Jim earned a degree in Finance & Marketing from the University of Oregon and a Master’s in Business Education from The Ohio State University. He has worked as a reinsurance underwriter, high school finance teacher, financial advisor and now works exclusively as a full-time passive investor. Jim lives in Dublin, Ohio with his wife, three kids and two dogs. In his free time, he loves to ski, play Ultimate frisbee and cheer on the Buckeyes.

Chad Ackerman

Chief Operating Officer, Founder

Chad is the Founder & Chief Operating Officer of Left Field Investors and the host of the LFI Spotlight podcast. Chad was in banking most of his career with a focus on data analytics, but in March of 2023 he left his W2 to become LFI’s second full time employee.

Chad always had a passion for real estate, so his analytics skills translated well into the deal analyzer side of the business. Through his training, education and networking Chad was able to align his passive investing to compliment his involvement with LFI while allowing him to grow his wealth and take steps towards financial freedom. He has appreciated the help he’s received from others along his journey which is why he is excited to host the LFI Spotlight podcast and share the experience of other investors and industry experts to assist those that are looking for education for their own journey.

Chad has a Bachelor’s Degree in Business with a Minor in Real Estate from the University of Cincinnati. He is working to educate his two teenagers in the passive investing world. In his spare time he likes to golf, kayak, and check out the local brewery scene.

Ryan Steig

Chief Financial Officer, Founder

Ryan Stieg started down the path of passive investing like many of us did, after he picked up a little purple book called Rich Dad, Poor Dad. The problem was that he did that in college and didn’t take action to start investing passively until many years later when that itch to invest passively crept back up.

Ryan became an accidental landlord after moving from Phoenix back to Montana in 2007, a rental he kept until 2016 when he started investing more intentionally. Since 2016, Ryan has focused (or should we say lack thereof) on all different kinds of investing, always returning to real estate and business as his mainstay. Ryan has a small portfolio of one-to-three-unit rentals across four different markets in the US. He has also invested in over fifty real estate syndication investments individually or with an investment group or tribe. Working to diversify in multiple asset classes, Ryan invests in multi-family, note funds, NNN industrial, retail, office, self-storage, online businesses, start-ups, and several other asset classes that further cement his self-diagnosis of “shiny object syndrome”.

However, with all of those reaches over the years, Ryan still believes in the long-term success and tenets of passive, cash-flow-focused investing with proven syndicators and shared knowledge in investing.

When he’s not working with LFI or on his personal passive investments, he recently opened a new Club Pilates franchise studio after an insurance career. Outside of that, he can be found with his wife watching whatever sport one of their two boys is involved in during that particular season.

Steve Suh

Chief Content Officer, Founder

Steve Suh, one of the founders of Left Field Investors and its Chief Content Officer, has been involved with real estate and alternative assets since 2005. Like many, he saw his net worth plummet during the two major stock market crashes in the early 2000s. Since then, he vowed to find other ways to invest his money. Reading Rich Dad, Poor Dad gave Steve the impetus to learn about real estate investing. He first became a landlord after purchasing his office condo. He then invested passively as a limited partner in oil and gas drilling syndications but quickly learned the importance of scrutinizing sponsors when he stopped getting returns after only a few months. Steve came back to real estate by buying a few small residential rentals. Seeing that this was not easily scalable, he searched for alternative ideas. After listening to hundreds of podcasts and attending numerous real estate investing meetings, he determined that passively investing in real estate syndications was the best avenue to get great, risk-adjusted returns. He has invested in dozens of syndications involving apartment buildings, self-storage facilities, resort properties, ATMs, Bitcoin mining funds, car washes, a coffee farm, and even a Broadway show.

When Steve is not vetting commercial real estate syndications in the evenings, he is stomping out eye diseases and improving vision during the day as an ophthalmologist. He enjoys playing in his tennis and pickleball leagues and rooting for his Buckeyes and Steelers football teams. In the past several years, he took up running and has completed three full marathons, including the New York City Marathon. He is always on a quest to find great pizza, BBQ brisket, and bourbon. He enjoys traveling with his wife and their three adult kids. They usually go on a medical mission trip once a year to southern Mexico to provide eye surgeries and glasses to the residents. Steve has enjoyed being a part of Left Field Investors to help others learn about the merits of passive, real asset investments.

Sean Donnelly

Chief Culture Officer, Founder

Sean holds a W2 job in the finance sector and began his real estate investing journey shortly after earning his MBA. Unfortunately, it could not have begun at a worse time … anyone remember 2007 … but even the recession provided worthy lessons. Sean stayed in the game continuing to find his place, progressing from flipping to owning single and multi-family rentals to now funding opportunities through syndications. While Sean is still heavily invested in the equities market and holds a small portfolio of rentals, he strongly believes passive investing is the best way to offset the cyclical nature of traditional investment vehicles as well as avoid the headaches of direct property ownership. Through consistent cash flow, long term yield and available tax benefits, the diversification offered with passive investing brings a welcomed balance to an otherwise turbulent investing scheme. What Sean likes most about the syndication space is that the investment opportunities are not “one size fits all” and the community of investors genuinely want to help.

He earned a B.S. in Finance from Iowa State University in 1995 and a MBA from Otterbein University in 2007. Sean has lived in eight states but has called Ohio home for the last 20+.  When not attending his children’s various school/sporting events, Sean can be found running, golfing, shooting or fly-fishing.

Patrick Wills

Chief Information Officer, Advisory Partner

An active real estate investor since 2017, Patrick Wills’ investing journey began like many others – after reading the “purple book” by Robert Kiyosaki. Patrick started with single family rentals, and while they performed well, he quickly realized their inability to scale efficiently while remaining passive. He discovered syndications via podcasts and local meetups and never looked back. He joined Left Field Investors in 2022 as a member and has quickly become an integral part of the team as Vice President of Technology.

An I.T. Systems Engineer by trade, he experienced the limitations of traditional Wall Street investing firsthand in his career and knew there had to be a better way to truly have financial freedom.

Unfortunately, that better way is inaccessible to those who need it most. His mission is to make alternative investments accessible to everyone who seeks to take control of their financial future and to pursue their passions in life.

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