LP Investing Digest #45
LP Investing Digest #45
Tweets on investing, and anything else helpful to LPs
Last premium post: LP Investing Lessons Podcast #7
Last free post: LP Investing Digest #43 & Full Article Index
Announcements:
LP Cohort: One more spot in the September cohort. Please reply to this email if it’s of interest. Review 4 deals with me (4 consecutive weeks) and other LPs to learn what to look out for in deals.
I started this newsletter exactly 1 year ago yesterday, so I just wanted to say thank you - it has been a wild journey and I am extremely thankful for all of your notes, feedback, and support.
Here’s what the subscriber growth has looked like on the backend starting at August 29, 2023:
Distressed rates by region - interesting to not see Phoenix here (while Tucson, AZ is). I reached out to Michael and it turns out that Phoenix ranked 53rd at 2.3%. Methodology/report here.
This is an older post that I was reminded of when someone reached out to me this week saying their GP is filing for bankruptcy - key man risk is a real thing. See #24 in 26 questions to ask your GP
Supply and demand… in three charts. Similar concept applies to renovations - just because you renovated, doesn’t mean they’ll come
I’ve seen this personally, particularly in Class B-/C multifamily properties (important to remember for lease renewals as well, or planned upgrades such as cable, water filters, etc.)
You cannot compare VC (or crypto) returns to real estate returns - risk profiles are different, assuming you understand the downside of the real estate you’re investing in. I address this concept with detailed numbers and datatables extensively here
A really important reminder … sometimes all you have to do is ask (otherwise you won’t get it!)
Two interesting discussions on IRR. Read my thoughts on this at Filtering based on IRR and CoC is dangerous
Have a wonderful weekend!
Thank you for reading! I genuinely hope you found this helpful - the best way to say thank you is to spread the word.
I advise LPs on existing and potential positions and write articles here weekly on what I see in the marketplace that could help you invest better. You can find me on LinkedIn or Twitter.
Whether you’re an LP, want to learn to become one, or affiliated with LPs (GPs, Attorneys, CPAs, Wealth Advisors) I hope you’ll consider subscribing and sharing this post to help others make more informed investment decisions.
When you’re ready, I could help you in 3 ways - simply reply to this email if one is of interest:
Limited Partners:
Potential positions - you’re considering investing and need an independent opinion
Existing positions - there’s a lack of communication, you’re concerned about fraud, or perhaps you got a capital call request and you’re not sure how to proceed. I have also helped LPs with a “post-mortem” analysis on deals that didn’t work out - it’s important to learn these lessons as opposed to just blaming the GP.
LP Cohort - review 4 separate memos together with me and other LPs to learn how to vet LP investments.
LP Topics Seminar - an ongoing biweekly 1 hour meeting with other LPs where we'll go over investment decks, capital calls, distressed situations, and modeling. This is meant to provide a deeper look into existing LP investments. Please reply to this email if you’re interested.
LP Investing Lessons Podcast - learn from others investing lessons here. if you're an LP with lessons learned from a successful or unsuccessful investment, consider replying to this email to share your knowledge with others. Both the LP and GP in the recording are kept anonymous.
LP Community - join my free 2,500+ member LP community on Twitter
Find GPs in unique asset classes/geographies on my monthly Twitter intro post (see LinkedIn’s post as well for more)
General Partners:
Deck review - I’ll look over your marketing materials from the perspective of an LP and provide slide by slide commentary to improve your pitch
Investment review - I’ll provide independent feedback on an opportunity you’re pursuing
Capital call advisory - you suspect that you’ll need to make a capital call, but aren’t sure how to proceed or communicate the message.
Other - anything from waterfall/fee advisory to disagreements between co-GPs on the proper path given a set of circumstances
General Consulting: modeling, strategic advisory, underwriting training, etc.
If you’d like to speak on the phone, you can reach out to me any time at aleksey@hey.com