What is SBREfunds.com?

 
Matt Burk
February 10, 2015
Photo of Mountain Trail

Why did we launch SBREfunds.com?

In late 2011 when my partner Lance Pederson and I conceived of our current business model to assist other small balance real estate (SBRE) dealmakers in architecting, creating, launching and administering their own pooled investment funds. Little did we know how overwhelming the demand for this expertise was going to be. We knew from years of running our own funds that there are an unlimited number of issues and complexities that go along with starting and operating such funds, each facet influencing and affecting every other. But the sheer number of people in this country who are considering, have considered, have already started, are in the middle of, and/or are at some level on the spectrum of running a pooled investment fund and are searching for answers along the way has been truly overwhelming. This is what ultimately led us to launch SBREfunds.com.

What is SBREfunds.com?

SBREfunds.com has been the product of thousands of conversations with real estate asset based dealmakers all over the U.S. – private lenders, note buyers, fix and flippers, rehabbers, value add and opportunistic real estate buyers, tax lien certificate investors, and others – over the past three years. Those many conversations are remarkably similar and repetitive as dealmakers face fundamentally the same challenges from one location to the next, one strategy to the next, one situation to the next. They all need to raise capital to do whatever deals they are doing, they need to do it consistently, and doing it one-deal-at-a-time gets old after a while. But making the leap to the pooled investment fund is not a simple process. If you have not done it, you simply don’t know what you don’t know…and there is A LOT to know that a person does not anticipate, understand, or appreciate until he or she has traveled the path.

This, more than any other factor, is what has resonated so strongly with so many of our clients – the fact that we have traveled the path (and in fact continue to travel it to this day) and that we therefore have a soldier’s appreciation for what it is like to be in the trenches on the front lines. What we teach and share with others is not ivory tower legal theory or Wall Street philosophy that does not contain direct application to the dilemma that SBRE entrepreneurs face every day. It is real world know-how and practical guidance that comes from being in the fray for years and having experienced firsthand how all the moving parts continually morph, evolve, and impact one another. This experience and expertise is what we will now focus on bringing to you as a member at SBREfunds.com.

We came to a critical realization years ago, which is that the high net worth, accredited investor is simply the best source of capital for SBRE pooled investment funds. This is not to say you cannot get bank lines, managed accounts, or, in rare cases, institutional money. It is just to say that statistically an overwhelmingly large percentage of the capital for these funds comes from this source. Therefore, a wise manager accepts this fact and focuses his efforts upon this group. Well, up until September of 2013, one was limited in doing so to people with whom he had a “prior business relationship” and he could not legally advertise or solicit people he did not already know. This was a fundamentally limiting legal constraint that served to keep these pooled investment funds in the shadows for a long, long time. That all changed with the passage of the JOBS Act. This was a watershed event for people who are operating, or want to operate, an SBRE pooled investment fund.

Growing a SBRE community

This confluence of events (our evolving business model, the impossibility of answering everyone’s many questions about pooled investment funds one on one given time constraints, the recognition and acceptance that high net worth accredited investors are the primary and best source of capital, and the passage of the JOBS Act) was the genesis of our creation of SBREfunds.com, which is really more than just a website, it truly is a community of people on both sides of the equation – managers and investors – who stand to benefit greatly from working with each other.

We wanted to create this community based on core values of professionalism, transparency, trust, competence and abundance, and in so doing provide a place where people in the SBRE industry who are committed to learning, growth, improvement, and best practices can go to get resources, tools, education, and ultimately greater exposure to the high net worth accredited investors who are the single best source of capital for such managers.

And for investors, we want to help them better understand the true nature of pooled investment funds, their strengths and weaknesses, the great variety of strategies available, and to increase awareness and choice of these fund opportunities that exist all over the country. By promoting and living the values we espouse and doing our best to attract and foster a community of SBRE entrepreneurs who are also committed to them, we believe SBREfunds.com will become the most trusted resource available anywhere for accredited investors who want to take advantage of all that these SBRE funds have to offer and at the same time, increase their chances of limiting downside risk.

SBREfunds.com: A solution to address all inquiries

For us, it has become an absolute necessity to create a members only program, simply for time management sake. We have become literally inundated with daily phone calls and emails from people looking for information and asking questions about pooled investment funds. We have freely given away our knowledge and expertise in blogs, webinars, live events, and one on one, in countless phone conversations over the past 36 months.

We have reached the point where it is impossible for us to do this any longer as it not efficient, practical, or profitable to do so. So we conceived of and created SBREfunds.com to solve this problem for ourselves and the many people who stand to benefit from the information. By charging a nominal monthly subscription fee to CapitalFlow members, we are able to aggregate the questions, issues and concerns (which again are very similar and very common from one SBRE entrepreneur to the next) and to provide answers, guidance and direction to far more people more efficiently. And by offering legitimate, non-SBRE entrepreneur investors a free DealFlow membership, we are able to accumulate a large pool of genuine investors who are truly interested in learning more about this fascinating space while gaining access to fund opportunities they would never have seen or heard of in the absence of such a website.

Building a great community on both sides of the aisle

And just so we are clear about our M.O., we are 100% committed to maintaining the integrity of our DealFlow membership. We have already had numerous SBRE dealmakers, fund managers, or aspiring fund managers try to enter the community for free by posing as investors. We are not going to allow this to happen. In case you haven’t noticed, it is very easy these days to research someone on the internet and figure out pretty quickly what their professional story is. Unless you are prepared to erase your existing digital footprint (not easily done) to prevent us from discovering who you are in order to save $99 per month, please just skip the games, and sign up for the appropriate membership.

Although it requires time and effort on our part to do it, we believe that building and maintaining a true database of high net worth, accredited investors who come to the site not to try to plagiarize or steal other people’s offering documents, but rather for genuine education, helpful information, and access to opportunities will be highly beneficial to our paying members. We want investors to feel welcome and comfortable that the site is designed to educate, inform, and provide choices, rather than feel pressure to do something they do not want to do. This is critical to building a great community on both sides of the aisle.

Join us in building the world’s largest community of SBRE entrepreneurs and investors

Finally, we are now reserving the deep, rich and meaningful content, experience share, and expertise for our members only. We will still provide general information to non-members and we want to encourage membership participation by giving away snippets of information, but the blogs, webinars, online courses, one on one discussions, advisory services, and fund expertise will be provided systematically to our valuable CapitalFlow (SBRE entrepreneur) and DealFlow (accredited investors) members who want to be part of the community we are building. We are grateful for your support and we want to bring the maximum possible value to as many people as we can. SBREfunds.com provides a framework which allows us to do that more effectively and bring even more value across a broader spectrum of the fund universe than we could possibly do in the absence of it.

We hope you will join us in building the world’s largest community of SBRE entrepreneurs and investors. You will not be disappointed.

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Photo of Matt BurkMatt Burk is founder and CEO of Fairway America, LLC, and SBREfunds.com, and Chief Investment Officer of Fairway’s two proprietary nationwide small balance real estate (SBRE) asset based pooled investment funds, Fairway America Fund VI, LLC, and Fairway America Fund VII LP. Fairway is the nation’s premier consulting, advisory, and investment firm in the SBRE private pooled investment fund space, providing a full spectrum of practical, real world products and services (including capital) needed for true success for SBRE entrepreneurs all over the U.S. Matt is a highly regarded adviser, consultant, and mentor to dozens of SBRE fund managers and author of a widely read blog followed by serious SBRE entrepreneurs and investors. For over 20 years, Matt has led Fairway’s deal underwriting as well as capital raising efforts in Fairway’s seven proprietary funds and individual trust deed investments, resulting in more than $250,000,000 in capital raised from accredited investors through more than 1,000 SBRE deals. He is currently working on multiple SBRE fund consulting engagements nationwide, authoring a book on how to raise capital for and effectively manage pooled investment funds, and dedicating his efforts to create greater awareness and drive more capital to the many high caliber and deserving SBRE entrepreneurs around the U.S.