Twelve one page updates, and the same three people funded deal four with no call

The same day every month is the part I'd steal. What day did you pick and does it matter? I'd guess the answer is that it only matters that it doesn't move.

I'm four deals in with two investors and I've hit the same ceiling from the other direction. Three people funding 240k is great until deal six needs 600k and one of them has a kid starting college. Did you add anyone new in those two years or is it still the same three? Because the update discipline solves retention and it doesn't solve the size of the room.

As one of the people on the receiving end of updates like yours: the month six email where you said the close date moved and you didn't know the new one is worth more than the other eleven combined. Every sponsor sends good news. The tell is what arrives when the news is bad and unfinished.

One thing I'd want if I were in your deal. Did the monthly show accrued pref as a running balance? Plenty of operators report spend and never show the LP what they're owed to date, and then the payoff arithmetic is a surprise to everybody.

The economics of what happened are worth being explicit about, because the re-up is the whole point. Your first raise cost you an attorney bill, three separate conversations, and twelve months of writing. Your fourth raise cost you one email. Repeat capital is cheaper because the diligence has already happened, and the diligence in your case was twelve pages of you being consistent when the deal ran four months long.

The arithmetic on deal one: 8% on 145k is 11,600 a year, so 8,700 over nine months is right, and every extra month of delay was costing you roughly 970 of your own split. That is the real price of the overrun, and it is also why the transparency mattered. An investor who watched the pref accrue in your monthly already understands why your number came in low.

The assumption this all rests on is that three people can keep covering the equity. At 240k across three, each of them is carrying 80k average in a single illiquid flip, and your 40k investor going to 90k means his concentration more than doubled. That is his call to make, and it is also the thing that breaks first if a deal goes sideways.

One more. Everything you described happened with people you already knew, which is a different situation from advertising a deal to strangers. Which exemption you rely on, who is allowed to invest, and what you can say publicly are governed by securities regulation and vary with how the offering is structured, so confirm the specifics in writing with a securities attorney before you widen the circle.

11k over on the roof. From the build side that's a normal miss and I'd want to know whether your monthly showed a contingency line that was getting eaten, or whether the 11k just appeared. Investors handle a shrinking contingency much better than they handle a surprise, because the shrinking one they watched happen.

Saving this. My first rental is closing with my own money so none of this applies yet, but the one page format is going in a folder.

What actually goes on the page? Money in, money spent, money remaining, projected close, and then a few lines. Is it a spreadsheet screenshot or did you type it out? I ask because I'd overbuild it and then stop sending it in month three.

Nine months on a five month flip and they still gave you 240k. That says more about the three people than the updates, honestly. I've had a deal run long and the investor who was fine with it was fine with it because he had liquidity elsewhere. Would the fourth email have worked if deal one had lost money and you'd reported that clearly every month? That's the test and most of us never get to run it.

flint, I think that's the right question but I'd guess the answer is yes for a small loss and no for a wipeout. quarry, did any of the three ask for anything in writing beyond the operating agreement? Information rights, a right to see the bank statements, anything like that?

The attorney at 4,100 is the number that jumped out at me. I've had two customers ask about putting money into a job and my whole hesitation is that I don't know what the paperwork costs before I know if anyone will actually wire. Did you get the docs drafted before or after they said yes?

Sorry for the basic one. What does preferred return mean here exactly? I read it as the investors get 8% a year before you get anything, and it keeps adding up if the deal runs long, so a slow deal costs the operator rather than the investor. Tell me if that is how it actually works in practice.

juniper, that's how quarry described it, and the piece that made it click for me is that the pref accrued rather than being paid monthly. So it just sat there growing until the sale.

quarry, the thing I'd want to know as someone with zero deals: what did you say in that first conversation two years ago, when you had nothing to show and were asking for 145k? The fourth email is easy to picture. The first one isn't.