Whitney Elkins-Hutten on how limited partners evaluate deals: look for a preferred return on early cash flows, an equity split, and a plan to return your capital fast so you can redeploy it. Operators bring expertise and deal flow but need the capital to execute.
They have the time, knowledge, expertise, the hustle, the credit and lending, the access to the markets, access to the deals, and so much so that they need additional capital in order to take all these deals down. I have the capital. I figured out ways to create that capital. That we can talk about that journey as well. And it's a win-win. I take a limited partner position and I get an ROT, a return on my time. And I do get to share in the cash flow of the deal. I look for deals that have a preferred return where I'm getting an X percentage of the first parts of the return. I also look for splits in equity. And I also look for the business plan to return my money as quickly as possible so I can continue to create velocity with my money and go into more deals at the same time.
