This story starts back in 2010 long before syndications were hot and interest rates at zero were accepted as a market norm. This three-part series will outline my journey and highlight the many assumptions that led to today’s net zero “win”.

2010s

Ghosts of GFC Past

The Great Financial Crisis (GFC) taught me a lot and allowed us to build foundational wealth as the economy began to recover. However, it also left me with several false beliefs that led to bad decision-making many years later. The false conclusions are understandable, but what is most surprising (and scary) to me in hindsight is that these were mistakes made by two MBAs who regularly read investment circulars. We are not CFPs (and have perhaps foolishly never consulted one), but it seems we knew just enough to be dangerous. Know thyself.

False Belief #1:

It is not possible to fund a comfortable retirement by utilizing retirement plans. Investors must utilize alternative wealth-building vehicles.

After my daughter was born in 2010 and I was not working, I spent a lot of time observing how other people had gained wealth and attained a comfortable retirement - especially immediately after a recession. I saw two options: 1) a pension (which no longer exists), or 2) own a successful business or real estate. I did not observe any retirees living off of their retirement accounts. So, I made the logical, but flawed, conclusion that retirement accounts alone are not a realistic path to retirement.

⛔ False Assumption: Retirement accounts have been widely available since like forever.

✅ Reality: 401(k) and IRA programs were not widely used until the early 1980s.

The reason I did not see any retirements funded by retirement plans in 2010, was because it would have been mathematically impossible; the availability, limited contribution amounts, and short timeline would not have made this possible by 2010.

👉🏽 The Truth: Retirement accounts can work.

A person with a good income and strong saving and investing habits can absolutely fund retirement using main-stream retirement accounts. Can you retire early? Probably not. Will you be “wealthy”? Also, probably no. Financially secure? Probably yes.

False Belief #2:

Investing in stocks does not build wealth.

After experiencing the “Lost Decade” of net zero returns for US stocks from 2000-2009, it was logical, and - again - incorrect, to make the conclusion that the seemingly linear return assumption of a compounding 8% used by brokerages was fundamentally broken.

⛔ False Assumption: A well-crafted retirement account is composed strictly of US stocks.

✅ Reality: Modern Portfolio Theory is based on diversification well beyond US stocks.

While Modern Portfolio Theory (MPT) has existed in academics since the 1950s, it was not broadly accepted and applied to personal investing until the 1990s. Before that time, the approach was similar to my false belief that prevailing retirement strategy is limited to investing in US stocks and is thus subject to wild fluctuations in returns.

👉🏽 The Truth: MPT works.

Even during the Lost Decade an investment using MPT would have provided a net positive return. The data strongly supports the validity of MPT.

The fall-out: Heavy allocations outside of the traditional index funds.

On the plus side, we purchased our own rentals, and employed robo-advisors like Schwab’s Intelligent Portfolio - both of which have served us very well in building wealth.

On the con side, we purchased a lot of syndicated investments, most of which have not provided the anticipated financial benefits, but have provided a rich environment for life lessons.

The next part of the story will cover the missteps of 2019 - 2024: the critical period of deploying capital and how you can avoid taking your own path to Net Zero.

Don’t miss Part I of this series.

Read Part 1

2019-2020

The syndication journey begins

For many years I suspended my real estate investing since purchasing and renovating properties remotely was not complementary to raising our young daughter. However, syndicated real estate investments offered an alternative. I immersed myself in the topic.

I did the work - I read the books, consulted my CPA, had extensive discussions with GPs. I made spreadsheets that projected returns and failure rates based on available data. I made a truly concerted effort to underwrite what I was getting into with the same level of scrutiny and skepticism that I applied to purchasing my own rental properties. But it wasn’t enough.

⛔ False Assumption: Reading everything available is sufficient.

Investor education resources were relatively limited at the time. I spent months intensively educating myself and felt that I was making well-informed decisions. But despite my best efforts my knowledge was severely lacking.

✅ Reality: You will never know everything.

Today, far more and higher quality information is available. But most is created by those selling the product, so it is rare to find the depth of analysis that is required to truly understand what you are investing in. Listen to any expert GP recount the myriad of information they review - and the infinite number of ways things can go wrong - and it should quickly become apparent that an LP is no expert.

2021

We start investing funds

Our life was in a period of intense transition, which demanded my full attention. I knew that the level of due diligence required to assess the quality of a deal required far more time than I had available. So, I outsourced the decision-making. At the time, CrowdStreet offered PMA (Privately Managed Account) services. I spent months getting to know our account manager - understanding his philosophy and creating a strategic portfolio investment plan. I fully understood the fees and was comfortable with handing the reins to a team of experts I perceived as having far more experience and knowledge than I ever could. The plan was made, and funds were transferred for investment.

⛔ False Assumption: Advisors and GPs’ interests are aligned with your interests.

I vetted and trusted my advisor and the GPs. I assumed others’ definition of risk was the same as mine. I assumed that the glossy real estate teams handling multi-million dollar deals were rigorously analyzing the data.

✅ Reality: No one knows and cares about you like you do.

No one lied or deceived me (actually there are one or two but that’s another story). I gave GPs’ and advisors’ opinions and information far too much weight. I assumed they were operating from a place of objectivity. I failed to consistently and continuously look after my best interests.

2022

We do a cash-out re-fi on the rentals and invest more funds

After deploying SDIRA funds, we doubled down and completed a cash-out re-fi on our rental portfolio to access the equity that was lazing around. Which went to CrowdStreet’s PMA for investment.

The strategy was sound: monetize equity and put it to work. Due to favorable lending terms, the cash flow after the re-fi was marginally less than before the re-fi.

⛔ False Assumption: Diversification is always beneficial.

Monetizing equity wasn’t just about maximizing total returns, but diversifying our portfolio. Having a large amount of our net worth tied up in a few properties in one city seemed foolish compared to diversifying across numerous assets and geographies. I assumed diversifying was a superior strategy.

✅ Reality: Not all investments are created equal.

My perceived risk of syndicated real estate was identical to that of equities or our own investment real estate. This is most definitely NOT the reality. Besides asset risk, I also overlooked vintage risk.

2022 - 2024

Asleep at the wheel

As life sped up and funds were invested, the quarterly reports came and went unread and we remained blissfully ignorant to what we owned and what was happening. A few deals exited and provided generous returns. All was going so well.

Then the distributions stopped, the capital calls came, and the performance reports went from “on-track” to the alarmingly frequent use of “distressed”.

⛔ False Assumption: Change of key management is not a concern.

When our account manager at CrowdStreet disappeared, a new team and structure was implemented. I didn’t think twice about it. I assumed it was for the best and that the new team was on board with our plan.

✅ Reality: Change in key staff is a big, giant, enormous warning sign that must be heeded.

All those months vetting and discussing were lost with the account manager. In reality, I had no idea who was now selecting deals for us and what their decision-making was based on.

When I finally took the time in 2025 to review the initial offerings, a large majority of deals had red flags all over them. I had the skills but not the time to choose wisely. Making a good investment requires both, not one.

⛔ False Assumption: There is no need to monitor passive investments.

I thought “The money is invested. What’s the point of reading all these quarterly reports?”

✅ Reality: Warning signs are apparent to those who care to see them.

If I had been reading the reports, I would have started to see all the ways deals can go wrong and the market distress signs sooner. Perhaps that coupled with the loss of our account manager would have caused me to question the wisdom of continuing. But no, I was driving blind and headed for the cliff.

⛔ False Assumption: The case for a capital call is financially sound.

I assumed the GP wanted what we wanted - to make money. That is, of course, true but the means to the end are different for GPs and LPs. I assumed the picture painted by a GP in a capital call was a comprehensive and fiscally-sound plan.

✅ Reality: A capital call requires due diligence like any investment.

Most of the capital calls we made were based on very little understanding of the underlying issues and how realistic the revised business plan was of succeeding. By the time I started doing meaningful analysis in 2025, the pure lunacy of most of these plans was blatantly apparent to me.

Coming next…

We’ve driven off a cliff and the ground is coming up fast.

Next time I’ll discuss how I dug through the car wreck of our portfolio, and lived to tell about it.

Click to read Part III.

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Don’t miss Parts I and II of this series.

Part I

Part II

2025

Time to face reality

As I became increasingly aware of the alarming level of distress within our portfolio I resolved to stare down the cold, hard reality of a mesmerizing amount of data. Starting with the pitch deck all the way through the most recent quarterly report. It wasn’t fun. It wasn’t easy. It was downright tedious, unpleasant work. But I was determined to find the truth, and learn from my mistakes.

Fortunately, a number of resources helped me get through it.

Peer Investor Groups

Finding and interacting with others via online investor groups provided the peer feedback and insights I wish I had back in 2020. I learned new ways of looking at deals, and received invaluable insights.

👉🏽 Lesson Learned:

No one knows it all. Actively seek out thought leaders and ask questions.

AI

I initially reviewed materials manually. Yep - I ate the elephant bite by bite. Including the PPM and OM. Ugh.

After I learned how to effectively use ChatGPT to summarize and analyze reports, the work sped up exponentially. Completing a comprehensive review of a single deal using ChatGPT took between 2.5 to 4 hours. In total, the process to review 35 deals took about 6 weeks of consistent daily deal review.

I have now shifted to NotebookLM for analysis, which provides more reliably accurate results.

👉🏽 Lesson Learned:

Completing quality analysis takes a tremendous amount of time and energy; AI can be your secret weapon.

Read how I’m using AI here 👇🏽

AI Posts

2026

Moving past failure

What did spending hundreds of hours doing deal analysis get me?

1) A visit from SARAH

If you have experienced difficult times, you may also be acquainted with SARAH. She starts as Shock, then transitions to Anger, Resistance, Acceptance, and finally Healing. This may include intense emotional distress including shame, regret, and remorse. Sleepless nights, crying, and marital strife. But despite all this, taking a trip with Sarah will bring you to Healing - a better result than the more popular but ultimately useless trip down the river “Denial”.

2) Clarity

This series is the product of my time with SARAH. None of this writing came without intense work and reflection. Nor the processes I now use to monitor our investments. I can’t predict the future, but I have made sense of the past. And I now have the tools and resources to continue learning so I can make better decisions.

3) Empowerment

Radical self-responsibility is the most difficult but powerful position a person can take. By recognizing and accepting that we are 100% accountable for our life, the world (counter-intuitively) becomes less scary and unpredictable since the only variable is yourself. A variable fully under your control. You are empowered to pursue your success - regardless of the challenges along the way.

What this looks like in practice:

🚫 Victim narrative (“them” statement)

The Fed ruined my investment by shocking everyone with higher interest rates. The Fed sucks.

✅ Empowered narrative (“I” statement)

I failed to understand interest rate risk and how that could affect my investment. I now know how to better assess risk.

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The Next Chapter

The journey doesn't end here. The Path to Net Zero covers deal analysis, AI tools for investors, and resources to help you avoid the path to Net Zero.

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