Why do syndicates so often not work?

I was involved in two syndicates in the UK, before I fled to foreign lands and both those experiences were great. However I did see one that really didn’t work, but I wasn’t involved in that.

Statistically, my experiences are far too few to draw meaningful conclusions… Although, what struck me was that on the two successful syndicates that I was involved in they were all people of similar earning potential and the original members purchased the aircraft as a group. They both had an informal feel and we met up to discuss the finances a few times a year and over a beer. The neighbouring syndicate, the bad one, had a militaristic feel to compulsory formal monthly meetings and there was a wide difference between earning potentials and flying aims. Arguements and disagreements were heard in the airfield bar about avionics fits and who would pay, for example… Also in that case one individual, the militaristic one, used to own the plane and sold off shares to form the group.

Therefore from my experience I would say that there are very successful shares, but it does depend on the collection of people around it.

Our plane is run in a two person syndicate and since we went through an engine overhaul without and personal troubles I think it works very well. But the most important thing is that you need a similar attitude on how the plane is operated, maintained, on which upgrades should be done etc. For example mixed IFR/VFR syndicates tend to cause trouble… I was member of such a group before and it was ok but things are much more complicated if some members just want cheap flying while the others would like a full IFR aircraft.

I may have been lucky but as a member of three sydicates I have found that they all work well for me and the other members as well. Each one feels like a small, in one case three members, fairly exclusive club. We have a set of rules that all are expected to abide by, new members are by invation, we have a chairman, treasurer and a maintenace lead these are elected at the only formal meeting of the year. This is normaly held in an airfield hut in winter, it cuts the ammount of waffle wonderfully. The aircraft are two seaters and we often share flights, typicaly flipping a coin to see who flies out and who has the return flight and use of the aircraft is agreed by phone. When more than two want the aircraft for a day/ weekend we just come to an agreement which typically means shorter flights and everybody flying but sometimes the heavest users defere to those less fortunate with time.

I know it sounds a bit of a loose arrangment but it has worked well for nearly twenty years

Why three? well they are all different to fly and it prevents me from getting “type bound” and I like swapping around a bit, also it still costs no more than a sole ownership, maybe slightly less

Syndicates have worked out for me so far. What else are you going to do when you want one touring aircraft, one float plane, and an aerobatic mount (and someday maybe a helicopter)?

That aside, one of the things that helped my flying the most was buying a share in a simple airplane (basic PA28 or such) immediately after my PPL. This allowed me to meet lots of people, some of whom later became great friends and co-owners of other airplanes. It also allowed me to fly a lot in an inexpensive manner and build experience to become a better pilot, and to learn about how it all really works, i.e., maintenance, longer flights, being stranded due to weather :-). These are all of the things that you learn ‘after’ you get your license. Initially, I was concerned about the size of the group and the availability of the aircraft, but these concerns later proved to be unfounded. Invariably, in every group there are a number of pilots who don’t fly much, so the airplane is usually available. I have yet to see an airplane that has been flown ‘too much’!!! Also, with simple airplanes it is unlikely that there will be any big disagreements over the kit installed, i.e. you are not going to upgrade the panel substantially.

As others have mentioned, there are some concerns that can cause problems, and I think that these increase as the cost and specification of an aircraft increase. For example the IFR and VFR group splits or disagreements on spending money for major upgrades. The most successful syndicates for these type of aircraft seem to be when a smaller number of co-owners buy into an aircraft, after it has already been upgraded. This ensures that everyone is ‘buying in’ to the same standard, and is on the same page. Also, for more expensive, or more advanced aircraft, I think that it is very important to ensure that the group has the same outlook on maintenance, and the financial ability to pay for the expected costs. It is awkward if you want to fix or upgrade something, and know that it may strain any of the group members.

Although it may prove to be unnecessary, it is also useful to have some sort of document that everyone has signed, dealing with what will happen if something bad occurs. For example, it may detail what each member’s liability is in the event of an ‘incident’, or what happens if a group member stops paying, etc.

All told, I highly recommend syndicates with like minded people (friends?), and hope to continue being a part of them for a long time to come! That being said, if you have the cash, and know exactly what you want, i.e. one specific plane, then sole ownership may be the way to go.

So the thing I’d like to know is how best to assemble a syndicate from nothing (rather than join an existing one). How would one choose the partners?

I tried this in 2001 and totally failed.

Today with everything done over the internet it shouldn’t be such a big problem to get the right people together. What I think is really important is to have clear guidelines before looking for partners so that everyone knows what he will be joining. The other way round “let’s first get a few people together and then decide what we will do” is doomed right from the start.

While I’ve never been in a syndicate, I think italianjohn’s observations are valid:
- similar earning potential
- similar mission profile

I think the first is even more important than the second and needs a realistic assessment. We all want to fly more capable airplanes, so I guess the desire to ‘go above your station’ (to use a very British expression) is always there. It’s a bit like packing a suitcase – put everything in you want to take and then chuck half of it out again. You then have what you need.

How one finds these people is another matter altogether, and I’m not sure the internet is much help here, as it allows a lot of deception (and delusion!).

I’m a member of (what I believe is) the largest syndicate in The Netherlands: The Diamond Flyers
There are 4 DA40s, 2 DA20s and 1 Super Dimona placed in multiple foundations.
The syndicate focusses on making flying as affordable as possible.

The syndicate also offers flight training, so most people learn to fly on the aircraft in which they have a share in.
There is one full time instructor, and several parttime instructors. The instructors are all shareholders in one of the syndicate aircraft.

The concept has been started a couple of years ago by a retired guy who runs it in a non-democratic way.
He is the chairman of all the foundations. Shareholders have very few involvement in the goings of the syndicate.
There are no membership meetings, there is no bar, etc. Joining pilots are subject to some “screening” process; the syndicate has the right to deny joining pilots.

The concept is working well, all hassles (like maintenance, paper work, etc etc) is taken care off.
The booking system allows to share your flight, so participating pilots can join.

I am in syndicates from the beginning on, now with my 3rd a/c, thus the 3rd syndicate. What is different in my case is that this is a fully managed syndicate, means we have a professionally managed company (Ltd.) that organizes mostly everything for us but flying itself, i.e. buying the a/c from the manufacturer with the best discounts available since they buy several a/c per year, bringing together the right people for the a/c, organizing all the maintenance, all the legal stuff, our a/c is even pulled out of the hangar for us prior to departure. So we only have to jump in the a/c and manage the flight itself – extremely comfortable, even though I understand the purists finding this approach horrible. I wouldn’t change a thing.

The advantage is first that the a/c is extremely well managed in everything; second we have pilots with a different mission profile: I prefer flying on business trips during the week with (extended) weekend-trips being only of a limited interest for me, let’s say approx. 6 times a year; other pilot is mostly a weekend-pilot, that fits perfectly of course. Additionally, the a/c is not privately owned but is owned by a company with the pilots being more or less shareholders renting the a/c back which grants certain tax advantages as well. Finally, with that kind of a managed syndicate the intra-group liability is limited, too, which is pretty well in the worst case scenarios.

So to make a long story short: modern a/c, professionally managed, it can’t be better for me.