\n<\/p>\n
Most new investors don\u2019t know how to find private money<\/strong><\/a> for real estate<\/strong>. They think private money is only reserved for those with a Rolodex full of rich or well-off business people, investors, or relatives. Using this line of thinking, most real estate investors will simply buy a deal, save up for years, and do it again. If you want to get on the fast track to a respectable real estate portfolio<\/strong>\u2014private money is the way to go.<\/p>\n But you don\u2019t have to take our word for it. Amy Mahjoory<\/strong>, private money expert, is back on part two of her financing and funding masterclass. Amy has grown her <\/strong>real estate portfolio<\/strong><\/a> quickly<\/strong>, thanks to private money. On just her second deal she was able to pay for a significant portion of the property using her private lender. Now, she urges investors, no matter their experience level, to do the same.<\/p>\n This time, Amy walks through five strategies that any investor can use to connect with private money lenders<\/strong> today. These strategies are simple\u2014so simple that almost anyone can use them and find success quickly. They don\u2019t require lots of money, time, or experience, but you need to be aware of them next time you\u2019re in a perfect situation to make your pitch<\/strong>. Try these five strategies today, and you may see your inbox flooded with private money offers!<\/p>\n David: Amy: David: Rob: David: Rob: David: Rob: David: Rob: David: Rob: David: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: David: Amy: David: Amy: David: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: David: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: Amy: Rob: David: Rob: David: \u00a0<\/p>\n<\/div>\n Help us reach new listeners on iTunes by leaving us a rating and review! It takes just 30 seconds and instructions can be found here<\/a>. Thanks! We really appreciate it!<\/p>\n Interested in learning more about today\u2019s sponsors or becoming a BiggerPockets partner yourself? Check out our\u00a0<\/em>sponsor page<\/em><\/a>!<\/em><\/p>\n
This is the BiggerPockets Podcast Show 637.<\/p>\n
So there are a lot of that investors out there who may be thinking, \u201cWhy do I need to learn how to raise capital? I don\u2019t want to flip. I don\u2019t want to wholesale. I don\u2019t want to even implement the Burst strategy. I want to go by turnkey rental properties. I want to go invest in a commercial syndication. I want to go start a fund.\u201d Okay, fine. You still need to know how to raise capital to do all those things, right? So we\u2019ve all heard cash is king. It is endless opportunities when you know how to raise capital. You\u2019re going to start getting approached like I did from people out there who want you to be their capital partner and compensate you very well to raise money for their business.<\/p>\n
What\u2019s going on everyone? This is David Greene, your host of the BiggerPockets Real Estate Podcast here today with my amazing co-host Rob, Roberto, Abasolo. Rob, how are you today?<\/p>\n
Good, man. I am still recovering from our two-hour conversation on the phone the other night where I biked the entire time. My legs have been like jello ever since.<\/p>\n
Bro, I got to compliment you. You were on a bike the whole time and I didn\u2019t know it, meaning you never actually got out of breath, which would lead me to believe you might not be a human being, which would actually explain your amazing hair all at the same time, like if we were on the phone for two hours, which is quite the feat as it is. But you were on a bike the entire time and I didn\u2019t know.<\/p>\n
Well, it helps that you were just doing one, two hour metaphor the whole time. I don\u2019t know if you remember this. I never actually said anything on that call so that\u2019s probably why.<\/p>\n
It was a two-hour monologue where you were just forced to listen, just like the Seeing Greene episodes that I make you show up and listen to me and praise me without actually allowing you to speak.<\/p>\n
Oh, now that\u2019s what we call a callback. And a good one, a good one at that.<\/p>\n
All right. In today\u2019s episode, Rob and I continue our conversation with Amy Mahjoory about raising money to invest in your real estate deals. In the last episode we just did with Amy, she explained her framework and how to build a foundation with people, including an elevator pitch that you can use. I believe hers was 14 words and made a lot of sense. And today we get deeper into how to put yourself in positions to use that information. Rob, what was some of your favorite parts of today\u2019s show?<\/p>\n
Yeah, I think we\u2019re really just breaking down barriers here. Honestly, it\u2019s very simple. Because when we started in the last episode, she talks about, it was actually 13 words, 13 very specific words with a 20 word follow up. And then today\u2019s episode, we actually talk about how to go from follow up to actually taking action in five very tangible steps you can take today to go out and raise millions and millions of dollars if you do it correctly. This ranges everywhere from basically putting yourself out there online, to hosting local meetups. I don\u2019t want to give too much of the good stuff away because, yeah, some of these I don\u2019t think some of you will be expecting.<\/p>\n
Yeah. And this is a great show because we get it to tactical advice. This isn\u2019t just the overall, \u201cYeah, put yourself out there. Yeah, go to a meetup.\u201d Nope. This is exactly what type of events to look for, how you should dress when you go, what you should say and how to cater it to your individual personality. So if you\u2019re someone who\u2019s serious about wanting to raise money and invest in real estate, this is a must listen episode. So please listen all the way to the end because we keep it rolling all throughout.
Before we bring in Amy, I\u2019ve got a quick tip for you today. Go to biggerpockets.com\/reshow. That is the podcast page where you can find out about the other BiggerPockets Podcast, but even more importantly, there\u2019s free stuff. So if you go to biggerpockets.com\/reshow, you\u2019ll find some free information for you, a masterclass from Brandon Turner himself about building a brand. We\u2019re working on getting him to do one about building a beard, but for now we have the Brand class, as well as some free stuff that Amy has given that will supplement your journey into raising private money. Rob, anything you want to say before bringing Amy?<\/p>\n
No, I\u2019ve got nothing to say. Let\u2019s get into the episode. Leave me alone. Don\u2019t laugh at me. I\u2019ll laugh at you.<\/p>\n
All right, Rob smooth as a jagged knife, Abasolo rolling into the show.
Amy Mahjoory, welcome back to the BiggerPockets Podcast. Excited to have you here for Part 2 of your four-part frame work. Would you mind doing a little recap on what we covered on the last episode and then giving people an idea of what they can expect in today\u2019s episode?<\/p>\n
Yeah, absolutely. It is great to be back with you guys today. And really, we\u2019re just going to continue the conversation around private money. In the last episode, we talked about what is private money, what isn\u2019t it, who are we going to target, what are those initial conversations going to look like. We ended it with an overview of our FACT framework, specifically building your foundation. And there are a lot of moving parts that go into building your foundation which is step one of my FACT framework, such as really knowing your role, being confident in who you are and what you\u2019re doing, making sure you\u2019ve got the right mindset, making sure you\u2019ve got your goals in place, your business plan, your target market identified. It really ends with us starting to plant seeds and really announce to the world who we are and what we do. And the way we did that under building our foundation was through our four second power pitch. So here we are today and I\u2019m excited to get into step two of my FACT framework, which has taking action.<\/p>\n
Right. So just to recap, let\u2019s see if I\u2019ve got this correctly. I was paying very close attention when we did this the first time. So F is for foundation, A is for action, C is for Chipotle or credibility, whichever one you want, and then T is for transaction. Is that right?<\/p>\n
Yes. Thank you. And then we also touched on some common fears and objections that hold investors like us back from taking action.<\/p>\n
So let\u2019s jump into action. Yeah, let\u2019s get into that because I know we started touching on that a little bit towards the end of the last episode.<\/p>\n
Yeah. So now that we\u2019ve built a solid foundation, we\u2019re confident in who we are and what we\u2019re doing and 24\/7 we\u2019re dropping that four second power pitch on anyone and everyone above and beyond our friends and family members, we want to focus on continuing to build our list of prospective private money lenders. Because a friendly reminder, I\u2019m going to be one of the very few people who will tell you raising money is easy when you have step systems and strategies, but you don\u2019t need to depend on your friends and family members, right? So how do we take the 70 trust and rapport building strategies that I\u2019ve created and start implementing them so we can start to convert some of these individuals. So what I want to share with you guys today are five very specific strategies that you can start to implement right now in order to build your list of real private money lenders.
And the very first one, it sounds easier said than done, you guys. And ask yourselves, how often have you done this once I share it with you. Step one of taking action is getting referrals from everyone you talk to. So you\u2019re going to see that everything is very closely linked to one another. So the end of building our foundation is the four second power pitch. We end that four second power pitch with a request for a referral, which is step one of taking action. So everyone we talk to in person or over the phone, we want to make sure we ask for anywhere from one to three referrals of somebody else who may be interested in knowing how to earn double digit returns backed by real estate.
And this is very powerful, you guys, because earlier I mentioned that I didn\u2019t start prioritizing raising capital until my second deal. When I actually implemented the strategies I\u2019m sharing with you today on my very first deal using private money from a complete stranger because I asked for referrals of a referral of a referral of a referral, in just three weeks, you guys, in 21 days, I was able to raise $390,000 in private money. And for me, that was huge because we all have different goals, right? One of my goals was I wanted to be on TV. I wanted to work with HGTV. And had I not been able to raise that money, that was the very first property that was showcased on HGTV, and I would\u2019ve missed out on that opportunity. In addition to, a great profit as well. So word of mouth goes a very long way. Don\u2019t shy back from asking anyone and everyone you talk to for that.<\/p>\n
So a tangible example of this would be you say, \u201cHey, I teach people how to make a double digit return in real estate.\u201d \u201cOh, tell me more about that.\u201d And then you say, \u201cOh, I\u2019m a real estate developer in Chicago,\u201d insert city here. They might say, \u201cOh, you know what? I actually have an uncle that does that.\u201d And so if you find out that the person that you\u2019re talking to doesn\u2019t necessarily want to invest or they show no interest, then at that moment you would then kind of push a little bit further and say, \u201cWell, hey, actually sounds like him and I would have a lot of things to connect over. Would you mind putting us in touch?\u201d Would that be an example of a referral or do you like it to even feel a little bit more organic than that?<\/p>\n
No, that was actually perfect. I also like to incentivize my audience and the people we\u2019re talking to. Now, there is a way we want to go about this so that we are not violating any SEC regulations. But you can still tell people at a very high level, \u201cHey, I also pay marketing fees or consulting fees for any referral that you send to me who ends up investing.\u201d So whether maybe it\u2019s, pick a number, a $500 thank you fee for your referrals that they end up investing, but just make it a flat rate instead of a percentage of the loan amount.<\/p>\n
So a bit of, yeah, like an incentive, \u201cHey, I\u2019ll pay you $500 if I end up closing a deal with X or X person that you mentioned or you set me up with.\u201d<\/p>\n
Absolutely. Regardless if the deal makes money or loses money. We\u2019re not going to base the referral fee on that, because that is a violation of SEC. So just a flat fee to thank you for the intro if they end up investing with me.<\/p>\n
Okay. Okay. And have you raised a lot of money through the actual\u2026 I mean, I know you did on your first one. You talked about the $390,000. But is this a pretty common place where you\u2019re usually finding success?<\/p>\n
It\u2019s very common and that\u2019s also a great segue into the second strategy. And I\u2019m going to share that with you guys right now because it just makes sense to do so. In the last episode, I talked about consistency and how I consistently implemented these strategies for 18 months. After a year and a half, I no longer had to do what we\u2019re talking about today. I could pick up the phone and have whatever I wanted, whenever I wanted. Now, do referrals really work? Did that result in a big chunk of the private money I have invested? Absolutely.
So a second strategy I will share with you as it pertains to getting out there and taking action, specifically getting creative and thinking outside the box. So how do we network and raise money with non real estate related individuals? Because it\u2019s very common for us to think, \u201cOh, I\u2019m going to raise money. In addition to asking my friends and family members, I\u2019ll go to my local RIA or I\u2019ll go ask another investor or I\u2019ll ask someone at my local meetup.\u201d So let\u2019s go above and beyond that.
So I\u2019ve got a LinkedIn strategy. This LinkedIn strategy, everyone that I connected with on LinkedIn, the sole purpose of this strategy which I will share with you in just a minute, is to get referrals. So here\u2019s what I would do. Actually, let me ask you guys this. So to Rob and David, put yourselves in the shoes of a brand new investor. If I were to ask you, \u201cHey, you guys, we need some private money. Go on to LinkedIn and see if you can find private money lenders on LinkedIn.\u201d If we\u2019re looking for private money, what are some key terms you would search for on LinkedIn?<\/p>\n
Real estate.<\/p>\n
Perfect.<\/p>\n
Real estate investor?<\/p>\n
Perfect.<\/p>\n
I don\u2019t know. I guess real estate\u2026 Do people say they\u2019re flippers on LinkedIn? Like a house flipper?<\/p>\n
You\u2019re absolutely right. And that\u2019s what a lot of people do. I love it. They may even search for private money, but the three that you mentioned are perfect. Now, this is such a good example of what we don\u2019t want to do because we want to start to think about who has money, who is someone of influence, who is someone of success and power for example, above and beyond real estate investors. So instead of searching for those traditional words that you just shared, Rob, go into LinkedIn and do a key term search on investment banker, financial advisor, stock broker, right? They don\u2019t necessarily work in real estate, but they know people with money, right?
My whole purpose of getting in front of them is to ask for a referral, \u201cHey, I\u2019m not here to dilly daily. I\u2019m not here to waste your time.\u201d Now, I don\u2019t do this in my first message. What I\u2019ll do is I\u2019ll connect with someone on LinkedIn. And I do not outsource this, you guys. I don\u2019t set up bots. I don\u2019t set up automations. I do this myself. Still today if I were to do this and I do for some of my students, I\u2019m typing these messages up myself because people can tell. When I get those automated messages on LinkedIn, I don\u2019t know about you, but I delete or I do not open the majority of them.
What\u2019s cool about this strategy that I\u2019m sharing with you is as of late, the response rate is a 50, 50% response rate. When I implemented this 10 years ago, it was only a 20% response rate. So what I do is I put in a request to connect, and it\u2019s two sentences. \u201cHey, Rob, I\u2019m reaching out due to common connections. There may be a way for us to work together and leverage off of one another\u2019s network.\u201d I just put that out there. \u201cDo you have five minutes\u201d I\u2019m very specific, \u201cfor an exploratory conversation on how we may be able to help each other out?\u201d Copy paste, copy paste, copy paste. All I\u2019m changing is the name. Set a goal to do that 10 people a day.<\/p>\n
What I like about that is most people are on LinkedIn, at least this is my impression, specifically because they\u2019re trying to make money out of their network. I think there\u2019s a handful of really successful business people that have it dialed in and they have a LinkedIn profile to showcase what they\u2019re already doing. But I think the majority of people are trying to get to that point and they\u2019re like, \u201cWell, Facebook is for my high school friends and my family. Instagram is when I want attention. And LinkedIn is when I want to try to make money.\u201d So by saying, leverage each other\u2019s networks, you\u2019re dangling the very fruit in front of their nose that they went on LinkedIn to find.<\/p>\n
Totally. I love it. The results are insane, you guys. I just had somebody fly out to shadow me for a full day. He\u2019s actually one of my active students. He couldn\u2019t believe the results that he was getting real time. It was insane. So once the person you\u2019re addressing responds, and again it\u2019s going to be about a 50% respond rate. And no, those who do not respond, I do not follow up. This is just my style. I don\u2019t have time for that. If they don\u2019t see the value in responding, I\u2019m moving on to the other 50% that do. So when they respond, we hop on a call. And what I say to them is, \u201cHey, thank you so much for your time. I\u2019m not here to waste your time. Just so you know, I\u2019m a real estate investor.\u201d Basically your 22nd power pitch, right? Your follow up.
\u201cAll of our deals are funded through investors, which is what allows us to grow and scale. So I know you may not be a real estate investor, I wanted to reach out to you in case you have a client that wants to diversify their portfolio and invest in real estate. You have a client who wants to do that? Use me as your go-to real estate investor. Anytime your client invests with me, I will compensate you in the form of a marketing or consulting service.\u201d Because they may have a license that may be an ethical violation. You can work that out with him or her, but there are still ways to compensate them. \u201cAnd hey, by the way, I promise never to go to your client directly without going through you first.\u201d
No one\u2019s going to say no to that. No one has ever said no to that in the last 10 years. Now has every single person delivered? No, but enough of them have. And then it\u2019s the same thing, referral, referral, referral. What do you say to these people? It\u2019s the four second power pitch. What do you do once they\u2019re interested? You take them through your private money presentation, right? We touched on this briefly in the last segment.<\/p>\n
And not to derail you Amy, but I just want to clarify for those that are not in the professional arena of real estate sales, many licensed professions have laws against receiving referral fees. So for instance, if you are a licensed realtor, you can receive a referral fee from another realtor who sends you business. But if you\u2019re not licensed, it\u2019s actually legal for you to receive compensation from a realtor. That\u2019s one of the reasons realtors can\u2019t pay you when you say, \u201cHey, my aunt wants to sell her house.\u201d Same is true in lending. Lenders can\u2019t receive referral fees from other lenders. There\u2019s a lot of different rules about when you can and when you can\u2019t. The Real Estate Settlement Procedures Act covers a lot of that. But it\u2019s good that you\u2019re highlighting this because if you call it a marketing fee, that often doesn\u2019t fall underneath the umbrella of referral, which could get them or you in trouble if you\u2019re receiving funds and you\u2019re not a licensed person.<\/p>\n
Exactly. And David, thank you for highlighting that because this still happens to me. I am not a licensed realtor. And you better believe because of the network I\u2019ve built and the blood, sweat, and tears I\u2019ve put into my business the last 10 years, yeah, I\u2019m taking a \u201creferral fee\u201d from a realtor. And many realtors don\u2019t know. When you tell them, \u201cHey, no, no problem. I\u2019m not a licensed realtor. I\u2019ll take my referral fee in the form of a marketing or consulting service,\u201d a lot of them don\u2019t even know that that\u2019s okay. And so they always say, \u201cLet me go talk to my managing broker and I\u2019ll get back to you.\u201d And I say, \u201cNo problem.\u201d And no, I don\u2019t put contracts in place for that. This is the honor system. If they don\u2019t pay out on it, word of mouth goes a long way. I just won\u2019t do business with them again.<\/p>\n
But it\u2019s good to note that because if you\u2019re a person on LinkedIn and you get a message from someone that\u2019s like, \u201cHey, this is what I can pay you for whatever,\u201d they may be thinking, \u201cOh, this is a trap,\u201d right? \u201cThis is somebody coming after me to see if I\u2019m going to take the bait and then I\u2019m going to get in trouble.\u201d So by spelling it out clearly in the beginning, you can kind of lower those defenses. The verbiage matters, I guess, is what I\u2019m getting into here.<\/p>\n
Absolutely. And again, I am not a real estate attorney. I am not a real estate professional. If you guys have any questions on this, talk to your real estate attorney.<\/p>\n
Okay. So we\u2019ve talked about word of mouth, meetup, and LinkedIn. One of the things I was curious when you were talking about meetups, because I think a lot of people will get in their head on this specific point and they say, \u201cWell, what if I decide to host a meetup and nobody shows up?\u201d Do you have any tips for someone that\u2019s kind of nervous to do this on how they might be able to get people to that meetup?<\/p>\n
Great question. Meetups are amazing. Whether you\u2019re new or experienced, the minute you start hosting your own meetup, you are instantly looked at as a subject matter expert in your market. You don\u2019t have to have necessarily all the answers or all the experience. Create and host a meetup and invite a guest speaker. Invite a realtor, a designer, an architect, right? A hard money lender. And yeah, guess what, you guys? You can actually start to generate referral fees from all these guest speakers, because now you\u2019re putting them into an environment where they have the ability to generate more business.
So meetups are great. I love it. Which leads me to strategy number three of today\u2019s conversation. I actually have a meetup strategy. And here\u2019s what we do. It\u2019s again another creative way of thinking outside the box and building trust and rapport with people who have nothing to do with real estate. So go into meet up and do a key term search on entrepreneurs. Any event in your market. I\u2019d even say get crazy. Go within a one hour radius. Any event in your market that has to do with entrepreneurs, go to it. I don\u2019t care if it\u2019s the food and beverage industry, the gaming industry, the tech industry. Because every entrepreneur has had to build a team or raise money, right? So if they can\u2019t help you or they may not want to help you, they\u2019re still going to know somebody who can. So again, it\u2019s referrals, referrals, referrals. Putting yourself into unique environments where there are people who know people with money or people who have money.
And in addition to searching for entrepreneurs, also search for venture capital. Venture capital, venture capitalist. It\u2019s a bunch of investors sitting in a room waiting to deploy their money, right? Go make them deploy it into your real estate business. What do you guys think?<\/p>\n
Yeah, that makes sense. I\u2019m always a little timid to go to venture capitalist because I always hear that the terms aren\u2019t quite so beautiful. What are your thoughts there?<\/p>\n
Oh, see, I love that because I don\u2019t care what their terms are, right? So I always respond with, \u201cThat\u2019s awesome. Thank you so much. My standard process is everyone receives the same rate of return, which is a 12% annualized return backed by real estate. If this is something you\u2019d like to discuss more, I\u2019d love to work with you. Let me know when we can chat about it.\u201d<\/p>\n
Yeah. Yeah. Actually one thing we didn\u2019t really cover earlier, just so I understand even your structure a little bit more and that might give a little bit clarity here moving forward, you give a 12% annualized return. So if someone invests $100,000 into one of your things, they should expect in one year, $112,000 back?<\/p>\n
Perfect. Yep. It\u2019s 1% a month.<\/p>\n
Okay. And then do you, on top of that\u2026 Okay. So do you pay the 1% a month or do you give it to them at the very end?<\/p>\n
I always pay at the end in one lump sum. My private monies, the majority of them are just listed on the HUD statement as their payoff balance is listed, and I just let the title companies.<\/p>\n
And then lastly, when you are raising money, are you trying to get the investor to, like let\u2019s say you\u2019re doing the flip, to buy the entire house outright and then fund the renovation? Or are you trying to get them to give you 20% of the flips that you can go and get a hard money loan and renovate it with effectively another lender?<\/p>\n
God, I\u2019m just filled with great questions today. That\u2019s very, very good because that comes up often. So that\u2019s your choice. If you live in a market where average price points for distressed property are $500,000, $600,000 and you\u2019ve never raised money before, go put a hard money lender in first lien position. There\u2019s nothing wrong with that. I love my hard money lenders. They were good to me. I still take care of them. I still send them business. That way all you have to raise is the gap funding, that 30%, 20%, plus all your caring cost. And then as you become an expert at raising capital, as much as you love your hard money lenders, you can phase them out. You can positively impact your bottom line and put more money in your pocket. No guarantees though, right? But then we still take care of our hard money lenders through referrals in our network.<\/p>\n
Okay. So ideally it\u2019s a\u2026 I mean, you effectively start with both, but as you get really good at raising the private equity or the private money, you sort of phase out the hard money loan people, you take care of everyone with referrals. But you phase them out simply because you don\u2019t necessarily want to keep paying points and origination fees and all that kind of stuff. Does that sound right?<\/p>\n
Yeah, because you don\u2019t need to. That\u2019s absolutely right. And you don\u2019t need to because, you guys, if you think about it, if you borrow $100,000 which is nothing, I\u2019m being uber conservative right now.<\/p>\n
Right.<\/p>\n
For some of the newbies, the cost of that capital is going to be, let\u2019s say 13% annualized if you\u2019re brand new with no assets and let\u2019s say three points, the cost of that capital is $16,000. Now at the end of the day, I don\u2019t care about the cost of the money. It\u2019s about the availability of the funds. We can all have hard money tomorrow. I don\u2019t care. I bake it into the deal. Whereas, the cost of that same $100,000 is only $12,000 when you\u2019re working with private money. So the difference is $4,000. But is $4,000 going to make or break the bank? No, but that\u2019s $4,000 on just $100,000 deal, right? So what if you\u2019re raising a half a million dollars, which most of us do on one deal anyways? That\u2019s 20 Gs, right? Or a million dollars? Or we do five deals a year? 10 deals a year? So the points really start to add up.<\/p>\n
Yeah, definitely. I mean, when David and I would close on our Scottsdale property, I think a point for us was like $30,000 or something like that.<\/p>\n
[inaudible 00:25:31].<\/p>\n
Yeah. On the luxury stuff, it can get pretty up there. And I didn\u2019t mean to derail this, but I know that a lot of people are super interested in this topic. I don\u2019t know if this goes into the T of FACT. Is that a little bit more on the transaction side?<\/p>\n
I could talk about this for hours, you guys, so it\u2019s all good with me. No, this actually comes in under step three, the credibility piece, which I think we\u2019re going to into later.<\/p>\n
Okay, cool. Yeah. Yeah. Okay, cool, just making sure. So a little preview I guess. Sorry, I get a little excited here when you talk about raising money because this is something that I think it\u2019s very important for me right now. It comes at a pivotal time in my career where I move out of buying single family acquisitions and I move into scaling rapidly. For example, I mean by the time this comes out, I should have closed on a 20 unit, a motel in New York. And so we were able to acquire that property via raising money. I think a lot of people\u2026 This is kind of the difference between slowly building your portfolio, but there comes a time where if you don\u2019t want to just buy your home after home after home, raising money is super important if you want to scale in a big way. Now, obviously your mileage may vary. It\u2019s not the case for everybody, but for me it is right now. So I always get very curious about the actual nuances here.<\/p>\n
Yeah. And that\u2019s interesting because you\u2019ve talked about the Burst strategy. A lot of the examples I\u2019ve shared revolved around fix and flips. So there are a lot of that investors out there who may be thinking, \u201cWhy do I need to learn how to raise capital? I don\u2019t want to flip, I don\u2019t want to wholesale. I don\u2019t want to even implement the Burst strategy. I want to go by turnkey rental properties. I want to go invest in a commercial syndication. I want to go start a fund.\u201d Okay, fine. You still need to know how to raise capital to do all those things, right? So we\u2019ve all heard cash is king. It is endless opportunities when you know how to raise capital. You\u2019re going to start getting approached like I did from people out there who want you to be their capital partner and compensate you very well to raise money for their business. So there\u2019s so many ways that you guys can get creative and really just from this one skill set, start to generate so many multiple streams of income.<\/p>\n
Yeah. Yeah, totally. So I guess that kind of goes into the meetup side of things, which is kind of where we left off. When you said that you were going to these different events, you\u2019re going to meetups that aren\u2019t particularly, I guess they may be adjacent to what you do, but not necessarily. You go and you network with those people. You give your four second power pitch, maybe even the 22nd follow up. And then from there, you invite them back to your meetup that you\u2019ll be hosting pretty soon. Is that right?<\/p>\n
Sometimes I will if they\u2019ve expressed an interest. My main strategy is to place myself into environments where there\u2019s money. And so going to other entrepreneurial events means I\u2019m aligning myself and surrounding myself with other business owners who have been challenged with the same task as me, and as a result they know people with money or they have money of their own they may want to invest. And sure, if that conversation leads to it, I have absolutely invited them to my meetup. Maybe they\u2019ll be a guest speaker. But it\u2019s cool, it\u2019s another great segue into the four strategy that I wanted to share, which is coming off meetups and [inaudible 00:28:59] that into attending high end fundraising events.
An example I often share is we talked about this earlier. How do we start to integrate these creative trust and rapport building strategies into our day to day lifestyle? Is it just something that we do without being as calculated the more we practice and the better we get? Yes, absolutely. So for example, when I started my real estate business, I was living in this high rise condo in Downtown Chicago. I was single at the time and I was maybe eating out a little more than I should have. I would always frequent this dive establishment that I loved. Once I started prioritizing the power of raising capital, I said to myself, \u201cAmy, what are you willing to sacrifice? Is it really a sacrifice if you can\u2019t go to Snickers your all time favorite dive bar three days a week, and instead one day a week, you go to a fancy restaurant,\u201d right? During happy hour in a non creepy way and you start to talk to the locals, to the business owners.
Or every year I would invest in a VIP ticket and I\u2019d go to the Chicago Auto Show. I could care less about cars. I don\u2019t even know anything about cars. I don\u2019t care. But when I spend, I don\u2019t know if it was $200 or $400 to a black tie event and I go to the Chicago Auto Show by myself, which was very nervous as extroverted as I am for me, I\u2019m placing myself into environments where there are people with money. And I would work the room, again in a non creepy way. 15 minutes, that\u2019s it. I would try to shake as many hands as I could every 15 minutes. What am I saying to these people? I\u2019m going to sound like a broken record, you guys. It\u2019s the four second power pitch, right? I\u2019m just planting seeds.
So going to fundraising events is a great strategy. I would challenge you to ask yourself, if you really believe that you\u2019re sacrificing activity A with activity B when you maybe skip out on a family lunch or even a family dinner or a coffee talk with a girlfriend or guy friend, is it really a sacrifice? Because what does it mean if you\u2019re working towards crushing that goal, right? There\u2019s so much that you can tie to this. But fundraising events have been very fruitful for me as well. What about you guys?<\/p>\n
Yeah. I mean, when you say fundraising event, it\u2019s not necessarily just quite like a literal charitable drive or anything like that. In your mind, the way you\u2019re defining a fundraising event is just maybe like a high ticket event or something that\u2019s a paid entry where there are wealthier individuals that might be more investment-focused. Is that correct?<\/p>\n
Yeah, you\u2019re absolutely right. Yeah, high ticket events. I mean, depending on your market, there are a lot of high ticket fundraising events as well. But I would really focus it on high end because that\u2019s where the other business owners and entrepreneurs are going as well. And if it\u2019s not within your budget, again, what are you willing to sacrifice?<\/p>\n
Right.<\/p>\n
Don\u2019t get [inaudible 00:32:22].<\/p>\n
Lunch for a month or go to this event and raise money, right?<\/p>\n
Thank you. Exactly.<\/p>\n
So I\u2019m kind of curious on this. What are your thoughts on \u201clooking the part\u201d? If you\u2019re going to an investor, is it okay to be like a casual dressed? Or do you really take on the philosophy of like, \u201cHey, look the part, be the part,\u201d especially with these fundraising events?<\/p>\n
Oh man, I don\u2019t know if you want to ask me that question. So here\u2019s my response, because I told you I\u2019m very direct. I\u2019m going to give you the good, the bad, the in between.<\/p>\n
Okay.<\/p>\n
Now, I\u2019m always going to dressed respectful. And at a black tie event, I\u2019m going to dress up. But once I quit my job at Dell, I mean even still today, I\u2019m wearing a white t-shirt and black leggings. I mean, I don\u2019t have fancy clothes. Maybe three dresses I use when I hop on a stage and do a keynote. But no, I\u2019m casual. I\u2019m respectful, but casual. Because what I have found is people want to know you. They\u2019re investing in you. And as a result of investing in you, they\u2019re investing in your business. I\u2019m not going to show up in a dress or a suit. Or I may get crazy and wear heels with a pair of jeans, but that\u2019s it.<\/p>\n
Okay. So really what you\u2019re comfortable with, you know?<\/p>\n
Yeah. Just be you. Do you, I mean, there have been times where I\u2019d literally be wrapping up a meeting with a general contractor in my gym clothes and I\u2019d go straight into a private money meeting and I crack a joke about it. I mean, at the end of the day, we are all just normal people, right? And everyone can relate to our day to day lifestyles. So I crack jokes often, and I do that with my private money lenders as well.<\/p>\n
Yeah, that\u2019s good. That\u2019s good. So David, you don\u2019t have to wear a tuxedo every day, man. Just be yourself. I think that\u2019s the tip here.<\/p>\n
Okay. So my thoughts on this question is really good. First off, I do think certain people do need to dress differently than others. I guess I\u2019m just saying it\u2019s not a blanket statement for everybody. So Amy can get away with wearing the top and the leggings that she described, because Amy, you\u2019re very articulate. You are clearly confident and professional, and you\u2019ve done this before. Your personality, the way that you come across, is very strong and confident. So that makes me feel safe if I\u2019m going to let you borrow money.
There\u2019s other people that have naturally withdrawn personalities. Maybe haven\u2019t done this as much that are going to be a little more timid or pensive. They\u2019re looking at their shoes when they\u2019re talking. They have a harder time holding eye contact. What I tell those people is, \u201cYou need to be wearing a nice suit and you need to come across very strong\u201d because that will add strength to the impression that you\u2019re giving to somebody. Someone like me that just kind of like steamrolls everyone, I know that\u2019s a thing that I tend to do, it\u2019s almost better if I\u2019m not wearing really nice clothes because it\u2019s too much. It\u2019s like looking directly at the sun. You\u2019re like, \u201cOh, I can\u2019t even listen to you because you\u2019re just like pounding me.\u201d So I noticed I could get away with wearing way dressed down from everyone else, right? But I do think that it\u2019s custom fit for every personality. And this is the same thing I tell real estate agents that are on my team.
Amy, you\u2019re amazing me with how many of the strategies that you\u2019re using to raise money are the same things that other businesses do when they\u2019re just trying to find leads. What you\u2019re really talking about is a lead for your business when it comes to money. These strategies are so similar. What I tell them is if you are a sort of not as confident person, maybe a little more shy and introverted, having a nice car will really help you because it\u2019ll make people say, \u201cWell, what is it about that gal? She\u2019s driving a really nice car, even though she doesn\u2019t talk much. Maybe she\u2019s just a genius and she doesn\u2019t communicate well.\u201d Or if you\u2019re someone who is very bold, I actually dial it back. I drive a Camry. I don\u2019t want to show up somewhere in a Ferrari where now people think that I\u2019m this pretentious a-hole and I have to do a lot of work to overcome the objections that you got when you just saw me walk in the door. I want to make it as easy as myself as possible to get my point across.<\/p>\n
I mean, it really seems like it boils down to authenticity though, right? I mean, I\u2019m in the midst of getting my real estate license and I have kind of an apprentice that I\u2019m training who\u2019s going to be doing a lot of the transactional work by my side. I was talking about creating content and how I plan on starting a YouTube channel that focuses on the Houston market. And she was like, \u201cYou\u2019re going to wear that?\u201d And I\u2019m like, \u201cYeah, I\u2019m going to wear a graphic tees, tees with funny things on it, tees with skulls on it, my black pocket tee. It doesn\u2019t matter.\u201d Because I was like, \u201cI don\u2019t want to be the realtor that wears the suit. I want to be the millennial realtor that\u2019s super casual.\u201d And I think she was like, \u201cOkay, if you\u2019re sure.\u201d And I\u2019m like, \u201cYeah, I\u2019m sure. I do it every day.\u201d People don\u2019t really consider what I wear because I think it\u2019s all about the conversation and the authenticity that drives that conversation.<\/p>\n
Yeah. Both of you just gave really great pieces of advice. It ultimately does come down really to your personality and things you need to strengthen. So for those of you out there who are newer or maybe you\u2019re an expert real estate investor but you\u2019re new at raising private money, if you\u2019re not sure what approach to take, you\u2019re a part of an amazing community. Turn to your BiggerPockets community or other communities that you\u2019re a part of and ask for support, ask for advice. Ask for help and let them help you if you would like some support in that area.<\/p>\n
So have we covered off every strategy? I know we talked about word of mouth, meetup, LinkedIn, fundraising. Was there one that we were missing there?<\/p>\n
Yeah. I wanted to really wrap it with something you touched on earlier, Rob, which was pretty cool. Remember, I joked about you stealing my thunder?<\/p>\n
Oh, right, right. In Episode 1.<\/p>\n
Which is your online presence, because I come across so many real estate investors of across all ages who will shy away from social media. Social media is so powerful. There are such respectful and tactful ways that we can share what we are doing as individuals, as business owners on social media. And really when it comes to your online presence, this is the fifth strategy I wanted to highlight with you today, there are two things I would invite you to consider. Number one is making sure you have a credible website. It does not have to be a fancy website. It does not have to be a complex, big investment website. I don\u2019t even care for newbies if it\u2019s just a landing page. Because whether we like it or not, one of the very first things every private money lender is going to do when we speak to them whether it\u2019s in person or over the phone is Google us and check out our website. So we want to make sure we have some sort of a landing page, a core website for them.
And then number two is we do want to make sure that we are active on social media. Specifically, and this can be debated or discussed, I have found success and I continue to find success on Instagram and LinkedIn. 10 years ago, Facebook was one of my strategies. I\u2019m not converting anything on Facebook anymore, considered a weakness of mine. But with private money and other parts of my business, Instagram and LinkedIn have been amazing. I just had a conversation with my videographer yesterday. She\u2019s trying to get me on TikTok and I\u2019m like, \u201cGirl, I don\u2019t have time for that.\u201d But your online presence is huge. And if you need help figuring out what to share or what to post, share other people\u2019s content. Take a BiggerPockets post or podcast, share it. \u201cHey, you guys, check out this great read from BiggerPockets on the interest rates or the economic downturn or the trendiest paint colors for spring,\u201d whatever, HGTV.
Take projects that somebody else in your network is working on. Share them. We\u2019re all looking at properties, right? David touched on deal flow, lead flow, marketing for deals earlier. The next time you walk a property, take your phone and take a selfie photo or video, \u201cHey, you guys, about to walk this distress property. Stay tuned for updates.\u201d People love watching that. Put it on social media. You\u2019re not saying you bought it. You\u2019re not saying it\u2019s yours. You\u2019re not saying you\u2019re going to buy it. You\u2019re just saying, \u201cHey, check out this property.\u201d
The next time you go to a meetup or a networking event or even when you\u2019re on a podcast or a virtual event, take a screenshot, take a picture. Share it, right? You don\u2019t have to say you\u2019re talking to a coach for example. You can just say, \u201cCollaborating with other like-minded investors. Excited about what the future has in store.\u201d So there\u2019s a lot we can do when it comes to building your online presence. The two key takeaways is having a core website, and then number two, having a social media presence. What do you guys think about that?<\/p>\n
Oh, 100%. So I always talk about putting yourself out there, letting people know what you did. I think I talked about this in Episode 1. And a lot of people are like, \u201cWell, Rob, it\u2019s easy. You got a YouTube channel and blah, blah, blah, blah, blah, blah,\u201d right? And I\u2019m like, \u201cWell, I mean, I\u2019ve got that channel because I put myself out there,\u201d A, just to dismiss that, but B, most of the partnerships that I have, have not come from my platform. They\u2019ve actually come from the interpersonal communications in my life because I was always posting photos of my tiny houses and of my glamping things and people are like, \u201cWhoa, tell me more about that.\u201d
So just right off the bat, posting on your social channels and letting people know, that\u2019s going to be huge for you. But secondly, you do have to work for posting to social and creating a social presence. So I don\u2019t want to necessarily simplify that, but I do think that it\u2019s also not incredibly difficult to build that brand out. You can absolutely do reels in TikTok. And I know a lot of people that make seven figures from the marketing they do just off of reels in TikTok, right? Reels, that\u2019s what Instagram is pushing right now. And so if you make a lot of reels, there\u2019s a very high likelihood that Instagram is going to be pushing your content out to new audiences. It\u2019s the same thing with TikTok. Most of the time when I post a TikTok, it\u2019s going out to people that aren\u2019t in my audience. And if it goes viral, it\u2019s going viral from people that have never seen my content before. And then it gets served up to my audience.
And so a lot of people think you have to have a really big platform to do this kind of stuff, but it\u2019s just not true. You can post something on TikTok and be an overnight sensation if you really hit the points right, if you\u2019ve got a good hook, if you\u2019ve got a good video overall. So I just think a lot of people tend to hold themselves back on the premise of comparing themselves to other real estate content creators and they say, \u201cOh, I\u2019m not going to be really great when I get started.\u201d And the reality is, you\u2019re not going to be great when you get started doing this. You got to work towards it. You got to work at enhancing your brand and posting daily and consistently. And if you do that, you will see results.<\/p>\n
But you know what\u2019s so crazy, Rob, is I just had this conversation yesterday. I mentioned earlier I was talking to my videographer and I said to her, \u201cShould I start a YouTube channel? Because I have one, but I do nothing with it. And oh my God, my coaches and mentors are telling me I need to do this.\u201d So it doesn\u2019t matter how experienced or successful we are, you guys. We all have fear, right? And things that hold us back from taking action. It may sound silly to other people, but one of mine is, I don\u2019t know how to start a YouTube channel. Am I going to get criticized by people? I can\u2019t deal with the negative comments. What do I do? But I know I have all of this content that I want to share and raise awareness on. So even you just sharing your story and your experiences has motivated and inspired me.<\/p>\n
Well, and we actually just talked about this recently on Episode 629 with Brandon Turner. We talked about growing your personal brand and your social presence online. I mean, it was effectively a 45 minute masterclass on everything you need to know to really develop your personal, your ecosystem, whether it\u2019s TikTok, Instagram, Facebook, YouTube, or everything. So if you\u2019re interested in learning more about that, be sure and go download that and give it a listen after this episode.<\/p>\n
Yeah. Again, thank you for that. I selfishly appreciate that. At the end of the day, you guys, it\u2019s all about our mindset, right? And remembering that we are providing others with an opportunity to invest. If they don\u2019t see it that way, then we genuinely have to believe that\u2019s their loss and we\u2019re going to go respond to the other 15 people knocking on our door, ready to invest with us. Even if we don\u2019t have 15 people knocking on our door.
And here\u2019s the best part. Once these transactions start to come in, which is step four of the FACT framework, which I know we\u2019ll get into later, then it\u2019s going to have a snowball effect on everything you\u2019re doing. And yes, you\u2019re actually going to have more money coming into your business than you even want or need. And so there are going to be ways where you are respectfully going to work with private money lenders, and then also turn away private money lenders whose ethics and morale do not align with yours. Because remember, we don\u2019t need them. We don\u2019t need their money, right? Because we have the right mindset. They need us. We are the ones providing them with double digit returns, with a protected, secured, and insured asset. They\u2019re not getting that in the stock market. They\u2019re not getting it in the bank. So as long as you have the right mindset going into this and you remind yourself of who you are, what your ethics and what your morale consists of, you guys are going to have no problem getting out there and confidently raising money.<\/p>\n
Yeah. Well, this was awesome. I\u2019m really excited to get to the C, the credibility step here in the next episode. But to quickly recap here, I just wanted to make sure I got the five action strategies correct, and in no particular order. I know you have a lot more of these, so we\u2019ll definitely need to cover these at a later point.
But starting with number one, word of mouth. Referrals. Getting yourself out there, meeting people, asking if those people know people that might want to invest with you. Number two, having a meetup. And if you want to market that meetup, go to several different meetups around the world. Oh sorry, around the city within a one hour radius, I think is what you said. I mean, you could do around the world if you want, it\u2019s just going to be a lot more expensive. But go and network with people outside of your network and see if you can get them to come to your meetup. And by doing so, you\u2019ll prove that you\u2019re a subject matter expert and people will more than likely build a little bit of trust and rapport with you because they see you as somewhat of a local leader in that space.
Three would be getting onto LinkedIn and making connections with a lot of people. Make sure that you\u2019re not building any kind of bots or any VAs doing this. Try to have a personal message that you send to a lot of people. Let\u2019s not say be on the nose here and hit up real estate investors or real estate flippers, but people that might actually have wealth in a different arena that are looking to diversify. So physicians, maybe even like you said, a venture capitalists, doctor, all that kind of stuff. Then we move into number four, which is fundraising events. Go to some high ticket events, high ticket events that you might have to go and buy a ticket. Maybe it\u2019s a conference. Maybe it\u2019s another event that\u2019s a $500 car show in your city and try to network with as many people as you can.
And then lastly, online. Put yourself out there online, whether it\u2019s posting to your personal pages or really just kind of digging in to the Instagram side of things or digging into TikTok or whatever that might mean. But really being consistent and intentional about your social posting. Does that sound right? Did I miss anything there?<\/p>\n
It was perfect. Thank you, sir.<\/p>\n
Thank you. Well, we appreciate it. I mean, this is really a master class. It\u2019s going to be an amazing four part series. We\u2019re super, super excited. Before we wrap up today, was there anything else that you wanted to just leave us with as we kind of get ready for the next episode?<\/p>\n
I don\u2019t think so, you guys. Just really remember I guess what\u2019s your why, right? We\u2019ve all heard about that, right? What\u2019s your why? What\u2019s your driving force? Because you guys got this, whether it\u2019s raising capital or other parts of your real estate business, you can do it. Tap into your why when you feel like you may be lacking motivation. And just turn to your community for support. And we got you and we\u2019ll see you in the next episode.<\/p>\n
Awesome. Well, before we head out, can you tell us a little bit more about where people can learn about you online?<\/p>\n
Yeah, absolutely. I\u2019m trying to, as much as possible, share as many tips and strategies on Instagram primarily. So I\u2019m always sharing videos or pointers or graphics. So if you just check out my Instagram handle, which is just my first and last name, @amymahjoory, you can connect with me there. I don\u2019t outsource any of that, so it\u2019s a direct line to me. If you have any questions that went unanswered on this series, feel free to hit me up via Instagram and I\u2019ll respond within 24 hours.<\/p>\n
Awesome. David, what about you, man?<\/p>\n
Find me, @davidgreene24. Check out my YouTube at youtube.com\/davidgreenerealestate. And you can message me on the BiggerPockets\u2019 platform. It was weird. I took a second there to try to remember what my YouTube thing was, even though it is the most boring name anyone could ever think of.<\/p>\n
Hey, you can find me at YouTube at youtube.com.<\/p>\n
That\u2019s exactly what I did. I was trying to buy myself time to remember what the name was there. Doesn\u2019t happen too often. All right, Amy, this has been a blast. I\u2019m excited. We have more going on.
Personally, this is just my opinion, we\u2019re probably entering into a market that\u2019s going to be the best buyer\u2019s market we\u2019ve seen in at least eight or nine years. And if you are looking to ramp up, right now is a great time to be borrowing money. And for those that have money that don\u2019t know how to invest in real estate, they have to earn a return on it because inflation\u2019s eating it up. So on the people who need to lend money, they have pressure on the people who want to be buying houses. Like us, we have pressure because the market\u2019s good. This is a very good time to be getting into the industry.
So if you guys like this content, stay tuned because we\u2019re going to have Amy back for some more shows to complete her four step process. So my advice would be to go practice some of what you\u2019ve learned right now on some of the people that are in your life. See if your elevator pitch can be improved. See if you can set yourself up to start attending some meetups, and maybe you can even start posting online. Getting some of the bugs worked out on your own game. And then the next time we have Amy on, you\u2019ll have even more information to put into play.
All right, I\u2019m going to get us out of here. This is David Greene for Rob Be Yourself, because everyone else has taken Abasolo, signing off.<\/p>\n