Week 3 – Money + Internal Teams.

Week 3 – Introduction: Money + Internal Teams

Welcome to Week 3

Welcome to Week 3

Week 3 – Day 1: Money Team (Lenders)

‘Money’ Team

'Money' Team

Your Money Team:  

Your money team consists of..

  1. Mortgage Broker
  2. Private Money Investors

Today we’ll focus on the mortgage brokers… 

  1. These are the people who are going to get us the bulk of the money for our deals. 
  2. We always leverage our deals so we can scale faster
  3. 70-80% come from lenders
  4. 20-30% come from Private money investors 

National Lenders 

With these properties, we are going to use national lenders to give us the first seventy or eighty percent. We’ll usually take out conventional mortgages with seven or ten year balloons, depending on what the market is doing when we buy.

  1. Low Interest Rates: Typically take out a conventional mortgage that has a ten year balloon that will be able to be assumed at least one time.

What this does is gives you ability to allow your next buyer to assume your lower mortgage. Let’s say you buy at a rate of 4.25% and four years later when you go to sell, the interest rates are 6.35%. Your property is going to be a lot more attractive when you can offer the lower interest rate. This is a good exit strategy.

Mortgage Broker

Unless you’ve been in this business doing deals for many years, you’re not going to know what lender is best at what type of deal. Every deal you do is going to be a little different; no two deals are exactly alike. Some lenders are strong doing certain deals and other lenders are not.

Your mortgage broker is going to set you free from this search and they will set you free from making a bad lending decision. Rely on them to place your loan with the proper lender. Remember, they get paid when the loan closes; they want the loan to close as much as you do. They are going to steer you to the lender that will close the deal.

Not only will they provide this service but they will also become your own in house analyst. Once you start doing this business and start closing deals, you’re going to be getting a lot of people sending you a lot of deals. Once you become known as a closer, everyone knows your name.

It takes time to analyze all of those deals, what would it be like if you could send all of the deals that are sent to you to your analyzer and you only deal with the ones that appear to be real deals. Think of how much time that will save you.

All big companies have analyzers in their company; their sole job is to weed out the bad deals and spot the good deals. They cost a lot of money to put on staff. You could have your own staff for free; you will use the company of your mortgage broker. They will analyze your deals, knowing that when one works, they will do the loan and make their money during that process.

This is going to free you up to do what you do best, create relationships, and get more deals.

Here is the other thing your mortgage broker is going to provide for you…information. He’s going to keep you informed as to what’s happening in the capital markets and how that is going to affect future lending so you will know how that is going to affect the way you look at  the deals that are being presented to you.

Your mortgage broker is going to be a key player on your team, seek out a good one and use them to their full potential, you will be rewarded.

Advice

-Use them to source the loan 

-Use them to double check your numbers

-Use them to underwrite deals

-Use them for information regarding the capital markets 

Mindset: The Power of Leverage

Take Action: Call & Interview Commercial Lending Brokers

TAKE ACTION

1. Call & interview 3 commercial lending brokers

  • Use the “Lending Broker” checklist provided in the Deep Dive Topics Course

2. Ask for a referral on the Multifamily Mindsetter FB page

SUBMIT

Submit your list of talking points for your commercial lending broker calls.


Week 3 – Day 2: Money Team (Investors)

Chapter Overview: Private Money Investors

Chapter Overview: Private Money Investors
RAISING PRIVATE MONEY!! 


The secret to being debt free is to create MORE VALUE in the world THAN WE CONSUME and to Serve more than we are served!!
When we open our minds and shift our perspective and think beyond our small financial concerns we begin to identify ways to fulfill the wants and needs of others. In other words we find ways to provide value!!!
When I opened my mind, shifted my perspective, and moved past my financial concerns my life changed dramatically! 
I repeat that because today, and the rest of the week we’re going to talk about getting that cold hard cash!! 
But I want to be clear raising private money isn’t about us. It’s about our investors!! 
It’s about how we can use our talents and are taking the knowledge we’re learning and acting upon Every day and using it to help your investors get better returns!!! 
Remember that and your life will change dramatically as well because you will be one valuable, and dare I say attractive son of a B!! 


Alright, let’s dive in!! 


Private Money Investors as you probably know cover the last 20-30% of the equity needed to close!
Because of that Raising Capital is one of the most coveted skills in this business! 
Money might not buy happiness but it will buy a whole bunch of apartments!!! 
So, as long as we’re in this business we will always be looking to build investor relationships!! 


The Raising Private Money Series Will Consist of 3 Parts


1- Laying the foundation
What to do before you have a deal, Essentially where to find investors, what to say, and how to prepare them! 


2- Contract To Close
Which will cover how to present the deal to your investors & complete the raise! 


3- And Investor Relations
How to communicate with & take care of your investors After you close!! 


Today we will begin the Laying The Foundation Series! 


The foundation will include:


A quick overview of raising private money.
The Proper Mindset or  “Frame“.
How to create Raising Money Systems. 
Content Creation
Building an email list
And Networking Events! 
And how to Perfect Your Elevator Pitch


Here’s a quick overview of private money investors.


First, These Are High Net Worth Individuals who will invest anywhere from $25k to $25M.
They Are Typically Looking For an 8% Preferred Return which just means they get paid first, and they expect Annualized Returns to be north of 16% over a 3-5 Year Hold!! 
Friends & Family Are Usually Where People Start.


They Typically Invest With:


Self Directed IRA’s & 401k’s
Cash
Equity lines of credit are also popular
 I just read a stat that there is…. 14 Trillion Dollars of untapped equity in the US right now!! That’s crazy!!…. it’s our job to help people put that to work for them!!! 


Family Office Functions Are a great resource! 


These are Families who have created massive wealth in different industries. 


Most popular family offices are:


The Family Office Club
Opal Financial 


Crowd Funding is growing in popularity, and certainly something to check into but I’ve never crowd funded for a deal. 


The two most popular sites right now are:


Fundrise: Which allows accredited and non-accredited investors to participate.
Crowdstreet: Which is for accredited investors wanting to invest in secondary markets.


As a reminder there Are 3 Basic Types Of Investors: Accredited, sophisticated, and man on the street.


Accredited Investor


To qualify as an accredited investor they must meet at least one Of The Following:


1- Earn $200k / year
2- $300k if married 
3- Net worth 1M not including equity of home 


We can have an Unlimited Amount on our Deals.


Sophisticated Investors 


They don’t meet accredited Investor Qualifications but they have investor experience, which makes them a little more risky. 
Can have no more than 35 on deal.


Man On The Street


Risky investor, Usually friend of family member. 


We can use a basic form to qualify them.


The PPM (private placement memorandum) will have the actual subscription agreement.
This is just another layer of security for us and to make sure we’re not wasting our time. 
You should have the template for this form within the PATH but if you can’t find it, let us know and we’ll send it over! 


What Are Investors Looking For?


The first thing I’d challenge you to do is ask: What do your investors want?and What are they looking for? 
On a basic level, they will be looking for either Cash Flow or Equity. 
Regardless It’s important to know what’s most important to them so we can focus on their goals!! 
Meaning that we only send them deals that meet their criteria!!  


On a deeper level they are looking for:


Diversification 
Open Communication 
A Solid Business Plan
Consistent returns and High returns 
Stability
Tax incentives
Passive income
Risk adjusted returns
Hedge against inflation 
Something Backed by a hard asset
Etc


Two Offerings That We Typically Use:


506 B 
506 C


THE 506 B is probably the most common.


The Pros:


We can accept up to 35 non-accredited investors And Investors can also self verify, which makes the process easier! 


The Cons:


No general solicitation or advertising allowed. Which means we have to have an existing relationship with all investors! 


THE 506 C 


The Pros:


We can broadly solicit and generally advertise our offerings which can be very nice!!! 


The Cons:


All investors must be accredited investors. And we have to take “reasonable actions“ to verify accredited investor status. 


This usually involves using a third party like Verify Investor to verify accredited status or verifying through their personal CPA. Both of which can be a taxing and frustrating process for us and investors! 
We’ve done both types of offerings and there are definitely pro’s and con’s to both! 
My advice is to talk to your SEC attorney when the time comes and decide what’s best for you! 


THINGS TO REMEMBER 


Under promise / Over Deliver


Never try to inflate your numbers in the hopes to attract investors! 
That will ruin relationship, stunt growth, and Make your life hell through the entirety of the hold!! 
It’s critical that we do everything in our power to hit our return projections, Especially in the beginning! 


Remember that Communication Will Solve Many Problems  


Let them know that they can call anytime, trust me, They rarely do! 
But offering this and meaning it will absolutely set you apart! 
Also make sure you’re sending reports regularly and on time.


We send: 


Monthly & quarterly reports
Monthly Profit & loss statements 
Budget comparisons
Variance reports
and Executive summaries! 


We’ll cover all of those in more detail later but for now it’s just important that you know to make it a priority! 


Treat the money better than you would your own!! 
This would be My greatest advice! 


Meaning don’t do any deal simply because YOU would make money from the deal.
Remember the quote in the beginning: We have to put our petty financial concerns aside and focus on providing TRUE value!! 
Don’t try to underestimate the downsides of a deal just to get an investor to do something either! 
Own every downside, then explain the solutions and let them make the decision that’s best for them!  


I believe that trust is ultimately given to people who are worthy of that trust and y’all are absolutely worthy of it you just have to decide to be!! 

Accredited Investor Form

Mindset: Imposter

Week 3 – Day 3: Raising Money Through Content Creation

Raising Money Through Content Creation

Raising Money Through Content Creation
First, before we dive in, let me reiterate the proper investor mindset!


I want to make this clear!!
Raising money is NOT about trying to convince people how great real estate investing is!!


Look for Low Hanging Fruit


Raising money, or at least raising money effectively, is about gathering the low hanging fruit.
We do that by creating an infrastructure that attracts potential investors who were already interested in real estate!
I’ll almost guarantee that you need to completely reverse your sales process.
Instead of chasing down potential leads, they need to be chasing us!
When we create systems like that we don’t get burnt out talking to uninterested people.
Instead we acquire investors who not only want to invest, but who want to invest over and over again!!
This is the only way we can scale!


Those raising money systems are things like:


Creating Educational Content.


This is what we’ll be talking about today.


Building and Utilizing an email list.


Tomorrow we’ll talk about building out initial investor list.


Perfecting Your Elevator Pitch    


And to round out the systems, we’ll dial in an elevator pitch.


If you already have an elevator pitch… there’s a great chance you’re doing it wrong! 


First we’ll talk about Creating Content


There are a lot of strategies to help you raise money. 
But none are as efficient as creating a significant amount of content! 


Forcing yourself to create and publish content will:


Help you learn the business quicker.
Create credibility with investors.
And for sure help us raise more capital!!
This will come in the form of:


Blog Posts.
Email Marketing.
And Social Media Posts.


The Key will be providing HIGH value content that people can actually benefit from.


Let’s discuss how we do that in the most efficient way possible. We’ll Start With Blog Posts.


And I’ll warn you up front, this might sound daunting.
Trust me though, this step will make the other steps a cake walk!! 


On a side note though…


Creating a significant amount of educational content is multi beneficial:


First, it Aligns investors with your investment perspective.
Second it creates credibility.
And lastly it forces you into learning EVEN MORE about this business!!


You’ll move from student to teacher. Which is extremely powerful!
And mentally you’ll slowly change your identity!!


THE FIRST STEP IS:


Block out at least 60 minutes to brainstorm article topics.


STEP 2 IS:


Write down 100 potential real estate topics.
I know that sounds un-bearable! Stick with me!
We’ve already created a resource to make this a whole lot more simple!
I know, You’re welcome!
Another tip is to keep the topics evergreen so you can continue to re-use them!
Now before procrastination sets in, remember that procrastination is the ultimate killer of success!!
I promise you’re going to be damn proud of yourself for what you’re about to put together!!
Which is one of the reasons this step helps shape your identity as an investor.
Also, when we overcome procrastination and complete this step we will be heads & shoulders above the competition!


Next up is STEP 3:


Don’t judge the topic ideas!! Please understand that most of the article topics you write down might be worthless.
I say that so you free flow instead of critique each topic.
This should remove the pressure & help with procrastination as well.
Come on… you thought I’d leave you hanging!!
This is why you paid the big bucks!!!
That being said, I’m only giving you 50 ideas! But at least you’re half way there!!! 
We have these listed as a resource in your workspace… so don’t worry about writing them down!!  
I know, I know… I’m the best.


For STEP 4 you will:


Choose the top 12 topics that you feel are best to write a blog post about.


Then comes STEP 5:


Schedule a time to write your blog post.
Putting this on the calendar is critical to eliminate procrastination
I suggest time batching this task and establishing a recurring content creation schedule.


For example:


Write from 6 a.m. to 7:30 a.m. Every Monday, Wednesday, and Friday, completing them one by one.


And the last step, STEP 6:


Actually Write Your blog posts!!
Try to keep them between 1,000 and 1,500 words.
Offer enough detail to establish your expertise in the space and educate your potential investors.
And make sure to keep our particular audience top of mind when both brainstorming article topics and actually writing the content.


Okay lets get into what we call “52 Email Blasts”


Why 52 of these?
This Provides regular, informative content, for an entire year! And we can knock it out in one swoop! 
They are 300 to 500 words.
And are used with the intention of intriguing the reader.
Feel free to use bullet points. 
The goal is to attract them back to your website.


Some Tools:


We use ActiveCampaign (www.activecampaign.com) for our weekly email blasts.


Other options are:
Mailchimp (www.mailchimp.com
GetResponse (www.getresponse.com)


All of them have different benefits and prices.


Alright, once we break the blog posts down into email content we can now break the email & blog posts down into Social Media content.


First, Social Media Posts


Break down the content from those posts & emails into small social media posts.
With some effort, you could break those posts down into a years worth of social media content!
Which means you now have a year of content on autopilot while you focus on what you’re good at, building relationships!!


Another great thing is E-Books


E-books are a great way to provide value for investors!
They’re free to distribute.
Can be packed with information.
And can be created from your blog posts and articles.
They should be roughly 7,000-12,000 words in length.


“10 ways to do X”
“9 Reasons why…”


Make sure content will be relevant for a long time.
Include CTA’s.
Make it easy to read.
And Have someone else design it!!!

Content Strategy Outline

100 Article Topics

Mindset: Fear of Failure

Take Action: Create Some Content

TAKE ACTION

1. Go and write a blog article on multifamily syndications. 

SUBMIT

Submit your written article or a list of article topics of your own. 

Week 3 – Day 4: Perfecting the Elevator Pitch

Perfecting The ‘Elevator Pitch’

Perfecting The 'Elevator Pitch'
PERFECTING THE ELEVATOR PITCH… 


The ability to perfect your elevator pitch will create amazing amounts of traction in this business!! 


It will help you raise money, find deals, and open up doors that you didn’t know existed. 


People struggle with elevator pitches for a few reasons. 


They don’t take time to think through the structure
Instead they just come up with it on the spot. 
We need to put some effort into this, just like anything.


They think the elevator pitch is a tool to get them what they want.  
Your elevator pitch isn’t about you or what you want
It’s about other people, their problems, and what we can do for them. 


The Typical Elevator Pitch 


Here’s how most investors answer the question of “What do you do?” 


“Well, uhh… I’m a real estate investor who buys apartments… and ya, what do you do?” 


If they have some training or a little experience they might answer…. 


“We buy commercial real estate in emerging real estate markets across the U.S.”
“I work to identify economic growth factors in certain areas and then buy apartments in those areas. I’ve found that those growth factors help to provide better returns.”


Those answers range from basic to complicated.


Some might think they’re boring
Some might be intrigued 


But I’ll tell you what NONE of those answers provide… And why most people struggle to gain traction through elevator pitches… 


Their “Pitch” doesn’t fulfill any BASIC HUMAN NEEDS!! 


Here’s the deal… I promise you, if you use those examples “enough”… someone will eventually bite. 


But you will have to Ho’omau like a son of a bitch!! 
For those of you with bad memories, that means ENDURE WITH DILIGENCE!!!
Only this time I’m using it in a negative connotation lol 


THE 5 RULES OF AN EFFECTIVE ELEVATOR PITCH


1- Identify The Problems (The Human Needs)


Once again, people care about themselves and the problems they have.
In order for us to be effective in our message, we first have to identify what those problems are.


Some Potential Problems:


Stock market volatility  
401k / IRA underperforming 
Paying high taxes 
Slow road to retirement 
Lack of investment options 
Lack of passive income opportunities 
Lack of time to learn / acquire real estate
Risk of single family. homes 


2- Identify The Solutions 


Now that we’ve identified some problems, we need to identify the solutions we have to help!


How we can help them not only with survival, but with thrival!! 
(If that’s not a word it needs to be!)


Essentially, we need to answer 2 Questions 


What Do we offer?
How will it make their life better?  


We offer one of the best investment strategies in the world for…. 


Consistent returns 
High returns 
Stability 
Tax incentives 
Passive income
Etc


3- Keep It Basic, Clear, and Concise! 


Speed & Clarity matter! 


The human mind is wired for efficiency and effectiveness 


Which means along with focusing on the needs of others… 


We need to speak in the most basic language possible
And we need to wrap it up in less than 60 seconds!!


Think of your elevator pitch as a story, but make sure it’s a children’s story! 


4- Add a Call To Action 


Nothing else matters if they don’t know how to participate or respond. 


There must be a call to action!! 


5- Practice


Once again, practice makes progress! 


If you take the time to structure steps 1-4, and then practice it, you will see results. Period. 


ELEVATOR PITCH EXAMPLES 


Examples on HOW to answer the question of “What do you do?” 
Remember at the most basic level we’re answering these 3 questions… 


What do we offer?
How will it make their life better?
What do they need to do?


The quick version…


“We buy apartments with people who want to own and benefit from real estate without having to deal with the hassles. Do you invest in real estate?”  


The better options version… 


“Ya know, I was frustrated with how my retirement account, and the stock market in general, was performing so I started to explore other options. After a bunch of research I realized that you could invest in apartment buildings that had better returns, more stability, and better tax write offs. I couldn’t believe the difference, which made me super passionate about it, so I dove in head first! Now, my company provides those opportunities to normal everyday investors like I was. So, if you know anyone who is in the same boat as I was, let me know. I’m more than willing to help!”  


The together we can do more version… 


“We realized that the majority of people wanted to own real estate and knew there was huge benefits, they just didn’t know how to do it. We knew how to do it, but we also knew the best investments were big apartments, something very few people can buy on their own. So, we found a way to combine efforts. We do all the work and invest a portion of the money, but we allow other people to participate by investing their money as well, which means together we can buy the biggest and best investments. We’re always adding new investors if you’re ever interested.” 


The Robin Hood version… 


“Have you ever seen Robin Hood? Well, I didn’t have any problem with the rich, and didn’t want to steal from them, I just wanted the same opportunities as them!! I realized that super wealthy people, to no fault of their own, had access to investments that regular people didn’t. So, I found a way to participate in those investments and created a company that helps other people do the same thing! How do you typically invest?”   


The single family to multifamily option…


“Have you ever seen those TV shows where people buy run down homes and then rehab & flip them for a profit? Well, we used to do something similar, but realized that it didn’t provide the security & passive income our investors wanted. So, now we buy apartment buildings that provide more security & more passive income for investors. Have you invested passively in real estate before?  


The step by step version… (people love steps!)


“The average investor struggles to own real estate because they don’t have the time or know how. My company does all the time consuming know how stuff for them. First, we find the best apartments in the best areas. Then we give investors the opportunity to invest passively in those apartments with us. After that, my company manages everything and we split the cash flow with investors. Lastly, we focus on strategies to increase the property value, sell it for a profit, and then do it all over again on a new deal so investors don’t have to pay taxes on their profits! I can send you the next opportunity if you want to see how it works.” 


The short story version…. 


“I buy apartments with investors. For example, suppose you have some money and you want to invest that money into real estate, but you don’t know how to identify a good property and don’t necessarily want to be a landlord. Basically, I would do all of that for you so that you could benefit from real estate without dealing with the hassle.” 


The longer story version…. (This is my favorite go to option and is EXTREMELY effective!!)


“Well, suppose you have some money and you want to invest that money into real estate, but you don’t know how to identify a good property and don’t necessarily want to be a landlord. My company essentially does all that leg work for you so that you could benefit from owning real estate without having to deal with any of the hassles. We would partner your money with other investors and oversee everything from finding and buying the property, guaranteeing the loan, creating and implementing the business plan, and then eventually the sale of the property. This allows all of us as a group to buy the biggest and best properties, primarily apartment buildings, that none of us would be able to buy on our own. We don’t have any available spots currently, but I can keep you posted on future opportunities if you would like.”


CONCLUSION… 


Most people are pretty decent and defining what they do… 
But very few people take the time to define How, What They Do, Benefits Other People. 
So, remember… don’t tell them what you do… 
Tell them how what you do will make their life better!!! 
Lastly, be proud of your business!! What we do is amazing!! 

The 5 Steps To An Effective Elevator Pitch

Mindset: 6 Things That Will Make You Fail

Mindset: 6 Things That Will Make You Fail

Take Action: Write Out An Elevator Pitch

TAKE ACTION

1. Sit down & write out your elevator pitch 

  • Remember to use the 5 steps 

2. Practice saying it out loud 

  • In the mirror
  • To a spouse, parent, friend, etc 

3. Go strike up a conversation with a stranger and test it out!! 

  • Please make sure to not eff it up
  • Kidding…. go have fun! It’s a conversation! Don’t overthink it!!! 
  • But seriously, don’t eff it up. 😉

SUBMIT

Submit your written elevator pitch for coach feedback.

Week 3 – Day 5: Building Your Investor List

Building Your Investor List

Building Your Investor List
INITIAL INVESTOR LIST


Alright, let’s talk about building your initial investor list! 
I’m a huge advocate for starting your initial outreach with your friends and family. 
Don’t tell me “they don’t have money” either, because you have no idea what they have. 
These people already know and trust you and are probably interested in what you’re working on! 


EXPORT YOUR LIST


The first step in this process will be to export your existing contact list into an excel file or CRM of your choice. 
We have a resource for you, but if you create your own make sure to include the following fields 


*First Name
*Last Name
*Email
*Phone
*Notes


Investor Contact List 


Contact in your phone
Contacts made at networking events
Contacts who would probably invest
Contacts who probably wouldn’t invest but might know someone
Friends & Family members who would appreciate insight into your life


I Realize This Might Be A Mental Hurdle For Some


Don’t worry; you’re not going to be spamming anyone. 
Once again, we provide opportunities to those who want it! 


I’ll outline the initial email.
Which will Require an Opt-In before sending any investment opportunity.


INITIAL EMAIL OUTLINE


Here’s How You Need To Position Your First Email 


Should eliminate any fear of spamming.


Hey [insert first name], 
“I hope you’re doing well. I wanted to let you know that I recently joined [insert company name] and will be working with them on their next project. [Insert company name] is a real estate investment firm with more than 10 years of experience and $100,000,000 under management. Our main investment focus is on multi-family apartments. You can find out more about our firm here [insert link to website]. 
There isn’t an investment opportunity at this time, but are you interested in being on our investor list in the event we have a deal that fits our criteria? I won’t be constantly emailing you, as we’ll likely have three or four offerings this year.”


What It Accomplishes 


Establishes that you’re working in the RE sector.
Can’t expect them to know unless we tell them.
       
Partnership with experienced team with track record of success


This way the focus isn’t on your expertise (which is limited).


Opens door without pressure


Made it clear there’s no opportunity currently available.
Alleviates pressure on you and them.


Shows that good deals are a rarity


And that you’re in the know!
Increases credibility .


Gives them agency to authorize


Putting ball in their court is a power move

Investor Email

Mindset: Reading Attention

Take Action: Build Your Contact Database

TAKE ACTION

1.  Create your contact database

2.  Draft & send initial email to contacts  

3.  Post on The Multifamily Mindsetter Facebook page about something you’ve learned this week!! 

SUBMIT

Submit your contact email template here for feedback from our coaches.

Week 3 – Day 6: Internal Teams

Overview of Internal Team Members / Employees

Mindset: Confidence

Take Action: Plan For the Week

TAKE ACTION

1. Plan out the roles and team members you envision adding in your business.

2. Plan for the coming week!  

SUBMIT

Submit your list of roles and team members.

Week 3 – Day 7: The Day of Rest

Take A Rest

TAKE ACTION

Take A Rest

  1. Write down 3 ways you grew this week
  2. Share this list on FB on The Mindsetters Group

Plan For The Upcoming Week

  1. Plan out the upcoming week
  2. Review the previous days if necessary
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