February 7, 2024
Something I’m Reading
I’m currently reading "The Son” by Philip Meyer which could be considered a new classic American novel. It’s super graphic in it’s description of violence and terror in the American West but the writing is phenomenal and it’s an interesting look inside a part of history I hadn’t learned much about.
Something I Photographed
Quick trip to Oahu for a few hours! Island hopping is the best!
Something I’m Excited About
The REI Summit is right around the corner and I couldn’t be more excited! This year, we’re hosting it in Denver from May 3-5th. This is the most actionable, how to, real estate event for new and experienced investors. Early bird pricing is live so be sure to take advantage before prices go up and you don’t have to be a Tribe member to come! https://reisummit2024.com/
Something I Can Answer
I’ll be answering two questions asked by a BTB subscriber. Have a question you want me to answer? Reply to this text with your question!
Question: "What is the most important thing you learned from a mentor? ”
It’s not necessarily something they said, but simply by being around mentors who think 100x bigger than I do, I naturally expand the capabilities of my thinking. So it's more of an osmosis kind of a situation where I just learn from them naturally. If I want to get really specific, Ken McElroy who is one of my mentors, told me that I was overcomplicating my pitch to investors by giving them 500 pieces of data instead of just painting more of a picture of what Open Door capital can do. And I thought that was terrific advice. Investors don't necessarily want 500 pieces of information to make a decision. They just want to believe that you know what you're doing, that the deal is solid and that they're gonna make money on it. You don’t need to try and complicate it beyond that.
Question: "What tips do you have when it comes to raising capital from investors?”
Here are a few tips of how I've been able to raise money from over 1,000 investors at Open Door Capital.
1.) Present your deal well. People intuitively know "how you do anything is how you do everything." Be simple, clear, concise, personal, and polished.
2.) Only win if they win. For example, at ODC, even though we have some acquisition fees, I don't get them. They keep the salaries of my team paid, but I only win if my deals do well. I even donate my salary to charity. I don't keep a dime until my LPs win. They feel this.
3.) Focus. Too many people try to do way too much in real estate. Your potential investors can feel your scattered brain. Instead, seek to become amazing at one thing.
4.) Don't Do It All. I'd be nervous about investing in someone who tries to do everything themselves. That's just ego and fear. Find and manage a team of incredible people, even if you have to give up equity.
5.) Dig your well before you're thirsty. In other words, start building your knowledge and reputation now, for the money you'll need to raise next year. Interviewed over 400 people on a podcast, wrote 4 books, and attended 100+ real estate conferences before I ever raised private capital.
6.) Find the "needles." It's competitive out there. We have to underwrite hundreds of deals to land one for our investors. Be that person who has the systems and the fortitude to seek the needles in the haystack. At the end of the day, you have to have great deals to raise capital.
This Week In Lending
This week, let's unravel the potential within Debt Service Coverage Ratio (DSCR) loans. Understand how optimizing your portfolio with these loans can be a game-changer. Dive into the nuances of calculating DSCR, mitigating risks, and leveraging this financial tool to scale your real estate ventures. Empower yourself with insights that transcend the conventional, and position your investments for sustained success
.If you're interested in getting qualified for one of our 30-year fixed DSCR loans, text DSCR to (360) 580-4983 for more info or to submit your deal!
Something I Recommend
I was always envious of the people who are “ON” 100% of the time. The people who don’t deal with low motivation, doubt, fear of failure, or those endless days of thinking your whole entrepreneurial journey is about to blow up in your face. These people were running circles around me in business and real estate and when I finally figured out what they had that I didn’t – It all made sense.
These people were using a Mindset Coach to keep their eye on the prize and expose them to a higher level of thinking every single day. So when I went to find one of these coaches specifically for real estate investors, all roads lead to Jason Drees. Jason has been coaching me for nearly a decade at this point and has supported my growth from a small time investor to someone with nearly $1B worth of assets under management.
If you’re looking for an edge to accelerate your growth, talk to Jason. You can get a FREE coaching session through this link.
For my health-conscious friends (or those trying to be healthier), I’ve been using MyBodyTutor for years for accountability on my fitness and diet. These guys assign you a coach to hold you accountable, track your food, suggest exercises etc. You can check them out here.
Disclosure: “Some of the links in this post are affiliate links, which means I may earn a commission if you click on the link and make a purchase. However, please note that all opinions expressed here are my own and I only recommend products or services that I have personally used and found valuable."
Your Friend,
P.S. Comment below and let me know your thoughts on this week’s BTB! Please be friendly :)