The Raising Money Toolkit
Essential Tools You Need to Start Raising Money for Real Estate Syndication
This toolkit has 3 main sections:
Part 1: Finding Investors
Part 2: Talking to Potential Investors
Part 3: Bonus Resources
Part 4: The Missing Piece
Part 1:
Finding Investors
Of course, to raise money, you have to be able to find investors. Once you've tapped out your personal network of friend and family, you need to be able to find new investors.
Below you'll find some great ways to meet new investors:
Multifamily Events
Going to live events is a great way to network and find potential investors, or even partners who are good at raising money. A lot of passive investors go to these events with the goal of meeting someone to invest with. It's good to attend as many of these as you can. There's nothing quite like meeting face-to-face.
But how can you know about all the upcoming events?
That's where our first tool comes in. We maintain a list of upcoming events hosted by the biggest players in the multifamily space.
Digital Marketing
Next to meeting in person, getting in front of people online is the next best thing. Think about it. Through the internet, you could reach all of the investors you will ever need. Everyone is online these days. All you have to do is get your message in front of them.
How do you get in front of the right investors online?
Our next tool will help you with that. It's a training on how to raise money through digital marketing. You can access it at no cost.
Build Authority to Attract Investors
Rather than chasing investors, it's much better to attract them to you. You can do that by building authority. While this is not a strategy for beginners, it makes sense to start working on as soon as you're able.
So what exactly does it mean to build authority, and how do you do it?
Learn that and more in the next tool:
Think Outside the Box
While it makes sense to learn from experienced syndicators and copy things they're doing that are working well to find new investors, it can also be good at times to zoom out and get creative and look for investors in places everyone else isn't looking.
To get your creative juices flowing, check out the next tool:.
Find Investors on LinkedIn
LinkedIn is a little different from other social networks, since it's business-oriented. It can be a great place to connect with passive investors.
We have 2 resources for you to help you be more effective in finding investors on LinkedIn:
Part 2:
Gaining the Trust of Potential Investors
Once you make contact with potential investors, what you say to them and how you present yourself will make all the difference in whether they want to invest with you. You could have the best deal in the world, but if investors don't like you or trust you, they're not going to invest.
Here are some tools and resources to help you make the right impression:
Work on Your Elevator Pitch
As you may know, an elevator pitch is a brief overview of what you do and the value you provide. The idea is that if you got into an elevator with someone and they asked what you do, by the time one of you gets to your floor and is ready to exit, the other person will be interested in working with you and want to know more.
Often when you meet someone, you don't have much time to explain what you do and make them interested enough to want to exchange contact information. If you leave it to chance, it's not likely to go well. It's important to plan this out in advance and have a succinct, compelling pitch that you practice so many times you can say it from memory. It should make the potential investor curious and want to know more.
Make Investors Eager to Work With You
If you meet a potential investor and they go home and search for you on Google, what will they find? Something that makes them excited to work with you, or will they get the impression you're a newbie, or worse, a scam artist?
Your online presence can make or break how investors perceive you. Our next resource will help with that.
Prepare a Sample Deal
How do you determine whether potential investors would be a good fit when you don't have an active deal you're working on, or especially when you're working on your first deal?
By having a sample deal you can show potential investors. If you haven't done your first deal yet, you're not saying this sample deal is one you've done. You're just saying, 'If I find a deal like this, would you be interested in investing?'
It's important to use the same type of deal you will be looking for, with realistic, conservative numbers. Remember, it's always better to under-promise and over-deliver. Plus, if your projected returns are too high it can actually make investors skeptical because it sounds too good to be true.
Michael Blank is a well-known syndication mentor and he has put together a sample deal for people to use. You can get that here:
Part 3:
Bonus Resources for Raising Money
Here are a handful of additional tools and resources for raising money. They didn't fit neatly into one of the categories above, but are very valuable.
Understand the Differences Between 506b and 506c and How It Affects the Money Raising Process
Depending on which approach you're taking, it can have an impact on the way you market to investors. Not understanding this and doing something you're not supposed to could be very costly.
Keep in mind that things are continually changing, so be sure to consult with a good SEC attorney before taking any action.
In-depth Interview about How to Raise Money
In this interview, we went deep on the topic of raising money. Here are a few things that are covered:
Exactly how to get cash committed before you have a deal lined up
The three capital raising steps to take right now if you’ve tapped out your personal network
Learn how to avoid common mistakes when raising money
Tips about Raising Money from a Live Event
We went to a high-end syndication event and took a lot of notes and typed some highlights and shared them in the link below. Even though the notes are a couple years old, most of the content is still very much relevant and helpful.
How To Keep Your Investors Happy So They
Will Invest Again And Again
We went to a high-end syndication event and took a lot of notes and typed some highlights and shared them in the link below. Even though the notes are a couple years old, most of the content is still very much relevant and helpful.
10 Lessons Learned from Raising a Million Dollars in 2 Weeks
Syndicator Dave Thompson shares his story about how he raised $1 million in 2 weeks for his first deal. He also shares the 10 lessons he learned from this deal.
The Missing Piece
To gain investors' trust so they are willing to invest with you
When you meet a new potential investor, what's the first thing they're going to do when they get home?
They'll Google you.
They're going to do their homework and see who you are and whether you're trustworthy.
A professional website can help you make a great impression.
That's where we come in.
Check out the demo to see how we can help you with this important step.
