EP NNA 112 – Finding Investors To Fund Your Deals: The Steps and The Marketing Tools Used

NNA 112 | Finding Investors

NNA 112 | Finding Investors

 

Are you looking for investors to fund your deals? How do you get people interested in becoming passive investors with you to fund your deals? In this episode of Note Night in America, Scott Carson breaks down the best ways to find, connect, and close investors to fund your future deals. He shares how he uses LinkedIn, meetup groups, and the County Appraisal and Recorder’s website to identify investors. Scott also shares the systems he uses to follow up with these contacts to build relationships and close them using the five-touch approach. He also discusses marketing tools you need to create, including a website, pitch deck, executive summary, case studies, and postcards. Join him in this episode to get insights on how you could find investors to fund your deals!

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Finding Investors To Fund Your Deals: The Steps and The Marketing Tools Used

You will enjoy this conversation topic. If it’s your first time, welcome. We’ve been doing these calls for several years. It’s to prove something. Consistency builds a lot of great stuff. We’re always glad to do this with you. You go to our YouTube channel at WeCloseNotes.tv and catch everything. We do have our Note Night in America podcast. I’m going to upload quite a few of these episodes. That’s not exactly updated all the way, but you can catch a lot of the great stuff in the last years of most relevant stuff.

I encourage you to check out the Note Camp Podcast and the Note Closers Show podcast. We have so much information available for you out there. Make sure you check out our website for updated events, teaching, and things like that that are available for you to help you take your business to the next level. As always, you can go ahead and RSVP to every Note Night America for 2022 by simply going to NoteNightInAmerica.com, and that’ll take you directly to our Zoom link to RSVP. That way, you don’t have to worry about RSVP and make sure you attend.

If you have booked a spot, you will get a replay sent to you the next day. I’m glad to have you. We have lots of great stuff. We’re south of 500 people registering for the Note Night in America 2022. I never know what’s going to happen or how active people are going to be, but we were at 480 to 485 as far as people have registered for 2022. I’m honored that you guys keep showing up. You keep showing up, and we’ll keep rolling this information out for you.

We had our Note Weekend class. It was a great insight. There were lots of great people there. I struggled through a bit of a cold, but we got it done. We spent a great hour on the last session of the day there, breaking down a tape with 73 assets. If it’s your first time to Note Night in America and you want to learn a little more about investing in notes, I would check out NoteWeekend.com. When you get signed up for it, you get a ticket to the next live class on the third Saturday of the month and the replays of the class. If you missed a Saturday because of family stuff, don’t worry. Get signed up at NoteWeekend.com, and we’ll send you the replays.

Raising Capital

Let’s get into the meat and potatoes. We want you to take some action. One of the number one questions I get when people reach out to book a call with me by going to Talk with Scott Carson is always about how to raise capital. It’s always, “How do I find investors to fund my deal? How do I get people interested in becoming an investor with me passively to find my deals?”

Whether it’s one or more, it’s all about the relationships and building a rapport. We’re going to talk about the key steps to finding people. That’s the first thing. You need to have a deal or case study, past studies, or somebody’s deals or case studies. That’s one of the great things we’ll get into. Let’s talk about the past and what we’re doing now.

Most people are going to your local REIAs and Meetup groups. I’ve done that for years. When I’m out of town, if there is a local REIA meeting, I’ll go to it if I can. I don’t go too much locally in Austin because we do so much more outside the state. We don’t buy up here in Austin, Texas, but we do in other areas. It’s still worth going to your local Meetup or Real Estate Investment Club or Association. If you’ve got a REIA that meets live on a regular basis, that’s good to go to.

Many of these will have a “haves and needs” session before they get into the main content. “What do you have? What do you need?” What’s sad is that a lot of people are scared to get up and pitch their deals. They’re scared to get up and talk. You could post on social media. A lot of these meetup groups also have groups, but we all know that Facebook is a bit of a dumpster fire.

You don’t see a lot of activities because people are tired of Meta. When you do posts, you’ll often have a lot of trolls that will get down there. People are a little shellshocked to sell their deal. By selling their deal, you’re not bragging. I want you to know that. You are sharing what you need. That’s the whole point of haves and needs. People are looking for deals. You can’t be a secret agent or a James Bond as a real estate investor and expect to raise capital.

If you want to do big things in 2022 and beyond, you’ve got some big goals. You need not wait until you close your first deal to start raising capital. You need to start marketing for capital now. People are scared because they need to prove the concept, which is a bunch of crap. That concept works. It has been around for a lot longer than you and I have. People are nervous about what to say because of their lack of experience. What do I say when somebody asks me how many of these deals I’ve done?

Ladies and Gentlemen, people don’t hire you to sell a house. They want you to be a realtor if you haven’t sold 100 houses. They work with you because you have vendors, a team, a broker, and someone that can help walk you through and sell thousands of properties. You may not realize that you have that. You do have a network of investors to help you. You have vendors, your servicing company, attorneys to foreclose, and your insurance companies. “This little guy right here has closed thousands of deals as well. He’s here to help you.”

Some people like, “I want to use my own money.” I get that, but at some point, you’re going to run out of your own money sooner than later. You’re going to sit there and be needing to raise capital to make things happen. That’s the first kiss of death. That’s great, but if you only got $5,000, $10,000, or $20,000 in the bank account. Your brain automatically shuts down to seeing and doing bigger things. That’s the past. We don’t want that.

You have to realize that in your conversations, when you’re talking about your deal or sharing it, you may be talking in front of 20, 60, or 100 people. The whole idea of sharing what you’re doing is to get into those one-on-one conversations if you know your deal, the benefits of it, and what could go wrong. Most of you are smart enough to figure that out. Most of you are smarter than 99% of most people out there.

NNA 112 | Finding Investors

Finding Investors: You need not wait till you close your first deal to start raising capital. You need to start marketing for capital today.

 

It’s knowing what’s going on with the deal. If you don’t understand the deal, somebody asks you a question. “Let me check into that, and I’ll get back to you.” The only way you get better at having conversations with investors is to have more conversations with investors. You might as well start now. You work with somebody who can coach you through it and get rocking and rolling.

Here are some of the things that we like to help our students with. We’ve gone through some of the stuff on previous webinars. If you’re part of our WCN crew, you’ve got access to some of the stuff here as well for you. You’ve got to have some things out there to get rock and rolling. You need a website of some sort. It can be a one-page landing page, and you need to have social media profiles. I joked with some of my students. We had a coaching call with my WCN crew and went through some LinkedIn profiles. Some of them were great. Some were horrendous. There was nothing on them.

They hadn’t posted anything in six years. You’ve got to have a LinkedIn profile where you’re sharing something regularly, and Facebook accounts secondly. You need to have a YouTube channel because you probably need to start embracing that aspect of sharing your story or case studies. You got to have an email account like Keep.com or worst-case mail, something to communicate with your audience. You got to have a website that is your mothership where people go back to see who you are.

You got to realize this. If you’re raising capital, finding deals, or trying to get deals from asset managers, the first place that people can go off at times is going to your LinkedIn profile. It’s your website or vice versa. I don’t care how experienced you are or the lack of experience you have. If you have no experience and haven’t done any deals, you need to talk about your vendors and their experience. How many modifications has your attorney done? How many modifications or lows are your services dealing with?

They’re the big heavy lifters in the note business. It’s not you. You need to know how to fund and break down a deal and direct your vendors to do that. That’s why we often talk about your team of vendors, your experts, and people that are looking at your deals and help hold your hand. You got to have an executive summary. You’re going to have people say, “Tell me about your business.” You’re going to tell them about your business, but they’re going to forget about it.

Do you know what we do? We have an executive summary that we go out to events or stuff like that. If I’m talking with investors or IRA investors, we’ll send a copy of our executive summary. It’s a one-page thing that talks about you and our focus. The one thing we also like to do is make this simple. We want our deals that make sense. We want to share deals or case studies. You got to have something that makes sense, past or present case studies or deals.

These are the types of deals that we do. When we’re sharing it with investors for the first time, and they’re thinking about potentially funding us, we’ll talk like, “We buy performing notes, nonperforming that can lead to performing, or if they don’t turn up performing notes, we look to foreclose or do a lease.” You need to have 3 or 4 case studies and talk about the exit strategy. We’re not talking 30 years. People can invest in it because what they think when they hear about buying a mortgage is 30 years. It’s short-term, 24 to 36 months.

This is why it makes sense. Everybody that wants to do this long-term needs to put a simple pitch deck together. A pitch deck is a PowerPoint video going through 10 to 15 slides about what your businesses are, your focuses, and the types of deals you do. It talks about your vendors, your executive summary, and deals that make it, all pulled together in 10 to 15 minutes, max. It’s on YouTube, your LinkedIn, or your website that helps people and you raise capital.

The whole goal of having these things together is to help you start connecting with investors. More importantly, it’s to help you stand out from the audience and from everybody else out there that’s not doing anything. If you do these couple of things, it’s going to help you attract honey. It’s going to help you attract investors like, “He’s got a logo. She’s got a website. What is this? It’s a video talking about their business. They know what they’re doing.”

Wait until you have a deal or need funds. Most people wait until they have a deal. They scramble trying to find funds, or they’ve used their own money. Now they don’t have any funds. They haven’t put these things together and they give up. We don’t want you to do that. You don’t have to do that. Investors can tell when you’re desperate, or when you need deals. That’s when they start looking at things like, “This is your first deal. You’re desperate.”

This is how you’re going to react. The whole idea if you’re talking to investors is to act as if you don’t need it. “I’d love to have your money, but I’m not desperate. These are the types of deals that we do, but I’m not desperate for your funds because there are a lot of opportunities.” He who has the gold makes the rules. You can either hold the gold in the deal flow and make the rules, or you can be desperate and need the funding, and they’re dictating terms.

I’m a big believer that you have the ability, especially in this world with the craziest inflation and lack of deal flow. In a lot of cases for traditional investors, we, as note investors, see a lot of stuff. You don’t have to sell yourself, your business, or your deal in a desperate aspect. You can be in a power position and start taking things to the next level immediately. Don’t wait until you need it because then it’s too late.

Where To Find Them

Where do you find investors that are going to fund your deal? You can go to self-directed IRA meetings or clubs. There are literally 50 plus different IRA custodians and trustees across the country. Some of them will host stuff weekly, monthly, or once a quarter. There are a variety of different things you do. That’s not a bad place to go. The thing about it, when it’s an easy network event like that, you often have a lot of people that are looking to raise capital just like you can. It’s not often very cheap money. Often attending in person is great. The whole goal with going is not to try to sell them there on a deal over a glass of wine and cold sandwich.

NNA 112 | Finding Investors

Finding Investors: Some people want to use their own money, but at some point, they’ll run out of money sooner than later. Then they’ll sit there and need to raise capital and make things happen. That is the first kiss of death.

 

It’s to build relationships and honestly grab cards. It’s to meet as many people as you possibly can and schedule them in some fashion afterward. Adam’s on your email list. You can mark him later on. If you don’t want to go networking because you’re scared of the world of COVID or you’re in an area that doesn’t have a lot of regularly scheduled events like that, jump on LinkedIn and do a search. If you typed in SDIRA investor, there’s going to be over 370,000 people that show up as self-directed IRA investors. I looked a few minutes ago to update my number. Do the same thing, SDIRA investor for Oklahoma, Florida, Utah, Ohio, or wherever you’re located.

Start connecting with investors in your state there. Do a search and say what I say, “Scott, I’m a real estate investor here in Utah, where we live. I love to connect with other investors here locally. I just want to talk. If you’re looking for stuff, I’d love to find out what you’re looking to do.” You can automate that process with Octopus CRM. You can pull over 1,000 profiles at a time on LinkedIn into Octopus and customize that through merges and field merges to make it sound and look like you’re personalizing, which is what you are doing.

Octopus is going to work well with LinkedIn. LinkedIn is the hottest social media profile. It is business. You don’t have as many trolls on there. Start sharing what you’re doing. It’s a business profile. Start adding value by sharing articles or case studies. It’s something you’re doing on a daily basis. Only 3% of people on LinkedIn post something on a daily basis. If you do something with articles, you will add followers pretty fast.

My favorite way, and a lot of times that we teach, is to jump on the county appraisal websites or the county recorder’s websites and do a search for folks that either own property out of their self-directed IRA or have lent money out of their self-directed IRA. Most counties allow you to search by the IRA custodian’s name, like Equity Trust or Quest Trust. Some states like Maryland, Virginia, California, and Arizona won’t let you search by a generic name like Equity Trust. Why do we search by Equity Trust or Quest Trust? If somebody has used their self-directed IRA to fund a purchase of the real estate, like a property, that’s how it has to be titled at the county.

Making A Warm Connection

Using money out of their IRA, it’s usually be titled that of the deed search to the county recorder’s office. These are the easiest conversations you’re going to have for the most part. If they’ve pulled the trigger, we know they bought or funded deals, and you’ve got several things in common with them. What are those things that you have in common? It’s a warm connection. It’s not a cold connection. Some people shy away from talking to these people because all their investors are writing. They’re going to want a high above-average return. Not always.

They may have owned that property for a couple of years. They may have money sitting in their coffers, their checking, savings, or other accounts that are losing value. You have to start the conversations with them. The things that you have in common with self-directed IRA investors are these. First and foremost, they’re real estate investors like you. As real estate investors, we’re a little bit more flexible with working with new people. We often start off the same way, funding one deal and working to find other investors.

Real estate investors are going to be friendlier. We needed somebody to call. We know that they have money to invest. Why? They’ve already used it. They’ve disclosed it by the fact that it’s an IRA transaction. I’ve never found a real estate investor who wasn’t looking for more deals to fund. They want to put every dollar to work as best as they can and get it out there. It’s sitting in their accounts making 0%. They’re not making money. They’re more like losing money. You have to understand that’s a positive. If you bring a deal that makes sense to them, that’s not long-term. We’re talking less than three years. You could probably fund it.

The biggest thing is this. They’ve also pulled the trigger. This is not trying to convince somebody who’s never pulled the trigger to pull the trigger with you. I’m always amazed when people are like, “I’m going to reach out to this group of people out there that haven’t done any real estate.” We often want to work with our warm market. I get it. They’re our friends, families, colleagues, or people around the water cooler.

If we’re working with people who are trying to give it to us around the water cooler to fund a deal with us, they don’t see us as the real estate investor mogul. They see us as Larry Hoffman, the IT guy. They see us as Jessica, the social media expert, not the real estate guru. It takes a little bit of time to help overcome those objections. Why are you doing it? Are you trying to sell me something like Soap on a Rope?

Those individuals who aren’t in real estate are not with a self-directed IRA. You’re going to have to teach them how to invest. You have to teach investing to these individuals, and you don’t want to do that. You want to work with people that are familiar with deals. That’s why you want to start with a warm audience of people who understand it, have money, and are ready to rock and roll and pull the trigger.

If you’ve got to go to your warm audience who’s never done anything, it’s going to be a rocky road to raising capital. Oftentimes, you’re going to be hurt the most when those people don’t flake. When they do flake on you, they don’t fund your deal, so don’t do that. Trust me. You’re going to start building or want to start now with a warm market that’s going to help you out. You can raise money from friends and families. I get that. I’m talking about that.

That’s going to be the easiest thing, but you also need to start connecting with other investors out there who are ready to pull the trigger and want to fund your deals. What do we do here at WeCloseNotes.com? What do we do here to come to raising capital for our deals? First of all, we do spend a lot of time on LinkedIn. I bring this up because we do it on a regular basis. We use Octopus CRM that was connecting with 100 note investors with them automatically.

I was connected with directed IRA investors. We use Octopus CRM to automate it, but you don’t need to pay that $21 a month or $22 a month. You could go out there, look for it, and start sending out connection bikes. “John, I’m a fellow REI real estate investor, and I’d love to connect with you and other investors in your area. I’d love to find out what deals you’re looking for as we come across different types of deals all the time. I’d love to connect and talk.”

NNA 112 | Finding Investors

Finding Investors: If you’re raising capital, finding deals, or trying to get deals from asset managers, the first place people can go is your LinkedIn profile.

 

You email a phone number or Calendly, very simple. When they do connect, follow up with a personal message, “Thanks for the connection. Would you be able to jump on a quick call to connect and share more about what you’re looking for? If not, no biggie. Here’s an article that you might find in your market, depending on what you’re investing in.

You may want to have something available. “Here’s a little bit about what we do. Here’s my pitch deck video. Here’s a case study that we closed on. Here’s an article about note investing. Here’s a blog that I wrote. Here’s a podcast that I appeared on.” It’s sharing a little bit more about what we do. This is not meant to be a rocket. It’s literally using one thing again and again. You can use a two-minute pitch video talking about what you do. “Thanks for connecting with me. I appreciate it. I love networking and expanding my network of investors across the country.”

Get in the habit of taking that next step. We all get those LinkedIn invites where it’s, “Buy. I’ve got a perfect job for you,” even though you’re not that interested anymore. I have twelve of those now. That’s not what I’m looking to do. “You’re an investor. What type of deals are you doing? I’d love to connect with you.” Talk about the market and go from there. Thanks for the connection. “Here’s a little bit more about me.”

That’s one step with LinkedIn. Anybody here could do this. This doesn’t cost you anything. If you want to go with Octopus CRM to help you automate it, that’s $21 a month or something like that. Maybe you can do this individually at night on your basic profile by connecting with investors. That’s the first part. We’ve been doing that for years. That’s why I’ve got 27,000 on the way to 30,000 followers in LinkedIn connections now.

It’s All About Them

The second step is not that much more advanced. It’s also going to be the biggest bang for your buck when it comes to raising capital. You can hit that cha-ching when you do this right. If I have people that I connect with and they’ve given me their email, clicked on something or something like that from LinkedIn, I’ll send them a copy of my eBook and add them to my email list. “If you want to schedule a call in my calendar, let’s talk.” We’ll do a Zoom call or a quick phone call to chat with somebody. I had conversations with two investors to talk for 5 or 10 minutes. I asked them about what they do or what they’re focused on. I always make it about them.

They’re like, “Tell me about what you do.” “This is what I do.” “That’s interesting.” “I’ve got an eBook that I wrote. Would you like to see it?” “I’d love a copy of it.” “Here you go. I’ve got some case studies that we did. Would you like to see it?” In the case studies, you know what everybody says, “Yes.” Nobody says no to that. They’ve opted in and given me their address where I can find it. I will send them a thank you. “It was great talking with you.” It’s a little touch. “Thank you for meeting with me.” If I don’t have their email address, I pull out my smartphone and record a short 1 to 2-minute video and send them that via text.

It’s little things to do. If I can, I like to send out thank you letters. It’s always a nice little touch, but it will help you stay above and beyond what most people are doing. Now that I’ve connected with them through Octopus or LinkedIn, I’ll share articles, videos, podcasts, and episodes along the way with case studies. I’ll do this on a regular basis. I’m planning out my touches. You want to set realistic expectations.

You have to understand this. You’re not going to send out one email or do one marketing piece. Suddenly, you’re going to be bombarded with 100 people with their IRA checkbooks ready to rock and roll. It doesn’t work that way. You have to market it and touch base with them. Honestly, they don’t know you from anybody. If you’re trying to work with people in the same industry that you are, that’s an even longer road to hope, but you can deal with investors. It takes them a little while to start to recognize you. “This guy always posts pretty good stuff. I liked that article.”

Maybe they don’t read everything. The thing is, if you start doing this, you’re separating yourself from the 97% of people who don’t do crap on a daily basis. You want to find success. That’s why you’re here with me. That’s why you’ve been on Note Weekend. You show up on a regular basis to take action. You want to find success. You determine your success by doing these things on a regular basis.

When we sent the letter to IRA investors, somebody asked me what the letter said. It’s pretty simple. Keep It Simple Stupid, KISS method. We’ll talk about what we do and who I am. We talk about why I am contacting them. If I pulled their information off the county records, I told them, “Why am I contacting you? It’s because you bought a property with your self-directed IRA. I’m assuming that you’re a real estate investor. I would love to talk because I am also a real estate investor who comes across deals and looking for people like you to sell my deals to or potentially partner up with in some fashion. You fund it, and we take it down. That’s why I contacted you. I’d love to talk with you.”

Here’s a great letter from one of our students. We helped Donald Ellington write this. He’s out of Maryland and retired from the military. It is basic, simple, “Hello.” It would mail merge that person’s name. “I came across information that you might be a real estate investor looking for deals to put your lazy assets to work. My name is Donald Ellington. I’m a managing member of Trinity Clear Choice, LLC, which is a real estate company out of Maryland that’s focused on buying and investing in distressed real estate mortgages. We’re going to write investors who are looking for an above-average return on the funds and their self-directed IRA or savings accounts.”

“I’ve been an active investor since 2018. I’ve retired from 30 years in the military. We focus our attention on working directly with a network of banks to buy their distressed mortgages, non-performing first liens in real estate, or single-family homes at large discounts. Why am I mailing you this later? We were always looking to partner with other investors to help us take down more deals at bigger discounts. If you are interested in finding out more information on how we work with other investors like you, feel free to shoot me an email or give me a phone call.”

He sees this information. “I look forward to hearing from you,” and we put Donald’s smiley face at the bottom. He’s a great guy. “PS. I put my photo on this letter to let you know that I’m a real person with real deals.” I created the logo in Canva. We tweaked the letter that we have in our manual for our three-day workshop. We sent these out, and you get phone calls. People will call you. You send 50 letters out. You probably get 2 or 3 phone calls immediately in the first couple of days. We’ve seen this type of letter. When you combine it with an executive summary and one picks a little about what you’re doing in a case study or two, it has succeeded.

NNA 112 | Finding Investors

Finding Investors: He who holds the gold makes the rules. Now you can either hold the gold in the deal flow and make the rules or be desperate and need the funding while they’re dictating the terms.

 

You will get people that call you. Besides this letter, here’s it in big, bold print. It talks about what he had done. He’s been 30 years in the military. Thirty years in anything is going to build success for him. He’s been investing for four years now. He sounds a lot like me. I’m looking for opportunities. I’m looking for deals in this market. I love to talk with this guy. You can also do postcards. This is Dimitri, one of my coaching students. He took a picture. He sent them out. What we tell you to do is send these letters out that look nice, like party envelopes. They’re multi-colored.

The one thing that’s not on here is Dimitri’s return address. Put the return address of who you are. I also like to tell people, “Put it in a plastic envelope and take some of your favorite smelling perfume, smell good, and squirt a few sprays into the bag, so it smells good.” When it comes to the mail, you’re like, “This smells good.” You got to be careful there. It will get people to open it, but you want to make sure that nobody’s getting punched like, “Why are some girls sending you a letter with perfume on it?” This works. It gets people to call.

This is from many years of marketing experience and coaching from some of the best in the game, Roland Frasier, Jim Rohn or Brian Tracy, and all sorts of people out there that I’ve learned these little tricks from. This is the only direct mail that we do. You’re not talking about dropping 1,000 postcards or 1,000 letters. We’re talking about 50 to 100 IRA investors. You can send a postcard. It’s pretty simple. This is what the front of my postcard looks like. I buy these in bulk from Postcard Mania. We’ll have them on a podcast here soon. We buy these in the bulk of the other side. It’s got my contact information.

This is the second step in sending a letter. The first month, a couple of weeks later, we send a postcard on the backside. “We closed on this deal. We’d love to talk with you. Make sure you got my information.” Larry took it a little different. He took the letter and put it on the front of the postcard, which I thought was genius. He put his photo. They put the little caption, “Scan me.” If you scan this, it’ll take you directly to his website. Let me do this.

I hadn’t planned on doing this, but I’m going to do this. Let’s pull this up. If you scan it, it should take you straight here to LGHInvestments.com. It’s a one-page website that is ten-minute pitched equity. It’s pretty simple. Let’s talk about the types of deals. It talks about his vendor team. He gets a couple of case studies, what they’re looking for, and their focus. I loved the six important things that they do to protect their investors. We go back here. That’s on his postcard.

People who don’t know are scared of scams. That’s fine. On the opposite side, it’s a little bit more information. It’s a picture of a deal or two. Here you go. “Scan with your phone or camera,” tells them what to do. He’s also put pictures of case studies on the back here to help people understand some things and this works. Larry’s done a good job setting down letters and postcards and raising quite a bit of private capital, giving pledges for it. It is not difficult.

Kudos to our buddy, Paul Riley, who closed on his first deal. What did he do? This is the front of his postcard. He does the same thing. “Get your IRA working again. Privately land through your IRA for steady returns to convert real estate. We find that. Manage the deal. You provide the capital, fund the deal, and get an above-average return on your money.” He puts three pictures of properties. The Kalamazoo, Michigan house is a deal that he’s closed on. He also put a picture of a previous deal in Charlotte and Columbus, Georgia. It’s the same thing. You scan it. It takes you to a website with his pitch video. It gives you his contact information, which is not bad. This is on the backside of it.

Most people have capital, opportunities, time, or experience or invest in real estate themselves. This is a powerful statement. He put his logo and signature on. You scan over his signature and put it. It goes out to people on his postcard. He’s doing 20 to 50 a week. He’s raising money for it. It’s easy to look at. The question is, “It looks expensive.” It was not expensive. If you had a deal that was going to pay you $20,000 on a note deal, but you didn’t have the money, how much does that deal costs you? $20,000.

If you sent out 50 letters, it might cost you $1.50 a piece to send out a letter. For 50 letters, how much does that cost you? $75. You decided to be cheap, but not send out 50 letters. You do a little bit of work, an hour of work to pull these lists off their records, and then follow up another hour, put together another hour to order postcards for Vistaprint or something like that. That’s about five hours of your time to design and market them. That’s $75 at $15 an hour. You are setting 50 letters at $1.50 apiece. That’s $75. $150 is stopping you from making $20,000 because you only need one investor to reach out to you. He will fund a deal at $25,000 or $50,000 but, “I don’t want us a letter, Scott. I don’t want us a postcard.”

I create this simple pitch deck slideshow, ten slides that are 20 minutes long in 30-point font, and record yourself giving your pitch like Larry did before in Note Night in America. We’re talking 10 to 15 minutes at the most. You may be up to $20. It’s best to keep it at around 10 to 12 minutes. You’re talking about your business, your focus, your vendors, your teams, and how you can help them. You record it to video through Zoom or something like that. Upload it to YouTube, your website, and LinkedIn. Share it on your platforms. Share the short video to your LinkedIn connections when you send a connection out, your Facebook groups, or your LinkedIn groups.

Go to BiggerPockets. Put a keyword search for $50,000, $75,000, or $100,000 because people are going on LinkedIn, BiggerPockets, or Facebook groups or connecting to investors saying, “I’ve got $50,000. What should I do with it? I got $100,000. What should I set up a connection about?” “I saw that you said that you had $50,000 to invest. Here’s what I do. Maybe you might be interested. We could partner in some deals.” Share it everywhere on a regular basis. Once a month, you probably should go back and repost it to LinkedIn and Facebook groups because those things get bombarded a lot of times and stuff. You need to reshare it on a regular basis.

Remember, not everybody’s sitting at their computer waiting for you to send something. How many investors do I need to make this happen? Direct mail has a 1% to 4% response rate. That’s a cold generic response rate. If you’re sending it to a little bit warmer rate, you’re going to see somewhere between a 10% and 25% response rate. That is what we’ve seen because you’re hitting them hard with a deal. If you pull a list of 200 self-directed IRA investors from county appraisal or county clerk, you could do that in minutes. Honestly, you could do that all very quickly. A 10% response rate equals 20 investors.

If you talk to 20 investors in only a 25% conversion rate, roughly less than it, you’re going to talk to 4 investors. That’s about 20%. We know that 67% of investors out there have $150,000 or more in their accounts. If you figured that 67% of 4 people. It’s 2/3. We’ll figure it out. There are three people times $150,000 equals $450,000 and one that maybe has $50,000. With that alone, you’ve raised $500,000 in private money just talking to 20 people, and getting 4 people to convert with you.

NNA 112 | Finding Investors

Finding Investors: You don’t have to sell yourself, your business, or your deal in desperation. You can be in a power position and start immediately taking things to the next level.

 

The question is, what are you waiting for? Is $75 hurting your budget? If you’re on a tight budget, go and create a free PowerPoint presentation on Zoom for free. Download it and then upload it. It’s not that hard to do. You don’t offer an interest rate. You’re all trying to get the conversation going. Here’s the magic formula to getting low-interest rates, where you’re only borrowing money at 6%, 7%, or 8%.

Ask him what they have invested in, in the past. “What have you invested in the past? Tell me about it,” and shut up. Too many times, we feel inferior and have to talk over people. We have to interrupt them. Ask them questions and shut up and listen. If they tell you that they’re in a CD, certificate of disappointment, or a 401(k), they’re probably getting a low return on investment. Savings again, you’re definitely getting low. You’re losing money. We all know stocks and Bitcoin could be hit and miss. It’s feast one day, famine the next. If we know that we don’t control what goes on in the stock market.

If it’s real estate, they’re a little more aggressive. They invested in real estate. Have you done anything in the last year or two? They did it continuously and are doing it on a regular basis. They’re going to want probably a 10% to 12% return. That’s okay. They may not be the right person for you. They may be if they’ve got money sitting in silence and know they need to do something. They’re looking for returns. If they’ve done one deal the last few years, “How did that go for you? You made 12%. You did it for how long, six months? Did you do anything else for the next six months? No? You only made 6% annual interest. I could give you that.”

Real estate investors are more consistent with double-digit returns if they’re active. There are plenty of people with self-directed IRA accounts out there not doing anything but they’re wanting to do something. They don’t believe and go and buy a rental property or invest because they only got $50,000 in IRA. They don’t think they could go do those things. For the most part, they understand it’s out there, but they don’t understand it fully yet. Ideally, you guys can be buying something at a huge discount. It gives somebody a decent return on investment, and they’ll love you.

That’s one of the big things. “How did that deal go for you? How did it turn out for you?” Shut up and listened. Here’s what you want to repeat after me. “If I could show you double and triple that for a short period of 2 to 3 years to grow my real estate, would you be interested? If there’ll be a 70% of fair market value or less, would you be interested?”

You’re going to come up with your own conclusion of not too long. “If I could show you double or triple that, you got 2% or 3% annualized. I can show you double or triple that for a short period of time or 2 to 3 years. It’s secured by real estate at a discount. Would you be interested?” They’re going to say, “Yes. I would be interested.” If they say, “No, I wouldn’t be interested,” “No problem. Thank you for your time,” and move on. If they say no, they’re being stupid. Move on, next. Take them off your list and keep marketing to the other people after. If they say yes, move to the next level. What’s the next level?

The whole idea of sending out an email, LinkedIn, or pitch deck is to get them to ask for more information. They’re going to say, “This is interesting. Where else can I find more information?” Once you know they’re interested, share with them a new deal or case study. This is what you’re going to say. “Here’s a deal that I’m working on. Are you interested?” They say, “Yes,” and then request. That’s okay. “This is the deal I’m working on. I’m looking to get this funded in the next few weeks. Would that work for you roughly? That’s great.”

Let’s move to the next level. Let’s lock you in as the investor on this if you want to. This is where you would then request for them to fill out an investor pro questionnaire, send you a pledge email, and a pledge letter, and provide proof of funds that they have. You must get all three of these. Require it from them in the next 48 hours. “I’ve got other people to meet with, but if you want to lock this up and get involved, great. Let me get you to fill out this investor questionnaire. Send me a bank statement to assure me you have this. Cross out the account number. You just need to show that have the funds and where the money’s coming from. We get it rock and roll for you.”

You can set up a lending agreement. We can go through the nuances of how you secure that investment. Either they’re in an LLC with you or their name is on the assignment. You put the equity from another deal on lien. There are a variety of ways they can secure it. You’re always going to use a self-directed IRA. You want to make sure it’s coming from a self-directed IRA because each IRA company is going to have its own set of funny paperwork that you’d need to figure out. Go from there, but help them fill out the paperwork and transfer docs.

If they don’t have a self-directed IRA, they’re using now, you would have to set a new one up. You hold their ends. The whole idea of this is to start the conversation. Get them to start talking with you. You can spend time on LinkedIn if you’re cheap. You can spend a little bit of money that’s going to have a big term investment if you do it at least a couple of times. With any type of direct mail, LinkedIn, or letter, you’re going to do a little time. You send out 50 letters. Send it out five times. That’s 250 letters. It costs you $1.50 a piece. $1.50 a piece times 200 Is $350. You’re not funding $25,000, $20,000, or $50,000. It all pays for itself for the full year. Going to the county recorder’s is simple to do. It’s something that we’ve done video time on these webinars for you.

This stuff works, ladies and gentlemen. You have to follow through and do this on a regular basis. Put some systems in place. We’re not sending 1,000 postcards. You pulled a list and got 50 people in your county. Send it to 50 this month, instead of 50 next month, in a few weeks, or several weeks later. Follow up. There are so many different options out there. If you have questions about that process, you’re always going to TalkWithScottCarson.com and schedule a call with me to discuss it. I’m going to share some concepts with you. If you look in our three-day workshop in our manual and stuff like that, we’ve got plenty of options for you, things that we use on a regular basis.

Make sure if you get a chance, go check out. If you’re not subscribed to our YouTube channel, do so. We’re a few short of hitting 6,000 markets. You go to a WeCloseNotes.tv. Hit the Subscribe button there, follow along, and be alert every time we upload a new video there for years, but help us hit that 6,000 mark. We’re pretty excited about that. Have great rest of your week. We’ll talk to you all later.

 

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