Periodically, we like to bring you stories of real-life investors … investors who’ve been in your shoes and made it up rocky paths to emerge better than they started!
The investors on our show today all fell into real estate investing in different ways, but one thing brings them together … they all attended our Secrets of Successful Syndication event … and then turned their education into effective action by becoming successful syndicators!
We asked each guest to tell us more about how they got started, what happened when they ran out of money, and some of the setbacks and successes they’ve each experienced.
Behind the mics for this edition of Real Life Lessons:
- Your psyched-about-syndication host, Robert Helms
- His seriously silly co-host, Russell Gray
- Engineer turned syndicator, Sep Bekam
- The deal hunter, Peter Halm
- Self-storage empress, Linda Murray
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At some point, every real estate investor reaches a crucial moment where they have, for all intents and purposes, run out of money.
At that point, investors have two paths … they can take the path of least resistance and simply give up … OR they can harness their expertise and provide investment opportunities to other investors through syndication.
Syndication is a more effective version of “no money down.”
The truth is, there’s a ton of money floating around out there if only you have the right value proposition.
Syndication offers you the opportunity to build a big business with cash flow, long-term gains, and profit sharing … and all you have to do is find and broker decent investments.
You have the chance to create your own perfect life. Ask yourself … What do I want to get good at? What do I like to do?
Then focus on building specialized skills. You can’t be an expert in everything.
Syndication is like assembling a puzzle … you might only be a small piece of the whole (albeit a crucial one).
All of our guests today have taken the leap of faith into the world of syndication … let’s take a look at their stories!
From fear to freedom
If you met Sep B. years ago, before he started investing, it might be hard to make the connection between the shy, analytical engineer of yesteryear to the full-time syndicator of today.
When Sep started out, he had invested his personal money in two fourplexes in his own state. He had no business background and lots of fear about the unknowns of investing out of state.
“I was very motivated but didn’t know where to start,” says Sep. But Sep knew he had no money of his own left … and his family and friends were starving for yields.
So what did he do? It’s simple. Sep constantly looked for deals.
Six months after his first Secrets of Successful Syndication seminar, Sep closed on his first syndication deal.
Some of Sep’s major takeaways from his syndication experience:
- Match potential investors with their needs and wants. Sep found investors were more likely to come to him when he emphasized his team, put strong systems in place to protect capital, and crucially, matched investors and investments appropriately.
- Always be okay asking questions and learning from others. “It takes a certain level of curiosity to ask questions even if everything isn’t going right,” said Sep.
- Find ways to mitigate obstacles. Sep and his team ask everyone they work with a series of questions to preemptively make sure companies and investors are the right fit for Sep’s syndication business.
- Make small, controlled mistakes and learn from them. New syndicators will experience challenges along with success … and Sep’s certainly had his share of missteps. These days, he’s constantly fine-tuning, making sure he is adapting to changes, working with the right team, and offering the right product to tenants and a reliable source of passive income to investors.
- Transition gradually from part time to full time. Before transitioning, understand how much passive income you need, Sep advises. Then break your goals into actionable, realistic steps.
From house flipper to deal hunter
Peter H. started out flipping out houses in Los Angeles. It was slow, hard work … paychecks only materialized when houses were sold, and prices in LA started skyrocketing, making deals hard and hard to find.
In January 2016, Peter attended Secrets of Successful Syndication. A year and a half later, he’s on his fourth syndication deal.
Some lessons he’s learned along the way:
- Don’t tie yourself to one particular asset class. Peter’s deals have ranged from a mobile home park to multi-family apartments and currently to workforce housing. “If we discover a natural demand, we’ll jump in,” says Peter.
- Align yourself with people who have great experience and access to funds. When Peter started doing deals that were big enough to be uncomfortable, he made sure he put himself out there and recruited people who knew what they were doing. “Everything was an interview process,” Peter said. “We asked a ton of questions.”
- To build a network of prospective investors, listen to investor needs. By listening to people and discovering their wants, needs, and worries, Peter can file away what he’s learned until he finds a deal that fits a potential investor’s philosophy. It’s a win-win situation.
- Syndication is not for everybody. “If syndication were really easy, everyone would do it,” noted Peter. If you are determined, want to work with people, and are willing to listen, syndication might be the path for you.
What is Peter’s philosophy? Treat everyone as a partner. “We’re all in this together, and we’re working toward a common goal of everyone wins,” said Peter.
From housewife to self-storage pro
Linda H. got her start in investing the hard way … when she realized she and her husband didn’t have enough IRA savings to sustain themselves during retirement.
She attempted to solve the problem by starting and then selling a business, but unfortunately, the business crashed before the deal could go through.
At that point, she switched to real estate, where she figured she could have more control.
She bought a fourplex, then a farm, then an apartment building. Then she ran out of money.
Listening to podcasts while she drove to each job site, Linda realized she didn’t necessarily have to go through the banking system … she could syndicate.
The transition from investor to syndicator was an uphill battle, Linda says. “It took a while to figure things out.”
Starting out as an inexperienced housewife, Linda had to wing it … but with some hard work, eventually her efforts paid off.
Today she just closed on two properties, has 850 self-storage units, and is currently working on building units at another site.
- Find the right partners. Linda started out as a lone wolf, but after attending a seminar on self-storage, she met some people who gelled with her personality and they pooled their money.
- Complementary skillsets can enhance your business. Linda had trouble raising money herself, but was skilled at the business side of syndication. Her partners were better at raising funds. Each person was able to focus on their own strengths.
- People want what you have to offer. Linda noted that a lot of average people think the only option for investing is the stock market, which doesn’t offer a high degree of control. People are looking for options but don’t have the time to manage an investment … and as a syndicator, you can provide an answer, she says.
Making a REAL difference with real estate. One of our guiding philosophies is that “everything we do matters if it makes a difference in the life of real folks.” We think it should be one of yours, too.
As an investor or a syndicator, one of your goals should be to make sure people are better off with you than without you.
Another maxim to stick by? We like the words of Dave Zook, who says, “You can be conventional or you can be wealthy. Pick one.”
If you’re a real estate investor … heck, if you’re listening to this show … you’re not normal. And that’s a good thing!
The world needs you. You have an opportunity to add value to other people’s lives, to fill holes left by bad stewards and uninspiring investment options.
Are you ready to take the leap from investor to syndicator? We highly recommend getting around smart, successful people.
One of the best ways to do that is to come to our Secrets of Successful Syndication seminar.
As Tony Robbins says, “Success leaves clues.” So get around people who are super successful … and pick up some clues about how to find more success yourself!
Be the captain of your own ship. And remember, this business isn’t just about making money … it’s about making a difference.
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