Brad Sumrok: So I was like, Brad, how did you do it? I’m like, yeah, I raised 15 million in 72 hours. That 72 hours took me 20 years to build up the database, the experience, the track record, the confidence. Tim is one of the most authentic and genuine people I’ve ever met. Sincerely believe he’s coming from a position of giving and that means a lot. You’re going to make huge progress. 

Tim Mai: Welcome everybody to today’s Hero Capital Raising show. Today I have my good friend with some rock on the line with us. Some rock and some rock, right? Brad and I go quite far back. We both got started in real estate investing around 2002. And I went the single-family route.

Brad went the multifamily route. And since then he has been, among the top of the top real estate investing educators, especially in the apartments, and multifamily niche. Since 2002, Brad has owned and invested in over 8,500 units. Crazy amount of numbers over 800 million assets under management, and has raised over a hundred million dollars, for these deals.

In 2012, Brad received the n AA Independent Award Owner of the Year award, and Brad has taught thousands of real estate investors. He’s probably one of the top guys. in terms of the number of millionaires that he has created or was responsible for in this multifamily niche. I’m super proud of you, Brad.

You accomplished amazing things. His students combined, have increased their net worth by millions of dollars together and have purchased over five Billion dollars worth of apartment buildings over 500 complexes over 60, 000 units crazy numbers. Welcome everybody. Brad some rock. 

Brad Sumrok: Yay. Awesome. I remember you from way back. It was like 20 years ago. 

Tim Mai: Yeah, the foreclosure seminar that you and I attended. So share with us a little bit of your journey. I know it’s been a long journey and you accomplished so much and helped so many people accomplish so much and so share with us. You know what got started in the business and also especially what got you into the education side as well.

Brad Sumrok: Yeah, it’s, I mean I never thought I would be doing what I’m doing like so many people. Thank you. I was taught to get a job, study hard, get good grades, go to college, get a better job. And then just repeat that process. If you want to climb up the ladder, you have to go back for more education.

I got an engineering degree because my dad never finished engineering school. And so that impressed upon me how I needed to get that degree. So I can have a great life. And then I got a job as an engineer and honestly, I hated it. I was, like, the world’s most average engineer who came in late, left early, and took long lunches.

Wasn’t getting promoted. I wasn’t in my room, but I have to do better. So I was like, I’m going to go back to school, get an MBA and I actually started studying for my 3rd degree, which was law school back in 2000 or 2001 and then I read the rich dad poor dad book when it came out around that time.

And I remember taking my books. And I put them off the table and I was like, I’m going to be a real estate investor and I had no idea about being a real estate investor. So then I started looking at seminars and things like, how do I learn to be a real estate investor? I went to the 1st seminar I went to 10, I think you were there and we were knocking on doors.

Yep. Close properties. And I was like, oh, man I don’t know. I don’t know if I see myself doing this. I’m not going to have that. Oh, man. I don’t know if I see myself in that and then I went to another seminar. Where they taught single-family housing on day 1. it was at lifestyles unlimited back then in Houston, Texas.

Yeah, I learned about single-family housing, and on day 1 I went home that night. I wrote all my goals. I was going to buy 40 houses. In the next 5 years and replace my 10, 000 dollar job income with 10, 000 dollars of investment income. And on day 2, they talked about apartments. And I was like, the heck with single-family rentals.

I’m going right into apartments. And that was my decision 20 years ago. And I never looked back. 

Tim Mai: Wow. I should have followed you back then for sure. Yeah. And how did I know we’re gonna fast forward a little bit, but you were. That was in 2002, right? And then you started your education business when?

Brad Sumrok: Yeah, my wife and I started it in 2013. Okay. Next year will be a decade of educating others. But, yeah, I forgot to answer that. So how I got into education was. I went to a seminar, I did apartments, and my 1st, and 2 deals I did with my own money real quick here. I ran out of money and then, my 3rd deal was a syndication because I found this 250-unit deal and I didn’t have any money.

In my 1st 2 deals, I used all my own money. And then my 3rd deal, I raised 2M dollars and bought 250 doors. But the whole point is I was part of it. The lifestyles group had a network and so I was part of that group and so it just made it easy to raise money if you had a deal.

I quit my job in 05, because, in 05, I was making more money with apartments than I was with my job. So then, I was 38 years old and I was technically retired from corporate America. And that’s when I started mentoring other people. It wasn’t with my own company yet, but I was like a mentor.

At the lifestyles organization, I just found that that was my group because when I went to that seminar, I was the best. Skeptical person in the room. I thought it was a bunch of crap. I thought about going to seminars with a bunch of crap. I went on a leap of faith. I spent 500 bucks.

I was embarrassed. I didn’t tell any of my friends. But it worked, and so that’s how I got into the education business. 1st, I was working with my original mentor, and then, I started doing that with lifestyles and no 6. Or 5 or 6, and then in 2012, I left. And at that point, I had already had a couple of 1000 doors and I left.

And I was out of the education business for a year. And then I was like, man, I really miss you. Mentoring and helping other people. In 2013, me and my wife started our own and next year will be in our own education business for a decade. So that’s the short story.

Tim Mai: Yeah, do you happen to remember by any chance how many students you have impacted that would have gone through 1 of your seminars?

Brad Sumrok: I could probably work in my CRM system, but we’ve upgraded that 3 or 4 times, but it’s been probably. I don’t want to embellish the numbers, but thousands and maybe tens of thousands have been to our seminars. And then, over 600 documented millionaires from investing in apartments that are in our various mentoring programs and stuff like that.

Tim Mai: That’s phenomenal. That’s awesome. That’s a good number to put on your bio too, by the way, over 600 yeah, over 600 documented that became millionaires. That’s really awesome. So share with us, regarding the first race that you mentioned, what were some of your biggest challenges in doing that race?

Brad Sumrok: Yeah, so I think the biggest one for me, the biggest challenge was confidence because. And by the way, if you’re just getting started. You don’t have to buy your own deals with your own money, but that’s what I did because I was following the advice of my mentor. And at that time, back in 2 or 3, the model that I was following was not syndication.

It was by as many doors as you can with your own money under 1 roof. Tim, I have done that and oh, 2, I bought 32 units was my 1st deal and oh, 3, I bought 30 units is my 2nd deal. But now I was out of money. So the 3rd deal, the broker brings me 250 units and I probably have 25 grand left in my bank account.

And what most people would have done is they would have said I need to get out of these 1st, 2 deals, and whatever. But because I was part of an investor community, then I already knew people that wanted to invest. They already knew me. They knew I had a track record. I already had trust and credibility with a couple of 100 people.

So that 3rd deal was my 1st syndication. Honestly, when I went out with it, I didn’t know if anyone was going to invest with me. But because I was. I had made the pre-decision a couple of years back to be in a community of other investors. And so when I put that deal out. Through word of mouth through email, the people that I knew, I already knew these people at the time it was 200 units and it was 30, 000 the door.

I only needed 2 Million dollars, which at the time was like this huge amount of money, but I was able to get 27 people to put in between 50 dollars and I probably had about 150 to 200 already in my database. It actually came easy, but it wouldn’t have if I were out there on my own if I were just, if I were just, not part of, an investor club or an investor community, so that’s how I did it.

Tim Mai: That’s awesome. I know that the community helped a lot, but were there any kind of roadblocks that you ran into some challenges that you ran into in that 1st race? 

Brad Sumrok: Yeah, because, at the time, their syndications were just starting to get popular. I had to find it.

A securities attorney and I had gone through some of the training and I met a securities attorney through that program. So I already had a securities attorney in my database in my service provider, Rolodex. So that’s something that’s important because. You need to know that in advance, you need to know what type of offering you are going to do.

Are you going to do a 506 B? Are you going to do a 506 C? Are you going to advertise? Are you not going to advertise? And so that’s something you want to have figured out. And I think the other part is just the confidence. There are so many students that I’ve trained in their 1st year.

They’re always thinking they watch everybody else and. Some rock communities raise money, but then when they and so it’s 1 thing to you, you get confidence a couple of ways. 1 is by watching other people doing it. And realizing that they’re not any smarter than you, but there’s still nothing like going out and doing it for the 1st time.

And then I just remember some of my students calling me to go, but I can’t believe I have a million dollars in the company bank account. People are actually giving me money for my deal. And so it’s an incredible experience, but it’s confidence, it’s mindset, confidence, and being surrounded by other people.

Tim Mai: That’s awesome. That’s yeah. So let’s go into that. So what would you say? Been through your own race. I know you’ve raised over 100 million for me personally. And then, of course, your students also raise a ton. What would you say are the top 3 ways that you see the best when it comes to raising money?

Brad Sumrok: Everybody has their own top 3 ways, but I’ll just tell you what mine are. Yeah, some people have different strategies so mine is number 1 is. As Tim and many of the listeners are getting to know me. I only see maybe 1 or 2 people that I actually know here.

But 1 is for the past decade, I built up my own educational platform. So we do live events. We do mentoring programs, we do masterminds. And those are what I call high-ticket programs, but not everybody that comes to my seminars joins those programs. So a lot of them want to invest. And so it’s, by building my own community I come across hundreds, if not thousands of people that want to invest in my deals.

So that is like 1 of the best places. Now, if you’re sitting out there saying, hey I don’t want to be an educator. I don’t want to do my own events. 1 is going to other people’s events. Okay, and that’s another thing that I like to do. I go to not only do my own events, but I go to masterminds where people have money.

Not just real estate. I go to mastermind myself as an attendee. And so multiple probably once a month, I’m going somewhere and I’m around 7, 8, 9 figure business owners. And they all make a lot of money and pay a lot of taxes. And when I tell them, I haven’t paid taxes in 4 years, they perk up and they listen and then I tell them how to do it.

And then a lot of them come into my deal. Building the community, leveraging other people’s events, and going to other people’s events. And then social media and I am not anywhere as good as I should be, or could be on social media. But just by posting what I do hey, I just closed the deal.

Hey, I just did an event. Hey, 1 of my students just closed the deal. And I get a lot of inquiries from that. And so what I do is I just keep adding to my investor database. And I segment them the best I can, are they accredited? Are they non-accredited? Where do I meet them? What’s the nature of my relationship with them and stuff like that?

So then what I’m doing is a raise. Depending on the type of raise I’m doing, I know who to send the emails to. 

Tim Mai: That’s awesome. You probably came across a wide variety of different types of investors. Which profile, which investor profile type is yours, is among your favorite? Are they entrepreneurs? Are they doctors? Are they athletes? What’s the profile type that you like the most? 

Brad Sumrok: I would say there’s really 3 okay and it’s hard. It’s hard for me to just give you 1. So 1, I think I already covered, but it’s like a, it’s like a busy professional that makes a lot of money and pays a lot in taxes. And for them, the idea of going out and finding deals and analyzing deals and overseeing deals.

It’s just a lot. It seems like a lot of work and it is. And so that’s 1 of the 3 people that I would talk to. Now, the other 2 might be a little contrarian. Okay, and the other 2 for me are people that have jobs and want to get out of jobs because that was me. 20 years ago, and other people might be doing single-family or notes, or they’re doing smaller deals, but they want to move up.

Now, let me explain that because. Like in my education program, those are also the people that I talk to about being an active investor, like being on the GP team, being on the syndication team. But what I find Tim, is that a lot of people that are GPs that are syndicators GP means general partner and I’m gonna use that term synonymously with the syndicator. A lot of them also become passive investors.

Okay, and so it’s not an either-or world where I’m a syndicator. So I never invest passively. And so a lot of my students might be in 1, 2, 3, 4, and 5 deals as a. Limited partner or a passive investor before they ever find their 1st indication.

Tim Mai: Yeah, very cool. And what’s so if you don’t mind sharing, what are some of them? Especially for someone starting out, and you’re doing their first race I guess let’s let’s go with that ideal person. What would be the, where’s the first place that you suggest for them to go to do their first race yeah, is it events like you mentioned, is it there, everyone on their contact list like what are some of the few top ways that you’d hey focusing on this one.

Brad Sumrok: Yeah, look, it depends on where somebody’s starting out, but I think that I can only share what I’ve done. Right and so there are a lot of ways to get started, but the way I got started is I went to a seminar. And I became, I call it what you want. I bought the upsell, right? I bought the mentoring program and I felt like an idiot, but it worked.

And so I got the education and I got the coaching and I got part of the investor community. That’s why I’m passionate about what I do. And I, by no means, am I here to be self-promotional. And there are a lot of ways to get there. But not so number 1, let me just generalize number 1, you need to, you want to get educated.

Because if I were to invest with you. And it was your 1st deal, you got to ask the question why would somebody with money invest with you? And a lot of people out there were like, oh, you’re helping them. You’re not asking for money. You’re giving them an opportunity to.

Yeah, that’s partially true, but people with money already have a lot of opportunities. I got money and if you don’t, you’re going to want to. Say, like why would I give you money? Not you, Tim, but if you’re brand new with no experience, why would I invest in your deal versus somebody?

I know that has. 899 deals, so when you’re new, it’s good to leverage the experience and track record of somebody else with experience. Okay. By being by, if I ask somebody what are your qualifications? This is in corporate America where you could say, Hey, I have a degree, but where did you learn this stuff from?

So I would say get educated, invest in yourself. And then I would also say, you wanna be a part of an investor community, or at least you want to be attending and building an investor database because people invest with people they know and trust. And if the first time they’re hearing from you is at a conference, And you’re pitching them a deal, they’re not likely to invest with you and not to mention and not to mention is that compliance, if it’s a 506 be, it’s not even compliance.

Probably, because you don’t have that pre-existing relationship with somebody, right? Okay. All right. These steps are to educate and build up your database. Through people and getting people to know I can trust you. And again, there are a lot of ways to do that. Right? 

Tim Mai: So let’s assume, they, so they get started, they joined a group, and now they’re connected in the network and. They’re like, you know what? I’m going to go big. I’m going to raise a hundred million dollars this year. So if you were that person and your goal is to raise a hundred million in your first year in the business, how would you do it?

Brad Sumrok: I don’t know because I’ve never raised a hundred million. 

Tim Mai: I’m just like if you have to guess, like, how would yeah, like knowing what you know now and, knowing what it takes to raise 100 million, how would you 10x yourself as a newer person to expedite that?

Brad Sumrok: Yeah that’s a great question. So actually right now that’s where I’m at now. It’s because I’ve raised over 100 million, but it’s been 20 years. Okay. And I’ve been going deal by deal. I don’t have a fund. And every deal that I do, I could bring 5, 10, 15 million into a deal.

Okay and again, to me, the whole process is. Follow the yellow brick road. I would ask myself who do I know that’s raised 100M? Grant Cardone, maybe. And what is Grant doing? And how does he do it? But here’s the other thing and this is and I don’t want to get too choppy on this, Tim.

I think anybody out there could raise 100 million, but if you’re starting from 0, and I don’t just mean 0 experience, but 0 contacts, 0 database, 0 notoriety, 0 followers on Instagram or. Or tick-tock or Twitter or LinkedIn or whatever Grant is able to raise that kind of money now, but he started with a 40, 40-unit deal, right? We all look like an overnight success. But overnight in my database, I just did a raise and I helped. I raised 15 out of the 18 million dollars on a 50 on a 51 million dollar deal. I was like, Brad, how did you do it? I’m like, yeah, I raised 15 million and 72 hours.

That 72 hours took me 20 years to build up the database, the experience, the track record, the confidence. And going back to your question, Tim I’m not here to say you can’t. I can’t do anything. I’m just saying that whatever it is that you want to do, find somebody that has done it and follow in their footsteps.

That’s what I would do. I wouldn’t try to reinvent the wheel. I’d be like, okay, who out there is raising that kind of money? And let me, let’s find 4 or 5 of those people and let me see what I could do to sit down with them, add value to them, learn from them, and follow in their footsteps because 1 of the hardest things to do is reinvent the wheel.

Tim Mai: Yeah, and just so everyone knows Brad is the strategy brother suggesting is exactly what I’m doing with this capital raising show. So I’m brand new to the multifamily commercial space. And I asked myself those exact questions like I want to be. A capital raiser and what is it going to take for me to raise at least 100 million dollars? And so that’s why you’re in this interview, Brad. So thank you for contributing and being a part of my learning process here. 

Brad Sumrok: Here’s the other thing, let’s say you want to raise 100 million and you’re new. Tim, let me ask you this. If I were new and I told you I was raising 100 million, just think of the questions you would ask me.

If you’re new, who are you investing with? But if I said, hey, I’m investing with this guy and this gal and this person, and here’s their track record. So you want to be associated with success. As well that’s what I would do. 

Tim Mai: Yeah, for sure. For sure. That’s exactly it. Yeah. Yeah, and same, very similar strategy in terms of putting my own money into some of these guys’ deals.

So that way, when the opportunity comes up for me to help them raise money on their deals. I can write off of their track records as well. And it’s really, yeah, really cool. The stuff you’re sharing here, Brad. So what are some of the top ways that you use to build your authority in the marketplace?

I know you do a lot of education, but let’s assume someone. Yeah, let’s assume someone doesn’t have an education platform. What are some of the ways you would teach them to set themselves apart to set themselves as an authority that someone would invest with them? Yeah, so there’s a lot of ways that, but again, going back to the basics, invest in yourself, get educated.

And then I would say look, and I don’t want to say, don’t try to raise 100, 000, 000 a year by all means, if you think he could do that, do it right? Think big, but getting a deal under your belt is important. I like to think there are some kind of rungs of a ladder.

And the thing is you could climb the rungs faster. Okay, so I’m not saying, you go as slow as everybody else and dumb, do 1 deal a year, whatever. That’s not what I’m saying, but, once you get the 1st deal under your belt, it’s easier. What a lot of my students do is they come in green and they want to do it. I talk about doing over 100 units on your 1st deal.

Let’s just do the number 100 units. And you’d be lucky to find something at a hundred k a door right now, but let’s just say a hundred units at a hundred k a door is 10 million, and at a 70% leverage, you’re looking at a 3 million raise. So then ask yourself where am I gonna get $3 million?

But if you have the ability to maybe bring. 500 K a million, you could be brought in as a co GP is a co syndicator with somebody with experience. And 1 of the ways that a lot of people get into the game. Do they get a piece of a syndication team or a general partnership team?

And so that way, you don’t have to do everything yourself. Because if you’re trying to do everything yourself, find the deal, analyze the deal, secure the loan, raise the money, manage the deal, it’s a lot. And that’s why, and that a lot is why a lot that a lot is why a little bit of people do it, they get stuck.

But if you start realizing that you can be part of a team. Where you can contribute as a general partner, then you can build up your ability. I have a lot of students right now. They want to be doing deals. They’re just getting started. Tim some of them are starting their own Facebook groups.

Some of them are starting their own meetups. Yeah, some of them are taking what they learned from my program and then they’re coming back and. And they’re sharing it in a local meetup or on a podcast. As I said, we’re in a Facebook group. Or, they could be a guest at somebody’s event or something like that.

So all of these ways. But the point is you got to put yourself out there. You got to share what you’re learning. And if you’re sitting there thinking oh, my God, I’m new. I don’t know what I’m talking about. Just know that your goal is not to know more than anybody else.

Your goal is to add value to your avatar. And if your avatar is somebody that doesn’t know anything, or that it’s investing in the stock market. Or precious metals and you can talk to them about real estate. You can talk to them about cash flow appreciation and taxes. Now you’re adding value to them. And so you become an authority. 

Tim Mai: That’s awesome. And what are some of the ways that you keep in contact with your investors? Do you send out an email newsletter or physical newsletters? What are some of your strategies there in terms of maintaining that relationship? 

Brad Sumrok: Yeah, you want to nurture that investor database.

If the only time you’re going to them is when you have a deal, you’re going to be like, oh, here comes Brad again, and you must have a deal, as opposed to being like, hey, everybody, I just want to update you on a regular basis. And it could be weekly, monthly, bimonthly, but get into a cadence where you just say, hey.

Okay. Let’s say you’re a full-time investor and maybe, you’re building up an investor database. You can start with something monthly or bimonthly and say hey, we’ve looked at. 5 deals this month, we made 2 offers. We didn’t get the deal and here’s why we were out bad, but we, we felt like.

Maybe we didn’t want to overpay for that deal. And so you can take everything you do and make it into a positive you don’t want to say, oh, man, I can’t find anything out there, but you just say, I looked at 10 deals. I made 2 offers. I didn’t get them. They sold for way over what they were worth. Trust me, I’m only going to buy deals that meet our tight underwriting criteria.

These are the types of deals we’re looking for, but these types of returns. Till next time see you later, Brad some rock and then, you send something out again and you. You get into a regular cadence and then you find that it’s not the 1st or the 2nd time they’re hearing from you.

So now you’re adding value to them. You’re sharing with them what’s going on, what you’ve been doing. And now when you have something, they’re more likely to be interested. 

Tim Mai: That’s awesome. And do you like it in your own business? Do you do any physical newsletters? 

Brad Sumrok: Like I do a monthly digital newsletter.

So if you mean I don’t send out like a Yeah, like a piece of paper, okay. I do, and I also do videos like, let me ask you this everybody give me some feedback. If I, if all you could do is hear my voice. Does it have the same impact as seeing my face? Yeah, exactly. How many people like seeing My face? I know it’s not. I think it’s a beautiful base, but maybe you guys don’t.

If you can connect with them 1 way is to do a written email newsletter through your. CRM system, but every 1 of those things I do, Tim, I have a video from Brad. I’ll say, hey, everybody. I’m excited to be reaching out to you again. It’s the beginning of the month. Wow. Last month was a great month and in this newsletter, we’re going to be talking about a deal.

We just closed and my favorite market is this month that I want to feature and maybe 1 of my students that overcame an obstacle I want to share that success story with. So they’re seeing my energy and passion and not just having to read through a copywriting of an email. 

Tim Mai: That’s good. That’s what I like. Is there any kind of specific software tools you use for that or just normal YouTube or just.

Brad Sumrok: Yeah, I’m not the best technology person in the world, but I like my company. Uses, and it’s combined. For our education company, we use keep, which used to be infusion soft.

But then when I do my capital raises I have my whole database for both my education company and my investors in keep and I have them segment and then tag. Keep enables me to do a lot of things with emails. I could insert videos. I’ll do a video on my phone and upload it into the video.

And then from there, I could insert it into my CRM system. And I could. I could put in buttons for signing up for this webinar. I can put in a button to take you directly to the link to subscribe to the subscription documents. That’s what I use. I don’t know if it’s the best 1 out there, but that’s just the 1 that we use.

Tim Mai: That’s awesome. That’s great. Now, Brad, I know you’ve been in the business long enough, 20 years now and you’ve been through the last market crash. What is your crystal ball telling you now? And, with this upcoming market?

Brad Sumrok: Yeah look I have been through the 28 downturn and I don’t have a sob story from it.

Meaning I actually did pretty well and I can tell you a couple of things. Number 1, we are not in 2008. There are a lot of differences. And 1 of them is there’s a lot more demand for housing than there is supply. And that was a little different back in 2008. And the other 1 is back right before 2008 happened.

The working-class family, it was really easy for them to buy homes. They could get a loan on a single-family home for a very low credit score, nothing down state of income, and now they need a 660 credit score. They need 20% down and the price of housing is shot up. The interest rates have shot up.

The has shot up and so all those things favor. Renting, and so there’s a lot less. Available housing units, single-family and multifamily combined, and they’re all households being born in the demographics. Make it harder, occupancy is at an all-time low. I’m sorry. At all time high vacancy is an all-time low or a very near an all-time low right now and rank growth is at or very near an all-time high and the supply-demand is imbalanced.

Is huge and the affordability of buying a home versus the affordability of renting and a lot of markets is also pretty big. I’m very bullish. I just closed on a. 1100-unit portfolio on Friday. Wow, congratulations. Before that, we did a 51 million deal in Nashville. So like, I’m not just telling people to buy like I’m actually buying.

Tim Mai: That’s awesome. Are you doing any Class A? I know you teach a lot in Class B and C, correct?

Brad Sumrok: Yeah, look I do whatever I bought a class a last year. I bought a class right in uptown Dallas right off of 75. if anyone here is from Dallas, it’s right between. West Village and Knox Henderson for 238 of the order.

At the time, it seemed so expensive, but now things in that area are selling for 400 a door. It’s crazy. Yeah look, my, my bread and butter deal was B and C, but I’m not limited to that. And I bought a’s and I have students buying a’s. And it’s, it’s the same, but there are some unique differences as you move up and down the property class spectrum.

Tim Mai: You mentioned that you don’t have a sob story from the 2008 market crash. Can you share, why you think that is so, is it because of the asset type that you went after or what had you thrive in that market? While a lot of people got taken out.

Brad Sumrok: I always look like you’ll never meet somebody in any business that says, oh, I’m so aggressive.

I love taking risks with your money, you’ll never meet somebody that says that, but a lot of people do. And how they do it is that back in 07, for example, there were people getting. 80% loans. Plus 15% mezzanine finance, which is a fancy term for a secondary lender that would come in. That was like, if you had a Fannie Mae 80% loan, they would approve a secondary lender mezz financing. There are people getting a deal into deals with literally 95% leverage 5% down and a lot of those people. When the times got tough, they were underwater. And they also, look, a lot of people can put a deal together, but as an LP, as a limited partner, there are a few things you want to look at.

Number 1 is. What is there, how much, what is their capital stack in terms of? Syndicated equity versus debt and maybe private equity and who’s getting paid 1st, 2nd, and 3rd. And then the other is Tim, I hate to say this, but there’s a lot of people putting the deals together. But if you open up the hood for their own financials.

They have very little net worth and liquidity. I’m going to be brutally honest if I can, because people are like, Oh, it’s not about.

The money anymore, and I just want to give back, and there’s a lot of truth to that, by the way, I’ve never really been money motivated but I’m challenge motivated. I’m competitive to me, with money and cash flow and a number of units and a number of deals. It’s like a scorecard.

And if you’re a competitive person I’m 55, Tim, I, and I feel like I’m just getting started because I look at, some of my, some of the people I look up to are like Tony Robbins, Grant Cardone, 2 different personalities, 2 different types of people, but they’re in their 60s.

and you gotta ask yourself, are they slowing down or do they have their foot on the gas? I like to have my foot on the gas because. Because it fulfills me, right? It’s challenging. I’m in the back room of my beach house right now in Florida. And, I’m surrounded by a lot of people, there are tourists and there are 70 and 80-year-old people around here, and I’m too young to not be pursuing anything. I want to do more deals and I want to do bigger deals, but I also want to help more people. And you know what? That’s synergistic because the bigger the deals that I do, the better of a mentor I am. And then I can come back and share with people like, hey, here’s how I like 2 years ago, the biggest deal I ever did was 35 million dollars.

And then I read the grant card and I paid him. I’m just if I could share this, I paid Grant 100,000 dollars for 4 coaching sessions. 1 on 1 and I didn’t go there to learn apartments because I already know apartments. But grants, I’m being transparent here. Hi. His mindset, his confidence, his belief in himself is bigger than mine.

Mine is a lot. It’s still probably bigger than mine, but it was a lot bigger back then. And so I wanted to be with him for 4 hours because I wanted to learn what he thinks, how he thinks, how he sees the world, how. How he’s so confident and how in your comfort zone. We’re comfortable doing 30M dollar deals.

And he said the only thing that’s stopping you from doing 100, 000, 000 is yourself. And so he said, I challenge you between now and the next call, which is 3 months for you to have 100, 000, 000 dollars under contract. Wow. I was like, what the hell?

Annie Dickerson: Do you know what your investors are looking for? Because you were like an ambassador for them. You’re like a representative for your investor group. So you’ve got to know what they want. So you can go out in the world and find that thing. And once you find that thing, if you’ve nailed it, I guarantee when you go back to your investor group, they’re going to say.

That’s exactly what I’m looking for. I’m totally in. Tim is one of the most authentic and genuine people I’ve ever met. Sincerely believe he’s coming from a position of giving and that means a lot. You’re going to make huge progress. 

Tim Mai: Welcome everybody to today’s Capital Raising show. I’m your host. And I have an amazing guest on the line with us today.

Annie Dickerson with Good Egg Investments. They, gosh, I’m going to read her bio for you here, but it’s so impressive. As I got to know Annie and her team more, it’s They’re doing amazing stuff. Annie… 

Annie Dickerson: Stop it, Tim. You’re making me blush over here. 

Tim Mai: Yeah, so Annie is an award-winning real estate investing expert with 15-plus years of real estate investing experience.

In 2022, Annie was named real estate investor of the year by the Motley Fool. Annie and her… Any and her business partner, Julie Lamb, are founders of Good Egg Investments, which was named the best real estate syndication company in North America in 2020. Together they have helped thousands of investors around the country to invest in commercial real estate assets totaling over a billion dollars.

Any and Julie are authors of the book, Investing for Good. Host of the Life and money show podcast and creator of the real estate accelerator and the lead mentorship program designed to help people learn to raise private capital for real estate investments. So with that, everyone, let’s give India a big welcome.

Annie Dickerson: I’m thrilled to be here with all of you. 

Tim Mai: Awesome. All right, I am super excited to hear your story and you guys have been growing so far, so much so fast. As, as I put the words out for the type of guests that we want to. have an interview on this show. You came very highly recommended.

And so I’m super excited. So many of you can share with us a little bit about yourself, how you got started in this business, and what made you decide to get into this business.

Annie Dickerson: Oh my, yeah. The first thing you should know about me is I never intended to get into this business. Hearing some of your stories, you have a very intentional path and I applaud you for that.

You are. Leaps and bounds ahead of where I started because I came into this business screaming and kicking. I was like, Nope, not going into real estate. And so actually I started my career as a fourth-grade teacher with Teach for America, big plans to close the achievement gap opportunity gap. And after a couple of years as a teacher, I wanted to make a bigger impact was the common theme throughout my story.

So then I went from Teaching to game design. I wanted to make educational games for kids. And so did that for a few years and then moved down to the Bay area where we are now to get into adult learning and development. So taking that game design experience and infusing it into creating training for companies like Google and Facebook and whatnot.

And real estate was never on my radar. Never. When we moved to the Bay area, my husband became a real estate agent, which he still is now. And as soon as he did that, I said crossing real estate off my list. We can’t both be in real estate. We can’t be that couple. So I’m like, okay, you do your thing, do your real estate thing.

I’m going to focus on climbing the corporate ladder over here. And So he did and his business started to grow and I, a couple of years in, he was like, Hey, could maybe be on the side, maybe you can help me with my business. I was working as a creative director at the time. He was like, maybe you can do some design work, marketing, that kind of stuff.

At the time, I knew nothing about any of that. And I was like, I, I’m really. Busy with my job here. I don’t have time, but maybe I’ll read a book. And in the process of doing so, I looked at his website and I was like this is within my wheelhouse. So in the process of redesigning his whole website, what happened?

I fell in love with real estate, but not what he does through selling residential real estate, but the small multifamily. And so I thought. I’m going to quit my job and we’ll just buy a whole bunch of these small multifamily homes and I’ll be set. I can retire for life and I don’t have to do anything else.

And that was my plan. And, I got obsessed with it. Every time we get together with friends, they ask, what are you up to? How are you doing? It was all I could talk about. I’m like, check out this market. I’m looking at this property. You guys know, right? When you have that bug, you have that passion.

It just spills out. And so I was talking to everybody I could about it. And every time they were like, Oh my gosh, this is amazing. Teach me how to do it too. I want to learn. And I’m like, great, I’ll teach you everything I know, pull up a chair, and okay, here’s how you do it. You start going through the, you guys know all the steps, right?

Yeah. Research the market. You have to get in touch with brokers. You got to look at the properties. You got to underwrite. You got to do all this stuff. And two or three steps in without fail. Every person’s eyes started to glaze over. They were like wait no. You misunderstood.

I don’t want to do any work. I just have this little bit of money that I want to put into real estate. I would, I’d rather you do the work. Could you just do the work for me? I’ll just give you my money and we can invest together. I’m like, I don’t know these little properties. But then that’s what led me to then say is there a way, how can I do this?

And that’s when one thing led to another, I discovered syndications. And at first, you guys might appreciate this. I thought capital raising was the worst part. Of the whole thing. I thought, okay let me just do everything else. I can focus on the acquisitions. I know my way around a spreadsheet.

I can talk to brokers, but capital raising. I don’t want to do that. Somebody else does that part. I can partner with somebody on that. But fortunately, I had an opportunity early on to be a part of a deal where. They convinced me to try it. They said, maybe you should just try it. You don’t have to raise a ton of money.

Maybe just bring a couple hundred thousand to the deal. And I very reluctantly said yes. And as soon as I started, I loved it. It was the coolest thing ever because it was the perfect mix of what I was doing as a teacher. And what I was doing as a designer and I was educating people on this opportunity that they wouldn’t otherwise have access to.

And so that was back in 20, early 2018. That’s when Julie and I partnered up. And since then we’ve done about 40 syndications. We’ve got thousands of investors and it’s just been a wild ride. 

Tim Mai: That’s an amazing story. Wow. So did you join any type of mentorship group or mastermind group?

Annie Dickerson: Everyone. And we’ve been part of almost every one of them. And you know what they say, don’t reinvent the wheel. Others have done it before you, you just pick, you’d be a part. So we’ve been part of almost, I think pretty much everyone. I think somebody mentioned Brad Sumrock. We were part of that group.

We’ve been part of Michael Blanc’s group, Joe Fairless’s group. We’ve. Coached with Trevor McGregor and Rod Cleave. So many of the greats in our industry. And, from every one of them, we’ve gotten bits and pieces and nuggets. And what we’ve been able to do is alchemize that into our version and our brand.

And that mentorship, I highly recommend it because. It’s a tough industry to break into, especially these days with more players getting into it. And so to the extent that you can follow somebody’s path that they’ve already created and you can shortcut your time to success.

So I attribute a lot of our success to those mentorship programs we were a part of. 

Tim Mai: That is, that’s awesome. And you mentioned that capital raising was like the bug that got you or that you ended up liking so much. So did that become a major part of your business model to specialize and focus on the capital raising side?

Annie Dickerson: It did. And I, it was unintentional, but looking back, it was the best possible path. And here’s why when you’re starting and you’re trying to get into, let’s say the acquisition side, there’s a ton of costs involved. You got to fly there. You got to visit, you got to meet with the broker, schmooze brokers, and then you’ve got to spend a lot of time, right?

Building out. The analyzers looking at that, maybe you hire an underwriter. So there’s costs associated with that due diligence and the acquisitions, the END, all of that versus when you’re starting out and as we did, we were just talking to friends and family in the early days. I would just hit a record and I’d create a.

Quick. I used a tool called Bomb and I created these quick little, 60-second videos. One on one I’d have my little whiteboard and say, hi, say hi, Tim. I’d wave it in the video. And that was total, it was free, right? And we didn’t have these huge costs in this huge risk. We were just trying to educate people, tell them about these opportunities.

And we got to a certain point where we realized. Holy cow, we’ve got 500, 000 or a million dollars in potential money on the table. And that was a very low cost. Julie and I bootstrapped it from the very beginning. And we only each put in a few thousand dollars for startup costs. And so what that did was it allowed us a low entry point into this business.

And we started to build up this brand and this presence. And we focused on the capital raising side first, because it’s what we knew and what we loved. And as we started to tip the scales we were able to bring not just 500 K or a million, but now three, five, 10 million plus to the table. Now we’re at a point where we can negotiate.

More of the deal in these partnerships and we’re at a point where brokers are taking notice because they’re like, Hey this group is legit. They’ve got a great track record. And that’s the other thing was because we were able to be part of multiple deals, we were able to build our track record fairly quickly as well.

And so now all of that has put us into a position where we have ongoing capital that we’re attracting, which has. allowed us to continue to do more and more deals. 

Tim Mai: That is amazing. In terms of the structure, the legal structure itself, do you mostly go in as a co GP or do you mostly go in as a fund to fund?

Annie Dickerson: So that has also evolved. So in the early days, we were mostly co-GPing deals, and over the last few years, especially as we’ve hit that 5 million and above threshold we’ve had more of a JV structure. And as of last year, we’ve shifted to more of a fund model, not a fund of funds, but actually, a multifamily equity fund where we put multiple assets into a single fund.

So that is our current structure and that’s what we’re moving forward with. 

Tim Mai: I see. That’s pretty great. Since 2018 and now, what would you estimate as the amount of money that you and Julie have raised? 

Annie Dickerson: It’s about, so we’re, we’ve currently got an active raise going on as well. So it’s about 120, 125 million at this point.

Annie Dickerson: A lot of, I got to tell you just for reference for everybody on the call, the first deal that we raised for in 2018, and this is how fast it can happen. In the first deal we raised for in 2018, we raised a total of 420 K. We thought we were going to hit a million at the minimum, but we only hit 420 K, which included.

100 K from me and my mom. So that’s, we were struggling then that was only five years ago. And now we’re well over a hundred million and we’ve got the capacity for endless amounts of capital. And it’s, I just want to say that it’s possible to do within a short amount of time. 

Tim Mai: That’s awesome. So let’s talk about that first race. You said you struggled through that first race or share with us the struggles that you have that you had. 

Annie Dickerson: We had every struggle and we made every mistake. We are okay. So first of all, this is okay. So Julie and I partnered up and this was the first opportunity that came across our desk.

Where we were like, okay, this could potentially work. This was in Huntsville, Alabama, which was a market that I was personally investing in as well. So I knew the market very well and we thought, okay if she could raise it because she was running her own business before we partnered together, she could raise 500 K on her own.

I could surely raise four or 500 K together. We should be able to raise a million. And so that’s what we committed to being able to raise a million. And first of all, there were a lot of new things. That’s what, that was the big mistake. So these days, when we try to introduce a new thing to our investors, we know that change takes time.

And so we try to get way ahead of it and educate on the market or the new asset class or the new operator, ahead of when the opportunity comes out. Or we try to introduce an opportunity that only has one difference. Maybe it’s a partner we’ve worked with before. Maybe it’s an asset class we’ve done before, but maybe the market is different.

That people can handle. The problem was with this deal. Everything was different. It was a partner. They had never heard of it. It was a market that they were not familiar with. And it was an asset class that was new to them. It was a portfolio deal as well. So there were a lot of these characteristics of this deal that we had not taken the time to familiarize our investor base with.

And as you can imagine, we released the deal and there were question after question objections, and they just weren’t comfortable they didn’t trust this deal and so it was fighting an uphill battle from day one. And on top of that, there was a lot of GPS in that particular deal, which we’ve since learned from when you have too many cooks in the kitchen, it usually doesn’t work out well.

So we learned a lot on that first deal. And so we’ve changed a lot of things since then. 

Tim Mai: Wow, that’s, yeah, those are some like golden nuggets just in that short simple answer that’s great. For the folks that are listening to this and they’re fairly new to this, maybe this is their first race or so, what would you say are some of the ideal scenarios to come in, let’s say?

Let’s say we want to come in as a capital raiser, and coach GP onto this deal. What are some of the things we should look for to make our first race easier? So what type of partner we should look for, what type of deal, and those kinds of things? 

Annie Dickerson: So what I would recommend is first don’t start with the deal.

If you’re looking for the easy path, don’t start by thinking about the deal or even the market or anything like that. Start by thinking about your investors. Who are your investors? And the people you already know within your sphere, the people you’re already talking to, who are they and what are they looking for?

We always coach our real estate accelerator members on coming up with an investor avatar and figuring out who’s your target audience. What are their pain points? And what are their aspirations? Because they, you’ve opened up a line of communication with them around real estate investing, and they’re still listening, which means there’s something that they want, something that you’re offering that helps them with a pain point that they have.

So figure out what that pain point is. Is it because they’re trying to replace their income so that they can quit their job? Okay. Then you’re going to be looking for deals with higher cash flow, which I know they’re hard to find these days, but anyway, you want to get a sense of what they’re looking for. So then you can then go out and as you’re talking with partners and looking at potential deals, you’re the matchmaker, what your pool of investors wants and your pool of investors is going to be different from our group of investors.

And you know what they’re looking for. So now, when you talk with potential partners and they say, I have a deal, it’s got super no cash flow for the first two years, it’s a development deal. And, but there’s tons of appreciation on the backside. You’re like that’s a great opportunity, but unfortunately, it’s not a match for my investors.

So that’s what I would say if you’re looking to make your first raise. And quote, easy and or successful raise, you’ve got to know what your investors are looking for, because you were like an ambassador for them. You’re like a representative for your investor group. So you’ve got to know what they want.

So you can go out in the world and find that thing. And once you find that thing, if you’ve nailed it, I guarantee when you go back to your investor group, they’re going to say, that’s exactly what I’m looking for. I’m totally in. 

Tim Mai: I see. So what would be like the top? Maybe the top three questions to ask to quickly find out what they are looking for. What would be a good fit for them? 

Annie Dickerson: So better yet, I think, because I experienced this back when I was working as a creative director if I ask you a question about what design you want or what style you like, you can use words and tell me, but ultimately it’s really hard to figure out what’s in your head.

Versus what’s in my head. So I find that the quickest path to the answer is to give them an example and it doesn’t have to be a full investment summary. We’ve done even just like you can pull out a Google slide or a PowerPoint slide and just pull a random stock image of the type of asset that you’re looking to invest in.

Plop that on there. And then under that, maybe it’s like Class A, built in 2021, in Orlando, Florida, and this many units. And then that’s all you need. And then you can, if you want to, you can build out more and say, this would be the projected cash flow. This would be the business plan, but at the very minimum, you’d have something like that.

And then you use that to start the conversation and you say, Hey, this is. Along the lines of the types of opportunities I’m looking at, if I were to find something like this with roughly, let’s say year one cash flow around four, four to 5% 1. 7 X equity multiple IR around, 14, 15, would you be interested?

And that makes it very real for people because often people don’t know what they want until you show it to them. And then they can tell you, yep, that’s what I’m looking for or no, that’s not what I’m looking for. So I’d recommend that rather than asking those open-ended questions, you take the initiative and create an example that can be super simple and use that example to then crystallize it for your investors.

Tim Mai: That’s, wow, that’s good. I like that I like the way you approach it. Since that first day, what gives us a deal that you have had a lot of challenges with later, now that you’re, now that you’re more established like a recent deal that you had challenges with raising and share with us what those challenges might be.

Annie Dickerson: Let’s see more recently. I can tell you about last year. This may not be along the lines of what you’re looking for, but last year we launched our first multifamily fund in April. In 2022, right before the Fed starts, the Fed starts just hiking up the rates. And as soon as that first-rate height Hick hit, everything came to a screeching halt.

And what we initially thought, cause we had pulled our investors, we had given them sample deals. We were pretty sure. Of how much we were capable of raising. And as soon as the market shifted, all of that came to a screeching halt. And we found that we had to be creative in thinking about, okay, how do we, here are the things.

Just like in the pandemic, when things first stopped in 2020, we also at that time had to figure out, okay, what are our investors’ fears? So the same thing at this point almost a year ago, we had to say, okay, why did everything stop? What are our investors scared of? How can we educate them? So they know what’s really going on and why there’s this opportunity here.

And so in that case, and I would argue, there’s still some of that going on now with some and. Uncertainty in the market and investors may be unsure, so all of you on this call, have an opportunity to step out as a leader during this time. It’s like when you’re on an airplane, right? And there’s turbulence.

You don’t want the pilot to come on. Oh, first of all, you want the pilot to come on and say something. You don’t want to hear anything. That’s the worst, right? If you’re like, the plane’s going like this and you hear no news, you’re like, We’re all gonna die, right? The second worst is if the pilot comes on and they’re like, Oh my gosh, there’s turbulence.

I’ve never seen anything like this, right? And then you freak out. What you want is you’re experiencing all this turbulence and you’re like, Oh my gosh, we’re going to die. And then the pilot comes on and he says, Folks, this is just routine turbulence. We’ve seen this before and we’re going to be fine.

We’re going to be through it in the next two minutes. Just buckle up and sit tight and we’ll be back online soon, right? And then that’s what we have the opportunity now to do. To step into that leadership and that initiative is all of us here. You’re here, which means you’re taking the initiative to network and get ahead of the curve.

And so take these conversations and the data and the bits and nuggets that you’re gathering and bring those back to your investors to still that down and tell them, Hey guys. It’s all going to be fine. Here’s where we are in the market. Here’s what’s coming down the pipe. And here’s why right now is the best time.

And if you do that because there are so many other operators out there who are scared to step into that. If you take, And if you embrace that fear and you step into that courage and you take that initiative, you are going to have investors who become raving, loyal fans. And because you are showing them a path through their fear.

And if they then follow you and they take that chance and they invest with you and they see indeed. Hey. It was the best time they’re going to trust you for life. And not only that, they’re going to start to refer their friends and family over to you too. So I see right now, just like last year, just like at the beginning of the pandemic is a huge opportunity to step out with that leadership.

Tim Mai: I love that. Yeah, like being the knowledge provider, the one that brings them clarity that helps them. Yeah, see a bigger view than what the market is saying right and so that’s awesome. I love that. When you’re looking at your investor profile avatar.

Which buckets are your biggest group of investors? Are they tech people from the Bay Area? Are they entrepreneurs, or business owners? Give us an idea. Sort of an insight into your investors. 

Annie Dickerson: Happy to. Yeah. And when Julie and I first partnered together, we had a very specific avatar in mind and that was moms.

We named our avatar, Jen. She’s 38 years old. She’s got three kids. She’s got a golden doodle. She lives in the Pack Heights neighborhood in San Francisco. We know everything about Jen. And as we’ve built our team knows everything about Jen too. And in the early days, We targeted everything toward Jen.

And what that does for anybody here who may not yet have an investor avatar, is the value of having an investor avatar is that you find yourself in the early days. So often sitting in front of a blank screen, you need to write that newsletter. You need to create that blog post or that video or whatever it is.

And if you don’t have an investor avatar, you’re trying to reach. Everybody, it’s impossible. You’re going to sit there and you’re going to write one sentence and you’re going to be like, no, that’s not right. Delete, delete, delete. And you’re going to say maybe I should talk about this. Okay. Let’s start.

Nope. That’s not right either. You’re going to spin your wheels. Cause I’ve been there. I’ve done that for hours and it’s the worst because you’re just stuck. And when you have an avatar, what that does is now you’re sitting down and you’re like, Jen. What are the questions Jen has? Okay. Jen’s wondering if she’s busy with laundry.

She wants to hear something while she’s folding her laundry. Okay. How can I create a podcast or a quick video for her? Okay. And what would I teach her? She doesn’t know how the whole process works. Okay. Let me see if I can just teach her real quick. How does this process differ from a rental property or something else she’s more familiar with?

And so it gives you a really easy way to start to get what’s in here, which is the gold out into being able to teach people. And so early on, Jen was our avatar. A couple of years ago, we realized that Jen, we created a Jen 2. 0 because she evolved with us. She became a savvier investor because she was reading our blog post.

She was watching the videos and she knew what a cap rate was. She knew how to vet a market. And so she was a little bit savvier. And then most recently within the last year, we’ve discovered we have not just Jen and Jen 2. 0, but we also now have. Bill and Richard. So Bill is a business owner and he’s looking to get his business Operating on its own.

So he can then focus on investing and Richard is a retiree. He’s made millions. Now it’s about capital preservation. And so we’ve realized that even though it isn’t that funny, our messaging was all targeted toward Jen, and then Jen 2. 0, we just naturally attracted all these other avatars.

And people ask us all the time, ” Are all your investors women? Because Jen is a woman, but no, and we never say women only. We don’t take men here. It’s just that helps our brand to have a personality and it helps our brand to be more cohesive. And so starting from day one, our investors were 50, 50 male and female.

And they continue to be. We attract a lot of physicians. We attract a lot of moms too, and now retirees and business owners. And so that’s in a nutshell, who our core audience is and also the value of having that investor avatar. 

Tim Mai: Okay. So would you recommend that everyone start as an avatar and then let it naturally grow the way you have it and not try to focus on three different avatars?

Annie Dickerson: That would be my recommendation because it can be difficult juggling multiple types of personalities and what they’re looking for. So I would recommend starting with one. If you don’t know who that person is, Often you can look in the mirror. Most often people’s first avatar is who they are because you know yourself the best.

You don’t have to do user research to figure out what your pain points are. You already know them. And so that’s the easiest place to start outside of that. Look to your, the people who you’re already talking to about these opportunities. See if there are any common threads. It doesn’t have to be. Gender doesn’t have to be age.

It could be, maybe they’re all looking to quit their jobs. Maybe they’re all looking to start a business or a side hustle, or maybe they’re all looking for cash flow, whatever that is, those can be your characteristic traits. But yes, I would recommend starting with one. It’s hard enough with one. So just start with one.

And then as you get success with that, start to think about branching out. 

Tim Mai: So once you find your avatar, you decide on this one avatar, how can you best market to them? 

Annie Dickerson: All right. Here’s what you do. Super simple. Sit down, set a timer. Let’s give you five, no more than 10 minutes.

Okay. Let’s say we set a timer for 10 minutes. Thinking about that person, jot down as many questions as that person might have about these opportunities. All of the questions you think this person currently has in their brain, that’s keeping them from moving forward and investing with you when the timer goes off.

You’ve got a list, at least, even if you’re, you get off to a slow start and you, at the end of 10 minutes, only have 10 questions, that’s 10 great pieces of content that you could create. So that’s the first step is to think about all the things that this person needs to hear from you to get, we always talk about it like a bridge they’re over here and where they may not know a lot about syndications or multifamily or how this whole world works.

They need to get over here where they’re savvy. They understand how this works. They trust you and your job is to build the bridge. In between, and this list of potential content. That’s the first step. That’s going to tell you how to build that bridge. Then you’re going to take, then you start with that first one and you say, okay, this person at a high level, they don’t even know why multifamily, why should I invest in multifamily versus.

Self-storage or stock or whatever they’re else they’re investing in. Okay. Let me knock that first one off the list. Let me create, whatever your strong suit is or you are most comfortable with. If you want to create videos, blog posts, write an email, whatever it is. I find in fact, if you struggle with it.

Writing blog posts instead of trying to write a blog post, open up an email and just right there in Gmail or Outlook or wherever you type your emails, just pretend like you’re writing an email to this person. Dear Jen, this is a great question that you asked about why you invest in multifamily. I think about this question all the time.

And when I first started investing, this is what I struggled with. And here’s how I figured out the answer because we’re all used to writing. Dozens, if not hundreds of emails every day, you already do that well. So start there. And even if you do a video, you can take that and then read that.

That becomes a script for a video. So I find that taking it out of this Oh my gosh, I have to create a piece of marketing. I don’t know. I’m not a marketer. I can’t do it. Just write an email. And then. That’ll get it out of your head. Then you go back and you say, okay maybe I make this part a little bit more formal, or maybe I changed the story and I had this part in instead.

And often you can take that email and just plop it onto your website and that becomes a blog post. And again, you can put that in multiple places. Tim, what are you doing now, right? We’ve got this live streaming. We’ve got people in Zoom. This is going to be a podcast, right? So, we call that spider webbing.

You take one piece of content, you spider webbing out into all these different places. And so you’re minimizing your work, but you’re maximizing your presence. And so that’s where I would start. Make that list of what your avatar wants to hear about, and then start writing those emails and turning those emails into pieces of content.

Tim Mai: That’s great. Yeah, I love that because I know I would struggle if you tell me to sit down and write an article, get it I won’t do it. But, framing it as writing an email Oh I can do that. That’s easy. 

Tim Mai: I love that. And then in terms of. So that’s from the content perspective and attracting them.

What else what’s another good way to find where they’re hanging out so that you can then connect with them and further that relationship? 

Annie Dickerson: That’s gold right there where you said, where are they currently hanging out? And so here’s the thing is a lot of people say I’ve got to, I’ve got to build my brand.

I’ve got to build my website and I got to point everybody to come back here. Come to my website. And that’s hard. There’s so much noise out there and it’s going to be hard for you to put up this billboard and suddenly everybody comes to you thinking about the user experience. What you want to do is go to them.

So once you’ve got your version of Jen, part of that should be, where does Jen currently hang out? Does she go to in-person meetups online? Where is she hanging out? Is she part of Facebook groups? Is she on Instagram? Is she on Tik TOK? Where is she? Online. Where can you find her? And for us, Jen, as a mom, was hanging out back in 2018.

Anyway, she was in a lot of these moms, Facebook groups, the ones where you ask everything from, how do I save for my kid’s college to, Oh my gosh, my baby has a rash. And what is this thing? Those types of moms groups, right? And so we said Jen’s hanging out there. She may not be the one talking about investing, but she’s, at least we know she’s here now.

How can we insert ourselves into that conversation and provide value, not advertise and say, come to us, but be of service? And so one of the things that we did that was super helpful in the early days was we would go into these moms, Facebook groups, and we would. Think of topics that were not directly tied to real estate, but getting at that same pain point of building wealth, and creating cash flow.

And so we were thinking moms, they’re thinking about saving for their kids’ college. And so we would go into these moms’ Facebook groups, and they have a search bar and we would just type things like five to five to nine plans because that’s commonly what a lot of parents think about when they think about saving for college.

And so lo and behold, there would be these threads sometimes from, 18 months ago, even many years ago, talking about saving for college. But the beauty of Facebook groups is as soon as you comment, it brings that thread right back to the top. And so we would find these threads where people were saying.

Yeah. Hey, how should I save for my kids’ college? And most people were saying five to nine plans. That’s what I do, or I put in a savings account and we would come in and we’d say here’s what we’re doing. It’s a little bit different from everybody here, but here’s what we’re trying. And here’s how it’s working.

If you want more information, feel free to message me directly. And we’d post things like that and our inbox would just blow up. People would be like, Oh my gosh, I’ve never heard of this strategy before. Tell me how this works. And we’d have all these one on one conversations. And, a lot of our, one of our biggest investors to date came through that exact strategy.

She was looking for it, she had just had an inheritance. Over a million dollars. She didn’t know what to do, and she didn’t know us from anybody, but she saw us have a presence in this Facebook group and talked about this alternative way of investing. And after a little while, she reached out and said Hey, can I just learn a little bit more?

She didn’t tell us anything about her inheritance at that point, which was smart for her, she was just like, I’m just curious. And so we established a relationship and over time she’s, she and her husband have now invested in over 15 deals with us, well over a million dollars, all from a Facebook conversation.

So this is a very powerful strategy. 

Tim Mai: It is. I don’t know if the people listening realize how Big of these ideas are. I was just thinking, okay, that’s it. We can end the show, we can all go home now. This is so good. I love it. This is such a stealth strategy.

Annie Dickerson: Yeah. Yes, it’s stealth because you go where Wayne Gretzky said you got to skate to where the puck is going.

You have to figure out where these people are, where they already hang out. You got to go there. That’s how you’re going to find your success. You have to figure out what they’re already talking about and figure out how to insert yourself into that conversation. If you try to force yourselves on them, you’re not going to have any success.

So that’s why it’s key that you know who your investor avatar is. So you can do these stealth strategies just like. 

Tim Mai: This is so good. All right. It’s so good. I have to ask you for one more. Give us one more. Yeah, around, around this marketing side of it. Like one more good. 

Annie Dickerson: All right. Okay. One more.

I’ll give you one. The one that’s coming to the top of my mind right now is accountability. Because all these ideas are great and we could sit here talking all day about this marketing idea. This is so great. You’re taking all these notes. And then tomorrow comes and you’re like, I don’t know if I could do that.

Let me go do something else. And then just days go by and it doesn’t happen. Here’s what we did back in the day. We said we wanted to commit and we saw the potential. We saw the opportunity and we said, okay, how can we hold our own feet to the fire? And so what we did was we committed, we announced this publicly to all our friends and family, that we were going to put out a weekly newsletter.

And this is a little nuts. So this is only for, not for the faint of heart, but that’s what we did. We said we were going to put out a weekly newsletter. And not only that every newsletter is going to have at least one brand new, fresh piece of content for our investors. Which means every month we were putting out at least four new pieces of content.

And that allowed us to then build our vault of content very quickly. Over a year we had dozens, if not hundreds of pieces of content, and that’s what helped us to build that investor base. And I love what writer Shonda Rhimes says, she says writing for TV is laying track for an oncoming train.

And that’s what our newsletter was to us. It kept us accountable because we knew that the newsletter was going to go out every Tuesday. And whatever we had to do, bend over backward, whatever else we had going on, that newsletter was going to go out, and darn it, it was going to have a new piece of content in it.

So we had to figure out how to make that happen. And so that was our oncoming train. And because of that, because we want, we committed to that and we said, this business is all about trust. We held our feet to the fire. We committed to this. We have to keep this on track. And so that’s a huge part of why we’ve been able to build our presence in our brand to this point because we got so much practice with building the content and we knew exactly what our investors were looking for.

Because we kept putting out that content. So whatever that is for you, doesn’t have to be a weekly newsletter, you commit to once a month putting something on YouTube or daily posting in a Facebook group or something like that. Whatever it is, I challenge you just to commit to one thing.

Don’t try to do it all because you’re going to get overwhelmed very quickly, but just pick one thing and commit to that. And from there, once you’ve got a handle on that, then start to expand from there. 

Tim Mai: That’s perfect. You answered my next question without me asking it, which is about building trust and authority.

Wow. And with chat GPT being popular these days, it can help a lot with writing some of these articles. So yeah, I. I love that. And then I know the newsletter you mentioned was a big one for you. Do you also do physical mail out at all, or just all digital? 

Annie Dickerson: Yeah, we haven’t, I know several groups do.

We haven’t expanded to that yet we’re finding pretty good traction, just with our online presence. 

Tim Mai: That’s great. Yeah, I know I received Joe Phelous’s newsletter and it does keep him top of mind for me for sure. It’s Oh, it’s here again. 

Annie Dickerson: Yes, that’s right. That’s right.

Tim Mai: That’s cool. And then what are some of your favorite tools that you use in your business?

Annie Dickerson: Oh, my goodness. Okay. So we’ve got all the regular ones, right? Google, Slack, YouTube, and all these things. But let me dig deeper and think of some things that you all may not know of. On the design side, when you’re creating things for yourself, like the images for your blog posts and whatnot, or finding images for your website, there is a great free stock image site called Unsplash.

com here, maybe I can. Put these into the chat for anybody here. Unsplash. com is a great one. So that one I use, almost all of the photos from our site come from there. And as a creative director, I have a high bar when it comes to imagery. So that’s a great one. Another one, if you’re looking for one.

Color palettes for your website as a color hunt. co. I use that all the time and we use that as we put out new deals as well. Google Slides, believe it or not. So I think somebody mentioned Canva. So Canva is great. And if you don’t want to, if you’re not a designer and you don’t want to learn a new tool, I find that Google Slides and PowerPoint are great design tools.

And they can do most of the things that you need. I’ve built and designed whole websites, believe it or not, inside Google Slides. They are powerful design tools and you don’t necessarily need to venture off into other tools for that. Let’s see, for huge investor polls, you always want to know what your investors are looking for, and what they want to invest in.

We’ve used Google Forms in the past. That’s a great, simple tool to use. We’ve also used a tool called Survey Sparrow, which allows you to create more fun, custom, more interactive surveys. For our CRM, we use ActiveCampaign. That one I couldn’t recommend more highly. It’s to get you off the ground with investor communications.

And especially with automation, it’s a really good tool. Easy to use, easy to learn, and powerful. Beyond that, let me think if you’re using it. WordPress. There, so early on, we built our website using Wix because we were just intimidated. We didn’t know how to build a website and Wix like Squarespace is very like drag and drop, right?

And WordPress tends to be a little bit harder to learn, but over time, WordPress is more SEO friendly and it’s also more powerful because it’s got all these plugins. So there’s a plugin for it. WordPress is called Elementor that does turn it into more of a drag-and-drop website builder. There are so many more.

But those are the initial ones that come to mind through our real estate accelerator program. We share all of the tools that we use. Oh, 1 more. I got to share 1 more with you. If you were creating videos, if you’re creating videos, you’ve got to get an app called Big VU.

It is a teleprompter app and it is so cool. Oh my gosh, this changed my life because, in the, I see somebody say, I love big views. I love it too. In the early days, I used to try to create videos with just a bullet-pointed list and I would hit records. I messed up, hit stop, hit record, stop over and over again.

And what big view allows you to do is take a script something you write and turn it into a script. And what it does is you hit a record right within the app and the script starts to scroll up. On your screen, all you have to do is just read because the script is close to your camera.

It looks like you’re looking directly at the camera. So you can often get it in one take. So that’s another really good tool as well. 

Tim Mai: That’s great. You are such a. An incredible resource of information and resources. Yeah, this has been one of the most informative interviews I’ve done, because of the way you answer and the way you expand on your answers. I love it.

Thank you so much. 

Annie Dickerson: Good. I’m so glad to provide some value. I just want all of you to know, I’ve been in your shoes. I know how hard it can be. I know how overwhelming it can be. And, it’s hard, there’s so much out there. It’s hard to know what to do and when to do it.

And so that’s why we open up our entire business. Everything in the back end of our business, we share with all of our coaching members. And if there’s, whether you guys decide to join or not, that’s not, I don’t, you don’t need to but know that I’m here as a resource, because I want you to know that, you can succeed in this business.

And it’s a wonderful business. It makes a huge impact. And if there’s anything that I can do to help any of you, I’m always here. Happy to share anything that we talked about today or anything else. 

Tim Mai: That’s great. Now I wanna talk about, where you see the market is going, and then also too, I know you started your funds last year, right?

And so do you, are you still moving forward with the fund model in this changing market? And do you see that as an Advantage or disadvantage versus syndication with where the market’s going? So if you can share some of your insights into that. 

Annie Dickerson: We just launched our second multifamily fund in December.

So we are continuing to move forward with the fund model. And so this one is similar. It’s a multifamily equity fund, and it’ll hold probably two to four or five assets in it depending on the sizes we’ve got our target markets and whatnot, and, I think it’s a terrific model. It’s not, again, it’s not for the faint of heart and it can be difficult starting with a fund model because here’s why when you’re launching a fund, people are investing in you.

Because you are making the choices and you are going out and finding those assets. Whereas when you do syndication, you launch a specific asset or a specific deal, then they’re vetting that deal. You are a part of that, but they’re the onus is on the deal to perform. And so it can be a shift and so that’s why we’ve built our track record and now we’re switching to this model.

But what that allows us to do as our business grows is now have that capital more at the ready. We’re not behind the eight ball, we’re in front of it. And so we’ve got that capital at the ready, which then allows us to go out to more brokers and know exactly what we can offer and what we’re looking for in that fund.

And people are always hesitant to jump in on the first of anything. But the second fund, because we’ve already got that. The first one, and that’s doing well. The second one has already got great traction and momentum, and we’re about to announce the first asset in the fund.

So it’s all going well. And, before we even, we haven’t even announced the first asset in the fund, this is a shell. Of a fund that we’ve announced, we’ve said, here are the things that we’re looking to buy. And here are the markets that we are looking to buy in. And just from that, because of our track record, because of the trust that we’ve built over time, we’ve got millions of dollars in the bank for people waiting to invest with us just because.

they have that trust in us. They don’t even need to know what the asset is. And that’s what I want all of you to know is possible. If you put in the work to build that trust, then eventually it doesn’t matter what you’re going to invest in. They’re going to follow you anywhere that you go. 

Tim Mai: That’s awesome.

How much is your previous fund? How much is this fund? 

Annie Dickerson: So the previous fund was 30 million and this one is around that same range as well. 

Tim Mai: Gotcha. And so I guess I assume you are having fun. Let me take that back. Where do you see this market going, Yeah, what do you see this market going?

Annie Dickerson: That’s the million-dollar question. I see a ton of opportunities. Honestly, I see a ton of opportunities ahead. 18 months ago, seller expectations were here and the market was starting to shift and you know how sellers are. They’re like. No, I still want, let’s say it’s, 50 million. I still want that 50 million.

You said I could get it two months ago and buyers are like, no, the market is softened. I don’t know. I’ll give you 40, 45 and they’re like, no, I want 50. And they’re like, no. 45, I’m going to walk away. And the seller’s no, I’m going to hold out for 50. And then a few months later, as the market continues to go, the sellers are okay. I’ll take that. 45. I’ll take that 45. Come back. Come back. I’ll take that 45. And you’re like no. Now I’m 40. And they’re like, what? You said 45. And you’re like that was two months ago. And so that’s what’s been happening right over the last 12 to 18 months.

That’s the slide that’s been happening and sellers are having to wake up to that. And the perfect example of that is this asset that we are going to announce soon. It was under contract at 70 million. It fell out and we’re getting it for, I think we’re getting it for 57 million. Wow.

Within a short time, right? And that’s what’s happening across the board. There’s all these opportunities starting to pop up. They’re not all over the place yet, but I very much believe that they will be running rampant here within the next 12 to 18 months as seller expectations come in line.

So all that to say, this is the perfect opportunity to get your investors ready and investors aren’t sitting on the sidelines. As I mentioned, we put out this fund, and our investors are coming. They’re ready to invest because they see inflation. That’s what, that’s, what’s going on in their minds.

They’re like, I need to put my money somewhere. It’s losing value. And so it’s, This is the perfect opportunity because these opportunities are coming down the pipeline. Investors are wanting to invest. So everybody here, you have the opportunity to step out. As we talked about earlier in that leadership, let people know this is what’s coming.

And this is the opportunity that you have, and I’m going to lead you in that way. And I’m going to find these great opportunities for you. Come with me. I invite you to come with me. And so that’s where I see things headed. And we’re working hard to position ourselves behind the scenes to make sure that we are ready for that opportunity when it comes.

Tim Mai: That’s great. So with you have already reached, over a billion dollars worth of assets and over a hundred million dollars that you’ve raised. What’s yours? Yeah. Yours as in good eggs, big goal. Where are you wanting to take this business? 

Annie Dickerson: Oh, wow. So recently we did. If I highly recommend there’s a book by Cameron Herold called vivid vision, I highly recommend a short little book. You can read it on a quick plane ride. And the concept of a vivid vision is you look three years out. In your business and or in your personal life, you come up with a very clear vision of what your business is going to look like at that time.

So we recently did this. And in fact, we had all of our team members do it at our recent team retreat too. We had them do it for their personal lives as well. Write a letter to yourself three years in the future. About all the things you’re proud to have accomplished at that point in your life. And people shared and they were tearing up, they were crying because it’s amazing what you can do, what you can accomplish, and the pride that you can take in that.

So as we thought about three years in the future for Good Egg we’ve done a great job so far of speaking to and providing opportunities for Jen and Jen 2.0. We’re starting to branch out into our other newer avatars, Bill and Richard, but we see that so far we’ve provided a great deal of flow, but we always talk about life by design.

That’s the ultimate where we want to get them to yes. Real estate is great, but it’s a stepping stone to get you to this life, this amazing life that you can build for yourself and your family. And so what we’re going to be doing between now and then is building out all those things. We want to build out not just deal flow, but investor retreats, life-by-design summits, investor masterminds, and financial literacy for kids.

So all these programs where we’re taking into account the full investor, not just you, how much are you putting into this next deal that we’re opening up? And we’re also looking at expanding our impact. Something that we were able to do within the last couple of years is start to donate a portion of our proceeds to a nonprofit that’s important to our investors.

So we pull all our investors to see what they’re passionate about. And with every deal that we close, we donate a portion of those proceeds to one of those causes. And so over the next three years, we are also looking at creating a good egg foundation and expanding that impact there as well.

So lots of moving and shaking. 

Tim Mai: I love it. I love it. Yeah, so I mean for the people listening and they want to connect with you partner with you invest with you learn from you get access to all these great things that you’re you guys are doing, where would you like to send them? 

Annie Dickerson: The best place to go if you, especially if you are wanting to get some capital-raising support is our website, therealestateaccelerator.com. That’s our coaching and mentorship program. As I mentioned earlier, basically we open up. Our kimono essentially, and we’ve taken everything in the back end of our business. That’s worked for raising capital. We’ve white labeled it and we give it to you, including now over 80 blog posts that you can copy and paste.

So you don’t even have to write all those emails and turn them into blog posts. You can just copy and paste, and add a little snippet to the beginning and the end. And boom, you’ve got an instant thought leadership platform. And yes, I will put the link in the chat as well here for anybody here. But yeah, through that you can apply and feel free.

You can reach out to me at any time at Annie at good egg investments. com. You can also learn more about our business, good egg investments at our website, good egg investments. com.

Tim Mai: Awesome. Thank you so much for that. One last question for you. What are you teaching your kids that perhaps most parents are not teaching this?

Cause I have two teens, God, I’m two teenagers. 

Annie Dickerson: I’m so glad you’re asking this question. This is one of my favorite questions to ask others as well because we’re in such a unique position to be able to pay it forward and shape the next generation. And I think. Oh my gosh, just all these conversations around entrepreneurship, helping them to think about entrepreneurship in a new way, before COVID, one of the most powerful things I did with my kids was help them to set up a lemonade stand.

And now let me tell you, the most powerful part of this was we had the lemonade stand and within two hours or so it was a high-traffic area. They had about 200. That they had made from lemonade. And I’m like, Whoa, I need to switch my business. Anyway, So they had 200. So we get home, we pile it all up on the kitchen table and they’re thinking, Oh my gosh, I’m rich.

Like I could just, Oh my gosh, I quit everything and just do this. And they’re starting to grab the money. I’ve got two, two young boys. And I was like, Oh yeah. Legos they could buy. I’m like wait, Remember, I bought that jug that holds, held the lemonade. That was 40. Let me take my 40 back.

What about the cups? We paid for the cup. Let me take that. And the napkins, right? And we’re slowly watching the piles of cash go down and they’re like, what? What? What’s happening? And I had a frank conversation about startup costs and what that means. And when you start a business.

That’s an investment, but next time, guess what? You don’t have all these same startup costs and you get to keep more. And so I think it’s in little ways like that, where you can show them with real-life examples. I have a good friend, Adam Carroll, who did exercise with his kids, teenagers. He went to the bank and he actually, we all know mMonopoly

He got the same denominations as Monopoly has in their play money in real money. He went to the, he got like however many, like a hundred ones and 55s, whatever it is. And he had his kids play Monopoly with real cash. And he found that the decisions that they were making with real cash were starkly different.

From with play money. So to the extent that we can give our kids these opportunities to test things out and to make mistakes while they’re living under our roof and while we can be there for them. I think that’s going to make a difference as they go out in the world. 

Tim Mai: Wow. I love that.

That’s awesome. Annie, thank you so much for doing this interview with me today. It’s been. Phenomenal. I love it. It’s one of my favorite interviews. Yeah, you’ve been so generously sharing and giving your knowledge and I appreciate you for doing this interview with me today.

Annie Dickerson: All right, back to you. And thank you to all the listeners, everybody here in this session lives as well. It. Makes my heart so happy to be able to share with you. These are hard ones that we’ve learned and tested through time. And I want nothing more than to share it with all of you so that you can see success too, because I fully believe a rising tide lifts all boats and we’re all in this together.

So again, if there’s anything I can do to help you with your business or even connect you with anybody in this space, feel free to reach out anytime.

Dan Handford: To be a successful capital raiser, you just have to be yourself, right? And there are going to be people that will be attracted to you. There’ll be people that will go in the other direction. Don’t worry about the people that are going in the other direction. Just be you. Tim is one of the most authentic and genuine people I’ve ever met.

Sincerely believe he’s coming from a position of giving and that means a lot. You’re going to make huge progress. 

Tim Mai: Welcome everybody to today’s Capital Raising Show. I’m your host Tim Mai. And today I have an amazing guest coming on with us, Dan Hanford. Dan spoke at our event this past weekend with his son.

Caleb is 10 years old and yeah I’m super excited to interview Dan and specifically ask him more questions around what he’s teaching his kids right, how he’s teaching his kids to invest and so I’m gonna share with you Dan’s bio here real quick. Dan and his wife Danae along with their four children three girls and a boy resign from work in Columbia, South Carolina.

Dan has an extensive successful background in starting multiple seven-figure businesses. from scratch with a large group of non-surgical orthopedic medical clinics located in South Carolina. His family of companies have annual budgets of over 10 million dollars. Large operations that Dan runs.

Dan’s the founder of the multifamily investment nation where he educates A nationwide group of over 40, 000 members on multifamily as well as self-storage, of those types of assets. Dan is a managing partner of PassiveInvesting. com, a private equity real estate company. investing firm acquiring large 20 million plus apartment complexes and self-storage facilities across the southeast using private accredited investors fund.

Since 2018, his company has raised over 530 million dollars with a 1. 3 billion dollars asset under management. So with that, let’s welcome Mr. Dan Hanford. 

Dan Handford: Yay. Thanks for having me, Tim. I appreciate it.

Tim Mai: Yeah, I would like to jump right into talking about your son. We got a lot of feedback from the events and that was the highlight of the event so love to hear from you.

What are you teaching your kids that perhaps a lot of parents are not teaching their kids and how can we all incorporate that? 

Dan Handford: Yeah, I think one of the biggest things is making sure. That you teach them about finance at an early age, and even if I always told my wife, I said, once they turn 5 years old, they’re getting a bank account.

So I want to make sure that they can have that bank account. I want them to be able to. Sit down with them and show them kind of what income and expenses are and how they can put money in and how they can pull it out. And, I act as their bank. Instead of I don’t go to banks anymore I don’t know how many of you go to banks, but it’s been a long time since I stepped foot

And for me, whenever they want to deposit in their bank. I don’t necessarily. I don’t act as their account, but when I was saying they have an account like we are, we beg with first citizens. So with 1st Citizens, each 1 of the kids has their bank account but when they deposit it, they basically send it, give it to me and then I take it, move it from my account, and put it into their account.

So I don’t have to worry about going into the bank or anything like that. I just take the cash or whatever that they earn and just put it in my pocket. And so I explain that to them as well about how I’m pretending like I am the bank and how I’m doing it and I’m processing it and then whenever I make transfers or deposits for them, I always make sure I can print out the order, not only I say print out, but I will show them my two older kids have emails.

So I will email them with their statements and things like that. So they can have a look at it and keep track of it. Thank you. And then I’ve told all of them that once they reach a thousand dollars I will allow them to be able to invest in one of our properties and they don’t go in and sign all the PPMs and the documents and stuff like that.

They’re again investing through me, but I allow them to be able to see the investor pitch decks and they get the monthly updates. They get the distributions. I want them to see all of that happening so they can get that. So they can like it, so they can see what that feels like. And so that’s the biggest thing that we have done is, making sure that they have a bank account teach them how to save, how to make sure that they’re, they’re giving and tithing and things like that for our local church and making sure that once they have kept track of their capital, I, one of the most challenging things when you have money, Is to do a disservice to your children by buying them things that they should be buying for themselves.

And it’s a challenge because, for me, it’s a lot easier just like, when they turn 15 or 16, when they start driving. It’s a lot easier for me just to go down to the car dealership, buy a car, right? Go down there, pay for a car, and be done with it. But I’ve sat down with my kids and I’m like, you will enjoy it.

Driving that car so much more if you put the work and time and energy and effort into earning the money to be able to pay for that car. So we will have a family vehicle that the kids can use if they need to use it or whatever, but I want them to be able to buy their first car, right?

That’s usually like most people’s. The first major expense is a car, right? But I want to be able to teach them that so that they can do that on their own. And I know that long term that will benefit them long term as well, because they’re going to now know how to earn money, right? My oldest daughter has a cookie business, right?

So she goes around and has order forms and they’ll fill out the forms and she changes them based on the seasons and things like that. And she’s not earning a ton of money, but for a 12-year-old, she’s probably earning a couple of hundred dollars a month, and she does something that she likes.

She enjoys baking. She enjoys that piece of it. And she’s also now recruited my son to help sell cookies for her. So now I earn a little bit of a commission on selling cookies, but then I taught my daughter. I’m like, listen, like. When you sell these cookies, you can’t be baking them. So you need to have a Salesforce.

And of course, I’m like your son. I mean your brother Caleb can be part of your Salesforce and teach him how to go out there and sell. I think one of the greatest skill sets that we can give our children is the ability to sell, right? Whether they’re selling themself or they’re selling something to somebody else, that’s one of the greatest skill sets that somebody can have.

And so that’s one of the things that we try to instill in them is the ability to communicate. And sell and even to the point of being able to write properly. My son, my wife is a former school teacher and she comes from a long line of school teachers, her parents or grandparents, great grandparents like it’s a long line.

And I told her when we first got married, we’d been married for 14 years. I told her, I said, I’ll take care of it, earning the money and the finance and that kind of stuff. And, she still worked when we first got married and stuff like that. As far as outside of the home, I’m not saying she doesn’t work now.

Don’t get me wrong. She does. But one of the things that I told her is I want you to be able to make the decisions around our kids’ education. And so one of the things that she said is that she wanted to make sure that we were able to teach our kids for an entire year and homeschool them.

But she didn’t want to do it when they were too young, because she didn’t want to have to worry about teaching them how to read and write and do the math, but she didn’t want to wait until they were in their teenage years when, at that time, mom and dad aren’t cool anymore. So you don’t want to hang out as much, hopefully, we can mitigate that a little bit, but so the fifth grade is like that, that perfect medium, medium year, if you will. And my son was actually on the plane flying back and forth to Dallas, he was writing a paper for his homeschooling class on his computer, on his laptop.

And I asked him, I said you I, at first I read it and I was like, wow that’s good. So I’m like I’m surprised you wrote that, and so of course I read through it and I found a few little mistakes here and there, and I said, I said I said, daddy, you like to write.

I said I enjoy writing. I feel like I’m a good writer. I feel like I can communicate well. And I said he said he doesn’t like it. He goes, and I said what don’t you like about it? And so I don’t like all the grammar and all this, all this, all the different pieces that, that you have to learn to be able to understand how to write and how to be, how to, and how to communicate properly and the whole language aspect of things.

And I said I said it’s very similar to. So last weekend we were in Nashville on Wednesday night before we came to Dallas. And we were watching the piano guys. I don’t know if you guys have ever heard of them or if you’ve ever seen them in concert, but if you haven’t, go to YouTube, and type in piano guys, it’s phenomenal.

We went and saw them in concert there. And then, I know it’s called piano guys, but they have one of their primary guys as a cellist. So my son plays the cello as well. He also plays the trombone, but he likes the cello a lot. And of course, one of the things that the guy on stage said was that he was talking to the kids specifically.

And he said playing the cello or learning the cello is very challenging. And it can be quite boring. But he said 1 day. All of a sudden things will just click and you’ll be playing and it’ll just be like you’re on a cloud. You’ll just be like, it’ll just be like, it’ll just be amazing for you, and of course, that motivated Caleb a little bit more on that side of things.

So I made that connection with him with language and I said, listen, that’s a very similar analogy to language where you’re learning all these different nuances and pieces and it’s just frustrating. But one day you’ll get all that stuff put together all the pieces will come together and you’ll just start to write, and it’ll be like natural for you, and so be able to teach them that kind of skills I think is very important, which is one of the reasons why we are homeschooling that we did my daughter last year she’s 12 years old but she did we homeschool her last year had a great time doing that.

This year has been a little more challenging and having a boy homeschooling him a little harder to focus on the intention, but it’s been good for us to have him around and be able to, take him to different events and then expose him to a lot of different things and being able to teach them a lot of those different skills.

I think bringing them to events. I don’t think we bring our kids to events like you had last week enough. Myself included, right? I’m not saying I’m not pointing the finger at everybody. I’m saying, if you have kids, I would encourage you to bring your kids to events like that. Get them around people that are talking finance, that are talking real estate, that are talking investing.

And so it becomes second nature to them. My parents didn’t teach me any of that kind of stuff. I had a bank account and I learned some of that, some of them, balancing a checkbook. And then I got into high school and I had a class that I had to do like home finance or something like that.

And I was bored to death because I already knew all of it. Because my parents have taught me all that piece of it, but I never learned anything about investing or real estate or the stock market or the economy or anything. Those are things that I’ve been very. Diligent about making sure that our kids fully understand and are aware of.

Tim Mai: That’s awesome. And your kids sound quite fairly young. How old are they? 

Dan Handford: So we have four of them. We have a 12-year-old girl. We have a 10-year-old boy, Kayla. So you guys met last week. And then we have a six-year-old girl and a four-year-old girl. 

Tim Mai: Gotcha. Okay. Yeah. Yeah. That’s it. That’s fairly young.

That’s awesome. And then in terms of their allocations, like how much to tie, how much to save, what kind of allocation do you recommend for them or teach them? 

Dan Handford: So right now we have at least 10% going to tithe. And then the rest of it goes into savings. And whenever they want to buy something, of course, there are things that we will, of course, buy for our kids, but there are certain things where I’m like, I can’t use the phrase we can’t afford it because the kids, I’m very upfront with our kids.

I don’t try to hide anything from them. They know we have money. They know what my net worth is. They know how much money I have in the bank account. They know everything right. My parents never told me any of that stuff. And so I’m like, I want my kids to know. I don’t ever want there to be a question about it.

And so I can’t, I joke with them sometimes. Oh, we can’t do that because we can’t afford it. And they’re like, give me this look like, yeah. Okay, Dad. Yeah. Whatever. But I want them to be able to have the joy of earning money, saving it, and then being able to spend it on things that they want to spend.

And I have some of our kids that love to spend it on other people. Like they would drain their account. Spending it on somebody else. And that’s a whole nother like the educational process to those kids, to that child. To teach them that, yes, we want you to be loving and caring and giving to other people, but you can’t give everything away.

You have to save some for X, Y, and Z. And so being able to have a bank account. And actually, it’s my six-year-old right so it’s my six-year-old she’s. She’s got like the heart of gold. She just wants, every time I come home, she always tries to give me something and it doesn’t matter what it is.

She’ll find a rock in the yard. And go, Hey daddy, I got you a little rock. I got you something from the yard. She’s just, she just loves to give. And it just reminded me this past Sunday, I’m going to, oh, we’re all getting ready for you to go to church. And she comes into the bedroom and is talking to my wife and she is getting ready.

And so she’s going by her name Chloe. So Chloe’s going through her list of things that she has done to get ready for church. And she’s like, all right, I brush my teeth. I put my clothes on. I got my, my, my shoes on. They’re all ready. My hair is all done. And I got my gift for some, it was her name is Lois.

I got my gift for Lois when I got to church. And that’s part of her light of getting prepared in the morning is, yeah. Giving something to somebody, which is a, which is a great kind of personality training skill set, but we have to teach them like, you can’t just spend that on everything on everybody.

Even like me, my son, and my other daughters. If they want something, I always ask them, “How much do you have in your bank account? Can you afford to pay for that? And even just this past week, my daughter was buying a Christmas present.

She wanted me to buy it on Amazon. So I went on and we picked out what she wanted and I ordered it and I told her, all right. It was 20 and 11 cents. And she runs up to her room that she hadn’t given me all of her cash just yet. So she ran up to her room, got her 20. 11, and came down and gave me 20.

11 out of her, out of the money that she had earned. And, yes, can I pay for that for her? Yes. But the joy, you guys know this if you get something from somebody else. Or if you try to give something to somebody else, a present that you didn’t buy, it’s not as special to you as if you went out and earned the money and bought the thing and gave it to somebody, right?

And so it’s more impactful when they’re spending that money, spending their own money to be able to impact other people. 

Tim Mai: That’s awesome. Have you considered or planned to have some kind of a family fund family trust that you know that you and the kids invest out of that trust and they get to be on the board of advisors and make the decisions as well?

Dan Handford: Yeah, we’re actually in the process of setting up a private nonprofit foundation that they will control and run after we’re dead after my wife and I pass away and that helps to avoid the estate tax as well, because if you donate that while you’re alive into this nonprofit, then it can reduce your overall Oh net worth so that you’re not having to give 40% anything over above 12 million.

You’re not having to give 40% of the estate tax. And so that’s 1 of the things that we’re setting up, but we can also set it up so that they can be up-served on the board. They can start, they can direct the investments and I can teach them that now while I’m alive to be able to do that.

But then I can also pay them a nice salary or whatever out of that nonprofit to be able to do those different tasks. And that allows them to be able to do whatever they want to do with their life. They don’t necessarily have to go and be an entrepreneur or be a real estate investor or go and earn money.

They can go and be a missionary overseas. They could go and just volunteer at a different nonprofit. And they don’t have to worry about a certain wage that they’re going to be earning to be able to. decide as to whether they can or cannot do something because of that particular barrier if you will.

And so that’s something that we are setting up right now. We don’t have it set up just yet. We are setting that kind of public, excuse me, private nonprofit foundation specifically for that purpose. 

Tim Mai: That is awesome. I love that and that’s just giving me a business idea out of that because I’m negotiating with a seller right now, 2400 acres of land 60 million.

He’s in his 90s, and we’ve been talking about different tax strategies and so he has two kids that would inherit this money and something like a structure like this would definitely. Part of that, I guess, would make sense, but that’s awesome to hear that. So let’s talk about your background.

You have started from scratch, several very successful businesses. Can you share with us some of those businesses and then also how the success in those businesses is now helping you in this real estate syndication business? 

Dan Handford: So one of the businesses Early on that I started wasn’t, but I was in chiropractic school.

So I’m a chiropractor by trade. I just gave up my license this past year, which was cool to be able to do. It was one of those things where I’ve been wanting to do it for a while but just didn’t know for sure if I’d ever need to fall back on that. So I kept it up and I just decided my wife and I had sat down and discussed it.

And instead of having to continue to do the continued education and things like that, I just decided to go ahead and give up that license. But I started in chiropractic and while I was going through schooling, I started a business selling spine models. So it was a business called shop anatomical.

I still have the business today, shop anatomy. com. And we sell all kinds of skeletons and skulls and brains and hearts and all kinds of plastic models for colleges, universities, and doctor’s offices across the world. And with that, I started that in chiropractic school because I heard when I was in some of the classes.

When I first started, I heard a lot of the students complain about how expensive the spine model was in the bookstore because you need a spine to be able to learn all the different articulations and things like that and adjustment points. And so I went down to the bookstore and. I think it was 190 a spine that they were selling.

And I went online, found the manufacturer, and saw that the manufacturer’s retail price was 90. So the bookstore was increasing the price by over a hundred dollars. Of course, I knew they were getting it for cheaper than the 90 because they were a distributor. So they’re getting a better rate. And so I went directly to the manufacturer and said, Hey , if I can get an order of 20 of these spines together, what would you get for me?

What could you sell them to me for? And they say we’ll set you up as 1 of our dealers. And because you can do that, I told him I could do it like 3 or 4 times a year because. New students are coming in every year. They did it in quarters, not semesters. So usually four people, four new students come in every year.

And so I told her, I’m like, I can do it, I can probably do that four times a year. And she said I’ll go ahead and set you up on our top-tier discount. And I’ll sell you that spine, including the shipping for 42 and 48 cents. And so I’ve put my kind of background in building websites and web design, web hosting, networking, things like that.

But that skill set worked and built out a basic website. We have developed to accept payments. And also created some flyers and stuff like that. I went. Each one of the classes got in front of the classroom and told him about this spine model. And they’re going to be able to save a hundred bucks.

I sold it for 69, 95 is what I did. And I gave him the, I included the shipping and I even threw in like an anatomy chart with it to like a skeletal chart or something. And within the first week, I sold 80 of those spines with cash in hand up front. And then the next two weeks I sold another 40.

And that was really what started that whole business shopping anatomical dot com. I was able to pay my way through college. I was able to start my clinic when I first got out of chiropractic school. I started my clinic right out on my own and was able to use the profits from that business to be able to start that next business.

And even today, we have a group of medical clinics. We don’t do chiropractic in them anymore. I don’t run the day-to-day operations. I have a good CEO who runs it. He’s been with me for probably 6, 7 years now. And he runs the day-to-day operations, but that business allows us to start the chiropractic business.

which eventually morphed into the medical business where we do a lot of prolotherapy PRP stem cell treatments for orthopedic conditions. We do a lot of non-surgical orthopedics and sports medicine, and those clinics are a hundred percent debt free. And so that creates a problem that creates a tax problem because you don’t have the write-offs from the interest on the debt to be able to offset some of your income.

So now you’re paying a large chunk to the government. And it wasn’t just once a year, it was four times a year with the quarterly payments. So we’re writing large six-figure checks every quarter and it was getting frustrating. And I decided that I wanted to start investing in real estate because that would allow me to use the depreciation to be able to offset some of that income.

And especially, having a real estate professional status allows you to offset all of that income. And so in 2018, I decided to step away full-time from our clinics. I promoted my COO at the time, who is now the CEO, and told him I was stepping out. I made that decision on a Friday, told my wife about it on a Saturday, and then on Sunday, I called the COO and told him about it.

On Monday, we made an announcement to our team, and I stepped out, and I haven’t stepped foot in the clinic during business hours since then. So it’s been running. I don’t want to stay on autopilot. For the most part, it is because my team is running it. I’m just not having to go in and I still have a corporate meeting with them once a month to make sure that I’m looking at the KPIs and the numbers and the stats and making sure that my vision for the clinics is still moving forward.

And we will likely exit those clinics and sell them in the next, probably, 1 to 3 years, somewhere around there. But the income from those clinics is what allowed us to be able to start investing passively in real estate syndications. So we invested passively first.

Hired a mentor in the space and started to learn how to do it myself, did some co-GPs with a few other groups, and did three deals with those two groups. And then in 2018, we started our very first and closed on our very first acquisition of a 130-unit property out of Greenville, South Carolina.

And we bought it for $8. 9 million and I think we recently sold it for close to about 13 and a half million, somewhere around there. And made a nice, we were able to outperform the projections for the investors on that one and everything. But we were able to build our track record, build our credibility through the most, the brokers as well as the sellers.

And it allowed us to be able to continue on the trajectory that we are on right now. And in that first year with the first deal that we closed plus the Cog P money, we raised right at 4 million in 2000, and in 19, we raised 32 million. In 2020, we raised 61 million. Last year we raised 196 million and this year we’ll have just crossed over the 290 million mark raised just this year alone.

So that’s where we come up with that little over half a billion in equity that we’ve raised since 2018. 

Tim Mai: That is impressive. Super impressive. Before we talk about the raises that you’ve done when I met you in person, I knew of you, I knew of you for a while but I met you in person at your event in Charlotte, a few months ago back in July.

And right off the bat, you’re super approachable. You’re very easygoing. And then when, when I invited you to be interviewed on this show and speak at my event, you were very open to all of that. And like your personality and even you even offer to help promote the event, like you are just very generous that way.

Have you found I’m sure you have, but I would love to hear how that has played a role in your ability to run successful businesses and your ability to raise a lot of money. 

Dan Handford: It is. When I sit back and think about it, it’s just who I am. And when, we, when I spoke last week at the event, we know one of the things I mentioned there was.

To be a successful capital raiser, you just have to be yourself, right? And they’re going to be people that will be attracted to you. They’ll be people that will go the other direction. Don’t worry about the people that are going in the other direction. Just be you. I know there are probably people that don’t like me, but you know what?

I don’t care. I know there are going to be people that don’t like me. Matter of fact, I have people that I don’t like, right? There are people in this space, not on this webinar for example, but there are people in this space and multifamily that I do not like. I don’t want to be around them.

I don’t want to be associated with them. Am I still nice to them? Sure. I’m going to still be nice to them. That’s just who I am, right? But there are certain people that I am, so I’m just saying that there’s going to be people that aren’t going to like you. And you just have to make sure that you are being true to yourself and you’re being authentic because people can see through that, right?

If you’re not being authentic and you’re not being yourself, they can, it’s just, and it’s weird because sometimes there are people that I meet and I’m like, I don’t know what it is about that person, but there’s something’s off. I don’t know what it is. And so I have to distance myself from people that are like that because every time that I’ve tried to go against my intuition.

Or my wife’s intuition, it’s always come back to bite me. And so I’ve made a policy that if. If I have something like I can’t put my finger on that is just, it just makes you go. I don’t know what’s wrong with that person, but I don’t want to be around. Then I’m not going to be around. And it’s not just people.

It’s opportunities and it’s different things that come across your desk where it’s that deal just looks, I don’t know, something’s wrong with it. Sometimes you can’t put an exact finger on what it is, but you just so to go back to your question about how my personality goes in with this.

I will say that one of the things that can make it without that will make you successful as a capital raiser is the ability to communicate and communicate effectively. And if you are not a good speaker, if you’re not a very good communicator, you should work on those skills. You should work on those, that, those, that, that set of skills and there’s.

groups out there that can help you and can teach you and guide you in that. I feel like I’m more of a naturally gifted person when it comes to that. Because I never had any formal training in it. Yes. I had speech classes in high school and things like that. I never went to Toastmasters International or some of those different, well-known speaking groups, which I think are great groups.

I know a lot about those different groups. I’ve referred a lot of people to those groups, but. I think that’s one thing, Tim, that a lot of people don’t focus on is the personality that it takes. To be able to raise a significant amount of capital, it doesn’t mean that if you don’t have that personality you shouldn’t raise capital, it just means that you need to find somebody else on your team that can help you with that skill set and have something that has that complimentary skill set, whether it be a staff person, like a team member or whatever.

Or if it is a partner that can help balance out some of your skill sets because usually, the person who’s doing the underwriting enjoys that they’re more of an analytical type person, and they’re not usually going to have the personality that’s going to be very strong to raise capital. And I’m just being frank with you because that’s usually how it is that the more analytical kind of underwriting, they geek out over that stuff.

They were there that the ability to have the personality to raise capital is not usually. Tied up. Now, it doesn’t mean it can’t happen. I’ve met some people that are underwriters that do that, but I’m just saying that’s not the norm. And I think that’s one of the things that’s helped our business be so successful [email protected] is that we have three managing partners and each one of the managing partners has, it’s their skills that are complementary to the other partners.

The challenge that a lot of people get into is that They go to different events and different conferences and they meet people. So let’s just say you’re a person that likes to underwrite properties, right? You just love that stuff. You just like you, you can do that all day long. You just love it. You just geek out over it.

Then you go to a conference and you find somebody else that loves to do underwriting and likes to geek out over it. You guys hit it off. That’s it. The worst person to get into business with. You do not want to get into business with somebody else that does the same skill set that you have. You need to be finding, now that’s a great person to be friends with, it’s a great person to like, have them check your underwriting when you’re done or whatever, but it’s not somebody you want to go into business with.

You want to find somebody who has a complementary skill set to you so that you can balance each other out. It’s the same thing in any type of relationship, whether it be your marriage relationship, whether it be your friends, or whether it be if you’re going to start a business somewhere else, those kinds of complementary skill sets are very powerful in a lot of different businesses and a lot of different relationships that you might have.

And so for us, that’s what we try to do is try to find some of those complementary skill sets that we can, so we can work well together. 

Tim Mai: That’s awesome. And are you the one in the partnership that does all of the marketing and all the investor relations? Correct. Very cool. In terms of marketing, if you’re looking at your investor pool of investors that have invested with you, where would you say are the top two or maybe the top three marketing channels that have attracted the most amount of them?

Dan Handford: You’ve opened up a can of worms with that question, Tim. Cause let me lemme, let me answer it this way. Okay. There is not one thing that we do that consistently provides a significant amount of leads. And I say that because a lot of times we go to conferences and we ask that question, right?

Because it’s a valid question. What are you doing that gives you, and brings you the most stuff, but the most investors? And to me, the question should more or less be, what are all the things that you’re doing to be able to attract investors? Because I believe in what’s called a multimodal approach to marketing that you can bring in.

People from your different marketing sources can be very impactful. Let me give you a story that will hopefully allow you to connect with what I’m trying to say here. It’s probably been about 10 years now. My wife and I went down to Sanibel Island, Florida.

That has now been demolished by Hurricane Ian. But that area in Sanibel Island, Captiva, that part of the Fort Myers, Florida area is just. An amazing area. The water is just crystal blue and green. It’s like it’s just a great spot. We had never been before. And so we wanted to go visit.

And we ended up, we drove down. Yeah, we drove down to Sanibel Island. We were going to spend 10 days down there. And so we got and if you’ve ever, if you know anything about that South area, there’s a resort there called the South Seas Island resort.

And we stayed at the resort and we had a balcony and we could jump off the balcony into the Gulf of Mexico. That’s how close we were to the edge. It was a great spot. And every morning we would wake up and we would enjoy a cup of coffee in the morning. So we had our cup of coffee and then my wife would get her book out and read and I would get my book out.

I would read and we’d spend probably, I don’t know, probably 2 or 3 hours every morning, just relaxing and reading our books. And in front of our balcony was the shoreline. Like I said, And there was a little bit of a, I don’t want to say it’s a pier, but more like a dock. So it’s just right there and didn’t go very far.

And every morning we’d see 1 or 2 people come out there and they take their fishing rod out there and they throw their fishing rod out and they, they try to catch something and not 1 person caught anything and then Three or four days into this, I, around the corner of one of the buildings, I see this guy coming across the building and he’s got a wheelbarrow full of like all the like bait and tackle and whatever else you need to do to go fishing.

I’m not a big fisherman person but anyway, he had all this stuff, all the gear, and he had 15 fishing rods in the back of his wheelbarrow, right? And right behind him when he was walking, he’s like carrying this thing going walking down the sidewalk right behind him is his wife and she is, of course, got a book open in this reading the book as she’s walking and he goes and there was like a little bench right off right before you got to the pier or the dock.

There was a little bench where you could just sit there and be right by the water. He pulled his wheelbarrow up and put it right behind the bench there and his wife came around and just sat on the bench. And then he got, he started putting his fishing rods out to get 1 fishing rod out, throw it out there.

And then put it into the ground, and then he’d get the other one out. So I was fishing right out there, put the, put it in the ground. By the time he got like 12 of them in there, one of them started to bite, right? And so he runs over there to try to get the one that’s biting.

By the time he gets that fish off, Another one starts to bite, and then another one. And now he’s like recruiting his wife. We’re all watching this going, what has just happened here? And it hit me because that’s the exact approach that we should take when we’re marketing for investors. You cannot just rely on one or two things and do the same thing that everybody else is doing.

You’re gonna go to the same spot, try to get a fish for the same investors in the same spot that everybody else is fishing for. You gotta start thinking, be thinking outside of the box, and try to find some ways to be able to reach investors that not everybody is doing.

And as far as the multimodal approach, the challenge with that when people first get started is that they go, yes, I want to do a multimodal approach. Then they go, where do I begin? Cause how do you do a multi-modal approach with one thing? It starts with one thing. You start with one thing, keep that thing going, start the next thing, keep that thing going.

And you continue to build on that. And there’ll be some times where the podcast brings us more investors one month, and then the next month it might be our YouTube channel, or doing events like this, where I’m in front of other people or speaking or. Whatever referrals or whatever the case is, there’s never been 1 thing that we’ve done where I can go.

That has been the reason why we’ve been so successful. The reason why we’ve been so successful is that we have a multimodal approach to marketing and a multimodal approach to reach investors and can use that same philosophy in the marketing aspects of reaching residents to live at our properties as well.

So there’s this not, this isn’t just stopping here. This goes into multiple different aspects that we have for this type of business. 

Tim Mai: Very cool. Now when I first found out about you, you were doing a lot of virtual events, and now I see you’re doing live events now. Are you going to continue to do the virtual events as well?

Dan Handford: No, we are not. So we have decided to only focus on the once-a-year events. In June, and it’s going to be right now is where we’re planning on still having it in Charlotte for the time being. 

Tim Mai: Gotcha. Any reason why you’re moving away from the virtual event model? 

Dan Handford: Part of it is mostly just about the time and the headspace of putting together a virtual one and trying to do the in-person one.

Because putting on an in-person event is a lot more work. And we still do. I don’t want to say they’re technically virtual events where we do weekly webinars. We’ve been doing free weekly webinars for, I don’t know, since at least 2019, the beginning of 2019 is when we started those.

And I just did a webinar today. 230 people were part of that webinar, right? And usually, about 20 to 30 percent are new people. The rest of those are people that have heard you before or heard a webinar before, but if I can every week continue to do these free weekly webinars, I’m getting in front of 30, 40, and 50 people a week.

That’s powerful for us, right? And depending on the topic will attract more people. And then, 1 of the unique things that we’ve been doing lately is we’ve been doing joint webinars with other groups that are similar in size. So they’ll, we’ll come up with a topic that we can teach our passive investors.

And then I’ll email all of our investors, they’ll email all of their investors, we’ll invite them to this webinar. And whoever comes to the webinar, we share the list. And of course, that’s another way that we’ve been able to build our list as well as being able to like you said earlier on, just try to be very giving and open with our investors. And I’m not just going to invite anybody to do that. But I think a lot of people sometimes get too protective of their investors to the point where they don’t want to recommend anybody.

And most of the people, not most, all of the people that we’ve done joint webinars with, I have invested in their deals. So I trust the group. I invest in their deals and sometimes multiple deals. And so I can recommend them and on the opposite side. Those people have invested in our deals.

And so they know our group. And so it’s not just a, I’m getting anybody that I meet at a conference to do a webinar with just to get their investors. I’m doing it to be able to build our investor base, but also make sure that our investors are investing with people that. Okay. I invest in that.

I trust, right? Because at the end of the day, I want to make sure that people we recommend are going to be good quality people that we can, you know, trust and put our own money behind. 

Tim Mai: That’s awesome. And so that way we don’t forget later. Do you want to share a link so that way the people listening in can check out your webinars?

Dan Handford: Go to multifamilyinvestorNation.com. And that’ll bring you up to our webinars. I just did one today on equity waterfalls for apartment syndication next week. I think we’re doing one of the steps around multifamily acquisitions. We have one, our senior multifamily analyst Chris Neary, who’s going to be doing that one.

In the beginning, I was doing all the webinars and then as we continue to grow our team, we’re up to 45, a little over 45 people now that work full time directly with passiveinvesting.com. We’ve been able to leverage our team and allow them to be able to start to educate and teach as well.

Tim Mai: All right. And then in terms of joint ventures with other operators do you also look for co-GPs at all whenever you do your race? 

Dan Handford: Yes. So we usually have between about two to three co-GPs that’ll help us out. Most of the time, it’s groups that we have already worked with multiple times.

And we have a few that pretty much have helped us out on every single one of the projects that we’ve ever done. We are typically the ones that raise the majority of our capital, but we do have a few of those groups that do participate with us. We have a few others, we have a few new groups that want to invest or, JV partner with us and CoGP.

We have a little bit of different criteria with it. So what we had to do with it. With the type of education that we do, we have a lot of people that want to raise money for us. And so we only allow people to raise money for us if they have had a track record of raising money for another group and they’ve raised at least 1, 000, 000 dollars or more on a single deal.

And they have that track record for it. And so we don’t want to have. Compliance issues down the road if we have 30 people raising 250, 000 on our projects, we want to make sure we have people that can raise over 1M dollars typically between about 3 to 5M, and that we can be able to grow with us and we can also grow with them.

Tim Mai: Gotcha. Okay. And then we talked about the marketing channels, what about the avatar of your passive investors? Do you have the bulk of yours, since you, you came from chiropractic would be the bulk of yours. Do they have physicians, or do you what’s a mix of your investors?

Dan Handford: I would say the majority of them are more business owners.

Business owners, entrepreneurs, real estate investors, and we have, we do have some positions, quite a few attorneys, engineers, professionals. That’s a good, pretty good mix of what we have. We also have some cool celebrities that have invested with us that you would know.

We also have some Fortune 500 CEOs that have invested with us. A lot of those are referrals from other investors that have invested with us, which is pretty cool to have but that’s pretty much the avatar that we have. I would say it’s still skewed more, 50 plus as far as the age range, for sure.

Tim Mai: Oh, very good. Very good to hear that. And so 50 plus let’s, do you. Do you intentionally do your messaging to resonate with that age group at all or is your messaging just more general and then it just so happens that the 50-plus are the ones that you have the most of?

Dan Handford: I would say that the language is geared towards that kind of an avatar because there are people that are in that age range that are dealing with things that.

People in the lower age range are not. It’s not necessarily that we don’t attract those lower-aged people. I’m 39 myself, right? I’m not 40 yet, but I’m getting there. Some days I feel like I’m more like morem. I’m already 40 if you will, but, for the most part, the marketing is very dialed into that specific audience.

I will say though, that we don’t. We don’t market. One of the things that is a big hurdle and challenge is trying to attract and market for people who have no clue about real estate investing. One of the most challenging types of ways to raise capital is to educate people who don’t know how to don’t know anything about real estate.

I’m not saying it can’t be done. I’m just saying it’s a very challenging path to go down to be able to raise capital. And so our philosophy is, let’s try to get in the rooms of people who already know about real estate investing and want to invest in real estate.

And that way there’s not an uphill battle of teaching them why they should be investing in real estate. 

Tim Mai: Gotcha. That’s good too, definitely good to know. With your goal, you’re already at 1. 3 billion. What’s your big goal? Are you trying to get to a trillion assets under management? Where are you going with? 

Dan Handford: Yeah, so I get this question quite often. And I will say this. And we do have goals of getting to the 2 billion mark and the 3 billion and things like that. Right now we have sold some property. So we’re sitting at we’ve acquired about 1. 7 billion in assets.

We did successfully close that deal. Those 2 deals last week at Myrtle Beach that I mentioned from the stage last week. Those were about an 80M dollar kind of deal together. And we, yes, we have goals to reach and get to that kind of 2 Billion, 3 Billion, things like that. But at the end of the day.

Our primary goal is to find great quality assets for our investors to invest in, that we also want to invest in, and that we can find assets that we can sleep well at night at, that we’re not going to be worried about losing their money or losing their capital. I sometimes think about what we’ve done since 2018 and go, we have over half a billion dollars in just private equity that investors have wired to us over the last four years.

They trust us to make sure that we don’t lose their capital and that we make a decent profit, usually north of 20%. Right Now, we don’t underwrite for 20%, so don’t get me wrong. But the ultimate goal would be to try to find deals that you can do that to you, you can get to 20% or higher.

And so our goal is to really, the bottom line is to grow our wealth and our investors’ wealth from multiple generations. So whether that means we have a billion in assets or 10 billion in assets, I don’t care. I want to make sure that we’re doing the right thing for our investors because there are so many there.

I’ve met so many syndicators that set up their process to make them more successful than their investors. And I want to make sure that when we’re, we are always looking out for our investors and we do that, we do the right thing by our investors, because at the end of the day. I can’t do what I’m doing in this business if I don’t have my investors.

And so I have to make sure I treat them properly. And by the way, I’m also one of my investors, right? I’m usually the number one investor in all of our projects, right? Between myself, Danny, and Brandon. Between the three of us, one of us is usually the highest investor in our properties. And so we, of course, want to make sure that we’re setting ourselves up and our families up so that’s set up for success as well.

Tim Mai: That’s great. I know you haven’t been through the 2008 market crash. And so how are you and with this market that’s changing right now? How are you navigating through this market? Where are you getting resources to know how to navigate through something you haven’t been through before? 

Dan Handford: Sure.

So I will say that we’ve hired some great solid people that have gone through multiple market cycles and even before 2008. One of our strong, strongest team members is our director of asset management who manages all of our assets. And he has a 30-year background in this space and used to work for a large national REIT called AIMCO.

And he managed a three to 4 million portfolio with them and shrunk the team from 12 people to four people and took on more property. He was able to manage them because of the processes and the systems that he put into place. And so that is 1 of the biggest things that we have done is be able to hire people and surround ourselves that are smarter than ourselves.

I think a lot of times as entrepreneurs and business owners we tend to like, not want to hire people that we think are smarter than us. I love hiring people that are smarter than me. I love it. I want to surround myself with people that I can trust and that I know are smarter than me.

That would be, really the biggest thing I would say for us that we’re doing, but I will say this too that one of the things that we’ve done from the very beginning. We’ve always made sure that our deals are well capitalized. What I mean by that is, we typically have between one to four million dollars in operating reserves at every single one of our properties, depending on how much we need to be able to continue to pay the expenses of the property and the debt service for six months.

If for some reason the property goes down to 0% occupancy, it’s done as that’s doing a very good job right now, because we have lots of operating reserves in the bank right now. And if we need to dip into that, but help pay for debt service or extra expenses or whatever we have it. And the problem is right now in the current market, I’m already getting people reaching out to me that have deals that they bought three years ago, and their debt service has now gone so high because they didn’t buy an interest rate cap and they’re coming to us saying, Hey, can you help us?

And I feel really bad for those investors, but that’s what’s going to happen. I think more and more, especially as we move into 2021, 2023, and January. Because those are some deals that I feel really bad for those investors. I hope nobody loses any money, but those are going to be some deals that are going to start to come out.

I think in Q1 and Q2 that we should all be prepared for, and be ready to help. I don’t want to say. Make a bunch of money because I would rather make a bunch of money, but also be able to, those people, those investors not lose their money. And so it’s one of those things where I put myself in those investors’ shoes.

I would like somebody to help out. But it’s going to be interesting over the next several months to see what’s going to happen in the market. 

Tim Mai: Yeah, that definitely will be interesting. So for the folks that want to learn from you, learn more from you, reach out to you, connect with you, partner with you, invest with you, what would you like to send them?

Dan Handford: Sure. I’ll send you to two different places. First, if you want to just connect with me and follow me more and see some of my content you can go to my LinkedIn profile. And you can just go to the link within. com, link within. com. And you can directly link with me on my LinkedIn profile to do that.

And then the other thing is if you’re interested in wanting to invest with us you can go to our website, passive investing. com, top right-hand corner of the website, it is a little blue button that says, join the passive investor club. You can click on that. And join us and one of our investor relations team members will reach out to you, discuss your investment goals and see if our group is the right fit for you.

And then we mentioned about the M f I N the M f I N con coming up in June of next year. So if you wanna go to MFI n con.com, you can find out some more information there. And if you want a promo code, I’ll do that for you too, Tim, for your group here. That’d be awesome.

And you can use the promo code webinar 300, and that’ll give you $300 off the ticket. And we’re gonna have Alex Rodriguez there. We’re gonna have Dr. Robert Cini the book, the guy who wrote the wow book Influence. And then we’re also gonna have the c o of Taco Bell. He’s gonna be there speaking, on organization and leadership and managing a large team.

It’s gonna be a really cool group there. And we’ll have probably about 45 to 50 other high-level multifamily investors that are gonna be there. And last year we did it, we had about a little over 400 people that were at that event. And this year it’ll probably be close to about six to 700.

That’ll be there. But this is an event that’s geared towards really high-level investors really want to take their business to the next level. They want to surround themselves with real others, with other high-level people. 

Tim Mai: Yeah. And I was there last year. It was phenomenal.

And so I signed up only for the last event and my 18-year-old son and I will be there this year as well. So for those of you who are coming, yeah, I’d love to see you there. And then what’s your last word of wisdom that you’d like to leave us all with today? 

Dan Handford: So something that one of my mentors years ago taught me, which has served me well is.

If you can’t measure it, you can’t manage it. And so we talk a lot about our businesses and how successful they are. But if you don’t put in this, put systems into place, but systems in place to be able to measure what matters, then you will not be able to manage that business properly, whether that’s from an asset management perspective or whether that’s from acquisitions or asset management or investor relations, or even just your relationships with your wife and your kids.

It is very important to be able to measure what matters so that you can properly manage it. And you might be thinking how do you do that with your family? It’s all about the balance of family and family, your family life and your business, right? If you’re not measuring how much time you’re spending with your business versus with your family, It’s very hard to manage that, right?

But we can consciously think about the amount of time you’re spending away from family and with family and be able to have that data point to be able to measure. It’s going to be very hard for you to be successful in that piece as well. 

Tim Mai: Dan, thank you so much for doing this interview with me today.

I greatly appreciate you and appreciate your generosity and your wisdom. 

Dan Handford: Thank you. Appreciate it. Glad to be here.