This is a partnership business.
You’re just going to bring various players to the table that have any given skill set or resource that you may need, whether that be money or experience.
It’s just partnering in a joint venture capacity on a deal by deal basis.
Over the years, I have had the privilege of working with some very seasoned investors that have liquidity and experience, so all we really have to do is just bring that deal to the table for them because that’s what they’re needing at this time, and I’m going to show you how to do that.
The percentage of money a person makes, based on his/her ownership percentage of the deal is called an equity position.
The equity positions are just like a pizza pie.
It’s the company dollar that is carved up, depending on who does what.
The investors that brings the cash and the experience to the table and put their name and their experience on the mortgage and help get the loan from the bank, are taking the most risk.
So, it would only be appropriate to provide the lion’s share of the company dollar to them, and whoever manages the property management company, gets a significant equity position because that’s very time consuming.
Despite the fact that you’re not really doing the heavy lifting, supervising a property management company does take some of your time…. Not a lot, but it does take some.
Especially when you’re just starting out and learning this business, it takes some time to make sure that you have your finger on the pulse of the deal, and that it’s running smoothly.
So, whoever oversees the property management company is going to get a fair share of the deal and there’s also going to be proceeds from the cash flow upon sale of the property as well.
So that is all encompassed in the equity position.
It’s typically carved up like:
- whoever finds the deal
- whoever oversees the property management company
- whoever brings the investors to the table
- whoever puts cash in
- whoever puts their name on that loan to get the mortgage (the sponsor)
We’re not just going to partner with any old person.
They have to bring something valuable to the table, something that’s going to compliment your weaknesses.
Basically what we’re going to be doing, which you’re going to be doing, what I’m going to show you how to do, is basically making your phone calls, analyzing deals, making offers, and all along the way, you’re going to want to be networking to find your own private money partners.
If you don’t like making these phone calls, then you just need to partner up with someone who does.
So, it’s this business where you just have to pick up the phone and call people and make relationships and try to find these deals.
As far as partnering, again it’s going to be done on a deal-by-deal basis, and you don’t have to get married to anyone right off the bat.
You can just find someone that you have a good rapport with to start.
Then, as you become more advanced down the road, you can start to have some type of an official business partnership where, whoever it is you partner with that you split everything 50/50.
But when you’re just starting out, you can be a one-man or a one-woman army, and you just network and partner up in a joint venture capacity with different people based on whatever it is you bring to the table and whatever it is they have and that they bring to the table.
You put all the pieces of the puzzle in place and you go out and you buy properties!
That’s how it goes.
Partnering with a large group of people is not recommended unless everyone is bringing something valuable to the table.
Like I said, you can very well be a one-man or a one-woman army.
Because if you’ve got half a dozen people in the group, and it’s really just for the purposes of…
“Hey, we all like this business but we’re all in the same boat,” then you’re just carving up a pizza pie and it’s a very thin slice to everybody in there.
If people aren’t bringing anything to the table, then it dilutes everything.
So, ask me how I know this. I did this once, and it just doesn’t work.
It really doesn’t.
Because you’re going to have some people that are riding other people’s coat tails, you’ll have meetings and some people will be doing more work than others, and some people don’t show up to the meeting, etc.
It’s better if you can keep the fat to the minimum, if you will.
If you’ve got a partner or two, that’s good, someone that can help you make phone calls, someone that can help you analyze deals…
I’ll help you analyze deals.
BETTER YET… I’LL UNDERWRITE THEM FOR YOU!
(Want to know more about that? Click Here)
So don’t worry about not having any investors lined-up, if you find a deal!
(The deal must meet certain criteria however… Investors are not going to buy just any old property.)
If you have not already done so, check out my 2017 criteria.
You can sign-up now and get it, by clicking here.
So feel free to reach out and let’s make a deal!