How to Raise $1 Million in Two Weeks! with David Thompson
About David Thompson
- David used to work in technology for Dell
- He’s been investing in real estate since 2012
- David has written an article “Top 10 ways to raise 1 million in 2 weeks”
David used to work in technology but left his day job in 2012 to invest in real estate. At this time his daughters were no longer dependents and so he had more time and support to give to raising capital and finding deals. A friend of the family got him into real estate investing and gave him the skills to get started; however it wasn’t until he found his Coach Joe Fairless that his business really took off. Since starting to practice with Joe David has completed two one million dollar capital raises to support the purchase of over 600 units worth $50 million. Since going full time into real estate David has gathered tips and lessons along the way and he has shared these in an article on Bigger Pockets called “Top 10 ways to raise 1 million in 2 weeks” in an effort to help people new to investing.
Nuts & Bolts:
- Partner with experts
There are two ways to grow your real estate business; you can increase in size slowly by doing single family properties, gaining capital, and then moving up through duplex, triplex, small multifamily and large apartment complexes. Alternatively you can leverage the credibility and track record of your peers. David started off with no practical experience of large apartment complexes but through his connection with his coach he was able to approach the large deals. You can also gain knowledge before experience by reading articles, listening to podcasts or getting a coach. By creating a strong team around you you’ll be able to borrow more at the bank, be lent more from investors and buy bigger deals.
- Have a great project
A great project is a collection of three things; the market, the deal and your team. Before investing you must decide what market you want to look at and one important thing to notice is jobs. Make sure that there is a growing market of jobs in the area and that there are people moving into the area. Next make sure that you have a good deal; check that it’s been conservatively underwritten because it’s better to under promise and over deliver. David also recommends following your gut feeling when looking at deals.
- The contact list is established in advance.
Before you need to start reaching out to people make a list of who you know, this way you won’t be searching around for contact details and wasting time when you need to be making calls. Also make a note of how you know them; social media, networking event, family, friends etc. When you’re raising capital you need to have your life in order because time is short, so you don’t want to be thinking “who can I contact”. When you’re contacting people don’t be offended when they don’t respond because people are busy or your email might have been filtered out of their inbox. Always note who didn’t respond and follow up 2 weeks later. David also recommends that when raising capital be prepared to put in some hard work, unfortunately raising money in such a short time frame is not easy.
- Relationships are key.
The first thing to do is identify where your main contact are coming from; are they old work colleagues or Facebook contacts or from a networking event? Always look for small niches that you might not have first considered, for example David found that he was successful talking to people at his children’s sports games. David also recommends Bigger Pockets which is a social network for real estate investors and although you can’t directly advertise deals on there you can share your knowledge. By becoming visible and giving good advice on Bigger Pockets David was contacted by several people in the group who wanted to invest with him. It’s possible to build relationships from cold if you’re authentic, open and sensible.
- Over raising
Try to over raise by 10-20% which might be daunting but it’s important because not everyone that promised money will be able to invest at the right time. Unfortunately events arise that stop potential investors being able to hand over their money so it’s prudent to raise more money than you need to fill in these gaps. It’s beneficial to have multiple investors because this will help increase your contacts. You want your investors to talk about you to their friends and so sometimes it’s better to have lots of people raising small amounts, rather than one large amount from one person.
Top investing tips
- Most successful habit – Working on his strengths inspired by the book Strength Finders
- Who is your most influential person – his real estate coach Joe Fairless
- Contact – [email protected]
The post RG 048 – How to Raise $1 Million in Two Weeks! with David Thompson appeared first on RSN Property Group.
This post first appeared on Podcasting In Real Estate Properties | Reed Goossens, please read the originial post: here
