Setting Up Your Investor Management Process
Dan Handford, Managing Partner, PassiveInvesting.com
Dan Handford began his presentation by introducing the Investor Triad: A triangle with three points labeled Know, Like, and Trust. Of the three points, he explained that being known is the most important for an operator.
At this point in the presentation, a marching band burst through the back doors and paraded around the audience playing “When the Saints Go Marching In.” Dan used this spectacle to drive home the idea that it is imperative to find ways to stand out from the crowd and to ask yourself what you can do that is different from someone else.
Step 1: Know
Raising Capital: It’s really about raising awareness and bringing people/leads into your inner circle. Try to think outside the box.
Step 2: Like
Courting Phase: This occurs when you’re doing content generation. You’re allowing potential investors are getting to know you more and more in order to develop their trust.
To get investors in front of you, start with what you enjoy and do the most. If you like to write, write blog articles, a book, or a newsletter. If you like to be in front of a camera, start a YouTube channel. If you like to hear yourself talk, guest on podcasts, or start your own. But you have to start somewhere.
Step 3: Trust
Securing Capital: This is the phase where you’re actually asking for the money after you’ve had phone calls with them, they’ve seen your content, and you have had a lot of interaction.
Ongoing Communications: Educate your investors on what to expect from your communications, and actually send them out when you say you will send them out.
Step 4: Know (Again)
Referrals: When investors come up to you and want to refer their friends and family, that’s a lot of trust that someone has to have in you. If you’re not getting referrals, something is broken in the process that you need to reexamine.
Dan Handford Best Ever Podcast Episodes:
Panel: How to Find Investors in 2022
Joe Fairless, Co-founder, Ashcroft Capital (moderator)
Ted Greene, Investor Relations Manager, Spartan Investments
Travis Watts, Director of Investor Relations and Passive Investor, Ashcroft Capital
Jasmine Nazari, Partner & COO, Urban Green Investments
The Top Ways to Find Investors
- Virtual property tours
- Tools like CrowdStreet and Fundrise
- In-person events
Pros and Cons of Finding Investors Virtually vs. In-Person
A great lead comes from in-person communication when you can sit down and look someone in the eye. When conferences went digital, the networking component lagged behind.
How Investor Relations Can Be a Value-Add Proposition
- Analyze investors’ portfolios in written form.
- Generate a holistic idea of the investor and their goals — get to know them.
- Account for these goals when you write back to them.
Structuring a Property Tour
- Discuss what you are going to be constructing.
- Walk viewers through the original deal.
- The idea is to populate in an investor’s mind with granular clarity how it will affect them and improve their cash flow.
Strategies That Have Proven Ineffective for the Panelists
- Attempting to reach accredited investors through Instagram
- Buying databases of investors
- Direct mailers
Additional Effective Ways to Attract Investors
- Reach out through LinkedIn.
- Write a compelling email with three talking points to summarize the deal.
- Write thoughtful content and get it out through other people’s networks (blogs, newsletters, etc.).
- Reach out to IRA custodians, and let your investors know that you are IRA custodian-friendly.
- Obtain a foundational understanding of human psychology to guide your approach to communication.
Panelists’ Best Ever Podcast Episodes:
JF2516: Perfecting Your Investor Relations Strategy with Ted Greene
JF2554: Recession Resistant Assets with Ted Greene
JF2637: Sued for $68M: Cautions of Inflation and Risk Appetite with Ted Greene #SkillsetSunday
Actively Passive Investing Show with Travis Watts
Practical Strategies for Scaling Your Syndication Business
How to Scale Quickly: Keys to Success
- Collaborate and connect well.
- Be easy to work with.
- Focus on what you are good at.
- Have an accountability group.
- Choose partners that have a strong track record.
- Add value to others.
How to Add Value without Money
- Find deals.
- Analyze deals.
- Put down earnest money.
- Sign on a loan.
- Raise money.
- Asset manage.
Track and Monitor Your Progress, Including:
- Deal flow
- Podcasts: If you don’t want to do your own, find ways to get on other podcasts. Track which ones worked well and which ones didn’t.
- Fitness: Without your health, what good is your wealth?
17 Tips to Building a Successful Business
- Meet brokers face to face.
- Tour a property vs. going to coffee.
- Tours — do your homework upfront.
- Engage all third parties prior to submitting offers.
- Be competitive on timelines & EMD.
- Partner with others who have a track record.
- Don’t argue the small things.
- Give yourself ample time to close — always have extensions.
- Raise more money than you think you need.
- Advise investors.
- Wire more money to Title than you think you need.
- Connect and follow up with people you meet.
- Roll with the punches — understand things won’t always go as planned.
- Do the right thing, even if it is hard.
- Hire and trust your team. You can’t do this alone. Give room for your team to fail (which will happen).
- Monitor and manage. You cannot improve what you don’t track.
- Thinking time. Set a time every week where you can be working ON your business vs. working IN your business. Ask yourself: What don’t I see? What am I missing? What skills do I need to learn to be successful?
Mark and Tamiel Kenney Best Ever Podcast Episodes:
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Disclaimer: The views and opinions expressed in this blog post are provided for informational purposes only, and should not be construed as an offer to buy or sell any securities or to make or consider any investment or course of action.