February 4, 2024

JF3440: Niche Down to Scale Up Your Business ft. Derek Peterson




In this episode, Joe Cornwell talks with Derek Peterson about shifting his marketing firm to focus on real estate, helping operators in fundraising and marketing. Peterson highlights the importance of niching down and authenticity in marketing, and shares his journey in real estate, now overseeing over 500 doors and developing a new project in Phoenix.

Key Takeaways:

  • Importance of Niching Down in Marketing: Derek Peterson emphasizes the critical role of focusing on a specific niche in marketing to effectively attract and engage a targeted audience, leading to more successful fundraising and brand building efforts within the real estate sector.
  • Transition to Real Estate from Marketing: Peterson shares his journey of leveraging his marketing expertise to transition into the real estate industry, detailing how he has grown to manage over 500 doors and undertake significant development projects, highlighting the synergy between marketing skills and real estate success.
  • Value of Authenticity and Building Relationships: The discussion underscores the importance of authenticity in branding and marketing, alongside the power of building strong relationships and networking within the industry to facilitate growth, raise capital, and achieve long-term success in real estate investment.

Derek Peterson | Real Estate Background

  • Head of Adapt Media Agency and 10Y
  • Portfolio:
    • 500+ doors, including 190 unit BTR currently under construction.
  • Based in: Charlotte, NC
  • Say hi to him at: 
  • Best Ever Book: The Power of One More - by Ed Mylett

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Joe Cornwell (00:14.946)
Best ever listeners, welcome to the best real estate investing advice ever show. I am your host Joe Cornwell. And today I'm with Derek Peterson. Derek runs a real estate media company. He helps operators raise funds and build marketing channels. He has also stepped into the real estate game as an operator and a fundraiser as well doing syndications. He's over 500 doors and he's doing a new build to rent development at 190 doors in the Phoenix market.

Derek, thank you so much for joining us today. I know it's been a couple of years since you've been here. How are you today?

Derek Peterson (00:48.582)
Great. Thanks for having me back, Joe. It's it's an honor to always be on this show. So thank you so much. Appreciate it.

Joe Cornwell (00:54.072)
We appreciate you coming back. I know that a lot has changed for the past couple of years. You said it's been a couple of years since you've been on the show. We'll be sure to link to your previous episodes for anyone who wants to catch up on that, but open up with what has changed the last couple of years for you in your business.

Derek Peterson (01:09.858)
A lot's changed. You know, when I was on a couple of years ago, really my focus of the conversation was more around marketing for real estate capital raisers, sponsors and operators. So, you know, for those that are listening right now, I have a marketing firm that when we first started, we were just any traditional marketing agency that did marketing for any company. It didn't matter your pizza shop, you're a plumber, whatnot.

And one of my first folks that I actually did some branding for was somebody named Chris Benson over at Reliant Real Estate, their self storage operator. You gotta think he's probably been on the show, Chris. And they, uh, that, that got me sort of into the space and understanding what real estate syndication and capital raising is.

And then sort of over the years, I started to build more and more brands as a company in this space to one point. Uh, and this, this wasn't what we were doing a few years ago. We completely shifted and pivoted to just being monomaniacally focused on that. So if you go to our website right now, dot media agency.com, you'll see just. That's all we do. That's all we focus on. So that's been a, a big shift and pivot.

I was always telling my clients in the real estate and capital raising space like, hey, you really need to focus and niche down on the avatar niche you're trying to reach. Yet I wasn't doing it. So I thought, you know what? As a marketing firm, let's just go ahead and niche down. And it's been tremendous and it's opened up so many doors for me, not only just from a market, you know, from a market perspective and that business all onto itself, but it's really allowed me to completely shift and pivot what I spend most of my day doing, which is raising capital and operating this fund, um, with a relationship that's developed since the last time I was on.

So last time I was on, uh, you know, I was just beginning to raise capital. I had a capital raising company we raised for other sponsors and operators, and we raised over the course of a couple of years, like 20 million across a variety of different asset classes. It was a great experience wearing the capital raising hat to understand, you know, what's it like vetting out and finding good sponsors and operators? What should I look for? What's the investor mindset? What do they want? Really trying to completely understand all aspects of sitting on what I'll call that side of the fence.

But I always had dreams and aspirations of sitting on the other side of the fence, right? Which was to be that sponsor and operator, but there's so much more that's involved. That's an entire team versus just a couple of dudes that are raising capital, which is what I do a lot of branding for is just people that are really stepping into the space. So going from an LP investor to the marketing firm to raising capital, I had an opportunity to meet somebody by the name of Balakrishnan. He's my partner at TenY. That's our company. TenY stands for 10 years to retire.

We can kind of get into what that means later. I'll be kind of get the point. And we, we decided, we met as just somebody that, Hey, Derek, can you build my brand? You know, cause we, we built brands for, you know, 250 companies in that space. He wanted us to do his. And when we met, it was like, love at first sight, right? We just clicked, we bonded. It was a, you know, he's very new in his journey and sort of creating his business. And he needed a marketing guy. He needed somebody that had capital raising experience.

So rather than just having the typical traditional relationship like you pay me as my marketing firm and I elevate your brand. So when we take this to a different level, so I flew out to Phoenix three times because I really wanted to make sure who I was, you know, kind of getting in bed with and potentially partnering with and really understand to the root the core who this person was.

So I went through my due diligence and it was a very extensive, thorough and in-depth process but at the end of that rainbow I realized this is where I need to be and this is a tremendous opportunity which we can kind of get into why that is because I see every different type of syndication, deal, asset class, investor avatar, hundreds of them. And this one was completely different and sort of blew my mind the way in which it was structured. So I felt this was a tremendous opportunity. So I jumped in and in the last uh the last year and a half, we've done some tremendous things at 10Y. We closed a $20 million fund this past July for that 190-unit Build to Rent community in the Phoenix MSA, and we're about $25 million into a $30 million raise right now for our second fund, which actually has three properties for another roughly 500 units in the Phoenix MSA by the end of this capital raise, which we hope to get wrapped up, you know, the end of this month.

So it's, it's been a wild journey, man. Just going from just some dude that want to open a marketing firm to hear, you know, having raised close to $50 million in the last year, right. And being on this show to have this discussion, I kind of have to pinch myself, it seems a bit surreal.

Joe Cornwell (06:08.65)
Well, yeah, a lot has changed over the last years. I do want to back up to something you mentioned where in your marketing business and the clients you're working with, you were constantly advising them to niche down into something specific. Can you tell us a little bit more about why you feel that's important?

Derek Peterson (06:24.058)
Yeah, great question.

So I always tell clients that the riches are in the niches. So there are a lot of capital raising companies out there. There are a lot of different businesses that are vying for your attention. And attention is really all that marketing is. I'm just trying to get someone's attention and have them arrive at that piece of content, that website, that email, that text messaging, and feel like, oh, hey, they get me, right? They understand who I am. So when you create something that cast a wide net, a lot of our clients that come to us, you know, they often feel that's what they want to do. Like, hey, I just want to work with those who want to invest in real estate because they want passive income. It's a snooze fest, right? That's not gonna capture anyone's attention. They're gonna create a brand that's got a bunch of stock images on it and very benign, boring text that's not gonna connect with somebody.

The reality is every single business is a solution to a problem, right? A pizza shop, it's a solution to my hunger, a plumber, I've got a leaky faucet. And we need to trust that this individual understands what my needs are and can be a solution to that problem. So when you niche down, right? And you, and you, and you relate to somebody, it, it connects with them at another level and gets them to do what every piece of marketing is intended to do. And that's to get them to take the call to action, whatever that is. That might be book a call with you to talk about your investment dreams. That might be to download that lead magnet, join a webinar, whatnot. But if you don't have attractive bait on the hook, the fish is just going to swim by it.

So you really need to make sure that it, that bait is very specific for that fish and that your lure's in the right pond. So that's why niching down's important. It's counterintuitive, right? A lot of people, they think, oh, if I niche it down too small, right? Then that pond is more like a puddle, right? It's a small little body of water. There's only a few fish swimming in it. But the reality is it's blue water, right? We always talk about this in marketing. It's blue water versus bloody water, or you go to water where everyone's fishing and it's just chum rolling around. It's a lot harder to catch a fish versus I'd rather go to a pond that has, you know, just a few fish in it, but they're my fish and they understand and they get me. So I've done this with a variety of brands and I can give countless examples of ways in which we've really forced people to niche down and they've had tremendous success from it.

Joe Cornwell (08:54.046)
It's interesting you say that. So, you know, I'm, I'm admittedly not great at social media and you know, I, a couple of years ago, I started a YouTube channel that, you know, I was never consistent with, but one of the things I did learn, uh, you know, with my research and starting a channel and trying to do some long form video was that my go-to like on let's say Facebook, you know, historically, and I'm a millennial. So Facebook is kind of our, you know, prime social media we grew up with. Uh, and you want all of your sphere, everyone who knows you to support your content, right?

Well, that's, that would at least be my default thought. And as I researched and started to start, you know, learning YouTube, it's like, you actually don't want that at all because what happens is that people want to support you so they may go subscribe to your channel, but they're not actually bought into the content because they don't necessarily care about real estate or whatever you're talking about. Right.

And it's kind of it made me think of what you were saying, where it's like, those aren't your fish in your pond, because just because they like you as a person doesn't mean they give a crap about, you know, your hour long talking head video about, you know, buying duplexes or whatever. Right. So they're not actually engaged, which tells the algorithm it's bad content, which doesn't, you know, put it out there. And you could probably sum that up a lot better than I just did. But is that analogy similar to what you're talking about when it comes to business marketing and things like that?

Derek Peterson (10:11.77)
Definitely, I think a lot of people, especially like let's use YouTube as an example. With YouTube, you're absolutely 100% correct in that it's one thing to have a number of subscribers that looks good, feels good, right? Hey, I've got 10,000 subscribers, but if your watch time and all that stuff is not where it needs to be and people aren't watching the entire video, they're not staying engaged, they're just there to support you, or there was some sort of marketing hack to get them to subscribe, you know, that doesn't serve you, right? What's more important is like, let's really just whittle it down to those subscribers that matter, right? So take 10,000 and whittle it down to 200.

The idea of being famous to a few, right? If I'm looking to raise $50 million, right? And the average investment is around a quarter million, right? I really only need a couple hundred people that I'm close to that trust me. I know them. They know me. We relate, right? They're in my niche. They're part of my avatar. They get whatever that is. They get it versus having 10,000 people that just sort of loosely, flippantly sort of follow me. That doesn't, that doesn't really serve me.

So, yeah, we see a lot of folks as a marketer. We get a lot of people like, Hey, I want to, I want to increase the number of followers I have. I want to increase this. I'm like, no, you don't.

What you want to do is you want to niche down and you want to, you want to increase the number of quality people that are following you and really the metric or the KPI that you want to look at is like, what's the, what's the engagement? Like how many people are booking appointments? Like followers don't really matter, right? I can go buy followers. Um, and none of that, none of that matters. So yeah, you, you definitely want to be more focused on, especially in this space as I've learned in being famous to a few versus just having this big presence and number on your YouTube page or Facebook, Instagram, pick your platform.

Joe Cornwell (11:59.914)
Well, I appreciate all that insight, you know, and obviously having that background is super helpful. And I'm assuming that's helped you in your business now where you're actively raising money, you started your fund and tell me a little bit about how you transition from that role into the actual operation side.

Derek Peterson (12:17.87)
Yeah, so...

It was funny. I'll kind of take it back a little bit into how I kind of transition into the role completely, which was back in, back in 2019 when I, it really wasn't that long ago. What's that? Four years ago, I decided I owned a medical distribution business and I was just kind of sick of it. I wanted to open a marketing firm and a travel agency. Yes, travel agencies still do exist because I wanted to be able to travel the world with my wife and, uh, and be able to have a business that could work from anywhere, reason why I got into this space, right?

I was an LP investor here and there and so I started the marketing firm. Like I said, I had that first client Chris Benson and as I started doing client by client by client, I ran into Tim and Greg Lyons at Cityside Capital.

And I asked them like, hey man, how do I get into the game? Like I want to do what you do. And they said, we should do Derek, because like you're building a lot of brands for capital raisers. Eventually someone's just gonna ask you to partner, bring your superpower of marketing to the table. And that's your way in, right? What you lack in knowledge and real estate you can pick up for on the ability to track investors and marketing.

So I chewed on that for a minute. I was like, wow, that's a great idea. So I went for a walk with my wife on the beach and I said, you know, we're gonna do that. And that was in 2019. So I started a capital raising company, like I said, and you know, that kind of fizzled, if I'm being honest, just because it was, it was, everyone's kind of doing a part time and I kind of wanted to go bigger. And then we made the decision to, like I said, partner, partner with Bala and that was really where that transition happened.

You know that Tristan transition happened when I made that commitment to say, hey, I'm going to go all in on this learn all the things and the nuances that means to be an operator and to sit on that side of the fence, not the capital raising fence, but which was you really useful to me when it came to raising capital, but I wanted to come in to this role and my value is obviously marketing the marketing the business marketing creating our niche creating all the branding, but then being able to attract the investor and to attract the money, right?

And that's probably been my biggest, that has been my biggest role in this is like, how was I going to go about doing that? And that's really where, what the greatest transition has been for me is taking the time that I used to spend at the marketing firm and peeling off, you know, good 70% of my day now and allocating it to this. I still need to keep that marketing firm going because those relationships that I build in the capital raising space is what's allowed me to be able to go out and raise so much capital so fast.

Joe Cornwell (15:00.714)
Yeah, so let's talk a little bit more about that. You've mentioned how you transition and what specifically for the listener, let's say, I'll give you an example. Let's say somebody out there has maybe done a couple smaller deals. They're looking to scale up into some of the larger types of properties and maybe go from JVs to syndications or something like that. What would your advice be to them if they're looking to start doing some of this marketing for themselves, help them raise more funds, get access to more potential investors?

What would your advice be to them?

Derek Peterson (15:32.998)
Great question. So I have this discussion every single day. So we work with a lot of masterminds out there. That's where we get a lot of our business. We've become sort of the lead go-to referral source for these masterminds because these masterminds want to see these new, as you said, up and coming capital raisers, sponsors, and operators succeed. And a lot of what hinges on that success outside of the day to day operations is like, do they have the ability to attract investors and attract dollars? Without that, they have nothing. Right. Um, so.

So the conversation we have with folks is, you know, when I sit down with somebody who's looking to develop their brand, it's the first thing we do because this is this goes back to what we talked about earlier, the seed by which everything else is planted or grows around in terms of their marketing is who is the person that they're trying to reach and what is the problem that they're solving. And that goes with any business is really understanding what that is. So we spend an inordinate amount of time. I spend a lot of time with each client. I spend over an hour, hour and a half with people when I have initial consult with them to understand like what is their niche in avatar? Some of them don't know, right? Some of them are that new, they're not even really sure. So I kind of walk them through. And a lot of times when you're new to the game, your niche in avatar is who you were two to three years ago.

Right? So that's that struggling tech employee, right? That is just, you know, getting paid huge commission checks and kind of getting hammered on taxes. And they realize that they want a more cashflow versus these inconsistent commission checks and real estate hikes. It's that pilot, right? That, you know, wants other passive income streams and feels that they can potentially relate to other pilots, right? It's that person that has an investment thesis that is very unique, that solves a problem that other investment theses don't really apply.

So it's really understanding what is that niche and avatar. That's the first part. Then the second part of that, because a lot of these capital raising companies, they start small, right? It's typically it's one person or it's a group of several individuals. It's really understanding their personality. Because at the end of the day, when an investor comes to invest with you, your marketing's gotta be tight, you gotta have a great website, your email's gotta be good, and all that stuff does matter.

Don't get me wrong, but your pitch deck's gotta be magnificent, but at the end of the day, none of that actually matters. What matters is do they trust you? Do they have that gut feel that you're gonna get it done? And what comes from that is ensuring that you are the most true and authentic version of yourself. So none of this imposter syndrome. We get people all the time like, hey, I wanna be like Grant Cardone. I'm like, cool.

Like, are you like Grant Cardone or are you you, right? Right, and the guy, I remember, I had this conversation a couple weeks ago and the guy's like, no, I'm actually an introvert. I was like, do you think that's gonna come across a little awkward that you're an introvert? You're gonna feel like you're faking it and your investors gonna sense that and they're gonna taste that and when they actually meet with you unless you put on that Grant Cardone sort of persona, 24 seven in every bit of your marketing, all your social media, the way you read your emails, all that stuff.

There's gonna be inconsistency and with inconsistency comes distrust. So it's super important that A, you understand your avatar and your niche and B, you're the truest authentic version of yourself. And then what we do is once I understand that, like who you are, what you're about, and I can give examples of this, we make sure that's blended into your branding. So everything that we do is completely custom. You can't have this like cookie cutter blend, just sort of boring website.

That's not very, everything needs to be taken into consideration when building that brand around who you are in your niche. Because a brand was probably best described by Alex Hermosy, I don't know if you follow him at all, but he talks about a brand being like a bouquet of flowers, in which a bouquet of flowers isn't a thing, just a bunch of things together that creates a new thing. So your email, your social media, your website, all those aspects of your branding are like flowers in your bouquet. And if one is dead, wilted over, the whole bouquet looks like garbage.

So it's very important that all that has continuity and is tied to those two things that I mentioned, which is your niche and your avatar, and then who you are as a person, because that's ultimately who they're investing in. They don't care about your building, they care about the person operating it.

Joe Cornwell (19:50.142)
Yeah, it's funny you mentioned Alex Hormozy and I do follow some of his content. Um, and I think it was actually him who said this, I believe I saw it a while back, uh, but it was something along the lines of you don't have to try to be somebody, you know, whatever, whatever it is you're trying to achieve, especially like in social media, you, who you are is what you should be projecting.

And, and the example he gave is like, who you are is this makeup of all these unrelated things, but that creates your niche. So it's like, you know, um, I think he, I think in that, in that clip, you might've used Joe Rogan as an example, but it was like UFC and you know, comedy and podcasting are like all unrelated things. You may not really think as something, but now when you think of any of those, you think of Joe Rogan because he's kind of like, you know, at the hierarchy of all of those things.

And the point he was making was like, that's just, you know, an authentic person and why he gets so much attention and has the biggest podcasts and all this other stuff. But it's like, you don't want to try to act like Joe Rogan. You want to be who you are and create your own niche because that is basically the sum of all your parts. As you mentioned, um, hopefully I didn't butcher that too much, but that was what I took away from it anyway.

Derek Peterson (20:58.798)
Yeah, no, you're spot on, man. I mean, it's, you gotta be yourself. It's a lot easier being yourself too, let's be honest, right? When you try to fake being somebody else, it's a little bit of a challenge. And honestly, most people, they can see through it. They see that it's kind of BS. So you really just wanna be yourself and understand that you're not gonna connect with everybody. You're not gonna cast this wide net. That's why niching is important. 

There are some people who are gonna think like...they don't like you, right? You may get some nasty messages. The more true and authentic you are, and you start to get a little bit of, I'll call them haters, and awesome, you've arrived, right? You're so niched down that you have some people that are kinda, you know, they wanna hate on you a little bit, because I've got clients that have got that, but they have a massive following. And when they get that first kinda like, abrasive comments in their social media or someone challenging them. They're like, man, what is this? I'm like, ah, you have arrived. Congratulations. Like this is where you want to be, you know? So it's a, but it's all about being yourself.

Joe Cornwell (22:01.546)
Well, nothing pumps the algorithm more than, you know, 5,000 people arguing in the comments. You know, that certainly doesn't hurt a video going viral either.

Derek Peterson (22:06.318)
This is true. Yeah, there's no such thing as bad publicity as they say.

Joe Cornwell (22:12.774)
Yeah, no, this has been great. Uh, you know, I, again, far from the expert on social media. So I appreciate it all. I've taken some, some tips for sure. Um, anything else you want to add on your app operational standpoint on the things you've learned before we transition?

Derek Peterson (22:30.318)
No, I think we're going to get more into sort of the superpower. So I think I'll reserve that for then. Yeah.

Joe Cornwell (22:35.838)
Yeah. Well, I appreciate that. That is our next segment. So, you know, something new we're going to be trying on the show is drilling down on our guest superpower. As I mentioned, you are first guess that I'm doing this with. So what is your unique superpower that you feel gives you an advantage over other investors?

Derek Peterson (22:56.719)
Yes, sir.

The unique superpower that I think has allowed us to have the success we've had over the last year and a half in raising capital at a time that raising capital has been difficult for most. And you know, I think that's probably been somewhat of a theme that you've heard, you know, across the airwaves. I know a lot of my clients are feeling that pain. Uh, you know, it's, it's a difficult, it's a difficult time. So like, how do you stand out? How do you, how do you still succeed in this space outside of your branding? Like what else can you do?

And you know, of all, assuming your branding is tight and all that stuff, you know, my unique superpower that I've discovered truthfully, you know, just by happenstance over the course of the last year and a half is because I have the opportunity as a marketing firm owner that works with real estate sponsors and operators, I have an opportunity to have conversations with hundreds of them.

And we have a studio here in Charlotte, North Carolina, where a lot of them fly in to shoot their video for the website. So I spend a day with these people. We really get to know them, we go out to lunch, we hang out, I get to know all the different nuances of them. So when you start to develop relationships like this with individuals, you really start to build this community behind you of people that, you know, like, hey, one day I could see doing something with this guy or maybe this gal or maybe not. Right. Some people I have conversations with, we build brands and I'm like, yeah, you know, they're, we'll see how they do, you know, the greatest brand in the world. They have, they have other aspects of, of maybe they're the way in which they do business that, that I wouldn't want to be a part of.

So we realized they start to develop this network. And when, when tasked with the opportunity to be able to raise, you know, 50 million over the last year, I was like, man, how are we gonna do this? Right? So here's the marketing guy that's sweating a little bit. Right? I should be like, oh, this guy's got it, no problem. He just whip up some social media and have his entire team make amazing content and money will just fall from the sky. Well, that wasn't the case because again, everyone's struggling with it. So I started to realize like, hey man, you've got access to all these people that can build a team.

So, and really kind of like pick your own kickball team, pick your dream team from this sea or this pool of customers that I've worked with to be able to build a team to be able to go to raise this capital. And not only build that team, but I build the brains for these teams so I can have that conversation with these individuals and then be able to jump into the driver's seat with them. Cause some of these folks were experienced capital raisers, but most of them weren't.

Right? But I saw potential in those individuals. So I guess my superpower is really taking a look at that individual and look at that person, really understanding them at the core and spending a lot of quality time with them to see if they might be a good fit as a partner. Then providing them with the tools and resources in that marketing machine to then partner with us to go raise capital and and jump in the driver's seat with them.

So jump into their marketing machine that we built and help them drive it alongside of them, to give them the guidance, to give them the experience. So they almost get another layer and level of service to which I am not charging them for this because we're benefiting mutually to go raise capital for these assets. And that's been an amazing ride that I've had this year. You'll be brought on 13 people that have just been absolute, just studs, just a stud group. And I was able to pick by the niche and avatar who I thought would be a good fit.

Like, you know, this person has, you know, he works with clinicians and this person works with attorneys and this person worked with farmers, right? So we had all these different niches and avatars where I could say, hey, these are the types of customers that we would want to be part of our 10 year fund. And it's, you know, it's been a tremendous experience. So we were able to raise, 20 million in four weeks, which we closed on that back in July. And then we've, like I said, we're 25 out of 30 million at the time of this recording here in January. Uh, and we've done that in about six weeks, which was, which is pretty fast, all from LP investors. So it's, it's all LP investors. And, uh, so that, that's an unknown sort of superpower that I've realized that the ability to build that team and raise capital.

Joe Cornwell (27:15.282)
Yeah. And I made some notes. And so, you know, it sounds like starting from the top, raising money, building relationships via networking through your businesses that you've been a part of, and then ultimately building teams through all of that experience, networking and relationships. And I guess my question to you would be for the listener who may be listening to this and saying, Oh, well, yeah, of course, this guy's got a marketing background. He's getting access to all of these high profile people.

That's something I could never do. That's something I can never have. What would your advice be to them for their situation, their unique situation where they could take the steps to help themselves network, build relationships, and ultimately build teams at the point where they're trying to either raise money or scale a business or whatever their situation may be.

Derek Peterson (28:07.118)
Anyone can do this.

And you don't have to have a marketing firm to do it. That was just the vehicle by which I was able to build those relationships. But I'll give an example of someone who doesn't have this, that I actually got this idea from them because they interviewed me. So I go, a lot of folks that are listening are real estate operators, sponsors, capital raisers, and we all have kind of the same goal. And a lot of us belong to these masterminds, and these masterminds have these big meetings.

So I was at a meeting, it was Hunter Thompson's meeting, and I got asked by Rob Beardsley at Lone Star Capital, actually Craig McGruther, one of his partners, asked me to come sit down with them because they wanted to talk to me about something. Now me, marketing dude, I was like, oh, they just want to talk about marketing. I was raising capital at the time. And that wasn't why he was there. So Rob and Craig sat at this meeting for five days in the corner, and they just, they reached out to all these people that were inside of that mastermind, and they set up meetings with them, and they interviewed them. They got to know these people to see if they might be a good fit to raise capital and to partner with them.

Derek Peterson (29:19.138)
And I realized that as you started to sit down in the meeting that that's what this was about. And at the time it just, you know, didn't make sense for me. I was already kind of doing my own thing, but that's where a light bulb went off. And I was like, Oh, I see what's going on here. What a good idea. Right. Um, you know, they carve out a certain percent of their GP for co-GPs, uh, and fund managers, and that was really what planted the seed in my mind. Like this, this is actually a good idea. This is a good strategy, but you need access. Right. So I had that access, but for those who are listening and don't have that access, being part of these master.

Minds gives you access to this just community of people and these capital raiders are salivating to raise capital to look for good sponsors and operators. Join one of them, right? Join one of those masterminds, go to the meetings, go to the best ever conference, right? You can be at those events and have an opportunity to just get face to face, you know, go out, have dinner, have a cocktail, a cigar, whatever you're into, go out there and just break bread with these people and get to know them at the core. That's the key, right? So it's one thing to talk business.

It's all about that. But before I get to know somebody and decide to do anything with business, we're gonna go do something. We're gonna go have some fun together. We're gonna go go-kart racing, whatever. We're gonna go do something to really get to know the person because ultimately, that's who you're gonna be hanging around with and spending a lot of time with. So for those who are listening as well, I encourage you through your vetting process to really get to know these individuals because partnerships, at the surface level when you first meet people, they all seem great.

Oh, we're all gonna make a ton of money, we're gonna do great and do great things together, but you really gotta know who you're potentially working with, especially if it's a long-term relationship. Like ours is a 10-year fund. So when we picked our kickball team, we, I was like, we gotta make sure these people are a good fit. We turned some people away after we got to know them. So be cautious of that as well as in that process. Not everyone's a good fit just because they have the ability to raise money for you.

Joe Cornwell (31:11.638)
Yeah. And I'll add to that as let's say for a new investor, because all of the stuff you said is fantastic. And this people that have some experience, have some track record, have raised some money are going to do well by following everything you just said. But for the people who may be just getting started, maybe they're just trying to do their first deal, or maybe they're just trying to do their first deal where they're raising money or partnering. One thing that helped me a ton is going to even just the local groups that are free, like totally free networking, whether, you know, sometimes RIAs are free. They have like an intro meeting.

Obviously RIA is relatively cost effective if you did want to join it. There's a lot of other free meetup groups here in Cincinnati. We have like 10 a month that, you know, are started by various investors. And so, you know, if you're newer to this and this sounds all over your head, or maybe, you know, spending $500 or $1,000 on a conference is outside of your budget at this point. Like I said, there is a huge benefit to just networking with other investors, learning from people, even in your local area.

And as an agent and as an investor, building relationships with these people for free over the years has helped all of my businesses, helped me grow as an investor. So I would just add that for anyone who maybe feels like this is a little bit over their head if they're not quite there on the things you mentioned.

Derek Peterson (32:26.902)
Agreed. Yeah, I mean, any opportunity to network, any opportunity to work with individuals is going to grow your business. You know, your net worth is your network. I'm sure we've all heard that saying and like, embrace it. It's really true. I, the power of people and working with them, especially in this space is massive.

Joe Cornwell (32:46.134)
Yeah, and sit but sitting in your house and you know watching social media is not going to get you where you want to go Unfortunately, so you can you can consume all the content and know everything you want to know But yeah, you got to get out there and shake hands and actually, you know Meet with the people doing the things you want to do if you want to grow Awesome. Well, I appreciate all that. I appreciate you Diving into your superpower there. Are you ready to head over to the best ever lightning round?

Derek Peterson (33:11.122)
Let's do it.

Joe Cornwell (33:12.746)
What is your best ever book recommendation?

Derek Peterson (33:16.942)
Who Not How? So do I expand upon this in the lightning round or just give you the answer?

Joe Cornwell (33:22.614)
Yeah, yeah, give me a nugget.

Derek Peterson (33:25.102)
A nugget, I mean, really just look at the title, right? So it's really when you're looking to build your business, you know, when you look at how to do it, look at who you can bring in to do it. Cause as entrepreneurs, we have the tendency to try to take on too much and do too many things ourselves. And you are the bottleneck that's slowing down your business. So find the people that have the superpowers like we just discussed, find those people, bring them in and make your team. And then you'll just, you'll see a massive difference in your businesses.

Joe Cornwell (33:50.634)
Yeah, could not agree more. That was definitely an issue in my business as I grew. Best, best ever way you like to give back.

Derek Peterson (33:59.182)
Man, you know, so for us, you know, my wife and I love to travel.

Um, and we've traveled the world. We've been over to 40 countries. We're actually looking to sell our house and everything, cars, all of it for yourselves from our material possessions. Once we're, uh, you know, this, this August and make this more of a full-time experience where we live on the road. But when we travel wherever we are in any part of the, any part of the world, we try to find a family or somebody that isn't of need in that respective area. And it can be anything. It could be they just need a meal. They need they need clothes, they need time with somebody to listen to whatever the case may be, and just spend time with that individual, give them the resources they need.

But, and, you know, naturally we do this in, with those in the U.S. as well, but, but we have very much of an international mindset that, you know, we love all people. It doesn't matter what color, race, gender, no matter where part of the world you're in. Um, you know, that, that's where we, allows us to connect at another level when we're traveling and also give back. Um, so that's, uh, that's the way in which we love to give back the most right now.

Joe Cornwell (35:13.246)
And give me a mistake you made in one of your investment deals and the lesson learned from it.

Derek Peterson (35:19.179)
Oh man, I was hating this question. All right, so there's a little backstory on this. I'll try to be brief. So listen, we've all made bad investments. I'll just, I don't want you to think less of me as I tell you this story. So we, early in my investing career, this is like a decade or so ago, I had a buddy who had a had a other dad owned a car dealership. You use car dealership and they would sell, they'd sell cars that are very by your high interest rate because they took people that like zero credit, really awful credit.

So I had this like, it was like 27% interest or something on the car note. This is something ridiculous. But the, and they put LoJack in these cars. So these cars were the asset, right? And they had a very high yield on it because they, I mean, they were getting 27% on the dollar. So, but because of the way in which it was a used car dealer they couldn't have what's called a floor plan, which basically is how they get their inventory for all the cars.

So I became that floor plan in investors dollars, I bought all the cars, they buy them from auction, they add a little bit of a markup to it and then I buy them at a discount and then I have this, you know, this, this APR, right? This this annual percentage is getting applied to it. And the idea in my head was like, oh cool I've got this thing that's earning this much money every year if something goes wrong with a car if they don't pay for that car They just stop the car they go pick it up. They bring it back to the lot and they resell it It felt very safe, right? I had a relationship with the owner. I had a relationship with the owner's son. 

And to make a long story short, I took my eyes off it. I didn't really do my due diligence on the individual, their track record and ability to collect payments because they were collecting the payments.

And I was getting a check in the mailbox every month until I stopped and I didn't. And I was like, Hey guys, where's, where's the check? And they're like, ah, we got to talk to you. So I went in and, um, I invested a quarter million bucks and I went in and, uh, they're like, yeah, it's all gone. I was like, what do you mean it's all gone? And they, they cars were like in lakes somewhere in Mexico, like just it came off the rails because they weren't managing the asset very well, or at all. There was about 10 cars left in the portfolio.

So my wife was like, give me the titles, give me all their information. And we went and we started collecting rents, or not rents, payments on these cars for the better part of the next few years. We repoed some cars, that was fun. And really learned a lot about that industry. So we were able to recoup some of it, but man, that was a really, really bad investment. So I do not recommend that one for the listeners.

Joe Cornwell (37:57.35)
Oh yeah, that was a very unique story. First one I've heard of in holding used card notes. So I appreciate you sharing that. Derek, I've learned a lot today. I really appreciate all your insight on your operations, on your social media and your marketing background. Where can our audience learn more about your business and connect with you?

Derek Peterson (38:16.462)
Yeah, so if it's related to marketing, you can find me at Adapt Media Agency, or you can email me at Derek and adapt media agency. And in terms of our fun and what we're doing in real estate, you can go to 10y the number 10, the letter y like yogurt dot life, or just hit me up at Derek, it's D e r e k at 10 y dot life. So that's, that's where you can find me in either of those avenues.

Joe Cornwell (38:42.834)
Awesome. And we will be sure to link to that in the show notes as well. Listeners, if you got value from today's show, please leave us a five star review on the app, your choice, make sure you're following us on social media. And thank you again, Derek, for your time. Hope you all have a best ever day.

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