Syndication Attorneys Podcast
Now from a people perspective, how do you didn’t get the fundraising done for a Regulation D Rule 506b or 506c offer? I mean, you can do the work. But what about other people? How does that fit in? What about finders all those questions you may have? Well, this video that I recorded from the past, we’ll we’ll go through all of that. So this video was recorded about two years ago. But the information is still completely valid. The information was recorded for a training program, I used to have force indicators, and I hope you find it useful.
We are back, we’re talking about your flight crew. And specifically, I wanted to start off right away with a discussion of fundraising. Now fundraising seems like it should fall into another trap. It actually belongs in flight crew. Because the number one challenge I think most syndicators face is finding money or finding investors. So most of the time, as a lawyer, I have clients coming to me saying, Can I raise money this way or that way? So I thought it would be best that we first talk about how to use your flight crew in a way that where you are raising funds, but you’re doing it complying with the law. So let’s talk about let’s talk about that. So we’ve got investors, and they all want to give you money, you found them all. And then this is you. You’re putting them into this great property.
You’re putting them into this great property, right? So and then here, where it comes down to here is, this is probably going to be okay, you are the sponsor of this LLC, you are getting paid not on a commission, like $1 per dollar of money that you’re raised. You’re getting paid basically for your work as the sponsor. So I’m not even going to draw well, let’s draw back so. So here this money is for your labor. And specifically, we’ll put sponsor labor. That’s supposed to be an sponsored labor. So here you’re getting paid money and sponsored labor. This is fine. There is no conflict here. As far as it relates to what you can do with fundraising. A lot of some some syndicators, what they do is they’re these investors out there. And they go instead to a broker dealer. This is somebody who has a stock you know, stock brokers license series seven, series, six, I believe that and they ask them to find investors get money to bring to your property, and then there’ll be paid a commission. This is also okay. In this situation, it’s the broker dealers job to make sure that the opportunity that they’re being paid is suitable for these investors. That’s what the is the main concern of this part. And it’s really that falls on the broker dealers point not on the individual people as well. I will just as an aside, finding a broker dealer that’s with a large a large outfit so say your Raymond James or your Goldman Sachs or whatnot, it’s difficult in order to get them to be able to to bring you investor money and pay them a commission. Now, why is that? Because the broker dealer itself is on the hook on whether this deal is actually considered suitable. If this was considered a if not saying yours was but if the broker dealer brought a scam to their investors, the broker dealer is in big, big, big trouble. So they’re the ones who are going to get sued, and they’re going to have to explain why they thought this deal was suitable. So the bigger companies mostly prohibit their, their broker dealers from the individual people themselves from finding investors, unless they’ve had a thorough vetting process on their own, that process takes about six months, most of the time, sometimes nine months. And it just takes too long. And, and it can be very expensive for any particular deal. Now, independent broker dealers absolutely can bring these deals to you. And so there are broker dealers out there, that will, that will work with you. But if you’re thinking while you’re just gonna go to your your buddy, it was with Raymond James, they’re not going to be able to help you on on this and get paid a commission. It’s just that that’s a good aside. So this is the plan that works, though, where you talk to a broker dealer that is independent. So then there’s the situation of okay, well, you have three people in your office, and you tell them all, look, find me some but some I need some investors, do some cold calling for me. And then and set up these meetings. And I’m just paying you your regular salary.
And so Paul, the call this person employee, no problem there. Either. You can play employees in order to find new people. But here is where things get different. Say you, you say okay, well, I’m gonna pay you a salary. And I am gonna give you 10, hoops 10%, cash bonus. Ups, cash bonus, for each. For each dollar that you bring. This you cannot do unless this you just blink into that you can do now what most people also try and do. And this is where people really really get in trouble is they’ve got a friend, oops, they’ve got a friend.
And they’ve, they’ve told their friend all about this investment in their friend says yeah, this is a great deal. Your friend really likes it, they want to go in themselves. And they start thinking and they they say to themselves, you know, this is not only a good investment for me, but this is a good investment for my, my buddies over here, too. Now, what if I bring those people all to you, and then you give me a small commission? This happens a lot. And you absolutely 100% cannot pay them a commission. They are not licensed broker-dealers, they are not participants. They are not members of your sponsor organization. And they’re receiving money for the activity of bringing you deals, which is not an allowable expense. And then you say, Well, no, my friend, actually he’s my friend, but he’s also a real estate agent. Can’t I do that? You know, this really is just a real estate thing. I can pay him a real estate commission or something like that. The answer again is no. Most of the time. There is one exception, where it is okay. But please don’t think that this applies will apply to your situation because more often than not, it won’t. So if it if it’s something that you think we’ll apply, talk to somebody who knows talk to an attorney or talk to bring it up in a coaching call and we’ll go through it and we’ll see if it actually would apply in your situation. So the exception would be this property is in the same state. So for example, right now I am in California. Every single investor is coming in to invest in California. And I am not using one of the exceptions of Reg D, Reg A, Reg CF, or, or any other kind of exception. Instead, I’m using the blue skies laws of the state of California. And the state of California specifically says that if you’re raising money in one of these kinds of transactions, where every single thing is in California, and you are not relying on the, the the laws of Reg D or reggae or any of the federal laws, then you can pay a commission to, to the real estate agent, there are companies here in California that do this, and they advertise to real estate agents that they can do this. And they can, because they also are very, very, very careful that everything is within California. There probably are similar laws in many other states. And so if that’s the case, you would be able to do that. But once anything lies outside of one of those states, one investor, just one not even the one that you’re paying money for. If they’re outside $1 comes from them, absolutely not you goes under the SEC rules. And you cannot pay like that. So most of the time it is you cannot do this. And if you think you can bring it up in a coaching call, and we’ll go through it. So I hope that helps. The basic is that you can pay your regular salary to and people you just cannot tie what would look like a commission or a bonus to finding investors for your investment. That’s where people get in trouble. And so I wanted to put this under the under our main topic of finding investors underneath the your flight crew, because these are the people who are going to the flight crews who help you get the deal done. And so compensating them is oftentimes a thought and this is how that conversation typically is born. So I’m sure that was useful for you about looking at it from the viewpoint of who does what in terms of getting the fundraising done, exactly how that is structured, what’s allowed what’s not allowed. If we can help you with your Regulation D Rule 506b, or Rule 506c offer please don’t hesitate to give us a call. This is Tilden Moschetti of the Moschetti Syndication Law Group.
I’ve said it before. And I’ll say it again, there are two jobs for any syndicator or fund manager. Number one is finding investors and number two is finding assets to invest in. This is a blast from the past from when I used to coach syndicators and fund managers on how to start their own real estate syndication funds. So the video is about two years old, or maybe a little bit more by the time you’re watching this video. But it goes into a deep dive into what that process looks like in order to find those best part markets across the nation.
All right, so wanted to go more into marketing, or to market analysis and to demographics. Today, and so what I did was I’m gonna switch to it. Good. Right. So what we’re gonna do today is we’re gonna look go through some, you know, general market analysis that I did, as we talked about last time, my top eight markets are in no particular order, Seattle, Denver, Phoenix, Houston, Atlanta, Columbus, Ohio, Charlotte, and Raleigh. So those were the main markets that I was picked out of, that we talked about last week by looking at who’s growing the most, and who has the who has the right size of population, so that we’re choosing things that are actually growing, and that would be reasonable for investing in rather than you wouldn’t want to grow to be saying, well, the 20 person town is growing it at 50%, because you know, 10 people moved it, and that just wouldn’t be any good. So these are people that are generally I’m looking at growth rates, you know, above 1%, I’d love it 2% or 2% Plus, and we’re looking at it on a county by county basis. And that’s important, and we’ll see why I pulled that up. So I wanted first to look at let’s go through the kinds of reports that I pulled up. This is a this is a demographic Pro and income profile for Phoenix area. I actually grew up in Scottsdale, so I know the area quite well. And the Phoenix metropolitan service area is actually very, very large. Let’s actually pull it up so I can show you how large it is. Where do you go? Are you showing you’re showing, okay, we don’t want to show it on workplace, we want to show it here. So this is so let’s go back to the Find the area. I just want to show you how big the metropolitan area is to make a point here. When you’re doing demographics you’re looking at or market analysis of anything, you’re always looking at a sample size, and sometimes that sample is ginormous. As is the case here. There is a huge difference between this part. Oops, between this part, can you see my mouse? Now you can’t see my mouse. But you can see down here. So from between this part down here, and the middle of the city right here. I mean, they’re they’re two very, very different things. So that has to be taken into account primarily when you start looking at the data. Now when I was sorting through what I was looking for was these large blocks of of counting information, I think this might actually be city. See, how do I go back to that? I don’t know how I go back to that. So is the so it has to be taken into account because these areas are grow gonna grow. Probably some of them fast, like, like over here. But sometimes very, very slow. Like, this isn’t really in the area. But this place over here is growing, you know, at at a much slower rate than the rest of the country. And we’re looking kind of at averages and we’re looking at bigger areas. This is showing us by zip code, these color blocks so there are some parts that are growing much faster than others and some parts that are bigger. So that said this is the the demographic information that we pulled out of for Phoenix. So here’s how I kind of look at things first I want to say I started the top obviously I I always start with the demographic and income profile, because I care. You know, if we think about what the drivers are, the driver that affects everything is population, right? So population affects your apartments, your office, your, your industrial and your retail. So it’s only employment that starts affecting your, your office and your industrial and your retail, and then your spendable income affects primarily retail. So in population, we’ve got, you know, a very large population base, because this is a very big area that it’s pulling from, but we still have a decent sized growth. Now, the reason this number is smaller than that 2% that we saw last week, is because again, that surface area is much, much bigger. So I was zooming in on the counties like Maricopa County, that was at 2.2 point something percent, which is the main air County for Phoenix and Scottsdale, and Mesa and Glendale, etc. But it doesn’t include the Indian reservations that are there. So So 1.58% was still bigger than the national average national average is expected to be point seven 1%. I’ve got a slightly young demographic, which is something I would look for an actual I’m kind of surprised that it does skew younger than the national average. And then it’s but it is approaching the it is approaching the Yeah, the national average. And then we’ve got I’m sorry, that’s not the national average, that is the here we have population by age. Okay, we’ll get to that part. So we’ve got a, we’ve got a growing area, growing faster than the rest of the state growing faster than the nation, we’ve got households that are growing. So the difference between population and household really is, you know, is per housing unit. Families as per actual family unit, because you could have people sharing, you know, roommates count as a household, but they don’t count as a family. And then ownership of homes is increasing. And above the national average, and then the median household income I’ve always cared about is increasing as well. I’m going to talk about households by income in a minute, because I’ve got a better comparison that that shows it then. Then what this does, so by population by age, what we’re really looking at is okay, well how does this break down. So we can see, you know, we’re in our double digits, really in this in this swath between 25 and 65, which is pretty normal. And it trends throughout the time. So this is from the original census, this is the estimated number for the 2020 census. And then this is the predicted number as well for 2026. And so we still see that that swath right in there, which is normal. We have a race and ethnicity. Generally, that’s not a it’s just not a really a factor for what we’re doing. And then, now here, we kind of were just seeing just general trends. So population is growing faster than everybody. Households are growing faster than everybody. Families are growing faster than then. Then everybody. Same across the board. The only difference is the household income is actually growing more in the state than it is growing in the area, which is interesting. So I said, we will get back to you, how do I go. So one of the cities that we talked about is Columbus, Ohio. And here I want to talk about householding. Because here I would be a little bit concerned. And I would start doing a little bit more investigating. And then I’m going to show you how I look at it when it compares to Raleigh, which has actually a similar type thing. So we’ve got our median household income. Okay, we’ve got our median household income at 2%. But the nation is is expected to grow. I’m sorry, in 2021, where we we have a median trend in of I’m sorry, I’ve missed right. All right, we got our area we’ve got 2.04 versus 2.41%. So we’ve got half a percent which is pretty significant on a growth rate of the nation that’s significantly more than the area that we’re surveying. Now, what I do next is I come down and I want to see what what income brackets are really seeing that most amount of change. So we’re seeing, we’re seeing a decline in these bottom tiered income, incomes all the way down to all the way down to here.
And so, so we’re seeing that decline that there is of the population, you know, 7.9%, in 2021, we’re below 15,000, well, that drops to 6.7%. And so I’m seeing an overall decline until we get to, it starts increasing, once we get to that 75,000. Up. So that tells me that, okay, we are trending up in these upper income categories, which is what I would want to see. But we’re not seeing a huge shift. When we look at something like Raleigh, and this isn’t a, this is Raleigh and Durham combined, which is a. So it’s, it’s still a good sized area. But it’s it’s a much broader demographic. And again, it’s kind of big. So I’m seeing 2.1% versus 2.4%. So I’d be a little concerned. But what gives me comfort here is I’ve got, I’ve got pretty big swings in these upper income brackets here, my people in the one 150, and up, you know, is 9.3 and 10.1, going up to 1111. So that’s telling me, okay, all of my swings are really taking place in this category here. Really, everybody, it’s not until we get above 75,000, that we start seeing a swing, and then we get a pretty significant swing. So that gives me hope that the upper demographic is actually swinging up. And that’s kind of reflected in what we’re seeing this, this shift in the median household income from what is currently in 2021 through 2026. So let’s stick in see, Phoenix might be useful, Houston’s actually a good example too. So again, it this is just to give you kind of an idea and a flavor of the area. The other thing that I find very helpful, and I’d be happy to send these to you as well, we’re gonna send you I’m gonna send you all eight of these packages. So I’m going to send you for all of those cities that I’ve defined, we’re going to put in the for download, in the Knowledge Library, we’ll put all eight of both the tapestry and the demographic and income profile. So there’ll be there for you, you can look at those. But here is your invitation, please just let me know where you want. What you want me to run for you if you’ve got a particular market, we’re going to we can do a deep dive into that, which is actually one of the things we’re going to talk about next week, what I’d like to have happen is for people to tell me where they want to run, you know, whether that’s, you know, where do you think your dominant area is going to be? We’ll run those demographics, and then we’ll start looking at what that is. And then we’ll craft what the messaging would be about the area to investors. So I think that would be a useful and interesting exercise. Now, tapestries are pretty interesting. So a tapestry is a technology that came up that’s derived by ESRI. So it is just it’s a tapestry is another word for a psychographic profile, which basically takes all of the information that exists both in demographics and spending habits and makes predictions about who these people are and what kind of categorized category you could put them into. To do hoping we can know getting it very clearly
see me, so here’s just one click over to Chrome so you can see it. So here’s the the urban chic one we’ve got, you know, this is there, the average the number of households that are predicted to be in that average household size 4.3 This is a very good way to start to get a handle on not only your area at large, but also in the area that about what’s important and about what spending habits are gonna look back. So I’ve used this before to make a case for certain retail Uh, positions to say, you know, these are the these are people who try to who are primarily eating organic foods drinking important wine, they appreciate a good cup of coffee. So if I’ve got a retail center that’s got a great coffee shop, it’s this supports that, okay, that’s going to be a good tenant that tenant should do well. It also gives me kind of an idea of what their their overall spending habits are. And ultimately, these are where those main demographics are located throughout the country. It is they’re interesting in, in and of themselves in a smaller air, I mean, in a, you know, abroad sets, but let’s do a no. So let’s do my office for fun.
That’s a very strange way to look at my office. Yes, that is where my offices, okay. This just looks funny here because of how they laid it. So, oh, that’s showing all of cannabis. That’s interesting. Oops. Why? Stop, stop. 23901. Hello, that’s us. There we go, I looks better. That looks funny having it up there. Okay. So this is my office building, right there I sit. Right. I can’t move it. I see I there. So what we can do is we can build out several rings and get skit very specific kind of information about our about our business itself. So we can do that either by just creating rings of mileage, or by drive time, or by walk time, now we are a driving area. So but for what I want to talk about, I actually just want to just look at a two, a two mile radius of around my office. Okay, so this is, this is the radius around where I work. And let’s get a dominant tapestry profile
and this one takes a little bit longer to run, but you’ll start seeing in detail, a little bit more trends, when you look at it in a huge map. Like
Like here, it’s so hard to pick out, you know, it’s like, well, what, you know, the building I’m looking at is there and that doesn’t really tell me very much. But when we start looking in more detail like here now we started seeing Okay, now this is what we’re talking about. All of these people belong to affluent estates and, and or the upscale avenues. Everybody is within this. This, I think that’s true is that right?
Now, so, within within these color codes, so affluent Estates is this, this one, designated by the number one, urban chic is designated by the number two. And so we get into more detail about what they specifically are. So if my building is in a one a, that means there are top tier. So now I’m starting to get more and more information about who these people are, they skew slightly older, the average age is 38. For the US here, it’s 47. It also has, you know, the average incomes and the median net worths as compared to the rest of the country, but then I do like how it talks about so I can kind of get to know who these people are. They buy luxury cars. They they contribute to the arts cultural organizations. I wouldn’t go that far than that, but Okay, sure. They use service for a property garden maintenance. Yeah, so everybody has a gardener here. That’s true. Everybody has a housekeeper. That’s true. To kind of gives me an an interesting perspective on what, what’s going on. Now, this is for the, the demographic profile, or the psychographic profile. The median house value here is not $890,000. But it just gives you kind of an idea about where they fall in what they who they tend to be. And what that does is that gives you better, better talking points when you’re talking to your investor about who those people are, that are in your surrounding area. So it may matter a lot. If those if the people in your say your build buying an office building, and all the people around that office building tend to be professionals. And you’ve got a pretty good case that, you know, this is probably going to be most attractive to your lawyers and insurance agents and things like that, or if it’s medical office, and obviously doctors, it’s going to be the higher end medical services. Whereas other areas may have less of a demand for certain things and more of a demand for other things, you’re not going to find and there’s, I think there’s one apartment building. Yeah, there’s only one apartment building that I can think of in Calabasas, there probably are more, but I can only think of one. So I wouldn’t go into there saying it’s gonna be a great market for apartment buildings. While it could be, you’re gonna probably have some problems. And in order to do that, whereas if you’re looking to do, you know, either high end homes, or you’re looking to do in a professional office, or you’re looking to do high end retail, it’s a great place for it. If you’re looking to put in a food for less not a good area, there is a food for less about two miles away, but it’s not in the city. So that just gives you kind of a background in terms of how I look at demographics as it relates or psychographics, as it relates to what we’re talking about. So your assignment is to, is to message me just, you know, I would like either you know, this city, or I’d like a, you know, a five mile ring around this address or in this whole county or something, send me a message of what you want demographics for, we’ll look at him, and we’ll go through it. And we’ll say, Well, this is interesting. These are the things that are really good, and that I would talk about. And these are the things that aren’t so good. Like, if I’m having a negative growth rate, I wouldn’t, it certainly wouldn’t be the big thing that I’m touting. But I probably would address the fact that it exists because you want to get that out there as well.
Good example is I was doing a syndication where one of the people asked about what the what the education system was, like, you know, in terms of schools, does it have good schools, and what the population growth was like, one of the people I was working with on that deal, went and told the went and told the that investor that oh, the schools are top of the country. And the growth rate is phenomenal. Completely untrue. He was just being a salesperson. And, but absolutely not true. That person, oddly enough, didn’t chose not to invest. I don’t know whether they knew that, that it was not a truthful statement. There was a statement that I just overheard. And it was completely completely off the mark. And I don’t know how many other people they told that to, because I don’t want to have happen is for those negative things that do exist in every property and every situation. I don’t want those to, you know, I don’t want them to be lied about because then at some point, somebody’s going to find out, and then I’m going to get called on it. And I’ve just lost all my credibility. So it’s good to know, all of the sore points and all of the good points. And then you just look more professional to when you disclose the points that aren’t so good. And you just say, you know, look, the growth rate in this general area isn’t so good. It’s not terrible. But here’s here’s why that actually doesn’t matter to us. Because what we’re doing is we’re doing XYZ, and you know, you put a spin on it about why it’s not really a negative and overcome that. What would be an objection about that? before it’s even brought up. If the fact that you brought it up just makes you look more More and more production. Alright, let’s say I now want to go through my own mode yet. Okay? Let me open up just bear with me one second. Whoa, hi. Figure out how I bring this up. So what we’ve done here, this is a find properties spreadsheet. Now it looks similar to the the spreadsheet that I’ve given you before on finding investors. But it kind of lays out the very, very basics. The point isn’t really to use this spreadsheet that this is the only way to do it. The point for this spreadsheet is, here’s an easy way to do it, just start doing it and start logging. So I’ve broken down the finding properties into three different things that you should be doing. The first is database. Second is agents. And the third is, is CIA. CIA stands for commercial information exchange, which is your loop net, your Craxi your co star, your catalyst, your MLS, all those things are your CIA’s. So database we’ve got here, I want you to go through and just start building of the properties that are in your database that you think are likely that match your founder investment theory, just start logging those in, put in who the invent who the owner is, and then decide, you know, what’s the best way to get a hold of the owner, meet with the owner, see if they’ll take an offer. This is the same thing a lot of you do when you’re talking for, you know, getting a listing. But here you’re talking for yourself. And so at the very least, it’s another way to have a conversation with them. But this is a way where your brokerage business can feed directly into your business as a as a syndicator. And lastly, you know, what are those notes I see the best is probably a little tiny. Let me zoom it in. So you know, it’s got these these fields and it’s got a notes field, it is I would highly recommend it just do this and get it done. Just what are those key properties? Because most of you probably it’s you want a property. And so that’s why you haven’t really gotten started. And, and so if that’s the case, here’s a way you can go through your database, see what’s in existence and start just putting properties down. The second way is, is real estate agents. So I’ve advocated before that the great way to find properties is start talking to agents. It’s probably worth incentivizing them without them maybe being able to take a brokerage fee and double n the deal. If that’s valid in your state, which probably is I think almost all states let you double n and so this case, they could double that and make double the commission. And you’ll know and but you’ll then have a good property to syndicate or split it with them or come up with something in order to do so this is just a basic list that you can build out just like our other list of people to contact so to build out a name a list of who are those people? What is the product type they typically work in? Make sure these are within your, your founder investment theory, you don’t want to be talking to a to an office guy when all you’re really interested in is his land, right? It just that wouldn’t make any sense. You know what geographic area or do they specialize in, and then just start meeting with them and getting a hold of them and talking about what’s going on, buy him a cup of coffee and see what it is. Because at the end of the day, they may not even be have your product, but they may be able to, they may know some investors, that will go into your deal as well. The last is your commercial information exchanges. So what I’m recommending that you do here is start building out your searches. So, for example, I’ve got searches on prexy, and LoopNet, and costar for exactly what I’m looking for. And it emails me, you know, whenever something new comes on the market, now, some of the markets are a little hot, and so there’s not a lot coming on the market. And they’re getting sold before it hits the market. But at least I’m getting notified as soon as it hits the market. These probably aren’t where your deals are coming from. But it may still they may. And so it’s worth watching in knowing and that you’re also just going to know your market a little bit better. So you do this anyway, for your when you’re grepping buyers, you build out, you know a search in the MLS for them or you build out a search for, for them on retail properties, if that’s what they want to buy. You build it out for them. And and it’s kind of a nice thing, they get these emails, well, you just do it for yourself, because you are you’re repping yourself. So this is the binding properties. Spreadsheet, let me show you. And so I will be sending this out as well. Now it would make, I think it would definitely be a swell idea to start using this or some other way. So the reason I’m giving this is because I think they’re kind of useful forms. And I like using Excel for them. But also because to encourage you start thinking about properties in a more structured way, once things are written down, you’re much more likely to take proud and make progress than if it’s not. The other is.
Well look about it’s switched on like to pretty fancy is this lapse system
Alright, so once I have and I show you this, because I think a lot of people aren’t, don’t have any active deals right now. But this is how I keep track of it. And I want to take down the the confusion about how to do it. Now rather than have there being some fear about well, once I get it in, then I suddenly have to do all this work. So one thing. So this is the latch investors, this is the total amount being raised, the price per membership unit, estimated closed date. And then we just are starting to list out names. Now these are names from your database, this is names from your sphere of influence. This can absolutely come from the other spreadsheet that we gave back in I think it was August 4. I was when we gave that sheet. So if you want to look at the August 4, rapid implementation call, that’s where that is, then it has you know that it has the necessary steps. Now this assumes a 506 C, which most of you are going to be doing. So did they receive a brochure? You know, simple question, that brochure or pitch deck did they receive? Did they receive a PPM yet from you? When did you pitch them formally? Did they give you a soft commit? And so for my definition, a soft commit is somebody who says yeah, that sounds like something I’d put 50 $75,000 into, or $50,000 into something like that. After you’ve gotten the soft commit, that it’s at that point, then we send it to accreditation. Accreditation costs money so that’s why in less I get a soft commit I’m probably not going to send it for accreditation, so the cost of accreditation, few years early IQ which we have a link for, is, I believe it’s $55 per, per accreditation, and so you know, you can either pass that on to investors, which is fine. But if they’re not really willing to give you a soft commit, they’re not going to spend $55 anyway. And you’re certainly not going to spend $55. For somebody who who’s just kind of on the fence, it’s a waste of money.
Once you hear back from them and find out, if they’re accredited, then you move on to what their firm commitment is, the now I’ve decided I’m going to do $100,000, great sign the subscription agreement, then you get the funds in there, this was just for testing.
And then what we’re doing here, why this is swell, is because you’re always trying to keep track of where you’re at on any given point on there. So I haven’t printed this up yet for you, but you’ll get the point is, you know, how many of my prospects in this list? Haven’t I contacted yet? How many are alive? How many are? How many are just unconverted? You know, like, how many are there that are still alive? And I’ve pitched but I haven’t converted to them giving me any kind of number. They just said, Let me think about it. Or how many Pete? How many of those gave me a soft min? So yeah, I’d probably do 200,000 How many of them have finished the accreditation process? And how many signed the subscription agreements have you got? Because at the end of the day, what you’re really looking for is these dollar. So you know, really dollars that I still need to get in my bank account is $900,000. I still need $900,000. Now I’ve received $100,000 from from John Adams, he gave me 100,000. But I still need the amount remaining. If I count, if I start counting my people gave me firm commits. You know, what is that looking like? So let’s say Thomas Jefferson gave me a firm commit of $50,000. Okay, so if my firm commits come in, then I really only need 850,000. And then if I keep track of well, but George Washington told me he was gonna give me that he was probably in for 250,000 Well, okay, if I convert him, I’ve got $600,000 Just trying to give eyeballs on where you are at any given point. Because, I mean, this is the number that really matters, the number of dollars that are in the bank. At least let you know, okay, I’ve got a pretty big disconnect here. I need to bridge that gap by converting this, this, this $400,000 In order to to make it happen. And I gotta fix this calculation, because it’s adding up people who already committed so before I send it out, I’ll fix that up. Oh, no, that’s correct. So the $400,000 so this is soft, committed dollars, but it’s actually soft committed dollars. Less firm, less received. So this is counting it that way. So my mistake because the the calculation is right, it just didn’t have very title. I hope you found that video helpful. My name is Tilden Moschetti. I am a syndication attorney with the Moschetti Syndication Law Group. If we can help you put together a real estate syndication or fun or find capital for your business or whatever it is that you’re looking to use Regulation D for.
Many clients have questions about how to structure their syndication or fun. So I thought we’d do a blast from the past for today’s video to take a look at just what goes into that thought process. It’s a blast from the past, because it’s a video I recorded about three years ago, when I was working with people who are becoming real estate syndicators and real estate fund managers. But the the information in it is absolutely up to date. It’s timely, and I know you’ll find it useful.
We are talking through the core right now we’re talking about companies specifically Foundation. And in this segment, we are going through structure. Now why are we going through structure? Well, structure is obviously kinda like the foundation. So it’s what everything is based off of view structure at right, it makes it much more easy to grow, makes it much more easy to do what you want to do. And it also can protect you, as we’ll talk about soon. So, first, before we get started, I’m going to use a couple terms here that we may not have gone through yet. And you still you may not have seen the segments yet on LLCs versus corporations. And I use and we need to go through specifically two terms, which is member managed. LLC is vs. Manager managed. LLC is now a member managed, LLC basically means you’ve got people who are all part of the same LLC. So this is a property LLC. And each person gets their own vote, and they all have control equal to the amount of shares that they own or the membership units that they own in that LLC. So this becomes very, very hard to manage, you’re basically going to be ceding control to all of your all of your investors in order to get things done. It makes it so that you it makes it hard for you to get paid. And basically, it’s kind of defeatist in your in how you want to do things. Now, you actually may use this member managed in one particular context. And that’s the joint venture. And we’ll talk through that about what joint ventures look like. But most of the time, you are not going to do this, a member manage instead, you’re going to do a manager managed LLC, which basically means that you or your entity, and we’ll go through that have the control over the LLC itself. And your investors have only the voting rights that you give them in the operating agreement. So I sent that out because I’m going to talk specifically about member managed or manager managed in the first way that you could do this now, the way you can structure a syndication and the way a lot of people do. And these are people who have not gone through our core, they are not members of the altitude syndication founders club. This is the way though that most syndications take place. And there’s actually a very big mistake that goes on when you’d set it up this way, and we’ll talk about why. So let’s say you have identified a terrific building. And I think this is just perfect for investment investing. It’s gonna make you and all of your investors a lot of money. So you go you put a down payment on it. And then you call up your friends call up Bob. You call up Joe. And, and maybe three or four other people, they all contribute money into the property as well. So yeah, smartly decided, okay, well, I’m going to create an LLC and that’s what’s going to own the property. And so we’re going to call that property LLC. And I am going to set this up now one of the decisions you made when you were setting this up, was it was either going to be managed or managed or member managed. Hopefully most of the time you will choose Manage your Manage after we had this discussion, because then at least you have some control over the property itself and over your actions. But here’s the problem with this very simplistic form of structure for syndication. Let’s say there’s Bob over here. And Bob has decided he just doesn’t like you. He just thinks, you know, you sold them a bill of goods, and he doesn’t like this property, Joe’s totally thrilled with it, and so are your other investors. But for whatever reason, Bob’s gone off his rocker, and just doesn’t like it anymore. So now he’s mad. So what’s Bob do? Well, we’re in the United States, and I’m a lawyer. So I always see it this way, he is going to file a lawsuit, and he’s going to file a lawsuit against you and the property. So he’s mad, he wants his money back. He wants all these other things. He wants punitive damages, and he wants to punish you. And the property and anyone who has any association with it, you’re all bunch of jerks. Problem with the way that the structure is set up in this instance, is that you now are have exposure to this lawsuit. So this lawsuit exists. So there’s an indemnity clause, no doubt here. But it’s not as effective as you probably would like, because ultimately, what is your choice to do, you can’t just bankrupt this property LLC, because you’ve got all these other investors out here. So things go horribly, horribly wrong. And you just want the whole thing to go away. You can’t even bankrupt that property, because now all of these people needed need their money, and you are also on the hook. So you’ve had control over this property, if you’ve set it up as a manager managed LLC. And so you are acting kind of like if you’ve heard of GPs before general partners, the one who’s responsible for everything and you are subject to the claims against the property, LLC itself. This is not the way to go. But this is the way that actually most small syndications are put together, this is not the way sophisticated syndications are done. So what are some How are sophisticated ones done instead. So we still got this, we’ve still got you obviously. And we’ve got this terrific looking building here that you know is going to make a ton of money and you’ve got your investors and this time, this is a whole new one you’ve learned your lesson. So now Joe’s got Bob’s gone but now you’ve got Joe and you’ve got Sue and both of them invest their money into this great property. And we’ll call it property to LLC. But now you’ve learned your lesson, you know that the exposure if you were just to put your money and put the deposit in on that property, you know that you’re being exposed so what do you do instead, you create another entity here that is you management Inc, and we’ll go through entity choice of entity but many times this will be a corporation sometimes it’s an LLC for this purpose it doesn’t really matter. So you you contribute your deposit money into you management Inc. and then you through you management Inc, you make the downpayment in the property, start gathering up the investors and things like that now property to LLC, pays management fees and other fees to you Management, Inc. So if Sue suddenly decides that she’s mad at you, she can sue sue the property, she can sue you Management, Inc. and she can sue you personally. So what have you gotten out of this? Well, because you’ve done it through this company so long as there isn’t fraud, you’re actually not liable and the courts not going to really recognize that as a lawsuit that’s, that’s meritorious. So it may be meritorious against you management Inc, or prop two LLC, but at least you’re protected and now all of your other assets are protected as well. So this is the normal Wait, I’m gonna just get rid of this lawsuit because this is the normal way to do it. And we don’t want to be associated with lawsuits anymore. So let’s just get rid of that. All right, great. So this is the the normal way to do it. You’re happy You and your investors are happy. So this is this is the most common structure that you’re going to do. This is a management company managing the LLC itself, the property LLC. So this isn’t the only structure. So one other structure that’s a little more advanced is basically you have, you’re still here. And now you’ve identified not only one really amazing building, we’ve actually identified two really amazing buildings.
And you think that there’s this other building out there as well, that would be amazing. You don’t know exactly what it is, but you’re going to find it and you’re going to, it’s going to be a perfect investment for your investors. So what do you do here in this case, so these are all different properties. So let’s leave this property, a LLC, property B. LLC. And after you find it, it will be property C, LLC. Now, you still have your management company.
And but how do you do this, your investors who are here have a choice, here’s Joe, your Sue. They could put money into you management, but then again, we’re not shielded against them. So we actually build another LLC or corporation here. And this we could call Investment LLC.
And your investors go there, investment LLC buys and manages these properties. Investment LLC is managed by you. And pays fees that way. So now what you’ve done basically, is you’ve built out a structure where one entity that’s easy to manage, can manage multiple properties all protected and shielded, can manage its investors, and so and protect, and basically be able to treat investors efficiently. So the amount of money is all treated based on how you however you design to do it. But typically, it would be they’re all you know, if if they put in if Joe puts in 50%. And Sue puts in 50%. You know, they each have 50% ownership in all three of those buildings. Now, you may be asking, Well, why are we doing the extra work of having these other LLCs here. So the great example of this exact situation is the ghost ship. Ghost Ship, I encourage you to look it up, look it up on Wikipedia, there’s a really good description of it there. And then there’s some links within that to different news articles. But what happened in the ghost ship, so the ghost ship was an office building in Oakland, California. Some of the tenants decided to convert it to live in lofts and a dance hall of sorts. And there was a fire that broke out now the ghost ship was owned by a trust, who was owned by one person. So but the trust didn’t only own the ghost ship, it owned something like 13 other buildings. So all the value of all of that was owned by the trust, which ultimately was owned by this one person. So go ship firebreaks out 20 people died family Sue against the trust, who’s the owner of the building. And now because they now because there’s one entity that’s being sued, all of these other buildings are suddenly vulnerable to have to losing everything. So if they were done in this manner, in the manner that we’re talking about here let’s say there was a major slip and fall on property a that’s somebody’s fault lying on the ground. That was really bad and and you know, they lost their leg or something and property a isn’t very big. So they would file a lawsuit against property a and they may try to get to investment LLC, but they’re probably not going to, to have that chance to get further up the line unless there’s been a case of fraud or something like that. So property a LLC, they file a lawsuit. And if it just doesn’t become worth it anymore, property A goes bankrupt. But property B and properties, these still exist and Joensuu still own their 50% portion. So they’ve been protected for that. So that’s why we we separate, each building has its own LLC. So the last way that you may encounter, putting together a syndication would be something like this. So you have identified a terrific building an apartment building that’s worth that’s on the market for $2 million. So the, this is a great opportunity for you, you decide that you want to buy this because you see how much upside there is, but it’s going to take a lot of work.
So you put your money in, you don’t have any invest any development experiences. So rather than seeking investors for this property, you seek a different kind of investor, you seek a joint venture. So say, you know somebody who owns the company development, Inc. and they are a developer and are terrific at rehabbing apartment buildings. It’s owned by two people’s it’s like two brothers. And they own that. So you have now contributed $2 million into this building, and they are contributing, say their time and materials into improving it into what it is. And then when it comes time for, for receiving money. It goes according to however your joint venture agreement has been written. So your joint venture agreement is kind of the umbrella that covers all of this talks about what your duties are and what the responsibilities are and how everybody gets paid. So let’s just recap for a minute. This way of doing things here, where you’ve got everybody investing into the same LLC, including you is just not going to work. It doesn’t protect you from litigation, this is the most common way to do things. So this is the way let’s separate that. This is the way you’re probably going to set up your first several syndications, it may be the only way you use to set up syndications because it just works great. You can also have different investments and still have you as the management. So this is prop three. LLC, which has its own investors.
And this may be how you structure your entire fund. Or maybe you decide you want to become more like a fund and do it this way and have people invest into your investment fund whichever way works for you. This is the basics on how you do it. So this is the structure to keep in mind. Now I encourage you to actually draw out what structure you think is going to fit your needs the most. Is it something like this where you’re going to go property by property? Or is it something like this where you’re going to have a pool of funds a pool of money in order to buy several properties at once. Most of them view will probably be doing this but some of you may be doing pools as well. So I hope that was helpful. Draw out your diagrams, and we’ll see you in the next segment. I hope that was helpful for you. My name is Tilden Moschetti. I am a syndication attorney with the Moschetti Syndication Law Group.
You want to put a syndication or a fund together? Well, you probably want to get paid for the work you’re doing right. So in this video, we’re going to talk about the different fees and split structures that exist. But we’re also going to talk about why I think it’s important to separate the two and your thought process.
When we think about fees, I think the most important thing is think about it like your pay, it’s the pay that you get for the actual work that you’re doing. So that pay itself should needs to be commensurate with not only the amount of work that it’s involved, but also your experience level and time spent away. Now, if you were doing all the accounting, you should get paid for that. In here, you’re oftentimes doing different things like the asset management, or you’re putting together the acquisition or disposition of specific assets. So you need to be compensated for those. So let’s go through the basic fees that I see in most of my structures. And in this case, we’re going to really probably be talking more about real estate fees, just because in a real estate syndication context, because that’s more commonly seen as having the more amount of fees. So let’s talk about those. So the first type of fee is, of course, an asset management fee. When we talk about asset management, that is the fee that you should be earning for the work that you’re doing in order to keep the asset itself managed, or the assets managed. So it’s keeping that fun to go in. This is things like investor relations, it’s things like the backend accounting before you hand it off to an accountant. It’s the keeping the day to day keeping an eye on the market, making sure that when’s a good time to start disposing of these assets. Those are typically the thought process behind asset management fees. Now, the percentages of that we that syndicators and fund managers typically charged for asset management fees ranges from about one to 2%. But the question really becomes one to 2% of what so that what most of the time is the amount of money of that have been raised from the investors. So it’s that capital accounts, that is typically used, some people prefer to use gross income, other people even use net operating income, those obviously would be lower amounts of fees. And the reasoning is because they don’t want to be charging excess fees, they may be making their money elsewhere, like in the splits, which we’ll talk about in a little bit. Besides the asset management fee, a lot of developers developers of real estate will charge a development supervision fee. And this is different than a developer’s fee, like the regular fee to actually be doing the development itself. But it’s that relationship between the syndication or the fund itself, with the developer that’s being covered here. A lot of times that supervision fee is around 10% 10% of hard and soft costs as they’re incurred. That’s just a general ballpark that I see probably more often than not. Another type of fee that we oftentimes see is property management fees. Now a lot of people will put their property management out to a third party. And that’s definitely a good idea because your your specialty is, in this case, in the fund or in the property or in the asset management itself for the syndication. Now, if you own a property management company, you’re obviously going to keep that yourself and be earning those fees. Also, it’s worth thinking about, maybe you want to keep the property management itself, if it’s something like a triple that property where there’s actually not that much property management that goes on, and you may be able to pass that off to the lessor of the property. And so I mean, the lessees of the property itself. So to property management, it’s still a fee, and so it still is part of what I consider part of the fees, whether you’re keeping it that we certainly put it in there, or if you’re not keeping it will probably just make reference that it’s being paid to a third party. Another type of fee would be the acquisition fee or disposition fee. Acquisition and disposition fees are typically around 1% One and a half percent of the purchase or sale price of the asset. This is for all the work that puts that goes into actually acquiring or disposing of the asset. So gathering due diligence material, reviewing all those things, that takes a lot of time and it should be compensated for that. Lastly, a the nor No Fee category would be real estate agent fees, real estate agent fees I put here, even though probably if you’re doing a real estate deal itself, those are getting paid anyway. But if you as a sponsor are getting paid those fees, it needs to be discussed. And this is just the best place to put it when we’re talking about management fees. The reason we need to disclose it is not only because because it’s a fee there, but it’s also represents a conflict of interest, it is possible and a lot of times we’ll disclose that, it’s that it’s reasonable to believe that maybe the sales price could have been higher, if it wasn’t being represented by somebody who also had the split loyalty, or the purchase price might have been lower. It’s not It’s definitely not the case all the time. But we’d like to put it in there just so that we’ve made it very clear that there is a conflict of interest. But we’ve now disclosed it, there’s a few other kinds of fees that are less common than the fees we just talked about. That would include like a finance fee. So the fee associated with putting a loan together and making sure the financing is there, that fee is generally somewhere between half a percent to as high as a point and a half for the amount of for that work. And it’s all based on the amount of the load that’s being got not on any other parts. Another kind of fee that happens from time to time as a marketing fee. A lot of times you’ll see this if a broker dealer is involved, because you’ll have a marketing fee as well, which is the cost of putting all the material together for the broker dealer so that they can do their work and finding investors. Lastly would be like a startup fee. So startup costs, so this is normally a reimbursable expense anyway, those costs, but the startup fee itself is for the work of putting together the syndication itself. And that that body of work, it’s not very common. And normally, if it’s there, it’s somewhere between one or 2% of the total amount that’s raised, but it’s not that common. Now, so fees in general should be thought of as your income, it’s probably being taxed as income for you. So as you begin earning these fees, it’s probably paid out upon receipt of completing the work. So the IRS was going to say it’s income, and it’s probably is counted as such, different than fees is splits. So the splits we can think about as the profit part. So you have you regular income. But the other piece of the puzzle is the profit that you’re making, from having done all this work. So it’s not the income side, but it’s that profit piece, a lot of times, and you should definitely speak with your accountant about this and make sure that it’s kosher. But a lot of times, what we’ll do is, is Pete is syndicators will put those put those splits in on the the capital gains side of their returns that have a lower tax rate. Now, they need to basically have invested money and have money at risk in order to be doing that. But again, talk with your accountant and see if this is an avenue that’s available to you. Because you can save a lot of money and you’ll make more money that will be in your pocket at the end of the day. There’s three kinds of basic splits that are out there in the world. And so the first one that’s definitely the most common would be a waterfall split with or without a preferred return. So the preferred return is that percentage that you’re guaranteed gets paid to the investor before any other distribution of profits can split out. So they get their money back and they get any sort of profit they get whatever that preferred return is as that first in line, there may or may not be a catch up for the manager, but that’s not really relevant to this conversation. Other videos talk about that that I’ve put out. So that waterfall that has the preferred may or may not have a preferred return, it may or may not have a catch up. And then at that at some point, it will have a split like you oftentimes hear about 80/20 or 70/30. Those are the splits. Typically it’s about 70% or 80% or 60%, or whatever that percentage is goes to the investor and the remainder goes to the sponsor. That’s not always the case. It always depends on how the whole financial structures but setup I’ve done deals where only 10% of the profits go to the investors where 90% goes to the sponsors because they’ve given the the investors so much reward as part of a preferred return or something like that. That they Want to make it something marketable, that would still, you know, basically still be investable, but still make a lot of money for themselves as well.
The next kind would be straight equity. So you’ve got a property, you’re buying it for 5 million, but the reality is that you’re actually buying it for 4,500,000. And you’re charging to your investors it as if it was a 5 million property, you’re taking 10% off for your own equity. So you’re keeping 10% of the deal. And they’re getting the other part, I call this straight equity. The reason or sponsors equity is another name, I use it sometimes for the reason why this is a great deal for you is you’re guaranteed you’re gonna get paid. So if the property gets sells, even if it sells for 3 million, you’re gonna get that 10% of that 3 million, you’re gonna get that $300,000 Payday even if it goes under market. So it works out very well for sponsors. Individual investors may or may not like it, they may object or have questions to it. And if your deal works for it, great. If it doesn’t, then you know, you probably should choose some other avenue. The third kind is what I call a harvest per boat. And this is actually pretty rare, but I think it’s important to talk about because it is out there in the world. A harvest promote says, Okay, we’re gonna sell the property, or sell all the assets at year five, or whatever that time is, once we’ve sold, we’re going to return all the money to investors, once investors have been getting paid back, at that point, the sponsor is going to take the first 10% of profits for themselves. And then the rest will be given out either as a split or given out as straight to the investors. So that way the, the sponsor is as long as it’s profitable, is going to be making good money on it. But it put it puts the relief on the side of the investor that, hey, at least I know I’m gonna get my money back before the sponsor makes any money. So those are the general types of splits now splits again, think about those as the profit center. So that’s you profiting from it, not the regular pay that you receive for day to day work. So I hope you found this video helpful, because what we’re trying to do here is we’re trying to talk about these two categories that are going on splits and fees. Now, many, many people come to me every day and asked me about this, or what sort of split Should I have? Or what sort of fees should I be charging? And the answer is, well, let’s look at your numbers. Let’s see what you’re doing. When I get hired, most of the time I go through in detail the financial picture of it, I don’t give up my opinion as to where I think they’re out in the market. If I think that they’re charging a lot of money in terms of fees against investors, I’ll let my clients know that because I want their product to be marketable at the end of the day doesn’t do anybody any good if it doesn’t, if they can’t get investors out there. So but I also want my investor, my sponsors and my fund managers to make as much money as possible. So many, many times, I’ll go through what those numbers are. And we’ll talk about, well, maybe if we tweak this, or maybe if we change this, we’ll get a better return that will be more marketable. Because really, at the end of the day, your investors care not only about what the story is about it, which I do believe is probably the most important thing that you’re you have to sell them. But the second most important thing is that number of what that return is because they need to understand what it is if it’s if it’s an 8% return or a 20% return whatever it is, if it’s something that they’re interested in, they’re going to invest. So ultimately, we want to end up with a good solid return that they can rationally believe in so that they can then buy into your story and be a part of your vision that you’ve got as your syndication or fund takes off. My name is Tilden Moschetti. I am a syndication attorney with the Moschetti Syndication Law Group. If we can help you please don’t hesitate to give us a call.
The two jobs of any size fund manager or syndicator, is this is finding deals to invest in, or number two, finding investors to invest. So in this video, we’re going to do a blast from the past from my coaching days, where I do a rapid implementation call on how to find investors offline, I know you’ll find it useful, because it’s got so much information and please review it, and I hope you enjoy
it we are gonna go deep into finding investors offline. And so you’re gonna find a lot of value in this program, I hope, because we’re gonna go really deep, like I said, but we’re also going to be exploring, like what all those steps are. So at the end of today’s call, you should have an action plan of exactly what you need to do in order to move forward and take those next steps in order to get investors ready and lined up. Alright, so let’s go ahead and get started. I want to start with basically a principle of spheres of influence. Now, we’ve talked about this before, but it bears repeating, and it bears repeating, because it’s so incredibly important. And the more that this is just ingrained in your DNA, the more successful you’re going to become. So let’s start with your inner circle.
These are the people that you know, they’re your friends, they’re your family. They’re your partners, they’re people who are very, very close to you. And that you know, so well. Outside of that we have the people who were your previous clients stood.
Right, so those are the people who you’ve worked with before the people who’ve you’ve actually done business with. Now, both of these categories, our mark would qualify for being unaccredited. Investors, if you chose to do a Reg D, Rule 506(b). So these are the people who you either are in your inner circle, and so are so close to you that it’s presumed you’ve done business with or your previous clients, those who you really have done business with, could all qualify probably as you’re under 506, B for unaccredited. Investors. So these people, you don’t need to worry about talking about your investments to now, I mean, you don’t need to worry about, you can just talk to them about the investments, and they can subscribe if you are not in a 506(c) where you’re allowed to advertise. So then we have the category of the people that you’ve met with. So these are people who know who you are. And they know what you do, you just don’t really have a business relationship with. So if you’re a real estate agent, you may have met with them before and you may have done a listing presentation for or you may have cold called them a few times or met them at several events, these with people in that category. So you’ve met with them, you just haven’t done business with now these people I do not believe would qualify for the 506(b) so that’s where we start taking a step outwards. And I mentioned that just to give you a point of reference, then we have the the target people
you haven’t met so these are the whales in your community that you think would be excellent investors for you. Or referral sources. You just never have spoken to them. You just don’t know them. Or you just know them so little that they don’t know your name. And then finally we have the public these are the people that you have never met with you don’t know who they are. They’re just way A way outside of here. So this is the categories that we’ve got, right, we’ve got the public, we’ve got target people that you haven’t met, met with and previous clients. Now the goal here is to move for each one of these them down to the next category, right. So those people, we want to become closer and closer, ultimately to your inner circle, or that become major, major clients. Now, obviously, if you don’t like any of these people, and you don’t want to do business with you don’t bring them into your inner circle, I shouldn’t need to say that. But I will just to, to cover all bases. So for each level, there is a different kind of program on how we deal with these people. So your inner circle, let’s, let’s actually start with the public. So this is your advertising. Right, so you may choose to do advertising and to, you know, bring people into Okay, those people might be target, maybe I’d like to do business with this is the mechanism that you would use is advertising. prospecting, on the other hand, is for those people that are targets for you. So the ones that you know, are gold nuggets that you want to bring in closer that you’ve met with and become clients of yours. And then inside of inside the met with category, most often times, we’re talking about some sort of drip campaign. And I’m gonna go through a specific about what that would look like in a minute. And then, in our previous clients, we or we could say clients, those are that would be something like a call and email campaign, you spending more and more time nurturing these people, the closer that you get them into your inner circle, and your Inner Inner Circle really is your one on one. items. So let’s change to exactly what who these people are a little bit more specifically. So here we are talking about me, too. So we’ve we’ve done this discussion before about whales versus, versus fishermen. And so that’s an important place to start because there’s actually two different kinds of people. So we’ve that worth looking for. Right?
So fishermen, right? What is a fisherman, they’re the ones with the big rod. Looking for the next person for you. So this is the one to many resource that you may have the strategy where those fishermen can bring you deals and bring you investors. And then, on the other hand, we have whales. And I can’t draw a whale, so we’re just going to draw fish. But pretend that’s a whale. And so the whales are those big, the big cone as the ones that you really want to be part of your investment. So for fishermen and whales, there’s actually two categories of of these kinds of people that we would be interested in. So we are interested in referrals.
And we are interested in investors. And there’s actually whales in both. And there’s fishermen in both, right? I mean, there are fishermen in the investment community, the guys who talk a lot about their, around the golf games with their buddies about what they’re into. Who can bring knew all of their friends. You know, many of the investors who I’ve had in my syndications have come through referrals from people who are already invested in the syndication. So those people were acting as fishermen. And anytime they were whales as well, for referrals, we can have fishermen, who bring us lots and lots of investors. Or maybe it’s just one that that has a relationship with someone really big one, like a whale that you’d really like to bring in. So if you think like a personal manager, or a family office, or something like that, that whole person could bring in a gigantic wave for you. And so that referral source might even be just a whale themselves. So there are principles going into, into building referrals to go through. And so first, we have, we want to educate and add value. I mean, we, in order to build a good relationship, you need to be giving into that relationship, right. And so we do that through our our ability to educate about the real estate industry, about investments about those things that you know, and, and really add value to their lives. So this can be in the form of, you know, if you’re coming from the residential community, this could just be you know, they providing information about what homes are, or real estate in general, or, versus if you’re a commercial agent, maybe you’re giving very specific information about what’s going on with a particular development in the area. It’s that education and adding value that builds that relationship. Number two, what a lot of people don’t do is ask for help. So most people make the mistake of building referral relationships. And they completely failed to ask for help at all. So they go into that relationship with not really getting anything that they need, because they never asked for it. So the Bible says Ask, and you shall receive and it’s that ask that’s required, right? So we got to ask. Third is we reward. Now we’ve talked before, we can’t give fees, referral fees, necessarily on to our referral partners on when we’re doing syndication. But what we can do is make sure that they’re rewarded in some way, maybe it just take him to dinner, or maybe you take him to the golf, get a golf game, or to the some sporting event or something, just to say, thank you so much, there’s nothing that’s stopping you from just impromptu sending a bottle of wine or doing something in order to give a gift to say thank you for that referral. And you should be doing that reward always. So you should always be doing that. If they if they provided a referral to an investor for you. you reward them, and you make sure you reward them whether or not the investor actually did decide to invest because they they did what you’re asking them to. So you’re teaching them to do what’s important, by giving them that reward. The fourth principle is this idea of givers get to build a great relationship and a great referral source. It’s that idea that if you put everything into that relationship, and you give, give give, you’re going to start getting back in return. So one of my, one of my coaches, early on, gave an idea about how to do this. How do we even begin the givers get idea when building refers referrals? And he said, what you do is when you’re sitting down for coffee with them at the very end of the conversation, you say to them, Look, if I run into somebody who’s a perfect candidate for you, or if there’s somebody on the street, who’s, you know, just write for you? How will I know that person when I see them so that when I see them? I know I should give that referral to you? Who’s your perfect client? I mean, who are you looking to find as get referrals for? So that’s the question that you give, and so that you can give that referral out. Now, you may not know somebody right off the bat who needs that service. It’s there but it’s gonna go in your mind and it’s gonna be something that you generally can think about and use certainly should be keeping track of this and your CRM as well. So that idea of, of, you know, who’s that ideal person is, is a is an important question to ask. It’s probably the most important question when you’re beginning a referral relationship. Now, why is it the most important, because what you’re actually doing is you’re offering value upfront. But secondly, it’s a weeding out process. So it’s a filtering process that takes place. Because I know if I ask that question, and I get the answer, and then if the person who’s across from me doesn’t say, Well, why don’t you tell me who the perfect person is, who you are looking for? If they don’t respond back and ask me the same question, that’s a relationship that’s going nowhere. So that’s a relationship, it’s not worth even keeping them in your Rolodex. So givers get, so let’s talk about the steps to build these relationships. So
there are five steps in building referral relationships. Step one is you build a list. And so you generally think through all of the categories of those people who you think would add value to you is that your wealth managers
these are the ones most common for for syndicators, wealth managers, accountants
small business, consultants and the big kahuna. Real estate agents. So while most of you are real estate agents yourselves, and they may think of these people as competitors, they’re actually not. We’ve talked about that before on finding properties. And they’re also great resources in order for you to find investment investors, because they’re talking to people about real estate all the time anyway. So you build that list. Next, you make contact. And so those are your calls. You drop by bys. Meet on Zoom. So I know we’ve gone over this before, these are the steps that you need to be making right now. So we’re going to as part of the work that we’re going to do and the email that will come out about this, these are the steps that I want you to identify and I want you to start laying them out exactly what you’re going to do in order to build your referral relationships. So yes, we are repeating to some extent, but the point of it is to make sure that that there’s that forward progress, because these reforms, referral sources are critical. So step number three is follow up. And this can be nodes, calls, whatever. So follow up but now we’ll talk in a little bit about a follow up program, different follow up programs and I’m going to give you actual specific programs that you can implement immediately and that you can design and make just perfect for you. We’ll provide those templates for you as well. Okay, step number four is you provide access Excellent. Service it’s nothing worse than giving a referral to somebody and the service that that that your, the person you referred is getting from them is awful. And they and you will never get another referral from them. Again, if you don’t provide exceptional service. This is as simple as you care. And you communicate and you communicate to both people you communicate to who was who was referred to you and you communicate to who was referred, who referred that person to you. And then five, show your appreciation In always, always, always go the extra mile. Okay, so these are the steps for building a successful referral network. Now we’re going to put this into a list, so that you can have basically a template. So now you’ll have your own template for building your own action plan. And that will come along with the notes for this call. So under investors now, there are some principles that are a little bit different. And there are some principles that are the same. The first principle is exactly the same. Educate. Guys. So I was at a Tony Robbins event maybe four years ago, and Tony said, something that still sticks with me every time I write like something like educator of add value down and snapped into my head today. And that’s in order for people to listen to you or want, you know, listen to you cold and want to do it, they want to know what’s in it for them. So give them something that’s in it for them. And those people want to have a better life, they want to level up, they want more money, they want more love, they want more something, and they think and one of the tools for doing that is knowledge and value. And so by offering that knowledge, offering that value, you can create that for them, and they’ll want to speak with you. So it’s first offer to help. And then we go from there. Number two, and this one is absolutely critical. Show up like no one else. You are not the only option out there for people to invest in, you does not there are other investment opportunities out there. And there are other, you know, fit places that people can place their money. So you need to show up like no one else. So we talk about show up like a professional all the time, in our pamphlets and our marketing materials and our PPM and our operating agreements. Everything we do we show up like a professional, we show up ready and prepared. And already that puts us showing up like a lot of other people don’t. But now it’s show up like absolutely no one else by providing exceptional value and exceptional service. I mean, think about how Disneyland does it. When you go to Disneyland? Is there any other place like it on Earth? There really isn’t. It shows up like no one else. I mean, it’s designed to just be absolutely different than the world that we live in. And that’s what people remember. And that’s what makes people that your raving fans. And that’s what will get people to want to invest with you. Because it’s not great enough to just have them think you’re interesting you need them to want to invest with you. Principle number three is care. Ask what they are looking for
it goes down to the the idea that we’re born with one mouth and two years. So we need to do twice as much listening and that we do with talking. So ask what they’re looking for really kind of explore that and really just care about what your investors are wanting. It’ll come across instantly to them. Number four, again, givers get if you do these steps, one, two, and three, you’re going to be giving a tremendous amount of value and you’re gonna start getting so what are the steps in order to to really start caring and nurturing and finding your investors. So let’s go through those. And again, this will also come in a template and I want everyone in the group to be working through that template and filling it out. You will be using it, it will add value to you, and it’s gonna help you get investors right away. So step number one, what do you think it is? It’s build a list. Right, we got to build the list, we’re starting to identify targets, to start thinking about who everybody is, and all those categories, who are all those people who are in the, in your inner circle, who are all of your past clients, who is everybody that you know, who does real estate or is interested in real estate or cares about real estate, comb through your LinkedIn, comb through everything, and try and figure out who those people are. Then, once we’ve done that, let’s we categorize them. And so we put them in, okay, this person is in our inner circle, this person is in our clients bases. This person is in met with this person is in our, our target, but I’m going to use the term that we used before here in our dream 100. You know, or is there a certain demographic that you’re interesting, interested in marketing to, you know, who is that put them in the public? You know, I want to reach out to small business owners in this category, I want to be reaching out to people in this area who’ve had a liquidity event, there are ways to get that information. Alright, so once we’ve identified once we’ve started building out that list, then we need to put together different programs in order to communicate. And so the first program is the one on one program.
These are people primarily for your inner circle. And so this is making a conscious decision of, you know, how often are you going to go out to coffee with people? How often are you going to take them to dinner? How often are you going to take people to golf games or sporting events? How often are you going to do that, put it on your calendar, is it every Monday and Wednesday, whatever it is, put it on your calendar, and just make sure that you fill those spots. And then also, regular phone calls.
And how often you cycle through that list, if you’ve got your list of say 50 people, you should be able to go through, be able to call them once a month, maybe you don’t want to call them once a month, maybe it’s once every other month or once a quarter or once every six months, whatever it is, make a conscious decision on whatever it is. And then make sure that you’re showing up like no one else. And always ask them how they’re doing if they need anything. And then you can filter in some of the the information of what you’re working on. But really, it’s to make sure that you are top of mind that you are one of the givers so that you get number three step is a is your call or email program.
So I put together a program that I actually stole from Gary Keller. So this isn’t, this isn’t my brilliant idea, but it is a brilliant idea. Nonetheless, so he has two different programs. We’ll put him here. He has what he calls the eight by eight and he has 36 touch or 32 touch I don’t remember how many touches he has. So the eight by eight program in short is a program where you are actively every week doing one proactive thing in order to touch that prospect. So typically, we are doing this on our on our either our prospect list or we’re doing it with people that we are clients or that we’ve done business with just to make sure we’ve got a nice solid relationship with them. And so the eight by eight program looks like this
Alright, so the eight by a program says for is that you’ve got the eight weeks.
And for every one of those weeks, you’re doing one very specific thing. And it can be any sort of specific thing. But it’s something that you’ve actually planned out and is ready to go. We’re trying to make a system here. So not something that’s just not something that you kind of do ad hoc, say, oh, yeah, we’re, I’m in now on week three, I need to figure out what to do. No, you’ve got it all planned out. So this is just a sample a buy eight, we’re going to do right here. So you do not need to do this. This is just to give you the idea about what it exactly looks like. So we’ve got 12345678. So say, week one, you make a phone call, and you talk about the market or you talking about whatever is going on in their lives, you add some value into that phone call. The second is you do a letter, send a letter of introduction. Obviously, if you know them, they know who you are, but they may not know what you’re doing, and try and add some value in there. And I would say even more than just like a business letter, send it in a card. So it’s actually interesting and actually gets opened. Number three would be maybe it’s a flyer about your fit you know, something of interest there. Right? We’re always trying to make it more and more interesting, make it engaging, make it something memorable. Number four, maybe it is you you provide some market info you know, you’re all in real estate or in the market somehow provide them some some market info of value. You know why? Maybe it’s why doing investments is good, maybe put together a flyer about why it makes sense to to invest in syndications. Number five, is maybe an update about what you do.
Number six, maybe it is something of value, maybe it’s maybe it’s more information, maybe it’s a comps, maybe it’s something that something that you know, that adds value to their lives. Number seven, maybe it’s more market info. Number eight, maybe you call them again, it’s not important, what I put here as the eight things. What’s important is that you develop your own system of eight things that you’re doing that you’re going to do every week, and you keep track of these in your CRM, you definitely can use the one that app dot how to two dash syndication.com. The, that’s a great system. In order to keep track of these people, you can build out a pipeline of 12345678 you can even build it out. So it will tell you and it will remind you of when those things are due. Okay, we’re in one so we need to make that phone call. Okay, we’re in two, I need to send them that letter and three, I need to send them the flyer and number four, I send them market info, I can build out all those tasks so you never have to keep track of all of this in your head. It’s just all automated into a system. So the other idea is this idea of 36 touch so once they people have gone all the way through the eight the eight weeks, you they now know who you are. So these people know that you exist and so that you are somewhat on their mind. So the 36 touch is really just okay now how are we going to stay in their mind and again, we’re showing up like no one else because other than some residential real estate agents who happen to be in my area and probably are with Keller Williams and got the book from Gary Keller. There’s no one showing up let like this There’s no one, even those best agents in my neighborhood are not showing up like they could be, they’re not showing up as good as this. And so if you want to this absolutely applies to to your regular to your day job as well. So, so we in the 36 touch, we break it apart into a calendar year.
All right, so now we’ve got a whole calendar year. And so once people are done with that eight by eight, they just come into this wherever they’re at. So maybe, so what’s what are things that make sense to do? The first of the month, is maybe it’s a, it’s the new year. Either like a strategy mailing or New Year, Happy New Year’s card, because a lot of people get holiday cards, but no one seems to get new year’s cards. Maybe on the 10th, maybe you send a you know, your market forecast.
On the 20th, you do something, and then I’m just gonna write these really quick.
And you don’t have to do these dates, they just make sense, right?
It can be whatever.
And so we just make it equal 36.
You know, et cetera, et cetera. So maybe on the first email, a holiday card, so I always put down, you know, what are those holidays or things like that, because they are getting holiday cards from everybody. And you might as well do holiday cards, as well. If you’re coming need to come up with ideas. First is, you know, Fourth of July card. And then start thinking about, well, what are these other things that are going on that I can I can give people some interesting information for, maybe I can give them some information on taxes, or something like that, maybe I can give them something, you know, the, the co star reports come out in maybe in around the 10th, well, actually, they come out around the first maybe I give them the co star or report on what’s going on in the market that you’re serving. Or say recon is in May, maybe I and I do retail, maybe I give them notes, on recon. Whatever it is, as you’re part of your day to day activity, you’re coming up with this list, in order to add that value. The template is going to be sent out in along with the emails. And so I want to just reiterate, this is this is building your system. And if you do this, right, you can actually automate so much of this, these kinds of interactions, you could automate it with by combining what we’ve got for your tool for your CRM. Now, to automatically send holiday cards, I can let me know if you want to go over that in detail exactly how you can do it. You can set this up to do very, very, very little work for you, except maybe making a call every now and then and and have everything very systematized and automated. So you don’t need to worry about your maintaining that relationship with your clients other than what really matters. I mean, getting to know them getting to understand them, not having to write out the card and send that to them. So that is the idea of the 32 touch and the eight by eight. So let’s go back over here. So this was where we were at talking about, about investors and what steps you do. So that I hope that helped, we’ll send those templates to number four is his prospecting and coming up with a prospecting game plan. And then doing it. I mean, first is how I mean are you going to be doing cold calls? Therefore definitely can, you know there, you can definitely do cold calls, if I was going to be cold calling right now, who would I be calling I would be calling I would call small business owners.
And I would be calling anyone with liquidity events
and maybe I be be looking at news. And let me go through that. So small business owners What I mean is calling smaller businesses in the area, one of my best investors who’s been in multiple syndications with me, was a cold call in, they just happen to own a company that any add extra cash sitting around one, another one also came out of a cold call. And he owned a company that spit off so much cash, and he needed to just place it. Another small business owner, who’s been a major investor, for me, was somebody who I knew only as my, my eye doctor, and he turned out to be a major prospect for me, and ultimately invested in a lot, put his wife in a lot. They invested quite a bit. So that’s what I mean by small business owners, you can get that list, I can even help you with that list. If you want to say, hey, I really would like to find small business owners, primarily doctors, or dentists or people with that kind of cash flow in my area? And can you make me a list of it? Yeah, I can. So all you have to do is ask. So just let me know, I can get that all set up. And we can do it together, I can show you how to do it. Same idea here. Anyone with liquidity issues. So just like here, I can help you with this, and I can help you with this. The caveat is you have to promise to use it. So I mean, it does take me a little bit of time to do. And so I am happy to do it beyond happy to do it, if you use the work if you use the data. But if you’re not going to use a dump, don’t ask so that way. I’m not don’t spend my time. But there are tools out there that identify people with liquidity issues. So for example, I can through a tool that I have, it’s called a identified it, what it does is it’s combs through all the SEC filings, all of the news filings, everything that’s out there in order to build this idea of who is having a liquidity event anytime soon. And it’s surprise and who they’re connected to how and and how they’re connected to you. It uses LinkedIn as as kind of its back end of database of who they who these people are. But then they’ve got their own proprietary data about what’s there. But anyway, that program is there. And, and we can certainly explore it together. I actually haven’t used it too much. But as I build my list for the syndications I’m doing now, it’s absolutely going to be key for part of our prospecting game. The second is news. I mean, the third is news. And that can be just anyone that you read about who’s also having those liquidity events or it’s that, you know, you see that somebody mentioned in the paper that’s with a small family office or something like that, clip the article out, you send it to them and say, Hey, I saw this, I thought it would be a value to you. I thought it was really great. I’m going to give you a call next week and talk and I’d love to hear about you know, what your what happened here. You know, whatever people like talking about this sort of thing. So if it’s cold calls, fantastic. If it’s direct mail, fantastic. But who’s that list? Because direct mail can get expensive, it could sometimes can be anywhere from 50 cents to $1 a mailing. And so you know, who are you going to be sending that to, you only want to send it to the real real prime top prospects, right. But maybe there are people who are just on your list that have gotten so cold people who you helped out a long time ago, but you think they still might recognize your name, maybe you start with direct mail, rather than cold call. So it all depends on how you feel about cold calling. So this is our this is our list of the steps for investors. Now, again, on just even this, I’m gonna send you a template, so you can fill it out, I really hope that everybody spends some time and fills these things out, because this is what is going to set you apart. This is going to get you investors if you put in the work, because it’s all there. And you’re taking this craziness of all this thing and all this information you’re getting, and now you’re compacting it and putting it into a system in order to see who’s there and make the whole thing work. Because when you have people coming in, through your funnel, if you decide to do an online funnel, you know, you can start allocating them to different lists, oh, this person is now in a met with or this person was on that my dream 100 list. And now I called them and now I’ve met with them. And hey, what do you know, they hired me and now you’re, you’re keeping track of who they are and where they on the list. You can keep track of oh, they’re now they start in in my eight by eight from week one. And now they’re in week two. And now they’re in week three, all the way till when they’re in week eight. Okay, now we’re coming in on modern and February, on into my 36 Touch program. And I’m tracking how this came. And I’m also tracking on where they came from. I mean, maybe they were a cold Facebook lead. Maybe they were a direct mail, person, you know, where did that person come from, so that you can do more of it. Maybe it was a referral. And so you need to make sure that you give that you really reward who it is on that referral, and then let them know how things are going. Oh, man, you referred Joe Smith to me, let me tell you, he’s such a great guy. I’ve met him I’ve had coffee with him. He’s already says he wants to invest in the in with us. We’re gonna do a really great job with him. Thank you so much for introducing me. Simple as that. So other ideas for contacting, for building out or for doing things with these people? So events, I wanted to talk about events.
Events are great places for marketing one to many. Now. I believe the webinar world is kind of slowing down that people are not watching as many webinars as they used to just because with COVID, we got inundated with so many webinars over and over. We still use webinars for altitude marketing. I don’t think I’m going to be using webinars for my for investment marketing, for my syndications. But I’m not entirely convinced because it also is a great way to market one to many and not have to be there all the time. So events, first thing to do is think about
who, and I don’t mean who’s coming, I mean, think about who is presenting. If it’s just you, that’s great. If it’s, if it’s someone else, okay, well identify who that person is, and start talking to them. As soon as you have any chance of doing it. Set the date. I am going under the assumption if you are in this program, that you are actually a human being, which means you may need a ticking clock in order to pressure you to get things done, just like the rest of us. If you’re not one of these people, then you probably aren’t human. And you don’t need a ticking clock. It’ll just You’ll get it done. Well, kudos to you. But set the date as quickly as possible. And then start thinking about well, okay, what’s the actual agenda going to be? Because you’re going to need to know this before you do anything else before you start inviting people, you got to know what you’re talking about. So am I going to be doing investing? In real estate? The first small business person I mentioned, invited him to an event. And it was one of these events, it was on investing in real estate. And he did end up investing. What did we talk about? We talked about the different kinds of real estate they can invest in single family homes. Apartments. This is just how we broke it out. Not the way I talked about it. But this is the I totally butchered the spelling, commercial. And then ultimately, what we really wanted from them was investing in syndications. This was this was the what we talked about, you know what the pros and cons of each one. But it’s not the only thing that you can present on, you could just do present on the market update. And how do you do that? The best way in the world to do market update is you find your wealth manager, and you partner with them. You get them to co sponsor the event with you. And they will talk very intelligently about market update. This is the best way to do it. They do a terrific job. And it takes all the pressure on you off you but you get all the kudos for it, which is great. So in return, they get to market themselves to a wide base. But they also will and this is outside of agenda. This is also a answers the question. But how do we feed them or give them booze? Because that definitely helps. So you’ll get more people if you have alcohol, and you’ll get more people if you have food. And many times your wealth managers will pay for that. Now, on who those wealth managers are, they are a strictly regulated industry. And so they need to be very careful. They want to sponsor an event where they’re not speaking or are the main speaker, but they will sponsor an event if they are the main speaker. And it’s very clear what you are, what your role is going to be. So just FYI. So that also goes under the category of figuring out who pays. And then lastly, you got to market it, you got to tell everybody, because not a lot of people are going to show up, it’s going to be a lot less than you think, even if you’re feeding them and buying them booze. So the if you’re not feeding them or buying them booze, then then very few people show up. If you do, people will show up, you’ll get a good turnout, especially if you’ve got a really great speaker. Sometimes the market update can be a really super, they have wealth managers oftentimes have people in their industry that are really, really great presenters and can do a terrific job. And so they may talk about the market themselves, they may bring in the tax guy to talk about, about how taxes are going to be for the next year. We’re kind of getting to the to the point and we’ve got a while. So we’ve got a few more months until that becomes a really hot topic again. But that will certainly be one or any other kind of local issues there. If there’s a public speaker, even if it’s not on point, they can be terrific to there. I mean, what you’re trying to do is you’re trying to get the butts in the seats. You’re trying to get people to show up. So this is a events, other things you can do
Is, is mailers, cold call coffee items like that. Now the last thing I want to talk about is part of show up like no one else.
And we do that through what we call, shock and awe. In this day and age, everybody is expecting to get an email and a PDF. And that’s it. And they’re not expecting to get anything physical and they’re not expecting to get anything real. But when they do, the shock and awe package can really make you stand out and make you show up like no one else. And what goes into a shock and awe. I mean, there’s a lot of great ideas that of what you can do. You know, I would definitely do some sort of letter, like typed out and then hand signed by you. I mean, we’ve you know, you’ve seen notepads and pens before. flyers. And that can be flyers about either it could be flyers about properties you’re working on, it could be flyers of past deals, or syndications that you’ve done it can be a it could be a flyer about why they should invest in syndications, things like that. Sometimes people use like gift cards.
You can actually get cards made at Starbucks that are personalized, I did this. I got these $15 Starbucks cards that are personalized, actually will show once. All right, so how’s this for reality? So I did this for my law practice. So in here, we’ve got a custom gift card. Right? It’s it’s got my logo on it. And then it says this was done right during COVID. So we couldn’t really meet. It says thanks. Well, normally we’d buy you a cup of coffee, it’s just hard to do that on the phone or on Zoom. So please accept this gift card is our way of saying we look forward to working with you. How do you think this shows up people were like stunned at how cool this was. I mean, it’s got it’s a Starbucks card with your logo. And you also get the kind of, Wow, these guys are big enough that they work with Starbucks, which is just an added like awesome benefit now that it cost more than just the than the value of the cart, because you’re paying for the printing of the envelope and you’re paying for the printing of the card. But you know, at the end of the day, it’s a very cool way, especially to push someone across the threshold. And if you’re putting together a shock and awe package, think about it, because it’s it’s pretty cool and very impressive when they get it. And it’s something that they’ll use and think about when when they see it. You know other people do pens and things like that. But I think the gift cards is probably the coolest thing we’ve done. The other thing that’s also great is books. Now, you’ve probably heard about some great book programs before where people I’ve identified they’re big whales, and they send a book a month to to their big whale and just with maybe a little note card put in you absolutely are going to be remembered. And it doesn’t need to be I mean, it’s certainly great if it’s a book you wrote. But it doesn’t need to be it can just be some other kind of book. I mean, books by Malcolm Gladwell are great or just anything that is that you think would really kind of meet your your community now I wouldn’t go I would not do anything political unless that you’re really just trying to reach investors who are bullied have certain political feelings one way or another I would not do religion I would not do any sort of comedy that is edgy. Boy, that’s comedy meets edgy together. But I think business, I think personal development Skrei anything like that Oh, is just works out really well. Or it could be, you know, on the on the market specifically if there’s a in so in my area right now there are books that are put out, I don’t think I have one in here. There are books that are put out just on our geographic areas. So it’s something like the history of the San Fernando Valley, which is a really cool thing to just get and send to somebody. And if they’re in this area, it’s like, Oh, that’s pretty cool. So that’s got all time photos and things like that. So that would be another book that if it was very local, that you were marketing to be totally appropriate to center. But do think about what your shock and awe package is going to look like now it’s gonna cost you money. But this money is going to come around. So these people are much more likely to invest with you. I mean, don’t you think that if you received this very cool set of things, especially a giftcard of $15 Law of Reciprocity says they are probably going to be thinking very highly of you, and may very well do it as well. And I would also think about doing a shock and awe package for your fishermen because this is how they can keep you top of mind and be confident that you’re going to appreciate the referrals that you give them. Wow, we went over a lot of topics today we went over fishermen and whales, referrals investors, the eight by a program the 36 touch program events, other things showing up like no one else in shock and awe. So this was a big call. I hope you found that video useful. My name is Tilden Moschetti. I am a syndication attorney with the Moschetti Syndication Law Group. If we can help you with your syndication or fun, all you have to do is give us a call set up a meeting and let’s talk about what you’re working on.