Finding private money relies on the same techniques and principles that you use to find good real estate deals. If somebody asked you where the good deals were in this market, you might tell them “everywhere! You could go here, there, insert place .
To find good deals, consistently, you need a solid, proven multi-step marketing plan.
It might look like this:
- Meet local real estate “players”
- Build relationship with buyers agents & listing agents
- Follow up continually and let these players know how working with you will be good for them
- Send postcards or letters to motivated sellers of properties identified from public record search or lead generation advertising
- Follow up consistently with direct marketing to sellers
- Set bandit signs out on weekends to generate leads to find buyers
What you would do if you wanted a continual flow of deals is you would implement a system that would cast as wide a net as possible. If you really wanted to eat and had the option of fishing with a bamboo pole, string, and worm versus a huge net that could drag the entire lake, which would you choose?
I hope you said the net. Because that’s what it takes to generate private money – so much private money that you won’t ever have to worry about how you’re going to close a deal ever again. You won’t have to worry about coming up with the equity to buy a large commercial building. There are a lot of ways to ‘blow it’ with private money
And, the first and biggest way you can blow it is to never give yourself the chance to raise any. If you rely solely on posting your deals up on internet websites and praying for a response; if you rely solely on talking to a few people at a networking group; if you rely solely on putting up a website (which probably doesn’t have the right response mechanisms in place); if you think Face book is your private money getting savior, well then… You’re gonna be very disappointed.
Maybe you’ll get lucky (hey, it’s better to be lucky then good sometimes). But, it will be tough to make this work for you on a consistent basis. It would be akin to opening up a pizza restaurant and then saying the only way that you were going to rely on getting customers is with radio advertising.
Not a good idea.
In your quest for the ‘one’ silver bullet solution to getting private money, you should really think about fishing with a net and maybe some dynamite instead of just a bamboo pole and a string.
Think of private money the same way you do real estate investment deals and you’ll be pleased with the results.