$50K and a Business Plan

[Brennan Davis]

What’s up everyone, I hope the new decade has you all fired up with a wave of new possibilities!

So here’s the deal,

I just graduated and have a simple day job making around 45k a year, with no personal expenses for the next 6months (Thanks Mom and Dad—Very Fortunate), and most of all: No prior experience in RE other than books, mentors and podcasts.

With this advantage, I have convinced my grandfather and his brother (Both commercial RE investors) to form an LLC with me and invest 50K into a real estate investment of my choice IF I can propose a SOLID BUSINESS PLAN OF ACTION. My question is:

-What to include in my plan

-How to incentivize them

-Where to start gathering numbers and USEFUL data

This is where I am currently:

Capital: $50K

Market: Louisville, KY

Type of property investment: Multifamily 3+ Units

The overall goal in this plan I’m presenting is to start a foundation of equity that will lead to the ability to refinance these propertie(s) and be on track to grow at a multiple rate (Y1=1, Y2=2, Y3=4, Y4=8, etc)

Any help is greatly appreciated, and I will be happy to fill in any missing pieces to this puzzle

[Alexander Felice]

Writing a business plan is a VERY useful exercise and undervalued on this site (in my experience) so I'm glad to see someone mentioning it. Maybe I'm bias because in lending we have to do one for every loan.

Your plan will vary based on the audience obviously, but here's a jist to start with:

What you're trying to accomplish (summary)

Who you are (sell your management skills)

detail of the business model in question (location, financials)

SWOT (strengths, weaknesses, opportunities, threats)

risk mitigation (every "what-if" you can think of and the plan to correct, exit strategies, etc)

Where your partners fit in 

organization structure (who owns what, outlay where everyone's risk is spread)

This is obviously not complete, but should get you started. Writing out your plan and selling it to people is a tremendous skill set and something you'll improve with over time. 

I have plenty of examples I would be willing to share, or help go over your drafts if needed.