Raising capital

[Adam Yunker]

Hey guys! I had a general business related question that goes for all types of businesses, real estate, commerce, e-commerce, etc.

My question is about raising capital & I'm sure we all heard the phrase "You need a great team!" Or "Business is a team sport."

I realize investors really invest in the team behind the project, but how are you suppose to get a team without the capital to pay for them? And how are you suppose to show investors your A+ team if you work with a great Attorney that has 100's of other people to work on, or your amazing property manager, or website designer? If they don't have any equity in your company?

I realize this question is more business focused, but real estate is a business! And you need a great team to win :)

I'm just wondering if there are some members that may have the same question I have, or maybe some people that know the answer!

~Anyways guys & gals, thanks for supporting the awesome community we've got going on here & let's keep it up!

[Annie Dickerson]

This is an excellent chicken-and-egg question. How do you get investors/capital without a deal/team, and how do you get a deal/team without investors/capital?

The key is to start with the investors. Start by having organic conversations with people you know. Tell them what you're doing in real estate and the successes you're seeing. Teach them what you know. 

If you don't have a deal, you can share with them a sample deal. Prepare a short document or slide deck showing photos, numbers, and information for a fictional deal. Tell them that you don't have a live deal for them to invest in, but that when you do, it'll look something like this.

The sample deal will help potential investors grasp what an investment with you would entail. As for the team, you can explain that you'll only partner with experienced teams and operators, and that you're actively looking for the best partners.

Through this, investors will start to see you as a leader, and some will express interest in investing alongside you, which will help you get started in raising capital.