Attention Spans and Fear

[Adam Schneider]

Stephen Covey says to seek first to understand, then to be understood.

When dealing with an investor (private money lender, rehabber, wholesaler, landlord), we need to understand what is motivating that person, but also what that person fears. AND, we need to frame the topic in a way that keeps the person's attention. For new investors, the fears are the unknown of being taken advantage of, of losing money, of making mistakes, of coming across as a novice...so, if you plan on doing business with these people, anticipate those fears and address them. It's okay to say something like, "Joe, you are probably worried about XYZ if we do this deal, aren't you?" Or, "Most people just getting started want to make sure that ABC won't happen to them--are you worried about that?" By addressing the probable elephant in the room, the investor will appreciate your candor and will then allow you to discuss the risks and more detail about how things operate. 

  For example if dealing with a new private money lender who is worried about me defaulting, I might say: "First, Charlie, if that's a serious concern, you shouldn't do this deal. Why are you concerned about it--is it me or is it the property?".  Then, I'd explain that I purchase at deep discounts, so there is equity to minimize the default risk, and I'd explain that the lender has a Deed of Trust, just like a bank carries a mortgage." If after explaining all of that, the person is hesitant, I'll recommend that we DON"T do the deal -- not try to persuade him it's a good deal.

All of these conversations need to be done in a way that keeps the person's attention. A 50 screen-shot powerpoint presentation is very powerful at one thing--putting me to sleep. If you can't present who you are, what problem you solve, and how you solve it in an intriguing way in less than 15 minutes that creates intrigue, you need to adjust how you present. Here's an example of an opening line I might provide to a rehabber looking to buy properties from a wholesaler: "For the Fix and Flip investor who is dissatisfied with the ability to efficiently purchase discounted homes through auctions and MLS, and who wants to minimize haggle situations when buying a property, our company is presenting a new solution (XYZ). We are now offering the following forum...the reason this is the right time for this new forum is because of these key market shifts...we are unlike our competitors because...

  The above paragraph is oversimplified. The point is to be able to succinctly pitch who you are. Sometimes, the less you talk, the more the other person hears!