How to find investors?

[Lenin Diaz]

i feel like i'm ready to step into the wholesaling world. i've listened to podcasts, taken courses, and acquired my contracts. The only problem that i'm running into is a lack of network, i've been trying to build, a sort of, catalog of investors and have tried tricks that i've heard through podcasts and what not but only to get the wrong results. all i've gotten was hard money lenders or nothing at all. 

[Jonathan Twombly]

@Lenin Diaz In my experience, networking with other real estate people (i.e., other investors) is important in building a network of fellow professionals, which you definitely need to do.  But if you want to build a network of investors, you won't find them amongst other people who are trying to do what you do.  It's simple - how much money are you going to find in a group of people who are all looking for money.  And, in such a group, if it's learned that someone has money to invest, that person will be swarmed.  Also, that person is going to gravitate naturally to the person in the group with the most experience in doing deals.  Starting out, you won't be that person.

Here's what I found works better, and my successful friends in real estate have employed similar strategies.  

First, sit down and think hard about what your goals are -- what kinds of real estate you want to invest in, where, at what price point, with what holding strategy, and what exit strategy.  

Second, write it all down in a professional-looking document you can give to people.  That document should also contain your bio and your contact information.  

Third, start talking to everyone you can about your real estate investment plans.  Slowly, as you do this, people will start to tell you they are interested in partnering with you.  

Fourth, start collecting those people's contact information and make a database of their names, contact information, and amount they are interested in investing.  You need to assemble "soft commitments" of 1.5 to 2x the amount of money you will need to take down a deal, because there are always people who will drop out, no matter how "into it" they seem when you talk with them.

Five, start looking for deals.  When you have one you want to do, bring it to the people on your list and then ask for money.   Remember, if you have not built the network first, it will be extremely hard to raise money, even if you have a great deal.

You need to be finding soft commitments and looking for deals at the same time, all the time.  And it's best if you can find a way to communicate with the people on your list while you are looking for deals, so they don't forget about you or do something else with the money.  Keep their appetites wet.  It could be a newsletter or a blog or whatever, but keep yourself top of mind.

This will take time.  There are no magic bullets in this business.  But if you nurture the network now, it will nurture you later.