All Forum Posts by: Bryan Hancock

I spoke with their investor relations person on the phone after Ken Harris recommended them.  They seem knowledgeable, but I get the sense they're growing too fast.  It's also hard to tell who is good at underwriting and who is just lucky in the current environment we have.  

BTW....the investor relations guy never followed up with me like he claimed he would.  They're out-manned right now.  

VC is largely done the same way from what I have seen, but admittedly my experience there is limited.  I really dislike the typical VC construct and feel like it is optimized for the benefit of the VC's entity sponsors and not for either their LPs or company founders.  Changes from new rulings on The JOBS Act under Title III are likely to materially alter the financing landscape at least through Series A rounds.  There is still a large stigma from unclean cap tables and how it impacts later-stage financing so the amount of capital required for any particular business model matters a lot too.  

Austin's culture and climate are really biased toward growing more out of profits and conservatism, which I would also argue are more founder friendly for slicing the pie.  They're also arguably more lifestyle friendly for founders, which is often a pejorative in angel circles.  This has always amused me.  

2020 has forced people to operate in different ways and has accelerated the learning curve for new methods of communication, but financing is still driven largely by perception for those writing larger checks for the companies that will end up on Tech Crunch and the rainbow chasers.  Some of the best deals are small M&A deals though and those outnumber the headline-grabbing IPO deals by many multiples.  I'm very fond of sponsor-centric projects and alignment around solving actual problems instead of optimizing for early exits, but I recognize those who have amassed a lot of wealth thinking about the world in a different fashion and demanding that founders move to their back yard.  Keep in mind that capital is fungible though so the demand from founders will attract the capital to the Austin MSA at some point.  We're just not on the same par as the other larger submarkets right now.  This will certainly change though with the population expected to double here in short order.  

Austin does a great job starting things, but the capital formation process here is still much tougher than it is in the major tech markets.  That will likely change because the money will follow to the good deal flow, but Austin still has a long way to go to rival Boston, SV, or other major tech centers for the whole ecosystem.  As more exits occur and reseed new investment things will change, but we're still lagging other areas viewed holistically.  

I have a 260-unit development going in Manor, which is relatively close to this.  We're also still doing deals in 78702 which we have been doing since 2010 before it was cool to do it ;-)

If any brokers or folks on this thread have new projects or would like to chat about opportunities we're buying!

The types of workers that Austin is seeking really can do their work from nearby locales or other cities.  Employers are a lot more receptive to just using Zoom or Webex for workers now so I think this data is less relevant than it used to be, but Austin is certainly still booming.  I drove by the site for the new basketball stadium yesterday and could count 12 cranes within a half mile radius.  It's nuts.  Apple's campus in northern Austin has 5 or 6 cranes all by itself and is a billion dollar development.  Even nearby cities like Leander are starting new giant developments.  

It's a good time to be a developer or investor in the greater Austin MSA.  

Pretty much all of the developers in my circle would gladly build denser product to give the city what they want if the development code was changed.  Simply changing the rules on the compatibility setbacks would help a ton with many, many sites.  

I wouldn't count on anything changing with the political climate that they currently have though.  Unfortunately the craziness is infecting Williamson County now.  

Development varies quite a bit based on your locale.  Each city has different rules and processes, but the major portions are likely to be similar.  This site really caters more to new investors and development from raw land really isn't a great starting point for new sponsors.  

The City of Austin really needs to modify their land development code and increase density along with to change the requirements on compatibility and the setbacks.  Until the neighborhood plans that have a stranglehold on the city are defeated this trend will continue.  The buyers who are working at Google don't really worry too much about another 10% bump in prices.

After sitting 3 years out I am about to start putting some Austin MSA-based inventory in the pipeline next week.  We organized our capital to start bidding on new projects and will start placing units in 2021.  

The marketplaces for crowdfunding for real estate are highly selective for a reason.  They're catering to the investors on the site.  That's great if your deal type matches or if you already have the track record.  What happens if neither of these conditions apply?  

Learn to market on your own and stand up your own site.  Learning to raise and organize money is one of the highest payoff activities in the industry and you can start other business interests once you learn to do so.  Outsourcing a core part of your business really isn't going to fit very well long-term for a sponsor.  Design the marketing systems you need and do it correctly on your own.  There are folks to help with this if you look around.  

This is LOOOOONG overdue.  It's simply going to legalize what has been happening in the industry for many years.  Paying for introductions and not for placing capital is exactly what a finder should do so make sure your finders sign something and understand that this is their role.