just 2%

Last month Pine Financial Group hosted the 2020 Minnesota Real Estate Investor Success Summit, it was an amazing event and we had the best participation yet with over 215 registrants! I got the chance to film the action, which is always fun because deep down I think I’m a comedian. Ask my wife and she’ll tell you there’s nothing a wanna-be comedian loves more than a new crowd! I thoroughly enjoy the opportunity to be in front of a crowd and provide the tools to grow their business. At the pinnacle of success, I was particularly elated and offered anyone present the opportunity to schedule a call with me to help provide some guidance or feedback on their current strategy or goals. Over 10 years of investing in real estate, I have been fortunate to be involved in thousands of deals as a lender, developer, owner, agent, flipper, etc. A founding investor was in the room that day, but I was the only one with a mic presenting the opportunity. This is where the 2% comes into play, I’ve only had four people accept me on the offer. This may be evidence of my poor ability to “sell” the service, or I suspect it is an indication of the difference between the 2% and 98% of people who attend real estate investing events.

The guys in the office often have a hard time saying their “go-to” for events we host, “Why are you here today?” Sure we laugh a bit, but I really mean it, people who identify themselves as investors give up their evenings, weekends, spare moments, and oftentimes money to attend classes, seminars, and webinars on the elusive topic that is real estate investing. That is why I ask the question: “Why are you here today?”

So what does it take to be 2% versus 98%? One of the many things I love about real estate investing is that almost anyone can do it. It depends on your skill and resources, or your ability to utilize the skills and resources of others, but what is non-negotiable is desire. This desire is created by an individual’s vision, often referred to as the “big cause” and the beauty of it is that it varies from person to person! One person’s goal for attending an event might be simply to buy a home to live in, while others might be on their way by raising $100 million in multi-family investments. Most of them are somewhere between looking to supplement or replace their current income with an investment. The ability to implement the individual plan is due to the “why” people go to the reason “to my family”, “to quit my job,” “to be rich.” Let’s just analyze the family’s answer, because in order to attend all these events, the attendees have to spend some time away from their family. If the goal of investing in real estate is to help their families –

Is it to create extra income to cover an event, such as college or a wedding?

  • Is it to provide the income that would allow the family to have a nicer home, and better schools?

  • Is it to supplement the income so that the husband can stay at home or reduce the hours spent with the family?

  • Is it to replace the income so that you are more willing to be with your family?

Once you identify the real cause, you can reverse engineer what it takes to hit the target, number of flips, rents, wholesale deals, etc. This is a relatively simple process; However, in all my time with real estate investors, I’ve found that it’s a lack of vision that leads to aimlessly attending event after event, hoping to achieve the theme that was presented last until the next bright object appears.

My four phone calls to those who benefited had a common theme, they just needed to hear from someone else. It’s amazing how an objective third party opinion can bring a plan into the future so quickly. Two were trying to figure out how to get into small 20- to 50-unit multi-family properties, but both needed to take some very specific (though not obvious) steps to make that a reality. The other two just needed to structure a small rental portfolio to provide enough monthly cash flow so that they could retire more comfortably.

2020 is in full swing, before you spend another evening or weekend away from your loved ones or pay to attend a “life changing” event, I challenge us all to slow down and define “why we are here today”.

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