Ep 355 - 100% Ownership Passive Investor Ads - Beware!

Hey, everybody. Flipping Danny here, founders of the Freedom Real Estate Group family of companies, and welcome to another episode of our podcast.

Which is called Freedom through Passive Income.

That's right. I am full of energy this time, so I'm bouncing in my chair. Sorry, if you can't. Watching you, you're not, you're not seeing me bounce around on my chair. All right, so this one, this episode is called 100% ownership. Passive investor ads, beware.

Yeah, so I'm actually on my phone right now trying to find them because I was on Facebook last night and I saw these and I was like, what? And it scared me. I was like, seriously, like, they're doing this. So check this out. Ever wanted to own high value commercial real estate typically reserved for massive investment firms? I'm not going to name the company with done for you service, you can now own multi million dollar properties without having to share cash flow and tax benefits with partners. If you're ready to become the sole owner of a large commercial real estate without having to do any of the legwork, tap or click the link below to view our investor webinar. And then, yeah, it's a $500,000 minimum to be a part of this. So I saw that and I just was taken aback because they're, they're treating the ad like you would for a syndication or fund. Like what we do, right? Like be part, have, have part ownership in these, in these deals, you know, the way that it's structured. But they're, they're offering and saying, hey, you get 100% ownership. So people go, ooh, I, I own the whole thing. But what they're not telling you is essentially all they're doing is wholesaling you a commercial deal, right? It's just like what we do for wholesaling single family. Like if we find a property that doesn't fit our criteria, we go find, talk to an investor and go, hey, this isn't a deal that we want to buy, but if you're interested, we'll wholesale it to you. And if they like it, then we sell it to them for a small fee and we get a small fee. That's what these people are doing. They're finding properties and essentially wholesaling it to somebody else so that that somebody else has 100% ownership of it for a fee. And so I was thinking about that and I was like, man, there's going to be new investors that are going to be attracted to this. I get 100% ownership. Like, now I really feel protected when reality is you're the least protected because you're looking for this passive investment. And that's what they're trying to sell to you. And they're going to find this property, wholesale it to you, you're going to own it, and either they're going to be out of the picture and now it's up to you to manage it. And if you don't know how to manage it, well, that sucks. And, and if they do offer services, now they got a fee for giving you the property, now they're going to ask you for a fee for the services that they offer. Whether it be renovation or property management or whatever, asset management, whatever it might be, they're going to get that fee. But guess what? They have zero risk. They just wholesaled you a property, now they're getting, they got paid to give it to you, now they're getting paid for their services. And if anything goes wrong, who owns it? The investor.

Yeah, not them.

Yep, exactly right.

In Maui.

Yep, exactly right. And I thought about this and I was like, holy crap, this is going to be something in the future that is going to be a little scary for all the people that think this is a good thing and realize later it is the worst thing. Because what you want to do, if you're going to get into commercial property, that it's there, it's expensive and it's, there's a lot of pieces to navigate. There's a reason why we partner with so many people in this space. Right? In the single family space. We didn't need to partner with other people. You know, buy, sell, flip, rehab, whatever, that's easy. Yeah. But multifamily self storage like this commercial space, we partner with multiple people because there's so many things that you have to, to look at, you have to know, you have to have the knowledge, you have to have the money. That many times there's four or five different people that are partnered on a deal together. And how you do it in a syndication and fund is yes, if you have money, you can invest and be partial owner, but you're relying on that general partner team to do the work because they have the time, they have the knowledge, they have the skills, they have the boots on the ground. And many times the, at least with us, we're giving our investors who did provide money a preferred return. So our investors are getting paid before we even get paid. We're doing all the frickin work. Right. And so these guys are totally, and I'm not saying it's a bad company. I'm saying it's scary me seeing that and knowing how much knowledge we have to pour into our investors that don't understand this space, if that. I just. I feel like there's going to be investors that go in there not having no idea, thinking they're protected, and now they're. They're sunk because there's nobody in it with them. Right. Those guys aren't in it with them at all. You want to have people in it with you. You want them to own part of it, because when crap happens, their name's on the line, too. And their name should be the big one on the line, not you, the investor who just pointed up the money. Oh, scary, scary. So, anyways, I've gone off on a rant because when I saw that, I totally flipped out. I was like, oh, my gosh, here's another thing that. That investors are going to be like, I lost, and $500,000 is the minimum. Just. It's just scary. Anyways, I'll let you respond to it now, because I know I hadn't even shared it with you until just now. So you learned this right along with everybody else.

No, I know. You know, and I can easily see that they're there, you know, because you're like, well, who's going to spend 500,000? You know, there's people out there, there's doctors out there, and that. We know this now. Y. I. I would not have assumed this, you know, five years ago, but now we know this. There's doctors out there that have this kind of money, and, like, well, how hard could it be? You know?

Yep.

And then. And they jump into it, you know, and they. They. They burn that money and, and yeah, it's. It's, you know, because, like, like I said five years ago, like, nobody's going to do that now. Now that we've been, you know, talking to so many people and talking to people that have money but don't understand what they're doing.

Yes.

And. And that's why we're always. Exactly what you said. That's why we're always saying, we are going to hold your hand. And we. Because we are working with this person and this person and this person and this person and this person and this person, because they've done it all before. And we're gonna, you know, we're on a proven track. You know, this is just somebody saying, hey, I got this deal. You want it? You're 100 owner. Here you go.

Yep. Yep. And even the. The investors who have done Syndications in the past. They're gonna be like, I've done this before and it's been successful. Right. Why? Because they had a general partnership team taking care of the deal that owned it with them. But they're not going to always think that through. They're just going to go, now I get to be 100 owner and get all the tax benefits and get all of the cash flow, but oh, man, I'm in. They're just going to automatically think I'm in. This is. This is great. And they're not going to think of the downside. Sorry, that's my alarm for our next meeting. They're not going to think of the downside of, oh, oops. I'm the sole owner. I'm also the solely, sole, sole responsibility and my name's on the hook if things go bad. You know, and we've talked many times about a good investment can go bad if you have the wrong team, bad management, whatever. Um, so numbers can look great. You own it. You don't have the experience. You've got a bad team, it's all on you, and you're going to lose your butt.

And this also goes back to the other episode we talked about, the Weakest link.

Yes.

You know, you've got all these different parts, you know, that you're using to do the deal. If just one of those is a weak link.

That's right.

That's bring all of them down.

Yep, yep. So, anyways, I thought I would talk about it.

Yeah, we're incorporating all these other pod episodes.

Yeah, yeah, yeah, yeah. I just wanted to talk about it so that at least for the people who listen to this podcast, if they see the ad now, they're going to be asking a lot more questions and not be fooled into. Ooh, this is attractive.

Yeah. Well, as you can tell, Danny's alarm already went off, so we have another meeting to go to. So we hope you like this episode. Make sure you're heading on over to our website, freedomcapitalinvestments.com to join our investor club. We've got a lot of stuff going on, so make sure you're talking to Ben and or CJ to find out all that information. We're on all the social medias, but we'd like to end each and every podcast with Invest Smart, Live Happy. Bye, everybody.

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