Raiseing Capital For Multifamily Deals LIve

Guys, welcome back. It's Multifamily Strategy. I'm Christian, your channel host. I am excited for today. I'm talking about the thing that everyone always wants me to talk about— raising private capital. You guys always want me to cover raising money. Where's the money come from for deals? How do we do it? I'm gonna go— I'm gonna show you exactly how we actually do it and some cool new ways that I've been doing it, uh, recently that I think are gonna be really, really helpful. So have I talked about this before? Yes. Have I shared what I'm gonna share today? No. So if you're watching this Uh, stay tuned because I'm going to show you a couple new ways that we're doing to raise even more capital. Uh, for context, if you're brand new to this, uh, I own a little over 600 units. I own a resort, uh, multiple companies, many of which I purchased with creative finance. In fact, of the rentals, about 70% have involved creative real estate tactics. Uh, I never have the money to close on the deal because right now I'm buying an $11.9 million deal, which I just checked. I don't have that money sitting under my desk right now. Uh, which means we gotta go out and find it. Uh, so I will share the model, which I think many of you are familiar with, of deal debt equity, but I'm gonna get deeper into this of what are the actual tactics that you will follow to make the money appear for creative real estate deals. So excited to see everyone here. Let's dive straight on in. Uh, if you're not aware, we're under contract for a 200-unit and an 80-unit right now. We just put offers out on a 105-unit and a 234-unit in Texas. My current liquidity, because I just bought 224 units this year, is a few hundred thousand dollars. That doesn't buy that because we're buying like $25 million of real estate, potentially more. So how do we actually put this together? Why would we do this? And how does it always look the same as it did when I started? Because if you're doing this for the first time, is it the same as when you're doing it for the 32nd time? I'll just skip to the answer to that. The answer is yes. I will not put you in suspense. The suspense piece, I'm gonna share the newest thing we're doing that is working so much better than some of the old ways I used to raise capital. So we raised about $10 million this year for deals. We're gonna be raising a lot, lot more, not including the actual money from the bank. That's just through private investment. I'm gonna start with the fundamental. Don't just skip this live because I— you hear me say this every single Deal, debt, equity. I'm going to say it, and then I'm going to get into the tacticals. So just bear with me. Deal, debt, equity. If you're watching this for the first time, you find a deal first, then you find the most appropriate debt product. Could be conventional, could be the existing lender, could be seller financed. It could be a blend of both. It could be a DSCR loan, a private note, a private bank, a credit union. There's all these different options for people who want to give money to good deals. But what do they want to give money for? Good deals. If you don't have a good deal, don't waste their time. Also, California Wine Guide, hello from Texas. Um, we've actually— one of my friends just did a 28-unit in California that was absolutely awesome. San Diego area. Um, there are some, uh, even on the states that are notoriously hard to do this in, uh, this process works. He actually did a pretty decent capital raise to knock out that deal. Uh, so I'm gonna share these exact tactics, uh, even the ones that he used for that deal. So Californians, This works for you too. Texas, California, red states, blue states, big cities, small cities, works universally. But it always goes in the order deal, debt, equity. Create an opportunity that makes money. Take that to different lenders. Figure out what debt product makes sense. When you have that, you now know 2 things. You know how much cash flow you have, and you know how much upside you are anticipating to conservatively get, which is, uh, all the money that is available on the deal. If you know how much it is going to be worth, that means you know how much you can potentially pull out of it. And if you know how much cash flow, you know how much you get paid along the way. This is your total pool of money that's now available to reward people. If you try to raise capital before you have these pieces, you have no idea how much money or how the money wants to be given to them. High cash flow, high monthly payments, higher preferred returns. If you have lower cash flow, you're not going to give them a bunch of cash flow. You're going to give them more of the upside in the future, a little more equity, and you're going to see, okay, the end of this project, the payout is going to be a larger lump sum. You don't know what your money looks like if you don't have a deal. And you don't worry about raising capital if you don't have a debt product, because you don't know how much capital you're raising or what it needs to look like. The deal and the debt will tell you what the money needs to look like. That is the number one thing that took me 8 years in my career to learn. I've shared this on the channel before. If you guys have been around for a while, you already know this. By the way, you're welcome to ask questions. Uh, uh, you guys are welcome to ask questions, uh, in the chat as well. Uh, so I'll, I'll I'll throw those up as they come in. But a comment here. Just listened to my book, learned a lot. I'm very happy. I tried to write the most practical book of all time on creative real estate. Literally only— I only taught concepts that we've done, and every chapter ends with, here's the thing, here's when we used it, here's the next concept, here's a creative clause, the stair-step method, the free-for-everyone method. Here's what it is, here's how you apply it, and here's an actual deal where we actually did it. That's the whole point of the book. So I'm glad that you enjoyed it. I wrote it to be practical. I got so frustrated when I read Rich Dad Poor Dad, which I read late in the game, by the way. I did. I started on Dave Ramsey and had to— I did the entrepreneur thing first, then read Rich Dad Poor Dad. I did it all backwards. My problem with Rich Dad Poor Dad, great concepts. There's no execution in that book. It doesn't say how to build the business. It just says like, hey, cash flow good, business is good, make your money, earn money. Great concepts. It does not say how. I wrote a book that says if you want to do real estate, you want to do multifamily, Here's the concepts and here's how you execute it. So I'm glad that was appreciated. Here's how you execute on raising capital, which is why you're here. First of all, I've been coaching for 5 years. Multifamily strategy has been around for a while. What I found in over 90% of cases, people do their first and second capital raise up to $1 million. The people are already in your phone book, or they're people that those people know. And I am— I have had some very, very broke mentees. who come into the program. They do. They don't have a lot of cash. They don't have a lot of income, but they also don't have any relationships that are worth anything on paper. They call through. Everyone knows someone within 2 degrees of separation from you. Your first capital raises are already in your phone. You need to work on the deal and the debt before you worry about that piece. You will raise capital. 5 years, we've never seen a failed capital raise ever. Why is that specifically? Because Deal debt equity actually works. You need to put deal and debt together. People know enough people. If you have ever talked to anyone or you've ever been related to anyone, they also know people. 2 degrees of separation. Your money is already there for your first and second deal. That being said, you probably want to know more ways if you're still wondering like, well, what if that doesn't work? Or what if he's wrong? Or I don't think I have the network. First of all, you're wrong. You do have the network, but Let's pretend you don't. Rules of capital raising. You cannot openly market for people to just be a capital partner in a deal. If you're going to raise as a joint venture, they have to be an active member, but their activity can be very limited. They can be approving budgets and do quarterly meetings with meeting minutes. It can be relatively mundane. They just have to be an active partner. So if I'm looking for active partners and I'm not allowed to openly solicit saying, hello, I am an investor, uh, I have a deal, I'm looking for money. I have found the most easy— the easiest way to do this by far: host an event talking about your deal and market it to areas of the internet that also like those type of deals. Local real estate groups, Facebook pages, communities. You can join the Multifamily Strategy School community if you're not a mentee. You can join the actual community for like a dollar. Check it out. Post the deal there. Host an event on Eventbrite. Then just talk about your deal and how you're planning on structuring the deal, the debt and the equity. You can leave your contact for people to reach out to you. Here's what I found. People who do this for the first time, uh, my friend David just did this. He raised like $300,000 for a deal that wasn't even under contract yet. You can absolutely do this. Uh, just don't offer a specific return and don't specifically ask like, hello, we're hosting this to raise capital. Tell them about the deal. Tell them what you're working on. If people are interested, you can tell them the stage you're on. I'm at the stage where we're trying to put together the team for capital partners. And if you have additional questions or you want to learn more about the deal, go ahead and give me a call. What you're avoiding doing is creating a security. You don't want the IRS to look at what you said and go, they told them that they will— they are looking for an investor and they are offering them a 21% IRR, or they are offering them a 6% preferred return. Do not put specific preferred returns or promises in this presentation. Explain the deal and explain your deal structure. You can explain how you plan to give X amount of preferred return to investors. Do not tell people, if you partner with me, I will give this to you. It's a fine line, but that is the line that you're walking. As a general rule of thumb, if you already know people, you can partner with them freely. So if you have any existing relationship, you can do it. If you don't know the people at all, get to know them a little bit, have a back and forth. Communicate with them on more than, I would say, 3 forms of communication. Like, talk to them on the phone, email. They registered for the webinar, so you should have a video recording of like, hey, we've talked, we've met. We didn't just run into each other out of nowhere. I did a presentation on real estate. We started talking real estate. We ended up partnering. That is a normal allowed thing to do. That's the most common way for most people to get started. If you have a larger deal, which is what I have here with the 200-unit we're closing right now, $3 million raise. I don't have a small pool of investors who are like, hey, we have 300 ready to go right now. Actually, that's not true. I do, but they're not deploying their capital until next January. So I need to close this in like 15 days. You can do a syndication. You can market on a 506 only people that, you know, have an existing relationship with. Can't openly market. 506, you can openly market to the world. You can literally say, This deal is projected to make 21%. Our math is available. But the trick to this, I used to reach out to people one-on-one or in really small groups. I started doing this as a webinar style recently. In fact, I can share, I'll share a little bit of this webinar with you guys. I have it up on another screen. Let me pull this up. I was working on this a little earlier and gave this presentation a week ago. So let me kind of cut to the middle of it. I'd love to show you what this actually looks like. I haven't done screen share, by the way, while streaming in a long time, so, you know, forgive me if I'm a little rusty on how to do this. Uh, but let's go share screen, and I'm just gonna go to entire screen. Epic. All right, so I'm doing this deal here. Maverick and Gilmore start with some awesome pictures. And start rolling through from there. We'll see how fast it goes while I'm actually streaming. But this is basically what it looks like. I actually go through the first— I do like 50 slides, and I put what I wanted to do, and ChatGPT filled it out for me. So a lot of these images, this, this was made over the course of about 30 minutes. I wrote out, this is what I wanna present, and then I edited it, added my own thing. It's about an hour of work to go into the entire thing. I talk about the actual reason this deal came up. Now, the deal that we're doing, uh, the partnership was not working. And so they're selling for about what they owe on it, uh, so that the bank doesn't foreclose on it. The bank is willing to transfer that note to someone else who is an established operator with a business plan they like. We came in with a business plan that the bank likes. So we're buying this for 5.5% down because of our operational abilities in the area, in tertiary markets of Texas. We basically built ourselves in a way where we are the most obvious buyer. Now, I won't bore you with 55 slides of stuff. What I will do is apparently zoom into 500% because I'm a weirdo. Uh, no, let's do this. Uh, there's the thing I was trying to drag. I'm gonna go to slide 55, which is where we stop talking about the problem and we get into the main part for me, the property itself. When you are pitching for capital, you are trying to do 3 things. One, do not lose their money. That is more important to investors than making money, is they place their money and that they don't lose it. That's more— most important to me. That's most important to them. That is what matters. I want to talk about the deal itself before I get into the returns. What is it that I am investing in? People must understand, one, what they're investing in, two, why the money is actually safe, and then three, and least importantly— still important, but least importantly— what the actual returns on. Or are, if they're excited about the project and it's the type of deal they want to do. Most important, that is what people— you want the people to want to invest in the deal before you share anything about the finances. What is the project? Is it exciting? Major, major point. 2, why are we not going to lose the money? 3, what does the actual return look like? By the time you get to the return, They should be asking themselves in their head or saying to themselves in their head, I hope that these returns are awesome because I love this project and I really want to be a part of it. That is where they should be before you give them any numbers. They should be hoping, please let this be the deal I invest in, which I feel like is a lot of people when I actually go through this project. So I did a couple of drone photos on this. I go through the actual project. We're replacing all of these decks, 200 of these bad boys. Uh, so this will look brand spanking new. Signage, $11.9 million purchase, $59,000 store. $60K a door in Texas is insane. I go through the opportunity, why the opportunity exists specifically. I talk about the market, Longview, Texas. We talk about— we looked at almost 50 other deals before we selected this one. Which to me is a sign of stability because we said no so many times until we found the deal that was just excellent. And then what does it actually look like? That is the actual pool deck. I have a little better picture of it in here, but let people feel what the project is. It's a Class C+ building that should be a B in a B+ area. It's a good area. The amenities are there. This is a live shot taken from the pool. Looks beautiful. This is inside the clubhouse next to the pool. We have amenities, we have dog park, we have a beautiful office, beautiful pool deck, sprawling campus, 200 units. It's a really big deal for a really low price. Being able to put together something like this for your investors to fall in love with the asset with you— what are we buying? And then we get into the numbers. Again, I'm not, I'm not actually pitching this or going through 122 slides, but what I want you to see is this is what I like putting together. Run it instead of as a quick event, run it as a webinar. Invite everyone to it. When I did this, we had 130 people show up. Of that, all the capital is committed. Not everyone could do it fast enough because this is a 25-day turn. So we're actually still finishing out the raise for this, and it is a 506, so I can market it with returns. Um, that being said, if you're interested, you can reach out to, uh, you can reach out to my team. Um, I'll drop a link in this video description when it posts on YouTube. Um, I'll drop a link where you guys can actually book a call, uh, with the team if you guys would like to invest in this. It's a minimum investment of $50,000, uh, though ideally $100K. Um, and it's for accredited investors only. It's a 506, which means we cannot work with unaccredited investors. So if your net worth is currently less than a million outside the value of your house, Or you make less than $200,000 a year. Nothing wrong with that. Just doesn't work for this deal. I do deals that are for unaccredited investors. This just doesn't happen to be one of them. If you happen to be unaccredited, but you're interested in opportunities like this, let us know. I'm happy to get to know you. I can't work with you if I don't get to know you. So either way, you guys are invited to this, but that's how you do it. You get out in the world and you talk about the deal exactly like I'm doing right here, but I do it in an organized fashion. I'll go through this entire webinar. This webinar strategy allows us to eliminate people who weren't gonna be buyers in the first place without taking a million meetings. What I used to do is a million one-on-ones. It wasn't really a million, but it was like multiple one-on-ones a day for 30 to 60 days, just hours upon hours upon hours of raising capital. It worked. We raised tens of millions of dollars. It was a grind. The webinar strategy, this has been the easiest it's ever been. One well-thought-out presentation. After that, if they are interested, they can book a call with you, or if you have other members of your team, with you and your team. Get together, build the team of investors that you want to work with. You cast a wider net, which means you get more selection, which I love. You also don't have to do the same presentation like 40,000 times. So hopping back to the Christian view. Hello, welcome back. That's, that's what we do. That's, this is how I have found is the most effective way to structure it. Again, I share everything that I do online. I love going through what we're learning. I never found another YouTube channel or course or community that just shares everything in real time as they do it. Uh, it's why I wrote the book. It's why I started Multifamily Strategy. If you're looking for actual coaching in a community, you guys can check out multifamilystrategy.com. Absolutely book a call for my team. We literally will not let you join Multifamily Strategy if you are not a good fit for the program. If you're looking for coaching, we offer that. If you're looking for education and information, you found the right YouTube channel. This is, this is where we share this. Subscribe to this. I share new things every day on creative finance, creative contracts. negotiation, finding deals, funding deals, building your team, property management, uh, the business— we talk about it on this channel. And there's some awesome announcements coming out for this channel, so, uh, stay tuned because we're about to get a whole lot more epic. Last announcement I have for everyone before I go today, uh, next few videos that you see for full-length videos on the channel, uh, the Robinhood event— I've selected some of the series that we did for the Robinhood event up in Washington, some of the hour-long presentations with some of our best guest speakers, some of the actual speeches that I gave. We've selected a handful of them that we're going to release to you, the public. So I have those in editing right now. They will be coming out over the next few weeks. Stay tuned for those. I built an entire structure over 2 days of an event going over beginning to end the entire process. I'm going to release some of my favorite pieces of that for free here on YouTube. So you guys are more than welcome to Check that out. I hope you get a ton from it. It was received really, really well at the event. So I want to share that. And it's at the Robin Hood Village Resort, which is the resort that I bought seller financed. So you guys can see what it looks like learning about how to do this at a property that we learned these strategies at. So appreciate you guys. Love, love, love seeing you guys. A bunch of awesome stuff coming in for this channel. So do the thing, like, subscribe, comment to the video, you know, and make sure other people actually see this darn thing. I appreciate you, and I'll see you all in the next episode.