5 Steps You Need To Take To Find Money For The Deal

Hey, it's Mark Podolski, the land geek with your favorite niche real estate website, www.thelandgeek.com. and I'm really excited for today's guest because he's gonna help us find that one little commodity, that one little resource that everybody wants, everybody needs to get your deals done. But before we talk to our guest, I'd be remiss if I didn't properly introduce my co host. You know you love him, the brain, the professor, your land geek flight school sherpa. Scott Todd from scotttodd.net landmodo.com if you're not automating your Craigslist and your Facebook postings, posting domination.com thelandgeek and if you want to learn how to do just about anything, technologically speaking, check out investor ninjas.com Scott Todd, how are you?

I'm good, Mark.

How are you?

I'm great. I'm great. Just a quick little announcement. Today's podcast is sponsored by Flight School Live. Want to learn how to start creating a deal machine and create passive income without renters, rehabs, renovations, or rodents? Get her done in three days. Live with the best in the business. It'd be like saying, hey, in three days, can LeBron James teach me how to shoot a jump shot? Can Tiger woods teach me how to swing a club? Get ER done in three days. Learn more at thelandgeek.com training so today's guest is Dave Dubois, and I'm just going to give a really short and sweet bio on Dave Dubeau. He's an expert in finding money for your deals. Dave DeBeau, welcome to the podcast.

Hey, Mark, great to be here. And I am absolutely astounded at your memory, my friend. Those are a lot of websites to roll off the top of your tongue, so well done, my friend.

Thank you. Thank you. I appreciate it. Ginkgo biloba combined with coffee. That'll get her done. So, Dave, tell us about what you do and why you do it.

Well, thanks a lot, Mark. I am a marketer and a real estate entrepreneur as well. My main focus these days is on helping other real estate entrepreneurs to attract investors and raise capital for their real estate deals. And that's something that I see is kind of the big stumbling block for a lot of people. I've seen all sorts of statistics, but basically it's kind of the 8020 rule. 80% of real estate entrepreneurs get stuck with two or three deals under their belt. They run out of cash, they run out of credit, and they can't move Further, because they're tapped out. Right. So we help those folks tap into their existing sphere of influence and raise capital the right way.

So I can imagine someone listening to this and thinking, well, he could probably help Mark or Scott because they've got good credit and they've got a lot of assets and they've got capital and they've got track record. But I'm new. Is there anyone, Dave, that you literally can't help?

Yeah. You know what? It is a little bit difficult to help people that are absolute beginners that haven't done a single deal before. That's very, very difficult to do. So it works best if you do have a bit of a track record and you know what the heck you're doing. I mean, it's just kind of common sense. So if you're starting from scratch, if you haven't done a deal before, then you need to get a deal or two under your belt and. Or do a deal or two by helping somebody else who's more experienced and then create a bit of a track record that way.

What about their credit rating? How does that need to be?

Credit rating doesn't really, really matter too much. Depends on what kind of deals that you're doing and how you structure it. But basically, if you don't have it, somebody else does. That's right, yeah.

All right, Tyler, what are your thoughts just initially?

Well, initially it sounds good. I'd love to know more about the process that we go through to get this done.

Perfect. So probably the best way to explain it is to show you what not to do, which is the way I got started. And they say a smart person learns from their own mistakes. A wise person learns from the mistakes of others. So I suggest that your watchers, your viewers, and your listeners be wise, learn from my mistakes. So the way I got into real estate investing is, you know, initially I did the whole Ron LeGrand style stuff. No money low, money down type deals, creative type deals. That was fun. I didn't really require much capital or investors, and I didn't have my head around the whole thing. Took a few years off, focuses on something different. Got back into real estate in 2010, and at that time I was focusing on tenant first or client first, rent to own deals. So we would find a good qualified tenant buyer and we would buy them a house and then we would rent to own them that property over the next two to three years. So, like most people, I self financed my first couple of deals and then I hit the wall, ran out of cash and credit And I remembered very, very vividly. I had the perfect tenant buyer ready to go. They were lovely couple. We went house shopping for them, looked at a couple of different houses, made a couple of different offers, that kind of stuff, finally got one tied up that they really liked. There's only one little challenge. I needed to come up with $85,000 for the down payment, closing cost, property transfer fees, etc. And I had two weeks to do it. And I don't know if you guys have heard. Have you heard the saying, just find a good deal and the money will find you? Have you ever heard that?

All the time. Yeah.

Yeah. Well, I found that saying to be complete horse hooey in my situation, because I think that works well if you've got a group of prospective investors already lined up kind of in the wings, ready to go, which I didn't have. So I was starting from scratch. So I heard, you know, all the typical advice about raising capital, pick up the phone and start dialing for dollars. Right. Cold calling. Have you guys heard that one? Yep.

Yes.

Evidently I suck at cold calling because I called and I called and I called and I got rejected and rejected and rejected and rejected. And I did that for a bit. And then my sensitive little ego couldn't take it anymore, so I quit cold calling. Then I heard, you know what? Turn every conversation into a real estate conversation. You guys heard that one?

Sure.

Yep. So I ran out to all the normal networking stuff that I was part of the Chamber of Commerce, you know, Toastmasters, I think I was part of BNI at that time, went, did the schmoozy type stuff again. That didn't work. Now again, I probably wasn't doing it all that well, but it just really felt clunky trying to pull up the old 30 second commercial, all that kind of stuff. And then I thought, you know, I was running out of time. So I got an extension, got a one week extension on this, on this deal. And I thought, hey, you know what, I know quite a few people. What if I just put together a little deal package and I email it to everybody I know? So that was my next brilliant idea. So I did that. I got excited because I started to see some replies coming in until I actually started reading some of the replies. And most of them were saying stuff like, hey, Dave, you know what, man? I haven't heard from you in eight years or ten years or five years or whatever. And here you come right out of the gate saying you're looking for money for a deal. Buzz off. Okay? So basically what I did is I shot myself in the foot with a lot of good prospective investors. And I vividly remembered I lost that deal. I had to. I got massive mud on my face with the, you know, because I'm in a fairly small market locally here. So the realtor was ticked off, the seller was ticked off, my tenant buyer was ticked off. I had to return all of their money to them, obviously, and was out several thousand dollars for costs and this and that. The other thing, and that was a point where I said, you know what, I never want to be in this position again. And that's where the light bulb went off. And that is when it's the chicken and the egg, the money comes first. When it comes to deals, have the money lined up first before you go tromping off, making offers on deals. Does that make sense, you guys?

Yeah, it makes sense.

It totally makes sense. But now I can imagine our syndication attorneys, you know, pulling over right now and saying, wait a second, Dave, that's a blind pool. You can't do that.

That's right, because I didn't know a heck of a lot about it. So I was doing it pretty, pretty much making every mistake in the book probably a good thing. I didn't raise any money that way because it was a, it was a clumsy way of going about it. Right. So, so that's when I got serious about the whole thing. And fortunately I've got a background in marketing and I thought, why don't I apply marketing to the whole idea of finding money partners, raising capital and staying compliant. In my case, I'm up here in Canada, so it's a little bit different than in the states, but we still got some pretty, pretty robust rules and regulations around who can invest and not raising money from the general public. Right. So, so I applied that and I started working on that. And that's where I came up with this whole five step process that I go through for raising capital and what I, what I suggest people do as well. And again, it might be slightly different in the United States. However, my understanding and correcting you guys if I'm wrong is that if you are raising capital from people that our friends, family members and close business associates, there is an exemption in that, in that realm. Correct me if I'm wrong.

Well, a gray area.

Yeah. Like, you know, I think it would all depend on which attorney you talk to.

Right?

Like one attorney's gonna tell you, don't even talk about it. Even if it's people you know. Another attorney would say, hey, Go have fun. But I think, I think it's, you got to have it a little bit laid out, a little bit fleshed out before.

So you go, you set up in a syndication or something like that. Is that correct?

Well, at least kind of a term sheet, you know, at least a term sheet. Attorney has reviewed and said you can go talk to some people with this term sheet because otherwise you're out there and I mean, you could be violating all kinds of security laws. And I don't know, Mark, I don't want to end up like, I don't know, like in prison.

Yeah.

I mean, I watch Billions and it scares me.

What's that?

I watched the show Billions on Showtime and running afoul of securities law really scares me.

Definitely, definitely. So that's why it's important that you understand what your local state security and federal security regulations are around. This my understanding was, and again I'm up here in Canada, is that if you're dealing with people that you have a pre existing relationship with, it's a lot less risky than going out to Joe Public.

That's absolutely true. Absolutely true. So walk us through the five part money partner formula, if you would.

Sure. So the first part is coming up with your target list of prospective investors. Right. So again, in my books, you want to be going after people that you have that pre existing relationship with. They know you, you know them and you can have a conversation. And here's the thing, right. Typically my experience has been you guys, in order for somebody to invest with you, they need to know you, like you and trust you. Right? Right. So to get a stranger to invest with you, you have to create know like and trust factor from scratch, which is quite difficult to do. But if you're dealing with people that you already know and who you, who already like you, you've got 2/3 of the equation taken care. Now we just have to work on the trust factor. Do they trust you investing capital with you into a real estate deal? Does that make sense? So the whole goal is to come up with a target group. I would shoot for between 150 to 200 people. Okay. A lot of people say, well Dave, I don't know that many folks, I don't know that many people. I suggest, yeah, probably you do, you just, you're not aware of it. So first thing you can start with is get all of your contacts off your cell phone, get them into one place, get them into a spreadsheet, get all your contacts from your email address, get them into one place, get all your contacts from all your different places, get them into one place, put it in something like a spreadsheet, and then quickly go through it and eliminate all of the people that you don't really have a relationship with. Does that make sense? So instead of trying to come up with a couple of hundred people, you start perhaps with a thousand or fifteen hundred and quickly whittle it down to get to a couple of hundred people. And then that becomes your core target group of people that you're going to be focusing on with your marketing. We're not going to be going out and marketing to the great unwashed masses. We're not going to be marketing to the general public. We're going to be marketing exclusively to that core group of prospective investors. Does that make sense, you guys?

Yeah.

Yeah. Scott, how are you?

Yeah, I'm good.

All right, so that's step number one. Step number two. Once we've got that core group, we want to avoid making all those stupid mistakes I made, all that clumsy stuff. And we want to reconnect with people on a personal level first before we start talking business, before we start talking real estate. So that was a big mistake I made back in the day. So now what we do is, what I recommend is a little simple three step warm up campaign. So the first step is we send out an email to those folks on that list and say, hey. Something like, hey, it's Dave. Chances are it's been a while since we reconnected. I just wanted to say hi, let you know what I've been up to for the last bit, talk a little bit about myself, the family, you know, what I've been doing for fun, trips, travel, hobbies, pastimes. I call this the Christmas letter from Aunt Nadine. I don't know if you guys remember that, but way back in the day, before the interweb, before cheap long distance, before social media, people used to actually write letters. You guys remember that?

Oh, yeah.

I got quite a few of these ginkgo biloba. I still remember that.

Yeah.

Mark, did you ever write a Christmas letter?

Did I ever write a Christmas letter?

Yeah, you.

I mean, my handwriting is so bad, I probably at that point in time, I was smart enough to get somebody to do it for me.

Oh, no, no.

How about your wife?

Did she write the Christmas letter or.

Did you guys just not.

Of course she wrote it. Oh, boy, Beautiful handwriting.

Nice. That's what my Aunt Nadine used to do. She used to write a Christmas letter once a year, photocopy it, send a copy with a Christmas card to everybody in the family. And that's how we caught up. That's how we knew what the heck they're up to for the last year. So it's kind of a modern day, modern day version of that. But I suggest you do a little quick recap of what you've been up to for the last five years. Right? So if you change jobs, if you've moved, you know, kids graduated, kids born grandkids, whatever the heck's going on in your life, just a brief little recap of what you've been up to. And then at the end of it, very important, say, well, that's what I've been doing. How about you? I'd love to catch up. Please hit reply, let me know how you're doing and let's connect. Send that out to the 200 and you're gonna get some replies. Go back and forth with the people that reply. Three or four days after that, we send out the second message and it's a even more modern version of that first one. We do this via video. I suggest you do a little three, four minute video, basically going over the same thing and sign off and say, hey, that's what I've been up to. Love to, love to hear how you're doing as well. Just hit reply to this email and let's catch up. That one really works well, you guys, and I think you can understand that. You guys are doing video podcasts and video stuff all the time. The video I found is the next best thing to being there in person with somebody.

All right, Absolutely.

And then the third one is the magic. It's the, it's the trend, what I call the transition message. And in that I would say something like this. Hey, it's Dave. It's been really good reconnecting with you over the last week or so. Want to let you know that moving ahead, I want to do a much better job of staying in touch and letting you know a little bit about what I'm up to with real estate investor. Real estate's something I'm very passionate about. I've been doing well with it. And in fact, I think it's the best way for everyday people like you and I to make an above average return on our money backed by something solid and that's real property. And who knows, maybe sometime in the future you might even want to partner up and we can share in some of the profits. But you know what, if you're not into real estate, that's okay too. Click on the Unsubscribe link at the bottom of any of my emails, you'll be taken off my list immediately. Okay, in the meanwhile, if you haven't got back to me, please hit reply. Let's connect, let's catch up. Take care, talk to you later. Off it goes. All right, so that's the three step reconnect campaign. Can you guys see how that'll work? So much better than spamming everybody with a deal.

Okay, I hear you, and I'm not trying to be a negative nelly here at negative Nelly, but I got to tell you something. I get that email and it's a book about you, and I haven't heard from you in years. I gotta be honest with you, I'm hitting like delete, not even unsubscribe. Because like, to me, that whole thing, like, even the whole reply to catch up, hit reply that sounds like you're after something from day one and I'm out.

Well, you're kind of a marketer, Scott. You've been around the. You've been around for a while. Here's, here's how this works. Actually, I was just talking to a client of mine who did this a little while, a little while ago. He got. Now this is exceptional. He got 770 replies. Positive replies, not negative replies. 70 replies from doing that. He had about 275 people on his list, but he started getting appointments and he actually got a deal just out of. It's not even designed for that. This is just supposed to be breaking the ice. Just talking to some other clients last night. They got 30 responses from doing that. All positive. Right? So it works. If it didn't work, it definitely worked.

Yeah, I think, Scott, we know how the sausage is made. So here's, you know, see this, this.

Is the problem, Mark, right? Like, I'm glad we're going down this path because here's the problem is, you see, like, I look at this and a lot of people make the same mistake, right? Like a lot of people when they're trying to learn something they miss. They make this exact same error, if you will. And the error is, is that I'm, I'm playing forward to where he's going, right? Like my brain is going forward saying, no, no, no, no. I see every red flag along the way. But yet I'm not the intended recipient. And if I was the intended recipient, my response probably would be delete and move on with life. But you see, I'm not the intended recipient. Somebody else is. And so you don't Know who those people are. And so if you're sitting there trying to come up with some sort of a strategy for anything, and you're playing this out, going, oh, well, that will never work, well, then you're making assumptions that you have no data to support it.

And.

And that's like a fatal flaw of business, making assumptions based on your own logic because your own logic is flawed.

Couldn't agree more, Dave.

Well, let me ask you a question, Scott. I appreciate that very much, but just to kind of put it in perspective, just bring somebody to mind, an old friend or an acquaintance that you've lost touch with for, let's say, 10 years. Like, I. If I think of this, I can think of an old high school buddy I have not seen in 30 years. Literally. We didn't hate each other. It's just life. Life separated. He went one way, I went the other way. He's not a social media. We haven't connected for 30 years. We were pretty good friends right now. So can you. Can you think of somebody kind of like that?

All right, I got a guy.

You got a guy. Somebody you like, right?

I like them.

You like them. Okay, now, if you got a video message out of the blue from that old friend and you got to watch him, and he kind of caught you up a little bit on what he's been up to in his life for the last five or ten years, right? That'd be cool. Or would that be pretty cool?

Okay, it would be cool. I. I would wonder, like, I'd be skeptical, but, like, if I had my guy and I sent him a video, I kind of know how I would do it to send him a video. I might just start with video as opposed to an email. Honestly, am I breaking rules there?

No, no, no. Hell no. Just most people are absolutely petrified of doing a video. Most people Done it before.

Look at this face. How can it not be on video?

Exactly. Man, look at the glow I got going up.

Took the words right out of my mouth.

Okay, I'm with. I'm with you.

I hear.

I hear what you're saying, okay?

But bottom line, it works. It works very, very well. Right? And here's the other. You're absolutely right, Scott. We are not our target market. Right. We are not the intended recipient. These are not other marketers. They are not other real estate people. These are people in our sphere of influence, you know, our contacts, people that we know who probably aren't real estate weirdos like us. Does that make sense?

Okay, I'm good.

So that's that's the first step. So we reconnect with them that way. Then there's a fairly good chance that you're going to have a few people saying, hey, kind of curious about this real estate thing. What are you up to with that? So that might be a good way to lead into sitting down and having a one on one conversation with somebody. In which case what I recommend is that you have some sort of a slideshow presentation that you can show them to give them a little overview of what you're up to with real estate investing. So that's really the next step is to be able to present your opportunities with poise and with power. And the big mistake I see a lot of people doing is they say, well Dave, you should be able to explain it kind of like an Amway thing with just a few, a yellow legal pad and a Sharpie and some circles and stuff. You should be able to explain it that way. Well, I can't do it very well that way consistently. But if you got a slideshow, if you got a short presentation you can show somebody, it's much more visually interesting for the other person. It helps keep me on track, make sure I don't forget any of the important questions I had for them. And it just allows us to do it, it systematizes things, it allows us to do the presentation the same way over and over and over again. So that's the next step is having a good presentation put together. Step number three, do you have any questions about that, you guys?

No.

Clear, clear. Step number three of the five step process is constant consistent communication. Constant and consistent communication. So educational type marketing, not salesy, not pitchy, not hypey. Educational type marketing, where we're staying front of mind with people about what we're about, real estate, what we're up to with real estate. And really just kind of working on having them see us as credible real estate entrepreneurs and authorities and experts, right? So a big mistake I see a lot of people make is they, they go crazy on this stuff when they've got a deal in the works, right? They got a deal on the go, they market like crazy and then it's crickets. You don't hear anything from the person. So that's why that constant consistent communication is so important. So that at least every couple of weeks they're hearing something from you. They're getting a little bit of education about real estate investing. Not too much because we always have. That's another big mistake is over trying to over educate people. Most of Your investors really don't care. What I found is they want to know that you know what the heck you're doing when it comes to real estate investing. Okay, so educational, entertaining type of communications.

And number four. What's that, step number four?

Well, step number four is to be seen as an authority. Right? And there's lots of different ways to do that. Good way to do that is to have a good investor focused website. When you're not sending this out to the great unwashed masses, but when you're communicating with people, what I suggest is that you have your website as your hub. Everything comes from your website. Everything brings people back to your website and it encourages them to reach out. Book an appointment with you so you can have a conversation and show them what you've got face to face. Right? So what your online presence looks like, how you dress when you meet with a prospective investor. So even if it's your Aunt Myrtle who used to change your diapers back in the day, I highly recommend that you dress business casual when you're going to meet with them. Show them respect because you're gonna be talking about them. Potentially investing with you helps you get respect from them as well. And it's just a much more professional kind of situation. All right? And then once you've got everything up and rolling, once you've got a couple of investors under your belt, then it's all about getting testimonials and perhaps starting to get referrals as well. So that's the, that's the main focus of. So that's the five step process there in a nutshell, you guys, It's a lot more involved, but that gives you the 30,000 foot overview.

It makes a lot of sense to me. I really like it. Scott. Todd, what do you think?

I got it. I agree. Sounds like a winning plan.

So I think, David, it's really clear that this is one of those things where money is kind of like, you know, an umbrella, right? You want to get your umbrella before it rains. You want to start getting all this prepared before you need the money and start sort of warming up, if you will, your contacts, your sphere of influence so that they are dying to either lend you money or going on a deal with you. But, but you can't just do it. Like you couldn't just go to a party and be like, hey, I'm Dave, wanna do a deal with me? Like what?

That's what everybody does, isn't it, Mark? That's what so many people do. And I find it's very Very clumsy. So this is a much better structure in my mind.

Absolutely, absolutely. Well, nowadays, I mean, this has been really fantastic mentorship, but we're gonna ask you for one more tip of the week. A website, a resource, a book, something actionable for the art of passive income listeners to go improve their businesses, improve their lives. What do you got?

Well, if they're interested in getting a much more in depth overview of how this all works, they can go to investorattractionbook.com and get an ebook version of the money partner formula, which is what this is. So again, that's investor attraction book, where they can get all of that. They can find out much more about it.

Tractionbook.com we'll have a link to that. Fantastic. Fantastic. I love putting Scott Todd on the spot. Scott, what's your tip of the week?

Okay, this one's kind of a fun one, man. Like, I see so many uses for this. It's pretty cool. But this is really geared to our friends who still have to report to their corporate gigs, right? And they're sitting there and they're like, man, I hate this. I just want to be sitting here watching, I don't know, like Netflix or something. But you can't pull up Netflix on your work computer and then like start streaming because that's not cool. You'll probably end up fired, which could be a good way to get your butt moving to go build some passive income. But here's the deal, Mark. I also see this tip as being useful for, like, other instances, like maybe when you just don't want to be bothered. Check this out. Go to netflix hangouts.com netflixhangouts.com It's a Chrome extension and it allows you to watch Netflix while it looks like you're in a conference call. Okay, like.

What?

Look at this, man. Like, if I had to go back to work, this is a staple item that's in my, in my browser Chrome editions. So look at this. This is. I love this thing. Now if we could just figure out how to get our images, like the podcast that we do, into something like that, and then everybody could just watch us all the time instead of, like, Netflix. That would make it even better.

Well, let's contact the developers and see how we can do that.

Yeah, there you go. Then they can just sit with us all day long at their work listening to us streaming us 24 7.

Yeah, I don't understand why Netflix hasn't contacted us and been like, hey, we really want to do our own, you know, our passive income channel and show I mean, we'll pay you guys $10 million.

I mean, you know, I always show the trailer that I've been pitching to HGTV about land investing. I show that at boot camp. Maybe I've been doing it wrong.

Maybe.

Maybe I need to follow Dave's formula and not just apply it to money, but apply it to pitching our TV show and get in front of Netflix or some other people. I'm sure we have people. Like, we know people, Mark.

We know people.

We know a lot of people.

We got people.

We do have people. So maybe we're doing this wrong.

We're definitely doing it wrong. The fact that we don't have our own show yet on Netflix, that. That says everything.

Well, it would be the boringest show ever.

It's like, here's the before picture, raw land, the after picture, raw land.

What are they gonna do? Just follow us around all day? Like, hey, what's going on? Just the pool guy, the. The lawn guy. The true story lawn guy came before I had this podcast. I had to go out and get the grass clippings out. That was like 15, 20 minutes, right?

I did a Peloton ride. That was 20 minutes.

I did that yesterday.

Yeah.

Netflix hangouts, man.

Netflix hangouts. So my tip of the week is learn more about Dave dubeau. Go to davedubo.com we have a link to it, because I bet no one can spell Dubois. I'll spell it for you anyways. D U, B as in boy, e a u dot com. Davedubo.com and Dave, are we good?

Awesome. You guys. It's been a lot of fun. Thank you very much for having on having me on your podcast. I appreciate it.

Thank you, Scott. Todd, are we good? We're good, Mark. We're good listeners. Look, do us a favor, please. Three little. Three little favors. You got to subscribe, you got a rate. You got to review the podcast. Send us a screenshot of that review. To support thelandgeek.com we're going to send you for free our $97 passive income launch kit. So please do that. It really, really helps. Send it to a friend on the Interwebs. Share it. Everybody wants passive income, so we really appreciate it. And Scott, are you ready?

We're ready, Mark.

Let.

Oh, freedom.

We don't even know our day anymore.

This is awkward.

1, 2, 3.

Let freedom ring. That was the worst one ever.

Dave's like, well, note to self, won't come back on that podcast.

Just cut it.

Just cut it here, Mark.

Yeah, they're like, they are really great until the very end.

It's all good, guys. You're awesome. Thanks very much.

Thanks, Dave. Thanks, everybody.