In this episode of the Raising Private Money podcast, we delve into an inspiring journey of financial transformation with Mike Deaton. Mike and his wife, Ligia, found success in a niche part of the real estate market—flipping vacant land. Mik shares their story, educating listeners on how they raised over $1,000,000 in private money and crafted a life they desired.
A Nagging Dissatisfaction with Corporate Life
Mike Deaton was once deeply entrenched in the corporate world, relying heavily on his job for income, supplemented only by modest investments in the stock market. Like many professionals, Mike faced the stark reality of job loss, which propelled him into a period of introspection. Despite contemplating a return to corporate life, he couldn’t shake a persistent feeling of dissatisfaction, urging him to explore alternative income streams.
Inspiration from “Rich Dad Poor Dad
The influential book “Rich Dad Poor Dad” catalyzed Mike and Ligia’s venture into land flipping. Inspired by the success stories depicted in the book, they invested in their education by attending a boot camp focused on flipping dirt. Armed with newfound knowledge and a 12-month timeframe with a defined budget, they embarked on their land-flipping journey.
The Mechanics of Land Flipping
Land flipping, also known as “flipping dirt,” involves purchasing vacant land below market value and reselling it at a profit. Mike and Ligia primarily focus on properties with acreage, leveraging owner financing to facilitate more accessible transactions. They employ a strategic approach to locating potential sellers, utilizing list service providers to gather data on property owners. A particular focus is placed on out-of-state owners, who are often more willing to negotiate.
Raising Capital for Real Estate Ventures
Raising over $1,000,000 in private money is no small feat. Both Jay Conner and Mike Deaton emphasize the critical role of education and trust-building in this process. They highlight the importance of personal contacts and networking, attending events and clubs to educate individuals about passive investment opportunities in real estate.
Jay Conner shares his approach to simplifying real estate financing language and hosting networking events to attract potential investors. Both speakers stressed the necessity of confidence and caution against appearing desperate, which can deter potential investors.
From the Corporate World to Real Estate Success
Mike and Ligia’s transition from the corporate sphere to successful real estate entrepreneurs wasn’t instantaneous. They started by purchasing properties through direct mail campaigns, offering specific purchase amounts like $6,500 or $3,200, with the initial funding coming from their company’s cash flow. For larger deals, they explored options such as institutional and private funding.
Finding Buyers and Building on Success
Selling the properties is another critical aspect of their venture. Mike utilizes a combination of social media platforms, paid listing sites, and an email list of interested buyers to secure sales. Their land-flipping success has paved the way for further real estate endeavors, such as raising funds for multifamily syndications.
The Power of Coaching and Mentorship
Understanding the complexities of the real estate market, Mike offers coaching services through flippingdirt.us. This initiative is designed to provide support and guidance on various strategies within the land-flipping business, helping aspiring entrepreneurs kickstart their real estate careers.
Advice for Aspiring Entrepreneurs
Mike’s advice to those aspiring to break into real estate or any entrepreneurial venture is straightforward: take action. He emphasizes the importance of starting, even when conditions aren’t perfect. Waiting for the “right” moment can often lead to missed opportunities and prolonged dissatisfaction.
Conclusion
Mike and Ligia Deaton’s story is a testament to the power of education, strategic planning, and taking decisive action. From the uncertainties of the corporate world to the liberation of financial independence, their journey offers valuable lessons for anyone looking to transform their financial future through real estate.
10 Discussion Questions Based on this Episode:
- What initially motivated Mike Deaton to explore alternative income sources after losing his job, and how did his dissatisfaction with returning to the corporate world influence his decision?
- How did the concepts from “Rich Dad Poor Dad” and success stories of land flipping impact Mike and Ligia Deaton’s decision to start their land-flipping venture?
- The Deatons invested in education and attended a boot camp before starting land flipping. How important do you think formal education is in the field of real estate investing?
- What strategies have Mike and Ligia Deaton found most effective in their land flipping business, especially in terms of locating potential sellers and purchasing properties below market value?
- Owner financing seems to be a key element in their success. Can you explain how owner financing works and why it might be an advantageous approach in real estate investing?
- The Deatons transitioned from the corporate world into real estate. What challenges might someone face when making such a career shift, and how can they be overcome?
- Mike Deaton mentioned raising over $1,000,000 in private money for real estate deals. What are some methods they found effective in raising private money, and how do they build trust with potential investors?
- Both Jay Conner and Mike Deaton emphasized the importance of educating private lenders and potential investors. What strategies can be used to simplify investment concepts and build investor confidence?
- After building their land business, the Deatons ventured into multifamily syndications. How do pooling assets for larger property purchases differ from land flipping, and what skills or knowledge are transferable between the two?
- Mike Deaton offers coaching on the land flipping business through flippingdirt.us. What key pieces of advice would you offer to someone starting in land flipping or real estate investing based on Mike’s experiences and insights shared in the episode?
Fun facts that were revealed in the episode:
- Mike and Ligia Deaton were inspired by “Rich Dad Poor Dad” to venture into land flipping after losing a corporate job.
- They strategically target out-of-state property owners using data from list service providers for easier negotiations.
- The couple enjoys an adventurous lifestyle in Colorado, thanks to the success of their land-flipping business.
Timestamps:
00:01 – Raising Private Money Without Asking For It
04:23 – The Deaton’s pivoted from corporate to real estate.
07:31 – Engage in real estate investment through conversation.
12:57 – Offer unique investment, add value, no pressure.
16:55 – Feeling stuck, sought new life through entrepreneurship.
19:22 – Overcame financial hurdles, scaled business, prioritized lifestyle.
22:51 – An analytical approach evolved into trial and error.
26:20 – Leveraging private money for real estate deals.
29:36 – Helping others find land success is rewarding.
29:11 – Connect With Mile & Ligia Deaton:
30:57 – Desire for financial independence, escaping the rat race.
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