In the latest episode of the Raising Private Money podcast, host Jay Conner joined forces with renowned real estate investor James Lascara to delve deep into the nuances of raising private money in real estate. The discussion shed light on a wealth of practical advice and strategies essential for both novice and seasoned investors. With James sharing his extensive knowledge from the trenches and Jay contributing his signature ethical approach, the episode is a goldmine of information. This blog post will distill the key takeaways and expand on their insights to help you fortify your real estate endeavors.
The Importance of Knowing Local Business Practices
James Lascara begins by emphasizing the critical importance of understanding business practices in different states. Whether you’re in Florida, North Carolina, or another locale, closing deals often necessitates the involvement of title companies or attorneys. These professionals help mitigate risks and ensure transactional integrity. James underscores trustworthiness verification through personal conversations and advises seeking a second opinion if something seems off. This due diligence can safeguard investors from potentially fraudulent schemes.
The Power of Networking: The Elite Investor Mindset Group
Networking plays a pivotal role in the real estate sector, a fact underscored by James’s founding of the Elite Investor Mindset Group in Tampa, Florida. This mastermind group is a hub for successful professionals seeking collaborative growth and shared insights. Networking not only fosters relationships but also provides a forum for discussing opportunities and challenges in the real estate market. James leverages Instagram (@jplinvest) as his primary communication platform to connect with investors and disseminate information about ongoing investment opportunities.
Risk Mitigation and Trust Building in Private Money Raising
Jay Conner and James Lascara both emphasize the importance of integrity and trust when raising private money. Jay warns against sending money to lenders before closing, sharing a sobering cautionary tale of an investor who lost $40,000 to a fraudulent lender. Conducting thorough due diligence, verifying the legitimacy and history of the lender, and ensuring investments are protected by equity are steps that can save potential investors from catastrophic losses.
James relates his experience with a significant personal investment mistake, where a loan wasn’t backed by collateral. This has driven home the necessity for practitioners to always ensure their investments are protected. Both Jay and James advocate for an abundance mindset, believing that opportunities arise naturally when one leads with value and maintains a positive outlook.
Tools and Strategies for Efficient Fund Management
In terms of practical tools, James mentions using Google Sheets and Excel for tracking investments. While he is exploring suitable CRM systems to streamline various business facets, he remains diligent about updating and managing private money matters. These tools aid in maintaining transparency and efficiency, pivotal for fostering trust among investors.
Effective Investor Engagement and Communication
Investor engagement is another cornerstone of successful fund-raising. James leverages a simple one-page graphic to introduce potential investors to their initiatives and schedules follow-up calls, providing a clear and concise initial overview. Offering three ways for passive investors to engage, he tailors communication frequencies based on investor involvement. This individualized approach ensures that investors feel informed and valued.
Networking is indispensable for sourcing initial investor contacts. James advises beginners to tap into their networks and seek introductions to potential investors. Jay concurs, advocating for an educational approach where investors are informed about the private lending program in detail, covering aspects like interest rates, protection, and note lengths.
Building Credibility and Establishing Trust
Building trust and credibility with investors is a long-term endeavor. Sharing detailed track records of past projects helps potential investors feel more comfortable. James recommends asking investors what information they need to feel secure, emphasizing transparency. Jay enhances this by leading with education rather than pressing for deals, creating a pressure-free environment conducive to partnership-building.
Final Reflections: Integrating Lessons and Strategies
The episode encapsulates a treasure trove of strategies and lessons crucial for anyone involved in real estate investment. James and Jay highlight the significance of networking, rigorous due diligence, and establishing trust. Approaching potential lenders with a value-first mindset, maintaining an ethical stance, and using practical tools for efficient fund management form the bedrock of successful real estate ventures.
By absorbing these insights from James Lascara and Jay Conner, you’ll be better prepared to navigate the intricate landscape of raising private money, fostering trust, and achieving sustainable growth in your real estate career.
10 Discussion Questions from this Episode:
- For James Lascara: You mentioned the importance of using title companies or attorneys for closing deals in states like Florida and North Carolina. Can you elaborate on the risks of not following this practice?
- For Both Guests: How do you verify the trustworthiness of potential business partners or lenders in real estate transactions?
- For Jay Conner: You shared a cautionary tale about an investor losing $40,000 to a fraudulent lender. What steps can investors take to avoid such pitfalls?
- For James Lascara: Your Elite Investor Mindset Group in Tampa sounds intriguing. Can you discuss how forming and participating in a mastermind group has contributed to your success in real estate?
- For Jay Conner: You emphasized educating potential investors about private lending programs. Can you share some key points that should be included in such educational conversations?
- For James Lascara: You prefer communication via Instagram for connecting with real estate investors. How has social media influenced your ability to network and raise private money?
- For Both Guests: You both stressed the significance of an abundance mindset in attracting investment opportunities. How do you cultivate and maintain this mindset, especially in challenging times?
- For James Lascara: Can you give us some details about the current investment opportunity in Bradenton, Florida, and the potential tax benefits for qualifying investors?
- For Jay Conner: When raising private money, you avoid discussing specific deals in initial conversations. What are some strategies you use to build trust and present opportunities to potential investors without coming off as desperate?
- For James Lascara: You discussed learning from a personal investment mistake in 2021 where a loan wasn’t backed by collateral. What steps do you now take to ensure your investments are always protected by equity?
Fun facts that were revealed in the episode:
- James Lascara runs a local mastermind group called the Elite Investor Mindset Group in Tampa for successful real estate professionals.
- James prefers to communicate and connect with real estate investors via Instagram (@jplinvest).
- One of James’s investment opportunities is in a qualified opportunity zone in Bradenton, Florida, which offers potential tax benefits to qualifying investors
Timestamps
00:01 Raising Private Money Without Asking For It.
04:05 Immense focus on projects ensures high returns.
08:16 Engage others by sharing your story succinctly.
12:28 Building trust with private lenders is crucial.
14:55 Build trust first, avoid desperation in fundraising.
16:23 Investing process: No-pressure communication and trust-building.
21:46 Seek asymmetric bets; understand risk and mitigation.
23:41 Avoid wiring funds without verified funding sources.
28:37 Great tax-advantaged investment opportunity in Bradenton.
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