In the last five or more years, interest in MF investing by private individuals has sky-rocketed. We occasionally get asked by new passive investors, what can I do to increase my odds of being selected into an offering? I mean, as an experienced Lead/syndicator wouldn’t you keep going back to those who have invested with you in the past?
I’ve answered this questions so many times, that I thought I would share my response for those that perhaps have thought this but not got around to asking it. Generally we do choose repeat investors – those that have invested with us in the past. However, with both the sales/purchase prices of MF increasing over time, as well as our continued desire to acquire newer and larger properties – think efficiencies of scale – then we usually need to raise increasing amounts of capital. As a result, we often take in passive investors that have not invested with us before. So, how to you make yourself standout?
Network, network, network
If you only meet us once at a busy event, and spend just a couple of minutes talking with us, then there’s a good chance that we will not remember you 6 months later. Sorry, that’s just the way it is. After making initial contact, then if you live locally follow up and arrange to meet for coffee or lunch somewhere. Alternatively, if you are not local, then arrange a time for a virtual face-to-face.
The SEC requires us to have a “substantive, pre-existing relationship” before you invest with us, so the more substantial this is, the better.
Photos
I (Steve) tend to remember faces better than names, so be sure to include a photo in your profile and/or email signature.
Dare to be different
Do or say something unique or different – find something we have in common aside from real estate, and share a story about that. Recently I meet a very out-going and fun gentleman who called himself, “The Black Elvis” because he was born on the same day that Elvis Presley died. I don’t know if “The Black Elvis” could sing, but he sure made a great and lasting impression. If he references that in his profile or in subsequent emails, I’ll immediately remember him.
Larger investments are not always the answer
When it comes time to raising funds for an investment then it is true that larger investments tend to carry more weight. But if you follow the previous suggestions, then this need not be a determining factor. This is great news for passive investors that may not have deep pockets, but do want to get started investing.