“True wealth isn’t what you accumulate—it’s what you help others achieve.”
— Zig Ziglar
I’ve raised over $45 million for real estate deals in the last few years.
Some of these deals have been for cash flowing assets like oil and gas.
Raising that much money has completely changed my personal wealth strategy.
I’ve made over 2,500 calls with high-net-worth investors and have even done deals with some.
That experience has taught me some pretty useful things.
Today, I want to share the secrets I’ve learned.
Let’s get into it!
1. The Importance of Relationships in Capital Raising
People say that if you want to raise capital in business, you should only work with people you like and trust.
This is also true in passive investing.
The people who get the best deal flow have relationships with other passive investors.
They’re in relationships with great operators and managers.
These relationships are transformational.
You can share ideas, share notes, and share what’s working and what’s not.
Successful passive investors will bounce ideas off of one or two other investors in their field.
Better investor relations have even been connected with greater visibility, information assimilation, and valuation.1
It’s a great tool to try for yourself!
2. Lessons in Scaling Wealth
There are two parts to scaling wealth.
The first thing is deal quality.
Many people are fooled by numbers.
Whether the deal is said to have a 20% return or a 100% return… those are just numbers.
They don’t mean anything.
Great investors will often look for lower projections, or overall more conservative projects.
Sometimes, taking a lower return will have more upside compared to a risky deal with so-called higher returns.
As people become better investors, they tend to become more conservative.
In the stock market, the conservative formula has outperformed the market with a compounded annual return of 15.1% since 1929.2
Warren Buffett says one of the best things you can do is not lose money.
I’ve lost money and can safely say that it’s painful.
In my book, Fire Yourself, I tell the story of how I lost $70,000 in one day.
That was the moment I realized options trading strategies were not for me.
The second part to scaling wealth is the deal’s size.
When investors start out in real estate, many will buy a house or a few rental houses.
In my experience, though, larger deals are actually easier.
Buying 100 units is simpler than buying a duplex or a fourplex.
You don’t get as much of a return from smaller deals.
With any deal, there’s a lot of work that goes into crossing the finish line.
But with larger deals, you have much better resources and help.
Your management team is more efficient.
You have onsite maintenance to help with the larger projects.
In a way, there’s more at stake, but it’s actually easier in a lot of ways.
Many people go for larger deals and become hands off.
The goal, as Warren Buffett would say, is making money while you sleep.
The alternative is to keep working.
In my book, I talk about a scalability test.
If you can’t 10x your current investment strategy, then you’re not passively investing.
You’re just doing more work.
For example, if you have three rental houses, could you immediately 10x that amount to 30 houses?
If that sounds impossible, you need to start thinking about scaling in a different way.
Find a strategy that achieves true passive investment.
Find a team you trust to operate the deals you find.
Those steps will allow you to scale your wealth.
Larger deals sound intense, but they’re really just more zeros.
The largest apartment deal we’ve done is over $60 million.
We have friends who have done deals worth over $100 million.
Larger deals are just more numbers.
Find deals that make sense for you.
3. The Value of Giving Before Asking
People go to successful people because they want things from them.
This happens all the time.
But the real way to make connections with successful people is to find a way to serve them.
Zig Ziegler says you can have anything you want in life if you help enough people get what they want.
To do this, ask yourself questions like:
What are the ways I can help this person?
How can I support them?
How can I empower them?
When you find the answers to those questions, it’ll lead to amazing opportunities.
This is true even as a passive investor.
If you can find a way to serve others, doors will open for you.
That’s really our mission at Bronson Equity.
We want to empower investors so they can find passive cash flow and an appreciation of tax benefits.
To summarize: Don’t underestimate the power of relationships.
Investing is not a solo sport.
If you treat it like one, you’re going to make mistakes.
You’re not going to get the best deal flow.
Talk with other people and make use of their insight and valuable information.
Now I want to hear from you!
What are your investment relationship goals?
Let us know in the comments.
Before you leave, make sure to check out our special report about inflation investing. It shares the best choices to invest during an inflationary environment.
If you are interested in investing with us, we are happy to answer any questions that you may have. Join our investment club today and we will be in touch.
Check out my bestselling book on Amazon!
Disclaimer: I am not your investment advisor. This is for educational purposes only. I am not giving specific advice on what you can do. I am simply giving my opinions.
Works Cited
1. D. Bazhutov, A. Betzer, François Brochet, Markus Doumet and P. Limbach. “The Supply and Effectiveness of Investor Relations in Insider- vs. Outsider-Oriented Markets.” Manag. Sci., 69 (2022): 660-683. https://doi.org/10.1287/mnsc.2022.4368.
2. David Blitz and P. Vliet. “The Conservative Formula: Quantitative Investing Made Easy.”, 44 (2018): 24 – 38. https://doi.org/10.2139/ssrn.3145152.
