If you’re looking for real estate jv partners I would argue it’s not about ‘presenting’ yourself as a “professional” as it is being totally transparent and REAL.
I’m not a fan of ‘faking it until you make it’; and in today’s world, more than ever, people’s bullshit meters are working extremely well.
When I’m teaching how to present to real estate jv partners to ANY group – experienced or not…
I always see eyebrows raise when I suggest “tell ’em your story”
And I mean your REAL story.
Story of struggle and frustrations.
The truth that you “don’t have a property yet” but you’re investing in professional coaching and education to learn how to do it the right way because [insert frustration / story here].
People want to deal with people they KNOW, LIKE AND TRUST…
And I’ll add another one in there…
People they SHARE COMMONALITIES with.
How We Find Real Estate JV Partners
I get asked this all the time.
First of all – I’m not the ‘guru’ of real estate jv partners…
I just believe in order to help people invest their money, essentially becoming ‘partners’ in my business, I absolutely must be transparent.
My wife and I share personal triumph and challenging stories which reveal who WE are – as a family, investors, business partners and friends.
I honestly believe “why would ANYONE want to invest WITH me if they don’t know who I am?”
I will argue It’s NOT really about the deal or numbers – because ANYONE can show a “good deal.”
People invest with YOU.
Not your pro forma.
So let them KNOW you.
Have you ever heard anyone say “you don’t know what goes on behind closed doors?”
Anyone can portray a perfect family or business life (just scroll through Facebook and you’ll see what I mean) but if it’s not true, eventually the curtain comes down.
How would your real estate jv partner feel if they made a poor financial decision just because you’re a good sales person?
I’ve made every effort to NOT be a false person and show who I really am.
The challenge a lot of people have with this approach is wanting everyone to like them so they avoid standing up for what they believe…
AND they pretend to be something they’re not by ‘faking it’.
Don’t you agree it is easier going through life and interacting with people as YOU?
Here’s a True Life Example:
When I agreed to assume responsibility of my fathers’ business in 2005, I chose to run it from the background.
I did not want to be the front person even though I had been involved my entire life and clients /employees already knew me.
Also, because I was coming from a completely different business I was NOT a corporate white-collar type and neither did I want or know how to BE one.
There’s nothing wrong with it, it just WASN’T who I was.
So I delegated ‘front people’ to play the golf games and dine the clients and so on.
The point? I WAS REAL from the get-go and I didn’t need to ‘pretend’ to be something else to gain false respect.
If I had done that, eventually people would see me ‘behind closed doors’ and my cover would be blown, so to speak.
So this is how I am today in my new career.
The reason I don’t want to be known as a real estate jv partner “guru” is because I really don’t know EVERYTHING about the subject.
I know enough to teach it – and to share my experience in how I personally find real estate jv partners.
I have business experience and skilled (if you want to call it that) in building truthful relationships.
And anyone who really knows me will vouch for that statement.
Take me or leave me; either way, you can be assured what you see is the real deal.
Reading all the inspiration books, blogs and quotes will do nothing if you don’t believe and put them into action. You would be fooling yourself – and not WALKING THE TALK.
I will close with this thought: THE MOST important thing is to BE REAL as it is the easiest way to have true friends and run an effective business.
When you create a relationship based on false information, you are constantly trying to remember what you said and to whom. But if you are always honest and true, there is no stress in having to remember anything…what you said yesterday still holds true today!
I want to acknowledge REIN and Russell Westcott for their encouragement and teachings. Check out this article as a start if you are interested in knowing more about joint ventures.
I Love it, keep up the great work
Thanks Ian!!
Great post! I'm a rookie investor, any comments would be greatly appreciated. What criterias do I have to pay attention when look for JV partners? Do you suggest to JV with family and friends? or with fellow investors?
Hi Steph – I am glad the post helped you – I will be doing more posts on joint ventures and am currently developing an ignition course to Joint Venture that will be of interest to you. When you are looking for criteria in a JV partner, it really depends on what you need them for. Is it for liquid capital $50,000 or more? Is it secondary financing with an RRSP? Do you want them to take on the mortgage? The first step is figuring out why you need a JV and WHAT you need them to bring to the table. Most of the time it is of course capital and in many cases qualifying for mortgages. If that is the case, you want to find someone who has a very stable income, has a mindset that understands the real estate investment pros and cons and does not have the time to manage everything themselves. I personally drew out my ideal JV partner down to what car he drives, if he has a pet, married, single, kids, ages, what he likes to do in his off time that sort of thing. This helps you narrow your search and filter people out immediately that do not fit that profile. As you can see, there is no right answer to your question because it depends on what you are specifically looking for.
The same goes for choosing to work with family, friends or fellow investors. The way I choose my partners depends solely on my profile first, going through a series of meetings to challenge scenarios that will pop up. I test their mindset and watch carefully how we work together. The partnership is the most important thing, then what they can bring to the deal. Some work well with family some don't. If you do, ensure you structure every deal like a solid business – that goes for close friends also. I have seen to many times how sour a relationship and deal can go without the proper guide in place.
Fellow investors is a great tool for me. The investors who choose to work with me are ones who have started investing and figure out it is not for them because there is way more to it that first thought. With their current career, family life and all the rest, they choose to become the money partner. It is an easier transition because they already get the investing concept!
Hope this long winded reply answers most of your questions, and look out for my JV Ignition Program coming soon. If you want to be on the initial standby list, send an email to [email protected]
Hi Joe,
Thanks for your valuable advise. It definitely helps when I meet potential JV partners. Cheers! Please keep up the great postings:)
You are very welcome Stephanie, I will be posting more about joint ventures and please stay tuned for the special JV – Ignition program coming soon!!!
Hi Joe, thanks for inviting me to your blog 🙂
I totally agree with staying real, true and honest. That’s the best policy and also the easiest one and I have always recommended friends and family members to do so, especially my kids….
I was also looking for your insights regarding structuring a Joint Venture deal, where I am going to qualify for the mortgage and my investor is putting down the down payment.
I am willing to pay him interest on his investment, however using the money as 2nd mortgage will not allow me to take money out of the deal (in order to use in my next investment), since I assume the banks would not go over 80-85% LTV.
What would you recommend, based on your experience?
Thank you in advance!
Welcome Hagit …. thank you for your great comments and I'm happy you like the blog! Honesty will always get you further in your venture than anything else. Even if your honesty 'kills' a deal, it tells you about the person with whom you are dealing. That said, I want to understand correctly what you are asking regarding the JV capital. When you say you are willing to pay him interest, does this mean he will hold no interest in the property? If so, this is basically a straight loan or mortgage like you said. Please elaborate on how you want to take money out of the deal and when.
I guess I am back to my original question, which was: is there a way to structure a joint venture in which I qualify for a mortgage, someone else brings the down payment and gets interest on his money without being equally responsible for the mortgage/on Title?
Hagit, this is really a loan – not a joint venture in my opinion. The only precaution for the lender would be how the money is secured – and that's why most have either title to the property, register a JV agreement on title or have a second mortgage. I suppose if you have a lawyer draw up a loan agreement and there is a way to have it secured against the property without title or ownership, it would work but I can't really comment on that as I have not done it that way and I'm not a lawyer. Check with you professional , they should know the answer to that easily.