My Private Money Plan

I attended a workshop this weekend conducted in Seattle by SEC Attorney Jillian Sidoti entitled “My Private Money Plan.” My REI Capital business partner Bob Malecki and I hired Ms. Sidoti to prepare the Private Placement Memorandum (PPM) recently for our $5 million capital investment fund.

There were roughly a dozen other participants who attended this workshop, all from the greater Seattle area. Most were experienced real estate investors seeking ways to expand their investment opportunities by raising private money. One of the advantages of attending a workshop like this is to meet other like-minded investors.

Jillian Sidoti spent the first day of the workshop helping participants focus on the specifics of their business plan, beginning with their own bios or introductions. People are willing to give money to those they trust and respect. So having a solid understanding one’s strengths, vulnerabilities, and accomplishments are key to establishing credibility. This simple bio statement will be included in the investor’s PPM, website, credibility kit, marketing materials, and elevator speeches.

Ms. Sidoti also stressed the need to be as specific as possible about the types of real estate investments that one intends to seek for investment. These can – and should – be as unique to the particular investor as possible. It provides a compelling reason for someone to want to invest their own personal funds, along with the specific rate of return they might expect from that investment.

She also provided a great deal of information about how to comply with state and federal regulations regarding the sale of securities.  Private money investment in a real estate transaction is considered a security. There are severe penalties for not following the rules on soliciting private money investment.

The second day of the workshop was presented by Chris Yates of CM Yates Capital. He is a successful real estate investor from California who has handled approximately 500 real estate transactions, and became a client of Ms. Sidoti when he held over 100 single family homes with 100 separate investors. He has automated the process of finding private money lenders, and participants at this workshop will be the first to utilize the new training program he has created. I am really looking forward to this, and the timing for this could not be better for me in terms of launching our new real estate investment fund.

Mr. Yates gave great examples and tips on how to build massive credibility within a short period of time. These tips included writing a review of a seminar or workshop, which I am doing right here. Other tips include preparing your bio and website, joining trade organizations, such as the Real Estate Association of Puget Sound (REAPS) or the Northwest Multiple Listing Service. You may also write your own seminar or webinar, write articles such as my series in the REAPS monthly magazine, and contact local media. Such activities help establish an investor’s credibility as an expert in their particular industry niche.

Mr. Yates shared a great deal of information on deals he has done recently, multiple ways to finance real estate investments using private money, and a general philosophy on what he called “impact investing,” which boiled down to investing with the intention of making a difference in your community.

Overall, an excellent two-day workshop with some valuable training, tools, and networking opportunities.