In this episode, I explain why you should always work to create a win-win situation for your business partners. This applies to all phases of your business. It is a very common mistake for real estate investors to be so focused on what they want and what they need that they forget to make sure to consider what other people require. In other words, if you approach someone asking for something, you better figure out a way to create value for them as well!
New real estate investors (and many experienced ones) get so caught up in their drive to succeed, that they often forget that other people have needs to! All of us depend on other people and/or other businesses, to some extent, in order for our business to succeed. In real estate, we have a few key people or businesses that we depend on, such as:
- Title companies
- Insurance companies
- Hard money lenders
- Private investors
- Virtual assistants
There is something that we want from each of these entities. When approaching a realtor for example, you should try to separate yourself from the dozens of other investors who have most likely contacted them asking for leads. Instead of saying “send me all good leads from any county in the area that I can get for 50 cents on the dollar,” try being more specific and memorable. Perhaps phrase it more like this: “ I am looking for properties under 100k, in Macomb County zip codes 48313, 48315, 48316, that are brick ranches with a basement and a garage.” That is a much more specific and memorable request than just “send me great deals!” That is vague, and it’s not going to make the realtor remember you when a specific deal comes up.
Whenever I approach a private investor or another potential partner, I try to find out what their needs are before asking for something from them. The best case scenario is t0 work with people that have skills and resources that complement yours. For example, early on in my business, I was approached by investors who possessed the funds to do deals, but didn’t have one of the following:
- Time to do deals themselves
- Knowledge to do deals themselves
- Desire to do deals themselves
That was a great match for me because I had the time, knowledge, and desire, but lacked the funds. I did many deals with exactly those types of arrangements. My investor would put up 100% of the funds needed to buy, renovate, and sell the houses, and I would identify, renovate, and sell the properties. At the end of the deal we would split the net profits 50/50. That is a win-win situation.