In this episode, I talk about why all real estate investors should be 100% transparent in their business. The reason for being transparent might seem obvious, but I am going to give you some great examples of using transparency to really propel your business forward!
When it comes to their business, many business owners have a hard time being transparent. Sometimes it’s because the business isn’t as successful as they want it to be. Sometimes it’s just a matter of privacy–they feel like letting others know their finances and other intimate details exposes them too much.
In your business, transparency it’s important because it makes other people feel more comfortable working with you. It also is important when borrowing money. If you are trying to borrow money from a traditional lending institution, you should be as honest and forthcoming as you can be right from the start. Trying to make your business look more successful than it is will eventually catch up with you.
Even if you manage to fool a lender such as a bank in the beginning, eventually they will catch up to you. If you are not transparent at the start of the process, and the bank discovers something that you did not tell them halfway through , everything can fall apart. Not being able to close a deal because the bank had to pull out will make your business look very bad.
I have said many times that real estate is a very local business. Getting a bad reputation because you are dishonest will hurt you now and in the future. Because of technology, and specifically the internet, your bad reputation can spread far beyond your local community. The last thing you need is to get a reputation for being unreliable, or worst, dishonest.
Being transparent not only will keep you out of trouble, but it can also give you a competitive advantage over the competition! A great example of that is something I did in my own business early on. When I bought my first investment property and started going through with the process of rehabbing, I took pictures and video right from the start. I continue to document the process meticulously from start to finish. I created a Facebook page and started posting pictures and video of the property and everything that I was doing to it. This gained the attention of others in my community and before I even finished the project and sold the property, I had private investors approaching me to help fund my next project.
This happened not because I was a better flipper then others around me, but because I was the most transparent and the most willing to be completely open and honest right from the start. That transparency translated into business relationships that have fueled my real estate investing company for the last six years!
So being transparent is not only the right thing to do, it is absolutely one of the best strategies that you can use to help create business partnerships and position your business as one with integrity and honesty at its core.