There is an old saying that says, "The only ship that is guaranteed to sink is a Partnership". Obviously, that is not the case in all partnerships. However, you may have been in a bad partnership that did not work out. Most
partnerships do not work out for a number of reasons. I work very well
with my partners. I think we will continue to work together for the rest of
our lives. But there is one main reason why, and it is because of the way
we analyze our partnership.
The next thing we are going to look at is why most partnerships fail. Most
partnerships fail because of how we enter them, or how they start.
Investors come in and they think, “Johnny is my little brother and he wants
to get into real estate. He has had these dreams and aspirations and we are
going in together. He does not really have much of anything and only
makes $7 an hour at McDonald’s. He is going to be a great partner for me
because he is willing to work, he is willing to do it and bring that attitude
to our partnership.”
First problem: you have not looked at it analytically. You have not looked
at your strengths and weaknesses and been honest with yourself. You have
not looked at his strengths and weaknesses and been honest with him. You
have not said, “Do we compliment each other?” When you are looking at
partnerships, the value your partner brings is something you need to find
out and remember. The value added to a partnership is a core component.
Why do I bring up partnerships? Your reaction is, “I bought the program
and I’m doing it by myself.” Great; but there will come a time in real estate
investing – because of the mass and the quantity and the amount of money
involved – that you will need partnerships. For those of you who have little
money to start with, you are going to need a partnership to get you off the
ground.
You need to look at what the value is for a partnership. You need to look
at it analytically:
• Are we forming the right type of partnership?
• Are you complimenting my strengths?
• Are you filling in my weakness?
• Are you just going to ride on my shoulders the entire time?
I promise that if you enter a partnership where your partners ride on your
shoulders the whole time, it will not work. You are going to feel
overburdened; you are going to feel unappreciated and you are going to
hate what you are doing to the point that it may force you out of real estate
investing altogether.
You need to understand what your strengths and weaknesses are. And
remember, you need to understand what you are going to do and you need
to do it despite the negative energy out there; despite all the negativity that
everyone is going to give you. You may hear that little devil sitting on your
shoulder telling you that you are not good enough. You are not smart
enough. Why are you doing this? You are going to lose everything. You
will be defeated.
Don’t listen. You need to move forward.
The other reason why partnerships fail is because of one word: greed. Yes,
greed will kill any investment; it will kill any partnership; and it will take
away any added value and destroy everything you’ve built. Check yourself
with your greed. By this I mean that you need to make sure that people are
not going to be greedy.
Write down the details of your partnership. Get everything in writing and
ensure that you follow those details exactly. Become integral in what you
do, be honest with what you say, and move forward. Do not let greed
overpower you, try to trick you, or destroy a good thing.
Now that we have talked about how to understand yourself, your core
motivations, and investor dilemma and risk, let’s sum it up like this:
Remember that you are... The captain of your future.
You can be successful no matter what anyone tells you; I am living proof.
If I can do it, anyone can. I really believe that. Believe it yourself. Take
advantage of everything we have to offer at the Academy. Take advantage
of our knowledge. Make goals– set them and do them. Move forward.
We are excited that you are on this journey with us. We are excited for the
journey you are about to embark on. Be positive about it and have a joyful
journey.
Tuesday, January 27, 2009
Friday, January 23, 2009
Partnerships: To be or not to be
The last thing we want to talk about in investor dilemma is partnerships.
The reason I bring up partnerships is this: Many people start investing in
real estate and they say, “You know what? I’m going to form a partnership
because I need some help.”
When you get into real estate, you are going to have many different types
of partnerships. Some projects are simply too big to handle alone, and that
is when you need to bring in additional staff and resources. Partnerships in
and of themselves are not good or bad. Let me explain. At least once a
week someone comes to my office looking for advice to form a
partnership. It may be a partnership between a father and a son. I often ask
why they are forming a partnership. A typical answer is, “Well, I want to
help my son out. I want to help him become successful.” Okay, fantastic!
But are you successful? Well if the father is not successful, it’s probably
not a smart partnership.
Many people form partnerships on the simple grounds of “Hey, this is my
buddy, and I would love to see him be successful with me.” The number
one thing you have to remember with partnerships is this: never drag
someone along with you. A partner is either going to walk side-by-side
with you or he/she shouldn’t come on the journey... period! Partners
shouldn’t ride on your back; they shouldn’t be dragged along. They
shouldn’t be part of the ride unless they are contributing side-by-side with
you. That’s difficult to understand when you are looking at partnerships,
especially when you bring in family. And you hear of this all the time; but
when it happens, partnerships fail.
Working with family is rarely a good thing. Everyone starts out with good
intentions. “Oh, we want to help out. We want to help our little brother
Johnny become responsible and to grow up a little bit.” That is theabsolutely worst reason to form a partnership. When you are searching for
a partner, you need someone who compliments your strengths and fills in
your weaknesses.
My current partnerships are based on competency. I have a partner by the
name of Trond. He fills in my weaknesses and compliments my strengths.
I do the same for him. I have another partner, Frantz. He is extremely
organized and proactive. Nothing can stop the guy... he is absolutely
dependable.
My partnerships have been fantastic; everybody contributes. They have all
been part of a fair partnership from the beginning. Understanding
partnerships is critical to you and your partner’s success. The only reason
why I bring up partnerships regarding investor dilemma is because in real
estate partnerships come into play all the time.
If you are going to form a partnership, be honest with yourself. Ask
yourself, “Is this person really going to help or am I dragging him/her
along?” What does each partner bring to the table? This is where you need
to look at the strengths and weaknesses of each partner and see if they
compliment each other. Also, remember the partnership needs to add
value, just like everything else in investing. In certain types of real estate
investing, like when working in large volume, you will need a partnership
to get off the ground.
Monday we will talk about what happens for when you have a bad partnership?
The reason I bring up partnerships is this: Many people start investing in
real estate and they say, “You know what? I’m going to form a partnership
because I need some help.”
When you get into real estate, you are going to have many different types
of partnerships. Some projects are simply too big to handle alone, and that
is when you need to bring in additional staff and resources. Partnerships in
and of themselves are not good or bad. Let me explain. At least once a
week someone comes to my office looking for advice to form a
partnership. It may be a partnership between a father and a son. I often ask
why they are forming a partnership. A typical answer is, “Well, I want to
help my son out. I want to help him become successful.” Okay, fantastic!
But are you successful? Well if the father is not successful, it’s probably
not a smart partnership.
Many people form partnerships on the simple grounds of “Hey, this is my
buddy, and I would love to see him be successful with me.” The number
one thing you have to remember with partnerships is this: never drag
someone along with you. A partner is either going to walk side-by-side
with you or he/she shouldn’t come on the journey... period! Partners
shouldn’t ride on your back; they shouldn’t be dragged along. They
shouldn’t be part of the ride unless they are contributing side-by-side with
you. That’s difficult to understand when you are looking at partnerships,
especially when you bring in family. And you hear of this all the time; but
when it happens, partnerships fail.
Working with family is rarely a good thing. Everyone starts out with good
intentions. “Oh, we want to help out. We want to help our little brother
Johnny become responsible and to grow up a little bit.” That is theabsolutely worst reason to form a partnership. When you are searching for
a partner, you need someone who compliments your strengths and fills in
your weaknesses.
My current partnerships are based on competency. I have a partner by the
name of Trond. He fills in my weaknesses and compliments my strengths.
I do the same for him. I have another partner, Frantz. He is extremely
organized and proactive. Nothing can stop the guy... he is absolutely
dependable.
My partnerships have been fantastic; everybody contributes. They have all
been part of a fair partnership from the beginning. Understanding
partnerships is critical to you and your partner’s success. The only reason
why I bring up partnerships regarding investor dilemma is because in real
estate partnerships come into play all the time.
If you are going to form a partnership, be honest with yourself. Ask
yourself, “Is this person really going to help or am I dragging him/her
along?” What does each partner bring to the table? This is where you need
to look at the strengths and weaknesses of each partner and see if they
compliment each other. Also, remember the partnership needs to add
value, just like everything else in investing. In certain types of real estate
investing, like when working in large volume, you will need a partnership
to get off the ground.
Monday we will talk about what happens for when you have a bad partnership?
Thursday, January 22, 2009
INFLUENCES AND ATTITUDE, con't
Let me give you one more example... another example using my father-inlaw.
He is a very good person; in fact we get along fantastically. Back in
those early days he was just a father and was cautious; he did not want us
to get hurt. When I first married, I told my wife, “I want to invest in real
estate. I want to do this.” My wife is fantastic; she supports me and is
definitely not the negative influence that is so often prevalent. She said,
“That’s great.” Again, she comes from a traditional family, so she stated,
“You know what? My father would love it if you would take him along.
He knows a lot about construction and different things.” I said, “Great! I’ll
take him along.”
Well, I started bringing him along to the potential properties, and he would
talk me out of every one. I finally realized what he was doing and I went
to my wife. I said, “Honey, I’m sorry, but I cannot involve your father in
this anymore.” She said, “Why?” My response: “Well, he’s talking us out
of every single investment. I cannot do it.” She said, “Okay, fine.” So, we
found a deal by ourselves.
About a week before I was going to close on the deal, I said to my fatherin-
law, “We are going to buy this property.” He said, “Oh, really?” I said,
“Yes, we are closing in a week.” Then he went silent. I asked him if he
would like to see it and he said that he would. He looked at the property
and went through it, not saying too much. He knew my mind was made up
and that I would do it, regardless.
We put together a deal and purchased the property. It was fantastic. I made
$40,000 the first year-and-a-half with no money down. When I was
working at the bank making $9 an hour, I barely had any credit and
struggled to make a $65/month ring payment. We bought that property and
made $40,000 in 18 months. It was fantastic! Now the tables are turned.
My father-in-law is all about being positive. Why? Because he saw a
success story and that’s important. Had I listened to the outside influences
and negativity, I would not be here today. I would not have made millions
of dollars in real estate, nor would I be facing a multi-million dollar future.
I remember my own father. Why did he work six days a week, drive
exhausted, and sleep in his car to see his children? What motivated him?
The love that he had for us was greater than anything else he wanted in his
life. If you can find that core motivation, you can drown out the outside
influences and move forward.
He is a very good person; in fact we get along fantastically. Back in
those early days he was just a father and was cautious; he did not want us
to get hurt. When I first married, I told my wife, “I want to invest in real
estate. I want to do this.” My wife is fantastic; she supports me and is
definitely not the negative influence that is so often prevalent. She said,
“That’s great.” Again, she comes from a traditional family, so she stated,
“You know what? My father would love it if you would take him along.
He knows a lot about construction and different things.” I said, “Great! I’ll
take him along.”
Well, I started bringing him along to the potential properties, and he would
talk me out of every one. I finally realized what he was doing and I went
to my wife. I said, “Honey, I’m sorry, but I cannot involve your father in
this anymore.” She said, “Why?” My response: “Well, he’s talking us out
of every single investment. I cannot do it.” She said, “Okay, fine.” So, we
found a deal by ourselves.
About a week before I was going to close on the deal, I said to my fatherin-
law, “We are going to buy this property.” He said, “Oh, really?” I said,
“Yes, we are closing in a week.” Then he went silent. I asked him if he
would like to see it and he said that he would. He looked at the property
and went through it, not saying too much. He knew my mind was made up
and that I would do it, regardless.
We put together a deal and purchased the property. It was fantastic. I made
$40,000 the first year-and-a-half with no money down. When I was
working at the bank making $9 an hour, I barely had any credit and
struggled to make a $65/month ring payment. We bought that property and
made $40,000 in 18 months. It was fantastic! Now the tables are turned.
My father-in-law is all about being positive. Why? Because he saw a
success story and that’s important. Had I listened to the outside influences
and negativity, I would not be here today. I would not have made millions
of dollars in real estate, nor would I be facing a multi-million dollar future.
I remember my own father. Why did he work six days a week, drive
exhausted, and sleep in his car to see his children? What motivated him?
The love that he had for us was greater than anything else he wanted in his
life. If you can find that core motivation, you can drown out the outside
influences and move forward.
Wednesday, January 21, 2009
OUTSIDE INFLUENCES AND A POSITIVE ATTITUDE
The biggest problem with investor dilemma is the outside influence. What
do I mean by outside influence? I own a real estate brokerage with about
200 agents, making it a rather large firm. I had one of my real estate agents
come into my office (he seemed to be negative by nature). He sat down
and here’s how our conversation went:
He said, “I want to be successful in real estate.” I said, “Great! You can be
successful in real estate.” He said, “Will you teach me?” I said, “Sure! I’ll
teach you how to do it. I’ll teach you how to make a lot of money and turn
real estate into your career.”
This is what I told him he needed to do: Any time people ever talk about
anything in their lives, be happy for them. Tell them:
• That’s fantastic.
• I’m so glad you are doing that.
• I’m so glad you are going to go do that.
• You want to buy a house... great!
• That’s awesome... the best thing to do.
• Good for you!
• You want to invest in real estate? Awesome!
Be positive! I told him, “People need positive energy and they need
positive people around them.”
We get bombarded daily by negative people and negative things constantly
telling us, “You can’t do it! You are not good enough!” Even now, they
may be saying, “Why did you buy that program? I cannot believe you
wasted that kind of money and bought that program! Unbelievable! You
are not going to do anything with it!” You may have already heard it.
I told my agent, “If you can change that... if you can be the positive one,
that alone will bring you success in real estate.”
You can guess the outcome!
The man in question changed his attitude. He was happier all the time. He
would tell people, “Yes! That is great!” After about a month he started
getting business. Soon after, he came into my office and said, “Aaron, this
is fantastic!” I said, “Great! What happened?” His joyous response was,
“You were absolutely right! I’m positive. I started telling people they are
doing great and they refer business to me. Or they contact me directly to
do business with me. Or they wish they would have done business with
me. Now I’m busy and I’m making good money.”
It was all because he was positive... and he was not in a great situation at
the time, either. He was strapped financially and was living paycheck to
paycheck. He was doing real estate part time to make a change, so he
didn’t have a lot of hope for success. However, by changing his attitude
and not allowing the outside pressures to influence him, he became
successful, drawing only successful people to do business with him. Oh,
and by the way, he did not ask one single person for business, yet he
became highly successful.
I tell people that investor dilemma is any outside negative influence. You
need to push that away; you need to push it aside; you need to move
forward and do what you want no matter what. Despite what people tell you, despite the objections, despite the negativity you will encounter, you
can do it.
do I mean by outside influence? I own a real estate brokerage with about
200 agents, making it a rather large firm. I had one of my real estate agents
come into my office (he seemed to be negative by nature). He sat down
and here’s how our conversation went:
He said, “I want to be successful in real estate.” I said, “Great! You can be
successful in real estate.” He said, “Will you teach me?” I said, “Sure! I’ll
teach you how to do it. I’ll teach you how to make a lot of money and turn
real estate into your career.”
This is what I told him he needed to do: Any time people ever talk about
anything in their lives, be happy for them. Tell them:
• That’s fantastic.
• I’m so glad you are doing that.
• I’m so glad you are going to go do that.
• You want to buy a house... great!
• That’s awesome... the best thing to do.
• Good for you!
• You want to invest in real estate? Awesome!
Be positive! I told him, “People need positive energy and they need
positive people around them.”
We get bombarded daily by negative people and negative things constantly
telling us, “You can’t do it! You are not good enough!” Even now, they
may be saying, “Why did you buy that program? I cannot believe you
wasted that kind of money and bought that program! Unbelievable! You
are not going to do anything with it!” You may have already heard it.
I told my agent, “If you can change that... if you can be the positive one,
that alone will bring you success in real estate.”
You can guess the outcome!
The man in question changed his attitude. He was happier all the time. He
would tell people, “Yes! That is great!” After about a month he started
getting business. Soon after, he came into my office and said, “Aaron, this
is fantastic!” I said, “Great! What happened?” His joyous response was,
“You were absolutely right! I’m positive. I started telling people they are
doing great and they refer business to me. Or they contact me directly to
do business with me. Or they wish they would have done business with
me. Now I’m busy and I’m making good money.”
It was all because he was positive... and he was not in a great situation at
the time, either. He was strapped financially and was living paycheck to
paycheck. He was doing real estate part time to make a change, so he
didn’t have a lot of hope for success. However, by changing his attitude
and not allowing the outside pressures to influence him, he became
successful, drawing only successful people to do business with him. Oh,
and by the way, he did not ask one single person for business, yet he
became highly successful.
I tell people that investor dilemma is any outside negative influence. You
need to push that away; you need to push it aside; you need to move
forward and do what you want no matter what. Despite what people tell you, despite the objections, despite the negativity you will encounter, you
can do it.
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