#041: Funding Equals Freedom Series – Part 9

Welcome to The Accelerated Investor Podcast with Josh Cantwell, if you love entrepreneurship and investing in real estate then you are in the right place. Josh is the CEO of Freeland Ventures Real Estate Private Equity and has personally invested in well over 500 properties all across the country. He’s also made hundreds of private lender loans and owns over 1,000 units of apartments. Josh is an expert at raising private money for deals and he prides himself on never having had a boss in his entire adult life. Josh and his team also mentor investors and entrepreneurs from all over the world. He doesn’t dream about doing deals, he actually does them and so do his listeners and students. Now sit back, listen, learn, and accelerate your business, your life, and you’re investing with The Accelerated Investor Podcast.

Hey, welcome back to Accelerated Investor, Josh Cantwell here with you again and I am really excited because we’re kind of rounding third heading home. We’ve been recording these podcasts and solo cast to train you up on raising and recruiting private money. I hope by now one we’ve just delivered a ton of value to you through our Accelerated Investor community. Our goal is to give and give back and give you value that’s going to help you with your investing, help you with advancing your private money, your private capital, and also allow you to build a bigger portfolio of investment opportunities and apartments and flicks and flips and stuff like that. And if you’re not a real estate investor, maybe you’re a passive investor, maybe you’re a small investor, maybe you own an econ company, you know, there’s definitely some tips and tricks in here that you can use inside of your other businesses to raise money and also make really smart passive investments.

We are now into part number nine of this solo cast to series about how to get all the funding you need for all the deals you want and you know, get all the capital that you need. So whether you’re an active investor, a passive investor, there’s definitely a lot of tips in here that you can use to make really good investments in the market. We are also on step number five. There’s five mini steps. So step number one was craft your irresistible offer. We covered that in step number one, which was episode number five. Then we talked about identifying your ideal investor, your ideal avatar, that was step number two. Then we identify and said, well where can we go to, you know, I meet up with and see and meet more of our ideal avatar.

Like where are the places that they hang out and the places they go? And then step number four was to craft a multi-media marketing approach, a multi-media marketing approach. And what would that look like for you to deploy that and to find people and then you know, be the top of mind reference for those people. When they think about real estate, they think of you and they think of active investing, passive investing, fix and flips, apartments, private lending, small balance, commercial, whatever it is they think of you. This particular episode is the fifth step, episode number nine, which is follow a proven follow up process. You can call it a sales process. You can call it a follow up process. For me, it’s a follow up process because I don’t really believe this is a sale. We’re not selling anything. This is, we’re all about educating, educating the marketplace about what we’re doing and it requires quite a bit of follow up.

So I’ve taken our steps in this last step, this kind of sub bullet points, kind of written them down. I have them here in front of me and I’m going to walk you through them exactly what we do and the exact steps that they are. You can follow this word for word, literally step by step, bullet by bullet if you want, or craft your own. But to me it proven follow up process looks like this. Okay, let’s assume that we know our ideal avatar. We have our ideal investor, we have our irresistible offer, we go to events, we meet people, we’re collecting business cards, we’re making relationships. Now we need to follow a proven follow up process, really drive that home, really drive that process home. So the first thing we do, so this is sort of step five A, if you will follow a proven follow up process, which is step five. Five A is what we do is we set up a GoToWebinar go to meeting appointment and in fact we call it a fact finding appointment and we set up the GoToWebinar.

They hop on. Now the reason why we do a GoToWebinars, I’ve found that when I do simply a cell phone call with a potential investor that they often miss the appointment, they skip the appointment, they forget about it. When we send them a go to meeting link with a specific date and time, it could be a Zoom link, whatever conference line, bridge line you want to use. We send it to them. All of a sudden they think, oh, okay, this is a little bit more serious because I have a bridge line. I have a conference line with a username and a password. I can log in. Now we don’t do a screen share, but we do just the video or just audio and I just ask them a bunch of questions. I have a specific script of questions that I ask starts with basic things like, hey, case we get disconnected.

What’s your first name and your last name, your email, your phone number, and your physical address. Do you have a website? I collect all that data, okay. Then I jump into a series of questions, which I know that I need to know per the Securities and Exchange Commission. I start asking them questions, questions like, hey, tell me a little bit more about your investing. Are you an active investor in real estate or a passive investor? And I wait for an answer. How long have you been investing in real estate as an active investor or a passive investor? Wait for answer, okay. Now, before I go through this whole script, I’ve got to preface this with one thing. When they get on the phone, when the passive investor gets on the phone, they’re probably expecting you to just pitch them. They’re probably expecting you to say, hey, here’s my offer.

It’s, you know, 15% return, or it’s 8% pref and you get this amount of equity and this amount of cashflow. Timeout. Don’t do that. Do not do that one because you have to have a prior substantial relationship with them according to the SEC. And number two, the faster you go, the less chance that they’re going to invest. The faster you go, the less money they’re going to invest. You need to go slow and as you go slow, if you slow roll it they’ll invest more money. They’ll invest more often because they’re going to build a relationship with you. They’re going to know you, like you and trust you. So what I do when I hop on the phone with them for the first time. They are expecting the pitch. I don’t go down the pitch route at all. And what I say is, this is almost exactly what I say.

I say, listen, if it’s okay with you, the SEC requires us to have a prior substantial relationship before I make you an offer. Now you know I’m in real estate. You know I recruit and raise private money, but in order for us to follow the rules and be compliant, the SEC wants me to have a prior substantial existing relationship with you before I make you an offer. So if it’s okay with you, I’d like to just stay with the law and be compliant. So this first meeting with you really is about me getting to know about your investing strategy and build a relationship with you. So if it’s okay with you, I’ve got about 10 or 12 questions that I want to ask you specifically about you, your investing history, about your family, about your background. I’m going to ask you these questions because if you decide to invest with me today and you wanted to cut me a check for a half a million dollars, I can’t even legally take it.

So if it’s okay with you, let’s just work on our relationship. Like, you just ask me questions. I’ll ask you questions. I’ve got some specific questions that I’d like to talk to you about and because now we’ve, okay, so timeout from that little script. Now that we’ve removed the fact that I’m not going to make them an offer, guess what? Everybody’s level of anxiety goes down. Everybody’s level of like, is he going to pitch me? Is he going to sell me? That disappears and they can do it and can just be open and honest now, okay. What I found is the faster I go through this, the less money I recruit, the faster I go through it, the less money I raise, the less the relationship is there. So I would rather take my time, go slow and build a massive relationship an amazing relationship because it’s just more fun that way anyway, and they invest more with me longterm, I could provide more value, okay.

So I say that first and then I start going into the questions. So again, tell me your first name, last name, email, phone, physical address. Great. Hey, are you married? Yep. Great married. Great. Wait for answer. How long have you been married? Great. Wait for answer and tell me a little bit more about your spouse. Are they involved in your investing decisions? Wait for answer. Do you have kids? Great. Oh, fantastic. Where do they go to school? How old are they? Wait for answer. Just normal conversation, right? All right then I’m going to get into some things like a little more specific about investing. So again, I always like to kind of open up the real estate specific conversation by saying, Hey are you an active investor or a passive investor or both, okay? Because that’s going to help me understand.

Do they do active fix and flips? Do they actively invest in apartments? Are they an operator or they just a passive investor or are they both? I find a lot of people are both. Then I’m going to go into the questions of, hey, well, as a passive investor, are you more interested in principle preservation and more interested in preserving your principle with getting a lower return? Are you willing to sacrifice some of your return to preserve your principle or are you over here in group B, bucket B, which is you’re comfortable with making investments that are little bit more risky, a little bit more volatility, get a higher return, but might be sacrificing some of your principle? You might lose your principal from time to time. Are you more A or more B?

And then I just wait for answer and then I’ll ask them using the tease please and seize that I learned from Kevin Harrington from As Seen on TV and from Shark Tank. And I’ll say, well, what if you could have both, okay? And they’ll be like, oh, great. How does that work? Be like, we’ll get there. It works great. But we can’t cover that yet. So I’m teasing just a little bit. Okay. So this fact finding appointment, I’m going to continue asking them questions like, hey, are you accredited? Do you know what the, what that means to be accredited? And there are a lot of people say, well, no I don’t know what that means. And then I’ll explain, you know, if you’re accredited, that means you have $1 million net worth excluding your personal residence or you have a $300,000 annual income if you’re married with a reasonable expectation for the, you know, to have a $300,000 income this year and $300,000 income for the past two years, or if you’re single $200,000 annual income for the past two years with a reasonable expectation for that to continue next year. That makes you accredited.

If you’re any one of those three buckets, so are you accredited or not? And again, wait for answer, then I’ll ask them things like, have you invested in the stock market before? Tell me about your stock market experience. Normally I have very few people who say, yeah, I’ve invested in the stock market and I became a millionaire investing in stocks. That never freaking happens. I’m sorry it never happens. People say, yeah man, the market goes up and down, up and down, up and down. It’s very volatile and it makes me nervous. That’s the most common response that I hear. Then I’ll ask them, well, have you invested in any alternative investments? You know, after I get past the stocks, bonds, mutual funds, typical investments, you know, average investments. Like have you done any alternate investments you’ve invested in real estate, oil and gas, cannabis, crypto? Have you invested in private placements?

Have you done anything? That’s what’s called and considered an alternate investment? And then I just wait for answer. And a lot of times this opens up a massive can of worms where they just, they talk about lots of different things and then I just, you know, I let that go kind of down whatever path that goes. If they want to talk about oil and gas, they want to talk about a deal they did, they want to talk about a deal they lost money. And I just asked how, tell me more about that. Tell me more about that. Tell me more about that. By the way, if you want to have a great relationship with your wife, if you’re a dude listening to this, make sure when you talk with your wife, ask her questions and then just say the words, hey, tell me more about that.

And they’ll talk and they’ll talk and they’ll talk and keep going and going. And tell me more about that. You know where I got that tip from Jack Canfield. I was interviewing Jack for this podcast a couple of years ago, and Jack told me that once a week he has like a whole day, like not a date night, but a date day with his wife. And he’s learned, you know, he’s in his seventies, had a very successful business and a successful marriage, you know, and he just says to his wife over and over. Yeah, honey, tell me more about that. Tell me more about that. I thought that was great. Just be a good listener, man. You can be a great husband by being a great listener. Women love to talk scientifically proven to be four times more than men, by the way. So anyway, we’re doing this fact finding appointment and we’re asking lots of questions.

So, you know, we get down to the point where at the end vast all these questions and I’m not going to cover them all on this podcast. I’ve got other training programs, you know, that we cover every single detail, the podcast, I try to keep it a little bit high level, but fact finding appointment at the end I say, great, listen, really feel great about, you know, building a relationship with you and I’m excited for this, I’m excited to get to know you a lot of great things I’ve learned about you. Here’s what I would suggest we do next. Why don’t we get back on the phone next week, same time back on GoToWebinar. Between now and then you’ll probably come up with some more questions. I’ll come up with some more questions and let’s just have another sort of, you know, fact finding appointment, answer some frequently asked questions and we’ll take it from there.

In the meantime, I’m going to shoot you an email with a couple things. I’ll shoot you some links to my press kit. My website, my podcasts. I’ll send you a one page bio and some links to download one of my digital books. Okay, so that’s again, step five A is the fact finding appointment. Step five B is to now follow up immediately after the interview is over. The fact finding appointment is over and I email this stuff. I have this preset in a macro response, email it out to them. Bang. Now week later again, my assistant sends out the link. Same time, same place. Let’s say it’s Thursday at 4:00 o’clock and now five C okay. Is I’m doing basically another fact finding appointment, building the relationship. And here I might talk about some of my past deals. I’ll talk about how you know, I did this deal a year ago, two years ago.

We bought it for $150,000 rehab the for $50,000, we’re all into it for 200. We sold it for $300,000. And on that past deal we paid our investor 12% interest or 15% of the profit, whichever was greater. Now that deal is not available to invest in, but that’s how we structured that past deal. Okay, so now step five C is, I’m having this, the next GoToMeeting appointment against high level, no screen share. Just a lot of questions. They’re coming to me with questions. I’m asking them additional questions. I’m asking them now things like, do they have a financial advisor? Do they have an attorney, an accountant, a lawyer, you know, a CPA, whatever, a friend that helps them make financial decisions. Because I want to know if I’m going to bump into somebody that’s going to impact their decision making, okay.

So five C is a week later I’m having this next fact finding appointment. I’m saying great, fantastic. At the end of that same thing, hey, you know, the SEC requires that we have an existing substantial prior relationship. You know, we’re one step closer. Why don’t we get on the phone next week, same time, same place and meet again. And so we’ll say, great, you know, great to meet you, great to talk to you some more and build the relationship. And then I tell them, hey, step five D, okay, is that now I’m going to mail them out physical packages stuff. Maybe if you have a book with a letter, maybe you mail them a copy of Tony Robbins book Unshakeable, which I think is a great resource. You mail them out some swag about your company, like pens, stickers, maybe you know, you know, maybe a Yeti mug, whatever, you know, mail it out to them. So I do that between appointment number two and appointment number three, okay.

Then a week later, again, I try to stick with the same time Thursday at 4:00 o’clock, Tuesday at 2:00 o’clock, same time last week, same time this week still. So step five E is that now we have our third meeting and now this is going to be again at the beginning, we’re going to be going through again, frequently asked questions, we’re talking to them about questions they have about real estate questions they have about our deals, a little bit more about them. And now we have a pretty substantial relationship now. We’ve spent probably three hours on the phone with them. I know all about their family, their wife, their kids, their financial advisors, deals they’ve invested in the past. Now we have a really substantial relationship. Now step number three, or I’m sorry, this is the third meeting. This is step five E is the pitch and now I’m going to do a full GoToMeeting with a screenshare.

I’m going to show my webcam and I’m going to show my Power Point pitch deck, okay. So now I go through the offer, whether it’s apartments, whether it’s self storage, whether it’s equity in a deal, whether it’s investing in your business, whether it’s a private money loan, you know, whatever that is. I’m going to walk them through the pitch deck and that probably takes me 30 minutes because now I can, I can kind of talk turkey. I have a substantial prior relationship and I can talk turkey with them. Okay, so go through that, it creates questions. Now what I tell them at the end is, look, I’ve gone through this whole presentation and I just educating them on how real estate works. We buy properties at wholesale prices. We want to be all in at 65 to 70 cents on the dollar. If somebody invests with me, this is how the interest gets paid, this is how the equity gets paid, this is what we want the after repair value to be.

I’ve walked through a bunch of case studies. Then at the end I say, well look, you know, I’m not assuming that you’re interested in investing. But now that we’ve covered the entire full presentation what I thought we would do is meet again next week. So now this is meeting number four, the fourth week and now, and we’re going to just follow up, right? So again, I’m not asking them for any money. I’m not asking them to invest and just taking their temperature. Are they interested? Is this something that they think is cool? And by now they’re going to open up, they’re going to say things like, yeah, this sounds great. You know, I’ve got $150,000 I’ve got $500,000 I got $1 million bucks, I’ve got whatever. And you know, this looks like something that might work for me. And I’ll ask them more questions like, hey, you’re going to invest with cash, or you think you might be invest with your self directed IRA?

You know, where’s the money going to come from? Is there anybody else that’s going to help you make this decision? That kind of thing, right? But I’m still not asking them for money. So next week comes around. Now between meeting three and meeting four, I’m going to send out the private placement memorandum, my disclosure document, my offering memorandum, whatever that looks like with the risks, the upside, the downside, the use of proceeds, etc. etc. I’m going to send that out to them between meeting number three and meeting number four, they’re going to get it all. Now the next step is we have meeting number four, let’s say again, Thursday at 4:00 o’clock. Same time, same place back on GoToMeeting. Now this is essentially the close and commitment all right. So my whole staff follows this process, close and commitment. So now it’s like, okay, let me ask you a question and this is what I consider the close.

If I found a deal that looked like this, this is the question that I’m asking. If I found a deal that we were all in for 65, 70 cents on the dollar, you could get 12% interest or 15% of the profit. We’re going to flip this house in about four to eight months. It could be as long as a year. If I found a deal like this and I needed $200,000 to fund the deal, is this something you’re interested in? Are you interested in getting 12% interest for 15% of the profits, whichever is greater? And I’m going to wait for answer, okay. That’s the closing commitment. Now, I don’t even have a deal yet. I’m not presenting them an actual deal to invest in. This is all based on theory. It’s all based on the, if come, I’m going to have a deal that’s coming up, okay. And they say, yeah, you know, if you find a deal that looks like this or you know, let’s say it’s an apartment, you find a $10 million apartment deal and I can earn, you know, 10% preferred return and equity and cashflow and perpetuity, I’m in.

Or I’ve, you know, I’ve got $200,000 if you find something like that, okay, great. Now, okay, that’s meeting number four. Now after that they’ve got the PPM, we’ve made them the offer, okay. They have a general idea of a deal. Now meeting number five, which is the next week, same time, same place. I’m going to bring them a specific opportunity to invest in specific apartment specific rental, a specific rehab, a specific whatever, okay. And I’m also, if I can structure it in time, I’m also going to send them copies of my note mortgage or I’m going to send them copies of an operating agreement. That’s a template. It’s not official. It’s a template with their name on it so they can see and feel what it’s going to look like when they invest, okay. What does a note look like? What does a mortgage look like?

What does the operating agreement look like? What do you know, what does that all look like? And so after meeting number five, they have the private placement. We have a substantial relationship. They have copies of the documents of what they would potentially look like in a template if they decide to invest. And now meeting number five, I’m bringing them an official deal to invest in because by now I want them to be like a rabid dog. I want them to be foaming at the mouth to fund our deal. I want them foaming at the mouth, jumping, they’re excited. And now we’ve got to start working on the rollovers, right? So if they’re in a 401k, if they’re in an old IRA, they’ve got to do the transfer, the rollover, we’re going to help them get the documents filled out to roll the money over to Horizon Trust.

We use Horizon Trust. If you want more information about getting a self directed IRA account, check out HorizonTrust.com/SREC and there’s a, an opportunity to get a free strategy session there. So we work with our client to roll the money over. If it’s a self directed IRA, if it’s cash, then we’ll just start working with them on getting their cash ready, right? So then the last couple of steps is that we put the subscription agreement. The subscription agreement is the actual investor questionnaire and it is the investor questionnaire and their stock certificate. So we send it out to them in a docusign. They date stamp it, they timestamp it, they sign it digitally, then it comes back to us, we countersign it and then that is their proof of their investment in our deal. And then the subscription agreement is complete and they wired the money in.

If the money’s going to self directed IRA, we’ve got a send off the subscription agreement in the direction of investment form to their self directed IRA company. Finally the money arrives and then we send out a welcome packet. Okay. A welcome packet goes out to them, welcoming them to the investment. They get copies of the private placement, copies of the subscription agreement, copies of the note and mortgage or whatever the whatever they invested in the operating agreement, copies of the investment summary, copies of the financing package, a cover letter, all that stuff. And then we’re done, okay. So that many sort of steps within step number five is actually 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14 steps within step number five might sound like a lot, but it’s only worked for me to raise $30 to $35 million bucks.

And so I really feel like this is absolutely the path to go. I’ve tested so many different conversations, so many different ways to work with people. You know, I’ve failed many times. I’ve pitched way too soon, way too late. You know, it’s just something you massage over the years. We’ve gotten really good at it and this is where the rubber meets the road. This is how you really convince somebody to park money in your deals and invest with you, alright. Now there’s a lot there, there’s a ton of meat there. So if you could believe some comments, some questions, let us know, email the office, visit our website, let us know if you have questions around this.

And you know, we’ll definitely help you out. And you know, if you’d like some more information about coaching, a lot of people when they hear about this, they’re like, wow, this is a lot but man funding equals freedom. I need some coaching around this. I need to know how this works. I got to do this in my own business. If that’s something that you feel like you need, go to Josh CantwellCoaching.com apply there for our coaching program. We’ll be happy to train you up in the exact systems we’ve used, um, you know, to build $100 million portfolio and recruit and raise over $30 to $35 million bucks. So I hope you enjoyed this process. We’ve got one more call in our series that’s coming up next.

You’ve been listening to Josh Cantwell and the Accelerated Investor Podcast. Leave a comment on our iTunes channel and let us know what you want to learn next, or who you’d like Josh to interview. While you’re there, give us some five star rating and make sure to subscribe so you can be the first to hear new episodes. Follow Josh Cantwell and his companies, the Strategic Real Estate Coach and Freeland Ventures on all social media platforms now and stay up to date on new training and investment opportunities to start your journey toward the lifestyle you’ve always dreamed of. Apply for coaching at JoshCantwellCoaching.com.


Congrats! If you’ve established relationships with several potential private lenders, you’re well on your way to financial freedom. (If not, be sure to tune in to the previous parts in this “Funding Equals Freedom” series.)

Now, it’s time to pull the trigger and secure the funding you need for your investment properties. In this podcast, Josh Cantwell discusses step #5 of his process for raising private capital: implementing a proven 14-step follow-up process with each potential private lender. 

Now, 14 steps may sound overwhelming. But keep this in mind: your private investors are considering whether they should entrust you with a significant portion of their wealth. A HIGHLY detailed process is crucial, if you want to earn their trust and their finances. 

The good news? Josh is here to walk you, step by step, through the follow-up process – covering every tiny detail. He’ll share his specific strategies, how he structures his webinar “fact-finding” appointments with potential investors, and how he educates the investor. 

This podcast is jam-packed with extremely helpful details that you can’t miss. If you want to REALLY convince someone to invest with you, and ultimately boost your real estate investing business, be sure to tune in. 

What’s Inside:

  • The crucial parts of a proven 14-step follow-up process that you should implement with private lenders you’ve connected with
  • Why you should schedule GoToWebinar “fact-finding” appointments with potential lenders, instead of basic phone calls
  • How to structure your fact-finding webinars with a private lender
  • Specific questions to ask the private lender during the fact-finding webinars 
  • How to eliminate anxiety for yourself and the private lender 
  • How to structure “the pitch” during your third GoToWebinar meeting 
  • Additional follow up steps to strengthen the relationship and seal the deal 
  • How to handle the money transfer 

Mentioned in this episode​