Josh Cantwell: So, hey, there, welcome back to Accelerated Investor. I’m your host, Josh Cantwell. And today, we’re going to talk about raising big, big money. I’ve invited a relatively new friend onto the show today. His name is Brad Blazar. He’s a highly sought-after speaker on the subject of raising capital. He’s raised over $2 billion. And today, he mentors investors around the world doing live events, training events to help them raise significant amounts of money.

I’m not going to do a long-winded intro here because this is a subject and a topic that we’re going to talk about today that we have really never talked about before on other shows. And that’s the idea of leveraging broker-dealers and registered investment advisors, leveraging them and their relationships to help you fill up a $50 million, $100 million, $500 million raised. So, if you’re an advanced commercial investor and you already own $50 million, $100 million, $250 million worth of real estate, this is the show for you to learn how to go buy your next $100 million asset and exactly learn how to leverage these broker-dealers, registered investment advisors to help you fill your capital stack.

My guest again is Brad Blazar. He is the author of a book called Winning at the Capital Game. You can get it on Amazon. It’s fantastic. You’re going to love this episode of Accelerated Investor. Here we go.

[INTERVIEW]

Josh Cantwell: So, hey, Brad, listen, thanks for carving out a few minutes and thanks for joining me on Accelerated Investor. We’re excited to have you.

Brad Blazar: I’m glad to be here, man. It’s great to be with you today, Josh.

Josh Cantwell: Awesome stuff. Brad, listen, you have a ton of experience in raising capital from all different kinds of places, but as we kind of introduce you to our audience, what I’d love for you to tell us about is a passion project or something that you’re working on right now, like this week, like tomorrow afternoon, like something very current that you’re working on as we kind of introduce you to our audience. I’d love to hear and learn more about what you’re working on today. And also, why is that important to you? Why are you passionate for it?

Brad Blazar: So, we just came off a bootcamp and we had a bunch of people there. We had actually people that came all the way from England to be in the room. We got people that travel from Australia. And I just said to myself, “Man, if I’ve got people traveling for 20 hours to come to one of my capital raising bootcamps, it’s time we start doing bootcamps in other countries.”

And so, one of the things that we’re really working on this year is to host capital raising bootcamps in other parts of the world. I’m currently working with some of the biggest coaches in Australia now. We’re talking to some of the biggest people over in London. And so, one of our big strategic things for 2023 is to take our mission in terms of what we’re doing here at Capital School and really just blow that up and go ballistic.

I don’t want people to have to travel here. I don’t want people to have what I call a virtual experience with their coach, a mentor. It’s me going there. Let’s put 100 people in a room in Sydney. Let’s get another 100 people over in London, and let’s let people know that Capital School is the largest and most highly respected platform for people around the world that want to learn how to raise capital, but more importantly, do it the right way.

Josh Cantwell: I love it, I love it. We’ll talk about that mission as we kind of go along here in the interview. Brad, tell me a little bit about how raising capital has changed in the past year as interest rates have gone up.

Brad Blazar: Sure.

Josh Cantwell: As the Federal Reserve has made changes, there’s this looming recession. Everybody keeps talking about, although there’s a lot of indicators that we’ll never get there to a recession. There’s a lot of indicators that could be, everyone’s like, this is going to completely blow up or there’ll be no recession at all. Either way, things have changed. How has it changed for you?

Brad Blazar: Well, actually, it’s gotten better. We’re raising a ton of money. I think it’s really a lot of mindset, but it’s also having systems and structures in place. The biggest challenge a lot of people have that go out and try to raise private money or try to get into the family office space is they’re over here at point A and they’re trying to get to point B, and in the middle of that, there’s this huge ocean. It’s what I call the missing systems, the missing structures you really need in order to scale and raise lots of money.

We’re real good at identifying what those are for people. And I tell people, “Look, the JOBS Act in 2012, and also, of course, 2015 loosened the restrictions for entrepreneurs and business owners.” Back when I got started doing this, man, you cannot advertise. You cannot use social media. So, if you understand how to do those things, you can consistently create that wave of what I call attractive potential investment partners.

It’s then, of course, following up, but there’s certainly no doubt about it. Investors today, Josh, are certainly a little bit more cautious. Some of them are sitting on the fence, but I think it’s really being able to add value and explain to people, look, your money is a tool. Your money is doing you absolutely no good sitting in a bank account. Let’s put it to work. Let’s get in this great property. Here’s what that looks like. Let’s talk about some of the tax benefits because at the end of the day, I firmly believe there is no other better investment in the world than owning real estate.

Yeah, it’s tangible. The tax benefits, the leverage, the fact that other people are essentially paying for your asset, while that hopefully is appreciating in value. And it’s really just being able to articulate that to the right person, but it’s understanding also that you need systems and structure to your approach to do this and do it at scale.

Josh Cantwell: I love it, Brad. Now, I know your approach is a little bit different. You’re able to raise over $2 billion because you subscribe to this philosophy that if you want to raise a lot of money, you shouldn’t do it yourself. Talk about that. What do you mean by that?

Brad Blazar: So, I’ve worked for some of the world’s leading financial services firms as the Director of Capital Markets. I’ve worked for some of the leading real estate syndicators in the United States. I mean, these companies manage real estate not in the millions, but in the tens of billions of dollars.

They got where they are because of me. And it’s understanding that if you’re going to go out and raise $2 billion, you don’t raise that by yourself. You get on the platforms of broker-dealers where they have your fund positioned alongside other real estate investment trust. And over time, you create an army of financial advisors that every time they’re sitting down with their retired couple and they’re looking at their portfolio, they have a conversation like, Mr. or Mrs. Cantwell, I see other than your house, you don’t have any other real estate that you own. My brokerage firm has approved this product. It’s a multifamily fund and I’m of the opinion we should put a quarter of a million dollars to work for you. Here’s what that looks like.

And so, now, as a syndicator, you’re sitting back, you’ve got thousands of financial advisors that are having that conversation with clients of the firm every day, and you’re the recipient of all of that capital. I’ve worked for companies that I have literally taken from ground zero to in their first year, they’re raising $150, $200 million plus. We’re not raising the money. We’re not on the phones. No, we built basically a distribution platform through a syndicate, a network of broker-dealers. And that’s how you scale. That’s how you go from raising maybe $100 million to raising $500 million. It’s broker-dealers, registered investment advisory firms in private wealth management companies that do that work for you.

They’re licensed. You can pay the commission. Why? Because they’re a broker-dealer. And so, that’s the world that I’ve played in that has allowed me to do that for a lot of what I call senior companies or companies that have had a track record, but now really want to scale and grow and get to that next level.

Josh Cantwell: Yeah, no doubt, things have changed. When I graduated from college all the way back in 1998, I became a financial planner, financial advisor, got my Series 6, 66, 63, life and health, and there were no real estate products that you could sell to the broker-dealers. I think the JOBS Act changed that, RIAs changed that, where they were able to vet out operators and put their deals on their platforms. That’s changed substantially to the point where now, back in the day, it used to be 70, 30, or 80/20 stocks and bonds.

Now, you meet with a financial planner. A lot of them, they’re schooled in real estate, will do more of maybe a 50, 30, 20, 50% stocks, 30% bonds, 20% real estate, or maybe even a little bit more stock, maybe 60, 20, 20. Tell me about the evolution that you’ve witnessed. How has that happened? Was there specific legislation that you could point to? Was it the JOBS Act? It’s really kind of opened up real estate in more of that financial planning world.

Brad Blazar: I don’t think it’s really that. I think really what it is, Josh, is this theory that a lot of financial advisors, registered reps, basically discuss with clients. And it’s a manner in which we call the endowment theory. If you look at the biggest endowments around the world, Yale, Brown, Harvard University, and you look at their portfolio, they’re like a pie chart. They own private equity, they have some money in energy, oil, and gas. They have some money in real estate. They own equities. They have fixed incomes.

And so, that allows people’s portfolios to be much more predictable because if you’re a retiree and you’re largely made up of a stock and bond portfolio and then you’re five years to retirement and we go into a bear market or we go into recession and your entire net worth has largely been in the FANG stocks, Facebook, Amazon, Netflix, Tesla, dude, you just lost 30%, 40% of your net worth five years pre-retirement. Real estate is a tangible asset class. Sure, it goes through cycles, but when you want to stay on that, some of your investments need to zig. When the others are zagging, you’re going to get much more predictable growth.

And I think the conversation that financial advisors are having with clients today is all around that. Like Mr. or Mrs. Jones, you need some real estate, you need some private equity, you need some oil and gas exposure. And so, these broker-dealers have now evolved over the years to put products on their platform that are now tools for those advisors to work with. It’s simply a matter of understanding the process you have to go through if you’re a syndicator, to now get your product on that platform.

Josh Cantwell: Yeah, I love it. A friend of mine, his name is Chris, is a registered investment advisor, manages about $200 million generally, and I’m on the smaller side, I guess, but we have kids that play volleyball together. And so, volleyball tournaments, he’s like, “Dude, you’ve got to get on our platform. I’ve got to be able to sell into you. I don’t really have a lot of real estate operators or syndicators, products that we can recommend. I could park at least $2 to $5 million in your deals.”

I’ve done a lot of raising capital, raised $100 million, mostly from retail investors, I have to say the more the mom and pops that can stroke checks for $100,000 to a million. What I’m hearing you say is that a guy like Chris or dozens of guys like Chris is really the– it’s the linchpin, it’s the way to go from raising maybe $2 million to $5 million to $10 million for a syndication to raising hundreds of millions. That’s ultimately the message here, is that right?

Brad Blazar: Absolutely. I mean, I’ll give you an example. I’ve worked for companies like Bluerock real estate based out in New York. They have a real estate investment trust that’s publicly traded. I’ve also worked alongside other people like Griffin Capital out of Chicago, Cole Properties out of Arizona. These guys have been at this now a couple of years, and they built the loyalty, they built the trust. But imagine this, they’re raising a billion dollars a year through channel now. That’s just the equity. You know what a billion dollars in equity will allow you to buy? You’re in the real estate business. You 4x, you 5x that because you’re borrowing the other 75% to 80%, which is your debt.

So, when you think about the ability to create a machine where you’re just sitting back and you’re the recipient of hundreds of millions of dollars, or in the case of some of the leading sponsors, a billion dollars in capital that’s now being raised for you by other parties, that’s where you create legacy well. The guy that I used to work with, Ramin Kamfar, at Bluerock real estate, his company today manages about $18 billion in cash or real estate. Others that I’ve worked for, $8 billion, and they got there fairly quickly, 10 to 12 years.

So, you look at people that spend 10 to 12 years in what I call the retail mom and pop. Yeah, you might have $100, $200 million. You’ve done great. You’ve got 4,000 or 5,000 units. Boom. You could be over here with billions. The only difference is the mindset, the knowledge, and the understanding that there is also that ocean to swim in. You just got to find people that understand that space and can get you there and show you the steps to take in order to do it, but more importantly, do it the right way.

One of my clients here in Houston, Makaan Investment’s CEO came to me, said, “Brad, I’ve been following you on social media. I’ve got about $350 million in apartments. I want to be at a billion-dollar valuation in 18 months.” And I said, “Great. You realize you’re not going to get there doing what you’ve done to get you to 350.” He’s like, “That’s why we’re having this conversation.”

So, we introduced him to the proper due diligence firms. We introduced him to a couple of broker-dealers that take on the role of what we call a managing broker-dealer. They lead that effort. Now, he’s going to conferences alongside me where I’m introducing him to other broker-dealers to build that interest to get added to their platforms. And there’s no doubt in my mind, in 12 to 18 months, he’ll be at a billion-dollar valuation. He’s under contract right now to buy a four-asset portfolio for $200 million. That’ll put him at over 550. So, he’s already halfway there.

Josh Cantwell: That’s fantastic stuff. So, not only does it allow you to sort of divide and conquer, in my firm, we’ve got swim lanes. Myself and my two partners would really allow, like me, who does a lot of due diligence, a lot of reviewing deals, but also raising a lot of capital, this would allow me to spend more of my time looking at deals, finding deals, underwriting deals, and offering because I’m not having to spend what’s probably half of my day or half of my month, half of my year talking with investors, right? This would allow me to talk to those registered investment advisors that already have relationships with clients combined. You’re talking about hundreds of millions or billions of dollars in their accounts and allow them to basically invest in my deals, which would allow me to focus on whether it’s operations, CapEx, finding deals, acquisitions, and kind of offloading a lot of the capital management and raising of capital. I love that idea to go from maybe $300 million, $400 million to a billion, allow you to get there so much faster.

Let me ask you, Brad, how do these guys get paid? Everyone on the podcast, its little lessons like, well, how does a registered investment advisor get paid? Obviously, there’s got to be something in it for them.

Brad Blazar: Absolutely. There are two types of individuals working in the financial advisory space. There is a financial advisor, or we call them a registered rep. They’re typically commission driven. So, if they place capital with you in your fund, you’re going to pay a commission. Usually, that commission might be somewhere 5% or 6%. So, on $100,000, they’re making $5,000. Now, obviously, the broker-dealer takes part of that as well. So, there’s a little bit of a haircut.

Over here on the other side of the fence, you have what we call registered investment advisory firms. They do not get paid commissions. They charge their clients what we call an advisory fee. Usually, it’s 1%, 1.5% of the portfolio that they manage, and so, they’re getting paid traditionally by the client. You might build in 1% or 2% in your fund, but a lot of the people that we work with that we help structure their funds, we say, “Why don’t you have two share classes? Have one for the registered rep that gets paid a commission. Have another class of shares for the registered investment advisory firm that does not.”

So, now, net-net, when you look at the overall structure of your fund, you’ve got a blended rate that’s being paid out four commissions, might work out to three or four because you’re not paying five or six to everybody. You’re over here getting money also from registered investment advisory firms. But that’s how they get paid. It’s usually a commission. So, you obviously just factor that into your capital stack as your cost of capital and you figure out, well, if I’ve got to pay 1% to the broker-dealer and the financial advisor is raising all this money for me, you’re getting paid five, my cost of capital to raise from this channel is 6%, 7%. And as you’re doing your underwriting, you just put it right in there.

Josh Cantwell: I love it, I love it. If somebody wanted to do this on their own, obviously, you teach this, you teach this now all over the world, some people might think, well, maybe I know a registered investment advisor. My neighbor, my friend, my brother is a registered investment advisor. Is that something that you would recommend that they try to run that down on their own? Or is this something where a lot of the registered investment advisors, they don’t want to put certain things on their platform? Are there certain things that they’re kind of used to? And so, trying to run it down on your own is kind of like, either a waste of time, you’re kind of barking up the wrong tree. Help me understand that for people that know an RIA or maybe a couple of RIAs of their own, does that make sense to try that? Or is it, hey, you’ve got to get introduced to the right RIAs that are already doing this type of stuff?

Brad Blazar: So, you’ll get shot down and it’ll be a closed door. And here’s the reason. The broker-dealer community is a very litigious industry.

Josh Cantwell: No doubt.

Brad Blazar: Between many sponsors and so many deals blow up, and obviously, they realize if the deal doesn’t go the way it was intended to go, number one, that client may file an arbitration or a lawsuit against the financial advisor that made that investment recommendation. Well, who do you think is also going to be named as defendant? The broker-dealer. You see in the financial services industry, broker-dealers have a fiduciary responsibility and an obligation to oversee the activities of all of their registered reps.

So, it’s become an industry where there are what we call third-party due diligence firms. These traditionally are law firms. There’s typically four or five that cater to that entire space. And what they do, Josh, is they come in, you hire them, and they do a deep dive in a very institutional quality due diligence on you and your company. So, they’re going to look for things like investor relations infrastructure, reporting, transparency. Do you understand the SEC landscape? Do you have accounting?

And then they write what’s called a due diligence report. This is typically about a 50 to 60-page document that you can now take kind of like a pedigree. And now, when you go to a broker-dealer, you can say, “Hey, we have third-party due diligence done by XYZ firm.” That is a name that they respect that opens the door and allows you to now have that discussion with that broker-dealer. They’ll take that, they’ll do their own internal due diligence, and then they initiate what we call the selling agreement. That means we like you, you like us. Let’s now add you to our platform. That’s where it starts.

All that means is the broker-dealer has now added you to their platform. How do you now educate the 300 financial advisors they might have around the country? And that basically entails either you hire a couple of salespeople regionally to call on those advisors or you attend their broker-dealer’s National Sales Conference where you have a booth. Now, you’re in the right room.

So, there’s definitely a process to this, to do it the right way. What I have found, having done this now for 30 years, raising hundreds of millions, is the other “experts and gurus” in this education space. I’ve never done this. I essentially am the only person having raised $2 billion that can hold the hand of people in real estate or in that regard, any other business to get them in those right rooms, to get those introductions made because largely, you can’t teach what you don’t know.

So, we have hundreds of students that are at different levels of success that want to raise money from family offices, want to raise money from sovereign wealth funds, want to learn how to raise money from insurance companies’ pensions. And the great thing about me is I’ve done all of that. So, it doesn’t matter where you are on that capital-raising journey. It’s like, look, if you want to learn how to get into broker-dealers, let’s talk, let me introduce you to those people, and let’s take the steps.

Like my other client here in Houston, to get in the right room, to get that due diligence, to get basically in the right trade associations, where now, you’re positioning yourself and you’re not talking to retail investors, you’re talking to broker-dealers. Different conversation. But again, it’s the registered rep who might want to add you to the platform, cannot do that because the broker-dealer has to approve you first. It’s like a real estate agent. Real estate agent reports to the broker. So, think about that.

Josh Cantwell: Yep, I love it. You’ve mentioned a few times– I love this conversation. This is…

Brad Blazar: Those are big time stuff. This is where everybody wants to be. But unfortunately, most people don’t know how to get there. And I do.

Josh Cantwell: Yeah, I love it, I love it. You mentioned a few times your fund. Does it have to be a fund structure or can it be one-off deals? I mean, you’re talking about RIAs, you’re talking about big broker-dealers. The offering has to be big enough for the broker-dealer to bother, right? So, if you’re just going to raise $2 million, they’re not going to bother, or even $20 million.

Brad Blazar: Let’s back up and let’s look at that. So, the answer is yes, they usually like larger funds. But let’s also forget that the 1031 space is a very active space. A lot of registered reps and planners have built their whole book, the business, just catering to that one niche because they realize those transactions are very big. Hey, I’m a retiring doctor, so my practice. I own the office building and now I sold that. So, I’ve got $3 million and I like to 1031 that so I don’t have to pay capital gains.

Well, in this broker-dealer space, a lot of the sponsors, they’re doing what we call structured deals on single identified assets, but they’re doing it in a DST structure because when you look at the 1031 landscape, there are two basically recognized structures, one is your tenancy in common, the other is a Delaware Statutory Trust. So, what a lot of these sponsors will do is they’ll go out and buy a multifamily asset, they’ll buy an office building, they’ll buy a commercial property, but they’ll structure it for the broker-dealer community as a DST, and it might be a $6 million raise, it might be an $8 million raise.

Broker-dealers love that. Why? Because there’s demand for that type of product. They know the investor has a ticking time bomb because on a 1031, you got to identify your replacement property inside of 45 days. Otherwise, you lose that. So, if you’re an investment sponsor, yes, you can get into the broker-dealer space with a single deal structured the right way to capture those 1035 investment assets.

Will they typically do a small limited partnership for $25 or $50 million? Sure, they will. Because in the broker-dealer community, you have broker-dealers of various scale and sizes. Some of the independent broker-dealers, you got like 12, 15, 20 guys. So, they’re not going to blow out $100 million offering. But can they raise $5 million for you on your $25 million fund? Sure, they can.

Josh Cantwell: Really can.

Brad Blazar: So, obviously, different types of structures. There’s what most of us are familiar with. That’s a Reg D. Usually, it’s a 506(b) if you’re going to bring in non-accredited or 506(c) if you want to advertise. But in that space, there’s also what we call public and private non-traded real estate investment trusts. So, if you want to get in that space, get an attorney, put together a REIT, now you’re offering shares in the trust. Now, if you scale that and get to a significant size, you can do an IPO. Take that REIT through what we call an UPREIT structure. Now, you’re traded on a national exchange.

Josh Cantwell: Incredible stuff. I love it. Brad, listen, there’s so much that we could learn from you. You’ve written…

Brad Blazar: That’s why I love talking about raising capital. I love educating people. I love getting their minds to open up to the possibilities to get out of the pond you’re in and get into the big ocean and swim with the whales because that’s the difference between building a company and getting to a couple hundred million and saying, “Wow, I never knew this stuff. I could be a billion dollars in AUM in two to three years.” You bet you can. And the way to get there is to get these other people to raise that capital for you.

Josh Cantwell: I love it. Now, listen, you weren’t always an expert in this space focused on these large institutions, RIAs, and broker-dealers. You started as a single-family investor, wholesaling, flipping houses, rehabbing. How did you make the pivot? A lot of people will wonder, like, wow, maybe I’m an intermediate kind of residential investor. I would love to do what Brad’s doing. But listen, Brad’s done it. And if Brad’s done it, you could duplicate what he’s accomplished. So, Brad, what was your journey like for you? Tell us about the start.

Brad Blazar: So, I started like a lot of people. I picked my lane. My lane was I became a subject to expert. I didn’t have a lot of money. And I realized, well, geez, I can take over people’s payments that are in pre-foreclosure. And so, I built a portfolio where we had about $4 or $5 million and I became a landlord. And I’m like, man, this sucks. Like, I’ve got a property north of town. I got a property over here. When people are calling me with issues at the property, I’ve got to go over there and meet the contractor or meet the plumber. And I said, there just has to be an easier way.

And so, as we started liquidating out of that single-family portfolio, I started basically investing in larger deals – four-plex, six-plex, eight-plex units, and it just scaled from there. I was still working in the financial services space, raising hundreds of millions for these other syndicators. And I just stepped back one year and I said, “Man, I just raised this dude $200 million.” He was one of the top five self-storage operators in the self-storage space. And I said, “Why am I not raising money for myself?”

And I got this team of great people. We put together a $25 million Reg D and we started like most people, just having conversations with people, hosting investor meetups, following up. And it’s allowed us now to grow in scale, much like you, and we’re at that point now where we’re working with small registered investment advisory firms locally that can help us scale and raise even more capital because there is a difference between what we call RIAs and broker-dealers. RIAs do not have what we call FINRA oversight, which means they’re not regulated by FINRA, the same oversight committee that manages broker-dealers. So, they can do their own internal due diligence. You don’t need to have “one of these outside third-party experts.” It’s just usually a group of guys. They’re local. They might manage a couple hundred million like your buddy. And it’s taking them to lunch, schmoozing them, letting them get to me, getting to a point where there’s a sense of comfort with your company and where you are.

And then there’ll be like, yeah, let’s do a couple hundred thousand. Let’s dip our toes in the water, see how that goes. And as long as you do everything you say you’re going to do, there’s transparency, there’s correspondence with investors, they see that at the end of the year, people are getting their K-1s, the next time you come to them with a fund or another deal, they’ll put in more money.

Josh Cantwell: Open it up.

Brad Blazar: And I’m a firm believer that if you’re not asking for referrals in each and every relationship, you’re missing the low-hanging fruit, but it gets down to how you ask people. I never say, “Josh, do you know anybody that we might also be speaking to?” Because that is a yes or no question. It’s who are you connected to that I should also be meeting with.

Josh Cantwell: Yeah, I love it, I love it. Brad, listen, as you’ve gone through not only your journey in raising capital, coaching and mentoring people all over the world to raise capital in this fashion, you’ve learned a lot. You’ve obviously come from this market. You’ve learned a tremendous amount. If you had to pick out maybe two, maybe three different items that had the biggest impact on your growth, the biggest piece of advice that you’d like to give back to our audience, what do you think stands out for you?

Brad Blazar: The biggest mistake I always see people make that are trying to raise capital is they try to pitch the deal way too prematurely in the process. There’s a series of events. Now, obviously, if you have a deal, you have a property under contract and you’re talking to a wealthy person, after you present, the natural thing for them to do is to say, “Well, Josh, that sounds pretty interesting. Do you have something you can send to me?” And so, you do that. Now, you follow up and you try to close them and they’re very evasive. It’s like, nope.

And it could be the best deal you’ve ever done. It could be like right on the ocean, in Palm Beach, Florida. Great numbers. You’re buying it at eight cap. But what they’re saying very subliminally is I don’t know you well enough to open up my check, but we didn’t spend enough time for me to know your values and really know you as a person. And what you have to realize about raising capital is that it’s not a sprint, it’s a journey. And one thing that I’ve become really good at is taking all of these 30 years of knowledge and all of these big concepts and codifying them and creating what I call missing structures or systems.

So, as I coach and mentor people, I talk about things like the trust sequence, the validation phrase, the four-step blueprint. And as someone we mentor, once you understand what this four-step blueprint is, it is basically a series of meetings or calls you have with that prospective investor, works like, dude, you ain’t pitching or talking about nothing until you get to that third or fourth meeting or conversation. Here’s 20 questions to ask that person. The SEC calls it KYC, Know Your Client rules. But you got to find out like, is this even suitable for them? Have they invested in something like this before?

Build that trust by being a good listener and then tell that person at the end of the second call, “Josh, like I’ve told you all along, right now, man, I just don’t have something I can talk to you about. The reason is I always like to give my existing investors the right of first refusal. But here’s what I love to do, I keep a list of people on my desk that have expressed interest. If you have an interest, I’d love to add you to that and get back in touch with you in the event I have an opening on something I think you can get real excited about. How does that sound?”

You see, when they say yes to that, what they’re saying is Josh, I trust you enough now to move forward in this process with you. And I explain to people, until you do that, if you’re pitching, you’re pitching too prematurely, you’re just going to spin your wheels or you’re going to be like that durable on a treadmill because when you try to close, they won’t write you a check. They may, but you’re increasing your chances significantly and you’re going to get much greater chance with people saying, yes, if you invest more time on the front end to really build that relationship. That’s what I call the six-step trust sequence. It’s understanding first call is introductory. Second call is going deep, asking questions, validating that they trust you to go to that third call and pitch on that third conversation or that fourth meeting.

Josh Cantwell: Yeah, I love it, man.

Brad Blazar: That’s the biggest mistake most people make, they try to do early, they get shot down. And after getting shot down six to eight times, they just give up. Oh, this is impossible. This sucks. Don’t know how to do it the right way. And so, they never get to a point where they can raise the tens of millions or the hundreds of millions of dollars like you and I both have.

Josh Cantwell: Yeah, fantastic stuff. Brad, listen, I’m sure our audience, especially those that are already doing syndications, want to grow their business for maybe $100 million and beyond, those intermediate to advanced commercial guys or even those guys that are on the residential side that really feel like they want to buy $500 million worth of real estate or trying to, I’m sure they’ll want to engage with you. Where can they get access to your book? Where can they get access to your bootcamps and follow you online?

Brad Blazar: Best thing, of course, is just go to our website. It’s just BradBlazar.com, B-L-A-Z, like zebra, A-R. There are no Es in the spelling of my first or last name. So, it’s Brad Blazar. You can find my book Winning at the Capital Game on Amazon. They’ll ship it out to you. If you want a signed copy, just go to our website, we’ll autograph it for you. Send it out.

We do eight bootcamps a year and we do them around the country. The last one we did was here in Houston. The next one we’re doing is going to be in South-Central Florida. And so, if you just start following me on social media, whether it’s Instagram, whether it’s Facebook, whether it’s YouTube, and you listen to our podcast, The Capital Catalyst Show, you’ll get into what I call my community and you’ll start basically finding out where I am, what I’m doing, what events I’m going to be speaking at. And it’s just a matter of showing up, getting in the right room.

We’d love to meet people. We’d love to send you an autographed copy of our book. But the book, Winning at the Capital Game, we’ve shipped that all over the world. It’s endorsed by Shark Tank’s Kevin Harrington. He spoke at my event about a year and a half ago, has become a good mentor and also a close personal friend. But there is a right way to pitch. There is a lot in also a pitch. And we want to make sure that if you’re going to go out there and really scale up, and more importantly, skill up, you’re doing it the right way.

Here’s another thing that I will add also, Josh, a lot of people out there that are in this capital raising space are doing things that they should not be doing. And it’s just, they’ve either not been taught by their mentor who’s never been licensed with FINRA or the SEC, and so, they’re forgetting to do things like, oh, I forgot to follow my Form D with the SEC on my Reg D offering, or I didn’t file a notice in other states because I’m soliciting investors in those other states, and I did not know I was supposed to do that and pay a small filing fee, or I’m not keeping a log of the private placement memorandums that we’re sending out. It’s real hard to unwind that stuff once you’ve already made mistakes. And all it takes is one bad apple and then you’re paying out tens of thousands of dollars to an attorney to defend yourself against a state regulator or the SEC or, God forbid, a good plaintiff’s attorney that will say, “Hey, can we see your PPM log on that last offering you did?” What are you talking about? Well, don’t you keep a log of who you ship that to? No, were we supposed to do that?

So, I spend a lot of time as I tell people, keeping you out of trouble because it’s much easier to do it the right way the first time than to realize, oh, sh*t, we’ve been making mistakes for the last three years not doing the stuff, and now, you’re opening a big can of worms that can really create issues for you because I’ve been doing this for 30 years and you’ve been doing it for a long time. Bad things happen to good people.

Josh Cantwell: Sure.

Brad Blazar: You got the best intentions. You get a great deal. You build a great company. Boom. There’s a hurricane in South Florida. And now, you got to go 30% vacant because 30% of your property was flooded. Now, you get one investor that doesn’t like the fact you’re not sending distributions. He calls a lawyer before you know it. You’re now in an arbitration. All it takes is one. And like I say, you’re a great person, but there are natural events and there are things that do happen in the course of doing business. So, just do it the right way the first time.

Josh Cantwell: Yeah. You got to have somebody to teach you that’s already been there, done that. Brad, listen, fantastic stuff today. I really love your passion, your speed. You guys that talk fast, they really know their stuff. That’s obvious that you know yours. So, thank you so much for joining us today on Accelerated Investor.

Brad Blazar: My pleasure. We’re here to add value. We’re here to help change lives. That’s what it’s all about. Everybody that’s a listener of Josh’s podcast, realize that you, too, can also be doing bigger things in life. It just is a matter of just taking that first step. Get off the fence, make that commitment, look in the mirror, because the biggest sale you will ever make in life is not to a client or prospects, it’s a sell yourself on what you’re actually capable of doing. So, go out there and do it.

Josh Cantwell: Love it, Brad. Thank you so much for joining us today.

Brad Blazar: You bet. Take care.

[CLOSING]

Josh Cantwell: So, wow, what a great interview with Brad. Man, one of my favorite topics in the world, really leaning on and talking to broker-dealers and registered investment advisors to recruit more capital. I used to be a financial planner that worked for a broker-dealer. And back in the day, we would never recommend a real estate offering because we couldn’t get paid on it. Broker-dealers, registered investment advisors, financial planners are very protective of their clients and very protective of their client’s money, primarily because that’s how they make money is through the fees. Well, now through these different optimizations, if you will, in the broker-dealer and registered investment advisor platforms in that niche, now you can take your real estate offerings, your funds, and if you know how to get them on these platforms, you can do it too.

I hope you enjoyed the show. If you did, subscribe, open up your phone right now, hit the subscribe button, rate, review, like the show. Leave us a review. I would love it if you would do that. And don’t forget, one of the things that I love to do is to teach my listeners and my subscribers how to syndicate apartments and how to build their portfolio to at least a thousand units and at least a $10 million net worth. That is my stated goal. I do that through our live events and our Mastermind program. You can check that out at ForeverPassiveIncome.com. Thank you for being here today on the show. And we’ll see you next time.