Showing What You Have to Offer with Alex Kholodenko and Jason Balara

Updated: Sep 3, 2021

Episode 180 of the Diary of an Apartment Investor Podcast with Alex Kholodenko and Jason Balara. Transcript by – please forgive any errors.

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Jason Balara 0:00

This is Brian Briscoe, hosts the diary apartment investor, podcast and partner at four oaks capital. So we have something that we've been working on for a really long time we are building and we'll continue to build an educational community that we're calling the tribe of Titans. And it's going to be a community of multifamily investors based around education and his house on the mighty networks. What you're gonna find in there is a lot of events that are exclusive to the tribe of Titans members a tonne of educational content, and you're gonna find great people. So if you're listening to this podcast, because you're looking for community or you're looking for education, go no further the tribe of Titans is something you need to look into for the price of about $1 a day, you're going to be able to have access to everything that we have an elder content that we continue to produce for years to come. And just so there's no pressure and there's no obligation, the first month is free. So sign up first month free, and give it a test drive if you'd like to keep hanging out and you'll continue to have access to Well, me and my partners are four oaks capital in a lot of other experience and aspiring investors. And where can you find it the tribe of Titans dot info. There's a link to that at the bottom of the show notes of every single episode right now. So if you're interested type in www dot the tribe of Titans dot info or go down to this bottom in the show notes and just tap the link. Jason, we got Alex on the line. What do you want to ask him

as a private equity group? What are you looking for? Right? What can I show Do you know sort of bring to the table to show other equity people that were worth investing in?

Alex Kholodenko 1:32

Do you need to identify your kill unique ability? Right? So there's a lot of people that try to do everything and they fail at everything as well. Right? So you have you decided to become capital partner, capital raiser. It's a fancy word nowadays is focused on that norm all of the skills so you know a lot of people come to us and tell us they want to partner up with First of all, I don't even know that kind of all you know, how much can you actually do deliver most of the conversation and up at that point.

Brian Briscoe 2:10

Welcome to the diary of an apartment investor podcast with your host Brian brisco. In this podcast, we bring some of the top professionals in the apartment investment field to discuss various aspects of the apartment investing journey with the sole purpose of educating listeners to make wise investment decisions. The Diary of an apartment investor podcast is sponsored by four oaks capital, bringing you high yield returns through apartment complex investing. Welcome to the diagonal apartment investor podcast. I'm your host, Brian Briscoe. With Four Oaks Capital. Very excited for today's show. We've got another Ask the Expert episode here with two great people with us today. We got Alex Kholodenko. info and Jason bhullar. And I hope I said that right Alex was. Alright, so just for the listeners, you know, we're throwing BIOS down in the show notes. So instead of spending time reading BIOS, we're just going to jump right in. So Alex, welcome. And do us a favour and tell us about yourself a little bit.

Alex Kholodenko 3:05

Yeah, thank Brian for having me on your show a little bit about myself. I was born and raised in Ukraine that explains why for such a law last year, immigrated in the 90s after college and settled in Bay Area, met my wife. I have two kids now and through family and friends settled down and started slow and work my myself up and I've been in the technology space for the last 20 years and 10 years ago, I started investing in real estate tried different sorts of strategies. As we all know, there's many, there's many ways to skin the cat. And accidentally through my research, I ended up googling and learning a little bit more and more about syndications on passive real estate investing and liquidation lasting in stock market for the last 25 years, I realised that there's a real estate game per se, that has a totally different benefits. And for me as a busy professionals, that was a game changer. I never looked back after I started investing passively six plus years ago, and now I have started my own company. I welcome it investments where we help busy professionals to invest, go invest in a project that we personally like and recommend to diversify outside of stock market that can be volatile, as we all know, absolutely. At any given point, as you know, there's a lot of volatility and people could lose their short or 30 40% at any given day as well.

Brian Briscoe 4:44

Yeah, and if people lose their shirt, Jason can send them one because I mean if you're watching the YouTube video, you'll notice we have the same shirt on because I was on his podcast a little while ago so he sent me the shirt but Alex something you said that I really appreciate there. You should come Invest with us, you know, and that's, that's something that I learned early on, you know, raising capital, that if you look at it as a co investment, people are much likely much more likely to to invest with you, you know, if you're talking to them about investing, investing, investing, that's one thing. But if you're like, I'm investing in this deal, because I think it makes sense. Will you invest with me? That's a much different conversation.

Alex Kholodenko 5:26

Totally, I think you have to have a very solid conviction and your skill that the thing that maybe separates a little bit, as from many other people and companies out there, we ask ourselves the question, do we like the deal as partners, and we don't have a strong conviction that this is not the deal that we will invest? Then how can you recommend this investment to your friends, family and other investors? Right? So yeah, to us, it's sort of a conflict of interest. And I think it is important to have a skin in the game. And if you don't have skin in the game, there's something really wrong with the deal.

Brian Briscoe 6:03

Yeah, and that's absolutely true. I mean, if if it's good enough for you, you know, that that's, that's a big step test right there. And, you know, when we were we were new in the syndication business, and I mean, compared to some people, we are still, we've been around for about three years, by the way, but I basically commit a lot of people to invest in our first deal is, you know, the, the partners in our company, you know, we have about 1/3 of the, you know, equity capital stack, you know, because that's how much we believed in the deal. You know, we all put your sizable checks to get into that thing. And it made it made the capital raise a lot easier because it was, Hey, I'm investing this much. You know, can you can you throw in 50 or something like that. So I think that's a that's a really, really good tip. Glad you you brought up that point. For sure. Yeah. So just recap. When you invest in the stock market, you caught wind of the syndication, what now have you have you invested outside of multifamily? Or is most of your investments been multifamily specific?

Alex Kholodenko 7:00

Yeah, so I have actually invested in a variety of different sectors I invested probably in over 50 plus syndications in multifamily. I was one of those pioneers that was brave enough to start investing online, without really knowing anybody, on a personal level. So I had some good results. But I had some bad results as well, you know, some companies get bummed out. And some sponsors get not delivered, some companies that were managing this relationship to crowdfunding platforms went out of business. And it's been a messy investment on certain of my portfolio holdings. But on the other hand, over time, I developed some very cool, strong strategic partnership was other sponsors. So you have to take a risk, and not every investment, as you know, will perform. But luckily for me, I got a good exposure. And I understood the diversification and right away so I really like the component of diversifying a little bit of multifamily hospitality, industrial storage unit. So I right now I focus with my business partners on primarily multifamily space, but our plans is actually do expand and work with other sponsors in commercial real estate. Yeah,

Brian Briscoe 8:26

something one of my mentors told me early on was, you know, you're not looking for homeruns, I think you hear about the homerun deals a lot, you know, and I mean, if you have something that kicks back 70 or 100% IRR, you're gonna post it on Facebook and post it on LinkedIn, a lot of people see those deals, but you know, he explained, he's like, you're not looking for the homeruns, you're looking for the singles.

Alex Kholodenko 8:47

Very true. And I openly talked to people, potential investors about some of the deals that didn't go well, because there is a risk component, all of these returns that we have or just projected returns, you know, we can never guarantee them. And this is why it's so important to do due diligence, not only an asset, but on a sponsor itself. They have a track record, you know, do they have systems in place, they have property management, what's the downside to the risk? What are the risks associated with that? And these are some of the questions that sometimes it's uncomfortable to ask, but I encourage people to do that, and see what the response will look like.

Brian Briscoe 9:32

Yeah, I agree wholeheartedly. I mean, you as a passive investor and I, I started actively investing, you know, I had limited funds. And so you know, the choice for me was passive invest or, you know, save the money up for now, our first investment but now, anyway, long story short, now that I'm passively investing. No, I'm looking at it from that lens too. And I'm looking at the sponsors more than I'm looking at the deals, you know, and I care about the deals and I I care about the numbers. But you know, I've got two degrees in math. And one thing that I understand is, you know, garbage in garbage out, you know. So if if I can trust a sponsorship group, I know that the numbers are going to be good on the paper, and I know that they're going to be able to accomplish, you know, the numbers that they put on the paper. So, you know, yeah, I'm doing my due diligence. I'm looking at sponsors, 90%. And deal 10%. It's kind of how I look at that. So to walk us through how you went from exclusively passively investing into actively investing yourself and getting into throwing your hat into multifamily bring, so to speak.

Alex Kholodenko 10:37

Yeah, sure. That's a good question. So I never in my life, I could have imagined that this is what I would be. If you asked me five, six years ago, when I started investing passively, but over time, I always liked the component of analysing deals looking at investment. So at one point, I realised that I'm becoming good at it. And people started asking me, hey, Alex, if you have a good deal, next time, you're going to invest, why don't you tell us about and the little light bulb went on? And I started thinking about what well, what if I create a company and put systems together in place and develop strategic partnership. So it was a long journey. It took me maybe a year or so to plan I had think about the main event, the wealth in mind investment company, we had a lot of brainstorming sessions with my business partner, who I've known for 20 plus years. So she's a man is one of my best friends and partners in this business. He is local, we actually used to work in a mortgage company together. And we both had passion for real estate, and we transitioned over time, it didn't, it didn't happen, you know, in a moment. In fact, our first deal, when we call syndicated with another group was during COVID, probably the worst time to do the deal. But the stock market thing that time there was a lot of panic. A lot of people were like, what the hell is going on? This is the end of the world. Am I going to lose all my retirement and retirement funds? You guys remember that? Right? Oh, yeah. Only 30 40% were wiped out. Yeah. And we've never looked back. And it's a lot of trial and error, you know, renewer. ship, as you guys know, you know, there is no step by step instructions. You just start and then you find better ways. Yeah, along the way, and they will never look back. I mean, you know, we just like the deal for six months, we were hunting for a deal. But what you said is so true. It's the sponsorship team, because the numbers, if anybody knows math, and real estate and finance, and really well can easily be tweaked. You know, I don't want to say what manipulated but they can be, they can. But if you have a sponsorship team that you trust, you develop a relationship with that they have a track record, they have system in place, they're responsive, they're able to answer your questions that some of them do not, you know, some of the sponsor, you ask them some questions, you never hear back because they don't have the answers to your objections, right. And I've been hunting on the deal, we finally did the first one, and then it's kind of been a snowball. Since then, it gets easier over time. If somebody is just starting out. My advice to you is, there's never a perfect time to start any business. It's always uncomfortable. You know? Luckily for me, I never had a fear of asking people for other money, because I'm 100% in on a deal when I tell people about it. You know, I have zero hesitation to tell them, You know what, this is the deal. I'm investing. I'm recommending this deal to you. What's alternative? I mean, please look at other deals, as well. But I have a strong conviction. This is one of the best investments that will come across, that we can co invest with you together and build wealth.

Brian Briscoe 14:01

Yeah. I love that. I love that. And I love how your mind worked when when people you knew started asking you Hey, tell us tell us when these investment opportunities come up. We'll invest with you. Actually, a couple days before we met in Dallas, I ran across another guy who's in the exact same situation. He's like, yeah, I've been investing passively for you know, three or four years now and I had like four or five friends that I've referred to other syndicators along the line. And I finally realised that I could pay to do that but you know, I think you got same light bulb went off in your head and incidentally, you know, met your business partner and I think he's awesome, you know, great to meet you in Dallas too, but very, very excited for what you guys have done and to see more successes coming up. But you know, that said, something I'd like to talk about and you know, Jason's podcast is called no your why but what is what is your why what is your like, I call it your big burning Why?

Alex Kholodenko 14:55

Sure. Well, you know, a lot of people think about, you know, financial freedom, that that But I think it's a it's the outcome of the effort that you produce. So my goal is with my business partners is to help 1000 people that are busy professionals to open up this world of syndication because let's face it, most people have no clue with passive real estate investing. It's true. And it's through education or getting to know them, and not be pushy, not be salesy. Just be yourself. Tell them the story that yes, they can receive this amazing tax benefits will take care of for all of the management they today's we were out really good deals and find a really good operators that we work with, and by helping others ultimately, you benefit, right. So my focus in my Why is I want to I want to build a tribe I want to build 1000 investors in, in our platform that we can help with and by helping them obviously, you know, my mission, my life mission will be fulfilled.

Brian Briscoe 16:00

Yeah, yeah, absolutely. They're one of my favourite quotes, even since I was little as Zig Ziglar quote, and probably not gonna say it word for word, but he basically said, you can get anything you want in this life, by helping enough other people get what they want. You know, and I believe that to be true, you know, and there's also, you know, the golden rule and in Christianity, you know, do unto others. But the golden rule is also golden in business, you know, if you're, if you're helping others and treating others, like you want to be treated, that comes around, and it will eventually benefit you. And in a lot of ways, so.

Alex Kholodenko 16:34

Yeah. I mean, there's no shortcuts in in any business now. And like I said, you know, you start slow, and you're just sharing your story, just like what I'm doing today with you guys. And with all the listeners it just be authentic. Be yourself, tell the story. If you have a strong conviction, if you've ever struggled. Yeah, you have to have that. You have to have a must. Yeah. And because people, your people relate to you, you're ultimately people invest with you if you have a strong conviction.

Brian Briscoe 17:03

Yeah. And I think if you don't have that strong conviction, it will come through, you know, maybe very subtly, or maybe subconsciously, but people will pick up on and they'll they'll, maybe their spidey senses or whatever, will start tingling, and they'll understand, you know, Jason's got the Batman symbol. My okay talking about Spider Man today, but

Jason Balara 17:21

Spider Man is fine, too. Yeah, I'm a equal opportunity. Superhero fan.

Brian Briscoe 17:25

All right, Got it. Got it. Yeah, so maybe your spidey senses are tingling, you know, but it will come up if you're if you don't have that conviction in a lot of ways. So let's do this. Let's talk about, you know, one of the deals that you guys have raised money for and had people co invest with you.

Alex Kholodenko 17:39

Yeah, yeah. So we're, we have done a deals. Actually a deal is under our belt. Right now. We're focused on certain markets, you know, I'm in Silicon Valley, I would love to buy something that would cash flow from day one, locally, but it's unrealistic, and the prices are still on fire and keep going, like Phoenix. We've done a couple of deals in Phoenix, we've done multiple deals in Texas, Carolina, as well. So one of the deals that I can probably highlight too, and we have a similar deal, currently, also is we like portfolio deals. A portfolio deal is something that is rare, it's unique. It's where an investor can simultaneously invest in multiple assets. So you're getting instant diversification. A lot of people obviously like to invest in one market, then they'll invest in another project, another market. And last year, we did a deal with a strategic partnership group that I actually invested as a passive investor in multiple projects and had an exit. And over time, I developed strong relationship with the sponsor that allowed us to work with them and bring our investor base into the deal. And it was a portfolio deal of 12 assets in sunbelt states, and we just received an overwhelming response from our investors. For those reasons. It's an instant diversification, they have a fully integrated property management, they have construction company as well, as part of their team. We got to know them. Well, all our business partners know them on the personal level. We've met them many, many times we develop good relationship, and there was a strong conviction, there was a strong why we love the deal. And we simply just share the story with our investors and we had an overwhelming, subscribing, over subscribing, offering,

Brian Briscoe 19:35

then you bring up a really good point. I mean, the the portfolio deals 12 different units. I would imagine the 12 different units have much different risk profiles to you know, some of them are probably cash flowing better than others. Some of them have a little more upside than others, but correct me if I'm wrong, but I'm guessing when you put all four all 12 of them together, correct and, you know, they balance each other out.

Alex Kholodenko 19:57

Yeah, that was a very complicated transaction, but It took a lot of time, we have multiple delays, it was through multiple sellers as well. And then the long financing, all of that was very complex. On top of that, you know, on large portfolio deals we're talking about 300 400 $500 million, sometimes is that there is also an anchor investor that comes in and producers, sometimes 80, sometimes 70 times more of capital. And usually it's institutional funds such as pension fund, it could be a PE, fund, pe firm, as well as be firm. And, and they shop around the offers from them. So you know, we were exposed to a totally different world out there, we kind of got, you know, a sneak peek behind the scenes, what's happening out there. And we're just very grateful, and honoured to work with such an experienced partner team that decided to work with us. And it's, again, through relationships, building strong relationships with our partners, because we rely on our partners a lot. You know, as we all know, it, I know, it sounds like he shared real estate is a team game. So there's a lot of people in the ecosystem that you need to build and create strategic relationships that you can play your part. That's another advice I would give to somebody who's listening to as many moving parts in this business. And you have to figure out really quick what your unique skills and ability is. Because all of us have.

Brian Briscoe 21:30

Yeah, I mean, that's something exactly what what which one of the moving parts can you take? Take control of it? Can you do well, and that's very good. A lot a lot of gems placed there. You know, you've got a sponsorship you've invested with possibly prior to you have really good trust and and you're able to peek behind the curtain and much larger deals than you thought you could have landed yourselves. And that's, that's a world the private equity world is a is a world that I'm excited to eventually get into. But you were still together. Yeah, we'll get there. And we're talking like, you know, we want to get there soon. But you know, eventually we're going to, you know, break that threshold and get into it. But anyway, a lot, a lot of goodness there. One last question for you before we bring Jason on. What's next for you? Oh, next for me is we actually have an even bigger deal. Nice. It's right.

Alex Kholodenko 22:21

It's a portfolio 21 assets. It's a 4000 unit, we're so we're already have sought to resolve oversubscribed, people now on a waiting list. And we'd love to continue to find a really, really good deals, we have another deal coming up in Phoenix after that probably later in the month. And we just want to be picky with it. We want to be very selective market is hot as well, no, yeah, there's a lot of people that have money to deploy that interest rates are super low, just it's insane. And the banks pay nothing, it just and we think this low low rate environment is going to either for a while, actually. So it doesn't make sense to keep the money in the bank, because it's just inflation, it just continue to erode this

Brian Briscoe 23:10

year, the Fed came out last week. And I mean, they, they they say they're gonna keep rates low until at least fall winter. 2022. So, you know, if you take them at their word, we got at least you know, 12 to 18 more months of a low rate environment, and we closed on a place last week, you know, our loan is mid freeze, you know, inflation, you know, the the CPI over the last 12 months is 5.4. So, I mean, it's almost like the banks are paying us encourage money. Yeah,

Alex Kholodenko 23:43

yeah. encouraging people to get your good belt, right. You don't want to go crazy and buy some assets that are just depreciating and not appreciating?

Brian Briscoe 23:53

Absolutely, you know, and and, you know, we'll The problem is the money is so free and open that I think the prices are going up and up and up. But, you know, it's one of those where, you know, they balance it out. Yeah, it's a balancing, you got to find the properties that you can still get into at a good price and take advantage of the low interest rates. But

Alex Kholodenko 24:14

yeah, for sure. Just, just, just to add to that is what you mentioned earlier, is a lot of people that are still new to syndication are starting to come around because of the low interest rates, the longer you know, banks are not going to increase them. Yeah, let's just face it. When it comes to savings account money market account, these rates are gonna stay and they're gonna stay for a long time, probably a year or more. And you know, what a great way to diversify and invest passively, with experienced operators that have good business plan and structure in place that you can generate 15 to 20% annual returns, including cash flow distribution of 8% Yeah, paid out quarterly.

Brian Briscoe 24:58

Yeah, it's it's it's something that You know, I like to shout from the mountaintops how well this this asset class works for for investments. But, you know, see, see how many people we can convince as well. But let's say we're going to shift gears slightly. Bring Jason on. So Jason, welcome.

Jason Balara 25:14

Thanks, Brian. Thanks for having me on. And thanks, Alex for for being here.

Brian Briscoe 25:19

So Jason, do us a favour and tell us you know about yourself and tell the story of how you got into multifamily? Yeah, sure.

Jason Balara 25:25

I guess the easiest place to start is sort of my my day job. I am a veterinary surgeon. And so that's kind of what I do for a living currently. But I've always had a background in construction and investing in single family houses, mainly in the form of house hacking, or live in flips on a triplex in Boston at one point, because I'm from Boston. And so once I got into my veterinary career, I sort of got away from doing anything in real estate, other than just renovating the houses that I lived in. And then recently, probably over the last approximately about a year, I felt like, okay, we had we had our current house done, I wanted to really get back into investing seriously in real estate. And I live in Los Angeles. So I'm also in kind of a expensive, low cash flowing market. Yeah. And so I started to think, Okay, what can What can I do, and my first thought was, well, I know construction, so I can do flips. The problem with that is that I already was working a lot. And I felt like that was just going to give me another job. And so I came across some podcasts and books on long distance investing, but initially looked at it from a single family type scenario. And again, a little bit more research, and I just realised that the ability to scale with single family wasn't going to really be there. And so I, I kind of worked through all that in my head. I know a lot of people do each step along the way. But I sort of realised, okay, I, I want to get right to the multifamily part and spent the last year really kind of working on that. So I got a mentor. And I started just analysing as many deals as I could, as you know that the markets been hot, and things have been expensive. And it's been hard to find deals that really make sense. So in addition to that, I was trying to network as much as I guess, as much as you can in COVID space. And so with that kind of met people through my mentor started the podcast that's helped as well, but ultimately was able to leverage that into a joint venture in a in a self storage deal. And the reason for that basically, as I was connected with these guys, and they were previously doing multifamily, and decided that the returns weren't good enough, so they went into self storage, and they were doing that sort of joint venture Model Model instead of syndication. So I was trying to also just be opportunistic, we did a little bit of private lending to some house flippers, and, and as well to put capital to use. And then I just kept looking for deals, looking for deals. And then recently, As of early summer, finally underwrote a deal that actually made sense, and I just kept, I probably did it three or four times because I was like, this can't This can't be right. Every time

Brian Briscoe 28:18

on with this. Yeah, like every time Oh my goodness. Yeah.

Jason Balara 28:22

Right. And it was, it just goes back to that sort of relationship building thing. Because I actually found out about the deal through a property manager I had been communicating with, basically on every deal I looked at and was like, Hey, what do you know, what do you think about this, and we just sort of became friends. And so he heard about this deal through a broker made that introduction. So it just goes back to that sort of relationships. And it's a team. And so we actually, as of Friday, went under contract on that particular asset. And then, while I was there, doing some of the due diligence, we got a little bit of pre access, the broker was said, we have this other one around the corner that's off market if you're interested. Also a good deal. And so we have assigned Li on on that one as well. So that's, I guess, when it rains, it pours right in all sudden, you know, things things are happening. So that that's kind of my story in a nutshell, in terms of getting into multifamily.

Brian Briscoe 29:22

tell you about that. That's a great problem to have, you know, we we've had two points, you know, in our company where we had multiple ello eyes out, and more than one came back sign, you know, and it was every time that happens, we just sit down and say, you know, we've probably got the best problem we could ever think of we've got two deals that we've got, you know, figure out how to raise money on clothes on and I imagine you know quite a bit of your questions might be you know, leading into that today. But before we get to the question, yeah, for sure. Before you let's talk about your why. You know what, what is your big burning why

Jason Balara 30:00

Yeah, my way, I would say sort of twofold that the the main one is, is his family, you know, because I, what I want out of real estate is time freedom, right? I love being a veterinary surgeon, I love, I love that job. But it's a job I can't do at home, it's a job, I can't bring my kids to with me. And we can't, we can't do that together. Whereas real estate, aside from the fact that I can do it from home, my son can come out in the office, like, we have a little baby seat for my daughter, she can sit out here too, I mean, we have, we have things set up so they can actually, you know, be around them. And then the other thing is, this is stuff that I never learned. And so, you know, I've spent the last year really, really digging in and learning a lot about, you know, investing in the tax benefits and, and everything that that, as you guys talked about, that makes you passionate and, and committed to it. Now, I want to tell everyone, and I know that you know, veterinarians, you know, in my world veterinarians, they're not. And maybe this is in other industries, but they're not people that know, you know, a lot about real estate investing in syndication and things like that. So it's my goal, to also help other veterinarians get out of that, you know, kind of most of us love what we do we get we got into it, because we love helping animals and helping people with their pets. But But also, it's actually I don't know, if you know, it's a, it's an extremely high suicide rate, because of the high pressure, generally low income for what people are doing. And just the hours worked. And so it's, I think veterinarians and dentists are the two highest professions in terms of suicide rates. So there's been there's been, like said, it's sort of multi multi fold in terms of my wife, you know, my family, but but then how can we how can benefit people, you know, in a broader sense as well? Absolutely,

Brian Briscoe 31:53

absolutely. Well, here we come to my favourite part of the show, I'd say, Jason, we got Alex on the line. What do you want to ask him?

Jason Balara 32:01

Yeah, Alex, again, thank you for being here. I mean, my, as I said, I just sort of got into these two deals, which is super exciting, and a good problem to have. But I think what makes me most nervous about it is probably what makes everyone most nervous about it is the capital raising side of things. And so I guess my first question is, maybe some tips and tricks that you used when you first started, I know, you said, you were investing as well, which I intend to invest alongside, but But how did you maybe first, approach those conversations?

Alex Kholodenko 32:36

When it started to investing with investors with potential investors? Yeah, yeah. Yeah, yeah. So the number one thing is you need to start talking about it. Because you know, let's face it, people are not going to start investing with you right away. I know a lot of us are very excited. Yeah, I got a great deal. Awesome. Let me tell everybody, you're gonna wire your money tomorrow. That's not gonna happen. People have different time lines, they have different deadlines, things happen. And they have lives. You know, people change jobs, people start businesses, divorces this and that, the sooner you reach out and tell people and share your story, that you are in real estate investing, the better and then stay in touch with people just because somebody said, You know what, this is not something that I'm interested in doesn't mean no, forever. Right. So that's one thing. Second thing is, I hope you know, or listeners do, you should create a pitch deck. And what a pitch deck is, it's, it's a little bit a story about yourself, maybe some of the investments that you've done, maybe your little bio, as well as some of the other things that you've done in your past. Because ultimately, people invest with you. They need to know you, you're going to initially you're going to reach out to your family and friends, right, they know you, but they probably don't know much about investments, what you've done, as well. A lot of times it's a very touchy topic. You know, people don't like to talk about money with family and friends. But if you truly genuinely care about them and your soul that you personally want to invest. I think you're doing dishonour by not telling them about Yeah, yeah, that's,

Jason Balara 34:23

that's a really good point. I it's a it's definitely a hard mindset to shift. I think, you know, you're that's a great point about, you're doing a dishonour to them by not telling them because as a new investor, it's kind of like, Okay, I'm, I'm very happy to invest my money in there, I now realise the benefits and in the, in the last year, we've been able to generate in a short period of time, we've been able to generate a fair bit of passive income for ourselves for our family. And so I'm like, yeah, everyone should be doing this. It's in my mind. It's very clear that this is something that should be happening. But the flip side to that is I still struggle with, you know, asking people for money, rather than looking at it as an opportunity for them. And that's

Alex Kholodenko 35:13

the key. I think that's the key mindset that we all you need to continuously work on is be proud of what you offer. It's an opportunity. They could say now, you know, for whatever reason, I talked to a guy recently, he is he invested in two deals with us. He's receiving cash flow distributions, and he is going to invest in the next deal. And I always casually ask, you know, do you know anybody else that might be interested? And very interesting thing is, I don't like to tell my friends and family about this. I mean, come on, you're already seeing the results. Right. Right. Yeah. But but some of us carry these stupid stories in our head, that are not helping us not serving us, right?

Brian Briscoe 36:02

Yeah, I'll tell you one, one simple switch is when you show up to the office on Monday, as soon as other people around you, inevitably somebody is going to ask you, how was your weekend? You know, it's really simple to say, you know, I spent a lot of time working on this apartment deal. You know, that's something you can naturally weave into any conversation. Oh, hey, how are you? If you meet somebody you haven't seen in a long time? How are you? How have you been doing is usually a question that comes out. And, you know, it's just a matter of finding ways to, to naturally weave it into conversations. And what I what I found is most people self select, you know, so you don't have to necessarily ask people for money. Because once you start talking about it, people will self select the last questions like, Wow, that sounds interesting. How can I learn more? Oh, hey, you know, let me know, when something else comes up. I, you know, I've got money to invest to but I have found that more people are self selecting. And for our deals, I'm not asking people for money. I'm talking to people about what we do. And they tell me, they want to be on our investor list. And they tell me that they want to invest in the next deal that we're doing. But I mean, part of that is traction and success that we've had, and you're on your first deal. But, you know, it's definitely talked to more people and pay attention to their reactions, and then the follow up.

Alex Kholodenko 37:22

And listen, that's a good point. But I listen to what they're why I mean, they all have different reasons why they are investing too. And if you can tie that up there. Why was because let's face it, real estate is just a vehicle to build wealth. And to give options. I mean, people have options, right? They can invest in the stock market, they can invest in Bitcoin, and other things, as well. And if you can find out why it serves its purpose for them, then how can they say no to it? Yeah.

Brian Briscoe 37:53

Yeah, that's really good point. All right. Next, we get another one. Keep going. Keep going. We got we got about five or six more minutes on the clock. So keep going.

Jason Balara 38:01

So and I, I've been doing probably not as much as I should, but I have been trying to like, talk about it all the time. I'm sure people at work are sick of it. But that's okay. I'm excited about it. Anyway, what I have, as these deals have been coming up, I'm like, Okay, what, what can I do, to bring in other capital raisers? What can I do to talk to like Equity Partners, things like that. And the same things keep coming up. We want experienced operators with track records, and all of this. And so I guess, my question really has to do with the fact that everybody starts somewhere, right? And so these are the operators that you invest with that are, you know, you're like, these guys are amazing. At some point, they started in you, Brian started somewhere. And now you're very successful. And so it's very obvious that once you have a track record, and everything like that, then kept raising capital easy, right? That's, that's no. And so it's just kind of I don't know that there's even an answer to this, but it's just like as a private equity group, what makes What are you looking for? Right? What can I show Do you know, sort of bring to the table to to show other equity people that were, you know, worth investing in?

Alex Kholodenko 39:16

So, as I mentioned earlier, is you need to identify your kill unique ability, right? So there's a lot of people that try to do everything and they fail at everything as well, right? So you decide to become capital partner, capital raiser, it's a fancy word nowadays, is focused on that learn all of the skills. So you know, a lot of people come to us and tell us, you know, we're gonna partner up with you. First of all, I don't even know you. Right. Second of all, you know, how much can you actually do deliver, and most of the conversation and up at that point, people are not willing to take time to Get to know you to build relationship. It's a dating game, right? You're not gonna do business with somebody that you just met the band or the bar, right? That's not gonna happen. And if you can just identify one key skill set, maybe this calculation that you devote to that you build stronger relationship with your investors, they might not invest with you right away. And you don't have to feel bad about it. Because they've got to do it on their returns at their own time. Yeah. And in the meantime, you start developing those relationships, maybe you invest passively, with one operator that you really admire, or with the group that you really work to get behind the scene, understanding on the deal flow on their quarterly updates, maybe you ask them for internal underwriting, maybe they will share it with you Probably not, but you can find, maybe you fly to meet them. Do you know how many passive investors fly to meet with sponsors on their own dime?

Brian Briscoe 41:02

Very few?

Alex Kholodenko 41:04

Probably very few. Don't be happy to see you buy there. Yeah, there'll be very happy to see because nobody does it. Nobody takes nine to get to know them and their people to

Brian Briscoe 41:14

Yeah, Yeah, I agree. I mean, a lot. A lot of it is reputation based. And the question everyone asks is, how do I get in and gain that reputation? You know, the only thing I'll add is that there's a lot of networking groups where where people can get together. And if you're, if you're looking to raise capital for somebody, and you haven't been established, yet, somebody else who is not fully established yet, or that's the type of person is most likely to bring you into the deal, but it's a little more risky, you know, from the fact that, you know, they're unproven, your unproven, you know, so it's a little more of a risky bet. But just just make sure that there's somebody with experience on the team to guide people. And oh, by the way, lenders are going to insist on that too. But, you know, if you're looking to get into other deals as a capital raiser, and you're looking to bring other capital raisers into your deal, and you don't have the track record, yet, the best option you have is find somebody else in your shoes, find somebody who's trying to get their first or second capital raise, you know, in the books, or we just got their first or second deal under contract. You know, those are the people who are hungry, those are the people that are going to hustle. And, you know, those are the people who are going to take a chance on you.

Alex Kholodenko 42:27

But very good point. And don't be afraid to reach out to experience operators, but you cannot just reach out once again, they they say no, this is not the right time you just give up. Right? Right. But then they'll ask you some questions. You know, one of the times I remember a couple years ago, when I was exactly the same shoes, as you, the guy asked, okay, well, you want to do capital raise, that's fine. How much can you raise? And I said, Well, I'm not sure. Maybe I can do half? Well, then you're sure get back to me. Because we're gonna deal with the guy who is thinking about it, who is not sure. So if you commit, let's say, a million dollars, you make that phone call? you're hesitating because you're still not 100%? Sure, let's face it, you're gonna hear, but then you have to have a strong conviction. And guess what, you have to be sure that you deliver that 1 million bucks. Because guess what, if you don't you lost your reputation, most likely, he's not gonna do the deal with you anymore. And the reputation spreads? Yeah, yeah.

Brian Briscoe 43:34

We brought in a couple of capital raisers on one of our early deals, you know, it was, it was a $4 million raise. And, you know, we were, we were thinking that we could probably get about 3 million ourselves. So we brought in a handful of capital raisers. And the frustrating thing is when people come in and say, I think I can get 500,000. And they come in with 50, you know, you know, and that's, that's, that's frustrating from from both both sides of it, you know, so if you're expecting a half a million dollars from somebody, and they bring in 50, you know, now you're scrambling and that's that that's not a good thing. So, yeah, and end of the day, I like what he said you got, you got to be sure that you can hit your mark, you know, you got to be you know, you have to be confident when you're talking to the operator, but you also have to have something to back it up. You got to hit your mark.

Alex Kholodenko 44:22

And it was this experience, guys, as you know, you have a one shot if you don't deliver on the time shot. I mean, would you do another deal with such person that didn't deliver? Probably

Brian Briscoe 44:36

makes Probably not, unless they have a fundamental shift unless they have, you know, three or four deals in a row where they hit that mark. You know, if we can somehow explain that it was a fluke, for some reason, but we do consider it but on our very next deal, no, is the answer so well, that said we are about out of time. So we're going to wrap things up and one question for each of you to finish things off. Alex how can listeners learn more about you?

Alex Kholodenko 45:03

Yeah, so they can reach out to me on wealth in mind I actually have a 101 question guide for passive investors what to ask before you evaluate the deal happy to share to anyone who is interested to learn more what we go through when we look at the potential investment I can be reached out at Alex at wealthy mind

Brian Briscoe 45:30

All right, we're gonna put a link to that to the website and your email address in the show notes for anybody interested and you know he's got big portfolio deals is what it sounds like. So if you're interested in you know, parking money into something with a little bit of stability and isn't diversification reach out to him? Sorry, accredited investors only I should read it investors only. So Jason, same question for you. Yeah,

Jason Balara 45:54

you can reach me at my email is Jason at Lark capital comm also pretty active on Instagram and trying to be more active on LinkedIn, but on Instagram, it's Lark capital, and on Instagram is just Jason Valera. And if anyone wants to call, My number is 508-561-3269. Happy to happy to talk to anyone about this stuff. I really enjoy it.

Brian Briscoe 46:17

All right. Sounds good. And we'll make sure that information into the show notes as well. And Jason's got deals too. So that said, Thank you, both you guys for coming on the show today. Appreciate your time. And I look forward to chatting again soon. Thank you, Brian. Thank you. Maybe next time we'll all have matching shirts. Yeah, I'll get you a shirt Alex.

Jason Balara 46:53

Thank you for listening to the tiger and apartment investor podcast today brought to you by four oaks capital. If you'd like to know more about how to invest in apartment buildings or want to be a guest on our show, visit our website at four oaks capital comm slash podcast or email us directly. If you're still listening, you obviously like the show. So pull out your phone, app, subscribe, and leave us a five star rating on your favourite podcast app. And we'll see you again next week.

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