Vetting New Passive Investors with Ellie Perlman and Roschelle McCoy

Episode 185 of the Diary of an Apartment Investor Podcast with Ellie Perlman and Roschelle McCoy. Transcript by – please forgive any errors.

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Brian Briscoe 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. Rochelle, we got Ellie on the line here. What do you want to ask her?

Roschelle McCoy 1:22

When you're doing calls with your passive investors? What are the most important questions that you want to make sure you cover with them?

Ellie Perlman 1:30

During the call? There are a few questions. Some of them are just to make sure that they're comfortable that they're interested in in multifamily, generally speaking so the confused mind tends to say no. So making sure that the A that they they're interested in real estate and B that they know how a syndication works because many people don't still don't. That's that's going to be very crucial because some of them are going to be embarrassed to tell you that they're not exactly sure how this whole thing you know works.

Brian Briscoe 2:11

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 diary apartment investor podcast. I'm your host, Brian brisco with four oaks capital. Very excited for today's show. We have two amazing guests on the line with us. We have Ellie Perlman and Rochelle McCoy. So first off, Ellie, welcome to the show.

Ellie Perlman 2:50

Hey, Brian, I'm really happy to be here today. Thank you for having me.

Brian Briscoe 2:53

Yeah, thanks for coming on the show. I very much appreciate it. Then super excited to to hear more about you and learn a little bit more about you. So you know, that said, would you would you start us off by telling us about yourself?

Ellie Perlman 3:06

Yeah, absolutely. I'm an operator, you know, owner operator and a syndicator of multifamily. And I started my career back in 2000, around 2007 2006. So very, very interesting time to get started in real estate. And at that time, I was not an investor just yet. I was a real estate attorney, lawyer, and learned a lot about how risky it is to take very aggressive debt. Because I experienced that with my clients. And then after my legal journey, in real estate, I switched to property management. I know it's not as exciting, perhaps as being a lawyer. But I wanted to be closer to the real estate world and understand how it works. And after that, I made a transition on you know, move to the US from Israel and went to MIT and got my MBA degree and not so long after graduation from from grad school. I actually started Billy capital, which is the company that I that I managed today and owns over 400 million in assets under management.

Brian Briscoe 4:17

Nice nice now interesting the jump from real estate attorney to property manager usually see people want to go the other direction. Was this part of the master plan? I mean, was your ultimate goal to become a syndicator and investor like you are now or was there something else that drove that?

Ellie Perlman 4:36

I mean, there was a general plan of owning real estate, I wasn't sure exactly how to do it. I definitely do not plan to go to law school to and then quit my job and become a property manager but I normally don't follow, you know, the path that many people take, and people raise their eyebrows and we're kind of a little bit shock because you don't go to law school and then kind of it looks like a step down from where I was because it's not as prestigious, you don't make as much money. But I don't know I was I really wanted to be part of the real estate world to understand how to handle tenants and how real estate actually works. So I took I took a chance, and I knew it was not going to be forever. And I said, hey, let's try it and see where it's gonna leave me.

Brian Briscoe 5:29

Yeah, you know, well, there's a lot of things here that I like, because, you know, you understand the real estate from an attorney's perspective, okay, so you understand the whole legality of everything. Now you understand it from a property management perspective. You know, you went to MIT, which, you know, kind of a big deal, you know, I'm still upset at them, cuz they didn't accept me 20 years ago, but so you have the, almost the perfect picture perfect background and do what you're doing now, because you have a lot of experience in there. And I imagine that your little foray into property management has paid dividends many times over what you're doing right now.

Ellie Perlman 6:06

Yeah, it was interesting the way that you know that it happened. And I think if you know, you can have the best education in the world. And the best experience, if you're not truly passionate about that, about real estate, or anything else that you do, for that matter, you're going to be burnt out, and you would want out. So there has to be that that desire. And even after I graduated from MIT, I wasn't sure I knew I would, I would want to be an investor, I want to be an investor, but I wasn't sure. Is that fix and flips? Is it, you know, is that the path to go? Should I buy single family homes and rent them one by one after another? Or should it be, you know, multifamily, or retail or any other there were so many options. And this is where I use my education. And I understood, you know, if I want to scale, I know how to scale companies, because that's what I've learned to do. And I realised that buying one asset after another, if it's one door at a time, it's gonna take me so much more time to scale, finding home, you know, single family homes negotiating the price, you know, managing, it's, it takes, I'm not gonna, I'm not gonna say that it's as as hard or as easy as finding multifamily property. But you still need to put time into buying one asset after the other. And I did kind of reverse engineer the time, it's going to take me to get to a certain amount of doors that I wanted to get to. And I realise that that's not going to be, that's not going to be the way so I understood I needed to go big, and start buying multifamily. And I've never actually bought a rental property, just one door, I think the the smallest asset I've ever owned was 28 units. So it was one of my first assets. And probably the big one, the biggest one is 1032 units. So that was the range. So again, I decided to take you know, was a leap of faith. And I decided to bet on myself and take the risk. And again, other people looked at me and said, Oh, you're starting big. You should start with one door, you should learn how to do it, and then slowly go, and you know, graduate quote, unquote, and multifamily and I just thought that's, that's on my way. Yeah. You know,

Brian Briscoe 8:27

and I realised that as well. And it's, it's interesting, all the things that went through your head that you were just talking about, I had the same same questions. I always wanted to be involved in real estate. I did dabble in single family, you know, and I did start looking at the four plexes and the eight plexes. And, and whatnot. But, you know, I was I was active duty for 20 years and just retired. But the whole time, I think part of the reason I went 20 years active duty was because I couldn't figure out how to get into real estate. I couldn't figure out exactly what I wanted to do. I couldn't figure out how to how to take that next step. But when I finally did, you know, it was magical, but so so how did you so going from property manager? how did how did you? How did blue lake start? And was that? Was that your first company doing syndications? Or did you have something in between?

Ellie Perlman 9:23

Yeah, Blake was the first company that I started that actually started buying real estate sourcing deals, basically reach out to investors and get, you know, raise capital and invest. After I've done property management, I realised, hey, I actually don't know much about running a business. And I understood right away that if I wanted to build and scale a company, I have to treat it like a business. And I said, Hey, the best place to buy real estate is the United States. And I remember learning back in Israel, about the concept of the self made man and I said that's perfect. I'm going to be a self made woman, I'm going to move there. And it's an also, you know, I needed a place that is going to give me the the business education that I'm lacking learning how to read, you know, financial reports beyond what I've learned as a property manager, manager, learning how to start companies learning how to how to find investors, how to deal with investors, and all of that I basically learned at MIT, and that that knowledge actually implemented towards building blue lake. But like, yeah, that's your question. That was the first company that I've started that actually, you know, bought real estate. Yeah.

Brian Briscoe 10:39

And what were some of the challenges you faced, you know, with the first couple of deals that you did with Lou? Like?

Ellie Perlman 10:45

I think one of them is one of the challenges is something that I've challenged that I hear a lot of young syndicators having to deal with, which is kind of the chicken in the egg, you don't have experience, where you know, what broker is going to want to work with you and what seller is going to want to take a chance with you, but if nobody's going to give you the first deal? How are you going to get that experience? Yeah, and, and the thing is that brokers can smell sometimes inexperienced, you know, if you're an experienced, they can smell it, it's the way you speak. It's the words you choose, if you're not using the right lingo, if you're not confident enough, and they don't want to take the chance. Because if you're not if they're not 100% sure that you can execute, and close the deal, that are not going to recommend you to the seller, and having a deal falling falling through the cracks. That's that's the not even falling through the cracks. Just falling. Just not being executed. It's the worst thing that can happen to them. Yeah. Because they can make it they can lose the deal. So yeah, absolutely. Yeah,

Brian Briscoe 11:56

absolutely. Yeah. That's it's a big conundrum. You know, it's, I reflect that on off and you have to have experience to get experience. You know, it's kind of like, say, the chicken in a, you know, which comes first, you know, you kind of Yeah, yeah, I think that's a lot. I think a lot of people have to have to navigate. How did you crack that egg?

Ellie Perlman 12:15

So there are multiple ways to do it. I would say the main way is, and you of course, can start I've seen I've seen syndicators, young syndicators, you know, basically bypass that hurdle in different strategies. One is to say, Okay, I'm just going to buy, you know, 10 units, 12 units, something small enough that the brokers are, you know, many times, not, they're, they're more flexible, when it comes to who they're selling it to. And the sellers are mostly not the sophisticated, you know, big companies, big syndicators, or institutions that are very picky about their buyer. So you can go that way and then get your, it's easier to get a nine units than it is to get 200 units. But for those who wanted to scale, and that's basically what I've done. I said, Okay, I want to start buying large properties, but no one in his right mind is going to give me an asset. So I can rely on someone else's experience. And there are multiple ways to do that. You can find a sponsor that has a deal and find a way to contribute to give some value to to that to that sponsor, or you can partner with someone that already has the experience and say, Hey, why don't we partner up, I'm going to do all the work, you can maybe loan me quote, unquote, your, your balance sheet, maybe sign the loan, maybe, you know, some investors that you can bring to the table. And when they're talking to the broker, they're presenting it as, you know, a as a partnership. And so the partnership has experienced or the partner has experience. And that way your lack of experience is just not relevant. Now. It's easier said than done. It takes a lot of practice. But it's definitely definitely you know, doable. Yeah, yeah, we

Brian Briscoe 14:18

went the the second route where we brought somebody with experience onto our team, and it made a whole lot of difference. You know, it really did once once we were able to bank on that experience. You know, now our group had 3000 doors instead of you know, zero and they all belong to one person, you know, but we didn't have to say that, you know, but ended the day. Yeah, I think the way to crack the nut, I think it's a crack the egg earlier, I just made up that term. I guess it's gonna be you know, the new hit term around the world. But the way we cracked that nut was just how you said at the end time, the second time as well as find somebody to experience you know, you find your deal you roll with it and get them to partner with you. So Something I want to ask you about is, you know, you went from I think you said 28 units was one of your first ones to, you know, the 1000. You know, what was that like going up from the smaller stuff to the really, really big stuff? And what were your big challenges there?

Ellie Perlman 15:18

And actually doesn't matter, the 28 units and the 1000s, I mean, it's the same amount of due diligence, the st you run the numbers, the model doesn't care if it's 28 or 2800 units, the only difference was just needing to raise more money. So as the deal, obviously, as the deals as larger, you need to raise, you know, you need to bring a bigger check. I mean, I think it was, it was pretty natural, I think, you know, for, you know, progression from the 28 units was bought alongside with 100 units that was nearby. So that was 100. And we manage it as 128 units. But then, you know, there's 250, and you know, and it grows from there, 400 500. It's, it's really, it's really the same 250 units or 500. It's everything is exactly the same, with the exception of Okay, can you the capital is the only difference, Can Can you bring eight or 9 million versus 25 million? Can Can you do that? Can you make that jump, that's the only difference between them, I would say actually, the second if the second difference is you're going to be talking with kind of the high calibre broker, because they're managing the larger deals, when you're looking at 5080 100 million dollar deals, you're competing with different buyers. So you're not competing with, you know, small syndicators, or maybe a doctor that has the clinic and has $10 million to put as a down payment, and he can buy $30 million deal. You're dealing with companies that have processes that have a lot of capital. So you need to understand who you're competing against, what what's your strengths, and what are your weaknesses. So one of your strengths can be, hey, we're still small and nimble, we're competing for the same deals that larger companies compete with an institutional buyers compete, you know, we compete with them, but it takes them 60 to 90 days to close because they have committees and they need to approve everything, we can do it in 45 days, 40 days, 35 days, they can't do it. So understanding who you're competing with, that's gonna give you a lot of that's going to give you the advantage you need. If you're looking at the 20 to $30 million smaller deals, then maybe the other sponsors can also execute quick quickly because their companies are also small, but maybe you have a much stronger balance sheet, maybe you can put a million dollars hard as a non refundable downpayment. And they are not as liquid. So this is where you're gonna shine. And on the larger deals on the 100 million dollar deals, someone can put 3 million not even blink because they're they have a lot of equity. So this is not going to be your strength. So I would say between the two type of you know, the size of the deal, you need to understand who's the who's the other buyers when their strengths and weaknesses in play to your strengths.

Brian Briscoe 18:27

Love it. I love it. Yeah, a lot, a lot of good information there. And, you know, it's a definitely that that was a very self serving question, because we're trying to go from, you know, the eight to $10 million purchase prices to the, you know, 20 to $40 million purchase prices, but absolutely love that. So we're gonna switch gears slightly here, Elliot, I want to ask you about your why, you know, your big burning, why, as I like to say it, you know, what's your motivation for doing this?

Ellie Perlman 18:50

I'm going to try and make it you know, short, but you know, basically, you know, I grew up very, very poor. So to get to where I am today, my why was to never experience what I've experienced as a kid. And you know, when you're the poorest kid in class, and they make fun of you, when you grow up, and you don't really have enough money to pay rent, or you need to borrow money to go buy groceries. That's a tough place. And I knew I didn't want to stay in that place. So that was my why to get to where I am. And I thought, okay, if I'm going to be I knew I always knew I wanted to buy real estate, but I thought I needed a lot of money to do it. And I said, Okay, you know what, I can become a real estate lawyer and get close to that. Because, you know, I can still take loans and pay, you know, for college and grad school. So that was my why until that moment. Right now my Y is definitely taking care of my immediate family. And you know, making sure that the people that I care about the day that they're going to be taken care of. And that's that's the most important thing. That's the thing that helps me deal with With a lot of things that happen, because when you run a company, things happen all the time in real estate, things happen all the time. There's always things that are that you don't you don't expect. And, you know, reality is it 100% is not going to happen based on what you're you underwrote when before you bought the deal is always going to be things that are going to happen. And it can take an emotional toll on you and reminding myself of of my why that's very helpful. And I think another part of the Why is the desire to create a build a company to grow the company, the satisfaction that comes with it, because at some point, okay, you have enough money to help whoever you want to help you have enough money to set you up for life. And so why do you keep doing it? You know, why do all the Muslim, you know, successful people that we know from the media, why did they go to work every day? They don't have to, they have enough for generations, you know, and so there's something at some point at the beginning, it's always because of the money when you're coming from lack of, and at some point it switches. And there's something inside of you that you're just pushing you to create, to build to move forward. Because that is very satisfying.

Brian Briscoe 21:17

Yeah. You know, I think it's about potential to I think everybody has this innate desire to reach their potential. You know, and I think that's, that's what you're looking for you You see, what, what can I eventually do? What, how much good can I do? How much can I create? What, what's the what's my limit? Hopefully, hopefully, you find that you don't have a leg up on growing and growing and growing. But so last question for you, before we bring Michelle on what's next for you.

Ellie Perlman 21:44

We recently launched to find the 100 million dollar fund we call rev fund. And the goal is really to allow investors to invest across multiple assets, multiple portfolios in markets, because the thinking is when it when, when an economy, you know, switches, different markets are going to behave differently. And we've noticed that the best properties, the best investments that perform the best for those with multiple assets in them. So that was the goal behind starting, you know, red fund. And so that's very exciting fun that we're working on, and we keep, you know, purchasing assets and adding the assets to the fund. And there's a lot of demand from investors. So that was that was a prime, it was surprising to us, because we were not sure when we launched it, whether investors would like to know exactly which acid they're going to invest in, or, you know, if they're if there's going to be any interest in a funding, we said, hey, let's, let's take a chance, it was extremely expensive to start it and we said, let's take a chance and see what happens. And the demand was actually overwhelming. So that's, that's the next thing that you know, my that I'm focused on right now our fund or multifamily fund,

Brian Briscoe 22:57

your I'll tell you, I just started investing passively a lot more than before. And I pick operators, I have, I do not pick properties, I pick operators. And I've realised that it's not the property that makes the money, it's the operator that makes the money. And I think that's what your your investors are doing is they're they've picked you as the operator, and they trust you that you're going to pick the right property name, the right property under contract, you're going to manage it properly. So yeah, I say this a lot. Any, anybody can put numbers on a pitch deck, you know, anybody can make a pitch deck look really, really well. It's the operation is going to, you know, bring the returns. So anyway, that's, that's, I'm guessing that's a large part of your success is your reputation or to 6000 per fund is your your pre existing reputation, and people thinking on your reputation on that. So good luck with that. And how can how can people find out more about that font.

Ellie Perlman 23:57

So if you basically Google my name, le Perlman or go to my website, le broman, calm, then, you know, you can read. And, you know, we have we there's a lot of information there. There's, if I'm not mistaken, we added the, you know, our latest performance report and all the previous assets that we bought and sold, and there's information there on red fund as well. So that would probably be the best way to read more about the fund. And there's an area on the website where you can leave your information now to set up a call with me personally, to discuss you know, investing. And that's that's about it. It's very straightforward.

Brian Briscoe 24:38

All right. Sounds good. All that information is shown us for anybody who's interested. Switching gears again, we're gonna bring Rochelle on the line. So Rochelle, welcome.

Roschelle McCoy 24:48

Thanks for having me. Brian. Good to be with you.

Brian Briscoe 24:50

So Rochelle, do us a favour and tell us about you Now tell us where you're from, what you're doing and why you're in multifamily.

Roschelle McCoy 24:57

Sure, absolutely. So I've Got a 20 year career in business and marketing. So and I still have a full time to be today decided a few years ago to pivot into real estate and kind of feel it out and see what it was all about. My husband and I, we've been married for over 20 years. And we've always talked about owning real estate and having some rental properties. And we just never really took action. So five years ago, we officially made the decision that we were going to move forward with it and have since then bought three, four plexes, a single family and a condo. So we've got a nice, small portfolio here, local to us where we live in Central Illinois, and now we're pivoting once again and looking to multifamily.

Brian Briscoe 25:39

Nice. So you say three, four plexes. So you got you know, 15 or so rental properties right now. All right, nice. Yeah. So how is that? How are those performed so far? doing okay? or what have you learned from that?

Roschelle McCoy 25:55

They're doing okay. You you quickly learn when you have the small properties that, you know, they just like la discovered, they don't always grow and scale at the pace at which you want them to. So you know, at the end of each year, you look at your your profit and loss statement, and you're like, Oh, well, it looks like we made all this money and revenue. But you know, we've put so much back into the property or, you know, you have a vacancy or whatever that may be, you know, one major repair, and it just, it literally wipes out your profits for the entire year. So that's where I really thought there has to be a better way. I know, there's lots of people making money in real estate, and I want to figure out, you know, what path they're on that I'm not and see if it'll work for me.

Brian Briscoe 26:35

Nice. Nice. Yeah. And like I said, I had a handful of single family properties, and I found the same thing, you know, month over month, it looks like you're making money, you're making money, and then the furnace goes out, you know, and it's like, 30 years worth of profits, you know, and then same thing, you know, I've definitely found with multifamily. And for all I can say the same is, you know, when you when you scale, those, those expenses tend to be smaller portion of the revenue, you know, so you're able to, you know, take it in stride, you know, and the one or two vacancies, they're gonna happen, and it's not that big of a deal anymore. So we're show the same question that I asked everybody on the podcast, what is your big burning? Why?

Roschelle McCoy 27:16

About five or six years ago, when I started looking into real estate, I was in a position with my current employer that the job I was in was completely eliminated. So one day, our positions were, you know, valuable, and we were helping our company meet its strategic objectives. And then the next day, not just gotten the jobs were gone. And so thankfully, there's four other people with me myself in that same job, thankfully, we were shifted into a different job immediately. So none of us were unemployed. But it was a much less desirable job. It was not the career path that I wanted for myself. And so that was really my eye opener to say, I have to have a backup plan. The company I work for is in industries that are very, very cyclical. So I'd seen you know, we have a lot of ups and downs and a lot of layoffs over the years that I work there. And I've seen it happen to other people in my company, time and time again, it it just never been me. So when it finally came the, you know, the ball kind of rolled down the hill, and it was me, I just realised I had to have a backup plan in some other way to be able to support my family if the next time that happened, or, you know, if there wasn't next time, I truly was unemployed. It just needed to have another source of income coming in.

Brian Briscoe 28:31

Yeah, yeah. So So you find that multifamily is going to give you the stability that the single family or the single family, the W two job may not in cases of you know, cyclical nature, love it. Last,

Roschelle McCoy 28:45

you have more control over for sure. versus going to a job every day and expecting to stay employed, you know, you can you can be a great employee, and you can do quality work, but there's just no guarantee there. And so I just want to be more in control of my future.

Brian Briscoe 28:59

Yeah, I love it. I love it. Well, here comes my favourite part of the show. Michelle, we got Ellie on the line here. What do you want to ask her?

Roschelle McCoy 29:06

Sure. So Ellie, I'm excited to be talking to you today. I've heard you speak at a couple different conferences. So I'm really happy that we get to have a one on one conversation. I know you've done you've got a lot of experience with capital raising, as we've already talked about today. So I've centred my questions around raising capital. I've currently got a 40 unit under contract. And that is one of the roles I'm playing on the team as the capital resource. So really, where my head's at these days is figuring out how do I do that well, and how do I grow and scale that sector, particular part of my multifamily journey? So that said, the first question I have for you is, when you're doing calls with your passive investors, what are the most important questions that you want to make sure you cover with them?

Ellie Perlman 29:55

Well, first of all, congratulations on the deal. That's exciting. During the call, I would say the most important there there few questions. Some of them are just to make sure that they're comfortable that they're interested in, in multifamily, generally speaking, because you can reach out to people in your network and you know, spend time talking with them just to learn, oh, I'm not into real estate, or I don't know, how does the syndication work again, and so the confused mind tends to say no. So making sure that they, they know that a that they they're interested in real estate, and B, that they know how a syndication works, because many people don't still don't, that's, that's going to be very crucial, because some of them are going to be embarrassed to tell you that they're not exactly sure how this whole thing, you know, works. And, you know, that's, I would say, just didn't ask the qualifying questions such as, have you ever invested in a syndication? Or do you want me to go over the, you know, the basics of how it works, and kind of explain that, you know, doesn't have to be more than a few minutes. But make sure that they understand the fundamentals? Because when, if the answer is no to those questions, are you interested in real estate? And do you know, how syndication works, has engaged in the whole process works on? They're never gonna say yes to an investment? That should be the third question. Are you interested, you know, in this deal, and it's not how I would ask it. But, you know, many times, I asked them, what's important to you in an investment, what are the returns or you're targeting, sometimes they're not surprisingly, many investors say, I don't really target certain, you know, return in terms of cash on cash or IRR, it's, you know, most of them are open to almost any market within the US. And it's not, like Brian said, it's more about vetting the sponsor. So another tip for, you know, that that I can give you is to make sure they know a lot about you, if you put information about you on on, you know, the website and make sure it's not just about the deal, because they can read about it. It's more about their their testing to see how interested, you know, they are in and how much they trust you. So I hope that that answered your question.

Brian Briscoe 32:22

Yeah. Ellie mentioned one of my favourite questions, which is, you know, what are you looking for in investment? All right, I love that question. Because, number one, it helps you on the back end to explain more about your investment. You know, so that's one of the questions I start with, you know, after after formalities, tell me about yourself, you know, what are you looking for in an investment in general, and they'll start, some, some people don't have a philosophy, but others do. And when they say this is what I'm looking for. The great part about that is you know, what they're looking for. And you can tell if your deals right for them, you know, and you can say, you know, and have the courage if the deal is not right for them to say, this steel is probably not right for you. You'll be amazed at how many people will tell you yes, it is right for me. But anyway, that's that's beside the point. That's my favourite question just because it gets them talking about what they want. And they need. And that helps you later on, determine what you need to talk about about your deal to sell it.

Roschelle McCoy 33:27

Absolutely. I love that. And yeah, sometimes it's hard getting the conversation started. But I've got I found with the investors I've talked with, as far as once you give them an opportunity to speak about, you know, what it is they're looking for, what are the what it is they're interested in? Usually, they keep the conversation going and probably reveal a lot of the questions you are going to ask anyway. You just kind of let him let him lead the conversation a little bit in that type of way. So I like that. Alright, so my next question for you is what communication channels or methods do you find the most successful in reaching prospective investors?

Ellie Perlman 34:02

That's an interesting question. Because the first deal that I had before I did my first deal, I was putting information on social media. So I kind of switched I flipped the model where, you know, instead of going and finding investors, because I started here, all my network was basically in Israel. And to be honest with you, most of them were unable to invest anyhow. And so coming to a new country and graduating from grad school, most or not, maybe not most, but some of them. Some of my classmates still had, you know, very high student loans. And they were not in a position to invest also. So I had to figure out a way to have investors that do not have friends and family to reach out to and say, Hey, this is what I do now. Are you interested? So I actually flipped the script and put content out there about real estate investing and had an in, you know, an area on my website where investors can leave informations to ask him to schedule a call with me. And at that point, you're in a very different position because they're reaching out to you, you're not reaching out to them, which means that they've already vetted you. They're interested in real estate. And they know how syndication works for the most part, because they they've done their research. So the the, the conversation was, you know, about my experience, you know, the type of assets I'm looking for. So, you know, that's, that's basically how I did it. I think if, you know, if you already have a deal, many, I would say nine out of 10, new syndicators reach out to friends and family. And it's, it's a bit tricky, because many times in, you know, investors, they need to get used to the fact that you're doing this. So you came from real estate already, you already ran properties, which is great, because many syndicators start from an unrelated you know, they have an unrelated background, that's a little bit harder to process. So that's a natural distortions, very not a natural progression, you know, progress from buying, you know, single family homes, small, multi families to larger multifamily. So it actually makes sense. And that's your track record. And that's, and that's great, because investors can basically, you know, rely on on that track record. Awesome. Cool.

Brian Briscoe 36:29

Yeah, the only thing else, I mean, just double down on that your your background, focus on your background that applies to multifamily. And, you know, you'll, you'll find it a lot easier to jump in. From what Ellie said, I come from the military to multifamily. I don't know how far apart two progressions can be, but end of the day, you know, focus on your, your successes, and use those successes to build your build your reputation with people.

Roschelle McCoy 36:57

Yeah, I really like that. Because I've, you know, now that you say that, I've got some educational content on my website, not a lot. I just launched it a couple months ago. So it's pretty slim right now. But it's, you know, you build it over time. But one of the gaps I see after speaking with you is that I really don't talk about my background a whole lot. I've got a bio, which is, you know, a couple paragraphs, it's pretty short. But I think some additional content around my why and my experience, and that I think would be a good addition to the content already on my website. So thank you. Absolutely.

Brian Briscoe 37:30

I would say take a page out of Ellie's book to look at her web page, she's got her story on there, you know, and a lot of people will look at her story and all people will look at your story and resonate with them. I think you what you told us earlier about your employment issue were very cyclical in nature. And you've seen a lot of people laid off, you've seen a lot of people lose jobs and whatnot, and you're your own change, that's going to resonate with a lot of people. And using the fact that multifamily can mitigate that risk is something that a lot of people are going to say, I've seen people in my industry have the same problem seeing people my company with the same problem. I want to do what she's doing.

Ellie Perlman 38:10

Yeah, yeah. And I would like to echo Brian's, you know, words, because many investors when I ask, What's your goal, why you know, what's important to you and investment, but also, What's your goal? Why do you want to invest with a syndicator many investors say, Hey, I have a great job, it pays well, but I don't want to work until retirement, I want to create, start building my portfolio. So I can create enough steady cash flow, that at some point, way before retirement age, I'm able to quit my job. So a story about how your W two job was unreliable, and you want to, you know, to find something that is more satisfying and to be to live life on your terms a lot of investors can find will find that very interesting. And they can, you know, I think it's gonna speak to a lot of them. And that's your story. And that's a story that, you know, a lot of them are, it's going to be it's going to really help them look at you and say, Oh, she's done what I want to do, I actually want to, you know, I want to have my income enough income to not be dependent on my w two job. So that will resonate with a lot of them.

Roschelle McCoy 39:22

I love that. Okay, so I'm going to go to my next question. If you could go back in time to when you started capital raising, is there anything you would change based on what you've learned now that you're more experienced?

Ellie Perlman 39:37

No, that's always my answer. If I would change anything, I would never change. I want to you know, I've made mistakes, I can share the mistakes that I've made, but I had to go through those mistakes, to be where I am today and to be who I am. So maybe I can share a couple of mistakes have done um, let me think Probably starting to buy a bit earlier because I thought, okay, I needed because I was putting content out there and rate I was raising money, six to eight months before I actually had the first deal, because I wanted to make sure the lawyer in me wanted to make sure that this is safe, and that you have enough investors in the pipeline ready to invest before you commit to something you may not know how to do. And I think or not be able to do and many people, I've noticed that they have to understand how to do something before they commit. And they want to know that they are 90 or 100% certain that they can execute on something before they take that step in many, many successful people that I have learned. And I'm learning them, because I want to learn how they did what they did. And to get inspiration and tips from them. A lot of them just figured things out. As they were, you know, walking through a certain path was recipe took, and they were willing to take it and they didn't wait to learn everything to know everything to feel safe before they jumped in into it. So one of the things, you know, that I think was my mistakes was basically to wait, instead of jumping in, I would have been fine. But I wanted to make sure there's enough investors, you know that I could close the deal. That that's one of the mistakes that I've done. But I'm glad that I took the time to do it. Because now I remember that you know how I felt back then. And that helps me take more risks and say, Hey, you could have done it differently. So that gives me the inspiration to take more calculated risks and understand you know, that I'll figure it out. I'll do it. And it's, it's, it's been very helpful, you know, when you know, in, in growing my company.

Roschelle McCoy 41:53

Yeah. And I've discovered that in this journey that, you know, you don't always know what the next step is. But you keep putting one foot in front of the other and the path will lay itself out for you. So you just have to have faith that faith to keep going basically. Absolutely.

Brian Briscoe 42:09

I'll just say for me, I was I was afraid. I mean, it's it's hard to say that but that was the actual word. I was afraid of what people would think. I was afraid if I called people up and said, Hey, I'm a I'm an apartment investor. Now this is what I'm doing. You know, even even before we had our first deal under contract, I was afraid of later, not doing what I told everybody I was going to do, you know, so I didn't talk to a lot of people about it. Because of that fear. You know, and I think that fear held me back a lot on that first capital raise because, you know, I ended up woefully underprepared the opposite Valley, you know, woefully underprepared to raise capital, because I was afraid of talking to people about it, you know, and then once I had my first deal, I was very happy to talk about it because we had something under contract and was like, you know, this is it, we're gonna close you know, this is but I just say Don't, don't let fear hold you back. You know, pick up the phone, call people, email, people, text people. And, you know, let people know what you're doing. You know, you'll have a certain amount of success from your website. But you know, people can go to a website, learn more about you. And that's a good, good place to refer them to, once you do talk to them. But don't don't be like me, where you're too afraid to worried about potential future failure to talk to people about it now. Awesome. I love that. I'm sure we got time for one more quick question, if you got one.

Roschelle McCoy 43:30

I do. Yes. Awesome. Ellie, what is your capital raising superpower?

Ellie Perlman 43:35

I don't think of myself as someone that, you know, I don't think I have superpowers. But I think being very vulnerable in an open with in, you know, raising money does not stop when you close the deal. When you manage the deal. You're also raising money because investors are going to look at you know, how you're communicating if when things go wrong, and things will go wrong, because it's real estate, whether you're communicating that or you're trying to mask it, and that will make their decision whether to invest with you again, whether to bring their brothers, sisters, friends, colleagues. And so I think just being very open, and when things go wrong, for instance, you know, just to communicate and not be afraid of the repercussions. So, for instance, when we bought an asset, when we put it on the contract, it was 98% occupied. About four or five days before closing, we realised that the seller was not managing the property well and the property dropped, the occupancy dropped to 82%. So we were not even eligible to get the loan because you have to be stabilised, meaning 90% occupied for 90 days to be eligible to get, you know, a Fannie or Freddie loan. And it was it was painful but being open with investors and say hey, you're investors, this is what's happening. This is why, and this is how we're going to fix it. And if you still want to end, that's great. If not, just let me know, because I understand it's not the deal you signed up for. And not even one investor wanted out. And that's because when you're communicating, they trust you, because they know things are not always going to go as planned. That's why you're being compensated, because you're taking real to take a risk. But if they know that when things are going to go, you know, when things are not going as planned, you're going to be upfront with them, it means that they can trust you. So they're going to be more likely to invest in it, and they feel comfortable investing with you. So I think just being, you know, open with my life story and also open with what's going on with the properties. That's, that's something that I keep, you know, I want to tell them the good, bad and ugly. And it's so far it's been working well. So if this is a superpower, I don't know. But

Brian Briscoe 46:01

yeah, open, open. And honestly, I've had people tell me that I'm honest to a fault, you know, you know, maybe too honest on certain things, but it has, you know, people respect that, you know, and they know that they're going to get a straight answer for from you. And Ellie, I do think that is absolutely a superpower, you know. So we're, we are about out of time. So one question for both of you, Liu, go first, how can listeners learn more about you?

Ellie Perlman 46:30

So listeners can basically Google le Perlman COMM And you know, that's my website, is where they can read about me and about the company's performance. So le is E Ll IE, and so le proman in one That's how they can reach out to me.

Brian Briscoe 46:51

Super simple. Oh, and you also have a podcast that I think is an amazing podcast ready to scale. So that's somewhere else where where people can learn more about about you. So we'll put links to the website links, the podcast in the shownotes. Anybody who's interested, go check her out. Rachelle. Same question for you. how can listeners learn more about you?

Roschelle McCoy 47:14

My website is invest titanium calm. So my brand is titanium investments. That's probably the easiest way to find me. You can look me up on LinkedIn, Instagram, and Facebook. I've got company pages on all of those different platforms. You can also search for me by name. My first name is a little tricky with the spelling, but titanium investments is probably a little easier way to find me.

Brian Briscoe 47:34

All right, well, we'll make sure we spell your name right. And it'll show up in the show notes so people can Google you properly. But thanks. I'm good enough. Well, thank you too, so much for coming on today's show. I appreciate your time. And I think this was a really, really good episode.

Roschelle McCoy 47:48

Thank you, Brian.

Brian Briscoe 47:56

Thank you for listening to the divergent 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 podcasts or email us directly. If you're still listening, you obviously like the show. So pull out your phone, tap 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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