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Forget Grant Cardone: How to Raise Money For Beginners


hey man you got an exit what you only
hit 113 on squat rack ten exit man make it a thousand we could have fit 1100 bro
who cares if you die you got ten exit bro yeah hey guys what’s going on didn’t
see you there my name is Daniel Kwok excuse the cheesy intro because I like
to be funny occasionally and I know how it gets when you’re watching these
videos right you get bored you’re probably watching this in your car right
now and you can’t even see the screen well if that’s you then that’s okay cuz
I do the same thing too and in this video we’re gonna talk about why I
disagree with Grant Cardone when he’s telling everybody to do syndication so
let’s go ahead and queue that inch but let’s get right to it alright guys
welcome this is Daniel one half of the Kwak Brothers and guys listen you know
as much as I love Grant Cardone as much as I loved his books and as much as I
loved his videos on YouTube there is something that I would respectfully
disagree with Grant in terms of what he said the last couple years to telling
everybody to do and well what hasn’t he been telling everybody to do well you
know the last two years you know I keep my eye out in the real estate investing
world and what other people are doing and I’ve been hearing a lot from other
people that Grant Cardone is telling everybody to do what’s called a real
estate investing syndication now what a real estate investing syndication is
it’s either a 506 B or a 506 C according to your law in terms of how companies
get structured in terms of entity formations etc etc but long story short
it’s pretty much when you get a bunch of people you pull their money together and
you pretty much raise the equity or the debt to be able to buy a larger asset so
you as a syndication manager or a syndicator you’re pooling a lot of money
together to buy an asset at the end of the day that’s pretty much what you’re
doing now a 506 B or 506 C paperwork may take a lot longer than a simple LLC
creation but let’s talk about why I respectfully disagree and let’s talk
about how to raise money as a beginner because guys let’s be real can we
a moment of honesty here let’s have a friend to friend talk let’s imagine here
there’s a little fireplace right between me and you and there’s marshmallows and
there’s chocolate you know and there’s strawberries and you know it’s a very
nice intimate moment and let’s say we’re just talking right we’re in my backyard
and you know we’re talking and you’re asking me about real estate investing
right ninety percent of you watching this video probably either have not done
a deal yet or you haven’t done you know or you haven’t done too many deals right
maybe you did one or two three here and there right but let’s be real if you’re
watching this video you’re probably not a multi-million dollar real estate
investor right at least by chance probability speaking ninety percent of
you probably not there yet right so that’s the part where I get a little
disturbed at what Grant Cardone is telling people to do at the end of the
day what our syndications well like I explained before if you’re pulling a lot
of more money together number one you’re increasing your chance of liability
right you’re increasing your chance of liability by bringing on more partners
in smaller increments and guys let me tell you my personal experience I’ve
been doing real estate now for about five six years and you know at the Asian
I’m at I’m doing decent right now my guys 100%
you hear you’re gonna hear it here first I’m not as successful as Grant Cardone
right I don’t think that’s a secret Grant Cardone owns a ton more real
estate than I do right but I also own a real estate investing education company
and I’ve heard a lot of my students say well Daniel I want to do a syndications
and I’m like why what I’m hearing is that you’re not taking the time to
master this craft and build your team and we’ve got a lot of people out there
that are doing syndications even despite not having taken the time
to master this craft and to build a team and that’s nothing against you guys or
anybody trying to do syndications I think I speak for myself and you and a
lot of other people when I say that at the end of the day we’re just trying to
put food on the table for our family we’re trying to build a legacy we’re
trying to get that passive income and we’re trying to create an empire right
so there’s nothing wrong with that right there’s nothing wrong with that
whatsoever and third reason is well if everybody is doing syndications because
guys cardones a large figure right he’s a
very popular individual and you know he’s kind of taken over this real estate
investing world in terms of what’s popular what’s not right he’s right up
there with the best and what worries me is that when everybody is doing
syndications and at the same time you’ve got a lot of
foreign buyers and at the same time you got a history in a moment in the United
States economy where the money is so cheap because of the low rates because
of what’s going on in monetary policy well what does that do to your real
estate investing multifamily market it changes a lot it raises up the price it
raises up the value and it puts us in a position where we’re headed towards a
bubble it puts us in a position where it’s an oversupply of capital right I
was reading an article this morning multifamily has gone up from 15.6
percent to now it’s like closer to 30 percent guy that’s a scary thing when
you have that big of a jump going into apartment complexes going into
multifamily buildings you know that’s not a good thing it raises the price and
that’s part of the reason why I haven’t done a multi-family deal in two years
because I’ve actually respectfully held off because I saw the amount of
competition happening in the marketplace the last apartment building I got guys
was a 24 unit building and I had to compete against 16 other offers now
granted I still got to deal because I was able to provide some value to seller
that not a lot of other buyers could provide because I asked questions and I
actually got to time to get to know the seller and his or her problems I was
able to get the deal but I think you guys get my point in terms of there’s an
oversupply there’s a there’s a very high competition market for multifamily and
apartment buildings which 99% of the time if you’re putting together a
syndication like Grant Cardone was telling you to do those are the type of
you know properties and assets that you’re going to go after another reason
is that typically syndications happen with individuals who have already done a
good number of deals right a good friend of Mike Joe Fairless which if you guys
want to check out his channel go go feel free to do so he’s done a lot of
different real estate deals before ever doing his first large syndication and
you know he’s kind of take the right path of educating himself and
doing a bunch of smaller deals first and in making sure he’s got the team before
doing something like a large real estate investing the Kishin deal and a lot of
people just get romantic and they get starry-eyed with doing a 5 10 15 and
I’ve heard an individual who’s never done a deal before go after a 56 million
dollar syndication deal and guys at the end of the day let’s think about what’s
going on from either and number one you’re putting yourself in a position
where if you make a mistake because guys it will happen right I’ve done a lot of
real estate deals in the past the mistakes will happen you’re putting
yourself in a position where those mistakes are gonna cost you so much more
as compared to learning the same mistake but doing it at a smaller scale first to
where you’re not destroying yourself and let’s look at the other end of the
spectrum the people investing into your syndications they’re investing their
money with somebody who doesn’t have a whole lot of experience but because
everything seems great they’re gonna invest their money anyways well you’re
putting them in a position where their risk is significantly higher right
because of the individual actually doing the deal and at the end of the day guys
what I’ve learned is the property doesn’t matter as much as the person in
the driver’s seat like that person matters so much more their level of
competency and knowledge and team building and their business planning it
matters so much more than what the property actually performs as and as
much as you guys may scratch your head when I say this I would much rather buy
a property at 5% cat break but have a phenomenal business plan and a
phenomenal team to execute it then buy a property at 10% cap rate and also you
know have a horrible team know business plan I just buy it because it looks good
100 percent guys so let me share with you guys some techniques on how to raise
money as a beginner well there’s a lot of books that I’ve read in the beginning
of my career that have really helped me raise money and helped me a study so
number one thing I would recommend people do is partner with somebody that
is already experienced and be the person bringing the money to somebody who’s
already experienced in real estate that’s
something that’s very valuable to them right an individual who has raised a
couple million or something like that right has raised money and they’re able
to introduce the investors together and whatnot guys that’s really really
helpful now obviously you want this experienced individual to actually know
they’re doing but also really high integrity so this is we’re talking to
other individuals about that person is going to help a lot and also another
thing go to as much meetups as you possibly can and ask the question what’s
the number-one problem I can help solve for you in real estate guys that’s
actually how I first raised money quote-unquote as I would go to a lot of
different networking events I will go to a lot of events in general and I got in
the habit of asking people hey how can I help you with your business right now
and eventually as I began to have more and more conversations I started having
people say well I’ve got a lot of capital right now and I want in Vettes
and I want invested into real estate I just don’t know how right and I would
set up one-on-one meetings with these individuals and I would ask questions
and get more in depth on what they were exactly looking to do with that capital
I say hey how can I be of service to you right instead of thinking about you and
yourself you know try making it about other people and their needs right at
the end of the day that’s what entrepreneurs and business owners do
they make it about them you know about other people instead of themselves right
even the best entrepreneurs they create a product or service that serves
everybody so that’s what I do guys I go to these networking events and if I’m a
beginner and I were to start off all over again and I and I didn’t know any
of my investors that’s what I would do I would go to networking events ask you
know how can I add value to them I would partner with somebody who has
already done a lot of deals who has experienced and provide the value of
bringing the cash flow of bringing I’m sorry the capital not cashflow right you
can bring that to I guess in some ways but bringing the capital all right
that’s gonna put you in a position where you’re actually able to learn how to do
deals by actually doing it by being a partner and by seeing real-life
scenarios and for me guys that’s personally how I got started in the
world of real estate investing and so that’s what I recommend to you guys so
again get nothing against Grant Cardone and I’m sure he means well but that’s
just what I would have to risk we disagree with in terms of what he’s
telling everybody to do so again guys hope you enjoyed this video give us a
thumbs up guys it would really help and guys let’s imagine that for every thumbs
up this video gets that’s how many millions of dollars you’re gonna make
this year you guys like that cheesy line but thanks again guys for watching this
video I’ll see you guys in the next one

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4 thoughts on “Forget Grant Cardone: How to Raise Money For Beginners

  1. I think most people are not interested in saving and investing for the future . While it may seem nice to benefit from your paychecks today, I believe investing in your future will lead to much larger returns and significantly improve the quality of life . =)

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