Epic Real Estate Investing - Raising Money w/ Jordan Fisher | Episode 108

Episode Date: June 2, 2014

The best education, win-win results and raising money w/ Jordan Fisher ------------------------- Download Matt's free real estate investing course "How to Do Deals | No Money Required" at FreeRealEstateInvestingCourse.com or text FreeCourse to 55678 "Click" what interests you most:  Education Properties Income    Coaching Learn more about your ad choices. Visit megaphone.fm/adchoices

Broadcasting from Terrio Studios in Glendale, California. It's time for Epic Real Estate Investing with Matt Terrio. Yeah. Hello. And welcome to another episode of Epic Real Estate Investing. If this is your first time listening to the show, welcome. Glad that you're here. If this is not your first time, welcome back.

As you already know, or if this is your first time, you do not know this. but this is the place where I teach people how to escape the rat race by investing in real estate. And you see, this is how it works. I changed one thing. I changed that one thing, just one time. And I escaped the rat race forever. And that thing that I changed was my focus. I changed my focus from making piles of cash to making streams of cash.

And that right there, that changed my life forever. So no longer do I work for money. My money literally works for me. I've heard that all of my life and I never really knew how to do it. you know, it just kind of all came together with a real change in focus and then following up that focus with Corollett action. And if I had to start from scratch, if I had to do it all over again, you know, I'd do it exactly the same way. I do it exactly the same way whether I had money to work with, whether I had a good credit score to work with or not, because I didn't have either of those when I did get started.

And because I didn't have those, I was forced to find my way through this. I was forced to succeed in this way, so I stumbled upon 12 different strategies of investing in real estate with little to no money. and in hindsight, you know, being forced to do that in that manner, I believe that made me a much better investor and I want to make you a better investor as well. So what I did is I put the first two of those strategies. I put them into a free course just for you. They are what I believe, the easiest and the fastest strategies to a paycheck in real estate. And that is available to you that it's whole and complete everything that you need to know to execute those two strategies is right there in that course. And you can get that at free real estate investing course.com.

And if you're not in front of your computer right now and you want to get immediate access to it, go ahead and text free course to 55678 and you can get those two strategies right there on your cell phone. All righty. So got a great show for you today. Our guest is a fellow investor here in Los Angeles. He's a member of the same mastermind group of which I belong. He's extremely successful. And, you know, we're going to get to know him a little bit better right now and learn more about what he does and how he does it. So please help me welcome Mr. Jordan Fisher to the Epic Real Estate Investing podcast.

Jordan, welcome to the show. Oh, thanks, Matt. I'm happy to be here. Yeah. Super. You bet. Glad that you're here as well. Sure.

We just kind of have an obligatory question, I guess, it happens with all interviews, all podcasts. Jordan, tell us a little about yourself and how you got started. Oh, boy. Yeah, you know, I run Inspire Capital. It's a private mortgage pool fund that funds, like, a lot of fix-and-flip investors. And I've been a real estate investor. I still have a big real estate investing business in L.A.

and outside of California. But how I got started, boy, it's like one of those stories. I think you find when you ask a lot of real estate investors, I certainly didn't start this way. You know, I got started a little bit in like, after a dot-com boom, a little bit in like commercial property management. So I got a taste of real estate that way and I really liked it. But then I got into like advertising and a bunch of other things

for a number of years doing like brand development, brand strategy for big companies. And eventually, you know, what's funny is my, We were always watching those fix and flip shows. I think when they were just maybe like eight, ten years ago, and my wife is a designer, and we always thought, God, we'd love to do that. And we just decided one day to do it. I got laid off, and I had young kids at the time, and I was traveling every week.

It was driving me crazy. And I really didn't want to go back to that. I thought I was going to go back to that, but we ended up buying a house locally. I'm in Pasadena. We bought a house locally, and we ended up fixing, you know, fixing it. And I loved it. I got to work on site. I got to use my hands.

I got to use some of my real estate knowledge. My wife got to design the bathrooms and the kitchens. And we loved it. That's kind of how I got started in everything. And that kind of led to like a lot of different things where I just kind of, you know, over the years just kind of add like as you, I like your intro, we're just kind of adding tools to my tool belt so I can have those streams of income rather rather than just focused on one little thing.

It's funny. The more people I talk to, the more I learn that not too many people set out to be real estate investors. They kind of stumbled upon it accidentally or they were actually forced into it out of necessity. And, you know, that, that trend just seems to keep on going and going. When you first got started, Jordan, what did your finances look like? What did your resources look like? Where was your knowledge level, like when you first took that first step? Well, you know, I'm like a, I like information. I absorb it really quickly and I really like I'm hungry for it. It's like a challenge for me.

So when I really thought about this, I learned everything I can. I would say, you know what? That first house, I really didn't. I just used my real estate knowledge and went forward and learned as I was going. I worked on the site, learning from the guys. And we know, I'd say, we need a wall here, and they would say, well, we're busy. I'd teach me how to build a wall. And I'd start building a wall, and they'd say, no, you did it totally wrong,

and they'd show me how to do it, and that's kind of how it worked. And, you know, it was great. And so that's kind of how I learned first. But then, you know, as I got, this was what, this was about eight years ago, As I really started looking for more and more houses, the market was really changing at that point. And I ran to so many distressed homeowners that I went to Cleveland and I went to Michigan and I went down to Florida where short sales and the stressed property market had been around for a long time. It was very mature there. Where here it really hadn't been around since the early 90s.

And so in Southern California, I mean. So I just kind of learned everything I needed to there. And I just took in as much as I can and associated myself with mentors as much as I can who really did that market. I brought it back here. And so when I brought it back here, I just kind of transformed my business into at that point almost all distressed sales. That's kind of how my knowledge base got started. So, no, I really wasn't. I just kind of learned from people who were already doing it, and I just kind of sought out every piece of information I could.

Got it, got it. What are your, I think the experience is the best form of information when it comes to what we do, because you just can't prepare for everything that this business can throw at us. Yes. But what do you are some of your favorite sources for information? Or what did you think you got the most from? Where did you learn the most from? Definitely from people who are already doing it.

There's no, you cannot substitute. You can't substitute from learning alongside, partnering with somebody, mentoring under somebody, somebody who's doing real business every day. You just learn the ins and out that people just don't see, you don't see on TV. You don't see when you meet someone who's an investor and you talk them about it until you're like living the business on a deal, see how the deals, work, see all the challenges, the hurdles, the problems that need to be overcome, and kind of of the relationships that kind of your teamwork, like it's a big team, you're not a solo person

that gets things done. When you really see that and you're involved in it, that's really I find that's how I kind of learn the most from it. I kind of learn, you know, from sources and white papers and other people here and there, but until I like was working alongside someone and really, for me, it's like hitting my head against the wall and I learn from my mistakes. That's kind of how, you know, the hard way, yeah, I'd probably cost me a lot of money, and yes, I probably could have done a lot more effortlessly and efficiently. But for me personally, that's kind of how I feel like I have the knowledge I have today. Got it.

Got it. Cool. So you mentioned something in the beginning. And I imagine, how long have you been doing this? How long have you been investing in real estate? Last eight years. Eight years. Okay.

So you've made this evolution to where you now run a fund. What was the name of the fund? Inspire Capital. Inspire. Okay. And so how did that come about? You know, I have a, you know, I guess a big driving, like whatever, real estate investing business I've have for the last eight years, I guess, seven and a half years at least, that has been very busy.

But at the same time, I've always felt it was fragile. I'm very good at, like, transactional stuff. I'm very good at, like, making money from a mess. And I've always used that in my business, and I have a big, like, referral network. And because of that, I've always been busy, but I've been busy mostly with a referral business often. And while that's good business, I've always felt in the back of my mind, to be honest, that it was fragile because it's based on referrals. Yes, I do marketing, but at the same time, a big majority of my business was always coming in from referrals. And that's a great thing.

But at the same time, the fix and flip business, while I like it, it takes up a lot of mind space. And yes, there's a lot of money to be there, but it does. There are a lot of moving parts. And so while I really enjoy it, and I still do a lot of it now, I always thought from borrowing money from other funds and helping my part, partner in my fund now inspire capital, helping his fund for the last three and a half years, I always thought like that's really something I want to do. Not only because it's just a different side of the business, but because I really like to coach. I coach a lot of real estate investors now and brokers. And when I lend money out, I get to coach. It's a win-win situation. I think a

lot of people don't realize when a lender lends money out. The lender actually makes more money the quicker the funds return. And the investor makes more money to quicker the funds return because the less interest they pay. So it's a very win-win relationship. So I really, once we lend money, I really get the coach and help to see, like, how's the rehab going. What do you list in the property for?

Have you gotten any offers? How are you selling the property? Because it's in my best interest and theirs to make as much money as they can, you know, as much money as I can for them. So that's really why I moved into the fund business because I certainly have a network of real estate investing friends, like you Matt,

in our mastermind group and a bunch of mastermind group I'm in. And we fund a lot of those people, and it just makes a lot of sense. Right. Right. That was a little bit of a self-serving question because I think I have somewhat of a tip or not a typical, a similar progression as you is that very much up until, you know, this point, very much of my business is referral based. And I love it. It's awesome, but it's, it is rather unpredictable and it's a little bit scary sometimes. Yep. You know, the money's still good. I'm not complaining about a thing. I love the referrals and I love working that way. But it is a little bit. what do you say, fragile.

Fragile, opportunistic and fragile, yes. So, yeah, I'm on the tail end of finishing up my fund as well. And so I'm very excited about that. So I'll probably be picking your brain along the way and asking for your help there if you're so obliged. Very good. Thank you. So is that what your primary business now consists of? Is that what that looks like today is just funding?

I both. I have still a real estate investing business. you know in in Los Angeles in Nevada and in the south some of the southern states where cash flow is really high and then I have the fun stuff yeah where I'm just raising money and funding a lot of investors across the country both the California Florida but also around the country so that's right my that I guess that is more and as you were talking in the last question that is more if a being a lender is much more passive it's really active in terms of I'm engaged and I'm actively

involved in helping our clients be successful but it's not as much of the brute force, let's say, as maybe a fix-and-flip project is. Mm-hmm. Okay, so if a big portion of your activities now is out raising funds, and I know that's a big concern for a lot of people getting involved in real estate because they think they can't do it because they don't have the money. Yes. So coming from someone that spends a lot of time raising funds, how do you go about it?

That's a really good question. I mean, mostly I find, what I read a book recently, I read a book recently, It's called The Power of Who, from, let me think who that's by. That is by Bob Bodine, and a friend of mine in another mastermind group recommended to me, and Bob Woodene spoke there, and it was all about, like, you already know everybody you need to know. It wasn't about cold calling. It wasn't about sending out cold letters. It wasn't about going to a networking event to meet people who you haven't met before.

it was all about just letting people who you are close to let them know what you need. And if they don't have it, let them find it for you. And so I find a lot of money that I raise typically is from people I already know or their associates. So I think that is the lowest hanging fruit is the best way to do it. And then also, of course, you know, I work right now, I work with a lot of money managers who have taken their clients, taking money off the stock market for their clients. They're just looking for very secure passive income streams for them. So I do a lot of that, like a lot of education about how to buy properties with your retirement account,

how to earn passive income versus buying real estate and owning real estate on the title, things like that. And that kind of thing is just more educational kind of brings in funds. Right, right. Okay, so from the other side for when you're out lending funds and, you know, who is the ideal client for you? and then I guess ask that answer, who, you know, do you shy away from? Definitely. We definitely shy away from someone who's green, someone who's a novice. We only work with season investors or people who we've already worked with

or people who are referred directly to us. Okay. And there's a real reason for that. It's not that I don't want to help someone do their first property. It's just that, you know, I need to mitigate the risk. As a fund manager, I need to mitigate all the risks I can. When I'm working with someone's season who treats any money lent to them as if it's their own money and works quickly and efficiently and is not going to run into unforeseen problems who are very proactive in getting things done,

and when a problem comes up, they know how to solve it. That just mitigates the risk and returns the money quicker. So for that reason, that is the reason that we invest. So that is typically the person I'm looking for. But I must say that even though those are the people that we do lend to, in terms of selling properties and making the properties move quickly and turn quickly, that is still, I find, at least among real estate investors, that is a big problem that real estate investors might be very good at attracting properties or marketing

properties and even rehabbing properties. But in terms of selling them, I just find that they tend to be terrible. I see what you saying. So their exit strategy is where they suffer a little bit. They may have an exit strategy and it might be the right one, but in terms of understanding that everyday, every day costs money, every day cost money to them, whether it's in private lender interest, whether it's in utilities, insurance, possible vandalism, anything regarding the house.

Right. They just, you know, I think they're just used to, you know, used to giving it to a realtor and letting the realtor work their magic, which is very insecure. Right, right. Definitely. Okay, so you shy away from green investors, and there are a lot of green investors, quote-unquote, that listen to the show, and they're looking for money and they don't think they can do because they don't have the money. What would be the things that you would recommend to

them to do to get ungreen? Partner with people. Like we do a lot of that. We do a lot of JV partnerships, joint venture partnerships. So if it's someone's first deal, I would say partner with someone who's done a bunch of them. You can even partner with like a fund manager like for me or my partner or someone like that. We do that sometimes. We will partner with someone just so we have a little more control. Yes, that person maybe they're not in full control the deal, and yes, they're not going to make as much money, but at this point, it's not about one deal. I preach that more than anything. It's never about the deal, one deal. It's about building relationships. It's about keeping like your pipeline full. So if it takes a deal or two or three to really understand how the process

works and how to speed things along, how to solve problems that come up constantly, I think that's a fantastic way to start. A lot of people I find they just want to start and run and think they can do it, or they've taken a course and think that they can just go. Or their numbers are just so confident their numbers when they're really just not looking at it. They're not doing their proper due diligence to find out what the real numbers are. I do a lot of that. We evaluate a lot of deals that we just don't fund because the numbers just aren't real.

Right. So their analysis is off based on after you follow up and check their analysis. Yeah, it's optimistic best case scenario. When I'm looking at things from pessimistic worst case scenario. Right. Only because I have to. from a fund standpoint. Cool.

How many people do you have working with you? Just on the fun side, we have like an administrator, and we have a couple loan processors, and myself, my partner, it's not a big staff, and my real estate investing business is myself, and I have a couple people who help me regularly and a couple people I bring in every time we do a deal. Cool.

So now that you've started the fund, and that's been up and running for how long? Just since this fund, just since October of last year. Okay. So it's relatively new. Have you noticed the fragility of your investing business dissipate a little bit? Are you noticing some more stability? In my investing business, just because I'm in Los Angeles, I think the inventory is still so low all around Southern California that it's, I guess we've been concentrating outside of L.A. a lot now.

We still do things in L.A., and that's where kind of the referrals come from, because obviously they come from here. But we do a lot of marketing outside of L.A. because I just think there's more opportunity. Sure. So I don't know, it's just a really changing business right now because the market is really flat, but inventory is still low. Right. So I think you just gotta be a little, I'm pulling like other tools off my tool belt and trying to find ways to work with motivated sellers.

Right. What are some of the ways that are working best for you right now? Options, like giving people options. I've never been one to, well, no, that's not true. That's not true. I would say for a long, no, for a long time in my real estate investing career, I was just making offers tons of offers on properties. And they were low-ball offers, or they were offers that I need to get on whatever they were,

usually distressed properties. Now I really don't do that. I really give people options. I will give them maybe a low-ball offer. I will give them, especially I'll go after properties that have some equity in it. And I'll work with a seller in terms of doing seller-financed deals or equity-split deals or things like that. So my low-ball offer is still there in cash, close quickly, but it's not my only offer.

So instead of pissing a lot of motivated sellers off because I'm, I'm making a low offer. I'm giving them options that might work for them. And when they can see options at different prices that are some more appealing to others, it shows that I'm willing to work with them and I can do whatever makes them happy. So when I do that, I just have much better conversations with sellers, and it tends to lead to more business. It might even not be about that house.

I think just think when you build relationship with sellers, you might find out they own three other houses. Right. And this one might not work, but they may own and have another one that they didn't even think about that they're willing to sell you that that might work. So I do a lot of that. That's so true. You know, when I got started, that's exactly how I did.

I used this three-option letter of intent, and I'd have this lowball offer, this mediocre seller-financed offer, and then another more of aggressive seller-financed offer. And, you know, the market kind of shifted, and I didn't really have to use that tool anymore. And I just started using it again at the top of the year, and it's probably added two more deals a month to my deal flow just because of making options. And I didn't know that about you. Yeah, very interesting. Yeah, I can understand that. Yeah, and like what you just said is sometimes they don't even pick any of the options, but it does keep the dialogue going.

They're more receptive than, and you do eventually find a solution that works for both of you. Yeah, you know, I often find, too, if you have a lot of listeners who are, who are, they haven't bought many properties or they're trying to buy their first one, I think sometimes, and I can speak to this directly from, from working with distressed properties. When I first got started in real estate investing, I was doing all short sales. I became known as the LA short sale guy. That's how, in fact, hundreds of realtors in Los Angeles still know me by.

Even though I buy short sales, that is not my focus at all. So you're the one who had that domain name? Yes. Because I did go for that. Oh, yeah. So, yeah. So, but because of that, you know, to be honest, when I first started, I questioned myself a lot. I said, you know, someone's losing their house or they're just distressed, they're in a bad situation, whatever it is.

And am I taking advantage of them? Am I buying their house? that I'm a good deal for me and I'm making money while they're losing out. And even though I knew that wasn't the case, internally, I actually struggle with that for a while. And you know when you struggle with that internally, it comes out in your tone. And until I really internalize that and felt in my heart that you know what, I'm really helping these people. I'm the best solution for these people.

I'm looking out for their interest. I'm trying to make it work the best I can. If I didn't come along, someone else would who's not going to take care of them like I would and not make sure that they're getting the best feel they can. When I really felt that, all of a sudden, my words didn't change, but my tone changed. And all of a sudden, I never, ever had a problem with a seller. And I think that's really important for people getting to real estate investing when they're making lowball offers or think that they're just trying to get a deal from somebody. You really have to feel and internalize what you're doing and how you're doing business.

And it is a business and that you're really helping. That really goes a long way in terms of your tone and your relationship you build with sellers. Right. I always felt that an investor's income certainly is in direct proportion to the number of problems that they solve for people. That's a good way to look at it. Yeah, absolutely. So what's your deal flow? What's your volume right now?

How many deals, I guess, a month or a year are you doing? You know, I've been really focused on the last probably two and a half years. I used to do a lot. I used to do a couple hundred a year a lot, maybe three, four years ago and before. In the last couple years, I've been focusing on fewer, bigger, more. more profitable deals. So I try not actually, I try to reduce my volume and just focus on ones that are really home runs that I know are extremely secure, that are really, it's really the best return on my time. I think that's what, you know, after being so busy in real estate investing

on that side and being taxed to the hills, I just realized that I needed much more, I needed more passive income streams like you said, I needed more streams of income. And so I really worked on, Well, if streams of income, what is the, which things are the best, what streams of income or what opportunities utilize my time the best? What gives me the best return of my time? One of them was the fund, being a lender, great return of my time. One of them is my fix and flip business. Maybe I shouldn't do it all myself.

Maybe I should partner on almost all the deals I have. Maybe I should bring other friends or real estate investors into every deal I get. Do less work, make less money. We both make money. It's always fun when other people make money more than just you. And when I do that, guess what? I attract more deals. Other people want to partner with me.

So it just keeps things like moving, and I think as I move more towards that, I'm really happy, like maybe the volume has gone down, which on purpose has gone down, but I'll tell you what, it's a lot more, it's a lot better return of my time

and to be honest with a lot more fun. You know, when you're a real estate investor, sometimes it can be very lonely. Sometimes, even if you make money, it can be really lonely. Because you raise your hands, say, hey, I just made money, and everyone goes, well, who cares?

Right? You made money, and no one else did. So who cares? You know what? But when you make money with other people and you bring other people in the deal, boy, I'll say it's a lot more fun when everybody makes money.

That's one of the reasons I like being a lender. The fund makes money. The investor makes money. It's a good deal for both parties. Gosh, it's amazing that we live practically across the street from each other. And we're at very, very similar. I mean, everything you're saying around, we're at a very similar place in our careers.

It's, I mean, it's almost uncanny, really. Yeah, so it's nice to have met you, and hopefully we can hang out a little bit more. Yes. Let's see. So what do you see for your future, I guess? The fund is really a big thing. I really enjoy that, and so my goal is still like to raise a lot more money for the fund. We establish a pretty big fund and pretty broad fund that can do a lot of things.

And so my goal is really to keep raising money for that fund to make that work. But I also like – I just love – and part of just being a lender, has confirmed, I guess, what I was already feeling that I just really love working with people. I really love coaching people. And so I really like to coach investors and even real estate brokers on a broker as well, how to like sell properties for more money in less time with ultimate control. I just love that. I really like to do that.

I don't like teach a course on that. I presented a bunch of things on that before. I constantly asked to do that. but I just really love doing that. I think that's just a lost opportunity. There's so much money and time and stress and opportunities left on the table when selling properties that I think could be capitalized on if just had the right instruction.

So I really like help. I love to educate people about that. Got it. What do you see the, you know, you were talking about the market nationally? I know it's probably a tough question to ask as a blanket answer, but what do you see nationally? What do you see it's going on with the real estate market right now? You know, I think it's still like a really local market.

I think it really depends. The hardest at markets, you know, the Las Vegas, the Florida, is the Phoenix. Even the SoCal, you know, have gone up so much in the last year that now they're pretty flat. You know, they're not really moving anymore. In fact, they may be just slightly dipping. And so I don't see that really going up anytime soon. So that's what I see in those.

I know around the country where it really didn't dip too much, kind of doesn't move too much, kind of follows these other markets. I know there's a lot more inventory where these hardest-hit markets, the inventory is still pretty low. So, you know, it's hard to say I just know in the markets that I work locally, I mean locally like the Southern California market, the Vegas market, and the South. They're really different. Vegas and California, Southern California are pretty similar, but the South is really different.

Right, right. Cool. So awesome. If someone wanted to get in contact with you, they like what you're saying. and it's resonating with them and want to explore mutually beneficial business relationships, how should they go about contacting you? Yeah, they can just, you can send me an email if you want at Jordan, J-O-R-D-A-N, at inspireinvestments.com, INS-P-I-N-SpI-R-E-E-E-E-E-E-E-E-E-E-E-E-E-SOM, or you can call my office, 626-7-88-9700,

feel free. I'm happy to talk with anyone. That's what we do a lot all day. All day, to be honest, is I'm just looking at deals, whether for my real estate of investing business or that clients are sending us looking for funding.

I'm evaluating deals, and I'm not evaluating deals to say yes or no. I'm evaluating deals to say, like, here's what we can do. I think it's a great deal. I think you should walk from this, or I think you should try other options to get a better price,

or you might want to explore it differently, or I saw your rehab scope, and I'm not sure why you're playing I'm spending this much money in this project. Like, I really like try to help that way because it's really fun for me, to be honest. And the more I can help, the more we end up lending money and the more money our clients make. One of the reasons we call our business-inspired capital is because, to be honest, our clients inspire us. And I hope that our involvement in their success inspires them.

That's great. Great. Awesome, dude, Jordan. It's a pleasure to talking to you today. You too, man. Likewise. I guess that'll do it for today, but let's do it again. Cool.

Cool. All right. I'll see you, I guess, in August in Tampa. Are you going? Yeah, for sure. Okay. Great. Thanks for being here, bud, and we'll talk soon.

You got it. Thanks, Matt. You bet. Bye-bye. Bye. Okay, doke. So that's it for today. I'm Matt Terrio, living the dream.

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