Hi, this is Tom Soane and welcome to another episode of the Anonymous Landlord, and today, I am really pleased to welcome back Antoine and Karen, who are real life, not only investors but they also teach people how to get investors for their property deals.
Now, just to add a little bit to that. If you are somebody who wants to invest in property and you find loads of property deals, you just wish you had a bit more money to be able to buy them and refurbish them or redevelop them or anything like that.
These people are the ones that not only could invest in you or connect you with people that would, they’ll also teach you how to find investors that will invest in your property deals and those people, these people are like absolute gold dust.
So I’m very pleased and thank you very much for giving us some of your time to educate us on this part of the world. So welcome along.
Thanks Tom. Thanks for having us again. I don’t remember when the first time was probably a few months ago now. They’d say it’s good to be back. Yeah, definitely. Great to see you again, Tom.
Yeah, you too you too and last time we put a lot of effort into talking about Antoine and Karen the investors and what you would look for, personally in property, deals and developers and anybody that’s investing in a property for you to be able to invest in them.
But now, I’d love it if everybody listening to this could come away from this episode knowing things like what should I include in a good or a quality investor pack? What training can I get to learn how to go and find investors to research the right information to collect and present the right information so that I’m guaranteed to get funding for my property deals.
So it’s a bit of an open chat, but let’s start off with you are the founders and directors of Quality Investor Packs, right?
That’s absolutely right. Yeah and it started by being private investors, you know, like we, like we talked about in our first conversation and what happened to us is we were looking for property developers to work with, we’re looking for investment opportunities and we quickly realize that there was, there was a big gap. It was a big knowledge gap and the best example of this was investor backs.
We’ve seen investor backs of all sorts and most of them are raising more questions than provided answers and that’s how we started helping people out with our investor backs and make them suitable and make them work for private investors like ourselves.
Brilliant. And I think a lot of people miss this part, don’t they, they they they go around networking and chatting to people that might have a lot of money and then they’ll say to them, hey, look would you you invest in this deal for me, invest in this deal it’s brilliant is never going to go wrong. It’s fantastic. It’s going to rent for this much money every month and it’s going to I’m buying it this much below market value. Please invest in me, and that’s kind of where a lot of people go wrong, right?
Yeah, absolutely. I mean, so I, you know, I would say that they are two things wrong with that approach.
So the first one is that, you know, you’re potentially breaching FCA financial promotion rules because you’re going around asking for money and you don’t know who the person that you’re speaking to is.
So the FCA Financial promotion rules state that you can only make a financial promotion to investors that fall within an act exempt category and that’s usually high net worth investors and sophisticated investors.
So really, you need to be sure that your audience fall into one of those category before you ask for money. But secondly, as you just pointed out, that sort of approach is really the kind where you just throwing mud at the wall and hoping some of it would stick, there is no process to it, there is no plan to it.
So it will become a really time consuming strategy for the one of the better work. You just go around speaking to random people and hoping that one of them would turn around and say, you know, yes, I love to be investing your deal. So like everything else in life, you know, if you have a plan if you have a process you know it’s going to be much easier and better for you.
Yeah. Couldn’t agree with you more and you know, I speak to a lot of property investors that want to get into property investing and on there on the part of trying to find the property deals and really what you do is open up, well not just you but just by doing the right in, presenting the right information, collecting the right information and presenting it to the right investors. You can do so many more deals and so many more get yourself so many more properties into your portfolio and increase your income and do all of those wonderful things, become financially free that everyone buzzes on about, you know.
So, okay, let’s just quickly try and summarize if you can, what is an investor pack?
An investor pack is the marketing brochure that you are going to use to sell yourself your business and your deal. So that’s the document that’s going to showcase you know you, the way you work, what you’ve done in the past, you may be completed projects, your case studies and then at some stage, a live investment opportunity. So live deal that you are seeking investment from a private investor for.
That’s a really good answer because in there, you said, the way that you it’s a sales brochure for yourself to present yourself and, you know, I think a lot of people correct me if I’m wrong but a lot of people try and sell the deal first. But you as investors you’re thinking well okay, if you’re asking me for a couple of hundred thousand pounds, who are you?
Yeah, absolutely, Tom I think you hit the nail on the head there and he actually ties in with the earlier question that you have, that one of the things wrong about going around asking people, if you would invest in project that you have is that you haven’t taken the time to build a relationship with that person and a business relationship you know, we usually like and it to that of a romantic relationship.
So if you were looking to go out with someone, you would obviously start off by going out on a first day, then possibly a second and third before you eventually get to the stage where you might, you know, proposed marriage.
So asking someone for money without knowing them, it’s like proposing marriage on the first day, and many people don’t seem to grasp that concept, you know, you wouldn’t do that if you’ve just met someone that you’re attracted to but then it seems to be completely fine to walk up to a stranger and go, you know, do you have 200,000 because I like you to part with that money today and that is just not the way to go about it.
So more than anything, you know, what we really teach is the fact that you need to build relationships and you can do that through your investor pack. It sounds one highlight that is about selling you and your business first, and foremost before, moving on to the deal.
Yeah, really good point and you said earlier on about, first of all, you’ve got so many different hurdles. If you’re just going around Facebook groups and putting deals into Facebook groups. Say, Hey, I want funding for this and you know the chances of getting funding that way of slim to none anyway, but if you’re then promoting financial deals to investors, you run that risk of falling foul of the FCA and so that’s a really good point that everybody should take note of and that can that can stretch across so many different things.
If you’re just saying to someone, you can get this yield, this return on investment is going to be this much cash, you’re going to get this back in this time then that is financial promotion, right? That’s it but also, yeah, really good point.
If your look there are going to be those people that have a friend who is wealthy? That’s happy to invest. Okay, that’s fine. But that’s kind of what you’re saying. They already know each other. But if you are an investor and you have been offered, I don’t know a block of 10 flats that you’re going to buy it, you’re going to refinance it, and then keep it and rent it out.
Then if someone’s going to invest in that and fund that, then they need to know you. Know that I mean, that’s a really good point and I’m glad you brought that up.
Yeah. I mean put them in. Put yourself in the shoes of the private investor. Yeah. How would you behave? How would you feel if someone was coming to you and say, look, this is what I need, this is who I am, this is what I do and this is what I need. So how long would it take you to be comfortable with that person comfortable enough to actually seriously consider investing in a project with them and you know, use the information. Here’s how you feel to actually build a realistic plan around it. And that’s going to involve like how much how early you have to start looking for investors before you even get a deal because, you know, it’s going to take awhile. It’s not gonna take a few days. it’s going to take minimum a few weeks, potentially, a few months, sometimes, even longer depending on the investor that you’re talking to.
Yep. I agree. Couldn’t agree more. So okay, let’s put this into a scenario and we’re going to get into a bit more technical stuff in a what in a minute. Because I’d like to really learn a bit more about the training that is available to anybody that wants to attract investors and do more projects, property projects but can you give me a quick idea of as an investor if I came to you and I said, right I’ve been offered this really good opportunity and we already know each other or no let’s say we don’t know each other but I came to you and I said I’ve been offered this really good opportunity to buy again I’m using the same example of block of 10 Flats which they need a little bit of work doing to them and I’m buying them below market value, and then I’ll be able to refinance them and get all of the money back out, plus a bit of profit, pay your investment back to you plus interest.
So it’s a really good deal. It’s a safe, secure deal, right? Yay, how would I come to you and present that to you in a way that you would find appealing and can you include in your answer something about the exit strategy that appeals to you when it comes to buy to let or BRR, I call it flip to let, buy, refurbish, finance. There’s a question in there somewhere.
Let’s let’s break it down. So first of all, you know, I will number one advice is don’t lead with a deal. So let’s take the deal out of the equation for now and let’s focus on building relate, the relationship. Damn it I already failed. And wanting to build. When we say building the relationship, we, it doesn’t have to be necessarily very time consuming and it doesn’t have to be, like, loads of calls and all of that, you know, the investor pack. Can I help you build that relationship because what you want is you want your investor back to do a lot of the talking for you. Most private investors are going to have the same questions.
So what you want is your investor back to capture the answers to most questions that private investors would have?
So start by building a relationship. So don’t mention a deal even if you have a live deal, don’t mention it. If you mention a live deal to someone, they’re going to feel the pressure, okay and their answer is to be impacted is going to be affected by that and chances are, they’re either going to tell you no or they’re going to do a very British thing of, you know, giving you the silent treatment and not saying no and, you know, saying maybe but it’s actually means no and, you know, it’s not helping you in any way, right and that’s that’s not that’s not something anybody anybody wants.
So build that relationship first, but let’s just fast forward. You know, you’ve sent the right information to these people, you started building that relationship and the investor that you’re talking to is comfortable receiving and talking about live investment opportunities and you’ve also made sure that the compliance compliance boxes are ticked. So you’ve made sure that you’re talking to high net worth or sophisticated investors. So, this is done.
Now, let’s move on to the deal. So the first thing you want to do you want to ask yourself is how can I structure the deal in a way that’s going to work for me?And that’s going to work for the private investor and the same time.
So you we talking about buying homes in this case. So what you want to figure out is what sort of involvement. So first of all, what’s your objective is what your objective is for the long term? Are you looking to hold for just a few years or also the very long term, you know, what’s your plan and how you want investors involved.
So let’s imagine you, you buy a block of flats, you’ve got some work that needs to be done to, to the flats. In that block. Meaning, you’re going to increase the value of these flats. And the plan is for you, just you, the the property investor the person who’s buying them to just hold them in your name and just you.
So you’re only interested in getting a private investor for short period of time, just to pay for, you know, the refurb works or to help you with the deposit to go with a bridge to go with bridging finance.
So what you have to make sure is that the deal allows you to repay the investor when you’re going to exit it. So when you’re going to refinance on to a buy to let mortgage for this block of flats.
So you got to make sure there’s enough money in the deal to repay the investor along with the interest that you have to pay them if it’s alone or with a share of the profit, if you if you’re doing an equity investment, let’s that’s one way to look at it, kind of a short-term investment opportunity where you, you know, you’re buying a block of flat and you want to keep it just for yourself.
Now there’s another way to look at it and it’s more of a joint venture long-term joint venture type of arrangement where you are building a portfolio for yourself as well as the investor.
So the both of you together, you’re going to be owning properties and in this case, you’ve got more flexibility because you don’t have an end date.So you don’t have have a, you know, a date by which you have to repay the investor, the cash that he invested, you are in a joint owners in a project, you investing some money and maybe your exit strategy is to sell the portfolio in 15, 20 or 25 years and that gives you a lot more flexibility, but it’s a different type of investments for private investors. So, you know, it works for some, doesn’t work for others.
So that’s something that you have to figure out when you, you know, when you putting it all together, when you’re looking at a deal, when you putting the investor back together and when we, when you reach out to these investors, that you’re trying to convince to invest in your project.
That’s a really good answer and really good advice there about how you see the exits as well. Short-term, long-term, joint venture and I think a lot of people will take note of that because look, there’s a lot of people that want to build portfolios and achieve that rental income and the profit that brings as well as a bit of capital growth as well and and what you’re saying if you’re going to do a joint venture with a property investor where they fund the purchasing and the refurbishments, but the joint venture could be, that the property investor is repaid a percentage of the net profits to cover their expense, to cover their interest, and their interests and then you can take the rest.
So and I’ll put that into an examples and and sorry to waffle on a little bit here, but I’ll put that into example, if you find somebody that’s prepared to finance your property investments and they’ve said to you, that all I want is 10% per year on the cash that I lend, and you can go and find property investments that return 15% on on the cash that’s invested in the properties. Then you pay your investor 10%, they’re happy and you keep the 5% for yourself and that’s technically free money and would I be writing, summarizing it as simply as that as that’s one option?
Yeah, so you have it has to be, it has to be attractive and palatable to investors and I think the downside of doing it the way that you suggest is the security that you offer to the investor may not be very clear. So, you know, if you go on a deal by deal basis as opposed to, you know, just borrowing money and then using the money to build your portfolio, I think it makes it a bit clearer for the, for the investor to know what what the exposure is, what the risk is and you makes it a lot easier for you to be able to offer security to the investor.
So that could be, you know, first charge on the property which is the best security out there in property investment world and, you know, that’s going to be, that’s going to be one of those things that, you know, that investors are going to find very attractive.
If you start telling them, I can offer you first job security and a personal guarantee. For instance, then the savvy investors would understand, you know, what’s going on in the market. The value of security are going to be are going to be attracted to that.
Yeah, that’s that’s very good point and really we’re all property investors so you’re only going to invest in something with with that security and that’s going to match your own comfort levels isn’t it? If your, if your comfort level is higher risk for higher return than fine, maybe you’d look for slightly less security, but if your comfort zone is to have things that secure safe investments, you might make a little bit less money but you’ve got much secure, much safer Investments.
Okay, so now that I know that your business Quality Investor Packs. There are a lot of people that probably won’t fully grasp what the quality investor. Sorry. What an investor pack actually is and there are probably a lot of people that think they don’t need one. They could just go and give the gift of the gab and just chap chap chap and and win people over.
But I firmly believe that actually to learn how to use an investor pack properly and put it together properly is fundamentally invaluable to any property investor that wants to move on to bigger and better things and leverage other people’s cash to grow portfolios, and build income and so on.
Now, I know that you give a free download, don’t you? That’s right. Yes there’s free investor pack template and for other free resources on our on our websites on raising investor finance in general and invest attacks in particular.
Yeah and look, this isn’t a sales pitch by the way, actually, Antoine and Karen a very kindly come on to just try and help educate property investors and investor landlords on how they can grow and how they can do bigger better things. But I do think that everybody who is into property in any way should go on to your website and absorb all of the free resources that are on the, you probably give away a bit too much if I’m honest with you. But you want to tell us your website address. Yeah sure our website address is QualityInvestorPacks.Com so all one were quality investor packs that’s in the plural.com.
Thank you. Okay, so that’s perfect. And so from here, if someone is looking, right so let’s say we’ve got a standard property investor. They’ve been doing it the old-fashioned way, where they’ve saved up a bit of money, bought a property, using their caches of deposit and they’ve rented it out and they’ve got a little portfolio of properties.
Now they want to take it to the next level. Maybe they’ve carried on in property, and they found this mysterious block of 10 flats that we keep talking about. They’ve been offered this, this properties like that or they found properties like that, and they keep seeing them everywhere and they think, I wish I could afford that. And then they hear this podcast, where Antoine and Karen are saying. Well, actually, you can afford that if you do it the right way.
So this person, now this, this hypothetical person is now thinking I want to learn more about this. I really want to start training and learning and developing myself on working with property investors, sorry. Working with investors to generate more property opportunities to grow my portfolio. Where can they learn, what can they learn and what do you guys teach?
Right. So we help property entrepreneurs create quality investor packs there that will lead investors wanting to give them money for their property projects. So that’s what we specialize in and alongside that we also help property entrepreneurs with all aspects of working with private investors. So as we know you’re working with a private investor is not just contained to the investor pack alone. There are a lot of other bits that go around it. So just you know communication so investor relations is an important piece.
So we’re putting together different resources at the moment to help property entrepreneurs with all of that, but our main focus is on the investor packs because we believe that that does a lot of the talking for you and having a good one in place, we just make your life so much easier when it comes to fundraising.
And once you’ve done an investor pack, am I right in thinking that once you’ve learned how to do an investor pack because you could download a template and you could try and fill it out yourself. But that’s the, that’s the same as downloading the ingredients for a McDonald’s and then trying to make it yourself, it’s just not the same thing, right?
You could do all of that and I do urge people by the way, to get onto the website, QualityInvestorPacks.com and download that template at least. But from there you can really get into how to put it together deal by deal, and person by person, investor by investor. What sort of differences do you think there might be or what sort of tips would you give someone in making that investor pack and why would somebody choose to train with you on putting those investor packs together?
Yeah, so our top tip on creating investor packs which we tell all our clients is that reading your investor pet should be like having a conversation with you. We want to see your personality shine through, you know it should just be a reflection of who you are because it doesn’t make sense if you have any investor pack that doesn’t sound like you at all, because at some point you are going to be jumping on a call or meeting the investor face-to-face and what you don’t want to happen, is that disconnect where they go, you don’t sound at all like that, you don’t act on what you say.
So it’s really important that it sounds like you, which is why the support and training we provide is very much focused on the content. So we provide support on you know the cut type of content that you’re going investor pack but it’s all created and written by you because it needs to sound like you.
So we provide we show you good, we show you bad examples and the idea behind this is the good examples will inspire you to give you an idea of what to write. Any bad examples, will show you exactly what to avoid. But we highly advise that they never just copy blindly word for word because when you do that, you’re going to get disconnect, you know, in different chunks being from different places and it’s not reading well because we’ve seen investor packs like that when you read through it and you go like this is not all written by the same person and it just doesn’t flow.
Yeah, that makes sense. I suppose that’s the same with everything, isn’t it? When you get an email from somebody that you’ve been talking to you over and over again and their email is is written in I dunno, 1900’s English because it’s trying it’s trying to be Shakespearean almost and you and you’ve just been speaking to this person and they sound just like a regular person and then they start using big long words and all of those things. So I agree with you, definitely agree with you.
What about then if we were looking at do you think it’s worthwhile going to this length of Education and Research and collecting of information and presenting of information through an investor pack? Is it worth it for somebody who’s just looking to do a buy to let or a flip to let where they can buy it below market value, add a little bit of value and then refinance it and pay, pay off any borrowings that they’ve had? Is it still worth doing it on those bases?
Yeah, anybody was looking to scale their property business, then it’s definitely going to be worth it for them. If you’re serious about property, if you want to get more deals or if you want to do better deals, a bigger deals, sorry. Then that makes sense because you want to, you know, we were talking earlier, you need to have a plan, you have a process and an investor pack is going to be you know the key part of that process. That’s going to help you do it with less effort, less time and quicker and better.
So I think yeah. It’s really important to have that nailed down yeah. It’s about also professionalizing your business. So if you’re looking to take your business to a professional level, you know having a good investor pack gives you that extra edge because as investors ourselves, you know, when we were looking for investment opportunities, a people who prepare a good document certainly caught our attention over someone who would give azim, give us information over random text messages or an email here or maybe I’m going to suddenly share you share with you a link to my Google Drive.
It’s a lot of effort on the investors part to try and piece all that information together and say you know we will have a combat conversation over a number of months. So at some point when Tom said you come to me you know you found that magical block of 10 flat and I go okay, great you know, I want to look back on what Tom and I have shared in the past. Having any investor pack will make it really easy for me to revisit the information that you have provided to get me up to speed. You know, with what you have told me, you do what your business does and you know is this a viable option?
Imagine if it’s all scattered through emails, texts and maybe in a coffee meeting, you’re relying on the investor to keep track of everything you have said and that’s likely to lead to mistakes or perhaps investors, just losing interest because you making it too difficult for them to make that investment.
That is such a good point and that is is one of the key points. I’d like people to take from this in that if you are asking somebody for money and you’ve got to make it easy for them, they don’t owe you anything and in fact there are more people that want money than there are prepared to lend money.
So actually a really good point there and I think I think the last part I’d like to end on is is of course, I want people to be able to contact you. So, what is the next stage for someone who says, yeah, you know what, I really need to improve this part of my property venture. So what do people do first?
So, they should visit our website as I mentioned. So, our website is really the gateway to us. You can connect with us on social media. So we are active across the various social media platforms, LinkedIn, Facebook, Instagram, and we continue to share our knowledge on those platforms and there is a link to connect with us to speak to us through our website as well, if people want to take that next step. So yeah, plenty of ways to consume information at a pace that suits you.
Fantastic. Thank you very much for joining me and like, I’d just like to say as well that you can go to a bank. You can go to a private Equity Firm, you could do number, a number of things to try and get funding for a property deal whether that’s a little property deal or a big property deal or massive development. You can you can find places that will fund you on those developments. However, if you want to have a proper investor who’s going to invest in you and not make you find all of these hundreds of different fees and put down 35% deposits on the purchase and then charge you the Earth for the development of the project and so on and so on and lots of different exit clauses and safety clauses. If you’re going to have an investor that’s going to invest in you, then I just want to Echo what Karen just said, because that’s really resonated with me and that you’ve got to make it easy for them.
So I just want to say thank you once again for sharing your knowledge with us Antoine and Karen. Thank you very much. Is there anything you’d like to finish on any little quotes or sayings.
Just that I just add to what you just said because I think it’s it’s you know it’s an entirely true and you know one thing you one of the benefits of working with private investors is that you’ve got a direct relationship with the people who are actually going to fund the deal.
If you’re looking at a private Equity Firm or if you’re looking at bridging finance or bank, they are, you know, merely intermediaries and you don’t have a direct relationship to the decision maker to the person who’s actually going to say you know yes or no, I’m interested in funding that deal and I think that’s one of the one of the benefits of going direct to private investors. You can build a relationship and you know you can have the investor for a very long period of time if you do things well, if they’re happy, if you communicate well, it’s a long-term investment in a win-win relationship that you can. that you can really commit to.
And on that note I like to add that you should always. You should start looking for investors today. Don’t wait until you have found the magical 10 blocks of flats before you start looking for money because you know, we hate to break it to you but that’s often too late to start looking for money because we get that people find a deal. They really need an investor and they go like, how can you help me create investor pack?
As we mentioned earlier on in the podcast, it is important to build that relationship. So don’t wait until you have found a deal to start looking for investors. Start today.
Great great great advice and hey this sometimes I think this stuff goes over people’s heads, especially if you’re an investor landlord who just wants to grow your portfolio, you maybe think, well, I don’t need to get involved in that. I just just buying some buy to lets.
Well if you want to do that quicker and you want to scale it up, then absolutely you should look at different ways to funding than just the standard buy to let mortgage lenders. They may well be better options for you to grow.
So I’ll finish their by saying thank you once again for joining me. I’m sure this isn’t the last one. My name is Tom Soane and I’ve been very very privileged to be joined by Antoine and Karen do get in contact with them. Definitely go and download the free stuff that’s on their website, even if you only download their investor pack template, it’s a really good insight and a guide into what sort of things investors would look for if they’re going to invest in your property deals and that can be massive developments where you’re building 50 Properties or it can be one buy to let property that you’re being able to buy for below market value.
And remember that within all of this think about this from the investors side because actually, you’ve got to make it easy for them because to them this is an investment and they want to make profit without putting in tons of effort in the same way that you’re a property investor and your property if you remember my saying is nothing more than a vehicle which is designed to make profit without you.
So my name is Tom Soane, this is Antoine and Karen and this is the Anonymous Landlord.