Table of Contents
Podcast Transcription
Dave Dubeau [00:00:08] Hey, everyone, this is Dave Dubeau with another episode of the Property Prophets Real Estate podcast today, zooming in from a warm, sunny, I’m assuming Arizona the God Mr. Ruben Greth on the call with us, How are you doing today? Ruin?
Ruben Greth [00:00:23] I’m doing fantastic. How about yourself, right?
Dave Dubeau [00:00:25] I am doing very, very well. So Ruben is very accomplished. Real estate entrepreneurism multifamily syndicator where to find out exactly what the heck syndication is all about. And the way I first met Rubin was because he hosts an amazing podcast, which you can see by that sharp looking logo, right? Kind of there the capital raiser show. So I had the pleasure of being interviewed by Ruben a little while ago, and he’s such a smart guy definitely wanted to get him on my show and have him share some of the experience and learning around raising capital. So, Ruben? It’s a real pleasure to have you here today.
Ruben Greth [00:01:01] It was a lot of fun having you on my show. Thank you for having me. Can’t wait to dove into a variety of topics.
Dave Dubeau [00:01:07] Perfect, perfect. So you’ve got this podcast. I love the title. Says it all capital raiser. Show it! That’s pretty much as laser focused as it can get there. But why don’t you tell us a little bit about your journey when it comes to real estate raising money and what you’re actively doing in that space right now?
Ruben Greth [00:01:27] OK, so starts with my dad planting a seed that real estate investing was the way that he made his money. So he was a doctor, brigadier corporal in the military and a politician. But he told me before he passed, he passed when I was very young, so I was seven years old. Oh wow. And I remember thinking. I want to be exactly like this guy like so he used to have these big parties and he plays mariachi music and, you know, at some point in life I studied chemistry, I had big parties and I didn’t have the real estate yet, and I was graduating from college trying to figure out, how do I get into this? I don’t think I want to be a doctor like him, but he told me, you know, be a real estate investor. So I joined a group, an investment group that taught like 30 or 40 different health strategies. But one of their classes was multifamily, and I was very intrigued by the scalability, by the generational wealth, by the amount of money, by the additional mathematics and formulas that people were using to create wealth in that sector of real estate. And I had a meetup at the time and there was this dude from San Diego that showed up one day and he was buying a bunch of for blacks, and I convinced him to let me follow him around to his projects and show me exactly what he was doing. So I would film him. I’d put it on YouTube. He would explain how we would find the property, how he would finance, what we were doing to raise the capital and how we were going to rehab it and occupy it and put it back on the market and do it in a very aggressive time scale within 15 days. Right after the crash. So we were doing it right at the best time that there ever was for investing in real estate where you could buy properties, multifamily properties for about $20000 a unit, which sounds crazy today. So from this process of me starting what I didn’t realize was the thought leadership program or platform, I was basically interviewing him on my videos, putting them on YouTube, and then people would fly into town. We would have lunch with them. It was a very slow courting process. We never offered anybody any money or any financial returns, but we said, Hey, if you’re interested in multifamily and Phenix, come, come check us out. Come talk to us. We’ll teach you how to do it or we’ll let you participate in potentially, you know, doing business with us. So we would take them to the properties for whatever reason was magical. The people they could like touch it right so they could feel the concrete or whatever. We really loved brick buildings. And I raised six hundred thousand dollars. For him and for us. And he had raised much more than that, but that was my introduction to raising capital. I knew a couple of things because one of the things I didn’t mention was I was a lender, so we had to learn in the United States. These things called truth and lending laws and Regulation Z, a couple other things that prevented lenders from advertising rates that they would sell to their customers. So I kind of had that at the back of my mind. Never talk about rates, never talk about returns, never talk about anything, just really tell people what you’re doing and then invite them to come talk to you. And he and I eventually split up and I left real estate for a number of years, went down to Mexico and then came home. And all I had known was for Plex’s. So I’m thinking to myself, Well, I’m going to buy a four plex pay down the amount that I owe on it to build the equity and then buy another one in two years. And then I’ll double that portfolio every two to two or so years until I get to 32 for Plex’s for a total of 128 units. If I get there, I’m pretty set for the rest of my life. I’ll cash flow forever. That was the idea, but I didn’t get any traction. I couldn’t get any footing. I couldn’t buy my first one. And it was driving me crazy. But I did present this plan to somebody and they challenged me. They’re like one hundred and twenty eight units. Why don’t you just go buy those right now? And I was like, What? Like, I don’t understand. They’re just, like, still syndicated. I’m like, What? What does that even mean? I’ve never heard of the word syndication. What had explained that to me or what he explained to me that apartment investors are not these really rich people. They’re essentially. Average Joes that team up with other partners and buy apartment complexes, the majority of syndications, whether we’re talking multifamily or hotels or casinos or baseball teams or whatever business, high rise downtown offices, they’re all syndicated by pretty much average people that there’s an operator. And then they gather a pool of investors and their team together and then purchase these large assets as a team, not individually. Sure. So I got very fascinated with it and interviewed a bunch of gurus. I was getting ready to pay $30000 to somebody to teach me how to learn to syndicate. And I asked my broker at the time I had hung my license with the same person that sold me. All the multifamily is back during the crash. And I’m like, Who do you know that syndicates? I’m really curious about it. I want to learn about it. Who do I need to have on my team? He’s like, Well, I saw this $5 million property to Bakersfield last year. I’m like, Can you put me? I’ve heard of those guys put me into a meeting with them. I’d like to ask them, Who do I need on my team? I get them into a meeting, and almost immediately they turned it around on me. And they’re just like, Well, syndication, why do you care about syndication? Why do you want to do this and why? Well, I used to raise capital back in the day. I see multifamily as a great avenue for creating generational wealth, for providing properties for my bloodline and for helping a lot of people make money. And they’re like, Oh, that’s very interesting. And I told them I used to raise capital on social media back in the day and they’re like, Wait, wait, wait. Hold on. Go back. You know how to raise capital on social media? I’m like, Well, I don’t know. I used to do it back in the day. They’re like, Can you do that for me?
Ruben Greth [00:08:00] You know, can you do that for us? I’m like, I can try. So that was the inception they brought me on board, and I started the capital raiser show because I figured, Hey, if these guys are bringing me on to raise capital, then I might as well start a show on it so that I could learn how to do it as best as I can and interview these people. And I know that that’s going to get us exposure and brand awareness across the country, assuming that I do it right. But I just didn’t know that it would grow into this crazy podcast, and I would learn so much about raising capital in so many different ways. So it’s been really, how long have you, how long you’ve been running the show for
Ruben Greth [00:08:37] about 19 months,
Dave Dubeau [00:08:38] 19 months at the time that we’re recording or so? Yeah. All right. Well, fantastic. That’s an interesting, interesting journey just out of personal curiosity. What are you up to in Mexico for the? I lived for a while in Mexico but was also always curious. Yeah. So what I didn’t mention, but like after I broke up with my real estate partner, I ended up crawling back to corporate America. And I was behind a desk for about a year before. Eventually, I couldn’t handle it anymore. So I quit one day and I had my car packed and I was listening to my gut intuition. And one day is just like, Go. So I took half and my idea was to cap down with my dogs on the beaches all along the Pacific coast until I got to about Acapulco, and at which point I would turn east and go towards the Caribbean. And I did. I stopped. I would basically camp with my dogs. Every two hours we’d stop at a beach, stay there for a day, and eventually I got to Acapulco and I was drinking a beer on the beach. Eventually, I got my beer was done, so I went back to the Circle K over there. They’re called walks us and I grab a couple of beers, was sitting on the sidewalk with my dogs, just kicking back in. This really beautiful girl comes out and she’s very finely dressed and I’m like, What are you doing? You were on the beach. Why are you dressed so nice? She’s like, Oh, I’m coming out of a network marketing meeting. Turns out she became my wife over time. So I was talking to her about coaching. I’m like George in network marketing. That probably means you have to have a coach. Do you have a coach? She’s like, Yeah, I have a coach. I’m like, Well, that’s just amazing. And I elevated her and I put her on a pedestal for challenging herself. And that’s how I won. Her heart was by telling her that I was really proud of her, even though I didn’t know her and the rest was history. Eventually, we made it back to the United States. I guess I should say I stopped in Playa del Carmen for about 10 months. Amazing part of the world there. What I refer to as a Mexican Caribbean or the Riviera Maya is another term for it. They have all these freshwater said not this, which are like these pools of caves where you go swimming in freshwater and you can scuba dove even and find you get lost in these caves. Or then you can get on the beach where all the corona commercials are filmed, and there’s all these theme parks everywhere. It’s just an amazing part of the world. Highly recommended.
Dave Dubeau [00:11:02] Well, sounds like you had a nice little. A very nice hiatus there. Yes. 100 percent. All right. Well, let’s get back to let’s get. Raising capital stuff, Reuben, so tell us about your journey. And it sounds like, you know, you’ve seen. People do it right, and you’ve seen people do it wrong, what are some of the biggest, dumbest mistakes you see people making when they when they first get started with raising capital and then kind of tied in there with that is what’s the difference between the way you started raising capital and syndication?
Ruben Greth [00:11:40] Those are both really good questions you can screw up. You can screw it up, both in the old way that I used to raise capital and the new way. And part of that is to violate securities law. Right. So you’re telling people, Hey, you know, come participate in my deal that can send you to jail very easily unless you have an exemption that allows for that, which is an advertising exemption referred to as Regulation D five or six C. But for the most part, these crowdfunding rules didn’t exist prior to just a few years back. I think they came up with them in 2012 2013. But that’s a big part of it. Some of the other mistakes are that. You know, like I think the biggest one, the most obvious one is people try to they think that if they have the right deal, the money will come. And I think for small deals like under 100000 or maybe under two hundred thousand, you can get away with that. But once you start moving into the world of bigger deals or even syndicated deals, that no longer is the case because people need to know they can trust you, they need to understand why you’re interested in multifamily. They have to have a connection with you. They have to understand what it feels like to be in a deal with you. And then once those parts have been established, then you can present them with the deal. If you try to present them with a deal without having those, you know, the connections that know, like and trust, the understanding of multifamily, the understanding of what it’s like to invest with you. You try and get people through all of those steps after you have the deal. It’s very challenging. An uphill battle. That’s probably the biggest problem. Another problem would be that people are not staying up to date with technology. So a lot of these high level multifamily people, they have investor management portals where people can access information, they have automation, so people receive emails and updates and cost of communication. And then there’s these old school people that are just like, not interested or for whatever reason, they have resistance to becoming, you know, to adapting to technology. And I think they’re falling behind, particularly on the social media side. I think a lot of people, they don’t have that social media presence and that can be a problem because now people, their own investors are going with people that are on social media and they’re no longer able to raise capital from the same pool of investors that they’ve raised capital from before. So those are some of the big mistakes, I think.
Dave Dubeau [00:14:20] Well, that brings up another question for me here, Rubin, and that is again slightly different. The people I tend to work with are what I call mom and pop investors are just getting started with raising capital, and we always recommend talk with, you know, focus on the people who already have that preexisting relationship with that start. But once you kind of tap that out and you’re and you’re looking to expand your network of prospective investors, in your opinion, in your experience and after the gazillion people, you better argued about this what is the best way to use social media for raising capital without going to jail?
Ruben Greth [00:15:01] And so planting seeds and making friends? Honestly, that’s all it is, really. I mean, there’s stuff that we talk about on my show about keeping investor worms in between deal deals and like all these strategies and automations and create an emotional website. And at the end of the day, really, there’s plenty of people that raise capital without any social media presence, and they do this by just connecting with the right people. So my biggest advice and what I define capital raising is, I mean, besides the nurturing of the investors and keeping them fresh, I think really what capital raising boils down to is the same thing that creates success in any business, which is just meeting people. Right. So if nobody knows about your business, you can’t help them. So that’s the biggest part of the know like and trust triangle. So people will, you know, if you if you survey people, you know, what’s more important is that like is the trust, is it? No, we will be like, Well, I’ll never invest with anybody if I don’t trust them and other people feel like I have to like them or else I’ll never invest. But the bottom line is you can never like or trust anybody if you don’t know them. So then I think a lot of people get stuck on how do I convert two out of 10 people into my investment versus one out of 10? And really, what they should be asking is, how do I get in front of 10000 people? So that’s the ideas like network, like crazy to think
Dave Dubeau [00:16:29] that’s right, because it’s it goes in that order, it’s first of all, no. Then like then trust like there’s no you can’t really skip any of those. You can skip ahead to anything they’ve got to know. Yeah. Then they got to like, Yeah, then they got to. You got to work on that trust. So, yeah, the more people you get to know you, then you can move them along that process. So personal curiosity, Ruben, for you guys with your company. How does your process work, how does it work with Sen? How does the whole platform of your capital show kind of help all of that go along? How does that work for you guys?
Ruben Greth [00:17:11] Yeah, so none of that stuff existed when I showed up at Vegas in 19 months ago. So they didn’t have a platform. They didn’t have communication. They had transitioned from wholesaling houses to wholesaling multifamily to syndicating multifamily, and they had brought some of their investors. And like you said, they tapped out their friends and family network and they’re like, OK, so we’ll just do this five or six C. We’re going to be allowed to advertise and then that’ll help. But it didn’t because you weren’t going through the steps
Dave Dubeau [00:17:42] for the trust, right? Nobody knows them. Nobody likes to be out there just going, Hey, buy into our deal as if that’s going to work.
Ruben Greth [00:17:49] If the deal is good enough, the money will come with the mindset of the culture when I showed up. And, you know, so I didn’t know exactly how to change the culture or to explain the process. I don’t think that I even knew what the processes were until I started interviewing all these syndicators and they were like, Hey, it’s a four step process. Get people to know they can trust. Step number two is to explain why multifamily and make sure that you align with them and their goals. Step three is to explain what it feels like to invest in your deal, and then step four is to present the deal. And when I got here, it was like Step four, boom. Let’s present the deal and the money will come. And then they’re like, Hey, you know, we hired you to raise the capital, where’s the capital? You know, like, if it doesn’t work like this, I can’t raise from people today if I didn’t talk to him yesterday. So there’s been a shift in culture and evolution or change. And since I’ve come on board, we’ve also implemented a lot of communication strategies, a lot of automations, email automations. And let’s see. So we got this investor management portal, which we’ve never used. It’s called Syndication Pro. It’s been fantastic. And then like because of the platform, the other part is like the K, right? The no. No. How do people know you? Well, you have to do a massive amount of networking and preferably I think the path of least resistance is to start a podcast much like yourself. So I commend you for doing that because you start producing content and then people start to see you and then they can start to know you. And that’s the first part of the klt triangle. The investor. Try it. Yeah.
Dave Dubeau [00:19:35] Beautiful. I love it, my friend. I love it. Time flies when you’re having fun.
Ruben Greth [00:19:40] I talk about this and just it goes so fast.
Dave Dubeau [00:19:45] So I got I got a short podcast. There’s a there’s a method to my madness that means we get to circle back and revisit this in a few months and have another nice, wonderful conversation. So you guys, obviously, if you are able to find out more about Reuben and what he’s up to check out his podcast, It’s amazing capital raiser show is right there behind him. Capital raiser show, dot com. If people want to find out, connect with you some other way. Is there anything else you’d like to suggest they do, Ruben?
Ruben Greth [00:20:14] So LinkedIn. And here’s a tip for all the listeners. Put your contact information in your LinkedIn profile, your phone number, your county link. Find me on LinkedIn, but you can find me on all social media. Is my handle at on Instagram is at capital raiser? You can find me on Facebook. You can find me on my website, bakers, income or capital or show rt.com or just whatever your favorite podcast platform is. You know, Apple Podcasts or whatever you can find me on there. I’m on Pandora now, too, so
Dave Dubeau [00:20:46] all over the place. Alison Rubin has spent a lot of fun. Thank you very, very much, my friend. I appreciate you spending some time here with us today and giving us some good tips and insights about raising capital. Thank you so much.
Ruben Greth [00:20:58] Yeah, you’re awesome, Dave. Thanks for having me on.
Dave Dubeau [00:21:00] My pleasure, Andre. Take care and we’ll talk to you on the next episode. Peace. Well, hey there. Thanks for tuning into the Property Profits podcast if you like this episode. That’s great. Please go ahead and subscribe on iTunes. Give us a good review. That’d be awesome. I appreciate that. And if you’re looking to attract investors and raise capital for your deals, that may invite you to get a complimentary copy of my newest book Right Back There. There it is the money partner formula. You’ve got a PDF version, an investor attraction book dot com again investor attraction, book dot com. Take care.