Financing is the biggest challenge for most investors. I previously wrote How to Generate Private Money listing the 6 steps below. Here I will break down the 1st step Pitch your opportunity to everyone.
Step 1: Pitch your opportunity to everyone
Goal: Get face to face meetings, get referrals, lots of them!!
Solution: Use an effective elevator speech, get prospects salivating to learn more and get the meeting. Always ask for referrals.
Solution 2: Give out free quality information. Giving out free information via articles, seminars, conference calls, webinars, etc is a great idea as it will build credibility, people will come to you and it makes it much easier to build trust. Set up the meeting and ask for referrals.
Elevator Speech: An elevator speech is simply a 15-30 second speech that tells what you do, what is in it for an investor and gets them salivating to learn more or refer others who might be interested. You want them to ask questions, but do not under any circumstance answer them.
Example: I am Real Estate Investor. We buy, lease and sell investment real estate and provide investment opportunities to the right people. Typically these people have some knowledge or comfort in real estate but hate the thought of owning and dealing with the hassles of managing property. We provide investment solutions to individuals who want to make good returns backed by real estate without the hassles. Does that all make sense to you? (Based on their response, ask for the meeting and referrals)
How to Ask for the meeting and referrals: If they seem disinterested, simply say “I’m not sure if this is for you, but who do you know that would be interested?” If they are interested, they will say me, otherwise they may give you some referrals. If they ask questions, do not answer them under any circumstance. Tell them “That is a great question, but there is much more to it. Why don’t we sit down and I will go through it with you?” If they hesitate, immediately say, “No pressure, it is not for everyone. Who do you know that would be interested?” If they are blown away and salivating, set up the meeting and ask them who they know that would be interested. Do not push or act desperate. Act confident, act like you do not need them to invest, act like your investment opportunities are the best thing since sliced bread. It never hurts to have a fun success story about the guy who passed on a deal but another investor jumped all over it and is now laughing all the way to the bank.
6 Steps to Generating Private Money:
1. Pitch your opportunity to everyone – You are not asking for money, you are inviting people to make a great return on their money. The purpose of this step is to get them excited and begging for more information. Usually just an elevator speech and a success story if needed. Do not answer questions, set up a face to face meeting and present your program. Opportunity awaits the savvy investor.
2. Face to Face Presentation – Set up a face to face meeting with all decision makers. At this meeting you can build the most important thing when it comes to generating private money, build TRUST. You can also present using a net meeting if face to face is not possible.
3. Find a great deal, illustrate a win-win, the deal and the risk – Educate interested parties on what is in it for them, the numbers on the deal and how the deal can withstand the worst case scenarios.
4. Play the numbers, all you need is one YES – Do not give up after 3 people, you may need to present it to 300 people before you get the desired results. It is never a bad thing to have people fighting to give you their money.
5. Handle objections, ask for referrals – Learn how to handle objections, anticipate the most common ones. And always ask for referrals. If you are leaving a presentation without a YES you should have 3 referrals.
6. Treat them like your grandmother – Be great to them, not good, great. Also be completely honest and set expectations so you can shatter them.