One of the big motivators for becoming a real estate investor is to get out of the rat race. Real estate investing can be an 80 hour a week job, or it can provide you with financial freedom and a lifestyle where you get to choose how, when, where, why. The key is to become an entrepreneur. Many think of an entrepreneur as just a business owner, but an entrepreneur is much more.
An entrepreneur can be sipping on Mai Tais in a far off land while his/her business or better yet businesses are running themselves and increasing net worth and cash flow. Here are some tips to become a passive investor and true entrepreneur.
- Create a strategy and business plan – Every hour you spend on creating a strategy and business plan will save you 10 hours of wasted time trying to wing it.
- Separate yourself from the daily processes – This is the tough one. Many cannot grasp the idea of delegating anything. They are do-it-yourselfers and trust no one. Change that and go with the strategy “If I don’t have to do it, then delegate” and separate yourself from as many daily processes as you can. Your business must run on it’s own. That means hire property managers, project managers, assistants, contractors, attorneys, office managers, sales/agents, CEO, etc.
- Create systems and build teams – Document systems, improve systems and build teams to handle all the processes in these systems. Then duplicate.
- Spend your time on continuous improvement, strategy, growth and high level decisions – These are the tasks that add value to your business but do not have to be done everyday to keep the business going. Duplicate your teams and systems, always improve and be opportunistic and well as fend off threats.
- Lend your money – Financing is one of the biggest challenges for businesses and real estate investors today. Find a trustworthy business with a successful track record and strong business plan and become a passive investor partner. You can be an equity partner, joint venture, private money lender, hard money lender, angel investor, etc.
Have you ever heard that only 4% of seminar and boot camp attendees actually do something? That means 1 in 20 people at your weekend seminar will succeed. Most people will say it is because they do not do anything. While I agree with that, I think the reason they do not do anything is they are intimidated by the time it will take for them to build the business. To overcome this: create a strategy, systems and a team that can separate you from daily processes. Then focus on entrepreneurial activities. Once you achieve this, get some hobbies, volunteer, give back and spend time with your family with all the free time you will have. Happy Investing!