To begin your investing journey, naturally, you need capital. Acquiring that working cash can be quite difficult, so today, we’re talking about raising private equity for self-storage deals. Our guests are experts in the field, Jillian Sidoti and Nancee Tegeder from Crowdfunding Lawyers.
Jillian Sidoti, an attorney, public speaker, and entrepreneur, will be offering insights into the challenging path to finding funds for real estate investments. She’s the author of the Crowdfunding Myth, a book that can help you achieve your fundraising goals within the letter of the law.
Nancee Tegeder, a leading expert on opportunity zone funds, will also help us understand crowdfunding laws. At various seminars, in written articles, or in person, Nancee advises clients on crowdfunding, syndications, commercial real estate transactions, and securities laws, creating the foundation for successful investments.
Crowdfunding for Self-Storage and Real Estate Investing
Before you start looking for investors, you want to create a plan. Better yet, wrap up the entire story and show the potential investors how it can unfold. Naturally, you want to explain distributions in detail, although they can be secondary to the story itself. Note that institutional investors already know the basics, so you can cut to the chase.
When you’re crowdfunding for self-storage, you should always discuss potential returns in advance (they can be up to 7-9% on average) and show investors the great growth potential. Account for your fee as a syndicator and be transparent. You can agree to a 30/70 split, but some people agree on 20/80 or 40/60 depending on the negotiations. For your first deal, Jilian and Nancee advise that you should be more generous with your investors. This will be more appealing and you’ll be more likely to get them on board with your next deal.
Show them the results first. Accredited investors want proof that you know what you’re doing. Nothing proves this better than previous results. Offer your expertise and experience with previous self-storage deals and work on building credibility. You have what they don’t – experience – and that’s why they will invest with you.
To find real estate investors, attend as many online social events as you can. These are a great alternative to in-person events. They can have a much broader reach and attract people from all over the world. A crowdfunding platform can be very useful but business networks are priceless. Online live events, seminars, educational materials, and marketing funnels are just a few options, among many others, for reaching out and making connections.
People don’t want to put a lot of time and effort into finding deals to invest in. They don’t want to be involved with the development and project management and all of the other smaller details it entails. Your goal is to make things simple and easy, so investors come to you.
Investing in Self-Storage Facilities
In the current environment, folks are coming out of the stock market looking for a steady asset class. Show them the resistance of self-storage investment projects. If you invest in a self-storage facility in a prime location, your investment is much more secure when compared to other assets.
Market fluctuations and economic downturns do not impact self-storage units quite so much, so crowdfunding for self-storage and finding financing shouldn’t have to be difficult. We don’t celebrate recessions but we know how to seize these opportunities when they come.
For more advice on how to ensure your self-storage business is a success, check out our FREE Blueprint that will provide you with all the information you need!