How to Build a Rock Star Team for Multifamily Investing
‘No matter how brilliant your mind or
strategy, if you’re playing a solo game, you’ll always lose out to a team.’
It will address the following topics under the main heading of, how to build a rock star team:-
- What is the biggest mistake that investors make when forming a team?
- Where to gain alignment and diversity
- Who do you need on your multifamily team?
- The Importance of construction team members
- Case study of a multifamily rehab (cash out 6 figures)
What is the Biggest Mistake That Investors Make When Forming an Investing Team?
The first thing that we need to talk about is gaining alignment, in other words, having the same set of values.
With your investing team members, you must ensure that you have the same values, goals, and expectations.
One of those values might be a willingness to deal with delayed gratification.
If you are not on the same page with your shared goals and vision then it is a recipe for disaster.
Here are some questions to discuss with prospective investing team members to ensure that you are on the same page moving forward.
- What do we value as a team? Individually?
- What vision do we have for our team? 5 years?
- What do we want to achieve as a team, short term, and long term?
- What would we do if we knew we could not fail?
- What legacy do we want to leave behind?
The second thing to discuss is gaining diversity, in other words, we need to select team members that are not only aligned in their values but that also have a genuinely different way of seeing the world.
We’ve all been there where you receive a reply to your email and you wonder if the person even read your message. We are all so different and we have different ways of communicating and understanding.
You need people on your team that have different skills, experience, behavior (personality). The personality type is the area where we usually make the mistake, we often choose people with the same or similar personality as ourselves but that is the worst thing you can do.
You don’t want an investing team full of dominant people or a team full of extroverts for example. These types of individuals will bring their abilities which are needed but you also need complementary personality types that are more reserved, thoughtful and analytical.
Likewise, you need some with a sense of urgency and others who are very patient and consistent.
Some team members will be risk-takers and some will be more cautious. You need the risk-takers because if you have a team full of patient people, you may never get any deal off the ground. Of course, you also need team members that are risk-averse.
When you are hiring people you can even ask them to take a personality test so that you know what kind of person you are hiring.
Once you have a diverse team around you then it is important that you learn to adapt to those different personality types and give them the space they need to do their thing in their way.
General Investing Team Members
- Commercial real estate agent
- Marketing team
Finding deals is an essential part of the equation and the above team members are needed. Once a deal is found then a lot more work is required to follow through and make the purchase, the team members listed below are needed.
- Mortgage broker/Banker
- Insurance agent
- Private Money Partners
- Title agent
Once the property is purchased, it needs to be managed.
- Local “feet on the street”
- General Contractor
- Construction Manager
- Property Management Company
Now we transition to…
CORE Investing Team Members
These are the people that you are driving your business with, that you do your brainstorming and goal setting with.
From a multifamily perspective, you need a tenacious person who is aggressive and views the word ‘no’ as a positive step towards getting a ‘yes’. These are the ones out there talking to brokers and who will do whatever it takes to find a multifamily deal.
This is not a quiet, shy and retiring personality t
These are the folks that look at the deal that the hunter finds and underwrites the deal putting it through a thorough screening process to make sure the deal will work in real terms.
We all know that multifamily investing takes money. So you need a person that has or can build relationships with the people who will invest.
After the deal is closed you need someone to manage the value add opportunity. This will allow you at some point to refinance and pay back your investors. This is the person who makes sure that the project happens on budget and on time.
Where Do You Fit In?
You might to some extent fit all these needs but what you want to think about is, what part of this can I handle at a genius level?
The key to building a ‘rock star’ team, not just any team is to figure out what part of this you can do at a very high level. Then surround yourself with others who can do their part also at genius level.
Are you the hunter, the brains, the money or the hammer?