How to Invest Passively in Apartments, Self Storage, and Mobile Home Parks with David Thompson

I’m Neil and I’m Brittany.

We’re a family on a journey towards financial and location independence. Each week we interview successful real estate entrepreneurs about their chosen investment strategy, and rated based on how much money it took to get started, how long it took to educate themselves, how passive it is, and whether or not they could do it from anywhere in the world.

Welcome to the road to family freedom.

On this week’s episode, we’re joined by David Thompson, a multi asset syndicate or from Thompson investing.

If you like our show, the easiest way for you to give back is to leave us a rating and review on iTunes, head on over to road to family freedom, calm slash review for links and instructions on how to do that we would be so grateful. All right, enough out of us. Let’s hit the road to family freedom.

David Thompson, welcome to the road to family freedom.

Thanks, Neil. Nice to have me appreciate it.

It’s great to always talk to you. So what are you up to these days, David?

Well, we’re in a year three of Thompson investing and we started this process it doesn’t I can’t believe it’s been three years already but it’s it’s gone by fast and that we’ve been very busy this year. We’re finishing up our 13th deal. We’re working our 13th deal will hopefully have done next month take a break for the holidays but the business keeps evolving find new things to reach out to investors on and waste educate them and it’s it’s fun I’m enjoying it will be talking about some of that more particulars as against the interview, but had been a blessed year of and everything’s been going well. Markets been favorable. Bring up some great partners I’m working with and and really enjoying growing the investor base and educating them on what’s available.

Great, awesome. Well, listen, tell us a story about how you got into real estate,

So we’re hoping that some of our listeners are going to be beginners and for those of us I’m still learning myself, will you explain a little bit more about what syndication is

Awesome. So as far as I know, with a lot of these, you guys are coming in, and here you’re buying properties that need a little bit of either work, or they can they can use some upgrading, and then that’s where the extra money comes in, where you make more money, because you’re upgrading them and then rents are going up or that kind of thing.

Yeah, that’s a very good way of describing it. And, you know, I’ve always tried to find what’s the great what’s the right way to explain it to people. And I think for people really new to, you know, you see these flipping house shows, you know, and they look really kind of cool, and a lot of people want to try it themselves. And they realize with a lot of education, you can you can not do so well. TVs make it look really easy, I make videos on the weekends. But but the same kind of concept we call these are value add value added means we’re not just buying an asset to hold on to it, you know, we’re not really we want to create value for our investors to do that we want to find asset, that’s part of the good value in a good area, that if we were able to do a makeover, so it’s flipping an apartment, you know, it may take a couple years to do that. And why would it take so long, a typical apartment, we might buy us 200 units, okay, we buy proven assets 95% occupied, so that means it was 95% occupied 200 years, you’ve got 10 only 10, renovate, fix up the kitchens, bathrooms, you know, maybe to redo the floors. And you may spend anywhere from you know, $4,000 and 70 $500 to do that per unit, but we don’t renovate when people are living there typically, right? So we have to wait for the leases to expire. So you can just envision a pancake, you know, we got maybe 10 we renovate when we first purchase it, they might planar, you know, 10, or eight or 10 residents or leases are expiring will get most of those folks to go, Hey, I’ll spend a little bit more money, you know, $75 a month and maybe you’re getting them 250 over two years, but they can see the value proposition. They like the area, you’re already in schools, their kids are in the schools or perhaps or jobs are close by they know the area friends in the area, they really don’t want to move, they don’t want to move. And if you’re providing a good value for them, the community when they when the owners and investors if it’s done right, so typically it’s done right. So yeah, it’s just have a makeover vision that but it’s for a larger asset. So it takes longer may take two years to do that, at the end of two years, we decide is this a good time to sell the asset? Or do you want to hang on to it few more years of the markets down? We won’t sell and we’ll just hang on and keep making the distributions from a cash flow from the operations, right?

Well, you just brought up a point there that I think it’s important to hit on is that with a house flip, you’re typically buying it and your goal is to resell it, and let’s say six months, and a lot of these house flippers don’t have any other exit plan Other than that, and they haven’t bought it in a position where it’s going to be able to cash flow, if they end up having to hold on to it for a while. Whereas what I believe you’re describing you guys are buying it, it’s hard to cash flowing. And in the worst case scenario, you know, let’s say the market turns and you’re not able, it’s not wise to do those renovations, then you can just sit and cash flow correct.

Alright, so here on the road to family freedom podcast, we’re really big believers in the beginning with the end in mind. I mean, you’re you’re about to be like not have any kids at home in the next couple of years. What sort of is your destination? Where’s real estate team you because you’re already pretty successful? So what’s what’s next?

Well, you know, I’m stretch talking about that, honestly. First of all, I didn’t realize when I started this would be where it is it wasn’t. I think it’s your your vision and your explanation of being streaming into my is great. But I think a lot of people don’t really know what that is yet, because you don’t know what you’re capable of. Right? I certainly didn’t know. First of all, when I got to college, I had a financial planning degree, and I had to go, the only people that were hiring me was the early 90s. And we had a recession. And when people wanted to hire me work insurance companies. And they wanted me to sell whole life insurance and disability insurance. There’s nothing wrong with those products, but it’s not very sexy. And I didn’t do very well at it. And I didn’t really like it. I mean, if you don’t like somebody, you’re not gonna struggle with it. I preferred more equity type of discussions, but they said, Well, that’s not what we do. And then when we’re hiring the brokers from that point, so yeah, I end up going back to school, but I had this mental block the whole time, over 20 years, I didn’t know sales and marketing person, okay. And so when I got into syndication, I realized I loved real estate, I love the power of syndication, I really got that other people’s money helping, you know, driving value, you know, I didn’t have all this money to buy my own apartment, but I can participate. And I can be on a gentle partnership team I can earn from that. But I could also really start putting some things away from my long term future. So that started me in the business but I really had if someone would if the if my operator partner at the time said, Hey, this is kind of sales and marketing Okay, with no, I’m not okay with that. I’m gonna go find something else to do. It was not that approach. It was like, Hey, you know, you like what you’re doing here. You know, just you like it. So if you like it, go educate investors and what you know, you’re you’re much more knowledgeable the average person on this, so just share that. I always envisioned my business as like, I’m investing in all these deals. I know what underwriting is, I know what a conservative written model looks like, I know a good market when I see it. I know a lot of things. And when I started talking to people, I was amazed at how much they didn’t know about that stuff. And then I was like, wow, this is cool. It’s not like you’re selling a house. It’s not selling anyway, by the way, but let’s just put it that kind of framework or car everybody’s done it. Everybody’s bought a house or by most people, everybody’s bought a car, they’re kind of their kind of if they see me and I’m I’m talking to them about a car, a house, like I can’t kind of hurdle that stuff before it was, you know, so they already have a preconceived notion about you and what you can be. But with me, it was like, they’re like, wow, what is this, explain it to me. And the better I got explaining it, I realized I had kind of a talented niche in that just, I liked it. And all sudden, I was doing a lot of it. And I didn’t have an end in mind. At the time, I was like, I’m just love being out of the corporate world. I have my own schedule, my own time, I can work on the products I want to work on, I believe in these projects, all that was playing into, I got this that mental block away from me now. And today, it’s more about thought leadership, which is I block books I’ve got, I’m educating people in a way that makes it simple for them to understand. And then when they’re ready, we’ll maybe have an opportunity that fits them. And I just explained the investment. They like to answer their questions. And I show them mechanics and how to get into it. It’s that simple. I don’t cold call anybody. It’s to my thought leadership people program people come to me I have a website, I don’t have to go out and really, you know, I’m not doing cold climate do anything that I wouldn’t want to ever do anyway, I’m just I have relationships, I have a return investors, I have referrals. And those things that just kind of build like a snowball over time I ever have no, I was having a 10% new investors every deal. Now I may be bringing in 50 to 100 investors ideal. It’s just a fun business. And and so that gets back to the name question, what do you think this is going to go? Why keep adding things to the business that I see. And I don’t have this clear vision of where x is going to go and it’s struggling is this you know, you want to encourage creative, extraordinary life. Everybody wants to do that extraordinary life, to me is probably not working the hours I work. I love it right now. But I I did 13 deals this year, I was always doing something, and I have to get used to not doing something and enjoying that time. And so you know, with me, it’s that struggle of, you know, how many deals do I want to do? And should I just do smaller, fewer deals, but bigger deals and be you know, what am I investors want from me? You know, I always think about what is my investor base is 300 plus investor base, what are they looking for? Right? They want me to be true honest integrity, of course, but they want me doing things that I believed in, and so and so. So I want to make sure that I explained to them all this stuff about how wonderful passive investing is, and we could do for your lifestyle. But if I’m not living that abundant, no, it’s okay. If you love it, you work that many hours, it’s fine. But you need to find time to what is an extraordinary life for you. And I’m right now, process. But what is that for me? You know, what does that look like for me? And how much time do I want to put into the business? How big is this, they want to go? I don’t want to be content. And that’s the struggle I have, because it’s human nature to want to keep growing, you know, they’ll grow or die. And so you do want to keep growing, I gotta figure out is growing and getting back more is growing. I have a team of people helping them grow their business, you know, is it doing conferences and helping industries get more educated? I don’t know, that could be a lot of different directions, hundred million things. But I have to fit that into the confinements of what I want for myself and my family and their lifestyle and all that. So yeah, beginning again, is my as what I’m working on, it’s going to be more of a balanced approach this year was a really, it got to a point where I felt that I needed to really step back and think a little bit about that a little bit more for myself.

So, how did you go about getting yourself educated? When you were starting out when you had knocked down this road? When you decided, you know, what real estate investing is? Somewhere I want to go How about now? How do I get educated doing that?

Yeah, I mean, obviously, you know, we read the books that you know, syndication, I wouldn’t choose it, I would choose a niche. I’m in 3d is right now but I started out in apartments, that seems to be lucky can resonate with an apartment, we all live in one, right? a dorm, student housing, whatever, not everybody rented a stories to buy a unit or not everybody lives in a manufacturing home park. Right. But, you know, they’re great investment opportunity to understand them. But I would just start with it. Start with an area that you think you can resonate with, or anything you can about there’s lots of books, bigger pockets. I mean, it’s good, that was a good, there’s a social networks focused on real estate. And, you know, start getting in there and being exposed to experts are in those forums, as well as novices, but just started getting, seeing how people respond to these things, find people who already are pretty good out there. I got a lot of my thought leadership there. I mean, I was more of a apprenticeship program, right? I didn’t like read for two years and start I was like a kind of read about it a little bit. And I started I just jumped in and starting to work on with a sponsor an operator and syndicators. So I got to learn a lot hands on, you know, doing due diligence, going to the properties, walking the walk into properties, understand the business plan, what’s going on with the competition around us, why is this business going to work? And, you know, then I would go share those experiences in some of these forums. And there’s more experienced people in there at the time, but over time, the more you answer questions you’re not, it’s like, Melissa, the teacher learns more than the student. That’s what that’s what it is. I’ve been in a day I was I was giving up a lot of information that I was sharing. They had a syndication works. And then now about, I’m walking with five different operators. I can learn a lot of different models, but you know, I was just sharing a lot of information. That’s the best thing is to read a lot. The second step is get involved. I mean, you go to multifamily, multifamily meetup groups, you can go to conferences, a lot of conferences on syndication and get yourself exposed here yourself, like one year is go out there, and you’re still exposed to a lot of different things. And then say, hey, something resonate with me, yes, kind of makes sense. And then get around people who are doing it. At this The day was getting around experts in the niche that you’d like and see if he can do something for him for no charge. Even better. Yeah,

well, and so now you sort of brings into the next point, which is money, you know, everyone talks Well, in real estate, you got to have a lot of money to get started. And what how did you go about financing your first deals? And I know it’s a little bit different, you know, because you’re in syndication? It’s a really different deal. But yeah, but you know, somebody who’s sitting there going walk on, how do I get started in syndication? How much money am I going to need to get started in syndication? Can you sort of talk to that?

So I want to talk about how much time you spend on this. But I also want to do like a two part question. So because I know you’re a general part, you’re part of the general partnership, it’s your investing company. So I’d love to know how much time you’re spending on that. And I’d also like to know how much time people invest if they’re just an investor with you, because I think that’s just as viable for people who’d be listening. And they might say, Well, I don’t want to, you know, be a part of a syndication and a general partnership manager, but maybe I want to invest in this way. What was that timing for?

Yeah, I mean, from my own business, I probably try it, try to take a day off, but there’s always something going on. It seems like people are busy during the week. So you know, I will take you know, some calls on the weekends. And, you know, I try to avoid to me evening calls. But, you know, I want to be accessible to people, I try to limit my time. I even tell people, you know, if it’s even it’s the first time meeting, you know, just kind of 30 minutes. And the reason I do that some more not for the it’s, it’s for me, because I get into it. And I really started enjoying the conversation and I can go an hour. I feel like I’m Tony Robbins, I could just keep talking. And, you know, I just have to recently my wife told me one day you said, manage your time or the better on these calls. So that discipline sounds like quite a bit. But I you know, this is interesting, I get up and and I’m always I’m always thinking about business. It’s a lot of, you know, it’s answering emails, it’s investor questions, from anything from a new deal. I’m working on two administrative things that come up. And now I’ve got some for my wife’s working with me in the business part time, she does the books and she’s got the she had, we have an input Thompson destiny icon, she’s able to take care of a lot of things that you don’t have to take care of anymore. And so the business expanded, keep thinking about ways to make it more efficient. But you know, I could easily think that that are like put hours to it. But I feel like I’m working every day in a bit on something. But I’m loving it right. So don’t like I’m working right? Like you’ve been doing, if you do something you really enjoy, like, remember, as a kid, like, I don’t know, whatever I was doing, it was something fun of us playing on torch with some almost has to call you back in, you know, it’s always dark, you come back in your playing baseball, whatever I was doing is like, I feel like this. Like when I was working in the corporate world, I’d like there was aspects of the job I like, and I love the people, I work with a travel all over the world, and a really amazing job. But I always had to be somewhere, not on my own time, like I had to be in meetings, sometimes I think we’re not really that productive. And sometimes I have to have meetings with people, I really didn’t want to have meetings with your own business. You know, I kind of profit pastors, I just tell them, we’re not really a good fit, you know, and it doesn’t happen a lot. But you know, there’s there’s people that take a lot of my time, and I’m like, it’s not really worth it. I don’t really feel like, you know, this is a passive investment. That’s passive, it means like, you’re really busy, you’re probably good at what you’re doing. Let us handle this over here. And I’ll explain to you, from an investor standpoint, it’s meant to be low time consuming. So on a typical deal, I don’t know how much time you have to evaluate things I typically will get I’ll send out a information people like it, they want to see more information that would be the deck. Maybe it’s a 30 minute call, answer some of their questions, hey there in I want to commit will send them some paperwork to review a ppm a private placement, we’re going to review that. So come to it, sign it, find it. We closed the property maybe a month later, and we’re giving you monthly reporting, typically, it’s an email, monthly report, email, five bullet points, and what I would get the rent that we expected or greater on what we renovate on this makeover. What’s the occupancy level? Hey, here’s some pictures of the work that we’re doing. That goes a long way for investor, they feel like they’re getting a touch from you. But I don’t get a lot of questions on that typically, just nice to know, they just want to know. And then, of course, they’re getting their distributions every month or quarter. I probably get more questions around that. Oh, hey, I did yeah, especially the beginning, when they may not be set up a direct deposit, you know, it’s like they got the checksum. Like going and going ACS going direct deposit, please, I don’t have to deal with this question. But we, of course, will handle that. But we try to we try to give those back to the operator, you know, to handle that, because we have an admin person that can take care of them efficiently. I gave invest as a portal this year, I’m very excited about because I started getting investors who are had four or five deals with us. And like Dave, you know, be nice to kind of track my distributions and managerial investment and maybe some reports. So that was really excited, we just launched that. We have 20 projects in there. And, you know, a few questions on that, because it’s just rolling out people are trying to get comfortable using it and, and that kind of thing. But I’m trying to find ways to make that customer experience very simple. Very much they own it, they can go into a portal where they can get things answered to a faster, you know, input Thompson investing with the answer their questions, questions on the clicker. So as the business grows, you want to get some more support around it. But from an investor standpoint, you could be really low touch, I had one investor call me and he was I really, I just, you know, once when I look and I see the money going in there, that’s great. And I think most investors are like that, as long as the money’s coming in, and they kind of see that they can look at these reports, and it’s like, things are going pretty good. And now we don’t do really an annual investor conference calling like that most of these operators know, it’s just like, work. This is the plan. You know, it’s supposed to be passive and, and, you know, we want to keep you informed. And, you know, all the things are going well, I typically don’t get many questions. And that was kind of an amazing thing for me, I thought we’re gonna get tons of questions.

Good, that’s awesome.

Are the you know, you mentioned the, the investor portal, are there any other systems that you’ve developed to help you sort of automate your business?

Well, I use MailChimp. And I think that’s a service that I like, it’s it really helps with my investor list and automate things, it helps me from my, because we actually co brand the reports, and I’m able to have more of a Thompson vesting touch on those, and I can add some things to those reports. So MailChimp is a really nice service. You know, I think my distribution list is now over 800 people. So, you know, I sent out the I saw a monthly newsletter. It’s great for it’s great for that, you know, and I can actually now it’s interesting is you learn things about technology. Like if I blasted out 100 newsletter, 800 people, a lot of money go to their junk mail, just because the servers are out there are like, okay, that’s too many people, we don’t see that many people that must be john. So MailChimp allows you to do this drip thing. So like 20 investors out of 100, every five minutes, starting at two o’clock in the morning, it takes maybe three over three hours now to get the newsletter out every five minutes, 20 investors every five minutes, my readership is gone up. It’s already pretty good, which is amazing to me, but its readership Scott up, I have a CRM, customer relationship management tool, it’s not too bad with MailChimp, I use that but I could probably look at some more sophisticated when it’s kind of nice to know and investors getting me to have a call with an investor, you can do that need my portal actually is even better. Now I portal, I can put their name in. And I can see all the deals that are invested in how much they’ve invested with us, the portal is helping me get a little bit more mainstream and simplified with that. And I have their address information, things that I want to send them something. So that’s helpful. But yeah, I don’t really use social media. That’s something I’m exploring. I don’t know how it works in my business, you know, we have a relationship, Ambassador ZI could build something like that, but, and they can build on something like that. But you know, getting back to that one question, what’s the end in mind? I had a sales and marketing person, she’s a fabulous friend of ours, she’s a consultant, you know, she’s super expensive to work with us Dr. about, hey, it’s not expensive. But for me, I was like, Wow, it’s a small business, you know, because she’s used to deal with medical companies. And she’ll go in, provide market, but that’s what she was trying to plan to are my business for about an hour after coffee. And she goes, You know, I think we could, we can really drive a lot of traffic to your website. And I’m excited to say how to do that. And she says, but be careful what you ask them like, you know, today I have a really nice, I think it’s a nice volume, I probably through my websites where I get most of new people coming through me, and they see blogs out there from the bigger pockets is on my website, I’ll blast it out. Maybe LinkedIn once in a while. I am a member of the Forbes real estate can well now I just as an invitation only thing by join it recently. I like that I haven’t. So I get some features I can write into into Forbes and I got featured article on there recently. So I just try to expand my reach. And then that drives people to my website, that’s about the efficient thing that I do. And I don’t go, like I said on cold call, I don’t spend a lot of time going to meetings, you know, I don’t like driving around a lot. I don’t, I don’t really attend a lot of conferences, it sounds kind of bad, I probably I wanna I want to make an effort to do more of that. I’ve spoken at a few. But people seem to get to me, and in a good way. And I’m happy with that volume that kind of comes through, it’s manageable. And the business keeps growing. I don’t feel like I need to put it on steroids. I mean, it’s this big thing is big everywhere. But I’m like, you know, you don’t want the wheels to fall off either. I don’t want my health to go in a different direction. Right now. It’s good. But you know, I find days where, you know, we may be did a couple times this year was doing three deals at one time and you teams of people and, and lots of investor questions. And you know, I got the portal coming up, we got questions, I just like, you know, it was to a point where I’m like, Okay, this is not the pace, I want to I want to be doing the pace like this, okay, so there’s gonna be times in your life, your business where you have to go through that I’m like, that’s not sustainable. It’s not healthy, and in the people that you like, and level around you and your investors that I care for, and they want to be able to communicate with high energy of you, they want your time they’ve invested with you. So I don’t want to lose sight of that. But most people return investors and I don’t want to lose sight of I didn’t have the energy to go to that property and do the deals I wanted to do I didn’t have time to really explain the opportunity to them in a way that I think they would have really resonated with them. So yeah, I like your idea and maybe, you know, fewer investors is not a bad thing and the right investors and the right pace.

So where are my your investments? are you investing mostly in Texas, where you’re located or are you doing long distance investing?

Yeah. My big thing is to get invested exposed to a lot of different geographies in three different niches right now that I like the apartments and storage and manufacturing home parks, and, and also so geographies, niches, and then different operators, I think that reduces people’s risk. You know, you don’t want to have one operator, all your investments in Dallas, Texas in one niche, I mean, it make a well, we hope it goes well. But I’ve seen you and with three or four operators I work with, and maybe some different geographies, and some, you know, do some different niches over time. But to your question, Texas is a great economy. I just have my newsletter I put out a couple days ago, and one of the articles I had in there was six things that make texas a dominating economy. And it’s just incredible. And so we have 16, we have 16 of our 20 NW in Texas 12 apartment deals in Dallas, three in San Antonio, one in soon to be Austin. We also have a apartment in Albuquerque. And we have three Self Storage deals in Florida, two in Florida, one in Georgia. And then we have an eight of the manufactured home park operators has got the parks there in Phoenix right now, but they’re expanding nationwide. So they’ll allow our investors to have, you know, in a pool of assets across a lot of different states and economies and and so that’s kind of cool. So my goal is to kind of go that direction. But right now, Texas has been doing so well and still seems to not have any kind of a medium term or long term indication that wouldn’t do well for us. So you know, jobs are kind of coming here in a big way from more expensive states. It’s a business friendly state and low cost of living, relatively speaking, especially from the coastal states. So, you know, the question, companies are continuing to move here employers can be paid, you know, what’s right for the economy here, it saves them some money. And there’s a lot of talented folks here. And there’s a lot of big universities here, they can tap into local talent. And I think I think it’s going to do well for a while.

Yeah. Well, you bring up a good point about diversifying across geography asset class and operator. That’s something I’m not sure whether I learned that from you or somebody else but

so yeah, I mean, I think I learned that from from some interesting tourism I think I met Jeremy roll used to know him used to mention that to me, and he was a very experienced syndicators still is I, I education standpoint, a lot of that is like, that’s, that’s me, I grew up with financial planning mindset, diversification was important. I’ve ever seen investor put 50,010 deals with me than 500,001, I felt I could sleep better at night. You know, and, you know, I think they’re on you’re better, you know, I don’t know what the odds are to do 10 deals NATO and kind of get in and around what we expected, what blows it out. And when does it too, right? Well, you’re going to do pretty good. That’s it, that’s 90%, you know, and then if you put all in one and all of it, and that one, it didn’t, we’re not gonna have a lot of happy conversations with you.

So how often are you visiting your the properties that you guys are investing in,

um, so I’m in Dallas, we have 12 the deals there. So I’m up there quite a bit. We have an asset manager that, you know, reviewing those properties weekly with the property management companies and weekly reports on that. A lot of the operators are work with cluster. So if I’m in one part of Dallas, for instance, there’s three clustering nodes, one in North Fort Worth one in a place called Richardson, which is north east Dallas, and then one now south east and Duncanville area. And so my daughter this weekend, she swing me close to the Duncanville area. So I’m going to drive it was not a formal tour, but just drive by kind of see what’s going on. We can always take investors to these, like within a three day notice just kind of get property fantastic investors there. I’m actually meeting an investor from California this weekend, who wanted to meet me in person and I need to be in Dallas and she wants to meet with, she wants to look at one property she’s investing in with one operator. And then she’s also going into our manufactured home parks deal. So that operators sponsors in Dallas, so we’re going to have lunch with her. So I just try to find ways where I can take advantage of things. But yeah, hobbies, typically touching the properties that areas a couple times a year, but the asset managers are are usually that were, you know, responsible for overseeing the operations, giving us the reports, you know, we’re in touch with them, and monthly, because we have to get the reports out. So

yeah, so you’re really, if you say I wanted to start traveling a little bit more, you would theoretically be able to run this business from anywhere in the world, because you have that team in place. That is gonna be reports.

Yeah, that’s important. I mean, that’s another thing with syndication, it’s a team game, it’s a team sport, I think that’s good. from a standpoint of, you know, the lifestyle, you’re trying to create, you know, surround yourself with good people make sure they’re executing. And, like any business, you do have to follow up to make sure that things are going well. But, you know, it shouldn’t be a thing where you’re, you’re micromanaging them, they don’t like that, and I never liked that when I was working in corporate world, you know, I want to surround myself with really good people and let them empower them. And, but you know, you still want to follow up, make sure things are going well give them the support they need. There’s some corrective action stuff we’re working on. But, you know, by and large, this isn’t the type of business where, you know, I want I didn’t want to design my business around that, like, I have to be somewhere. And I should be able to, you know, most of my business is on the phone and email. And that’s good. I could I could, you know, we went to last fall, and my wife and I took the kids to Sydney, Australia, New Zealand, I was out of the pocket for 18 days. And, you know, we, I think we actually had a raise going on, but, you know, I even get up in the morning, or wherever the hours were and just answer a few questions. And, you know, I told people I was I was traveling, so unless you’re willing to talk, and I had a few conversations, but it did not at all disrupt my vacation. I was like, straight I can do.

Fantastic. What do you believe is the most critical skill for a syndicate or to have that would allow them to be successful?

I mean, it depends. It depends where you are. So someone’s been doing a long time. You know, they’re trying to build a business. You know, my number one thing we talked about a couple times already, and follows up is the ability to go from my business, it’s a betting I just wrote a book, my Forbes article was this, they asked me, you know, what was the number one thing that was most important to you? I said, vetting partners, I haven’t, you know, I have a special report on my way aside 10 steps of getting a partner, because investors need to know if they’re working with me and somebody else, you know, what, what’s my background? How would you get a sponsor? You know, so I’ve been very successful and fortunate. Someone asked the other day said, you know, just seemed like you guys be successful in business is my observation, looking at your website and talking to you is, you really lined yourself up with the right people? I said, wow, you know, I’m really appreciate that. And I don’t know if that was, I think part of that is being a good reader of people. You know, you was really good reader, people just saying, Yeah, I can, I can work with this person, after 20 years of the corporate world was like, pretty tell you I can’t work. I can’t wear our skills compliment, because I don’t want people that my skills are extroverted, I’ve attended college, I love to talk to people, educating people, that was my skill set, I can bring the team, other people a little more analytical. Yeah, I needed to understand the other end of the understand the financials and understand, but I don’t like to get out of the car, go look at all these deals I don’t really don’t like to do that was like a needle in a haystack. But there’s people that love that it looked people buying that deal. I’m like, I want to marry up to you, you know, I’ll provide this support for you. I think you can get yourself going and fast. By knowing what you want to focus on what area, surround yourself with the best people work with those people best you can and, you know, find a role that you think you can fulfill it fits your talents and interests, and you get excited about and then go find the others people that don’t you don’t like those skills, you don’t want to develop those skills. The worst thing I heard growing up, and this wasn’t that this isn’t a for my parents, or anything I just heard growing up was in our generation. At that time, it was like, you know, focus on your weaknesses, and your strength is just your natural. That’s crazy. You know, I read this book called Strength Finders, 2.0, it’s a great book, go read it because it was like, heck with that, go focus on what you’re really good at, you get better. Because if you’re good at it, and you’re in whatever that is, you probably love it, you’re probably you’re probably really easy for you. And if you’ve got a little bit better, I would love him more, you know, because he would say while you’re looking at, and what we want to do is know they say, Well, if you’re not really good at this, go spend some time if it’s really bad, okay? You really got bad people skills, like I could take some courses. But I mean, for a typical person, I think we kind of say, you know, we point out things that they’re not good at, or, or harp on that or just say go to it to figure that out. And they don’t like it, and they don’t, they’re not good at it anyway, if they got the expert help, they spend too much time wasting over there. You know, assess your skill sets, and all these kind of tests you can take. But, you know, for me, it took me a long time to find out, this is what I’m really good at. It took me you know, I have two college degrees, I have a Master’s was trying to figure out with the five colleges, three different majors, I try to figure all this stuff out, it took me a long time to figure it out. And then I got in the corporate world and 20 years of that I was, I was doing a lot of interesting things, but I knew I never really loved it, I was like something else like, and then and then I ran into this thing. I’m like, it’s like, you know, I give it everybody advice. I know, I look healthy. ELD, I take good care of myself. But you know, I wish if I was 30 I knew what I know now, because I would be like, it’d be no tomorrow. And you know, I’ll be doing this for just to try to like, so I leave this world and it was it’s not work for me, it’s what I should be doing. My end in mind is is to keep doing what I’m loving to do. And just keep adding layers of you know, maybe more professionalism, maybe more customer experience things, maybe maybe some new niches, you know, wall that, you know, just get into something you like and surround yourself by good people and focus on your strengths and just let that go for it. You know, the only thing people tell you, you can’t do something, if you love it, you’re going to do good.

Alright, so we’ve kind of to follow up on what you’ve just said, if you were standing in front of a room of aspiring real estate investors, and these are people with full time jobs and families, because I really believe our main listeners will be and they’re just starting out. There may be battling fears and doubts, lack of time, maybe lack of money, what are two or three strategies that you would recommend they focus on to best ensure their success?

as a follow up for someone who maybe wants to do what you’re doing so actually be the person that is finding these investors and maybe being a general partner on a on a syndication? What are some of the strategies that you might recommend for someone starting out in that arena?

Yeah, so I have a I do have a coaching and mentoring program around that. Because I think there’s a lot of people just say, that say, hey, Dave, you know, how do I get in this business and, you know, for a while, I would seem to some people that you know, have these programs and and you know how to find deals, manage deals, just like the whole thing. But I find that most people that I talked to, they have day jobs, and they have families and they want to participate above this limited partnership investment level, they want to get involved. And I find the capital raise side, one of the easiest ways to fit in, it’s not for everybody, but I think like to educate people, you enjoy that experience. And you’re kind of excited about, you know, hey, I doing these investments. Now I’d like to, you know, maybe I got some other people I talked to about this, they like this, they like, you can make some money doing this. You know, because everybody needs not everybody needs capital, I don’t care how experienced you are doing some really experienced operators, and I want a GP side of these deals, and they’re like, well, we’re going to do bigger deals day, but we’ll do more deals, but you know, keep bringing it keep bringing the capital, it’s not just, you know, people just starting out, everybody needs capital in the big companies need capital. So for me, it was, if you had a network or some kind of a network, it helps otherwise, it’s gonna be a slower process, but we teach things around, you know, thought leadership and, and that kind of thing. But, you know, so there is an approach that you can do, and you can, you know, find out who some of the operators are. And if you have some kind of a network, see if you can get opportunity to work with them on doing some due diligence, on the properties, learning about that, learning about how they underwrite and get comfortable with them, and just see if you can kind of shadow them a little bit, that would be one idea you might have, and then if there’s a role you can carve off with them, maybe you’re a person that can help them with due diligence, maybe you’re a person that’s really good at marketing communication, you can help them with their decks, maybe you’re a person that is good at customer experience skills, so maybe you could work with them working with customers, or investor base. Or maybe you could bring them you know, work with them across all of those different assets, which would I do, so I don’t just raise capital for an operator, we do due diligence with them, we help them discuss the business plan, how we might be able to add some value that they didn’t think about, we go to the properties with them, we spend time on their marketing and communications of materials, and we help them edit those and we help, you know, shape those pretty well. And then we do talk to our investor base about the opportunity to educate them about the deal. And then once you’re in that deal, we’re communicating with those investors, it could be at three, five, I’ve got some deals, or five or 10 year holding periods, and you have to be communicating with these investors for that long, you know, so I’ll probably never be out of business. But you know, it’s a big responsibility to keep communicating with these ambassadors. And it’s it you can get involved in a variety of ways. But you know, just expose yourself and see where you can add value to and don’t ask for, you know, don’t ask to be on again, you’ll get a wage out of this. This should be a side thing that you work your way into, but I find a lot of people like it because it works well with a daytime job you can you can have coffees, you can have some lunch meetings, you can have some weekend, a coffee meetups, you can you can do some meeting phone calls, you can fit this in, you know, talking to investors and educating them and making sure it’s the right fit and, and bringing some capital to the sponsors.

Awesome. Great. Well, David, it’s been really great talking to you if our listeners want to reach out what would be the best way they can do that? Yeah,

so so it’s my email is David at Thompson investing calm. That’s all one word Thompson investing th om PSON, investing calm. And my website is WWE Thompson investing calm. So the website also has a content capture page. So if you want to get the information there, and we can get you our newsletter, and start getting exposed to some of our blogs and, and things that’s available to you to further your education.

Right. Thank you so much. Yeah, well, thanks a lot.

great talking to you. Alright, well, that was David Thompson, always great talking to David. And I love his niche because it allows him to those of us who suffer from suffer from shiny object syndrome. I’m not pointing any fingers. A lot of it is not necessarily because oh, there’s that. There’s that Oh, there’s that. But there are a lot of really powerful niches out there. What it allows David to do is be involved in a lot of different niches. Now he’s focused, he’s not just jumping all over the place willy nilly. And he started with one niche multifamily, and moved into self storage and then manufactured homes. So

yeah, he’s essentially he’s diversifying, but he’s staying within his wheelhouse at the same time. It’s the same strategy. It’s just taking it to a different market. So I think I mean, he talks about kind of that diversification within geography and an asset class, that kind of thing. And that was really important, because it actually reduces your risk. You’re not putting all your eggs in one basket. Okay, well, so how much knowledge does this take? And I think maybe we probably should look at some of these things with doing what David actually does, and maybe being an investor in those types of deals. Because it’s it’s two different, completely different times money, you know, all that the commitment is completely different. But I think they’re both valid pieces, depending on what you want.

Yeah. Well, I would say as far as David, the syndicators, David said, he spent at least a year, he kind of just actually he said, he just went sort of right into it. Yeah. But at the end, when he sort of talked about he said, he recommended about a year of educating yourself on bigger pockets, and reading books and networking with some of these experienced syndicators,

possibly doing a program with someone. Yeah, mentoring program, that kind of thing. Awesome. And then as far as your knowledge investment, if you want to do investing with our syndication, just as a limited partner, I mean, that knowledge base actually doesn’t require much means probably days to months worth of time kind of learning. And it’s really his job. What he does, it says job to educate you, and didn’t sound like there was that much time involved, a lot of it was just sort of logistics and learning about the risk and that kind of thing. So even just a 30 minute conversation probably help someone who is even specially someone who’s already sort of experienced in investing in general, even if it’s not real estate, but as you know, has money that they invest in other other places, and they’re probably going to be able to understand the basics pretty quickly.

And as David as the syndicators, did you get a feel for how much money it took him to get started?

He never really answered that question fully, which is okay. Um, I think I would say probably in the thousands was, it depends, you have to be an accredited investor, which we didn’t actually talk about what that means. Sure.

We’ve talked about it on other podcast, but I sort of got the feel that syndicate or you can actually, what I found interesting that David talked about in lieu of money, and that’s part of what the power of syndication is, it’s not about so much about the money that he needed to get started. But the track record, and the trust, and those those are his capital, starting with and the way that he built that up, is he actually partnered up with people who were experienced and have the track record.

Yeah. And also, we’re putting some money towards it, it sounds like that, as a general partnership, Amy, depending on the deal, I think he said on that $1 million deal. He was saying, like someone might bring in 30,000, or something along those lines. So you know, if you can between the general partnership bringing in a little chunk, or probably about what an individual investor, if the general partners aren’t investing as much as an individual investor, that’s probably that, you know, what they’re looking for, as a minimum?

Well, that is typically my understanding of it is that you typically want to invest at least as much as you’re asking your limited partners to invest in so if your minimum investment for your investors is $50,000, then the expectation is you’re going to invest at least money.

What’s nice, though, so you can do that as the general partnership. Yeah. And split that up. So if you don’t have that, that cash right now, then then you you know, you kind of you can lend your your skills, as we said, to the general partnership, and maybe not as much money.

And then, as far as a limited partner, what he talked about was that, typically, the minimum investment is 25, to $50,000. And I would say more often than not, in my experience, it’s closer to $50,000. There are some syndicators who will bring somebody in for that for for less than that, but it’s typically $50,000. But what you’re, you’re getting out of that is, you’re a limited partner, which means you’re not you’re not signing on the loan, you’re insulated from a lawsuit, and you don’t have to do any work other than vet the sponsor and vet the deal. And then cash the checks,

no problem. Well, that brings us to time. So for that limited investor, obviously, the time is really minimum, it’s all mostly up at the front and the deal, and then you’re able to sort of depends on how interested you are. You know, you could really just take your money and ignore all those emails, all those reports, and really not spend much more than a few minutes a month. It’s

true. Truly, it’s passive investing. And that’s it really is one of the ultimate testing. As far as David,

I mean, that it’s hard, because it’s kind of like if you ask someone who owns their own business, they probably don’t know how much time they put in. I mean, as a nutritionist, I have no much how I have no idea how much time I put into my actual business, because I’m probably doing it 90% of the time, especially because it’s something they love to work with food, you know, I love it, he comes to the same thing, you find something that you love, and then you kind of do it, it doesn’t feel like you’re spending that much time on it, you sort of forget. So it sounds like he is putting quite a bit of time in right now or has been this year, and that that’s something he wants to sort of curtail a little bit. But you know, like, I’m guessing he probably 10 normal jobs worth of time, I

would say. I would say at least 40. I’ll even go maybe 40 to 49.

Yeah, yeah. Awesome. So location, how location independent is apartment syndication?

I would say it’s very location independent. Not apartment, syndication. And you know, David, I know that David, David typically goes and visits, the properties that he’s going to invest in, and in the beginning, when they’re doing their underwriting. So there certainly he has to be on location. There a little bit. And then beyond that, it’s really just sort of maybe once a year,

yeah, yeah. Well, what’s nice is that, you know, depending on where you’re investing, you can really, if you want to have a life where you’re traveling a lot, you know, that’s something that you can kind of build into that you can go Okay, well, we need to visit and, you know, a property that’s in this area of Texas, what what’s around there, you know, or like, we have a, you know, like, you would also invest in places that you know, you want to be going to regularly you know, but yeah, there’s any kind of amusement parks or worse scenic places, camping, things like that, you can kind of go Okay, what can I do around here and and you get to travel as a perk part of your job and get all those write offs and stuff to lots of benefits to that. And then I guess I’m the limited investor side, there’s really no, it’s completely location independent, because you’re not really doing anything with that.

And I do know, some we spoke to Jeremy roll back on one of our previous podcasts, and he talks about, he actually as a passive investor, he goes, and he visits every single one of his properties when he’s investing in. But once he does that, then you know, then he trusts the syndicators. They’re the ones who are the boots on the ground doing.

Yeah, and that’s the choice of the investors investors may not go that extra mile so I’m really infinitely Yeah, go on without without actually ever visiting a property. Awesome.

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