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Reinvent: How To Pivot Careers And Invest In Real Estate With Ben Fredricks

February 15, 2023

chrisseveney

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CWS 237 | Real Estate   Our guest today started as a real estate investor and went into the banking side. A recession happened, and they were out of business, but later on, they went back into real estate investing. In this episode, Ben Fredricks, co-owner of Noteworthy USA, shares his journey and how he pivoted his career into real estate investing. Today, most of Ben’s business is more rentals because today is a great opportunity to do rentals. Figure out why Ben thinks today is a great opportunity to do rentals by tuning in to this episode!

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Reinvent: How To Pivot Careers And Invest In Real Estate With Ben Fredricks

Welcome to the show, where each week we bring you education and information that will help you take your next step in building wealth through real estate. Joining me now is Ben Fredricks. How are you doing? I’m doing great, Lauren. Thanks for having me. Thanks for joining us. After careers at different Fortune 500 companies like Lehman Brothers, New York Life, and Allstate, he became a full-time investor in 2016 and has since done over 500 transactions. Primarily, he’s focused on buying properties from auction and flipping, but he has also created over 100 seller finance notes, which we will talk about now. He is a Partner at Noteworthy, which has their event coming up, which we will also talk about in a little bit. He also owns 35 single-family rentals and 19 multifamily and runs 2 Airbnb vacation properties. You have a lot going for you and you’ve done a lot. Where do you want to start? Tell me about being in the corporate world, what that was like, what caused the change, and where you wanted to go. It was an interesting transition. I started as a real estate investor when I was working for Lehman Brothers. My background was mortgage. I went into the banking side, and that’s where my career was focused with them. I might still be there now if it wasn’t for the recession and they’re going out of business. It was by attrition that I got out of the corporate world. It didn’t immediately end there. I spent another eight years in financial services between New York Life and Allstate, which I hated every single minute of. Once the recession took over, my wife lost her position working for JPMorgan Chase. She decided to reinvent herself and become a chiropractor. I was like, “Once you’re done with that, I’m getting back into real estate.” I wasn’t real sure how I was going to do that because we had gotten crushed with real estate that we had bought when things were going great. We just bought it at the wrong time. It was a lack of education. It wasn’t that we were buying these dangerous loans where we were putting no money down or whatever. We were putting money into the deals. We were like a lot of people where you get caught at the wrong place at the wrong time. It was what it was. The transition happened when you just get to a point where you’ve had enough. Tony Robbins talks about this sometimes. You’re like, “I can’t keep living my life like this” I was miserable at work. I wasn’t enjoying my career. I only was doing it because it was one of the few places you could get a job in 2008. The biggest change and the thing that made me make the jump was when my daughter was born. I don’t want to be a guy that is showing my daughter that he’ll just be miserable and go through life not pursuing his passions. I started putting out into the world what I wanted. I started reading a lot, listening to a ton of podcasts, and trying to get my education to where it needed to be, where it wasn’t before. I started devouring stuff, going to different events, and all that. At some point, it clicks. I love that. Now, with all of the layoffs, not necessarily in finance, but in tech, we’re seeing a lot of the same. I look at it as there’s so much opportunity in an odd way to reinvent yourself. It was a combination of timing and your knowledge of what you had done, and capitalizing on that to create that opportunity. We’ll see a lot of that come out of what’s happening now, even though it probably doesn’t seem that way to a lot of people. It definitely will happen. If you look back to the last recession, some of the biggest companies started coming out of it. Uber wasn’t even a thing back in 2008. Shortly thereafter, here comes Uber, Airbnb, and all these big, huge companies that we see right now. There are definitely seasons. There are seasons to our lives and business as well. Now, one of the things I’m studying and trying to learn a lot about is AI. That is going to be one thing that’s going to be a game changer potentially for people that are at the forefront of it when it comes to investing. The tech people might have an advantage over us, people that are not tech people, but it’s something I’m looking at.
CWS 237 | Real Estate

Real Estate: If you look back to the last recession, some of the biggest companies started coming out of it. Uber wasn’t even a thing in 2008. Then shortly comes Uber, Airbnb, and all these huge companies we see today.

  I know we’re going off topic a little bit, but tell me about what you think will happen and what the impact of AI could be with people who are looking to invest or get started. Ultimately, it will help increase the speed. A lot of times, that makes a big difference. When I buy a lot of deals at auction, it’s because of speed. People know that we’re going to close the deal. That’s why we get some of the deals we get and that’s why we get some of the bad deals that we get because we’re buying in bulk and we know like, “I’ll take them. I don’t even need to see them. I don’t go out to them. I don’t inspect them. Nothing.” I make my offers accordingly, but it’s the speed of it. With AI, I will have the ability to get even faster and improve. Maybe that’s going to be across a multitude of areas. It might not be just real estate investing. It might be investing in different things. That’s one area that real estate investors can use. You’ve started consuming all the education you could around real estate. What was your first deal and action that you took to have your first investment after the recession? After the recession, I won’t forget it because I had some friends in South Florida that knew I was wanting to get into real estate. They were from South America and were like, “We have money. We want to find real estate. We don’t have the time because we’re building these other businesses. If you find a deal, let us know, and we will go in on way with you.” We had trust and rapport from many deals together before. I started putting out into the universe what I was looking for. Craigslist became my best friend, weirdly enough. There are some strange people on Craigslist, but you also might find something that will change your life. I tell people this story all the time that Craigslist did change my life. I had put an ad on Craigslist saying that we had deals to do money. A guy that is my mentor now and my partner called me and said, “I’ve got a bunch of these deals from an auction. If you can fund them, we can do them together.” That was the first step. I don’t know if you ever saw the show The Wire on HBO back in the day, but it was about cops in Baltimore, drugs, and all this stuff. One of the houses I had bought was a row house in West Baltimore, not an area you want to hang out in, very scary. I bought it for $500. I was like, “You can make money off these deals?” He’s like, “Yes. You’ll be able to sell that for maybe $3,000 to $4,000, and you’re in.” I was like, “Okay.” For me, it was just an experiment. I was like, “I can throw $500 away to see how this works.” Sure enough, I bought the property, and within 60 days, I had sold it for $3,500, and was on my way. Years later, I saw that property on an episode of The Wire. I was like, “I think I owned that at one point.” I started very small like that, and then I built a track record. I did ten deals. All I started doing was started sharing my experience, and next thing you know, we had raised $150,000 and bought 12 deals at one time and started snowballing from there to where we were doing $100,000 in a year. When you were going through this, did you have set criteria for states you wanted to invest in and types of properties? If so, how did you come up with that criteria? I had to throw some of that stuff out. Here’s the thing with auctions, if you’re in one market, you know this is my buy box. I only want three twos and 1,500 square feet. For me, I had to start thinking a little bit differently and had to unlearn some of the stuff that I had learned just like that. I had to start looking at deals as they came through on auction and saying, “1) Is this typical for the area? 2) If I’m going to be seller financing this, can I sell it and have it at a cheaper price than what local rents are?” That way, it’s a no-brainer. If somebody buys this deal, why would you screw it up? It’s going to cost you more to go rent. That was with principal interest, taxes, and insurance. That was my criteria. I wanted to beat the rental market and was like, “Does this look like a good starter home for somebody?” I had to flip around how I was looking at deals from an auction standpoint. From state to state, I’ve bought things from Hawaii to Maine. It’s been all over the place. You would essentially look more at, not buy box agnostic, but the exit strategy, and if that made sense, more than the actual criteria of the property. We had three different ways that we could exit a property. I could go in and just flip that property to somebody local in that market. I could seller finance or potentially rent it. There were different ways that I could look at the deal, but your description there is not far off, agnostic. That’s a great way of looking at it. I can’t take credit for that. One of my colleagues coined something else, asset agnostic. I was like, “I love that term.” Are you still buying houses at auction, or did you transition away from that because your portfolio is beyond just single-family now? Auctions over the last couple of years have not produced much. Banks were taking a wait-and-see approach to COVID, and like, “What are we going to do here? Are we going to rework these loans?” It wasn’t like 2008 when there was this avalanche of properties coming into the market. We did have to reinvent ourselves. Where we were used to buying anywhere from 10 to 20 deals a month, now, it was going from 4 to 7 deals a month. That’s not sustainable for the model that we had. We need to put money to work. We started buying more rentals. In the last 120 days, we’ve added 47 single-family units to our rental portfolio. We started doing some Airbnbs. We had to pivot a little bit. Auctions will always be going to fluctuate, so there are always going to be peaks and valleys there. That was one thing. It took me a while to figure that out. My mentor would always say, “There’s going to be times when auctions are heavy, and sometimes, when they’re not. You just have to figure out how to navigate between them. Sometimes, you want to hear things and sometimes you don’t.” When he would say that to me, we’re in the thick of it. Many deals are happening and you’re like, “Sure. That’s going to happen.” Sure enough, it does, and you’re like, “I should have listened a little bit sooner.” It’s still working out well. I love the game. We really enjoy what we do. There will be times where auctions are heavy and sometimes when they're not. You have to figure out how to navigate between. Click To Tweet Your prediction for auctions in the next couple of months, where do you see that being? This is just hearsay from a lot of the contacts that we have in our business. A lot of the asset managers are telling our contact in auctions that we can expect auctions to pick up more again probably in the third quarter of 2023. I heard some of that in 2022, too. I take it with a grain of salt. I don’t depend on that happening, so I’m constantly looking for other deals. One thing that we bought a bunch of deals from was wholesalers as well. Wholesalers are starting the game a lot of times. I know wholesalers do it professionally, but for a lot of them, that’s like their foot into the door of real estate investing, where they can become an owner. We’ve done deals with wholesalers that didn’t know how to structure, or we’ve done deals subject to or bought the deal, turned it around, and sold it on seller financing. Those are things that they could have done if they had known about it, but they didn’t. It’s bringing that creative financing and the money to the table, and then the other person brings the deals. It makes a good partnership. When you pivoted and had to reinvent yourself away from auctions, not that you don’t do that anymore, but when you had to expand to keep up with the business model that you wanted, did you then set specific criteria because it was a different buy process? We had to. We had to go into that mindset again, which was, “This is a rental. Now, we got to think about what market rents are. Is this the type of square feet that people want?” We did have to go back to that a little bit. We bought a couple of package deals from one seller, and most of those fit that buy box, so it was like, “We’ll take it.” The thing is I don’t hurt for confidence because we’re buying stuff sight unseen. Usually, if a deal comes across my desk, I can look at it and be like, “We’ll take it.” Has that always worked out? No. For the most part, my instincts are pretty good at this point, so I know what I want and what’s going to work. At what point did you have to scale beyond yourself? You have quite a handful of units at this point. I’m imagining that’s all not something that you’re managing alone. At what point did you feel in your investment journey that it was necessary to bring on additional help outside yourself? Pretty quickly. I always say this cliché, but I was working eight days a week like John Lennon. It was basically like I have this new baby at home, and I’m excited about what I’m doing. As soon as I would come home from the office, I’d work more. I’d work till 10:00 at night, lining up deals and everything else, trying to figure out the accounting. I’m at the office on Saturday and Sunday for full days. First of all, I’m missing out on my daughter growing up here, and it’s not sustainable. I started to get a little bit burnt out. Isn’t that the irony of it? I have two young boys myself. That’s what prompted my exit from the tech world into this. In the beginning, you have to go and commit more time to then have more time in 1, 2, or 3 years. A common misunderstanding I see with people who are investing is, “If I invest, I have that financial freedom and time freedom overnight.” It doesn’t have to be a twenty-year long-term game, but it’s not an overnight success as a lot of people think. I love that you brought that up. I was working at home. I have this little baby at home. It’s not like I’m hanging out with her all day and just cruising because I have a few things to do. That was a good point that you made. It was tough. I read a great book called Rocket Fuel, which is great. I recommend it to everybody if you’re in a spot where you’re trying to grow and reached your limit. I’m a high visionary. I learned very early that from an operations standpoint, that wasn’t where I wanted to be spending my time. What I did was I started writing down everything that I was doing in a day, every single thing I was doing from the moment I got up till the moment I went to sleep, and was like, “What are the things on this list that I can get rid of that I don’t need to be doing? These are not making me the money that I want to make.” I started making that list, narrowing that down, and I did that exercise for a couple of weeks. I had this big piece of paper, and it was all filled out.
CWS 237 | Real Estate

Rocket Fuel: The One Essential Combination That Will Get You More of What You Want from Your Business

I don’t know about anybody else, but I do some of my best thinking on an airplane. I don’t know why. You’re in the zone. There’s nothing else to do. You’re trying to ignore the people around you and just focus on yourself. I went on a trip. We were going to a conference. I had the paper with me, and I was taking notes. I walk in, and there’s this booth for virtual assistance. I go over to the guy, hand him the piece of paper, and was like, “Help me. This is all the stuff that I need to be done. Do you have someone that can help me?” He was like, “Absolutely.” Here we are a couple of years later, and I still have that same assistant. I have two assistants now. I have an operations manager. As soon as you can get help, do it because it frees you up to do the things that are the highest revenue producing but also have a life outside of work, which is very important. What’s hard for a lot of people who are very entrepreneurial to get to is to give up control. That’s just one little thing. Like you said, you’re the visionary. You should be focusing on those higher-level things that are going to move the needle further, not filling out the paperwork, doing the due diligence, or whatever those things are. I love that. It’s something that I know I’ve struggled with personally. It’s hard because you’re always thinking, “Nobody’s going to do this as well as I do it.” You start creating systems and processes that you can manage, check, and make sure that they’re running efficiently. We got so good at it. The same assistant that I have in 2022, I was like, “Let’s start our own assistant company where we know this game already, so we can just place people into a system that works.” We know what real estate investors need to do on a day-to-day basis. We know what they’re posting in terms of social media content. They know contracts, seller finance, and all these different things. We’re more of a niche in terms of the note side of it, but it works. That’s how easy it is to duplicate something. Once you get the system down, then you just duplicate it, and it can run on its own. We started with buying properties at auction. Pivoting into rentals, is that where you’re at now? Both. I’m still buying properties at auction. It happens to be a lot more rentals in the last quarter. Now is a great opportunity to buy rentals because people are at the top of where they were, and we’ve seen the market start to correct a little bit, even though there have been articles in terms of rents starting to come down. A lot of the landlords, especially after COVID, were tired, and so these deals are easy to get right now if you’ve got the funds to take them down. Even if you don’t, that’s where creativity comes into play. Especially if you know notes, if it’s in your wheelhouse to create a note or buy a note, you should be very good at pitching how to get the seller to finance it to you. I love this. I’m going to ask you to do that. If I was a seller and you were trying to pitch me, what would your pitch be? One of the key questions for a seller is, “How many properties do you have?” A lot of people start with the one that they’re looking at. I always ask, “Is this the only property?” That has gotten me packages of deals. The next question I want to ask them is, “Do you need all of that money now? If you get all that money, what are you going to be doing with it? I know that’s a personal question, but out of curiosity, if I wrote you a check for $200,000 now for these properties, what are you going to do with that money?” I then shut up and listen. A lot of times, they go, “I’m going to do this, that, and the other.” “How much of that are you going to owe to the IRS?” Sometimes, they forget about that. I say, “What if we could reduce your tax bill and give you this money over a period of time? I’ll give you a chunk of money now, and then I’ll give you the rest over a period of time. I’m willing to buy it at your price just at my terms.” That’s gotten me a bunch of deals. That’s the simplest way of just giving you a one-minute answer on that. That’s great. Something that our audience like to read is people often talk about you having to talk to the sellers or this is what you should do. Walking through what that looks like for someone who’s new to investing or just starting to where you were several years ago when you were consuming all that content and information, it’s really valuable to hear, “This is what I would do, this is what I’ve done, and these are the questions I ask.” Unfortunately, it doesn’t work every single time. A lot of times, people need the money now. There might be a health situation, a partnership that needs to be paid out, or whatever the case may be. That’s where private money comes into play. If you’re very good at doing that, that solves the problem, too. You’ve touched upon a few things as you’ve been talking. One, the education that you immersed yourself in the beginning, but then also it seems like you’ve built, and this comes up in every other show episode we record, the network of people that you’ve surrounded yourself with, from your mentor to people that have deals when you have money. How did you start establishing that network? First of all, I started going to events and meeting people, which is not my strong suit. I’m shocked by that. If you knew me well, you would know I’m highly introverted. To be here with you right now is a struggle. I have to push myself to do it, which is funny because I get on stage at Noteworthy and get up in front of people and all that stuff. It produces a lot of anxiety. Usually, at events, I would be the guy standing in the corner, “How do I get out of here?” I forced the issue there for myself, getting out and meeting people. For me, I love talking about real estate, so that does make it a little bit easier. A lot of that stems for me being in the financial services space. I hated talking to people about that. It took me a while to get over it. That was almost like post-traumatic stress disorder. Once I did, I could easily sit and talk to people about real estate because it’s fun for me, it’s a game, and it’s like Monopoly. Going to events is good. Joining masterminds, I’m in a couple of those, so I get to hang around with like-minded people. They get to know me and understand what it is that I do. If you can get into those kinds of spaces, you’d be amazed at the people that you can meet. They want to do deals. They are wanting to meet people that are doing deals. It’s all very synergistic once you get comfortable doing it. Going to events is really good. If you can get into those kinds of spaces, you'd be amazed the people you meet like that want to do deals. Click To Tweet I love that you said you’re an introvert because I am clearly an extrovert. We’d have a whole episode on networking. From my perspective, it’s very different, and it’s good to hear someone else’s perspective who is an introvert, “This is what I did, even though it wasn’t super comfortable.” You focused on what you love talking about, which is real estate. I also like learning about other people, too, and what they’re doing. It makes it a whole lot easier when you’re networking if you just ask about the other person. I much prefer that than talking about myself and what it is that I do. Looking forward to the next couple of months, we talked about auction specifically, but are you anticipating any pivots that you’ll be making in your business or different areas of financing that you’ll be focusing on? I’ve heard in the last few episodes that subject to is something someone’s focusing on or looking into more. What are your thoughts? One of my major goals for myself this 2023 was to do less. For most people that are visionaries or entrepreneurial, it’s very easy to get distracted. You can get ideas to go do this or do that. In 2023, I have a note on my desk, no shiny pennies. I’m not chasing any squirrels, I’m focusing on the thing. The thing is cashflow. If it produces cashflow and it’s real estate related, let’s go. If it’s not, I’m not in. One thing I’ve spent a lot of time over the last couple of years learning is that distractions are not worth it. Focus on one thing. Every time that I’ve done that, I’ve grown substantially. When I take my eye off the ball, I’m missing. I’m doing less. That’s it. I’m doing more deals, but I’m doing less of everything else. Focus on what you know about your system that works. That’s it. There’s no real secret sauce to it. That’s just it. Do the work, focus, and go. There's no real secret sauce to it. Just do the work, focus, and go. Click To Tweet Talk to me about Noteworthy. You became a partner in the company after attending their events. I’m assuming that’s one of the events you were talking about having attended for several years. How did that come to be? Tell our readers a little bit about it. Noteworthy is where I learned the business. I initially went there as a vendor because Dodd-Frank was a big thing. My mentor, when I first started working with him, he’s like, “You should get your mortgage license again because a lot of the investors I’m working with need help with this Dodd-Frank thing.” I was like, “I’ll do that.” I went and got that done in two weeks. I then started being a loan originator for all these investors. I was learning from the inside out how to do all this stuff. There was this conference called Noteworthy. One of my mentor’s investors told me about it. He is like, “Come out to California. You can come to check it out.” I was like, “Okay.” I went out there and started out as a vendor. I would have my little booth there talking to investors and getting real comfortable talking to people about whatever. When the breaks were over, when people were speaking or educating from the stage, I’d be in there taking notes on everything. I was essentially getting a free education on notes as well. I did that for several years, and then I stopped doing the MLO thing because I didn’t have time for it anymore. I kept going to Noteworthy because it was great to learn. A few years ago, I got the note investor of the year. They were gracious enough to give me that. One of the owners, Aaron Halderman, called me and said, “I’m curious if you’d have an interest in joining me in Noteworthy.” I was like, “I never considered it, but I would because it’s given me so much that for me, I just looked at it as an opportunity to give back.” Putting on events, they’re not big money makers. That’s not why you do it. You get to be a center of influence, meet a lot of people, do more deals, and things like that. We also get to help people, which is really cool. For some of the people that have never done a note deal, it’s exciting to see them get it and start to put things together that I could do more than just wholesaling or rental property. I’m probably leaving deals on the table. I told him when we started, “If I get involved, I’m not getting involved in an organization where it’s like, ‘Run to the back of the room and buy our $40,000 coaching program.’ I don’t want to be a part of any of that. I just want to keep it strictly educational. Let’s build a tribe of people.” That’s what we’ve done. We’ve always had great speakers that come out that want to give. These are people that have been doing it for a long time. Those are the only people we have out. If you’ve got a course to sell, I’m not interested in having you. It’s a passion project, for sure. We have one coming up at the end of February in Anaheim, California, so I’m excited about that. It’s always a lot of work and stress leading up to it. I always say, “No more events. I’m not doing any more events.” Afterward, I’m like, “We’ll do another one.” They end up being a lot of fun. We get to hang out with people that we don’t see, but maybe once or twice a year, and deals are always done. That’s a big reason why I got involved. For those people reading now, going to a conference where it isn’t a pitch fest of people pitching courses, masterminds programs, and mentorships is pretty rare these days. I love that it’s more educational focus. You probably have sponsors, but I love that it’s people who want to be there to educate rather than get people to sign up for their program. That’s awesome. As someone who has been to a lot of events, that’s super refreshing to hear. I don’t belittle people that sell courses. I’ve learned a ton from courses. I just want there to be some more connection that’s above and beyond doing a course. When I started out in notes, I took a few courses that were super helpful in getting started and have a few mentors that came from that industry. I agree. It provides better conversation when that’s off the table. What can people expect at this event in a few weeks? I’m excited about it because we’ve got some amazing people coming out. Our in-house trainer, Kevin Shortle, always goes through the underwriting process that he uses to underwrite big packages of notes and how he’s going through everything, due diligence, understanding performing and nonperforming, how to make the right offer, and all that good stuff. A good friend of mine, Dan Zitofsky, who I learned how to raise private money from, helped me raise millions of dollars in private money. He’s going to come out and give his entire presentation on how he raises private money, something that he charges thousands of dollars for people to see. I was like, “You can come out, but you’re going to do it. You’re going to give it to people.” I’m super stoked about that. I’ve got an expert coming out on subject to. He’s going to tell you how he’s creatively acquiring a bunch of deals using that because so many low-interest-rate mortgages were done over the last couple of years. It’s ripe for the picking. Especially with the layoffs, it’s going to be a win-win for the seller and the person assuming. That’s one of the bigger things to learn. We have some different things that are maybe not necessarily related to real estate but are also cashflow-based. There are different types of investments that you can make that are passive. I can’t say enough. The people that we have coming out, I’m not going to give the entire thing away. You can go to our site and see what our agenda is. I have a foreclosure specialist coming out from California that teaches you how to buy foreclosures before they even get to the market. I’m going to be talking about seller finance and how we’ve done a bunch of deals and created notes from auction properties. There’s a ton to be learned. Do you know what the idea really is? When people go home, they have something that they can take immediate action on and start executing. We always tell people, “You’re going to get a bunch of information, but the idea is to pick one or two things, start hammering on that, and then you can come back and keep picking up other stuff along the way. Start taking action and executing on 1 or 2 things as soon as you get home.” They’re going to leave with the tools to do that.
CWS 237 | Real Estate

Real Estate: Pick one or two things and then start hammering on that, and then you can come back and keep picking up other stuff along the way. Start taking action and executing on one or two things as soon as you get home, and they will leave with the tools to do that.

  That was a great segue into the question that I always love to ask everybody. We rebranded this show and focus each episode on what is a piece of advice that’s actionable for someone starting out in real estate now. If I was starting over here would be my three-year plan, which was wild, that was the first time that had happened, and it was pretty awesome. If you were starting now, what would be your piece of advice for someone who is looking to leave their 9:00 to 5:00 and build something for themselves? The first thing that you need to do is you need to learn how to properly evaluate a deal. It doesn’t matter if it’s a rental, a fix and flip, or a note. You have to learn exactly how to evaluate that deal and understand that you need to stick to the numbers. I never get emotional about a deal. There have been deals that I wanted, but I wouldn’t go above the number. Sometimes, you just have to walk away. The next thing that I would do is if you’re interested in notes, the number one thing I would do is read Jimmy Napier’s book, Invest in Debt. That’s a blueprint to understand notes in a couple of different ways. If you understand what note buyers want, you can go out and create them. You’re creating the market for what people already want, the product that they already want to buy. That’s probably the next thing. I would learn rental and figuring out subject to and all that. I’m giving you more than one thing here, but this was my checklist. Get great at raising private money. That’s going to be the catalyst over the next 12 to 18 months because there’s going to be a lot of money sitting on the sidelines if a recession digs in, where people are going to be scared. If you get very confident and good at raising money and you can show people how they’re going to make money, and most importantly, get paid back, that will be a huge separator for you as an investor.
CWS 237 | Real Estate

Real Estate: Get great at raising private money. That will be the catalyst over the next 12 to 18 months because there will be a lot of money sitting on the sidelines if a recession digs in.

  I was talking to someone about that. He said pretty much almost what you said in one of your last points. If you have the money, everything else will follow and the deals will come. Obviously, you have to have that network. If people know that you’re serious, you close, and you have the funding, everything else falls in line. It makes all the difference in the world. It’s the difference from a couple of deals a year because you’re scraping together your own funds. If you can use OPM, you can start to scale it up. When you were starting, were you starting with your money or other people’s money? We started with our own. How many deals did you say, “I like this, and this is working?” When it comes to raising private money, how did you start? We went to our natural market first. One thing I did learn in the financial services business is you go to your natural market first because they know you, trust you, and it’s a little bit easier conversation to have sometimes. That was the thing we did. We did about 5 or 6 deals, and then we had a spreadsheet. I created a presentation and said, “Here’s what we’ve done. Here’s what we could do if we had more money. We could bring you in as a partner or pay you a percentage or an interest rate.” That was the catalyst for our first round of private money, which was about $120,000. It went up from there. You go to your natural market first because they know you, trust you, and it's just a little bit easier conversation to have sometimes. Click To Tweet Ben, tell our audience where they can find you, where they can connect, and how they can follow you. I spend most of my time on Instagram, which I don’t like to but I had to. It’s @BenjaminFredricks. You can find me there. You can connect with us through Noteworthy. We have a couple of different Noteworthy pages. We have a note investors page. If you just type Noteworthy into Facebook, you’ll find us. NoteworthyUsa.com, you’ll find our events. By the way, we publish a great newsletter that you can subscribe to for practically nothing. It’s full of great content every single month on being an entrepreneur, note investing, rentals, subject to, private money, self-directed IRAs, and tons of great information in there that you would find helpful. Those are the places you can connect with me best. I love it. Thanks so much for joining me. Any final thoughts? I’m glad to be here, believe it or not. This is great. I always say at the end, “I’m glad I did that.” Now, I’m genuinely glad I did this. This was nice. Thank you for having me. I appreciate it. Good. I was worried there for a second when you’re like, “This is a lot.” This was great. Thank you so much for having me. I appreciate it. Thank you, everyone, for joining us on this episode. If you enjoyed the show, share it with a friend, subscribe, or leave us a review. Until next time. Thank you.  

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About Ben Fredricks

CWS 237 | Real EstateAfter a careers at Fortune 500 Companies Lehman Brothers, New York Life and Allstate, Ben became a full time investor in 2016 and has since done over 500 transactions. Primarily focused on buying properties from auction and flipping properties, Ben has also created over 100 seller financing notes to create passive income. He currently owns 35 single family rentals, 19 multi-family units and runs 2 AirBNB vacation properties. After attending NoteWorthy events for several years, Ben became a partner in the company to help others find their path in the note and real estate investing space. lives in Port Orange with his wife Kelly of 15 years and their 8 year old daughter Stella. NoteWorthy is a publishing and event company that produces a monthly educational newsletter for cash flow investors as well as annual events in the space where they focus on bringing in speakers that are willing to give back the knowledge they’ve learned to inspire a new generation of cash flow investors.

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