Raising Capital For Real Estate Private Equity – Bronson Hill

 

One key aspect when it comes to real estate deals is raising capital. Bronson Hill, CEO of Bronson Equity, is here to share wisdom and expertise on the topic. Bronson has raised over 20 million for real estate investments and is a general partner in over 150 million worth of real estate around the world. He knows what he’s talking about. In this episode, he shares mindset strategies for passive investors to learn the mindset to become successful investors and for active investors to learn strategies to raise capital for their real estate deals. Don’t miss the golden nuggets from Bronson that will help you understand the science and art of raising capital.

 

Get in touch with Bronson Hill:

LinkedIn: https://www.linkedin.com/in/bronson-hill-b4843910/

Website: https://bronsonequity.com

 

If you are interested in learning more about passively investing in multifamily and Build-to-Rent properties, click here to schedule a call with the CPI Capital Team or contact us at info@cpicapital.ca. If you like to Co-Syndicate and close on larger deal as a General Partner click here. You can read more about CPI Capital at https://www.cpicapital.ca. #avabenesocky #augustbiniaz #cpicapital

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About Bronson Hill

Bronson Hill is the founder and CEO of Bronson Equity, which has raised more than $20 million in capital for real estate investment. He is a general partner in over $150 million in real estate across the United States.

Bronson is an apartment investing expert who is constantly creating new content to help educate investors and help them achieve financial freedom. He previously worked as a sales consultant for several large and small medical device companies.

He is dedicated to educating others about the advantages of passively investing in multifamily syndication. While most people have never heard of it, it allows individuals to own a portion of large apartment buildings while receiving exceptional tax benefits and earning high returns without the volatility of the stock market.

Raising Capital For Real Estate Private Equity – Bronson Hill

We have another incredible show for you. Please like and subscribe as it helps us build our channel and allows us to keep bringing you great content and expert guest speakers. Our mission is to empower investors to earn passive income through real estate investing. We’re excited because we’re joined by Bronson Hill, the Founder and CEO of Bronson Equity, and has raised over $20 million for real estate investments. He’s a general partner in over $150 million worth of real estate around the US.

Bronson is an authority on apartment investing and is continually putting out new content to help educate investors and help them achieve financial freedom. He spent his earlier years as a sales consultant for several large and startup medical device companies. We believe this interview with Bronson will bring great value to passive investors, to learn about the mindset to become successful investors, and for active investors in learning strategies for raising capital for their real estate deals.

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Welcome, Bronson. Thanks for being here.

I’m excited to be here. Thanks for having me. I love talking about investing. Passive investing is something we should all aspire to, whether you’re active or more passive. Receiving checks and income without having to work for it is amazing.

We’ve been connected for a while on LinkedIn. I’ve seen you around in this space for a long time, but I never got a chance to research you. When I research you before the show, I’m excited for you to come on the show. You have a wealth of knowledge and experience, so I’m looking forward to this show.

August, I left the room for two seconds. He’s like, “Ava, you got to come back here. Bronson is dropping gold.”

Thanks. I’m honored. I’ve learned some things. I love sharing it. That’s how we learn from each other. I’m excited to be with you, guys.

Why don’t we start off, Bronson? Would you tell us about your background and your start in real estate, please?

I started in medical sales or medical consulting. I used to go into surgery with surgeons and assist with these heart procedures. It was interesting. I got paid well to do that, yet I realized I was not financially free. I had some single-family stuff that I’d done, and I wanted to become financially free through real estate. I thought as most people do, but I’m going to do this by buying individual houses and managing them myself. They’re having a property manager, so I started buying houses. I had become an accidental landlord. I had this property for years in another state and a family member had started partnering to buy some property in another state. We got to 4 or 5 houses.

I realized it was a lot of work. I had a chance to meet with a relative who said he was a multifamily guy that did a lot of apartment investing. He’s like, “Your whole plan to get 30 houses sounds like a lot of work. It doesn’t sound passive. Why don’t you do multifamily?” I said, “I’d love to, but I don’t have the money.” He said, “You can raise the money.” That’s where I learned about syndication. I know you guys talk about syndication, where you have managing partners that help find deals, operate them, and then they work to help passive investors to get a great deal. That’s what we do now. We help educate people and we’re doing deals. We have $150 million in multifamily assets, mostly in the Southeast US.

Just little steps with people that have gone ahead of you, can really be a good guide on how you want to get to where they are. Click To Tweet

That brings us to our next question here. You’re a higher earner and you believe in real estate. You’re investing in real estate, but you want to enjoy the economies of scale that exist within the larger multifamily assets and an associate who tells you about it. You realize this concept of syndication exists, or as we like to call it, real estate private equity. When you’re coming into this ecosystem, talk to us about your start. Do you start passively investing? Are you getting mentors? How are you getting involved? Talk to us about that journey.

That’s the power. They have mentors. You meet people that are a couple of steps ahead or, in my case, my cousin who told me he’s been doing this for many years. He’s high net worth and super knowledgeable. He said, “Read this book. Go to this conference. Check out this podcast.” I did everything he said. Some of these books and things talk about starting a meetup site. I ended up starting a local meetup in the Los Angeles area. I had partnered with someone who I had been going to their meetup, but theirs was more of a general real estate meetup. I was interested in multifamily. I went to them and said, “What if we start another meetup? I’ll do all the work. You show up. We’ll partner on it.”

Sure enough, it works great. We had 60 people at the first meeting. This was years ago. My first investor came from that meeting. I was there, and a guy came up and was like, “I’d invest in one of your deals.” I was surprised and I was like, “I don’t know how many deals, but let’s get coffee.” I showed him a sample deal, “This is what a deal would look like.” He’s like, “I’d be interested in investing $100,000 or something like that.” Somebody else I met at that same meeting was an operator who had a deal. I connected the two. I was able to get my first experience as a general partner in operating a multifamily deal. It’s amazing how little steps and people have gone ahead of you can be a good guide on how you want to get where you don’t where they are.

To break down this space a bit more, a lot of times, optics are a bit of an illusion. A lot of times, people see hundreds of millions of dollars of assets on their management, but they don’t realize that there are many different groups and individuals involved in a deal for a deal to go through. Same way as when a structure is built. There are so many different contractors and suppliers involved in a structure to be built. These syndicated investments syndicated these projects also involve many different groups.

At this time, now you were involved on the equity side. We know that this business is the deal and the equity part of it, the deal has got the acquisition side and the management side. Mainly it’s the deal and the equity. Did you realize early on that, “I want to be involved more on the equity side?”

There are two things you have to look at if somebody is interested in investing in real estate. Either people have time or they have money. If you don’t have money, then you’ve got to make the time. There are people that I know that work a lot. Some of these physicians made over $3 million a year, a couple of them I work closely with, but they were working 80 hours a week. They didn’t have the freedom of their time. For them, passive investing may be a better option because they’re able to leverage their time and not have to do the work on a project. For me, I had a good job. I was making over $200,000 a year. I was working probably 25 to 30 hours a week.

I was getting paid well and it became those golden handcuffs. You can’t leave because the job is good enough. You can live well, but it doesn’t get you where you want to go. To me, I’m curious. I love learning about new things. I was okay saying, “I’m going to continue to try to develop myself and learn. This is an area that I feel is a need. Why haven’t I heard about these types of investments with great returns? I find the returns that we’re getting, or that I heard about were way better than the stock market, without the volatility, especially with all the tax benefits and other things.” I started to look at it and say, “I’d love to be a part of helping people to do this as well.”

My job when I was a consultant was a sales type of role. I was helping to get people to use certain medical devices. When it comes to working in real estate investing, a lot of times, people either find deals, operate deals, or more on the side of working with investors, creating content, trying to explain things and make them more simple. That’s where I focused and realized there was a way to transition. Before COVID, I was going to leave my regular job, but I decided to hold on. In 2021, I left my job and I haven’t had a moment where I regretted it. I thought, “This has been the best thing ever.”

 

Watching you on the content you’ve created and listened to you speak, it sounds like you’ve done this for a lifetime. You’re a natural. Let me share a quick story with you, guys. A lot of time in this business, the equity side is somewhat dismissed. A portion of the whole GP profits is allocated to the equity side, but a lot of time, people who have deals put a lot of weight on the deal, the acquisition, and the management side of it. That’s important, but I don’t think that’s a fair divide because of my experience, because I was in real estate for a long time.

I was a general contractor, a builder of single-family and multifamily, and I had deals all the time. I had incredible deals that would come across my desk, and I didn’t have access to equity. I had access to that as well, but no equity. The need that I had for equity was so tremendous. At that time, I didn’t even understand what syndication was or the option of raising private capital and what have you. I understand and I have a lot of respect for people who are involved in the syndication process but dedicate some of their time or most of their time to raising capital investor relations 

I always say that raising capital is like an art. It’s special. In the relationship business, you got to be able to connect with people on a different level because they’re entrusting you with their hard-earned money. The first step is understanding it’s like an art.

It’s an art and a relationship business, but also, technology is an important part of it, as I’ve learned with CRMs and many other ways to create content and provide content.

Speaking about communicating with investors and it being an art and everything else, I wanted to discuss a topic. Here at CPI Capital, we have our investor communication culture. One of the things that we take pride in, and it’s an extremely important aspect, is investor communication, and then our culture is that we get back to our investors within about an hour. Maybe talk to us about what your investor culture is.

That’s a lot faster than I get back to. I try to get back as soon as I can, but usually, we tell investors within 1 or 2 business days because once you get a bunch of investors, it’s challenging to get back to folks or if they have a question. It can be a little tricky. When it comes to investing in any group, part of the vetting process is understanding what the values of the group are and who they are. Also, whether you’re on the active side, like for what we do, we present ourselves to investors. I always share our core values. I say that we like being conservative in the way we approach investments.

We’d rather say the returns are going to be 15% per year or 14% rather than 25% or something. We’d rather be more conservative. We know we can hopefully deliver on that. When we look at our projections and what we’re going for, we don’t want to be super rosy in the way that we think rents are going to keep going crazy. As far as rents are rising, I’m sure they’re probably rising in Canada as well. In the US, they’re going nuts. Some areas of the country are going up somewhere between 10% and 30% per year, which is insane. Core values are important. We also try to be transparent, particularly when things don’t go well in a deal because a deal is a mix of things. There are many different people involved and projects and things that some things are going to go hopefully better than expected.

Some things will go about as planned and some things won’t go as well. How do you communicate those things? There’s a friend of mine, Ken McElroy, who’s an author. He says delivering bad news early builds trust. The way we communicate with investors is to build high trust. That goes to the last core value. It is having this idea of a long-term partnership. We tell people like, “We’d love to do a deal with somebody. Obviously, you are getting to know somebody when you do deal.” Our hope is if someone invests $100,000 or whatever the amount is, in five years, they will have a great experience, both on the performance and the communication side. You can have a good performance, but if people don’t get back to you, and I love that you said one hour, I got to raise the bar here to try to communicate quicker with investors.

The experience is important. When you go to your favorite restaurant, you know the food is going to taste a certain way. You know the service is going to be on point and all this stuff is going to be there. A lot of people that haven’t done real estate private equity have no idea how this works. Our job is to help set the expectations for, “Here’s what’s going to happen. Here’s when we have a deal. Here’s what it’s going to look like,” and walk them through that process. If somebody is active, it’s important to make sure that, as a sponsor, you’re tee-ing things up and setting good and healthy expectations.

As a passive investor, you want to make sure that you understand the process and where a group is coming from. Sometimes, even speaking with other investors that have worked with that group before can be helpful as well. The communication side is equally as important as the performance. The performance is obviously important, but if you can’t reach somebody and days go by, even if it performs well, that’s not a good experience. You want everybody to have a great experience. A lot of ways we do that is by helping to have reasonable expectations on the front end.

Talking about stats and numbers an hour response to yours a day was fair and reasonable, but your stats over here is that 17% close on the calls you get on with is vetted accredited investors and that you beat Ava’s numbers on those close rates. Having said that, Ava wanted to mention that they’re raising capital for us here at CPI started months ago. Those stats, I believe, is at 12%. Maybe as time goes longer, the vetting process gets better by the time you get on calls.

It’s impressive. You’ve talked over 1,200 investors and 30 minutes each call. We’re going off some stats that we’ve seen you presenting on YouTube. It’s cool to see some of the stats. The average net worth was approximately $2 million. I liked that you asked the investors, “What’s your average net worth?” Seventeen percent conversion rate, amazing, who invested in the deal. You averaged about thirteen calls per week. One thing that you said was each one of those calls was equivalent to about $12,000 in capital raised.

You guys did your homework. Well done on that. The data is interesting. When you get down into it, it is a numbers game. We continually learn, but obviously, we’re continuing to try to get better at it. It’s all about the experience, but when you keep track of stuff, you have calls. I have a little spreadsheet that I have that has all the questions that I ask investors. If somebody is interested, they can reach out and I’m happy to share that with any people that want to see that. I go through you like, “What’s your net worth? What are your goals? What are the things here?” People tell you what it is because you want to see, “Is this a good fit?”

You want to understand where their goals are coming from. One of the things that help me is when I want to get on the phone, I try to figure out who this person is. Are they somebody who’s done ten private equity deals? Are they familiar with this? Is this somebody who’s got a high net worth or a doctor, and they’ve never even invested in real estate at all? That’s going to be a different conversation. I have to explain a lot more. Ask a question like, “What’s your work background? What’s your real estate or other investing experience?” Those questions will give a lot of information as far as who you’re talking to.

The biggest thing about sales is being able to ask good questions and understand who you’re talking to. We talked about this process. We try to get it teed up. When we have a deal, people know what to expect, and they’re ready to go. We have had deals and we raised $8 million in 24 hours. A couple of years ago, I had some partners and we were getting a lot of interest. It was after COVID and everything. It was right after when deals were starting to come back. That can happen. It is an art. There’s a data side, which is the science of it, but there’s an art to how you do it.

It’s important to be creative and try to reach people. That’s why we do educational stuff like this, but also because all of us believe in what we’re doing. We believe we’re helping people. If people get involved with this type of investment, their lives will be better off. What you guys are doing at CPI, you’re helping people on their way to becoming financially free. Many people are stuck in Wall Street or other types of financial products that are not going to serve them, particularly if there is some recession.

 

Bronson, I have a question for you. With the many communications that you have had with investors, what has been the number one reason an investor hasn’t invested? You have a 17% closing rate. What about the other 83%? Why didn’t they invest, do you think? 

It’s interesting. My background is sales. I’ve done sales for a long time. Nobody wants to be sold, show up, be at a car lot, and say, “You look great in this nice 1972 Buick.” You don’t want to have that experience where you’re being sold. We look at it a little bit after the fact and say, “How do we do on this particular current deal? How many people invest it?” We look back at that. When it comes down to it, it’s the weirdest thing when you raise money. This is behind the curtain for somebody to more passive. You want to have the impression that we’ve got plenty of money.

We don’t need your money or anybody’s money. Yet, it’s great. I feel that. We can raise enough money. We raised about $6 million in 2021 and we’re trying to do a bunch more deals in 2022. If you have a vibe, we don’t need the money from people. It’s apparent. We almost create a scarcity of like, “Our deals do fill up pretty quickly.” We have one deal we don’t even get to offer to investors because we’ve got a couple of large investors that came in and filled the whole thing. That happens. It’s between myself or partners or whatever. I try to look at it like you’re not out hunting.

Hunting is you go out, “I’m going to go out and go find an investor or whatever.” You’re on the call and you narrow them and get them into a deal or get them into whatever. Farming is like this. We’re doing educational content and we’re putting things out there. People invest in people they know, like, and trust. You guys are creating this awesome presentation for creative Canadian investors and passive income, which adds so much value. As you do that, people are going to say, “I trust Ava and August. They seem like they are good people and their background or whatever.” I’ve seen that in my own life. I’ve invested with people I’d never even met because I’ve heard them on a podcast or been involved in that.

You’ll see that happen. It’s the idea of continually farming. When you have a deal, you put it out there. I put it out there once, or I put it out maybe once and then a reminder. I don’t do anything else. I don’t call any investors. I don’t do any follow-up besides, “This is where we’re at.” I have a limited list of people that are on that investor list. People can get set up on that if they reach out and they want to join our club. There’s a big difference. As an investor, it comes across that if anybody is desperate or needs the money, that’s where having partners can be helpful. If I have trouble raising the money, then hopefully, one of my other partners can raise the money.

I can raise more money, and then maybe they’ll have a little more space in that way. I don’t know if that makes sense. There’s some nuance there, but again, everybody wants to invest with people that they know, like, and trust. Nobody wants to be sold. At the end of the call, I didn’t know if they were going to invest right away. I try to give them a good expectation of, “This is who we are. These are our values. Is there potentially a fit there?” When we have a deal, this is generally what it looks like.

Most of your work is being done front end, where you make the introduction, you talk about past deals, you’ve done your track record, what a deal looks like, have a great understanding of who the investor is and for them to understand you. By the time that deal comes in, you’re not getting on calls, calling all these different people on your thing, multiple times, and what have you.

You send the deal out and then they don’t commit. You’re not saying, “We got to do it.”

The biggest thing about sales is being able to ask good questions and understand who you're talking to. Click To Tweet

Was it that from early on? I’ll get into our situation a bit about that.

I’ll tell you my first deal. I was a medical sales guy. People knew me as that. That’s what people know me as, I sell devices. For years, I’ve been doing this. I did well at it. In my first deal, I was having these conversations. I’m still trying to tee investors up, but I had 62 calls or meetings with friends and family, talking about an investment, what this would look like, getting information from them, or getting all my deals list. When we finally had a deal, none of those investors invested. It was that guy that I mentioned in the meetup that saw me in that context and I fit there.

It’s tricky, challenging, and hard to get going. Since then, we’ve had a number of those people that I’ve talked with that have invested. The good thing is you have to look at it. You have to have a long-term view of this. Your timing is not everybody else’s timing just because you want to do it. Again, what we’re doing, learning, and what we’re about is such a valuable skill. You guys are more active. You’re operating, finding money, and doing deals is an active thing because it teaches you also about the passive investing side. Even if you do it for a while and then you go past it, it’s great.

We should all aspire to be passive investors. The process takes time to get into it because people have to see you as someone who is in authority or somebody who has experience in that way. If your car mechanic said, “I’ve got this great investment for you,” and it’s something to do with cryptocurrency. It wouldn’t fit. I’d be like, “That doesn’t make sense.” As you tell your story, whether through an email campaign, which I recommend everybody does, get on MailChimp or ActiveCampaign, and start sending out updates, “I’m going to these conferences. I’m learning this. I’m investing in this.” It tells the story of what you’re doing. A lot of people have no idea. You’re a secret agent. When people go to raise money, and then they can’t raise money, they’re like, “It doesn’t fit.” It’s like the mechanic doing real estate. “I thought you were a mechanic. I didn’t know you were doing this.”

I can share a story with us. We both had real estate backgrounds, but we left our careers to focus 100% on real estate, private equity and building CPI. We noticed right away that we picked up some traction. A lot of people signed up for our content. We have over 1,500 people that were part of our database. They were opening our emails. We were getting a 40%. We still do it. It is dropped a bit because now we have over 2,200 people part of our database. It’s a 40% email open rate, but the first deal that we had was a bit of a humbling experience because we felt like, “I can see who’s opening my email. This is not a competition or people trying to learn what we’re doing. These are busy professionals that are opening our email 7, 8, or 10 times, but when the time came to make those investments.”

It wasn’t as easy as a click of a button and say, “Fill out,” and having millions of dollars raised.

From our 1st deal to the 2nd deal, the number of investors who came on and then again from the 2nd to go to the 3rd deal, the projections are there. That trajectory is great. If you can keep it on the same line, it will be wonderful. Maybe this is more of an active side of the question for people who are somewhat starting out, creating a lot of content, and half closed on some deals. What they’re noticing is that the conversion of their community to actual investors is not that high. I know this might be a difficult question to answer, but is it because something along the line might be broken or is it because this is just the normal way for people want to see progress? They want to see you possibly going through a full cycle of a deal, which we haven’t. Tell us about your experience in this.

People have different things they look for. I was first getting on calls and how I got from $100,000 to a deal. I found a partner about six months after that. We raised $15 million together over the next eighteen months. I got on a lot of calls with investors. We average 13 or 15 calls a week. At the beginning, I didn’t know what I was doing. I was like, “How’s it going?” You stumble through it. After a while, you get comfortable talking with people. You figure out what they’re looking for, what the right questions are, and things like that.

 

The amazing thing about all this is a lot of people think when it comes to real estate and private equity that you have to do everything yourself. You’ve got to be the one that finds the deal and does all the diligence. You’ve got to raise the money, and then you’ve got to operate. You got to do all this. For me, how I’ve gotten around that, one of my business partners who works on almost e deal with us, he has over 10,000 units and over 25 years of experience doing asset management. There’s not an issue. My experience is not as relevant as his experience because I don’t operate the properties. I can show in Atlanta how we’ve had multiple deals and phenomenal results out of the eight deals we’ve exited the last couple of years are between 17% return per year and 43% return per year, which is amazing.

Some of that’s being in the right markets and being in Atlanta. The biggest shift I had to make was shifting from I have to do this myself. I’ve got to be the whole team. I can have team members that do other things. Now I’m involved. I’m not the person that finds the deal, but I’m a part of the asset management team. I do my own due diligence. I invest my own capital. I’m passive as well to a significant level of what I can afford to do. I’m a part of the asset management team. I raise capital and then I work with investors afterwards, which is considered investor relations. It is a team sport. You don’t have to do everything.

For people that try to do everything, it can be exhausting. As soon as in a couple, you’ll find one will focus on asset management, finding deals, focus on more of the investor side, or they’ll partner and say, “We’re good at creating content and connecting with investors. We are also investors, so we find other good partners.” People appreciate that as well. Being able to present where you’re coming from and also realizing the value of partnership and networking, you don’t have to do everything. To go back to what you said, this is not something that’s super easy to do. It’s not like you flip a switch, and all of a sudden, you raise $20 million.

It’s hard work, a grind, and creative. You’re looking for solutions, and it’s not easy. It’s not that it can’t be done. Jim Rohn was a famous motivational speaker. He said, “If it’s easy, it means it can be done. If it’s hard, it means you can’t do it.” That definition is easy. You have to put in the work, the time, and the effort because you can do it. It’s something you have to learn, and you can learn to do it.

It’s the advice my grandma always gave to my mom when she complained about school. She was like, “If it was easy, everybody would be doctors and lawyers.” It’s an important point that you bring on about this business being a team sport, focusing on what you’re great at, and having partners who are focused on other aspects of the business. For example, asset management. The way I view real estate private equity or syndication business is it’s a pie and that pie is divided into three pieces. One piece is the equity piece. One piece is the acquisition, the deal piece. The other piece is the management value add renovation that needs to be done. If you have partners that have a focus and background in each one of these pieces of the pie, then you can have a superstar team.

If you’re creating SPB for each deal or the syndicated investment projects, these are probably your specific investments. They’re not a fund where it continuously raises capital and continuously buys assets. In this case, the long way to coming to my question. Suppose our job is finding the best possible deals for our investors and being astute fund managers or investment managers, as far as being diversified in multiple regions. How do we manage to have multiple partners on the operation and management side within multiple regions? You’re in partners with multiple operating partners who act as your boots on the ground or asset managers for your deals in multiple regions. How do you balance that? Is that a strategy you utilize? We utilize that strategy. Talk to us about that a bit.

It’s challenging. When you start, you bring up a good point. If you’re working with partners, they’re in different areas. We’ve got deals in Oklahoma City, Georgia, Florida, Alabama, and Arkansas, and some of the different partners on those deals. How do you manage all that? How do you keep connected? In reality, the challenge is when you are involved, but you’re not maybe the primary asset manager, you are sometimes at the mercy of who’s the person on the boots on the ground.

My partner in Florida is at the property every couple of weeks right now. He’s doing a lot of stuff. We have a couple of properties that we’re working on. It’s great to have somebody who does that, but the downside of that, at least for me, and I’m getting to a place now where it’s I’m thinking more about this, that as we can raise more money, it makes more sense to try to bring someone in the house, to have more of an in-house asset manager, or have a partner that can do that more with Bronson Equity, who can be that person for us.

It would give us more control. Maybe you have step-in rights, and if a deal doesn’t go well, you bring enough money. You can step in and take over because otherwise, investors are at the mercy of whoever is operating the deal. It is a challenge, but it comes down to trying to get to know people. Reputation is huge. I do a background check on every person that I partner with who is part of the partnership on the operations level.

Those things are important because, obviously, they give you a greater comfort level. I have a saying or belief that you don’t know how it is to work with someone until you’ve done a deal with them because you can feel like, “We’re going to be great, whatever,” and you get a deal and you find out, “They don’t communicate well. They cut corners in these areas.” You get to see someone’s character, who they are, and how they respond to you in a deal. There are people I would not do a deal again with, and there are people I’d be like, “I’ll do deals with these guys all day long.”

It’s getting to be more of a ladder where I’m like, “I found some good partners. It’s a win-win. Let’s keep doing this.” In the beginning, it’s hard because you’re trying to get good access to deal flow. You’re trying to develop your network. There can be some great deals, but you also find partners and you’re like,” On these areas, we match up, but maybe these areas over here, we don’t match up as well.”

It’s a great setup for my next question. Final question, unless Ava has any more questions before going through the next segment of our show. You touched on this a bit. You’re initially involved more on the equity side, some management, and some investor relations. Obviously, you’re underwriting the deals that are coming to you for the benefit of your investors. You’re also looking to bring in an in-house asset manager who oversees the operating partner, the property manager who can step and has the capability of even stepping into the management side of the property if things go awry. Is the plans for Bronson Equity to become an operating partner, or is your firm focused on being in the space you are on where you’re partnering with operating partners? 

We haven’t fully decided exactly. It depends on what that looks like. Right now, we’re raising somewhere between $1.5 million and $2.5 million per deal consistently. If we got to where we could raise $5 million per deal, we might say, “That’s a pretty big check. Could we do our own deals of maybe a little smaller size? What would that look like to be able to do that?” It also depends on who the potential partner would be. Would this person be an employee or would they be someone who is more of a partner that’s more of an equity partner? I’d be open to both. You have to look at it and say, “We’re getting pretty good returns and performance. Everybody is happy.”

I’m okay getting a little less as long as the performance is there. I love being able to connect with people, doing calls, and creating content. I enjoy that. If I’m not able to do that, then I’ll have to look at it and see how I am going to structure this. I don’t want it to be that I’m having to do flying to Jacksonville or flying these areas and doing it all myself. I do go out, and I’m a part of that stuff, but it’s a different level. If you’re the primary asset manager, you’re the one who’s in the mud and getting in there with each deal. That’s a good question. We’ll have to do a follow-up on that in the future. In general, the larger groups get, it makes more sense to bring a lot of it in-house. We talked about investor experience. You can tailor the experience of you have much more control over the investment as well as the investor experience as you go through it.

Like that analogy I made, the bigger piece of the pie, there’s more of the GP profits, fees, and promote. I was excited to have Bronson on.

Next segment, Ten Championship Rounds to Financial Freedom. First question. Who is the most influential person in your life?

I’d say my dad. My dad has been super inspirational. He’s an amazing guy, strong in his faith, beliefs, and also his work ethic. I learned so much about working hard from him.

Bronson, what’s the number one book you’d recommend?

I read a lot, but this is more of a personal development book. It’s called The Gifts of Imperfection by Brené Brown. It talks about owning your story, overcoming shame, living out of a wholehearted place, and being grateful. I love the book. It’s a short book and 150 pages. It’s a great book.

If you had the opportunity to travel back in time, what advice would you give your younger self? 

I would say, “Be kind to yourself.” I was hard on myself for a lot of years, saying, “Why am I not further along or doing more? Relax, be yourself, and have fun.”

What is the best investment you’ve ever made? 

I’m a parent, and being a parent to my daughter is the best investment. It’s having her and spending time with her. I’m getting ready to surprise her to go to Legoland. We live in Southern California, which is her favorite place on Earth. We’re going to go there for a holiday. The time I spend with is the best investment I could make.

What’s the worst investment you’ve ever made, and what lessons did you learn from it? 

If you're intuitive and you learn, it's all education. It doesn't have to come from books. Click To Tweet

I had a deal when my net worth was not as nearly as high as it is now. I was about 1/3 of my net worth. I lost $70,000 in one day on an options trading strategy involving iron condors and other jungle creatures. What I learned about myself in that is that I’m not a technical guy who works like an engineer type, working the thing and moving the formula. That’s not me. I learned that that was probably not the best fit for me. It was an expensive lesson, but I learned the lessons. It worked in my life.

How much would you need in the bank to retire now? What’s your number? 

My big why is fighting human trafficking in the world. There are 20 million to 40 million human slaves. I have a big number. I want to keep working towards it. This part of my life is more the saving and accumulating side. There’ll be a point where it would be more of the giving side. I want to start doing that. I’m doing that now and I’m finding ways. As it grows, I want to find ways to deploy more of it. It’s a pretty lofty number. It’s not about yachts and Mai Tais for me. It’s more about making a difference in the world.

If you could have dinner with someone dead or alive, who would it be? 

I’d have dinner with Jesus. I am a person of faith. Not from a religious standpoint, but to relate, sitting down, and shooting the breeze. That would be amazing.

It’s the most common answer. 

If you weren’t doing what you’re doing now, what would you be doing now? 

I love traveling. I’ve been to 37 countries. I love to travel more, be around the world, spend a couple of months in Tuscany, rent a car, and go all the little towns. Travel and learn from people. I’d like to write a book in the near future, but spend more time learning from other people of other cultures.

 

Book smarts or street smarts?

If I was going to choose one, I would choose street smarts. A lot of people are smart, but if they don’t have intuition, it limits them. Robert Kiyosaki talks about this in his book. In a lot of his books, he talks about he wrote the book Rich Dad Poor Dad. He talks about why A students work for C students. Somebody who’s a star or book smart person may go work for somebody who’s not as smart. Their intelligence may not be as high, but they found a way to make it work. That’s why you find a lot of people that are millionaires and billionaires that never finished high school or didn’t finish college. At the end of the day, if you’re intuitive and you learn, it’s all education, but it doesn’t have to come from books.

Last question, Bronson. If you had $1 million cash and you had to make one investment now, what would it be?

I would probably put it all into a multifamily deal. I also participate in what I invest in every deal. It’s the best thing to do.

Bronson, what’s the best way people can reach you?

I wrote this special report, the Single Best Investing Strategy during and after a pandemic. It’s 24 color pages that talk about some of the unfair advantages of multifamily investing. It’s a free download at BronsonEquity.com, and it’ll pop up. You can download it. You can shoot me an email at Bronson@BronsonEquity.com.

Thank you so much for being our guest.

It was so fun. Thanks, guys. I appreciate what you’re doing. I love Canada. Well done.

Thank you so much.

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