How to Scale Your Syndication Business
Michael Blank, the founder of Nighthawk Equity, was one of the featured speakers at this year’s Best Ever Conference. In his presentation, he explained how a thought leadership platform is the key to raising more capital from passive investors and ultimately scaling your syndication business.
What is a thought leadership platform?
A thought leadership platform offers unique information, insights, and ideas that will position the owner of the platform as a credible and recognized expert in a specific business niche.
A thought leadership platform may take many different forms. Examples that other investors and we have found successful are:
- Start a YouTube channel – interviewing real estate investors and entrepreneurs and/or providing daily/weekly/monthly insights.
- Write a book and self-publish in the Amazon store.
- Create an interview-based podcast and post to iTunes, Soundcloud, and other popular podcast business thought leadership platforms.
- Create a blog, posting to your own personal site, and leveraging existing platforms like social media sites, LinkedIn, BiggerPockets, etc.
- Start an in-person meetup group in your local market.
- Host an annual real estate conference.
- Create a weekly or monthly newsletter sent via email or mail.
- Start an exclusive investor club.
What will a thought leadership platform achieve?
The reason why a thought leadership platform allows you to scale your syndication business is that it automates the money-raising process. Without a thought leadership platform, you need to manually raise capital from family, friends, and others in your circle of influence, one person at a time. With a thought leadership platform, you will build new friendships and business relationships and maintain and grow existing ones. You will stay top-of-mind of prospective passive investors and other real estate entrepreneurs because you are constantly providing valuable, free information. Essentially, you will continuously and automatically network with people on a global level – even while you are asleep.
A thought leadership platform will allow you to attract the right passive investor. I will go into this in more detail in the next section of this blog. But high level, you can attract your “target investor” based on the type of content you create with your thought leadership platform.
Since a thought leadership platform allows you to automatically attract the right investor, you will increase the amount of money you can raise. The more money you raise, the bigger deals you can do. The bigger the deals, the more revenue you can reinvest into your thought leadership platform to attract more investors. Consequently, a thought leadership platform is a key to effortlessly scaling your syndication business and serving your passive investors.
The three pillars of a thought leadership platform
Now that you know the benefits of the thought leadership platform, what are the best practices to create and grow one? Michael finds that there are three pillars to a successful thought leadership platform.
1. Attract the right investor
To attract the “right” audience you have to identify your ideal potential investor. Be specific here. What is their demographic (age, occupation, location, income, etc.)? What are their interests?
Step one is attracting the right investor. The second part is capturing their contact information. You need to know who they are and how to reach them in order to convert them to an investor. The best way to capture their contact information is to offer them a “lead magnet” in return for their email address. For example, Michael’s lead magnet on his website is the “Nighthawk Investor Club.” When someone provides their contact information, they receive membership in an exclusive club of other passive investors.
The point is that people aren’t just going to proactively provide you with their contact information. They need an incentive, which is the purpose of the lead magnet.
2. Develop the relationship
Once someone has provided you with their contact information, you need to develop the relationship. They most likely aren’t going to invest immediately after signing up for your lead magnet. You’ll first need to earn their trust. This is accomplished by serving them valuable free content that educates them about your investment strategy. The more service you provide through free educational content, the more they will trust you and perceive you as a credible, expert commercial real estate investor.
Lead them on their investing journey with continuous content. Take them from someone with minimal to no knowledge of your investment strategy to having the confidence to invest in their first deal with you.
3. Scale your business
After attracting the right investor and developing the relationship, the investor will trust you enough and have enough confidence in their understanding of your investment model to invest in a deal. But this isn’t the end of the strategy. As you convert more and more leads into actual investors, your company will generate more and more revenue.
To benefit the most from a thought leadership platform, you need to reinvest a portion of your revenue back into your brand. Hire team members to help you manage and grow the thought leadership platform. Create additional platforms. Improve the quality of your current thought leadership platforms by hiring a graphic designer or podcast or video editor. Invest in paid advertising on social media to attract more leads. Revamp your website. Etc.
Overall, a thought leadership platform is a great way to efficiently scale your syndication business. The strategy is to attract the right investors with a lead magnet and develop the relationship through providing continuous valuable content. Then, as more leads are converted to investors, reinvest a portion of the revenue back into the thought leadership platform to scale even more.
Disclaimer: The views and opinions expressed in this blog post are provided for informational purposes only, and should not be construed as an offer to buy or sell any securities or to make or consider any investment or course of action.