BY LANCE EDWARDS— When locating private monies for your real estate deals, there are the four key elements of being successful: Predisposed investors, control, low risk and high return. However, there is another element to making your hunt for finding investors successful. This fifth component is called the strategy of pre-eminence.
Think of the strategy of pre-eminence as you would The Golden Rule: “Do unto others as you would have them do unto you.” It is really that simple. You take a pre-eminent position and treat every client as you would like to be treated. This means that you have a vested interest in what type of deal they are looking for.
This strategy begins with being sure to refer to your investors as “clients” as opposed to “customers”. Client denotes someone you are going to look after in the long run while customer denotes a one-time transaction. Client is a long-term relationship.
Your private money sources are your clients. You are creating investment products for them. They expect to receive benefit from that. Because you want to have a long-term relationship with them, you treat them as a client.
Think of it this way: you are a customer at the chain jewelry store. You are just a nameless face among thousands there. No one there has a vested interest in finding out what your needs are and what they can do for you. However, if you go to your local jeweler, they will treat you as a client. They will get to know you on a personal basis and work for your repeat business.
This means that you look after them; you think like they would. You try to put yourself in your client’s shoes and look out for his or her best interest. Honesty is always the best policy. If you fudge on giving the details of a multifamily property to your potential investor, not only do you risk losing them but you risk destroying your reputation that you have built thus far.
Remember, referrals are the backbone of your business. You cannot build up your list of credible and trustworthy references if you develop a reputation for not being an honest person to deal with.
Your ability to establish a relationship of trust, reliability and integrity is the foundation for a relationship that will be mutually beneficial in the long run. The strategy of pre-eminence opens the door for you to garner stellar word-of-mouth referrals from your clients.