Do you feel like you some time gets in your own way when it comes to enjoying below market value properties? If you find that you are regularly making excuses for the common hurdles you may face, then this is likely the case.
What is important to note is you are not alone!
It is part mentality and part execution - but when you get it right, the reward is great and you'll find the gains compound.
So, do you ever find yourself saying any of the following?
I do not have the funds
I have never been to an auction before
I do not have the knowledge to view the properties and understand the legal pack
I scared of the speed that the purchase must happen within
I do not have the funds
Before I started TMG I was afraid that would not be able to buy one property let alone having 5 HMO’s with 3 single lets to date. Please do not get me wrong, money doesn’t grow on trees but when you have limited resources you have to resourceful. I had one bit of advice that I would like to pass on, tell everyone you know what you are doing. By explaining to others and them telling their network this allows your network to grow exponential. Who knows what contacts this could bring to you?
At the start you have to avoid expenses such as offices, wages, delegating all tasks but also be mindful of your time. Whilst I was in my London events ‘JOB’ I did (and continue) to outsource the finding of properties as I could not spend the time on this task which is the foundation to TMG. You will have to balance spending money with the use of your time very carefully. Then as you grow you out source tasks so you can look after the larger revenue activities.
Also remember from my October 2019 blog that not capital is money – look at the skills and knowledge you have.
At the start you will be the centre of your company. So as you start ensure that you keep processes written down, so when you are able to delegate to others you already have the steps listed down (this can be a simple A4 bullet point list). This will allow you to replicate what you do and also help to sell the business as you are removed from the centre of the business.
Examples of those who are well knownÂ
MailChimp: In the year 2000, co-founder/CEO Ben Chestnut was running a design consulting business and had a stream of clients who wanted email newsletters created. The only problem was that he hated designing them. So, to spare his team the tedium, he decided to build a tool that would streamline the process and MailChimp, a $400M business, was born.
ShutterStock: Jon Oringer was a professional software developer and an amateur photographer. He combined this set of skills and used 30,000 photos from his personal photo library to start a stock photo service that is currently worth $2 billion dollars. His capital efficiency paid off and ultimately turned him into a truly self-made billionaire.
Spanx: Shark Tank judge Sara Blakely is the most famous founder on this list, having turned a $5,000 investment into an Oprah-approved approved garment that generates $400M in revenue annually. Her fashion sense earned her a following, but her keen appreciation of the principles of capital efficiency earned Blakely a billionaire status.
Tough Mudder: Track & field entrepreneur Will Dean turned $7,000 in savings into a company with over $100 million dollars in annual revenue. The secret was pre-selling registrations to races and then using those funds as working capital to construct the electrified obstacle courses that have made Tough Mudder a global phenomenon.
Wayfair: The home goods ecommerce company was profitable from its first month of operation and grew profitably for a decade until they ultimately raised a Series A — worth $165 million dollars — shortly before going public. The company is currently worth $6 billion dollars and because they suffered little dilution, the founders are worth a billion dollars each!
From https://hackernoon.com/50-big-companies-that-started-with-little-or-no-money-4ef1b68aac25
I have never been to an auction before
The only way to find out what a new place or experience will be like is to visit the new place or to experience it. So visiting an auction is no difference. You can visit an auction house even if do not intent to purchase anything on the day. Thus will allow you to get a feel for the registration process, experience what happens in the room when the auction is in full swing. You may also be able to learn from outer bidders who you see as good budders and those who make mistakes and get carried away with the bidding! This initial visit and others if you wish to feel more settled in this new environment will ensure you are clear headed when you do intent on purchasing a property.
OR you can visit an online auction so that you can watch the bidding process without being in the auction room, and this may remove some of the apprehension you have about being in the auction room.
I do not have the knowledge to view the properties and understand the legal pack
Check out my January 2020 blog where I touch on what you need to do prior to an auction such as carrying out searches and conveyancing steps, local demand research and checking the property information. Depending on your experience you may need to visit the property yourself or with a builder and you may need to get assistance with the legal pack. This may not be your normal solicitor as working with a solicitor who has experience with auction purchases may help with unforeseen delays. Remember auction benefits are the speed of a sale so you need those around you who add to the speed.
You must have the mindset that you cannot know everything and be an expert in all fields so surround yourself with those who do hold the expertise. Ask the builders for their quote and thoughts on the property, call the estate agents and ask what they feel the local demand is and rental levels and ask a solicitor to look over the legal pack. No one has built a company completely in insolation.
I scared of the speed that the purchase must happen within
Simple … do not see this as an issue but as a benefit and to remove the fear ensure you do you research prior to the sale. If you ensure you visit an auction before you intend to buy so you know what the registration process and live auction day experience will be like then this will remove the apprehension on the day.
Feeling a little stuck in the mud?
It's essential to get yourself in the right frame of mind to start achieving the results you want. Once you are aware of these common drains on your time, it becomes so much easier to overcome them.
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