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Money-Raising Resources

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Hey there deal makers,

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Welcome to the Better Business Brief, where I share takeaways from:

• running a business I’m building to sell for millions
• my consulting with business owners building to sell for millions
• tips and tricks you can use to do the same

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In the pursuit of building a private equity fund, we are raising money. We are looking to institutional investors, high net-worth individuals, family offices, and other more established funds in order to raise the money to go buy businesses. Along this journey, I’ve discovered some resources that can be very helpful to those that are out there looking to raise money for something. These exist across lots of different capital needs - whether you are raising money for a real estate deal syndication, a private equity fund, or a startup, there are ways to get connected with the types of people that fund these opportunities.

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Raising money is something that (transparently) I haven’t done before this. My role in the fund is less revolved around the capital raising side, and my partners all have much more experience with it than I do, but I’ve been able to learn a great deal in a short time from them, and many others who have stepped in to help and to mentor who have raised capital many times.

With that being said, here are my favorite 3 resources I’ve found and used so far:

Credit to my friend Troy for introducing me to this one. This is a website where you can make posts about specific deals you are looking to raise money for. For example, if I wanted to buy a painting business for $500k, and I didn’t have the capital to buy it, I could make a post about the deal and seek investors directly from the post. Then, investors come to you if they like the deal and want to explore funding it. Pretty cool! I’ve noticed that the dynamic between someone reaching out to you about an opportunity you have vs. you reaching out to them is a night and day difference, so the fact that this puts it on the investor to reach out to you if interested was a huge draw for me. I suggest taking advantage of that positioning, and aiming to create an environment where investors are pitching you. The only thing I don’t like about this site is that it has a fairly high monthly price for membership, however, you can keep your account free by making consistent posts (which you should be if that’s your goal).
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The longer you are in business, the more you realize that money moves in mysterious and unknown ways. There are many, many examples of undercover, back channel types of brokering deals that exist across all industries, and capital raising is no exception. Recently, I was introduced to a guy who has a whole firm based around introducing investors to fund managers like me in the hopes that they will fund our projects. The reason he does this is that he makes a success fee if he’s able to place an investor. These success fees can range anywhere from 1-4% of capital raised, and in our case, it’s somewhere in the middle. Within the first week of being signed with him, he’d made over 6 introductions to established investors with plans to bring more our way. You have to know these exist to find them, but once you do, you can find them. Look to find ones that are well connected. The more well connected they are, the more likely they will be to introduce you to the right people. The obvious downside to going this route is that you have to pay a finders fee for the capital, which can cut into your bottom line. I wouldn’t recommend signing with one that has higher than about 2.5% fees.

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I found this because our capital raising agent actually partners with them, aside from the investors in his own network. Check out their website - pretty interesting. They help connect you with all types of investors; real-estate, business acquisitions, etc. They help with both raising equity and raising debt. Personally, we lean way more towards the raising equity side, but it’s cool that they have both options. The real draw of this site is that like the capital raising agencies, they make introductions directly if you sign up with them. The dynamic of getting referred to someone rather than being reached out to cold by someone is always better. The downside of course is that there are costs for this service as well. One cool option they have is that you can have one of their in-house virtual assistants who is trained in the communications for these things do outreach and help set appointments for you. I’d recommend going into working with a service like this with all your ducks in a row. You need your pitch deck solid, your numbers at the ready, and you need to have battle-tested your ideas and be ready to answer questions about them. Then again, this goes for all of the above.

Anyway, those 3 have been huge for me so far. The thing I love about business is I’m always finding more resources like this, and new ways to make what I’m trying to do easier.

As I bring this edition to a close, I’ll leave you with a piece of homework. Check one of these out this week if you are looking to raise capital for a project. See what it does for you. You’ll thank yourself later.

In the meantime, if you’ve been following along, and are curious how the conversation goes when we do talk to these investors, I made a video recently about what things we cover and hit on in our pitch. Check it out here: https://youtu.be/fyf5H1becY0​

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Be great. Keeping growing and aspiring. And as always: I hope you got something from this.

If you did, share it with a friend who may too, as this is the best way for me to grow it and make this better.

They can even sign up here :)

Happy value-building to all of you!

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See you next time for Better Business Brief,

-Brody