What To Do When Deals Don’t Pencil

The market has been difficult for all of 2024…?

The deal flow in most markets went down by 85%...

Borrowing money became more expensive…

Investors got skeptical, resulting in a huge shortage in capital…

All of this made it extremely hard to keep doing deals and stay in the game.

So, if you’re feeling like you're missing out on deals and it’s messing with your mind…

Here’s my playbook that we implemented internally (and with our community) to tackle these issues…

#1 Realize these are the moments when the best deals are done.?

This is a critical moment in your career.

Because when deal transactions are down, it means people are only selling if they're distressed.

And when you buy distressed deals, the upside is MASSIVE.

=> So you have to stay the course to actually find and capitalize on these opportunities.

#2 If you miss out on a deal, get as much information as you can.?

If you bid on a deal and lose it, your job doesn’t end there…

Keep texting the broker to know if the deal’s still moving forward…

Because sometimes, the buyer doesn’t know what they’re doing and they don’t end up closing…

…especially in today’s climate.

=> So if you’re constantly staying in touch with the broker, it’ll show that you're still in the game and they might direct that deal to you.

But if the deal ends up closing, here’s what you should do…

#3 Ask the broker who else bid on that deal.

This will give you a sense of who's participating in the market…

=> So if you want to buy similar deals, you can start to create a list of potential sellers that you can buy other deals from…

…or buyers that you can later sell a deal that you own too.

#4 Track the deals you lose in Excel.

Since you bid on those deals, you will have access to the P&L.

You would know more than most people what the true cap rate and valuation of that deal were internally…

=> So when things change, you’ll already have a lot of due diligence done to make a good offer…

…and increase your chances of winning it this time.

#5 Keep up with the market dynamics.

The market is changing rapidly due to the changes in interest rates…

So if you're playing the game with outdated data and putting an offer based on that…

…you might miss on every single deal until things normalize.

Guess what? When things do normalize, all the great deals are gonna be taken at that time.

So if you want to do deals right now…

=> Stay abreast of the market dynamics and understand how the changes in the economy are going to impact the valuations.

#6 Broaden your horizons by partnering with people in other markets.

Now we aren't implementing this, but I’ve seen a lot of people in our community doing it with great success…

I’ll give you a perfect example…

One of our coaches, Ben Fraser, has a group with a very robust background in the non-performing note space.

Not only has he raised more than $100M himself, but his group has raised billions of dollars…

And as our coach, he's able to access people as they come to our community…

…and has actually partnered with several of them in their various niches…

So if their market dries up…

They can pivot Co-GP or create a fund of funds with other groups, allowing them to 10x their deal flow.

That means they’re going to win no matter what.

That’s the power of being a part of a community that’s filled with entrepreneurs eager to partner and help each other…

What community are you currently a part of? Share your experience below!