The majority of real estate projects depend on outside funding in order to come to fruition. As a result, it’s very likely that your level of success is going to be directly proportional to your ability to raise funds for your projects. Real estate is a very capital intensive undertaking and the expenses involved in getting a project off of the ground are only increasing, with rising material, energy and labor costs following a very high uptrend. This is why you want to make sure that you’re as visible and attractive to investors as possible, creating positive fundraising enablement for your business and your project as a whole.
What is Real Estate Fundraising Enablement
Strictly speaking, real estate fundraising enablement is anything that makes it easier and more likely for you to raise investment to fund the progression of your real estate projects. Due to this, it can take many forms, such as technologies, processes and the internal culture of your business.
As a result, real estate fundraising enablement is something that can be improved by continually eliminating common roadblocks to achieving your investment goals. Some common examples of fundraising enablement can be seen below.
- Digital contract signing to speed up the deal process.
- Highlighting ideal investor profiles.
- Using marketing techniques to push your project.
- Facilitation of digital payments for investments.
The Best Ways to Improve Your Fundraising Enablement
There are a number of methods which you can use to win more fundraising and improve your operations. Generally, winning investment is the same as winning any other kind of deal, it’s just the specifics that are different, although the market conditions in recent times have made fundraising difficult for some projects. As such, getting your fundraising enablement right will require a multifaceted approach, with many small and big things you can do which will all result in positive changes for your business.
Make Use of Software
There are now a number of software solutions on the market that make real estate fundraising enablement much easier. Some of these systems come as a full suite with a range of tools to help you target and win the right investment. For example, some software packages feature analytics tools that can help you to get statistics on your key investors and their actions. Furthermore, these tools can include tools that help you to manage the lead lifecycle of an investor, so you can progress them to the close stage as quickly as possible. More real estate companies are making use of software packages that can handle the marketing and administrative workload of fundraising enablement.
Market Your Offers Effectively
You could have the best investment opportunity in the world and a list of investors, but you’re going to have much more success if you also put out your opportunities to the public effectively. You should create a comprehensive and multi-channel marketing plan that gives you the best chance of getting in front of your target investors, which you would have already defined. For example, you may run a local social media ad campaign, in conjunction with an email campaign highlighting your offers. Maintaining an effective marketing presence for your real estate business will undoubtedly help you raise more money for your deals. In fact, real estate is one of the most lucrative markets for ROI when content marketing is done effectively, which highlights the point.
Target The Right Types of Investors
One of the easiest ways to improve your real estate fundraising enablement, is to make sure that you’re actually targeting the right investors in the first place. For example, you may decide that you want to target investors closer to the project site, as it will be easier to maintain a relationship with them. Furthermore, an investor may only focus on one specific type of investment, such as residential properties. If you have a commercial property opportunity, more often than not, pitching residential specialist investors would be a waste of time. Choosing the right prospects is critical to your success and will lead to more consistent results.
Do Business in Good Faith
This piece of advice should go without saying, but the property market can be incredibly tight knit and word can get around quickly. Establishing yourself as a company that does good business and treats investors fairly will go a long way to helping you win more investment. For example, if you give one investor great treatment when working with them, it’s possible that they’ll have contacts of their own who are also investors, and they’ll be able to refer their business your way. This would be more difficult if you’ve made some enemies in your operations.
The Benefit of Being Prudent
If you can consistently get large amounts of outside funding and make a profit from your project, then generally you’re doing well. One key point that will save you a lot of hassle and will likely save a similar amount to what you would have received from an investor, is to simply be wise with your project funds. For example, rather than cutting corners and using cheaper, less-skilled labor to reduce rising building costs, which may result in you needing to pay more to have work redone, simply pay a bit extra to make sure it’s done right the first time. Small decisions go a long way to making a project viable, especially when there’s less funding.
It can seem difficult to branch out and get more qualified investors to help you raise money for your real estate business, however, by utilizing the latest technology and maintaining a collaborative nature when dealing with other investors, you can make things a lot easier for yourself in the long-run. Furthermore, you need to be sure that you’re taking a targeted approach when prospecting for new investors, by identifying the profile of the investor that is most likely to fund you, so you can then focus primarily on investors that fit this profile. Doing these things will see you raise more money.