How Self-Awareness Can Lead You To Syndication Success

How Self-Awareness Can Lead You To Syndication Success

3 min read
Adam Gower

Adam Gower Ph.D. is a highly sought-after expert in crowdfunding, helping real estate professionals finance their projects without having to spend all their time searching for investors. Learn more about how he does that in his personal biography, here.

He has more than 30 years and $1.5 billion of transactional experience in commercial real estate finance and investment and is actively preparing to buy distressed real estate and non-performing loans— both a type of real estate in which he has considerable experience. Over the last five years, he has built a digital marketing agency at GowerCrowd.com, where he advises real estate pros on how to raise capital by helping them build and convert their investor lists.

Experience
Adam has held senior management positions at some of the largest companies and institutions in the world, including running real estate for Universal Studios and Paramount Studios (Asia Pacific), heading the distressed real estate group at a major California bank ($1 billion portfolio), running real estate workouts and sales at Colony Capital ($6 billion portfolio), and others.

When the JOBS Act of 2012 was passed, Adam realized that commercial real estate finance would be transformed by the new regulations by permitting equity to be raised online. Seeing that this would revolutionize the industry, he formed GowerCrowd, an agency geared to assisting real estate developers raise money online by crowdfunding and to educating investors on what to look for.

His goal is to liberate real estate entrepreneurs from the shackles of in-person equity raising by automating the process for them so they are free to buy the deals they want, grow their portfolios, and provide passive income for themselves and their investors while building long-term wealth.

Adam has published multiple books, including Leaders of the Crowd
(Palgrave Macmillan: New York, 2018), which examines how the origins of crowdfunding and how real estate has come to dominate the industry; Real Estate Crowdfunding: An Insider’s Guide to Investing Online (Routledge: New York, 2020), which gives investors the inside scoop on what to look for when investing in crowdfunded deals; and his latest book, SYNDICATE, a practical guide on how to raise money online.

He is host of The Real Estate Crowdfunding Show, Syndication in the Digital Age podcast and writes extensively on real estate crowdfunding best practices.

Press
Adam has been extensively covered in the national press including Routledge.com, Commercial Property Executive, The Real Estate Network, Forbes, GlobeSt., REJournals, NAIOP, Propmodo, has appeared in countless podcasts and webinars. He provides educational training on Real Estate Syndication in the Digital Age on the Springer network, the 150-year-old “leading edge of information for people on the frontier of research,” as well as having taught the only fully accredited university course in the country that focuses on how to successfully invest in crowdfunded real estate syndications.

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“Know thyself” has persisted as an eternally useful concept. As one of the three Delphic maxims (the others being “nothing to excess” and “surety brings ruin”), the collective need for self-awareness has been a constant of human history, philosophy, and society. And while digital marketing in real estate syndication may not be quite as romantic as a Greek epic, the importance of self-awareness continues to live on.

In fact, it would not be unrealistic to say that self-awareness is the bedrock of every broader marketing campaign. Firms and sponsors that are unable to see themselves as they truly are will inevitably either end up disappointing investors who were expecting something much different or they will fail to realize the way they can uniquely offer value to the marketplace.

In both scenarios, a lack of self-awareness will prevent otherwise well-structured syndicates from ever reaching their full potential.

With self-awareness, a sponsor can begin to authentically set realistic expectations. That, in turn, will help build trust and establish the syndicator as a serious contender, rather than a charlatan (something that is a dime a dozen in this industry). This is particularly crucial for firms that are trying to appeal to wealthier investors.

Related: 6 Steps to Structuring a Solid Real Estate Deal With Investors

The wealthy have heard seemingly countless pitches throughout their lives, coming from just about every industry. These people are not looking to “get rich quick”—they already are rich, meaning that their top priority is preserving and modestly building their wealth as opposed to assuming some high-risk endeavor.

In fact, they are probably not even looking for the “best deal they’ll ever see.” Because as experience has taught them, anyone who is capable of promising such a deal is either being dishonest or hindered by a delusional sense of unearned confidence. This brings to mind the aforementioned Delphic maxims: nothing to excess and surety brings ruin.

Raising money from high net worth individuals takes finesse. Watch as author Adam Gower discusses with Family Office Club’s Richard Wilson how NOT to pitch to investors.

The Gateway To Credibility

Recognizing the need for self-awareness is one thing, but it will still remain up to the sponsor to take the appropriate course of action. To begin establishing a sense of authenticity, a sponsor will need to take a look at their past history and see how they have been able to deliver.

Suppose that during a recent project, you suggested to investors that they could earn a 10% return on a one-year investment. What was the rate of return you were actually able to deliver?

If the final return was 10%, your investors were likely pleased. If it was 12%, then they were almost certainly pleasantly surprised. But if it was 8%, this suggests to investors that you consider underdelivering to be something that “just happens” and is a “part of doing business.”

With just one instance of underdelivering—even during chaotic market conditions, such as those we’ve seen during COVID-19—your word as a sponsor will be severely damaged. And once your word is lost, you will need to do exponentially more work in order to regain the trust of these once reliable investors.

Related: Real Estate Syndication: 3 Ways You Can Profit

The Power of Exceeding Expectations

“Under-promise, over-deliver” is a mantra that is heard in countless industries around the world, yet few sponsors apply it in practice. The temptation to over-hype oneself is strong, especially when doing so can potentially add millions of dollars to your balance sheet.

However, as soon as you zoom out a bit and develop a long-term perspective, it quickly becomes clear that it is much better to be the firm that is “always pleasantly surprising” than the firm that is “always making big promises.” Again, this is especially important when marketing to the very wealthy and to those individuals that are extremely reluctant to give up any of their hard-earned capital.

Self-awareness can also be the gateway to creating a better value proposition. Promising that your firm can offer something that is unique, rather than promising to be the very best at everything, will help reinforce your deal offerings and potentially advance your credibility even further.

Your unique angle can be pretty much anything: working with a specific asset, working in the crowdfunding space, targeting specific markets, or having a unique business structure are all ways a syndicate can distinguish itself from its vast competition.

To succeed in this industry, you will need to develop a strong brand, effectively express a value proposition, and—perhaps most importantly—have returning investors. If you can be honest with your investors about who you are and what you are capable of offering, they will be remarkably more likely to stay by your side.

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What distinguishes you from other investors?

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