Motivations Matter in Investing:
Re-trade conversations are being had throughout the industry regarding purchase contracts, due diligence and lender offerings. Our world is changing rapidly and very little is static at this moment in our real estate cycle. As I work my business through this cycle, I am reminded time and again of the lesson I learned working early on in sales. I worked for a true entrepreneur who had one idea that he turned into a huge organization, eventually cashing out for over a billion dollars.
He had several mantras:
- Never ask for a million dollars unless you’re in a suit.
- Friends don’t fire friends.
- Always go directly to the client.
- Motivation is the key to every sale.
I remember sitting in the training having been a media buyer in my prior roles. We played power games and if a salesperson went behind our back to the client, it was the kiss of death for them. We black balled them. We would do whatever we could to never buy their products, services, or goods. I’m sure many of our readers understand the power dynamic of the gatekeeper. I was one. I thought he was full of shit when I listened to him. Figured I’d made a mistake and was in the wrong company. Then I started to listen to the next 3 mantras. They made sense to me.
“Look good.” Feel good if you’re going to ask for a big commitment. Ok, that works.
“Friends don’t fire friends.” Well, I guess not. Ok.
“Motivation is key.” Huh? I sat there and watched his presentation trying to poke holes in it. He did own the company outright. At the time he had a whole lot more money than I could imagine and I wanted what we had—money.
So I listened. Over time I put it into practice.
Early on in my sales career I learned that motivations are key to how anyone approaches an issue, a challenge, a problem, a puzzle—whatever is in front of them. As I worked through the years it became apparent who was making buying decisions based on what criteria (or motivation). A gatekeeper often made decisions based on how to maintain status quo, or not rock the boat. A risk was an impossible ask of a gatekeeper type client.
An ego driven client who had to be right would never take criticism. If you offered a suggestion around “being bold” or “taking a very well calculated risk” traction would often materialize.
Someone who was a “see more” had a simple motivation—find the hole in the pitch and exploit it to show why you couldn’t be purchased. Words like bold or risk would result in a dead proposal.
A “results oriented” buyer would focus on the outcome naturally, and the methodology often wasn’t of import to them. These were our home run clients. I sold a product that was not mainstream and yielded huge results when purchased correctly.
It was a sale that went against the grain of the industry. I loved it. It’s much like multifamily. It’s a tad against the grain of a typical stock market portfolio. If the investor is “results oriented” they get hooked. The results deliver. If the investor wants to stay in the safe boundaries of investing, this is not for them.
Motivation is very similar on the deal side of the equation. If a seller believes you’re a Karen, and super picky, it might be hard to get much movement or negotiation around key items because it’s really hard to distinguish what are key items and what are not.