Business Management

I Make Sure All of My Real Estate Partners Share ONE Non-Negotiable Trait: Here’s Why

Expertise: Personal Finance, Personal Development
32 Articles Written
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Common practice is to partner with someone who is different from you to broaden the company’s skill set and viewpoint. That makes sense, but my partner and I didn’t do a great job of following that practice. My partner is my brother, and we are very alike in a lot of ways.

We grew up together doing the same things, worked the same jobs through high school, started our first companies together and now own our current companies 50/50. We have similar skill sets, similar goals, similar outlooks on life — hell, we have VERY similar lives. Yet it works effortlessly, and our business is doing well.

In 2016 we will be bringing in a third partner to one of our companies. Because of this I had to begin to think about what makes a good partner. Why do my brother and I work so well together? This is a self-reflection that I never had to do before. Now it is necessary in order to ensure that our business continues to succeed.

Related: Real Estate Partnerships: How to Find a Great Fit & Work Together Towards Success

In this article I’ll cover my thought process on why our partnership works so well and subsequently what we were looking for when we found our coming addition to the company.

The Root of a Good Partnership

When I look at my current partnership, I can sum up why it is so successful in one sentence: My partner’s success is equally, if not more, important to me as my own.

Now, I was lucky enough to be born with a brother who feels the same way. That one factor builds this unstoppable force of forward movement. This type of partnership creates a train engine-type of propulsion. When one side pushes the half rotation, that momentum naturally makes the next push forward, one after the other, driving each other to make the next move forward.

When adopting the mindset that your partner’s success is just as important, if not more important, than your own, there is no pointing finger, distrust, arguing, or quitting. If one falls short, the other is there to fill the void, no questions.

Filling the void is not a conscious thought; it just happens. Although I was never a part of the US military, their “leave no man behind” mantra can be related to business. Soldiers live by this in order to always operate as a one unit, not as individuals. In war this supports achieving victory while saving lives. In business this supports success.

Adding a Partner

I won’t dive into exactly why we needed to bring on a third partner in this article. Instead, I want to focus on what makes a good partnership.

So the question was, how do we find someone else to bring on as a partner? For us personally, we didn’t have to; he found us. A friend we met through BiggerPockets approached us at just the right time.

Adding a third partner to a team of two brothers who have worked together all their lives may seem like a tough spot to fill. I don’t think so with the right people. We wanted someone who:

  • Put the company’s and other partners’ success before their own
  • Was not interested in the short term gain
  • Was willing to work to pick up the slack when necessary
  • Was a honest person
  • Was driven not by money, but by the good things money can do
  • Had an unrelenting work ethic

How Do You Find That Person?

Well, that’s all great, but how in the world will you know a person embodies those characteristics prior to bringing them on? The same way you pick anyone entering your life. You judge them! First, start with a gut feeling, then dive into their background. Do whatever it takes to get a sense of their character, past and present.

We almost gave up on the search, when the right person found us.

This man is willing to work with no pay in order to prove himself. After that, he will work as a low paid employee doing the highly demanding job of an owner. Why would he do this? Because he has all the characteristics listed above.

After he earns that trust and proves he can do this, he will become a partner and his success will be equally if not more important to us as our own. That mindset isn’t natural because as humans, we always are looking to get a leg up or help ourselves.

Related: The Truth About Real Estate Investing Partnerships

Do you think that when a soldier is being shot at and a comrade gets shot in the leg and can’t run, his instinctual thought is, “I need to stop, run back towards the bullets, pick this person up, throw them on my back, which will slow me down, and make it more likely I get shot”? The answer is obviously NO. Instinct says run and save yourself. It takes training of the mind to adopt the “put someone before yourself” mentality.

When the individuals of a group adopt the mindset to put the other or the group as a whole before themselves, it an extremely powerful thing.

I’ll end this with two relatable quotes.

“The greatest good you can do another is not just share your riches, but to reveal him his own.” – Benjamin Franklin

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“Your reputation is more important than your paycheck, and your integrity is worth more than your career.” – Ryan Freitas

What specific characteristics do you look for in a partner? 

Leave your tips, comments and stories below!

Jered Sturm is the co-founder of SNS Capital Group LLC. Starting in the industry 15 years ago as a maintenance technician for residential rental properties, Jered built on that experience to start ...
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    Daniel Ryu Investor from Irvine, CA
    Replied over 5 years ago
    I like your analysis of a good partnership. I’ve found the same to be true in my own experiences. Thanks for sharing.
    Maxwell Lee Real Estate Investor from Miami, FL
    Replied over 5 years ago
    Jered, nice insight and well-written!
    Maxwell Lee Real Estate Investor from Miami, FL
    Replied over 5 years ago
    I may get “Glocal B&D” tattooed on my chest. 😀
    Daniel Ryu Investor from Irvine, CA
    Replied over 5 years ago
    Do it! I’m sure Kelly will love it ^^
    Charles Worth Investor from New York City, New York
    Replied over 5 years ago
    Here is another one: “It Takes a Lifetime to Build a Reputation and Only 15 Minutes to Destroy it”.
    Jeremy Jones Musician & Real Estate Investor from Edmonds, Washington
    Replied over 5 years ago
    I also invest with my brother and successfully, good to see it works for you too. I’ve heard several of the podcasts mentioned “never invest with family” 🙂
    FRED GROH Wholesaler
    Replied over 5 years ago
    OH BOY EXPECT SOMEONE TO WORK FOR FREE THAT WONT WORK WORK FOR LESS THEN YOUR WORTH OH NO NO NO I OFFERED MY MENTOR THAT DEAL HE SAID NO WAY LETS JUST DO 50/50 THIS WAY HALF WAY THROUGH THIS YOU WONT LEAVE… BECAUSE I DONT WANT TO DO THIS BY MYSELF
    Jered Sturm Investor/Syndicator from Cincinnati, Ohio
    Replied over 5 years ago
    Thanks for the input Fred. I’m not sure of your current companies structure but our owns a sizable portfolio of rental property. To give away an equity stake to someone unproven and inexperienced would be silly. If we were just starting the business this would be a different story. Enjoy BP it’s a great place to learn. Having a profile picture makes you much more professional. Good luck on your investing!
    FRED GROH Wholesaler
    Replied over 5 years ago
    IN LIFE AND BUSINESS IF YOU SURROUND YOURSELF WITH PEOPLE MORE SUCCESSFUL THEN YOURSELF THEN YOUR CHANCE OF SUCCESS DOUBLES…. THIS WAY THEY RAISE THE BAR FOR YOU AND YOUR BUSINESS..