If you have enough for the down payment in your 401k, use it. If not, do a few wholesale deals to build some reserves. Wholesale can help you do that very quickly.
Pulling the trigger on that first investment property can be scary. My wife and I used the 401K loan option and it has worked out great for us. Once you have that first property, your confidence changes pretty quickly. That was a year and a half ago for us and we have since bought two more properties and looking at a fourth right now. Best of luck!
You need cash to invest in real estate - Whether it be for the down payment or the reserves you will need when something needs to be repaired/replaced.
You may want to consider taking a loan from your 401K or even stop putting money into your 401K to start getting the cash reserves.