Finding A Deal Equals 50% Of The Profit... Is This A Scam?
My local REIA has been in operation for 10 years. I went there 4 years ago and met the owner.
I went to the monthly meetup which was the first one post-COVID. They said that if you find the deal, they'll JV with you and give you 50% of the profit. So if the profit is $20k, they'll give you $10k. This included letting you know if a deal was good or not and setting you up with one of their coaches as part of a coaching program. The coach would show you the process to flipping a house.
I'm somewhat skeptical. I even told the owner after the meetup that it sounded very generous. He said that finding a deal is not easy. My skepticism comes from being in business. From my experience owning businesses, marketing only usually seems to take 25-30% of a company's budget. And coaching someone is very involved.
They also have a lending business that they're trying to grow so maybe this is a reason why the program is so generous. They want to attract lifelong customers. I also thought that it could be a way to give back. Giving back and generosity seem prevalent in the real estate community. But so do scams.
I asked the owner if I needed to put up, say, $10k in exchange for a piece of the profits. He repeated the terms (Just bring the deal and we'll give you 50% of the profit.)
I noticed that they have coaching packages online (very expensive training sessions... what I would expect from a guru). But their Facebook reviews are very clean and date back 3 years (although they only have 5 reviews... none appeared to be coaching related).
So scam or no scam? Is it worth finding a deal for them or not?