There's a pattern I've watched play out for thirty years.

There's a pattern I've watched play out for thirty years.

Real Estate Consultant · Houston TX · Member since 2021 · 122 posts · 92 votes

Investors with college backgrounds tend to pay for mentorships without much resistance. They're conditioned to it. Paying for knowledge is how they've always moved forward. The mentor industrial complex in real estate is built almost entirely on that muscle memory.

Investors without that background tend to go the opposite direction. No courses. No coaches. Just doing it and absorbing the losses as education. That works until one bad contractor or one wrong deal costs more than any course ever would have.

What almost nobody does is the thing that actually works.

Hiring professionals for specific jobs the way a real business does. A CPA for the accounting. An estimator to price work before you commit to a number. A construction consultant to review a bid or walk a property before you close. An attorney to review the contract before you sign it.

Not a mentor who knows a little about everything. Specialists who know everything about one thing and charge you accordingly for that one thing.

The mentor sells you a system. The professional solves a specific problem. One of those has a measurable return on investment. The other has a testimonial page.

Most investors figure this out eventually. The ones who figure it out early are the ones still in the business ten years later.

If you're at the point where you're evaluating who to pay for what on your next deal I'm happy to talk through what actually makes sense for your specific situation. 

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  • Aaron ZimmermanBusiness Member
    Accountant · Chicago, IL · Member since 2018 · 2k+ posts · 1k+ votes
    6mo

    All fair points! Great post! 

  • Don KonipolBusiness Member
    Investor · The Woodlands TX / Avon, CT · Member since 2009 · 6k+ posts · 10k+ votes
    6mo
    Quote from @JS Burnett:

    Investors with college backgrounds tend to pay for mentorships without much resistance. They're conditioned to it. Paying for knowledge is how they've always moved forward. The mentor industrial complex in real estate is built almost entirely on that muscle memory.

    Investors without that background tend to go the opposite direction. No courses. No coaches. Just doing it and absorbing the losses as education. That works until one bad contractor or one wrong deal costs more than any course ever would have.

    What almost nobody does is the thing that actually works.

    Hiring professionals for specific jobs the way a real business does. A CPA for the accounting. An estimator to price work before you commit to a number. A construction consultant to review a bid or walk a property before you close. An attorney to review the contract before you sign it.

    Not a mentor who knows a little about everything. Specialists who know everything about one thing and charge you accordingly for that one thing.

    The mentor sells you a system. The professional solves a specific problem. One of those has a measurable return on investment. The other has a testimonial page.

    Most investors figure this out eventually. The ones who figure it out early are the ones still in the business ten years later.

    If you're at the point where you're evaluating who to pay for what on your next deal I'm happy to talk through what actually makes sense for your specific situation. 


     I think we’re going to disagree on this one….

    My experience is educated people are willing to pay for REAL real estate education/knowledge - not the “mentorship” crap (90% anyway) but college courses/degrees, certifications, education from CCIM institute, Appraisal Institute, etc.  Both Wharton and Harvard offer graduate certificates in real estate investment, as well as MIT offers one in real estate development.  My young cousin, despite having a masters in finance decided he wanted to get into development and paid for and obtained the 5 courses necessary for the MIT certificate. 

    I’ve found that the higher quality “mentorship’s” (there are a few) attract the more educated investors. The hype get rich quick ones attract people who typically tried college for one semester and dropped out.  These same people were also involved in multi level marketing, brokering “daisy chains”, low cost “licensing sales rep agreements”, and various other sucker plays that emphasize how conventional education is useless, thus playing into their personal inferiority bias. 

    I don’t see hiring professionals as a SUBSTITUTE for education; it’s a way to increase the probability of a better outcome, insure a smoother experience, and obtain “peace of mind”.  Whether one “graduates” from Joe Flipper mentorship, Harvard real estate certificate, or is self educated via written works, they should use experts for any area outside their own expertise. 

    I found that many of the people wanting to get into real estate without paying for education are either very “thrifty” (cheap) and don’t care if their education takes twice as long and is half as good, as long as it “free”; or are “know it alls”, the kind of person that after he learns you just purchased a car tells you he could have gotten it for you cheaper; tells you that you made a mistake buying your house because it faces the wrong direction, and tells you that for the same price you paid for a weekend in Idaho he went and his family vacationed in Tuscany for 2 years. 

    Private Mortgage Financing Partners, LLC
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