Most of you have probably heard the saying, “No man is an island” by John Donne, a 17th Century English author. I heard someone say this at the first mastermind meeting I attended as the reason they wanted to be part of it. It has resonated with me to this day. Translation: no one person is 100% self-sufficient. We all rely on others at different points in our lives. Not only in our personal lives but also in business. Having a team that you can depend on in a business environment is critical to your success.
Now this might not be intuitive if you’ve never been in a mastermind group before, but I want to make it absolutely clear that one of the most valuable assets you can possibly have for taking your real estate investing (or any business endeavor) to the next level, is a mastermind group. I can tell you in all honesty that I would not have the portfolio, the resources, or the knowledge base I have today, without my mastermind group. In fact, most of what I know about real estate investing came from being part of my mastermind group.
I learned how to buy deals correctly, protest property taxes, find the best real estate attorneys, create special provisions to my leases, find my property manager, find my CPA, as well as excellent tradesman for any type of work—all from my mastermind group. I’ve learned more than I can possibly relate here, but literally, I’ve found resources on anything involved with real-estate investing from difficult situations with tenants and clients, code enforcement, the city, contractors, etc., from my group. I have also done multiple deals with everyone in my group—we all do business with one another. I cannot stress enough how it’s more powerful than you can possibly imagine. So if you are currently not in a mastermind group, I encourage you to get one started ASAP.
So What Is a Mastermind Group Anyway?
The mastermind group concept comes from Napoleon Hill’s book Think and Grow Rich. If you haven’t read it, I highly encourage you to do so. At least read the chapter on the mastermind concept. For now, you can watch YouTube videos where Napoleon explains the concept if it’s completely brand new to you.
Basically, the concept is this: the whole is greater than the sum of the parts. That is, 1 + 1 = 3. The point is that 2 brains together are actually equivalent to 3 brains on their own. This principle works exponentially the more minds you add. So imagine the power of 15 people. This synergy will produce valuable information that will propel your real estate investing faster than anything else.
Who Do You Need In a Mastermind Group?
There is no hard and fast rule about who must be in your group. For example, our group consists of full-time real estate investors and everyone owns rental property. We have agents, brokers, an appraiser, some lenders, an accountant, a financial planner, and some wholesalers as members. However, we weren’t looking for those types of backgrounds when we got started, it just happened to evolve with those individuals over time. Just to give you an idea of the volume of business we do, combined we close over 100 transactions each month.
What’s key is that those in your mastermind group are open, honest, and trust each other. We have no secrets, and no one would ever go behind anyone’s back in a deal! We discuss everything openly and I consider everyone core members of my real estate investing team.
Starting Your Own Mastermind Group
So how do you start a mastermind group for yourself? Begin by networking with people in the real estate investor community (i.e., local investor clubs, meetup groups, etc.) Find those people that are at your level or higher—those that have different backgrounds but share your goal of getting to the next level in their real estate career.
Focus on finding someone with similar interests (wants to build a rental portfolio, flip houses, etc.) and start meeting with them on a regular basis. Then, add a 3rd person that you both agree to bring into your group. Have a meeting or two with them and then find another person and add them. Don’t rush into adding too many people at one time or feel like you have to build a large group immediately. This is about quality, not quantity. You need those individuals where you can build strong relationships of trust.
Setting the Ground Rules For Your Mastermind Group
As with any organization, it’s important to have a set of rules or guidelines that everyone can follow so that meetings will be taken seriously, and you will make the most productive use of time. After a few meetings, it will become easier to get a feel for how you want to structure it. You certainly don’t have to do it the way I am going to describe, but after 10 years of meetings, I have found the following to be most effective:
- Group Size: No more than 15
- Frequency: Every other week for no more than 2 hours
- Agenda: Roundtable discussion where each person has about 5-7 minutes to discuss what they are working on and/or bring up any issues they are seeing or experiencing in the market. Maybe have a guest speaker occasionally that adds value to the entire group.
- Participation is Key: You want a group where everyone participates in the roundtable discussions. If you have this, meetings take on a life of their own. This is where the real “mastermind” takes place. Once everyone has heard from the rest of the group, the meeting can take on a new form where members can jump into the conversation and share what they believe would add value and benefit the entire group.
- Attendance Policy: Try to get everyone to commit to attending every meeting
- Adding New Members: Pace yourself here and do this slowly by getting consensus from the group on specific people to add.
- Removing Members: It’s important to have the right people in your group to have the most success. From time to time you may need to remove more than one person, so don’t be afraid to do this. Anyone who never shows up, is toxic in the group, is a pessimist, or brings the meetings down, needs to be removed. If you don’t, you will regret it because other members will leave your group. To remove someone, simply send an email with a message like this: We have had some members that have not attended any of the meetings. I am requesting that anyone who does not want to participate, to please let me know and we can remove you from the group email list. Or, give them a call them to explain the fact that you (and your group) feel that they may not be the right fit for the group and that you are going to remove them from the email distribution list.
Conclusion
Find the right people, the right venue for having the meetings, and have fun with this. After your first meeting, you will experience the value I have described, will look forward to every meeting, and will soon watch your real estate investing accelerate to the next level.
If you are a Real Estate Investor, looking for a Hard Money Lender, contact us today!
Mike Hanna is a real estate investor, mentor, author, and public speaker. He has been an active real estate investor since 2002 in both single family and multi-family properties, and has been in the hard money business since 2005.