The 3 Stages of The Persuasion Conversation

Capital raising is one of the most important skills for all multifamily syndicators. Some enjoy this task, while others despise asking people for money. I look at capital raising as my obligation to share the opportunity with as many people as I possibly can. If I believe with my whole heart that what I am offering can benefit everyone, then why would I not want to share it?

I have learned the art of persuasion and selling from numerous sources over the years, however, the best persuasion techniques that I have learned came from one of my favorite mentors, Brendan Burchard. I am an avid student of his. What I am about to share with you, I learned from Brendan’s Persuasion Masterclass.

If you don’t know what to say to get others to buy into the opportunity that you are offering to them then this is your ticket to capital raising bliss. Persuasion is the science and the art of influencing someone to do what you hope they will do. I don’t particularly like the word persuasion, because it could be perceived as manipulation if not done correctly...I prefer to call it influence. You are not manipulating them when you have the right intention to help the person that you are influencing to take action and invest with your team. You are simply encouraging them to help themself.

The more thoughtful and strategic you are in your presentation with potential investors, the more often you will win! Brendan teaches a three part persuasion conversation that will help you to move through your approach with a potential investor more strategically. He calls the three steps Pre-suasion, Conversation, and Post-suasion.

The goal of the Pre-suasion stage is to internally strategize what you want the clear outcome to be. What do you want the other person to know, think, feel and do? Why should they do all those things? It is important to think in advance with more diligence, greater discipline and more consistency. This will greatly help with your confidence when sitting in front of a potential investor. You should know exactly what you are offering to them, what they will get in return, why they want what you are offering and why they should invest with you and your team.

One of the best persuasion techniques is the objection killer metaphor. If you use visualization, metaphors or similes to explain what you are offering, you are way more likely to get their attention. Ask yourself what triggers investors to do what they do. As an investor, what do they need and what drives them to invest. The most important step in the pre-suasion process is to understand what these triggers are and use them throughout the entire conversation process. Brendan teaches the following 8 triggers.

Novelty. People like new, bright, shiny objects so your job is to share with them the new experience they will have if they chose to invest with you. This will assist you in fully captivating your potential investor. Prior to your conversation with an investor you need to ask yourself what’s new? What is cutting edge or thought provoking? What is here today that was not available years ago? What about your offer can bring newness into their life?

Utility. People buy things because they are useful. It is your job to sell the features of the project/investment you are offering and why those unique features are useful to them and the investment as a whole. This could be the financing terms, amenities of the complex, the business plan, the sponsor team experience, etc. Don’t leave anything out!

Pride. We all have ego. We all want to believe that what we have done up to this point is important. For them to buy into what you are offering them, they are going to have to relinquish an old belief. For example, if the investor that you are sharing this opportunity with has never heard of multifamily syndication, they’re going to question “Why have I not heard about this?” You may need to stroke their ego a bit by letting them know that not very many people that you talk to actually know that you can invest only $50K into a $20M apartment complex and receive higher than average returns and tremendous tax advantages for doing it. You will lose them if they feel stupid for not understanding what you are offering. You don’t want a wounded ego.

Popularity. People will buy, believe and act because they think it is the popular thing to do. Make sure that you share with them who else is investing in multifamily syndication deals. Let them know why it is fashionable to invest in large apartment complexes and be sure to trigger their fear of missing out on the opportunity. We want to help them join the club!

Aspirational Connection. If you can create an aspirational connection with an influencer that others aspire to be, that can be very helpful in your persuasion efforts. Talk about others that they may know that are investing in multifamily syndication and experiencing the benefits of such investments.

Benefit Extension. Brendan uses this phrase to refer to the benefits beyond the person to the community and the world at large. Share with your investor the impact their investment will have on the residence and the community as a whole.

Scarcity. When things are hard to find, only available for a limited time or less available, people understand that they must act now or chance missing out on an incredible opportunity. FOMO or Fear of missing out is a very real phenomenon.

Fulfillment. How is your offer going to make your investor feel great? How will they be personally satisfied or get more power so they will be more fulfilled as a human being as a result of investing with you in this deal.

The second stage of the Persuasion Process is the Conversation. You want to make sure that you are opening up the gate to the conversation with your investor slowly. You want to first make an observation that you think they will agree with you on. For example you might say “Have you seen…”, “Have you ever heard….”, What do you think about…” You will want to ask observation questions until you get a positive response. This will help them to make the case you are presenting to them for you and since people support what they create in their mind, they will be more than halfway to a yes.

Now that you have them on your side, if possible, you want to share a personal experience related to that positive response they shared. You then want to authentically acknowledge them by letting them know how smart they are and how much they already know about the opportunity that you are sharing with them. Finally, you want to make the suggestion that they consider looking at the opportunity since they clearly need the benefit that you are offering.

The hard work is now done. It’s time to close the deal. Once they verify that they agree that it’s a good idea and/or would be beneficial to them, then you can ask, “So would you like to try….?” At this time you want to get the commitment from them. You will need to repeat this process until you get a yes.

The final stage in the Persuasion Process is Post-suasion. This is where you must follow-up with your investor and see the deal to the finish line. If you want something and truly believe that what you are offering the investor is beneficial, do not quit! Remember that most people will not say yes the first time you ask. You will more than likely need to answer questions and give them time to process what you are offering them. Brendan suggests that you write them a 4 sentence email making the case for why they should invest even if they already said they would. Include a deadline that you must have the signature docs back. If possible, add a bonus or surprise that they didn’t know was included. You also want to reveal the opportunity cost associated with not following through. If they don’t return the docs and wire the funds by X, the team will have to accept someone else in their place. Let them know that you are looking forward to working with them and that they are not going to regret it.

Most Importantly, remember to think in advance and prepare thoroughly for the persuasion conversations you have. Once you get a commitment you want to follow up immediately! Should you not get the commitment that you were after, keep adding value to that investor until they are confident in what you are offering. Remember, people invest in people more than things. Be authentically yourself and don’t give up!