Unlocking Capital: The Power of Real Estate Funds

Mike Hambright (00:00.866)
Hey everybody, welcome to the show. Today I’m here with my buddy, Devin Robinson. We’re gonna be talking about how to create a fund and what funds are for real estate investors. It’s gonna be a great discussion because a lot of real estate investors could really lever up their business. And I’ll let Devin kind of talk a little bit more about the benefits of a fund, but with more capital. Like at the end of the day, we all are constrained by capital. We can almost never have enough. And sometimes our visions are bigger than the amount of capital that we have.

Devin Robinson (00:27.504)
Yeah.

Mike Hambright (00:27.692)
So how do you grow into that vision? Well, you might need more capital. So Devon, welcome to the show.

Devin Robinson (00:31.374)
Hey, thanks for having me, man. I appreciate you.

Mike Hambright (00:33.292)
Yeah, yeah, excited to talk about this today. And so before we dive in, I know you have a ton of experience as a real estate investor as well, found your way into the helping real estate investors kind of create funds world. And I’m guessing just like a lot of other people that end up creating a product or a service out of the real estate business, it was based on a need that you had yourself anyway, but maybe tell us the story.

Devin Robinson (00:53.894)
There’s no doubt. Yeah, man. So, OK, so and this is really funny because like you would think if you knew me and what I’ve been through, you think I’ve been doing this for I don’t know how long. But I really started, I guess, right before Covid. So probably like. And I guess I would say in twenty twenty one, I started because I learned about real estate wholesaling on TikTok, which is hilarious. So learned about it on TikTok as any young, good millennial would do. And and so I go to my wife and I had started a couple of other businesses.

Mike Hambright (01:14.133)
Hahaha.

Devin Robinson (01:21.478)
Grew some crashed and burned some other ones sold some other ones in like and then I was like, Hey, babe, you should try this thing called wholesaling. It’s a way to get into real estate and she was like, ah, no, I’m good And I was like, alright, I’ll just try it. We ended up growing pretty quickly We did 70 deals in our first six months of getting into it and we did it in a pretty unorthodox way We went straight to which is kind of funny now that I see like it go full circle We actually were just we we rode the wave of the hedge funds back in 2021 before they

Mike Hambright (01:39.342)
I apologize.

Devin Robinson (01:50.662)
I’m kind of stopped buying. And so we did a ton of deals in that first seven, six months, 70 deals in the first six months. And that was between like April 2021 and November 2021. And then right after that, they stopped buying and kind of just like fell off the table. So I went from 70 deals to the first six months to four deals in the next five months. And then I had to like lay off my staff, get out, leave out my office. It was like crazy. We went from zero to we went from I typically go from zero to 100 very, very quickly. And then we went back to zero.

Mike Hambright (02:10.83)
Mmm.

Devin Robinson (02:20.582)
Like we fell off of a cliff and then I took the next six months. Um, put my head in the, just put my head in the dirt and built out as like systems and processes to really help us to scale back to where then we were doing, you know, um, I think we’ll do, uh, probably a little over like 3 million this year. And so like really scaled up to be able to, um, uh, to, honestly be able to ride the waves of last year, which absolutely sucked. And then, uh, and then, but having the systems and the processes and the infrastructure in place to be able to.

Mike Hambright (02:21.89)
Yeah.

Devin Robinson (02:50.096)
to get to where we are. And one of the big things that helped me get through last year was the fact that I’d started a fund to be able to one, it was kind of, we did almost like a little bit of a hybrid of like a private equity and real estate fund in our company with our company. So people actually invested into my wholesale company, which was cool. But then they also got to claim like the depreciation and all that stuff through it. So we held assets. We gave, you know, know, profits. did, we kind of had it structured. So we did profit splits and did all that stuff. And so

One of the main reasons though that I started the fund was because we dove into foreclosures. And when you deal with foreclosures, you have a lot of people that need cash fast. They’re like, hey, I’ve got an auction coming up this weekend. I need I mean, this week or this Friday and we need to close on the house or I need to pay off the arrears and reinstate the loan. And although private money is significantly more convenient than hard money or, you know, conventional lending, it still can be pretty inconvenient because I’ll be like,

Hey, hey, Linda, I’ve got a deal that you said you wanted to be on. have to close pretty quickly. you’re on vacation. Can you can you go to the bank while you’re on vacation, please? Like, you know, like, hey, can you can you do this? Can you do that? And OK, can you send the payoff? And it’s still got pretty cumbersome. So then I just was like, well, you know what? Why don’t I just figure out how to raise more capital so I don’t have to worry about that? And then I actually joined because really there’s only two people in this space. There’s like four now.

Mike Hambright (03:57.485)
Yeah.

Devin Robinson (04:17.328)
But there’s really only two people in this space that teach on how to raise capital at a high level. So I joined those masterminds and both of those masterminds ended up being like how to start fund type masterminds. And so I was like, and then in that context, I went in there just thinking, how can I raise more capital? And then I came out three months later and I had a fund and I had launched a fund. And so it was really cool. And then I learned a ton in that process and then still realize though, like

Mike Hambright (04:28.867)
Hmm.

Mike Hambright (04:38.424)
Yeah.

Devin Robinson (04:44.698)
there really is still only like two to three people that teach this. And there’s still this massive disparity between like who’s learning it, who’s not learning it, who has access to learn it. And so from there on, it was like, OK, then how can I help people continue to learn this? Because I see a lot of people not doing it correctly. And so then out of that desire, after out of seeing that, I had a really strong desire to be like, OK, how can we fit this need that is clearly it’s clearly here and so we can help save people from.

Mike Hambright (05:02.626)
Right.

Mike Hambright (05:13.644)
Yeah, that’s great. You’ve got that sign behind you that says hustle. And that is part of the problem. There’s a lot of real estate investors that will hustle. And they’re not trying to do anything illegal, but they’re just trying to make shit happen. And so there’s a right way and a wrong way to do a lot of things, it turns out.

Devin Robinson (05:13.882)
being in a lot of trouble.

Devin Robinson (05:25.734)
That’s right.

Devin Robinson (05:30.502)
Well things that you would feel like so like they feel obvious like sure I can Like yeah, why wouldn’t I be able to have somebody like send me some money? I create some sort of like document that just says I’m gonna give them some money back for the money that they lend me and then like I And then I just we just between us two. We just work on that. It’s technically a security You’re technically like committing like SEC SEC violations and people just don’t realize that if you have passive investors

and you don’t have the legal documents to back it up, like you’re operating outside of security laws and you’re breaking the law. But people just don’t realize it because it seems like, I should just be able to do this. It’s me and a friend. But really, like, can’t. So it’s really interesting.

Mike Hambright (06:14.734)
Yeah, yeah, that’s awesome. Well, I wanna get into like funds and you know, how to use them, like how to stay out of prison, like a bunch of stuff here. So, but before we dive into that, why don’t you tell us, we talked about this a little bit upfront, know you’re kind of on a mission, so tell us a little bit about why you do what you do.

Devin Robinson (06:22.02)
Yeah, of course.

Devin Robinson (06:29.86)
Yeah, so great. This is great. So I grew up, I grew up in L.A., California, single mom. And we didn’t even really talk about this. I grew up in L.A., California, single mom. And I joke, I say she’s true triple double mom, three jobs, two kids, like worked really, really hard to be able to give us the life we wanted or honestly, not even necessarily the life we wanted, but the life that we needed to be able to be successful in life worked so hard. But like I never grew up, no matter how hard she worked.

She did she didn’t leave me with assets. She didn’t leave me with any sort of wealth She didn’t leave me with anything like that and it’s not because she didn’t want to or it’s not because really not because she didn’t want to She had never learned like nobody had ever taught her how to do it And so then I started realizing so I grew up and I grew up around gangs I grew up around drugs and alcohol all that stuff and was forced to move from LA to Raleigh, North Carolina And so was forced to do that because of the way that I was living and so I would either be in jail

or are dead if I still lived in that context. But I really do think, believe that God picked me up from one side of the country, put me on the other side, saved my life. And in that context, in that, one of the things that really struck me that I understood was like, there is a massive lack of education. There’s a massive lack of access to capital between like minorities, women, and immigrants in America and the rest of people. So,

There’s a really interesting statistic. There is $82 trillion worth of assets under management in the United States currently and private equity, hedge fund, real estate, all that stuff. 1.4 % of that is managed by minorities, women and immigrants. So that means that 98.6 % of all assets under management in the U.S. are managed by like white men. And so there’s it’s not because and I strongly think it’s

Sure, it’s a systemic thing. It’s a historical systemic thing, but I think it’s a massive lack of access to capital and access to information. I think the world equally distributes talent, but doesn’t equally distribute opportunity. There are people way stronger than me out there, or not stronger, way smarter than me, way more talented than me, all of these things, but just don’t have access. And so for me, that’s like where my heart is on that side of it. But then also one of the big reasons why like I think funds are an incredible vehicle because

Devin Robinson (08:48.324)
Not only are they the most like lucrative business model in America, which we’ll probably talk about later, but also they give you a really unique opportunity to scale impact in this world. So my, my, my wife and I, have fostered and adopted three kids currently. We have four now we’ve had five kids that we fostered, through come through our home. and there is just a massive systemic issue between in, like, man, it’s a completely broken foster care system. And I’ve seen it in the depth of like just how bad it is and how

honestly, in a lot of ways how just broken and destructive it can be for kids. Crazy statistics that like 98 % of kids that are in five homes or more will be incarcerated in their life. 98%. I think it’s like 86, 80 % of all people incarcerated in America have been through the foster care system. So there’s just this, there’s this huge connection between incarceration and foster care.

and a broken system that keeps people in this vicious cycle, like even parents. And so for me, I think that we talked about this as well. Like, I think that if you really want to make change, you can mail your senators all you want. But unless you can create some really like you unless you have some sort of like influence in this world through business, through whatever social media, through a whatever, I don’t know if you can actually create massive and real impact in this world.

And so I think like this is the vehicle in which we’ll end up doing that I think is like a byproduct of what we’re doing is hopefully we create massive impact in this world and we change a lot of lives. Yeah.

Mike Hambright (10:19.106)
Yeah.

Mike Hambright (10:24.942)
Yeah, that’s awesome, man. Congratulations on the end of the day. Like I’ve talked about this a few times lately.

for real estate investors is like, you gotta have a calling bigger than yourself. you get to a point, I mean, we all started that way. Like when I started real estate investing back in 2008 and I needed to feed my family, we were in survival mode at that point. But then it gets to a point to where you’re like, another deal, that’s cool, that’s cool, that’s cool, right? And you have to have a purpose that’s kind of bigger than you and it’s usually on impacting others. So congratulations on that for sure.

Devin Robinson (10:33.989)
Yeah, man.

Devin Robinson (10:41.178)
Mm-hmm.

Devin Robinson (10:51.974)
Yeah, man.

Devin Robinson (10:56.276)
well, thanks. And I think we all have something. And it’s just the courage that you like, do you have the courage to do what it takes to be able to step out in faith? Because a lot of times it’s like, I don’t know, I believe I can make this impact in the world. And that’s what I’m doing it on is some sort of belief and a conviction that it needs to be done. And that a lot of times will come at come. It’s got to be bigger than me because it’s going to be easy to quit. It’s going to be easy for me to be like, I can’t I can’t get up and do this because no change is actually happening now. I’ve got to believe that.

the constant consistent steps that I take right now will create massive impact and change in the world in the future. So, yeah.

Mike Hambright (11:32.75)
The way everything works for us, just, this was on another show I did recently here was like the person I had on was just kept saying the same words, like we’re all meant for something bigger, right? And as an entrepreneur, everything we do to get to the next level, like we don’t know how to do that, but you have to get there and figure it out. Like a lot of people that get stuck.

It’s because they’re not willing to take a risk and possibly fail. But once you get to the point where as an entrepreneur you’re like, I know I’m gonna fail, but that’s part of the way forward. Like I have to fail, I have to touch a hot stove. have to like, something bad has to happen. know, hopefully they’re not like.

so badly knock you out of the game. But you have to be willing to try. mean, same thing when you walked like when you have a little kid that’s like learning to walk, you can’t be like, you tried it and you fell down, like don’t do that anymore. Like you’re done. You’re never going to walk in your whole life. not walking is not for you. Right. As an entrepreneur, though, we’re like, you get up, dust yourself off, get up, get up, get up. And eventually you’d like, man, walking is so easy, you know, but you didn’t know how to do it when you first started.

Devin Robinson (12:21.243)
Yeah.

Devin Robinson (12:32.752)
That’s right, Dan. That’s right. You only fail if you don’t get back up. So keep keep falling.

Mike Hambright (12:37.518)
That’s right, that’s right, yep. So there’s a lot of ways to raise money for real estate investors. I mean, they could raise money from friends and family, private money, private mortgages. Like there’s a lot of ways, obviously hard money and things like that. So why a fund? Why a fund specifically?

Devin Robinson (12:41.893)
the

Devin Robinson (12:52.792)
this is good. So I think one, because you have a really unique opportunity to be able to structure it in a way that’s really advantageous to you. like you can structure it in a bunch of ways that one can help you to either raise the most capital possible by making it really, really appealing to your investors or another way that that be able that that’s able to help you to leverage money to be able to get something you couldn’t really have before. Because like I still believe in.

Leverage right where I would let’s say you have an asset. So let’s go like for a multifamily asset Let’s say you have an asset and it’s ten million dollars and a lender is only gonna Hard money or whatever a lender is only gonna come in at 70 75 80 percent on that You still need to come up with the other two hundred thousand and you could do that yourself. You totally could but you also could leverage So if you want to start like a syndication, right? You start something like a syndication where you can pull four or five six ten other investors to bring in the rest of that 20 percent

Then you have something like syndications are very similar to funds, but they’re just single assets. So then you have something like that where you now can be able to compliantly raise that $200,000. You get to take a lot of that upside on owning the asset without having to come in with your own money. But then you get to share in that and with your investors get to take like the depreciation from it. And then they also get to they also get to have an asset that they wouldn’t normally be able to have. So you have so much opportunity to serve.

One, people that wouldn’t normally have access to that type of deal. And you also get to leverage just a more of an amount of money. And I always say if you’ve raised private money to do a flip and you create like a promissory note, that’s just those are like many syndications. That’s literally all those are is just like many one-off syndications with less paperwork and probably a lot cheaper to start. Definitely a lot cheaper to start. So that it’s the same thing. You’re allowing somebody else to come in on your deal, but you also get to share in and take in more of the upside on it.

But if we’re talking about like a fund, something a little bit differently, you now have a ton more control. I always think of, I don’t know if you’ve seen the big short, but I always think of, yeah, yeah. A lot of people have seen the big short, but I always think of the, the scene where Mike, Mike, Michael Berry, Michael Berry. Yeah. Yeah. But he’s sitting in there, right. And

Mike Hambright (14:55.672)
Yeah, yeah.

Mike Hambright (15:03.682)
Something like that. I know you’re talking about.

Devin Robinson (15:07.664)
The market’s crashing. He’s betting against the market and everybody’s like, why would you do this? All this stuff. So it hasn’t hasn’t crashed yet. And his biggest investor comes into his office and his and this investor is like, I want my money out. Blah, blah, blah. And he’s like, sorry, bro. You can’t take any of it. He puts his headphones on. He plays his heavy metal and he keeps going. And at the end of the day, like he wins big because he he bet on himself on that. And so when you have a fund, you have like significantly more you have significantly more

Control over the money because you have a thesis that you’ve created and you say hey guys I’m getting I’m betting on this thesis here. You guys are investing into me And then I’ve created rules and laws are not rules I’ve created rules in my PPM Which is like your private placement memorandum that give me the ability to control this as long as I stay in line with Doing what I said, I’m gonna do I really control whatever I need to control on this and so it gives you a lot of autonomy in there

while still being able to leverage other people’s money. And then it allows you to, it allows you to do a lot of things like we haven’t even talked about being paid off of it because you could do profit splits. You can leverage with profit splits. You could take management fees. You could do all these things that allow you to be able to scale significantly higher than if you just had your own money to work with or if you didn’t have any money to work with in general. So that’s why I love funds and we can like dissect that a lot more, but that’s just kind of like the

Mike Hambright (16:26.862)
Sure.

Mike Hambright (16:32.824)
Yeah. Well, I’ve got a couple of questions because I think one of the challenges is, and I think about this for myself and other people too, I feel like I could raise, I actually have raised a lot of money for syndications, typically multi-family syndication. So I could raise, I know I could raise a lot of money, but then my concern is like, it’s easier, so for me specifically, it’s easier to raise money than it is to keep it all busy. So talk a little bit about that because I think a lot of people like, one thing that…

Devin Robinson (16:48.998)
Mm-hmm.

Devin Robinson (16:56.091)
Mm-hmm.

Mike Hambright (17:00.108)
some people are maybe afraid of on a fund is like, well, how do I keep that money busy? Cause the investors invested in you wanting to put their money to work. Right. So one, like how do you keep it busy? And two, and I’m sure you can probably write the rules for this, whether, whether you can attract investors or not is like, do you have to pay? Are you paying them even if the money’s not busy? Yeah.

Devin Robinson (17:06.598)
Mm-hmm.

Yeah.

Devin Robinson (17:20.378)
Yeah, that’s a great question. So there’s a couple of different ways that you can do this too. So you can create your funds to have an open and a closed date, right? So like if you’re saying, I’m going to raise capital for the next six months and I have a target, I have a target amount that I want to raise in capital. So let’s say you want to raise like 10 million over the next six months. Then what you could do is you can actually do soft commitments. So a lot of times you can raise that capital and soft commitments and only call it when so people can pledge a certain amount and they can sign

essentially like letter of a tense or subscription agreements that state, hey, I will I will commit this much capital or they’re saying soft commitment. So they have a soft commitment of committing this much capital whenever you want to call that for the purchase of that property. And so you don’t have to you don’t have to have it all invested. You can hold it in soft commitments and you can still have them in their soft commitments. Like you could say, hey, once we do this, you’ve signed that within the next 30 days.

you’ll have that money into us or you can have penalties. You can have all sorts of things in there. So you don’t have to actually have it all at that time. Now I have seen.

Mike Hambright (18:26.35)
Yeah, they can kind of essentially put in a deposit, right?

Devin Robinson (18:29.412)
Yeah, yeah, exactly. And and I have had.

Mike Hambright (18:31.8)
And then if they don’t deliver, they could forgo that deposit, I guess, right?

Devin Robinson (18:34.736)
That’s correct. That’s exactly right. So that that’s right because they’re taking up a space in your raised capital your allocation Yep, and so you’re counting on that capital if they don’t commit on it Then you can say hey This is the amount that we’re just gonna go ahead and take that because you didn’t now I have seen also people what they’ll do is they’ll they’ll kind of take money and Especially because there’s different models you can do you could do what’s called like fund-to-fund models and so let’s say a fund-to-fund is What it sounds like and this has become pretty popular now are these fund-to-fund models where?

Mike Hambright (18:39.862)
You counted on it.

Devin Robinson (19:04.07)
Let’s say because there’s typically three types of people in a fund. There’s a fund manager a capital raiser and a deal finder, right? So like let’s say I’m like, hey, I’m gonna go ahead and I’m gonna raise capital I’ve got these people who I’m gonna raise capital from there a bunch of doctors and I know that they’re gonna be able to give me money and I can say hey I can give you 8 % on the year and then I’m gonna go out and find a sponsor or find another fund that fits

the thesis of what I told these doctors that I’m going to raise at and then I’m going to go invest into them. So what I’ve seen people actually do is they’ve raised capital. They raised capital from their doctors, held onto that capital, put it into a high yield savings account at 4 % until they found the sponsors that they wanted to invest in. And so even just making that that clear, you can put that into a disclosure. You can put that into or or if you just kind of know how to manage that money and you’ve got a deal waiting.

and you know you’re going to invest into that deal, you can at least hold it in some sort of like high yield savings account at 4%. So you’re still not losing a lot. So I have seen people do that as well. So those are probably the two ways that I’ve seen for the most part. Because like, of course, when you collect capital, that’s when your interest like your your accruing interest at that point, as soon as you collect that capital, if you’ve told them their pref is at eight, their preferred return is at 8%, then they’re going to be expecting 8%. And if you’re doing quarterly distributions, or if you’re doing just depending on what type of deal it is,

Mike Hambright (20:04.536)
Right.

Devin Robinson (20:30.15)
and what type of like asset you’re investing into, they’re going to expect that. So then if you, so if you’re either holding it or, you know, have some sort of soft commitment or holding it into that savings count and disclosing that, you can, you can kind of make up the rules on that too, which is why I like a fund as well. So I hope that answers your question.

Mike Hambright (20:45.646)
Yeah. Yeah, yeah. Maybe maybe share a little bit on like, how clear investors should get on their fund. Is it just like, just put it in my pot and I’m going to make shit happen? Or obviously a syndication people know exactly what they’re getting into, right?

Devin Robinson (21:01.488)
That’s right.

Mike Hambright (21:02.55)
And there is, by the way, there’s a very clear asset behind it. mean, it may not be as simple as firstly, indeed, a trust like on a single family house, a multi-family might be, I mean, you could, theory, lose all your money. But let’s talk a little bit about the clarity that a fund owner should have.

Devin Robinson (21:08.902)
Mm-hmm.

Devin Robinson (21:13.413)
You could.

Mike Hambright (21:20.224)
so that people know, I mean, let’s be honest, there’s always people that trust in us. think they’re like, whatever you’re doing, I trust you, just go do it. And then there’s some people that are like, you know, I need a clear definition of what you’re gonna do with my money. like, how vague should you be and how specific should you be?

Devin Robinson (21:21.69)
Mm-hmm.

Devin Robinson (21:28.218)
Mm-hmm.

Devin Robinson (21:32.73)
Yeah, that’s right.

So there are, depends on the type of fund. if you are going to do, even if you’re doing a fund, the good thing about funds is that you can be able to operate, I want to it, not necessarily economy of scales, you can, but you can operate differently. So if you have a syndication and it’s that single asset syndication, your investors know exactly what it’s for. They know that address, they know the deal, they know what the pro forma looks like, all that stuff, then they can invest into that. You can do with a fund though, you can actually, create an overarching thesis.

So you’ve got a private placement memorandum subscription agreement things like that in your PPM. First of all, it’s got like 60 pages worth of risks. The IRS or the SEC requires you to put in there. But otherwise you’ve got hey, this is exactly what type of asset we’re going to be investing in. So typically a fund is going to be a one singular asset type. So it’s not going to have a private equity and multifamily or something like that. So it’s to be an asset type. But what you can do is you can say we invest into

Multifamily properties in the southeast of the united states so and that fit Within this cap rate that are within this many doors whatever that are class a class class c or value add whatever But you want you they do want it to be as specific as possible within that asset class if you are going to be So it just really depends as long that I would say most funds Most funds that i’ve seen stay within an asset class if they’re not going to be single like a singular property basis

Mike Hambright (22:59.17)
Yeah.

Devin Robinson (23:03.202)
And then you can kind of make it up, not make it up, but you can kind of be somewhat vague within that asset class because I have started funds for single family flipping in the southeast of the United States. And so like it says that’s what it is. And then we’ve talked about what the profits look like. And then we’ve talked about what our partnerships look like in there. So you can add that stuff as well. And so then that just goes on. You just got to realize, though, if you’re going to do something like that, it’s going to be more difficult. It’s way more difficult to raise capital from.

people that don’t know you in a blind pool fund because you’re kind of just like, Hey, trust me. And especially if you don’t have, yeah, yeah, yeah, that’s exactly right. Especially if you don’t have a track record for it. Now I’ve, I’ve been fortunate enough to fill up the blindfold, like, cause you can then, then you go, all right, well, am going to raise capital from accredited investors or non-accredited investors? That’s a whole nother part of the conversation that we might have time for. So like my very first fund, I filled up a

Mike Hambright (23:34.83)
Mm-hmm. Yeah.

Trust me, you don’t know me, but trust me.

Devin Robinson (24:01.158)
Blind pool fund of non-accredited investors filled it up to the 35 and we raised 2 million within like our first six months. And so like it was a really, really interesting and that was the first fund I had ever done. And so I’m really thankful that I was able to get a lot of that trust off the bat, but that is the hardest thing that you can do is to do a blind pool fund. It’s way easier to start with single assets syndications, especially if you’re going and trying to raise capital from people that don’t know you. Yeah.

Mike Hambright (24:26.934)
Right, right, yep, yep. So what are some tips and tricks on, what do you see investors doing wrong that raise money? Because we’ve all seen it. I mean, I know very specific people that I see post stuff sometimes. like, I don’t think that’s, they have the best of intentions for sure, but I’m like, I think you might have crossed a line there. We’ve all seen it. So what are some clear ways, basically just tell us how to stay out of prison.

Devin Robinson (24:35.6)
Cool, yeah.

Devin Robinson (24:44.614)
That’s right.

Devin Robinson (24:48.186)
Yeah.

Devin Robinson (24:52.74)
Yeah, great. Yes. So if you want to stay out of prison, if you are raising capital, so the SEC, which is the Securities and Exchange Commission, they were they put in they were put into place. like Grandma Sherline doesn’t get scammed out of her money by the tick tocker that has a big following and thinks he knows what he’s doing. And so what happens is the SEC separates people between accredited and non accredited investors. I always think of when I think of accredited investors.

Mike Hambright (24:55.999)
Yeah.

Devin Robinson (25:20.742)
I think of one two three either they have a million dollar net worth outside of their primary residence Or they make two hundred thousand dollars They make two hundred thousand dollars of income over the last two years and for the foreseeable future or jointly with their spouse make Three hundred thousand dollars over the last two years and for the foreseeable future If they qualify if they do one of those three things then they are qualified as an accredited investor

Non-accredited is anybody that doesn’t fit that and so the SEC was put into place to be able to help non-accredited Investors and just actually on it and honestly anybody to not be scammed and What some of the things that they’ve put in here is they say hey for the social media people out there Unless you have like a 506 C which means that you can market your fund and talk about some of the returns that you guys are giving and expected returns that you’re giving or

previous returns, then you cannot specifically state how much somebody is going to should be expecting to return on something. So like you can’t be like, hey, hey, I got this awesome deal. You guys are to get 10, 12 percent on this deal, blah, blah, blah. Unless you have the documents to back up the fact that you can you can market that, you should not be marketing that. So that’s one of the things that they will say that also will say, hey, you can’t have they categorize a security.

Mike Hambright (26:37.101)
Right.

Devin Robinson (26:45.592)
as anybody that passively invests money with you, passively, that’s a security. That’s what they’ll say. That’s a straight up security. And if you pull, now there are a little bit more, I don’t want to say lenient on some of that stuff, but like if you’re pulling money of passive investors and you don’t have the documents to support it, you’re definitely operating within like a securities or outside of the securities framework. so like you can go to, I hate to be like, you can go to prison for that, but you could go to prison for that.

Mike Hambright (26:52.579)
Wow.

Mike Hambright (27:12.876)
You get in trouble, yeah. Whether that’s a black eye or a prison or a white and black striped suit, know. Right.

Devin Robinson (27:14.222)
You could definitely get in trouble for that.

Devin Robinson (27:19.204)
And it and it depends on how much you’re doing it for it because like I’ve seen straight up people be like, hey, hey, Devin, I heard you do I do funds and stuff. They’re like, I’ve got two. I’ve got three friends. I’ve created a promissory note with them where I say, hey, if you give me this much, I’m going to give you guys eight percent on your money. And they wire me the money. And I’m like, I’m sorry, they do what? And they’re like, yeah, they wire it to my LLC’s bank account. And I was like, hey, bro, that’s the security.

And they’re like and I was like you could go to prison and they’re like, ha ha and i’m like no no security like you probably need to talk to an attorney so that you can set up the right documents to get in order so that you are no longer violent and they’re like well What if what if my what if my title company holds it in escrow like security security?

Mike Hambright (28:00.93)
Yeah. It’s back to the real estate investor trying to make a find a way to make it work.

Devin Robinson (28:06.274)
Exactly. Like security. No, if the SEC will not play because you now have a fiduciary responsibility to act in the best interest of that person’s money. And if you aren’t disclosing all of the risks, if you aren’t putting together the documents, if you’re not and I’m not saying this is not a requirement, but like if you’re not auditing your financials and giving those and like reporting, you’re not you’re not we don’t even talk about this blue sky filings like all of these different things that come into play when you need to actually when you’re operating within securities.

You can go to prison like that’s that that’s that’s just what it is And so it’s really interesting to see that. not interesting. I see it all the time, unfortunately

Mike Hambright (28:42.52)
Yeah, Yep, yep. Well, we could probably talk for hours here, but I do wanna, one thing I wanna make sure we cover is, what trends do you see? like, what’s kind of going forward for, I mean, here’s what I’ll say. I started real estate investing in 2008, and there’s been a lot of…

Devin Robinson (28:57.798)
Nice. Wow.

Mike Hambright (29:00.462)
maturity in the market. Like I talked to probably a friend that you know as well here yesterday and it was like there were no CRMs in 2008, like zero. I mean it took years for there to be a real estate CRM. People were just bastardizing contact managers and spreadsheets and then eventually they, know, Podio came along.

Devin Robinson (29:09.722)
Hmm. Yeah.

Devin Robinson (29:17.158)
Yep, that’s right. You just what you said you were doing. I heard the podcast you said you were doing that you were on spreadsheets and stuff

Mike Hambright (29:24.438)
Yeah. yeah, no doubt. Yeah. I mean, we’re just doing whiteboards, like whatever Manila folders, like we had file cabinets full of Manila folders. I mean, it was it just is what it is. I mean, it’s just what it was, right. But there’s been a lot of evolution. And I think there’s been a lot of evolution in the maturity of real estate investors. So kind of from here on out. And you know, you see it now because we’ve talked about it is

Devin Robinson (29:31.077)
Mm-hmm.

Devin Robinson (29:35.301)
Yeah.

Devin Robinson (29:39.664)
Mm-hmm.

Mike Hambright (29:47.158)
It wasn’t that long ago and still today, the primary vehicle that people are using syndications or funds for is large multifamily syndications or commercial type properties, but it’s coming downstream to the the the Main Street investor, right? Yeah, right.

Devin Robinson (29:54.704)
Mm-hmm.

Devin Robinson (30:00.445)
Oh Man crypto people are starting crypto funds and this is where I think it gets really interesting because I in a lot of ways too I think that we’re gonna see a a decentralization of a lot of One I sec is not going anywhere. The government’s not going anywhere. But like the requirements I think especially since we have a more mmm, I guess real estate friendly real estate crypto Yeah

Mike Hambright (30:22.67)
Probably business friendly overall, yeah.

Devin Robinson (30:25.87)
President in the in here and like there’s gonna be a lot of different even just regulations are gonna get a lot leaner on kind of the the Regulations around starting funds. I think we’re gonna see some things change there And I think with the fact that there’s so much adoption in the crypto space I think there’s gonna be a natural progression to a lot more adoption in the blockchain space and I think with blockchain technology comes a lot more proof Than honestly and a lot less human error. So I think you’re gonna see

a lower barrier to entry to get into funds just in general because of like smart contracts, things like that. I could see something like that happening. I’m huge. I’m like massive on AI and the adoption of AI into everything that I do. And so I’m an early adopter on every AI thing that I see. And so I even have the meta glasses and I had them three years ago. So like massive adopter on these things. And so. Yeah, yeah, they are.

Mike Hambright (31:04.931)
Yeah.

Mike Hambright (31:19.47)
Are those cameras? I literally thought earlier, Alex, those are like first little cameras there. Yeah. Are you recording us right now on this?

Devin Robinson (31:23.95)
No, it’s only like three minutes at a time. so but it’s crazy because like this takes the best videos for me and my kids I can look at a poster and it will translate that poster to me and like spanish or english or whatever language it’s in I can ask it questions. It’s crazy. I I hate I probably won’t be one of those that like brain chips, but i’ve thought about it, but like, I don’t know that’s a little too far so but but i’m kind of like anything that would allow me to be more efficient and effective in whatever i’m doing

Mike Hambright (31:35.776)
wow.

Mike Hambright (31:46.038)
Yeah, yeah.

Devin Robinson (31:53.434)
I will leverage it and I will say that I think that the blockchain technology and even just like artificial intelligence is going to make the barrier to interest and entry into funds into things like that a lot easier. And you see the emergence of crypto funds coming in within the last couple of years. And I think there are a lot of people doing crypto funds really, really well. Well, I mean, like, look at Michael Saylor, like that’s essentially what that is, just a massive crypto fund. So there’s so many of those things that are coming in that I do see an evolution of.

Funds specifically in that way, and I don’t know if you’re asking for real estate But I do see and that does like tokenization of real estate is also very fascinating to me So there’s a lot of that stuff that I do see coming Yeah

Mike Hambright (32:29.506)
Yeah.

Yeah, that’s awesome. That’s awesome. Well, I wish we had more time to cover a lot more, Devin, but if folks want to learn more about you or how to set up a fund or any of those things, like where can they go to learn more?

Devin Robinson (32:37.19)
You

Devin Robinson (32:43.834)
Yeah, so I have of course you can always go to Instagram Devon Robinson one but even just for you and your listeners if they want to be like really compliant on raising capital and even just some tips on So the different type of structures different type of fund types people that they can raise capital from and some raising capital tips We put together a quick little one-on-one course for you and your listeners and they could just go to we are fund founders comm Backslash fuel so we are fund founders

dot com backslash fuel. yeah, man.

Mike Hambright (33:14.67)
Awesome. Cool. Well, I appreciate you for joining us today.

Devin Robinson (33:18.682)
Heck yeah, man, I appreciate you having me. Thank you. This has been fantastic.

Mike Hambright (33:20.578)
Yeah, yeah. I think for those that are listening right now, mean…

Guys, if you’re a real estate investor and you see the opportunity to scale your business up with more funding, mean, this is something you should definitely consider. A lot of times we’re hamstrung by not enough capital or not easy capital to get to, and this might be a way for you to kind of take your business to the next level, and most importantly, be able to have a bigger impact on the world, the things you might kind of be able to do with your business. Your business can fuel your kind of destiny, right, and impact a lot of other people. So, Devin, thanks again so much for joining me today.

Devin Robinson (33:35.61)
Mm-hmm.

Devin Robinson (33:43.93)
Yeah, That’s what it’s about.

Devin Robinson (33:50.842)
Right. Hey, thanks for having me. Appreciate you.

Mike Hambright (33:54.178)
Yeah, awesome. And everybody have a great day. We’ll see you on the next show.

Devin Robinson (33:56.901)
Yes, indeed.