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Show Summary
In this conversation, John Casmon shares his journey in real estate investing, emphasizing the importance of intentionality, mindset shifts, and the value of education in raising capital. He discusses overcoming limiting beliefs, the significance of building a network, and how to provide value to potential investors. The conversation also highlights the role of confidence, credibility, and connections in successful fundraising, along with resources available for aspiring investors.
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Investor Fuel Show Transcript:
John Casmon (00:00)
I literally hired him and I did not have this grandiose expectation of building one hundred and fifty million dollar portfolio. But I did want to say, hey, if I buy a 12 unit, can I just bring half the money instead of having to save all of this?Kristen (01:45)
Welcome back to the Real Estate Pros Podcast. I’m Kristen and I’m here with John Casmon who is a real estate investor with over 150 million dollars worth of apartments. He hosts the Multifamily Insights Podcast and is the co-creator of the Midwest Real Estate Networking Summit. So I’m excited to get into it. Thanks for being here John. So let’s get into your background. You have a really interesting path into real estate.John Casmon (02:01)
Yeah, thank you for having me, Kristen.Yeah, you know, like many of your listeners, I was in corporate America, worked a W2 job. Unlike, I guess some of your listeners at least, I really, really enjoyed what I was doing. I know some people hate their job and wanna leave, but there are a number of people who actually enjoy what they’re doing, and I did. I was working in advertising and marketing. I enjoyed the campaigns I was working on, the projects I got to do. However, I was working at General Motors back in 2007, 2008, 2009.
And if you recall, that was a time where we ended up going into bankruptcy. The overall economy suffered. And I watched a lot of my peers go through a very, very rough layoff situation where a number of folks who were lifers, they had only thought of working for this one company, found themselves with no employment. And I remember in particular, there was a gentleman who sat kind of kitty corner from me and he got let go and he left a voicemail to everyone on the floor. And it was heartbroken. He was
just distraught and he really didn’t know what to do. And I just remember listening to that message and two things crossed my mind. One was a great deal of empathy for him and the situation he was dealing with. But also I was pretty young in my career and I realized I never wanted to be in that situation. So I started thinking about a plan B for myself. Real estate became that plan B. Fast forward to Moody Chicago and I’m working at advertising. My wife and I buy
two unit building, so we’re starting a house hack. We buy a three unit building that’s going well. And then I’m trying to figure out how to scale this portfolio. I end up buying an eight unit building, but this was all of my savings. And in buying that property, I realized what I was doing was working, but it wasn’t working because I would basically save up, buy a property, be right back to being broke. So I need a new strategy. And through, you know, a little bit of luck, a little bit of persistence.
I ended up finding somebody who became my mentor and that really opened up the doors to me building a bigger portfolio.
Kristen (04:09)
Yeah, I think that’s really important to mention. It’s so hard to do it yourself. I mean, real estate investing is often a solo sport, but it really is great to seek out those mentors. How did you find a mentor?John Casmon (04:22)
Well, was, you know, really, I had a hard time finding deals in my market that were making sense. And one of the things that helped me tremendously was being able to understand market, market dynamics, trends, and those trends started to shift and change. So I started looking out other markets and in particular, let’s start looking at Cincinnati. My wife is from Cincinnati. I knew at some point we would be moving to Cincinnati. So I was let me just get a jump on and start looking there now. And as a part of that process,I was trying to connect with other Cincinnati investors and I made a post on BiggerPockets saying, hey, I’m coming to Cincinnati. Not like anyone cared, right? But I’m like, I’m coming to Cincinnati and I’d love to meet with some investors. If anybody’s open, let me know.
And about four or five people tagged this one person. So I reached out to the person that was tagged and I told them, hey, I made this post. Four or five people tagged you. Would you be open to meeting?
And a responder said, sure, let’s grab lunch this day. Cool. So we had lunch. And that person told me that they had a coaching program and they had done a lot of things that I was looking to do. And I thought about it for a little bit and made the decision to hire them. And that really changed the trajectory. And a couple of things happened. You know, I skipped over a really important part of the story, but that eight unit I bought when I was trying to figure out my strategy, the second company I was working at,
also went into bankruptcy. And this was very different because this is a smaller unknown agency in Chicago. And I recall like it was around late November, right after Thanksgiving. So it was like that week in between Thanksgiving and Chris or in a start out the week. But it was like the week after Thanksgiving, so that first week of December. And. This company is going to bankruptcy, and I remember asking myself.
like how I allowed myself to be back in this situation because the whole reason I started investing in real estate was to have a plan B for this situation. And while I had real estate, it wasn’t generating enough cash flow to completely offset my W-2 job. It didn’t have everything that I needed to be able to walk away. And I didn’t have as much savings in my bank account to just keep buying properties. And I remember going to a, I was listening to radio one day.
And there was an ad for one of those like, you know, mastermind type things. And this one’s for like guys on HGTV. And I go out, they do a great, you know, spiel the first day where it’s free, I think. And then you go and you pay two ninety seven. And I remember really thinking about writing a pretty hefty check. And I was sitting there with my wife. And as we talked about it, we realized we could use help and we could use some guidance. But.
that program in particular wasn’t the right fit. And coming out of that, we decided, you know what, let’s be more resourceful. And the moment I was I realized, OK, if I’m willing to spend 20, 30, 40 thousand dollars on some sort of mentorship or coaching, then certainly I’m willing to sacrifice some time and some education to get the results out of this. So I think that really created a mental shift.
where I started to be more intentional about my actions. So even that post on bigger pockets about meeting someone that wasn’t that was very intentional. I wasn’t necessarily looking for a coach or mentor, but I did know that I needed to meet with local investors. And through that, I got a coach. And my lesson there is when you are intentional about what you want, the right people will show up to help you get it. But you have to have that clarity. You have to be willing to pay the cost. You have to be willing to invest. But ultimately.
you have to decide and take action. And I find a lot of investors want to grow their portfolio. They want to get more real estate, but they don’t decide and they don’t take action. There’s a very big difference between making a decision and simply wanting something to happen. So that decision was really critical in order for me to grow and move forward.
Kristen (09:20)
Yeah, it’s kind of also that analysis paralysis. I feel like some people get so caught up in learning that they forget to actually do it. ⁓ And there is that fine line because you need to learn before you do. And so what was really that turning point when you felt like you were spinning your wheels to when you started actually feeling like this was actually something viable?John Casmon (09:42)
Yeah, it’s interesting, right? ⁓ when I was investing before, it was working, right? So I was making money, those properties were appreciating. It just didn’t help me get to my goal, which was to live independently of my W-2 job, right?So I had to step back and come up with an investing strategy that didn’t rely solely on how much money I had saved. So I had heard of this strategy of raising capital or other people’s money.
But I didn’t think it was right for me. I mean, the reality is I’m the first and only person in my family to go and graduate from college. ⁓ I didn’t have rich friends. And if I did, they certainly didn’t tell me they were rich. So ⁓ I didn’t have the network to raise capital. And if I did have the network, I was struggling with my own money. Like I didn’t think people would trust me and want to invest with me. So I had a lot of these thoughts in my head, like I can’t raise money. Like why would anybody invest with me?
Kristen (10:58)
Okay.John Casmon (11:15)
And then I came across a really good friend of mine who she had a meetup group and I would always attend the meetup. So she and I got to know each other really well. Well, she went from three units to nine units to nine. Then she went from nine to 90. And I remember being just floored, like how in the world you go from nine to 90 units in like, I don’t know, six month timeframe. So I took her to breakfast and I asked her and I remember in my head, every solution or answer that she was going to provide.was someone gifted her all this money. And when I finally asked her, she said, no, I these investors in California who came across me online and they wanted to invest with me. I was like, what? And she was like, yeah. And I’m like, that really happens. So I think that seed was planted. And then my mentor, had raised a million dollars for his first deal. And again, I didn’t know anybody who raised money. So now I’ve got two people who have done it.
Kristen (11:55)
Yeah.John Casmon (12:11)
And it started to become real.I literally hired him and I did not have this grandiose expectation of building one hundred and fifty million dollar portfolio. But I did want to say, hey, if I buy a 12 unit, can I just bring half the money instead of having to save all of this?
And that I mean, that mentality just started to shift. And then I watched what he was doing and I started to implement some of those techniques and strategies. And, you know, I think the next deal we ended up doing now was about a year later. But the next thing we did was one hundred and ninety two unit apartment community.
and we raised as a total unit $6 million, I personally raised around just under half a million dollars. So for someone who has never raised a dollar for anything to go to raising almost a half a million dollars, that was an incredible leap for me, but it did require, again, building the right team, but also kind of shifting my mindset on how I approach the business.
Kristen (13:04)
Yeah, I think mindset is huge in that because they think a lot of people, I mean, the answer is always going to be no if you don’t try. ⁓ What were some of those techniques that you learned in ⁓ fundraising? Because I do feel like that’s athing that a lot of people are held back from.
John Casmon (13:21)
Well, I think the biggest thing and this took time, even when I was in the process, it didn’t really click to me until we kind of completed that first raise. And one of the investors said, thank you. And it kind of caught me off guard because I was going to thank him. And it made me realize that we really provided something of value to them because this was an individual who wondered everything we were pitching. Right. So cash flow, appreciation.depreciation for the tax benefits, right, to be in a diversified asset and not have all this money tied up into the stock market. We provided that. And by the way, this person didn’t have to do the property management. They didn’t have to be a landlord. They could just invest and earn passive income and get all of the benefits of owning real estate without any of the headaches of being a landlord. So when they said thank you, it finally allowed me to step back and stop looking at it from my own lens, which was.
I need to raise all this money to do this deal. If I don’t do this, this is gonna happen. And that was kind of the thing, right? So once I stopped and realized the real value I was providing for this individual, I realized that it was a service. And when you treat it like a service and you know you’re helping people, it alleviates the pressure that I was putting on myself to perform and execute. Because when you go to people, especially your friends and family, you’re putting a lot of your own identity.
into these conversations. I mean, it’s one thing if some stranger across the world decides not to invest with you. It’s something else when like your best friend shoots you down and says, nah, man, I don’t want to invest with you. It’s like, why do you think I’m stupid? Do you think I’m going to fail? Do you think that like we just start to fill in a blanks with like all of these things that we don’t even know if they think about us. But like we just we just start making up these stories, write these narratives. And I think that’s the hardest part when you’re raising capital is.
When you’re brand new, you equate a lot of what other people think to how they feel about you. And sometimes you have nothing to do with it. It could be they don’t understand the investment, they don’t like real estate, they think it’s risky, ⁓ maybe they would like to see you more seasoned for sure, but it sometimes has nothing to do with you. A lot of times it’s just about them and maybe their own ⁓ knowledge of the space or their own.
knowledge of investing or their own connection with money and investments in general. a lot of it really comes down to teaching people. I think that’s the biggest thing I took away from my mentor was don’t worry about raising capital, focus on educating people in your network. If you can teach people what you’re doing, why you’re doing it, how you’re doing it, that’s gonna get them comfortable. And the best example I have is that deal I mentioned, one of my really good friends, him and his wife invested in that deal.
and they have since gone on to invest in other projects themselves from Airbnbs to you know, like a what do you call it? The crypto mining. So they’ve got like a crypto mining thing they do now. And it’s just amazing. And they credit me for giving them the opportunity to invest in alternative assets as the spark for them to continue down that journey. On the flip side, I have another good friend. So we’re all same friend couple groups and they did not invest in that deal.
As a matter of fact, I did about 10 other deals that they didn’t they didn’t invest in the first nine, but they did invest in the 10th deal. And it kind of caught me off guard because I didn’t even know that he was still listening to my podcast and checking out some of the content I was putting out. And he reached out one day with a question based on an interview I had. And he was like, hey, what did you mean when you said this? I was like, oh, I won. Thank you for the feedback that I should clarify some of the stuff we’re talking about.
Two, had no idea you were paying attention to this stuff still. And three, hey, like, why are you still paying attention to it? Are you considering investing? Do you have like something else going on? Well, he ended up investing in three of my last four deals. And it goes to show that everyone is on their own journey. And I go back to this notion of service. That’s what it was. If I equated my value or anything tied to him and his decision.
Kristen (18:02)
Mmm.John Casmon (18:15)
then that would have been dead on that situation, right? The first time they declined to invest, but it’s not about that. It’s about me being someone who can educate the people in my network, and if they want to invest, if they’re ready to invest, I’m here as a resource. But it’s not my obligation to make them invest, it’s not my job to convince them to invest. In fact, I don’t want to do that, but I do want to educate them of why I like investing, here’s what I look out for, here’s our strategy and our criteria, and I help them get comfortable with making better money decisions.And I think that’s really important because it gives me a greater purpose. And if you have a greater purpose of what you’re doing and why you’re doing it, you’ll do it more emphatically. If I was only focused on, I want to raise $100,000 to do this deal. Well, if I got that deal done, let’s say I do get it. I’m probably going to stop right there. Right. All right. I accomplished the goal.
But if you have a vision, a purpose, a mission that’s bigger than you to help.
other people learn how to take control over their financial future through real estate, through passive investing. That’s a bigger calling and that can fuel you to do things that are above and beyond what you otherwise might go out and do.
Kristen (19:25)
Absolutely, I mean think you hit on such important points and I think going after people and just wanting money is off-putting, right?John Casmon (19:33)
Very much so and they can smell it, you know when you come off as desperate and especially if you’re like, you know, you you need to raise another quarter of a million dollars or something like that and You’re really hoping that person invest like Kristen if I called you right now and I’m trying to pitch you this deal But in the back of my mind is like boy. hope she says yes, because if not, I’m screwed right like that Tensions gonna be there and you might not know exactly what’s going on But you’re gonna know you’re uncomfortable and you’re you know, your spidey sense is gonna tell you say no and and I think that thatHome confidence comes from preparation. So I tell investors that, if you’re going to raise money, you’ve got to follow the three C’s, all right? The three C’s you need to raise capital is one, need confidence. Confidence comes from preparation. OK, you got to know your stuff. You have to be prepared. You got to know what you’re doing. You have to know the deal. You have to know the market. You have to be able to anticipate the questions that you’re going to see. First, see his confidence. Second, see his credibility. What have you done that you can lean on that
gives you the credibility to go out there and execute on what you’re saying you’re gonna do. And if you’re new, that’s okay. You can lean on your other professional experience or, and, build a team that has the credibility and the experience executing the business plan that you’re looking to do. But you have to have credibility if you’re gonna go out there and raise capital for deals. And then lastly is connections. You have to have the relationships. You have to have the network. And you wanna find people who are looking for this unique opportunity.
One of the biggest mistakes I see people make is they rely solely on friends and family. And the truth of the matter is your grandma and your cousin Pete are probably not real estate investors. This is not the thing that they’ve been waiting on a solution for their entire life. So when you go to Pete and you say, hey, I’ve got this great deal, he’s like, okay, good for you. And you may feel discouraged, but the reality is Pete’s not looking to invest. Now, if Pete on the other hand,
has a tax issue, he’s been trying to figure out how to get his money out of the stock market, he’s been thinking about real estate or he tried real estate but didn’t really like being a landlord, Pete might be perfect. But you’ve got to ask better questions and identify that. So instead of relying on Pete, what I suggest you do is try to use your network to expand your network to find the individuals who are looking for the right opportunity.
Kristen (21:55)
I love that. Well, this is all such great advice. I people probably have a lot of takeaways from this. Before we wrap up here, I would love for you to talk about your podcast, the Multifamily Insights Podcast.John Casmon (22:06)
Yeah, multifamily insights have been running strong for, I don’t know, eight years, I think, at this point. So well over seven hundred and sixty or so episodes. So ⁓ we sit down with multifamily professionals and we try to help everyone on their journey. So whether you are just starting out, whether you want to be passive and you decide, nope, I don’t want to deal with any of that. But I’m willing to put my money into it. We’ll give you some tools, tips and tricks to learn how to be a better investor. So check out multifamily insights anywhere you listen to podcasts.Kristen (22:33)
amazing. Well, thank you so much and tell everyone where to find you.John Casmon (22:37)
Yeah, listen, if you enjoyedwe put together a free guide. It’s seven questions you must ask before investing in apartments. You can get that at our website, casmoncapital.com/7questions. And from there, my contact information, all the other stuff is there as well, but just go to casmoncapital.com/7questions.
Kristen (22:55)
Thank you again, John. think this has been awesome.John Casmon (22:58)
Absolutely. Thank you for having me today.Kristen (23:00)
And thank you everybody for listening. Hope you got a lot of information here that’ll help your business. Maybe got some inspiration as well. So we’ll see you back next time.
