Raising Capital and Private Money

By Fuquan Bilal

People often think that raising money is the most challenging aspect of the note business when in actuality, once the fundamentals are established, finding money is the easiest part. Raising capital whether you know or not is heavily influenced by credibility, reputation, and strong marketing. If you want to keep generating cash flow, never stop raising money and never stop marketing. Getting involved and networking are little things that make a big difference. There are many ways to raise capital, from investors to partnerships, and to make note purchases.

When working with investors, strive to go out of your way because the way you treat them directly affects your capital. Your reputation will precede you. If you pay on time, keep your word, and display responsibility you are showing strong qualities that will make positive impressions on people and especially investors. Investors want to invest with the people they feel they can depend on, trust, and are comfortable with. Therefore, building strong relationships is critical and fundamental in the note business. How you market yourself to other target audiences is also critically important. Sell more than just interest rates and show that your company, or even you, is exclusive and different.

Asset building isn’t just accomplished through single purchases. One can also build collateral by creating partnerships and forming an LLC. In forming an LLC with partners, each person can put x amount of dollars in and then go out and buy notes with the money. Since note buying is a capital intensive business most note buyers start off on a smaller scale before going into pools. The benefits to loan level buying include the ability to cherry pick and purchase equity deals. Loans with equity are usually priced at a premium but are considered to be “safer.” In due time and with experience you’ll find more loans and more discounts and will be able to buy pools, of which you can choose high or low equity for example. Time and experience are barriers to entry on large trades mainly because banks want to unload pools to reputable servicers that can show their history in the business.

Find out more about investing in secured debt and real estate, go to NNG Capital Fund

Fuquan Bilal

Fuquan Bilal founded NNG in 2012 with the principal mission of capitalizing on the growing supply of mortgage notes in the interbank marketplace. Mr .Bilal utilizes his 17 years of residential and commercial real estate success to identify real estate opportunities and capitalize on them. To date, he has successfully managed three private mortgage note funds that primarily invest in singlefamily performing and non­performing mortgage notes. His financial acumen and proprietary set of investment criteria enable him to purchase underperforming real estate assets at a deep discount of face and market values, thereby increasing the value of the assets. This, coupled with his ability to maximize the use of leverage, enables him to build strong, secured portfolios with solid passive income flows.