How to start a passive investment business in real estate with Alina Trigub – AEP #9

00:01

Ramesh: Hello everyone, welcome to the Agile Entrepreneur Podcast. This is your host Ramesh Dontha. This podcast is about starting and running your own business with purpose, passion, perseverance and possibilities. Today we have a guest from the real estate industry. Her name is Alina Trigub. Let me introduce Alina. Alina is the founder and the managing partner of Samo financial. It's a boutique private equity firm specializing in helping select group of people passively invest in the commercial real estate. Alina is the founder of two meet up groups name the power of passive investing through real estate. Which gather in New York and New Jersey. Hi Alina welcome to the podcast.

00:58

Alina:  Thank you Ramesh, great to be here. Thanks a lot for having me.

01:01

Ramesh: It's fantastic. So, let's start with the name of your business, Samo financial. Why Samo Financial? How did you come up with the name?

01:11

Alina:  Sure. So Samo is the initials of the first name of my family members. It's my two kids, my husband and myself. So that comes to Samo and my name is certainly part of it as well.

01:23

Ramesh: Oh fantastic, that is really a very personal touch right off the bat. That's great.

01:27

Alina:  Absolutely.

01:28

Ramesh: Alright. So yeah why real estate and why did you start this company?

01:35

Alina:  So my journey in real estate started about five, six years ago. I was always interested in real estate. But never really took a serious action and my concerns for many years have been how to diversify out of Wall Street. All of our investments for my husband and me have always been in stock bonds, mutual funds. Whether its through 401K or regular brokerage accounts and I always wanted to diversify into something else and real estate was one of those components that I wanted to diversify into. So finally, I took an action about six years ago and started doing my research and after doing significant research, I came across the world of so-called syndications in real estate and I can give you a more or less a definition if you'd like me to explain to your audience, what syndications mean.

02:31

Ramesh: Please go ahead. Because I don't know the syndication. I don't think many of the listeners would know right off the bat.

02:37

Alina:  Sure, sure. Syndication entails that a group of people pulls money together to buy a large commercial real estate. Which is exactly what I decided to join in. In this group it's normally done through a partnership and in the partnership, there are general partners, people that do all of the work. Find the property, negotiate, inspect, renovate, find tenants and so forth. And then the other group, the majority of partners, limited partners which are the people that put their funds together and just reap the rewards of being completely passive in that syndication. And that's how I started being completely passive investing in real estate, while someone else was doing all the work and reap in the rewards. After realizing those rewards for several years, I thought that it was a great way to make passive income and I wanted to spread that word and share it with other people. Because syndications are done through private placements. So very few people hear about this concept and even know that this is available. While it's not only it's a way to diversify out of Wall Street. It's also a way to save on taxes through real estate and it's also a way to create residual income and out of this the idea of my company, Samo financial was born and I started my company roughly a year and a half ago where I’ve been spreading the word and helping people to become passive investors and get on the path of creating and building wealth for their families and generations to come.

04:11

Ramesh: So, your target customers are the people who want to invest in real estate through the private equity firm that you own?

04:18

Alina:  Correct, correct. People that either don't have the bandwidth or don't have the desire to do anything actively, but eager to diversify out of Wall Street or into real estate. This is perfect for them. Because again the amount of work is limited to reviewing the offering. Just you know going over the paperwork and that's it. After that the work is done. If they really like the offering, they invest with us and start reaping the rewards through dividends and capital gains and tax savings as well.

04:51

Ramesh: So, you and your company goes and finds the real estate and then vets them and goes through the due diligence. Is that right?

04:59

Alina:  Sure. So real estate is a team sport. We have a lot of partners that we were able to establish over these years, while starting as passive investors and then become an active in the space. So, I work with a lot of experienced partners that have been around real estate for decades and sometimes longer and that run the space and know their asset classes really well. So, we select the partners first, then we select the market and then we select specific deals that we go in and bring our audience into the deals. Only the deals that we personally believe and with my background to former tax accountant and my you know MBA in finance, I feel like I have enough credibility to evaluate the deals and decide whether the deals are good enough for my investors and myself.

05:51

Ramesh: So, you started talking about your personal journey, so let me go there. So, you wanted to diversify. That was the problem you're trying to solve for yourself and that's how you got into it. Did you think about starting your business for a long time and got into it? Are you somehow accidentally got into it because you're trying to solve the problem for yourself?

06:12

Alina:  It's more of the latter. I was trying to solve the problem for myself. But then when I finally solved the problem, I realized the huge potential of real estate and I wanted to spread the word among other people. I really wanted to help other people. It's more or less my moto for those that have my business cards, they know it's actually my business card. I live by the words of the Warren Buffett wrote, which is someone is sitting in the shade today, because someone else planted the tree long time. So that's what I’ve been working on ever since I started my company. Just spreading the word and helping people get into passive investing and reap the rewards of passively investing in real estate.

06:54

Ramesh: So, it's a year-and-a-half journey you said. But you've been working in this area for longer than that. So how was this one, I mean year and a half, 18 months? From get go were you successful or you had, you needed some time to get your feet on the ground? Can you talk about that journey please?

07:13

Alina:  Sure yeah, it’s a lot of effort. It's a 24/7 operation and you know I still work full-time. So, this is in addition to full-time job.

07:25

Ramesh: Oh, is that right?

07:26

Alina:  Yeah and I have a family as well. But you know I'm still, I was and I'm still very very passionate about this topic. I'm very passionate about helping others. I love what I'm doing. I like the investing style and that's what keeps motivating me and pass my why. I think it's absolutely critical for anyone going into any kind of business to know their why. If they know why they are doing the business, that will keep them going no matter what and just like everyone else, you know I had obstacles on way and there are challenges that I need to overcome you know on a regular basis. It's normal part of the business. That's how businesses grow if you are starting out from scratch, which I did. But I don't mind the challenges and the obstacles. I find a way around it and I move forward and like I said real estate is a team sport and I appreciate the help and support of the people that I’ve met throughout my journey ever since I started investing, even passively. I've met a lot of great fantastic people along the way and without that support and help of my family and all these new friends that I acquired, I wouldn't be able to be where I'm at today.

08:41

Ramesh: Actually, you're bringing a very interesting subject. So, you have a job. But many times, the people who want to be entrepreneurs, so they ask me you know how do you find the motivation and drive? So, when you have a job, you have family, so this is on top of all that stuff. So where are you getting the drive from? Why you want to do this?

09:03

Alina:  I'm doing this for my family. I'm a first-generation immigrant and I’ve gone through a lot of challenges when we immigrated to the United States. I was always working while getting both of my degrees, undergraduate and graduate ever since I remember myself. Actually, when I was getting my MBA, I was working full time. I was getting my MBA and I was pregnant with my first child. So, the drive has been there all along. You know I had to kick myself more or less hard to get started. So, I’ve always wanted to start my own company. I just didn't know what it would be and finally after reaping the rewards of being a passive investor in real estate syndications, I realized that this is the business I want to be in and I don't regret you know any minute of it. I completely enjoy what I'm doing. It's phenomenal. I do still get challenges on the way. But like I said without challenges, it wouldn't be as exciting as it is.

10:04

Ramesh: Right. So, I mean definitely your personal Drive comes through very clearly in your conversation. Apart from that other people who helped you become successful? Did you have mentors who either gave you a break or you know helped you continue this drive?

10:25

Alina:  Yeah absolutely. So, number one I have a support of my husband while he's not in the business with me. But he's been supportive of me starting a business all along and you know I give a lot of credit to him and my family overall. Without him I wouldn't be able to be where I'm at today. I did have mentors and close friends that I call mentors and it definitely helped me progress through the challenges and get through them and escalate my business to the level that it's at today. So yeah that definitely was a huge help.

11:05

Ramesh: This industry I don't know if it's some close-knit kind of a community. Because some industries are right. It's difficult to break through. I don’t know if this is or not. But I just want to ask you I mean what kind of barriers did you face. Whether it's gender barrier or other you know kind of things. So, if somebody were to get into this kind of a business what should they be expecting?

11:29

Alina:  Yeah gender barrier was absolutely there. I mean I am in New Jersey close to New York City. So, a lot of the events that been taking place that I go to are in the city and you'll see that the commercial real estate industry is dominated by white middle-aged male and I do not feed that profile at all. So, there have been barriers and even if I go to some local events, I’ve been confused for a realtor and I have to explain every time, no just because I'm a woman I'm not a realtor. You know I do other things that are way beyond being a realtor. The barrier is there. But if you don't pay attention to it, if you just ignore it, it allows you to move forward. It's not something significant in my eyes to concentrate on to pay attention and if you want to succeed in this business. And the minute I started ignoring it completely, it escalated me to the levels beyond. Because at the end of the day you know you need to be dealing with these people that are saying that and just because they said that, it's you know it's an honest mistake. So, it’s totally fine. The minute you do look beyond it, you open up a lot of doors and opportunities for yourself and that's how I look at things. You know I want to have partnerships and joint ventures and I want to grow and expand my business and help a lot more people that I have helped up until this point. And in order to get to that level I need to be open to deal with the folks around me.

13:08

Ramesh: Hey Alina so let me ask you another question about your business. You've been in this business for a year and a half. So are there any numbers that you can share in terms of I don't know a number of apartments, whatever you do in the space.

13:24

Alina:  Absolutely, absolutely. So, at this point we have helped our clients to acquire and invest in multiple asset classes and just to give you a quick background on it, I started investing in commercial real estate by investing in apartment complexes just because multifamily is close to home. I've lived in apartments for a long time, I knew how to evaluate it. I knew what that asset class entail and everything and it's very common for lot of folks to start in the same space. But then gradually I realized that there was a demand of diversifying. Asset classes and after doing additional research, I added two more asset classes to portfolio. Which is storage units, which are also very very conservative by nature and do really well during the recession's and mobile home parks. Again conservative, a lot less expenses, no plumbing expense. And because of the significant slashing expenses do really well in general and do better than other asset classes during the recession. So, at this point for help our clients and our self invest in over 1200 apartment doors in over 500 storage units and we invested in over five million dollars of fund that's focused on mobile home parks.

14:43

Ramesh: Okay so how do you make money in this process?

14:47

Alina:  I make money by working on the Investor Relations side. Being the investor liaison. I help investors understand the process. I help them get acclimated with what it entails. I explain them how the investment works and then once they join us and partner up with us as limited partners, I help them understand what we're doing. Provide the updates to them, offer help and they need help with their self-directed IRA accounts and any questions really about the investment are going through me.

15:23

Ramesh: I see, okay so what are your plans going forward? Like how are you planning to grow your business? Are the growth is sufficient for you to handle that you just want to sustain and maintain?

15:37

Alina:  No, I definitely plan on going. At this point and you know the plans normally change as you grow. At this point I'm planning to grow my private equity practice even further by growing investors base on one end and on the other end, I'm planning to add additional asset classes to our portfolio. Like for instance right now I'm researching the residential assisted living space to potentially add to our investors and our portfolio in the future and bring new partners and bring new experienced operators in. So, investors can diversify even further outside of the markets and we're right now investing nationwide and invest in other markets that we haven't invested in.

16:23

Ramesh: So, one of the questions I keep getting asked is like what kinds of tools do people use in their businesses. So, what are the tools that you use in your business?

16:32

Alina:  Sure, without the tools I wouldn't be where I am at today. One of the critical components for me is my CRM system and I'm using pipe drive. I find that very helpful. It works really well in combination with the email marketing tool, which is MailChimp and that's what I'm using right now. Obviously, Gmail is used to communicate with my investors in general and then there's a whole bunch of things that are used on the real estate side that you know I'm not going to share. But as far as like generic side, generic tools, I would say those are the main components and very very helpful for any sort of business. You definitely need the system and you definitely need an email marketing tool that you use.

17:25

Ramesh: Okay so now I'm a listener. I want to start my own company. So what tips can you offer me? What should I be thinking about in doing?

17:37

Alina:  The first step that I would take is, I will get an attorney and accountant in the room together with you and help you determine who is the best structure from a legal aspect from you know safety perspective and then from a tax perspective and how the two works together. Because those two don't always align and you hear one thing from accountant another thing from attorney. So, I would say speak with both of them together and determine what's the best structure for a company. Set it up, set it up on the federal level, then on the state level to be efficient. Get your website up and running, get your business card and start getting your presence by building your leadership platform by providing value to people and you know not charging for it. But providing value for free, so people can see that you're the authority in the space. You're providing value and they can reach out to you if they have any questions you know to you in the particular space that you're in.

18:42

Ramesh: Great actually that's a very good advice about accountant and lawyer thing. That's very good. The last question. So, looking at your own journey, are there anything that you think you could have done differently if you were starting your entrepreneurial journey today?

19:00

Alina:  Yes, I wish I started a long time ago. I strongly strongly encourage everyone to try out things a lot early in life. You know when maybe you don't have dependencies, or you don't have a family, or you know if you think you know starting something out, even if it's on the side out of your garage or whatever, start that out, give it a try. Because later in life you're going to regret. So always start and when you are starting a business, always always you must have a strong why. Why are you doing it? Why do you want this business? Without a strong why you will not be able to succeed and move forward. Because any business no matter what business you're in, will have obstacles on the way and some are going to be much stronger and much more significant than others and in order to succeed, in order to get up every morning and decide that yes, I want to continue with this business, you need to have a strong way that will help pushing you forward in the right direction.

20:01

Ramesh: Alina thank you very much. Actually, I’ve learnt tons of stuff about this real estate industry and then the kind of operations that you run. Thank you very much for your time.

20:11

Alina:  Ramesh it's my pleasure and thank you so much for inviting me to speak to your audience and to you.

20:17

Ramesh: Great thank you.