How To Automate Money Raising And Management With Jake Marmulstein

Today's Guest: Jake Marmulstein

Jake is the co-founder and CEO of Groundbreaker, an all-in-one investment management software built for real estate investment firms, fundraising automation software, an investor Portal, and investor reporting software. They exist to advance each customer’s syndication business. They envision a world where real estate investments are made accessible and efficient by digital evolution in real estate syndication. Preparing investment materials can be cumbersome, and handling investor relations has been done with cobbled-together solutions like spreadsheets, decks, file storage for documents, and email to help remove the pain points and allow investors to focus more on raising capital and finding deals. Managing data and answering to investors is a time-intensive, manual process. There has to be a better way, and Groundbreaker has it.

Highlights From The Show:

We begin the episode with Jake sharing his background story and how he ended up in real estate. Jakes shares that he was first interested in real estate development when he worked overseas in Brazil with the city government. Jake saw how the international companies were coming and installing research facilities and how the cityscape was changing rapidly. The country that had the highest GDP at the time and the process was very intriguing to Jake. He discovered that real estate and development meant more job opportunities and popularity. Jake started to work with a real estate investment trust, and that is where he got most of his real estate knowledge.

We then talk about Jake’s transition from underwriting to real estate syndication. He shares that his frustration came because he was handling administrative tasks that didn’t require much creativity. Jake had friends who were always looking at the next big opportunities in real estate. His focus was on how real estate companies could raise capital online and advertise opportunities to investors. At the time, few companies were offering portals where you could evaluate deals as an investor. From his analysis, Jake realized that there were independent real estate investors that wanted to raise capital, but they didn’t want to give investors their data through a single portal. They want to maintain the ownership of the intellectual property, and his goal was to provide them with processes and systems.

Next, we talk about Jake's software, Groundbreaker, and how it helps investors to raise money automatically. According to Jake, you create a deal in the system and send it out to your investors with Groundbreaker. They get to a private and secure portal where they can access and see your deal and download any document. Additionally, if you need to update anything, you can do it within the system as the deal changes. When an investor wants to invest, they put down the amount and can go immediately to investor verification questions and compliance. After verification, they can view the subscription remits, sign in electronically and then move on to funding either by getting wire instructions or linking their bank account to make payment. Jake shares that Groundbreaker is very safe. They record every single activity, and it automates every step to remove restriction points.

We then talk about the price of using Groundbreaker. Jake shares that they are still experimenting with different markets. However, the typical customer that uses Groundbreaker with at least one deal in their portfolio can build the cost of the software into their deals. They can spread it across their operating budget to cover it in their acquisition fee and returns. Jake shares that it’s only $4000 a year to be able to have Groundbreaker for your entire real estate portfolio. For people who are starting out and don’t have a deal that they have done, they are offering promotional pricing of $50 per month, and once they graduate to having a deal closed and a portfolio, they increase the price from there.

Next, we discuss what you should know and expect from Groundbreaker's services and offers as an investor. Jake shares that the software and the automation behind the workflow are just the beginning. They are in a continuous process of developing the capability of the software and service to be able to meet the needs of the market. A lot of people are looking for solutions for deal flow, underwriting, data, capital, property management, leads, accounting, and legal service. Their goal is to continue to analyze the needs of their customers and add the next component that is going to save people time. Groundbreaker is dedicated to continuous improvement and evolution.

Lastly, we talk about the real estate market we’re in and what it means to investors over the next 12 to 24 months. Jake shares that there are a lot of opportunities in the multifamily space. Most of his clients concentrate there, and there is so much demand for multifamily housing. According to him, deals will continue to happen, and the right operators that have good relationships with their Investors will be able to raise capital in this environment because they have the trust and the deal flow. However, operators relying on one or two large investors might have problems because that capital source might be waiting to see what happens in the market.

Make sure you don’t miss another amazing episode of the Just Start Real Estate Podcast with Jake Marmulstein and get valuable information on how to automate raising money and management!

Notable Quotes:

“If you build a large investor base, you will be able to control your outcome in downcycles because you can raise capital from different sources.”

Jake Marmulstein

“Listen to your customers' needs and figure out what people want. Don’t just create a product that you think they want and push it to them.”

Mie Simmons

“As an investor, your best use of time is raising capital and going out to find deals. Using a software solution will help manage data and tasks that aren’t the best use of your time.”