How to Start and Grow a Successful Real Estate Investment Association (REIA)

Whether you are new to investing in real estate or a seasoned pro, you can benefit from a real estate investment association. An association, or club, will expand your network. You can use your newly formed network to learn more about real estate investing and find amazing opportunities. You can get information on new trends, find out what works and doesn't work, and even find investing partners if you're so inclined. With so many opportunities, it is easy to understand why these clubs are growing in popularity.

Whether you are new to investing in real estate or a seasoned pro, you can benefit from a real estate investment association. An association, or club, will expand your network. You can use your newly formed network to learn more about real estate investing and find amazing opportunities. You can get information on new trends, find out what works and doesn't work, and even find investing partners if you're so inclined. With so many opportunities, it is easy to understand why these clubs are growing in popularity.

Many people simply join an existing real estate investment association, but that is not always an option. If your region does not have a real estate investing club or if the club it has doesn't represent your goals as an investor, you need to look for another option. That's when starting a real estate investing club is a good choice (Abulatif, 2018).

First, learn how these clubs operate and then discover how to start your association. It won't be long before you're in the position to expand your real estate investment business due to the people you've met and the information you've learned with your club. At the same time, you will help countless others who want to grow their real estate investment businesses.

How Do Real Estate Investment Clubs Work?

Real estate investment associations work in one of two ways. These clubs can be used for investors who want to make group or individual investments.

Traditional investment clubs are perfect for those who want to invest as a group. Once the group has its members, it usually forms a partnership, limited liability company, or corporation. Each member of the group must contribute a specific amount of money. Typically, members contribute a set fee upon entering the group, and then must also contribute a monthly amount. The monthly amount is usually less than the initial membership fee.

The group uses everyone's money to create an investment portfolio. The investments are based on rules set forth by the group.

Groups for people who want to make individual investments are called self-directed investment clubs (Steinisch, n.d.). Self-directed investment clubs allow members to invest independently. Even though the money is not pooled together and investments are not made as a team, these groups are still very valuable.

People use these groups for networking and education. When the group gathers, it might go over investment opportunities and discuss some roadblocks people have faced while explaining the solutions. These groups also bring in qualified speakers and other professionals to teach people about real estate investing. Self-directed groups are excellent for those who want to learn more about real estate investing and can benefit beginners and advanced investors.

While the clubs are different, successful ones have something in common. They offer benefits to the members they serve. For instance, some investment groups offer a discount for white label rental property and tenant screening software . Such software allows investors to create their branded websites, attract customers, and screen tenants. This value add-on positions investors for success. This is just one example of the various add-ons you can offer to make your group stand out from the crowd.

Now that you know how these clubs work and why they are so important, let's look at how you can start one. You will also learn how to grow your club, so it will be a success for the long-term.

Starting a Real Estate Investment Association

You might think that it is impossible to form a real estate investing club, but that's not actually the case. If you are interested in real estate and have some connections, you can begin the process.

Decide Why You Are Forming the Club

Your club needs a direction for it to be successful. You can't simply say, “I want to meet with other real estate investors.” That isn't reason enough to form a club. You could just hang out at the Chamber of Commerce or attend other meetings in your area. You need to have a clear direction for the club.

If you are unsure of what your direction should be, visit other real estate investment clubs or events in your area. Take notes and then reflect on the experience. What did you like? What didn't you like? This can help you decide how to move forward.

Gather the Founding Members

The best real estate investment clubs don't operate on a single person's vision. Instead, successful clubs are built on a combination of ideas. Instead of trying to build the club on your own, reach out to others in your network who might be interested. These people will make up your founding members, and some can serve on the board of directors.

Choose founding members who can bring something to the table. It's always smart to select people who come from different backgrounds and have diverse experiences. This will allow you to see the bigger picture and serve more people with your investment club.

If you don't know of anyone who would be interested, expand your network first. Mingle with other real estate professionals, and you will discover that many of them would be interested in forming a club.

Create a Mission Statement

Create a Mission Statement

Before you can start a real estate investment club, you need to create a mission statement. Your mission statement should provide a brief explanation of the club's purpose. Ask yourself the question, “Why does this club exist?” and then use your answer to create the statement (Ward, 2018).

The mission statement should describe what the club does and how it does it. Your investment group might provide resources for members, or it could actually make the investments. Think about the purpose of the group and write it down.

Next, think of how your group accomplishes this. Write down a sentence or two that explains this and combine both parts to create your mission statement.

To get a better idea of how this works, look at the National Real Estate Investors Association's mission statement. It reads:

“To develop, support and promote local real estate investor organizations while serving the interests of the real estate investment industry through networking, education, support, leadership on legislative issues, and promoting professionalism and standards of excellence in our industry (National Real Estate Investors Association , n.d.).”

This mission statement is short and to the point, and clearly explains the organization's mission. The first part of the statement explains what the group does. It develops, supports, and promotes real estate investors while also serving the interests of the entire investment industry. The second half of the statement explains how it accomplishes this. It does so through networking, education, leadership, and more. One simply has to glance at this mission statement to get a clear idea of what to expect from this organization.

With a statement so short and concise, you might think you can whip it up in a matter of minutes. However, your mission statement will be the foundation of your investment club, so you need to take your time when creating it. Gather your founding members together and set aside several hours to brainstorm ideas. One of the founding members should act as the moderator during the brainstorming process, ensuring that everyone sets aside their personal agendas and listens to all the ideas.

After the brainstorming session, the founding members need to critique the various ideas. Each idea should be discussed, and the group should set aside those ideas that do not match up with the club's vision. This will weed out some of the ideas and leave you with a better idea of what you hope to accomplish as a club.

Then it is time to gather the ideas that fit into the mission and summarize them. Finally, compose the mission statement.

Create Your Business Plan

Create Your Business Plan

Your mission statement will give you an idea of what you expect from your real estate investment club. Next, you need to write a business plan (Nicastro, 2019). Your business plan should include:

  • Executive summary - The summary includes your mission statement, a description of your offerings, an overview of your goals and plans, and a statement describing how the club is structured.
  • Company description - Include the club's name, registered address, history, and the founding members
  • Club goals - Explain each goal the club has, along with the plan to reach it
  • Business structure - Describe how the business is structured (partnership, LLC, or corporation)
  • Club offerings - Explain each offering in detail and pricing for services, if applicable. Also include membership fees, if applicable. Keep in mind that many clubs offer different pricing tiers, and each tier provides access to different services, tools, and resources.
  • Marketing plan - Include detailed information that explains how you will market your club to reach new members
  • Financial plan - Both for-profits and nonprofits should include a financial plan that provides an analysis of the current financial situation, as well as projections for the future.

Just like the mission statement, it will take some time to complete your business plan. Do not rush the process. Your business plan will guide you along the way, so you want to make sure it contains the proper information.

Determine Your Board of Directors

Determine Your Board of Directors

If your club is a nonprofit, you must have a board of directors. Even if you don't have a nonprofit, a board of directors will help you reach your club's goals while ensuring it aligns with the overall mission each step of the way. You can pick your board of directors from your founding members. These are the people who are most invested in the success of the organization, so choosing from that pool will allow you to hit the ground running.

Your initial board will be appointed. After that, your members will elect board members. If your club is a nonprofit, your state will have rules regarding the number of people you need to have on the board. Many states require a minimum of three board members, but you can have more if you wish (Pakroo, n.d.).

You can choose the positions you want to fill for your board of directors. Many investment groups have a:

  • President - Oversees the group and is responsible for ensuring that each venture aligns with the mission statement
  • Vice president - Works closely with the president and fills in when he or she is not available
  • Treasurer - Responsible for the group's financials
  • Communications officer - Handles the marketing and communications, including the newsletter
  • Secretary - Takes meeting minutes and creates the agenda

You can add additional positions as well. Consider what responsibilities you need to fill and then create your board of director positions.

Vetting the Board of Directors

When you are setting up your club, you might want to hand out positions on the board without giving it much thought. However, your initial board of directors will set the tone for your club. If your board isn't invested in the success of the group, you will have a difficult time staying afloat. With that in mind, you need to vet people before appointment them to the board.

First, consider the person's expertise. If you are trying to fill the treasurer's position, you need to choose someone who has a background in accounting. Otherwise, you could end up with a financial problem on your hands.

On the other hand, if you are filling the role of president, it's key to choose someone who has demonstrated leadership skills. The president has to ensure that the board's actions align with the group's mission. If the person is not a good leader, he or she might have trouble saying no or guiding the board properly.

Consider the skill set needed for each board position. Then seek out people who meet at least the minimum requirements.

A commitment to the success of the club is also important. Some people look at a position on the board as a nice addition to a resume. You need to find people who are excited about the club and want it to thrive. They aren't just excited, but they are willing to put in the work necessary to make it happen.

With that in mind, you also need to choose people who have the time necessary to devote to the tasks at hand. If someone is too busy to devote enough time to the board, it's a good idea to find someone else. Serving on a board can be time-consuming, especially when the group is new. At first, people can expect to spend some time each day to do board duties. Those who are already juggling busy schedules likely won't be a good fit.

It is also smart to run a background check on board members before hiring them. You don't want to take on a treasurer who has been convicted of financial fraud, just as you don't want your communications officer to have a history of identity theft. After running background checks, you will know if you should proceed with that person or find someone else.

Structure the Group

If you decide to create an informal real estate investment club, you do not need to register it with the Secretary of State. An informal club is just as it sounds. A few friends will get together at a set time to discuss real estate. There aren't any dues to pay with this type of club. People simply network, share tips, and then get on with their day. Informal clubs usually meet at local coffee shops, restaurants, or homes. These groups look and operate more like social gatherings than like true real estate investment clubs.

You are likely interested in creating a formal club. Formal clubs can operate as for-profit or nonprofit entities. For-profit groups often host real estate gurus that sell products, bootcamps, or training. The investment club might make 50 percent off each sale. Nonprofit groups do make money, but that money goes back into the organization. For instance, a nonprofit collects dues and uses the money to host speakers and other events. It also might use some of the profits to provide members with important marketing materials. However, the profits do not pass through to the people. The profits are used to make the club bigger and better.

Regardless if you are a for-profit or nonprofit organization, you must choose a structure for your club. Most clubs are structured as partnerships, limited liability corporations, or corporations. Let's take a closer look at each option.

Partnerships are the easiest entity to form. You simply need to fill out a partnership agreement and register with your local county. Your county will give you a “Doing Business As” certificate. This certificate will list the name of your club. You will use that certificate to get a Federal Employment Identification Number, so you can open a checking account in the club's name.

Many people choose to open an LLC or a corporation instead of a partnership (Wong, n.d.). Like partnerships, both LLCs and corporations can be formed as for-profit or nonprofit clubs. Corporations have the most rules out of all the options. You will have to follow the state laws for corporations, such as having a board of directors and taking meeting minutes. LLCs are much more flexible.

Begin by visiting your Secretary of State's website. Search for your business name to make sure it hasn't already been taken. If your name is free and clear, register it with the Secretary of State to claim it. Your state has specific requirements for registering partnerships and LLCs. Follow the steps to register your business. If you are forming a corporation, you will also need to file Articles of Incorporation.

Then you will likely need to register with your state's department of revenue and the IRS. You will receive your EIN from the IRS. Once you get it, you can go to the bank and open an account in your club's name. Do this immediately, so you will be ready to process payments as soon as your first member signs up. Keep in mind that you might need to bring your club's paperwork with you when opening the account. You will need to prove that you are authorized to open an account on behalf of the club.

Create Your Bylaws

Create Your Bylaws

Organizational bylaws make it easier to address situations that come up when running an investment club (Community Tool Box, University of Kansas, n.d.). Bylaws are essentially the rules that govern an organization. Board members and club members can turn to the bylaws to determine what is expected of them. If a problem occurs, the board and membership can read through the bylaws to find out how to address it.

For instance, imagine starting a real estate investment club, only to realize that your secretary isn't interested in actually participating. He or she never comes to meetings, and you constantly have to find a way to fill that person's shoes. You find yourself taking minutes, printing agendas, and doing other activities that are the secretary's responsibilities, and you are burned out.

If you don't have bylaws, you won't be sure how to address this situation. Can you remove the secretary? Do you have to keep hobbling along, filling his or her shoes? You won't know how to move forward.

However, if you have well-written bylaws, you will know exactly how to proceed. Your bylaws should address what to do when a board member doesn't fulfill his or her responsibilities. For instance, the bylaws might state that missing three meetings in a row is essentially quitting, and the member is dismissed. This can help you avoid messy situations when running your club. It will also help you fill spots on the board that have been vacated, so you can run on all cylinders from one month to the next.

Bylaws include articles. Each article addresses an aspect of your business. Begin by creating Article 1 of your bylaws. This article covers the name and purpose of the club. You can add your mission statement to this article as well. Article I is typically the shortest part of a club's bylaws.

Article II covers membership. You need to include the rights of the members, as well as the requirements for membership. Many clubs have an open-door policy for all interested members because screening members is too time-consuming. However, it is critical to understand that some members might act in a way that is detrimental to the organization. Explain the rules and go over the reasons why you can suspend or revoke membership. Also, make it clear that membership can be revoked for any reason. This will cover you in case someone does something that hurts the organi8zaton but is not explicitly listed in the bylaws.

It's also important to understand that some groups have honorary members. You might choose to make the founding members honorary members or bestow the honor on those who provide certain skillsets. Outline the terms for honorary membership in this section.

Article III covers the officers and the decision-making process. Begin by explaining the governing structure of the club. For example, how do checks and balances work within your club? What prevents the president from making unilateral decisions? How are tasks delegated? What are the duties required of each board member?

Include information about committees in this section as well. As your club grows, you will begin to rely on committees to handle some of the work. You need to explain how your club will form committees, how many members each committee can have, and the time limit that committees are active.

The decision-making process must also be included. How do board members make decisions? What happens if the board members tie when voting? How many board members need to be present to establish quorum? This refers to the minimum number of board members needed to conduct official business. If you have a board of five, a quorum will likely be three. Explain that clearly in the bylaws.

Finally, finish this section by explaining how to amend the bylaws. As your club grows, you might realize that your bylaws are lacking in certain areas. Amending bylaws is similar to amending the constitution. It is wise to give members notice and then schedule a vote. Typically, two-thirds of the membership must vote on the change to add the amendment. If you don't get two-thirds of the vote, it is clear that the members do not want to amend the bylaws.

Article IV covers meetings. You will likely have general, special, and annual meetings for your club. Explain how often meetings will occur. If you are not sure how often you will have meetings, you can set a minimum. For instance, your bylaws can state that general meetings must occur at least once every 90 days. You can meet more, but you must at least meet the minimum requirement to satisfy the bylaws.

You also need to cover special meetings. Determine who will call the special meetings and who will be involved. Will special meetings be reserved to board members or open to the public? How much notice is needed to call one of these meetings? Can votes take place at special meetings?

You also might want to hold an annual meeting for your members. Explain what annual meetings will entail and when they will be held. You might want to hold elections at your annual meetings. Make that clear in the bylaws.

Finally, you will need to cover the Board of Directors in Article V of the bylaws. Outline each board member's role. You should also explain the process for removing board members and explain how members are elected. That includes the length of the terms. It is critical to stagger the terms of the board members, so all the terms do not expire at once. You can stagger the terms how you wish. However, many boards assign a one-year term to some board members and a two-year term to others when the members are first appointed. Then, during elections, everyone is up for a two-year term.

You should also include information about the frequency of board meetings. Again, you can state the minimum number of meetings required, but the board can meet more often if needed or desired. Many clubs state that board meetings must take place at least three times a year, but actually meet once a month. This gives them some leeway in case they need to cancel some meetings throughout the year.

Create a Disclaimer

Create a Disclaimer

Before you begin inviting members into your club, you need to create a disclaimer. You will hopefully attract lots of members, and as the meetings get bigger and bigger, it will become impossible for you to manage all the interactions. People will network at your meetings and connect with other members at other times. If you fail to create a disclaimer, your organization could be held liable for bad advice or poor decisions made by members.

The disclaimer needs to state that the organization is not responsible for other members, guests, speakers, vendors, or agents. Explain that each member must do his or her due diligence when getting advice from others. Also, explain that if a board member endorses a product or idea, that endorsement is not from the club.

The disclaimer also needs to explain that the board can suspend or revoke membership at any time. People need to understand this when they sign up for membership.

Value Add-ons – The Key to Maintaining Your Club

Your paperwork is in order, and you are ready to start your club. Actually, that's not quite true. You need some value add-ons to attract new members. These value add-ons will go along with your core mission and make your club more attractive to potential members.

Value add-ons are essentially benefits. They make the price of membership seem like a steal and position people to be successful real estate investors.

What kind of benefits should you include? Let's look at some of the most popular.

Savings to Members

Membership should have its privileges, and the best real estate investment groups offer privileges in the form of savings. For instance, providing a discount on tenant screening and rental property software is an excellent way to attract new members while keeping existing members happy. Such software allows investors to market their brands while helping other investors establish themselves. Look for white label software that allows investors to attract realtors, property managers, and landlords. The software should be easy to set up, professional-looking, and optimized for SEO, so members of your investment group can hit the ground running. Such a tool will help them grow their business, and it will also help you attract more members to your group.

You can also partner with local businesses to offer savings. Do you have a home improvement store in your local area? Reach out and see if your members can get a discount. In exchange, you will advertise to your membership. Local businesses will see the value in this. Real estate professionals shop at home improvement stores often, so the local company can make more money while offering a discount.

Find as many discount opportunities as you can and include the information on your website and in your marketing materials. This will help you reach more people.

Provide a List of Subcontractors

Real estate investors often utilize subcontractors. For instance, they might purchase a property and need to make some improvements before selling it. They also might rent out the property, meaning they will need ongoing maintenance. Finding subcontractors is difficult for new real estate investors. In fact, many investors have horror stories related to contractors.

Take the story of “The Fraud and the Injured Man,” for example (Snodgrass, n.d.). A real estate agent represented an investor from another state. The agent was supposed to hire a contractor to rehab a property. The first contractor was nothing short of a fraud. He grabbed the money, and the agent never heard from him again. The agent then hired a general handyman who did not have insurance. The handyman brought his buddy with him to rehab a house, and the garage door allegedly fell on the friend's leg. The agent's insurance company ended up paying the bills, but it could have been much worse.

This is just one of many horror stories investors have experienced. That is why real estate investors are so hungry for lists of vetted subcontractors. You can compile such a list with the help of your network, and then offer it as part of membership benefits. Your new members will be pleased to get a list of subtractors they know they can trust. Just include a disclaimer that you are not responsible or any of the work provided by these subcontractors. The list is a courtesy and not an endorsement. Also, don't forget to amend the list if necessary. If someone has a bad experience with one of the contractors, remove that contractor from the list.

Host Speakers

Host Speakers

Your real estate investment group should provide educational opportunities for members. That includes speakers. If you offer an assortment of speakers throughout the year, you will give people a reason to join your group.

There are two types of speakers to consider. First, you have local speakers. As you can imagine, local speakers are the easier of the two to get. Begin by choosing a topic. What does your investment group want to learn about? What are your members most interested in? Once you have a topic, you can begin your search for local speakers.

You can approach professionals in your local area to speak. Many will do so for free as a way to build their networks. For instance, if you want to talk about lending in real estate, you can approach a lending professional in your network. That person will likely be pleased to speak because he or she might get some new customers out of it. If you want to talk about choosing the right property, a realtor might be able to help. A tax professional can help your members during tax season, and a general contractor can provide tips for taking care of properties.

National speakers are a little trickier, but they also offer more value. You can actually boost your membership quite a bit by hosting a nationally known speaker. You can contact the speaker or his/her representative directly or go through a speakers' bureau. Using a speakers' bureau has lots of benefits (Hall, 2018).

First, speakers' bureaus provide easy access to experts. The speakers aren't just experts in their fields, either. They are experts at providing keynote speeches. They understand how to keep the audience engaged while providing important information. You won't have to worry about hiring someone who can't hold the audience's attention or jumbles through the words when you go through a bureau.

It's also worth noting that speakers' bureaus mitigate the risk of hiring a speaker. Speakers are human beings, and sometimes, things happen. You might hire a speaker who gets sick and has to cancel. If you have to cancel the event, your members will be upset. However, if you use a speakers' bureau, the organization will provide you with another speaker. The speaker will have the same qualifications, so while you will have to let your members know about the switch, you won't have to cancel the event.

Also, a speakers' bureau will handle the logistics for you. If your club is relatively new, the idea of arranging a keynote address can be overwhelming. How will you negotiate the contract? What about setting up the audio-visual equipment? Where will the speaker stay? If you try to handle all this on your own, you can expect to hit some road bumps that could make your event less than a success. When the bureau handling everything, you can sit back and prepare for an amazing keynote address.

The speakers' bureau will also schedule a phone call between you and the speaker before the event. This call will normally take place three weeks to a month prior to the speaking engagement. This will give you the chance to let the speaker know more about your organization and the theme of the event. You can explain your main objective for the event, along with the message you hope the speaker will convey. This allows the speaker to personalize the keynote address to your organization.

While hiring a speaker from a speakers' bureau provides lots of benefits, it is more expensive than hiring a speaker directly. You can expect to spend 20 to 30 percent more per speaker when you hire through a bureau. This sounds like a lot of money, but you have to consider the value you get from the bureau. The bureau will help ensure your event goes smoothly, so the extra money might be money well spent.

However, if money is a serious concern, contact the speaker directly. Keep in mind that you might have to pay for travel expenses, meals, and lodging, though. That can add up, especially if the speaker is located on the other side of the country. Compare the costs of the two to see which makes more sense for your organization.

Hold Social/Networking Events

Hold Social/Networking Events

If you spend much time researching real estate investment groups, you'll realize that the successful ones hold social /networking events on a regular basis. Some host lunches that include time for socialization and feature a speaker, while others have cocktail hours. Members are invited to mingle with other members during the cocktail hour, building their networks. Some even have annual parties for members to come out and celebrate. Offer an assortment of social and networking events for members to enjoy. As your club grows, consider expanding your offering as well.

Create Workshops for Specific Groups

When you have a real estate investment group, you will realize that members have very specific needs. Some of your members will want to learn about investing in multi-family properties, while others will want to cover long-term rentals. Others might be interested in tax liens. Consider the different niches that are of interest to your members. You can survey them or ask them for input. Build your list and then create workshops for the different niches. Take attendance at these workshops to determine what is successful and what isn't. If a workshop is extremely successful, consider other topics that are closely related to it. This is an excellent benefit to provide to your members.

Members' Area on the Website

You can also create a member's only area on your website as a way to attract more members. Fill this area with important information related to your group. You can also upload videos of speakers who you've hosted and question and answer sessions that provided lots of information. Also, don't be afraid to create new videos on a weekly basis. You can discuss different real estate topics during these videos. You can even make it fun by having members submit questions. You can pick one question each week to answer in the video. This extra value will help you differentiate your group from others.

Promoting Your Real Estate Investment Club

The paperwork is done, and you know what you're going to offer your members. You also have a solid board of directors in place.

You're just missing one thing.

Members.

You can build a solid membership by promoting your club. Learn some tips to help you gather members quickly.

Create Your Website

You need a professional online presence if you're going to attract members. People conduct online research before committing to something. Create a professional website with information related to your investment club. Include your mission statement and bylaws on your website so people can research your club.

Turn to Your Real Estate Network

Next, access people in your network. If you have yet to create a vast real estate network, it is easier than you might think. You are surrounded by opportunities to build your real estate network (Shalhout, 2017).

Begin by attending real estate auctions. Real estate investors frequent auctions so they can buy properties quickly. You will find people who are interested in building real estate investment portfolios. Make connections and give details about your investment club. Be sure to include the value add-ons that make your club special.

Next, join your local Chamber of Commerce. The Chamber of Commerce hosts networking events throughout the year, and you are certain to meet interested investors. You will likely find a mixture of new and seasoned investors. Build relationships with these investors and then invite them to join your club.

Also, look for real estate investors online. You might find informal investor groups on Meetup or Facebook. Join the groups and make connections. After you have made strong personal and professional relationships, talk about your group.

Expand Your Network Online

The internet is another great way to expand your network. Create a LinkedIn profile and connect with other investment professionals. Then create a Facebook page and group for your real estate investment club. You can run Facebook ads to send more people to your page.

In addition, create Instagram and Twitter profiles. The stronger your social media presence, the easier it will be for you to get noticed.

Give Members an Incentive to Recruit

Word-of-mouth advertising is the most powerful tool you have at your disposal. Eighty-three percent of people trust recommendations from friends and family members, according to Nielsen (Nielsen, 2015). Providing a great service to the people in your club will help you get word-of-mouth advertising, but that isn't enough. Consider offering members an incentive for every new member they refer. A month of free membership and a discount are two options. You can also offer free gifts, additional training, and resources, or something else. The key is to make it valuable enough to make people want to recruit members for you.

Committees – The Key to Staying Sane While Growing Your Club

As your membership grows, your board will begin to feel overwhelmed. Your members will likely be volunteers, and if they do make a salary, it won't be enough to compensate them for all the tasks required. You can avoid board burnout and keep your club running smoothly by utilizing committees.

You should have outlined the rules governing committees in your bylaws. This should have included how committees are selected, the maximum number of people on the committees, and how long each committee lasts. You might wonder why you need to put a time limit on the terms. This is for two reasons. First, committee members can get burned out just like board members do. If committee members are expected to serve for the duration of the club's existence, they might end up dropping out.

Second, rotating committees is important to the growth of the organization. This gives more people a chance to get involved in the process. Your members will begin to take ownership of the club and become personally invested in it. Invested members can help you grow your club.

The committees you choose depends on your organization's needs. However, there are some committees that all clubs can benefit from. Let's take a closer look at these committees. As you do, think about additional committees you would like for your group.

Recruiting Committee

Recruiting Committee

You want to grow your organization, and that means that you need recruiters who find new members for you. Your recruitment committee will constantly look for new members to join. Give the committee resources to help them attract new members.

New Members' Committee

Your new members' committee will work with new members. The committee will introduce new members to existing members and explain what the organization does. The committee should provide new members with a schedule of events and be available to answer any questions.

Programming Committee

You need to provide fresh material at each meeting and networking event. You will likely have at least one event or meeting per month, and it can be difficult for the board to stay on top of this. Create a committee with the sole task of identifying trends and topics to discuss at meetings and events. Provide the committee with tools to use to make their job easier. For instance, give them access to survey tools they can use to survey the members. You can also provide them to subscriptions to real estate investment websites and magazines, so they can stay on top of trends.

Emerging Leaders Committee

You want to recruit people of all ages to your club. However, some clubs have difficulty recruiting and retaining young members. Young members are needed to keep the club going for years and years. You can keep these members engaged by forming an emerging leaders committee. The committee should work directly with members who are 35 and under. The committee can find out what these emerging leaders need from the club and then take the information back to the board.

Special Events Committee

You will likely host various special events throughout the year. There will be speakers, social events, and more, and you need a committee to manage these important activities. This committee should work with the programming committee to create special events that your members will love. These events should be planned and announced at least six months in advance.

Renewals Committee

Getting members to renew is one of the biggest challenges that organizations and clubs face (Ebner, 2017). Organizations need to put a lot of effort into getting members to renew. Phone calls, emails, digital tools, and one-on-one conversations are necessary to boost renewals. This can be a cumbersome task for the board to take on, so it's wise to use a committee. Form a five-person committee and give each committee member a task. This will help you boost your renewals.

Just remember that you will need to provide the committee with information regarding renewals. Use software to track memberships, so you can provide the committee members with an updated list of who is due to renew.

A/V Committee

Do you intend to host lots of local speakers and question and answer events? Your members need to hear what the experts say during your meetings and special events, so consider adding an audio-visual committee to your club. This committee should understand how to set up an event to ensure everyone can hear, even if they are seated in the back. The committee members should also be on hand to fix any issues that might arise during the event.

Product Demo Committee

Do you intend to offer products at discounts to your members? It is important that people know how to use the products and what benefits they will provide, so consider adding a product demo committee to your club.

For example, assume you are going to offer a discount on sales and marketing websites for real estate professionals. You need to show members how this product can help them. Your demo committee can set up a website using the software and demonstrate how it works. Once people see how the site can be customized and configured, they are more likely to purchase it. They will understand the value of the product, and thus, the value of your club.

Political Action Committee

As real estate investors become more experienced, they also become more interested in what is going on politically. They understand that new legislation can impact their business.

Take the rent regulations that went into effect in New York in June 2019, for instance (Rozner, 2019). Landlords state that this legislation is bad for business, and will also harm tenants. The legislation preserves the current rental rates on one-third of the state's units. Landlords have to rent units at the same price when tenants leave. That cuts into their profits, while also hurting tenants. Because landlords can't raise the rent, they are less likely to improve units.

You can form a political action committee to address the concerns the investors in your group face. Seasoned investors will appreciate your club going to bat for them. You can discuss legislation that concerns them, and also determine what type of legislation they want to see on the books. Then your committee can lobby local and state officials.

If you are a nonprofit, you might think you can't do this. After all, isn't lobbying the fastest way to lose your nonprofit status?

Actually, nonprofits can engage in some lobbying and maintain their tax-exempt status (Fishman, n.d.). To maintain your nonprofit status, you will have to pass the IRS's “substantial part” test. You will pass the test as long as a substantial part of your organization's activities are not related to lobbying. This includes the amount of time your organization spends lobbying, as well as the amount of money that goes into the cause.

The IRS has not indicated what it considers to be a “substantial amount,” so nonprofits typically look at the outcomes of court cases to make a determination. Most try to keep lobbying down to less than 5 percent of the budget to avoid experiencing problems with the IRS. The courts typically view this as minimal lobbying.

Keeping Existing Members Engaged

Many of your members will be newbies to real estate investing when they first join. They will soak up everything that you have to offer in the beginning, and over time, they will become seasoned real estate investors. As that happens, you run the risk of them becoming less engaged. They won't want to attend beginners' workshop or go to meetings that are geared to new investors. That doesn't mean you have to lose them, though. Instead, you need to provide them with tools that will keep them engaged.

Educational Workshops That Cover Advanced Topics

When you first start out, you might not need to have workshops with advanced topics. However, as your members learn more about investing in real estate, they will start looking for advanced topics. If you continue to only offer the basics, they will get their information elsewhere.

Along with beginner workshops, you need to provide workshops that educate advanced real estate investors. You can talk about adding employees to a real estate investment business, provide estate planning information, and have workshops about tax loopholes for real estate investors. Survey your experienced members to discover their knowledge gaps. Then fill in those gaps with high-quality workshops.

Record-keeping – Stay on Top of Your Books

It doesn't' matter if you run a for-profit or nonprofit investment club. In both cases, you need to keep detailed financial records. Your members need to have access to these records, and you will also need them for tax purposes.

Your club's treasurer will be in charge of the record-keeping tasks, but you should audit the records on a regular basis. Get tax software for your treasurer to use and analyze the financial reports on a monthly basis.

Setting up a Meeting

Now you know how to run your organization, but what about the meetings? This is where you will connect with your members and form relationships. It is also where you will demonstrate value to your members.

There are three steps to setting a meeting. You need:

  • Event space
  • To promote the meeting
  • To set an agenda

Choosing Event Space

You need to find a space to hold your meetings. If possible, choose the same space for each regular meeting. If you have a speaker who will attract a larger number of people, you can choose a different space. You can also choose different spaces for cocktails and other social events.

Reach out to your network of contacts when looking for a meeting space. For instance, a real estate company or title company might give you access to its conference room as long as you promote the business. That is an excellent trade-off. You can also look at hotels, community rooms, colleges, and restaurants.

If you still have trouble finding a meeting space, use an online meeting finder. You can simply input your location, the desired setup, number of attendees, and timeframe to look at different options.

Promoting Your Meeting

After the meeting's time and space are set, you need to promote it. Send an email and update your social media channels, so your members know about the meeting. Also, remember this is a way to recruit new members. Advertise the meeting to new members using social media, online ads with your local newspaper, and radio ads, if you have the budget. You can also create flyers to put up in local businesses and coffee shops, and don't be afraid to ask your network to promote the meeting to their business associates.

Many investment clubs let nonmembers attend one meeting for free as a way to decide if they want to join. Let people know if they plan to do this. It will help you reach more people.

Setting the Agenda

You need to create an agenda for your meeting. The agenda should be printed and handed out to members when they arrive.

The agenda should outline everything that will be covered during the meeting. Your agenda should include:

  • Call to order
  • Acceptance of the last meeting's minutes
  • Treasurer's report
  • Old business
  • New business the group wants to discuss
  • Educational program or topic
  • Assignments or homework
  • Adjournment

You also need to print the minutes of the meeting. Every member should get a copy of the meeting minutes to go over.

Are You Ready to Create Your Real Estate Investment Club?

A real estate investment club is an excellent way to grow your investing business. Even if you have been a real estate investor for decades, you can still learn from other professionals. Plus, you will enjoy mentoring others in your field.

Use this information to build and grow your club. Remember to offer value add-ons to differentiate your club from others and provide seasoned investors with the tools and resources they need to stay invested.

If you follow these tips, you won't just create a real estate investment association. You will create one that thrives.



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