Tuesday, April 07, 2009

Real Entrepreneurial Real Estate--Be Prepared

We had another great visitor to our entrepreneurship class at Drake Univ. Shannon Morton, an associate at Ferguson Commercial Real Estate Services, stopped by to discuss how start-ups and other entrepreneurial businesses can work with real estate brokers. Shannon and I became acquainted shortly after he returned to Iowa; we hit it off immediately trading war stories about working in New York City. He's what I think of as a hybrid Midwesterner: deep roots, but a faster moving and more willing to try new things. Also polished and smooth, but very down-to-earth. (Like all real estate pros he also drives a cool car.)

Anyway, with no prompting from me, the first thing Shannon advised the students to do in preparing to work with a broker is to develop a solid business plan. As he explained, without a solid plan the entrepreneur appears not to understand his or her business, is unlikely to get any financing, and is more likely to waste the broker's time. And time is a real estate professional's most important asset.

The second important asset for most brokers, and the one that can be of the most help to an entrepreneur, is the broker's relationships. As with any business, an entrepreneur's success will be built on relationships. A real estate broker can offer terrific "relationship leverage" to an entrepreneur, particularly one new to a community or a neighborhood. Shannon walks the talk in this regard. He recently helped a local social venture get started; he not only found a great space at a good price, he also connected the entrepreneur with partners who financed parts of the new venture, and agreed to join the advisory board.

Frankly, I was a little skeptical about bringing a broker into the classroom. I've worked with stock brokers and real estate brokers all my professional life, and too many have only focused on the sale. Shannon emphasized working hard to develop a relationship, to support his clients, and to get a good deal done. And, of course, he urged the students to be prepared. That's good advice, not just for scouts and evil lions,

but for any entrepreneur.

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