Description

Ethan Gao has owned several rental properties, made over 300 private loans secured by real estate (both single family and commercial real estate), invested in over 100 single family fix and flip projects and is a general partner on multiple commercial and multifamily projects totaling over 900 units. His primary role on deals is loan guarantor/key principal or gap funder (i.e. where the sponsorship team has raised around 80% of the limited partnership equity but does not have enough time to raise the remainder - Ethan will come in and lend that remainder to the team so that the deal can get done on time).  

Ethan personally and through his private equity fund, Good Bull Investments LP and Good Bull Lending, LLC has also invested in commercial properties totaling over $25 million (including hotels, self-storage, office building, medical office and retail). Ethan graduated from Cornell University with a BA in Economics in 2003 at the age of 19 and from Columbia Law School in 2006 at the age of 22. He worked on billion dollar mergers and acquisitions for several years on Wall Street in financial institutions before transitioning to being a professional investor and entrepreneur in 2016. He lives in Houston, TX with his wife (who he met the first day of class at Cornell in 2000) and their five children.

In this episode, Ethan talks about the art of networking, due diligence, and how to protect yourself from shady characters. He also discusses a particular strategy for raising capital that involves leveraging special services and “deep pockets” to bridge the gap between selling a deal and receiving funds. Hear how he raised $1.4 million in six days to close a deal before Christmas and learn the psychology of commission breadth, KP sponsorships, and net worth proofing on multi-million dollar deals. Plus, get advice on networking in the age of Covid and why money isn’t always the only factor when deciding on key partners or sponsors. 

[00:01 - 05:52] How It All Started

• Three years ago, he started offering his services as a key principal loan guarantor and backed into a side business of being a gap funder
• He has done more than a dozen deals as a loan guarantor and gap funder
• He co-manages Goodwill Investments, a private equity firm

[05:53 - 11:36] Deep Pockets and Desperation: How We Raised $1.4 Million in 6 Days

• Provides a level of security for closing deals
• Removes fear and makes interactions more comfortable when talking to investors
• Psychological boost of knowing worst case scenario you will still close the deal
• Raised $1.4 million in 6 days over the holiday
• KP sponsors deals a dozen times and is in process to do it more

[11:37 - 17:04] Navigating the Commercial Real Estate Space with Angel and Ethan: A Decade of Experience

• Bank may accept stocks, bonds, cash, IRAs, 401ks (with discount) and life insurance 
• Ethan has done industrial deals, multi-family, hospitality office industrial, storage 
• To get an agency card from Fannie Freddie one needs one commercial multi-family property or one commercial property with five years of ownership
• Virtual events allow people to network

[17:05 - 22:37] Closing Segment

• Ethan Goa shares why we don't just look at someone's net worth when looking for a key partner or sponsor - you need to know where the money came from
• To learn more about Ethan and his work, listeners can visit Good Bull Investments!

Tweetable Quotes:

“Networking is more important versus if they just stay in their whole market and that's all they do.” –