Why Raising Capital Too Early Forces Bad Deals featuring Colby Kirk

Colby Kirk has spent eight years building a Kansas City real estate business across three buckets: wholesaling, multifamily repositions, and private lending. Before real estate he was, in his words, a failed entrepreneur, running a custom suit company out of Georgetown with product made in Pakistan after a Peace Corps stint in Costa Rica. In this episode Colby walks through the 33 unit package he closed with 18% hard money after a year of follow up, the 32 unit deal that broke when interest rates doubled in 2022, and how he found a hard money lending opportunity in Wichita where borrowers were paying 24 to 36 percent annually. If you are an operator trying to figure out how to stack multifamily and private lending without letting one starve the other, this conversation is for you.   Timeline Summary [1:30] – Leon welcomes Colby Kirk to the show and heads back home to Kansas City for the conversation [3:01] – Colby breaks down his three buckets, the wholesale company he is winding down, multifamily repositions, and private lending [4:58] – Why he walked away from the retail agent path within months of getting his license in 2018 [5:58] – Finding an old vacant property rental registration list and cold calling his way into off market deals [7:14] – The businesses that failed before real estate, a men's suiting company, affiliate marketing, and lawn care [8:31] – Peace Corps in Costa Rica, grad school at Georgetown, and why bureaucracy pushed him back toward entrepreneurship [9:38] – Building a custom suit company with product made in Pakistan, priced at 500 dollars against 1200 dollar competitors [12:21] – Selling suits on the corner of Wisconsin and M Street in 85 degree heat and getting laughed at [17:32] – The 33 unit package from owners in their 80s, closed December 2019 with 18% hard money [21:17] – Growing up with a poverty mindset and still actively working to unlearn it [24:01] – The handwritten 30 page list that served as his CRM and a full year of monthly follow up [24:44] – Closing the deal over Denny's lunches and the elderly landlord avatar he still targets today [29:22] – The 32 unit fourplex play that broke when rates jumped from 3.5 to 7.5 percent [32:21] – How renovating one model unit set a new comp at 375 when the highest was 325 [35:25] – Why Wichita borrowers paying 24 to 36 percent annually signaled a lending opportunity [39:45] – The barbell strategy of pairing a debt fund with multifamily equity so capital never forces a bad deal   5 Key Takeaways Give the Business Five Years — Colby's earlier ventures died because he got bored and moved on inside two or three years. He committed to five years in real estate no matter how it looked early, and that commitment is what let the business compound. Follow Up Longer Than Feels Reasonable — He called the same elderly owners roughly once a month for twelve months before they came off their price. The 33 unit package closed because nobody else stayed in the conversation that long. Sell to the Avatar, Not the Address — Elderly landlords with no professional management and kids who want nothing to do with the properties became a repeatable buy box. He found it on one deal and has bought from that same profile many times since. Lender Relationships Are the Real Backstop — When rates doubled and the fourplex exit vanished, he went back to capital partners who owned half the deal and asked for more renovation money. That relationship turned a stuck project into a profitable one. Pair Debt With Equity So Capital Never Rushes You — A standalone multifamily fund pressures you to deploy, and pressure produces bad deals. Running a debt fund alongside it keeps capital working while you wait for the right asset.   Links & Resources Collective Genius — https://www.explorecg.com Vetus Capital, Colby's lending and multifamily company — https://www.vetuscapital.com Colby Lee Kirk on Facebook Rich Dad Poor Dad by Robert Kiyosaki Think and Grow Rich by Napoleon Hill   Enjoyed This Episode? If the story about setting a brand new comp at 375 in a market where nothing had sold above 325 got your attention, you probably know an operator who is sitting on a deal that stopped penciling. Send this one to them. Follow the show, leave a rating, and drop a review so more investors can find these conversations.