- Pranay Parikh: From Doctor to Real Estate Investor Screw The Stock Market 43:22
Pranay Parikh From | Doctor to Real Estate Investor
Today on the show, we have a special guest, Pranay Parikh, an accomplished passive investor. Pranay has had a remarkable track record in acquiring a significant amount of assets quickly. We are eager to hear about his journey in the industry and learn more about his strategies. Join us as we dive into the world of passive investing with Pranay.
About the Guest
Pranay, born and raised in California as the child of immigrant parents, feels he won the lottery by being born where he was. His father, who he visited often, came from a small town in India with limited resources. But through education, he became an engineer and worked in Silicon Valley, which ultimately changed the trajectory of his life. After becoming a hospitalist and completing his residency, Pranay realized that traditional Retirement plans like a 401k would not allow him the freedom and flexibility to practice medicine the way he wanted. This led him to explore real estate and eventually passive real estate investing through syndications.
How He Got into Real Estate
Pranay had experience with active real estate, which involves buying properties and becoming a landlord. However, after having some success with his first property, a four-unit building a couple of blocks from the water, he found that finding and managing properties was taking up too much time and effort. This led him to discover passive real estate investing, where he could invest in properties managed by others, similar to a hedge fund. With this approach, he let others handle most of the work, including finding and renovating properties, while still earning a return. Additionally, he realized that these other professionals could run the business much more efficiently than he could as a full-time medical doctor.
Pranay believed he had reached the end of his journey in real estate investing. He had taught others how to find good deals, vet them, and negotiate the terms. However, he found that many of these individuals were not interested in doing the necessary work. This led him to consider a new approach – pooling his money with other investors to invest in deals as a group. This would allow him to access better deals with better terms. And thus, Ascent Equity Group was formed. Over time, Pranay recognized that not only was he able to invest in larger deals, but he also could buy the entire deal himself.
Pranay and his team created a course hosted on Kajabi, designed for individuals with little to no knowledge about real estate investing. The course aims to teach them how to find and invest in deals called Country Club Deals. These types of deals were previously only available to certain individuals before 2012, and even now, they can only be accessed by accredited investors – those who make over $200,000 per year for two years or $300,000 as a couple for two years or have a net worth over a million dollars. Additionally, there are certain tests like Series 65 and Series seven that individuals can take to become an accredited investor and understand alternative investments, not just limited to stocks.
The team’s goal was to educate people and prevent them from getting into bad deals without the proper knowledge. Many times, high-net-worth individuals and professionals, such as doctors, are targeted by people who want to sell high-fee investments like mutual funds or real estate. That’s the main reason for creating this course, to educate and empower people to make informed and smart investment decisions.
How Pranay and Operators’ Deals
Pranay states that his group is in a unique position where they don’t have to go out and find deals as they come to them. The reason is that they provide a lot of value to the operators, the individuals responsible for the day-to-day running of the properties. They handle all the investors and bring all the money to the table, but they also assist with operations. For example, he compares their role to that of a convenience store owner who is busy working 9-5 and doesn’t have time to bring in more customers or change prices. Because his group doesn’t handle the maintenance or leasing, they can think bigger and figure out how to maximize profit for all of their investors. This is a big win for the operators, and that’s why they bring them deals. And for the investors, bring the deal, negotiate, and have real control over what happens and what doesn’t happen because of their involvement in the operations.
How Operators Find Pranay
Pranay and his team are actively seeking out a specific caliber of operators in their real estate investments. They look for individuals with billions of dollars under management, a strong track record of buying and selling properties, and 20% per year or higher returns. They connect with these potential operators but also vet them at a much deeper level than Pranay could do individually. For example, when they present an opportunity to sponsor and write checks of 15 million dollars, the operators will provide all their financial records and showcase all their properties which enables Pranay and the team to have a much deeper understanding of their business, returns, and properties.
Scaling through the Operators
Pranay has achieved success by continually pushing himself to do more. One of the reasons for his success is that he built an audience before launching his business or product. He established a personal brand by writing a blog, speaking at conferences, and even hosting his own podcast. With this following already in place, Pranay could scale his business to new heights. He emphasizes that this achievement did not happen overnight; it took years of hard work and dedication to build the audience he has today.
Biggest Lessons in Passive Investing
The key takeaway when investing, whether in your own investments or buying stocks, is always to push yourself to do more. It’s important to strive for personal growth and to challenge yourself regularly. This means striving to fail at least once a month, as it’s a sign that you are pushing yourself to reach new heights. If you haven’t failed in the past six months, likely, you are not pushing yourself hard enough. It’s also important to step out of your comfort zone and try new things, even if it makes you uncomfortable. He also emphasizes that the product or investment you are considering to invest in should be good and not something that is not worth investing in, to avoid any catch-back in the future.
How Pranay Could Have Gone Bigger at the Beginning
Pranay and his team are happy with their approach, and he wouldn’t have done things differently. He talks about a recent deal they made, and even though it was small, it was a perfect fit for their current need. He acknowledges that timing is also a factor in investments, as the end of the year tends to be slower as people try to offset gains or make up for missed opportunities. He also mentions that the end of the year is a busy time for people to make up any investments they might have missed earlier in the year.
How Pranay Has Grown His List
Pranay hired an agency called Interview Valet, which he finds excellent but expensive. He notes that it depends on whether or not he has a team to apply for him to be on podcasts. He mentions it’s hard to determine a clear return on investment and that it provides credibility but may not have an immediate ROI. He expresses that he enjoys talking to people and that one of his goals is to meet interesting people through his own podcast and guest on others. Pranay mentions he has used Facebook ads and sponsored conferences and has a media company that provides him with free advertisement. He suggests that his cost for acquisition would be higher without the brand he has.
Pranay created a podcast called From MD Podcast that discusses his journey of becoming an entrepreneur. Pranay mentions that many people from first-generation backgrounds, especially their parents, tend to want them to become doctors, lawyers, or engineers. However, Pranay explains that becoming one of these professions does not necessarily mean that one has achieved the life one wants and that, despite the decent salary, these professions still involve trading time for money.
The podcast covers his entrepreneurial journey, including his experiences in multiple businesses, and features interviews with industry experts who have accomplished interesting things. He aims to present a balanced perspective on entrepreneurship by discussing various topics, such as the effects of past traumas on potential and the loneliness that can come with being an entrepreneur. He also mentions that he believes there is a culture now of people looking for side hustles or side gigs and that often only the positive aspects are emphasized, so he wants to present a holistic view of entrepreneurship.
Pranay’s Future Plans
Pranay is interested in becoming a venture capitalist in the real estate industry. By doing so, he would have the opportunity to invest in a diverse range of real estate projects and companies, including those for which he may not have prior experience. He believes that by providing capital to these projects, he could help support those who may not have traditional access to funding, such as minority-owned businesses or those in underinvested communities. He is excited about the potential to be more inclusive and take more risks by investing through a fund structure. Pranay is currently working towards building his experience and resources to move towards this goal.
To connect with Pranay:
Ascent Equity Group Website: https://ascentequitygroup.com/
Pranay’s Email: email@example.com.
From MD Company Website: https://www.frommd.com/
Apple Podcast: From MD Podcast