You may have heard the idea that only 20% of what we do in business produces 80% of the results. And it follows that if you identify the right 20% and focus on that, you can scale a syndication business fast. But what does that look like in practice? How do you apply the 80/20 rule to make decisions around how to spend your time?
Endorsed by Forbes and Inc. Magazine, Perry Marshall is one of the most expensive business strategists in the world and the creator of the world’s largest science research challenge, the $10M Evolution 2.0 Prize. Perry’s reinvention of the Pareto Principle is published in the Harvard Business Review, and he is the author of eight books, including 80/20 Sales and Marketing and Memos from the Head Office.
On this episode of the Financial Freedom with Real Estate Investing, Perry joins cohost Garrett Lynch and me to explain the concept of the Pareto Principle and discuss how it applies to real estate syndication. He describes how we can leverage the 80/20 pattern to scale an investing business, challenging us to focus 50% of our attention on the right 1% of our investments. Listen in for Perry’s advice on identifying and marketing to the right investors and learn how YOU can use the 80/20 rule to prioritize your time as a multifamily syndicator!
The concept of the 80/20 principle
- Originated by Italian economist Vilfredo Pareto
- Identified 20% of people have 80% of wealth
Perry's realization re: the fractal nature of 80/20
- Pattern of 80/20 inside every 80/20
- 1% of customers make 50% of purchases
How a syndication businesses can scale using 80/20
- 1% of investments produce 50% of profits
- Focus half of attention on right 1%
How to identify the 20% of investors to focus on
- Make prospects DO something to qualify lead
- Focus marketing on 20%, then repeat process
Perry’s insight around the 20/120 rule of business
- 20% of activity makes 120% of revenue
- Bottom 20% takes you backward
The message in Perry’s book Memos from the Head Office
- Tap into spirituality and faith for decision-making
- Listen to insight from God to resolve conflict