Crowd Funding For Women Real Estate Investors With Kaylee McMahon
Updated: Nov 30, 2022
Creating wealth through real estate investing is easier when you have an investment opportunity and convenient education. Because financial education helps create a financial mindset and other freedoms that will lead us to our path. In this episode, Kaylee McMahon, the Apartment Queen, explains the ecosystem, crowdfunding, and how you can get qualified to invest in helping us women on our path to financial independence. She also shares that path to financial freedom can be less scary if we have mentors or partners that can guide and help us through investing. So if you seek to invest with her, you need to take the qualification quiz to help her identify whether she is accredited or not accredited. Kaylee explains that they are launching and working on a crowdfunding offering if you are not qualified for the two. To learn more from Kaylee, tune in to this episode now!
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Mentioned on this episode:
Rich Dad Poor Dad by Robert Kiyosaki
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Crowd Funding For Women Real Estate Investors With Kaylee McMahon
We are joined by Kaylee McMahon, the Apartment Queen. If you have not heard of her, this is going to be a great episode. Even if you have, just read. Kaylee has purchased over $70 million in multifamily real estate as a general partner and a principal. She sold over $3 million in residential real estate before transitioning into her full-time syndication role. If you are into syndications or you want to learn more, this is the episode for you.
Kaylee is originally from Portland, Oregon. She moved to Dallas and founded the Women Who Invest Wednesday. It is a networking group and a podcast. The podcast is called #1 Leading Ladies, where she interviews women who are disrupting their industry and the real story of how they got where they are.
Kaylee's goal is to change the face of multifamily by bringing more women into the light as powerhouse operators, key principles, and limited partners. Her company's purpose is to create more female SheVestors, as she calls them, and givers by 2030. Without further ado, here is Miss Kaylee McMahon.
We want to invite Kaylee McMahon to talk to us and have a great conversation. She is The Apartment Queen. Welcome to the show.
Thank you all for having me.
Cami and I want to ask, how did you get started?
When I got started, the only access that I had was to males that were my mentors or sponsors because a mentor is someone that can put themselves in your shoes and live through the types of things in shoes and challenges that you have at the time. For example, we go through childbirth, menopause, and divorce but on an unequal side of things. We go through stalking, revenge, and many things that we deal with that are unique to being women.
I wish I would have had access to a female mentor at the beginning. That person would have helped me a little bit more to focus on building a more balanced lifestyle and being able to see some problems that could potentially come my way that has nothing to do with multifamily real estate personnel in our lives as women. I had a very optimistic view about I'm going to go find other women and partnering with them, and that was good enough. No, you still need to trust but verify.
Trust but verify, no matter who you partner with.
That is something that that still exists no matter whom you partner with. That was something that taught me a lot of large lessons. I'm still learning some. Depending on the type of person in the lens of who this woman could have been, for example, if they were in a culture index sense of things, the architect, somebody that would have seen this stuff coming from a mile away. I'm such a visionary and optimist. I live up here in the clouds. I didn't see it coming. That is what I wish I would have had.
When you started, you were working with sponsors. That means you started as a passive investor.
Yes, but not in multifamily. I started as a passive investor in house notes and at the same time, I was actively flipping houses.
Cami and I weren't sure how you started. Camille, you had a question about that.
Did you start in single-family, and jump up to multifamily? What is the timeframe, and how that process happened several years ago?
I started somewhere because I read it in Rich Dad Poor Dad. Let's flip some houses, and I got exposed to the network of real estate investors as a whole. I realized there was much more opportunity out there. It comes down to what you want to accomplish. I had the vision of having a self-running B-type business and the ESBI model in the Rich Dad Poor Dad book, a self-run large business. I knew that single-family couldn't get me there, and I couldn't make an impact fast enough. More zeros, doors, staff, help, and partners were going to get me there.
That is what turned me on to multifamily and also meeting somebody who was in this industry but at the time came across as someone who used their celebrity for good, well-balanced, understood human beings, how to take care of people, and do the right thing. I thought that that was how everybody was in this industry. It’s getting exposure through single-family investing education networks to, “There is all this other stuff to invest into.”
When you say education networks, tell me more about that from your perspective because, as the Apartment Queen, that is something that you are doing now, educating women.
Not me particularly, but we do have a network, and that is part of our ecosystem where I partnered with other organizations that specifically work on financial literacy, specifically work on how we educate women who want to do single-family investing. They want to do single-family investing and multifamily. They have resources. They have never been part of a big group.
I don't like the culture in these big groups where it is all about gossip and talking about other people. That is not how I live my life. I like to talk about ideas, the future, other drama, and people. The network that I got involved in was an investor-funded education network called Propelio at the time. They changed names now. They are doing more blockchain and more private equity education, but at the time, it was Propelio.
They reached out to me to speak and I happened to see all the other types of education they had available. At the time, I was talking about, “We are flipping a house. I'm becoming a broker. I'm getting involved in multifamily.” You got to watch my progression a little bit quickly over a couple of years with the speaking opportunities that I had with them. They have all these other individuals that do notes that do multifamily, mobile home parks, triple net million, and different things.
When you say an ecosystem, do I have to be a multifamily investor to participate in any of that, or what are the different parts for me if I'm single-family or if I'm multifamily?
We are still building out the last piece, which is working with nonprofits because I have lived in it will speak from my experience. I had to take care of my basic Maslow's hierarchy of needs before I was even able to get going. Do I have a safe place to live? Do I have income? Am I dealing with or finished with addictions that I have dealt with? Have I separated from abuse? Have I finished my divorce? You are in a stable place.
Once you are in a stable place, we have opportunities for women, and it doesn't have to go in this order because we are all in different phases of our financial literacy journey. We do have a group that we partner with called Financial Literacy For Her, which works on basic financial literacy. I may not be in that phase, or after that, what I see is, “Here is the issue that was stopping me from investing.” It was a basic understanding. It was like, “I have all this debt. How am I supposed to be investing if I have all this debt to pay off, whether it was from school, divorce, or personal debt?” We got to get ahold of that.
We have a coach that keeps you accountable to get you out of that. We have somebody, if you are even past all that stuff that they are going, “I understand how to take care of myself when it comes to my finances, and I want to invest. I maybe have $5,000 or $10,000. I don't have the $50,000 that is normally necessary to invest in this industry.” That is BS. The buried entry was high that you had to use your IRA. I can when I'm 50, but you have missed the compound interest curve your whole life.
Working with an organization that helps the education piece to figure out with your money available and time available, what would work for you to do single-family, multifamily, passive or active? Powerhouse women help us to figure that part out for each woman, and they are ready to invest in that means single-family and multifamily.
They offer group flips for single-family, and they offer group investment for multifamily. Where we come back in is providing some of the deals that they invest into as a group. There is a fifth stage that is once you have decided that maybe your path was, “I went active, and I went multifamily active. I want to do this as a professional fund manager full-time. That is what I do now.”
I would personally mentor somebody to work with them to set up their fund to get them the CPA that they need to make sure that their financials and audits are correct. Partner with them in that aspect because that is what I do now. The piece that we still have missing because of amazing things that have happened in my life and what they are going to be patched up pretty soon is how do we appeal to those women who are working on getting their Maslow's hierarchy of needs met, but they’re mean. They are tough, and they think, “I don't need help, counseling, and resources.”
Not everyone is living under a bridge. There is a certain phase where maybe it looks okay, but it is not okay. The point is partnering with those groups that give those resources to women to where they can take care of themselves, get ready to get educated and get to investing and creating generational wealth for their families.
I'm impressed that you were that you did this all in several years because it takes a while for us as women to learn how to have other people help us and bring in partners. We want to do it all ourselves. The faster that we can learn to have other people do what they are good at, the faster we grow and get bigger faster. I'm impressed with your drive and with your motivation. It seems like you are fearless.
At the same time, I still have fear. A cofounder of one of my companies and I were having a talk. I said a few things, and he was like, “You are getting defensive.” I go, “It is because of my fear straight up. I have this list of positions that we need to fill within this company. Here is what the world is telling me I need to do. Here is what we need because of the problems we have identified in our industry. We have to solve those. How do I even ask for a COO because I don't have those skills?” I'm an ideas person, and I have been doing a little bit too much for a long time. There is explosive growth that we could have had.
Some of the things that I had to go through losing everything, being threatened, and being through all the legal things that had to happen for me to be able to have confidence, which is that fearlessness, you pick up on but also, I still struggle with it. Being able to go, “Whom do I ask for help? Who is the right person? How many people do we need?”
Long story short, go look at your gaps of what you hate doing or what they hate doing if you are not great at it. I'm like, “We need a CFO because I don't do that. We can do fractional because I'm a startup. I can't do a full-time salaried person.” There is a way to do this. You have to keep asking questions as you go and be okay with not knowing.
It is a little scary. The next step for me is going to be working with a business consultant because we are ready to scale. I know what it takes to make basic money off of what we do. It is a constant iterative process. We are constantly changing, learning, and adding. What makes it less scary again is having a coach, but whom do you trust does a great job? I have been fortunate that based on my readiness and all the stuff I have been through and people I have had slot off in the process because they are not in alignment with my values, where I want to go, or helping me grow, and I have to let them go. A lot of losses happened, but things have filled themselves in.
What I needed was somebody who was the president of a major company that could be either a partner or a board member in some sort and say, “I care so much. I'm passionate about what you do that would take half my fee per hour or take equity or a combination versus paying someone $5,000 a day to business consult, structure everything for us, and hire for us.” This is someone that I didn't even know what I should say because I didn't want to jinx it, but she was looking for me, which was the cool thing. I’m like, “I had your name in my head for the last month, and I happened to run into you when you were at dinner with somebody else.”
Cami and I have found that same synergy. I'm a business consultant. I work with real estate brokers and investors to fix what is wrong with their business, back-office operations, and hiring. That is all me. Cami is a practitioner. She gets out there, buys properties, gets it done, and deals with contractors. She is boots on the ground dealing with it. As women, when we don't have somebody to balance us in our business, we feel we have to wear all the hats. We have to do it all. We don't realize that we are the bottleneck that is stopping the growth and the scaling of the business. You have to have that piece so that you can grow.
Cami and I also were discussing this. If our purpose is greater than ours, our purpose is to impact as many women as we possibly can. We can't be limited by our own personal limitations. That is what is happening. Tell us if a woman wants to be impacted by you, Kaylee. She wants to be involved in what you are doing. One of our readers is saying, “I want to get involved. I want to invest. How do I get qualified to invest with you or work with you?”
That would depend on where you are in life. That is why we have this qualification quiz. That is basic to figure out if you are accredited, not accredited, or sophisticated. Those mean different things. Super high net worth is accredited, but if you have a different financial planner license, there are series 65, 83, and another one, you are not considered accredited. There are a couple of other ways to do it, but that is one status. You can qualify for everything to invest in.
They’re sophisticated. You have substantial knowledge of the risks and benefits of real estate to invest in. We are launching and working on a crowdfunding offering, which is for those who don't qualify either. Because of the high barrier to entry typically into this industry, it keeps a lot of me out. When I got started in my early 20, there was no way I would have been able to do more than $5,000 investing in something. We are looking to solve that problem. Getting qualified would be the first step to figuring out as far as investing what you qualify for. If it is none of them, that is okay too. We have other partners that can help you get there, but you need to know that is what you want and make it go.
This is what I heard you say to recap. Accredit it, and if you are accredited, you will know that you are accredited. Typically for most women, if you have a certain affluence or amount of money, that is where we would look, and the SEC regulates that. Is that right, Kaylee, as to what the accreditation rules are?
When you take that quiz, but we have it in the subtext of the question in the quiz, what would qualify as or at the SEC's website because they did expand it in March of 2021, where 12 million more households are considered accredited. I expand a little bit, but still, to this point in time, 88% of the US is not.
The next level after that is sophisticated. For those who are not sophisticated, the next level under that would be crowdfunding, which has a much lower barrier to entry. It sounds like you guys are starting something that would allow you to get in for $5,000. Did I hear that right?
That is the minimum. There are different share classes that we offer, voting and non-voting, and men and women. That fund is meant for promoting females being able to invest. The men that invested have to bring in a mentee with them. They can have five, I don't care, but they are part of their subscription document. If you are investing less than $25,000, you are a non-voting member.
When you are doing $25,000 or more, there is a chart that when you go to that platform, we are going to use Crowdfund Mainstreet that will identify based on your net worth and income. It caps you at a certain place because it is trying to watch out for your general investor, who doesn't have as much knowledge. If something does go wrong, it doesn't change your life. The point is that there are two different classes, voting and non-voting, but we are looking to either way lower the barrier to entry.
Camille, do you have questions?
It is obvious that you want to support women. You talked about battered women. You want to grow and a man has to have a mentee to come in. What is your overall goal? Is it to bring people along in the process? What is your vision for all of this?
The BHAG, we call it internally, the Big Hair Audacious Goal is to create 1 billion SheVestors by 2030. We haven't identified 100% how to do that. That is another problem-solving thing we are working on because when you did typical investing at $50,000 per deal for 20 people, it is not that many. When you do crowdfunding, you can start folding in more people. That is still 5,000 people. It is still not enough.
When you do crowdfunding, then you can start folding in more people.
I'm still iterating to figure out exactly how we are going to do that. Part of it may come into play when I'm working on getting into the tech industry. Not to go down too much of a rabbit hole, but there are ways that you can increase shareholders. The point is that we are trying to figure out exactly if that means you have to invest in the asset. Probably not.
The idea is to create women that are financially independent and are investing. Whether you own equity in this or want to be a Google-type company, you invest in real estate, or in our operating business because we are going to have to seed round at a funding round for our parent company, The Apartment Queen Investments. Either way, you are a shareholder and you get dividends and tax benefits. We are still iterating that. The idea is 1 billion SheVestors by 2030.
We want to help you with that, and we want to figure out ways to add value to work with her to have our Wealth BuildHERS community connect with you and with your community. We can keep this impact going to get those 1 billion. My thinking was 1 million women. We could jump on this. Tell us, Kaylee, how do our readers connect with you? How do they find you? How do they participate in crowdfunding? Where do they go for that?
You will probably get a little overwhelmed. You can always visit and then come back to TheApartmentQueen.com. There is the main page that says, “This is how the process works.” If you want to dig deeper, go up to Investor Resources and come down, we have a lot of resources. It is a little overwhelming whether it is a book, podcast, or generational summit. We have the Women Who Invest Ecosystem that is specifically for women who invest in all kinds of different things. We get together in person and online to share and invest with each other. There is quite a bit there.
Check out the website, and there is a button that will follow you around the whole time. That is how you get qualified. We do have a page again. We are rebuilding it to go into the guts of why we started the fund and why it is named after my grandma. That is in that dropdown, but it is under construction. There are a lot of resources for you.
We can't let you go without asking about grandma. Tell me about the fund.
My family is a tough topic to talk about because I'm still trying to figure it all out. My grandma is my mom. She has been the one. I lived with her when I was young, like 2 or 3 years old. My mom was finally able to move out on her own but moved in with somebody else that took advantage of my sisters and me our whole life. That person has now been removed and is in jail.
My grandma, through the entire process, has always told me, “I believe in you. What are you doing? What are you thinking that you want to do or have been curious to promote?” Even in college, when I was struggling, she would send me care packages. For Parent’s Day, they came and visited. She got her own issues and things that she maybe didn't deal with growing up.
I'm working through all of it mentally, but that was a person that still had that bug in my ear and planted that seed that, “You can do it, I care about knowing what you are doing, and I want you to keep going.” She was the person that planted that seed in my early years. The fund is called Vernafund20, and there are a couple of different entities but it’s VernafundD or VernafundCF LLC. I did name my first fund after my grandma.
Thank God for Verna.
Thank you for sharing that and being vulnerable because we all have that in our lives. I have people in my family, I won't share names, that the same thing has happened. That is why you are doing what you are doing.
You can't create change without vulnerability and authenticity. I will answer your question straight.
We are not going to keep you any longer. We are grateful for your time and for you to come. Everybody who wants to reach out to Kaylee, you are at TheApartmentQueen.com. You can go there. We can find the questionnaire, get all of our questions answered, spend more time with you and learn more about what you are doing. Thank you so much for your time.
Thank you, ladies. I look forward to talking to you soon.
About Kaylee McMahon
Kaylee has purchased over 70 million in multifamily real estate as General partner and principle. She sold over 3 million dollars in residential real estate before transitioning into her current full time syndication role. Originally from Portland Oregon.
She founded the Women Who Invest Wednesday networking group in Dallas, which is also digital, and a podcast called #1 leading ladies where she interviews kick-ass women who are disrupting their industry and the REAL story of how they got where they are. She is developing technology to help make it easy and convenient for women to learn how to make passive income through apartment investing-the Shevest app.
Kaylee has done home flipping, note buying, active / passive investing in apartments, and sometimes is her own lender as she feels that to be truly confident in giving advice, one should NEVER take advice from someone who has never gone through these things themselves. She is always learning about multifamily business models to get her and her partners the best return on investment.
The entire backbone of what gets Kaylee out of bed every day is her “why”. At a 30,000 foot view, it is to create financial independence and space for those experiencing codependency and toxic relationships which hamper their ability to visualize and then manifest what their amazing reality could be. Her company culture models this why and is “Changing the face of multifamily” to bring more women into the light as powerhouse operators, key principles, and limited partners. We will create 1 billion more female SheVestors and “givers” by 2030.