After reading about the Australian Software Company Atlassian trading on Nasdaq today, I started thinking about all the "Unicorn" companies (start up companies that have achieved a 1 billion valuation or higher from venture capital and aggressive teams) in comparison to the companies that have returned their entire funds to their investors through conservative growth. Atlassian happens to be a company that has bootstrapped their money from the beginning by distributing their products online and promoting themselves through word of mouth. In the world of commercial real estate, spending on marketing campaigns, listing and research services, office space, etc., could be putting money out the door faster than it is coming in. Most of us do not have venture capital backing us, so we need to rely on those sales that pay the bills and move us ahead conservatively - thus bootstrapping. Or perhaps you have made that deal that has given you the opportunity to take that gamble, which in turn has paid off quickly. Nowadays, it seems that agents are taking on more responsibility in order to receive that higher split. Same goes for the majority of clients that we deal with day to day. Those clients who are looking for a quick return on their money. Who isn't looking for that 10 cap? In the long run, will they regret the decision to invest in something that may or may not work out? Are they willing to take that risk for the ultimate reward? Or is it safer for them to hedge their bets to ensure against loss? Thus are the woes of commercial real estate. Either way, you owe it to your client and to yourself to be honest in your numbers and proficient in your transactions. It is important to let your client know, that similar to the stock market (or other investment opportunities) - if they are looking for higher returns there will be higher risks associated.
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