All Topics / The Treasure Chest / What the APIM game was all about

Viewing 20 posts - 1 through 20 (of 27 total)
  • Profile photo of Steve McKnightSteve McKnight
    Join Date: 2001
    Post Count: 1,763


    I have been reading some comments about the game we ran on the Sunday of the recent seminar and thought that I would make this post to clarify a few things.

    First, having now read through your feedback forms, it is clear that a number of people found the game confusing. This is a little strange because this is the third time we have run it and the only time that there has been so much confusion.

    I think this is mainly because I did not have the time to properly debrief the game at the seminar as time was against me on the Sunday.

    The objective of the game was for you to realise that all the theory in the world is great, but unless you have the application then you will never get anywhere.

    There were only two vendors – Dave and me. We expected there to be lengthy waits, which was to represent that it is difficult to find deals in the market at the moment.

    We also did this so that people who bought a property first would find the going hard.

    My suggested way to proceed with the game would have been to first go an interview all the tenants and then see which person had what housing need.

    The rent that s/he would pay, or the structure of any creative deal they were willing to enter into would then determine your maximum purchase price.

    What I certainly found was that people would come up to me and try to negotiate a discount, just for the sake of negotiating a discount.

    While this is all well and good – if you can make money and pay full price then haggling might actually be counter productive (this was actually one of my investing a-ha’s along the way to buying so much property).

    While the goal was to have four deals completed, this was next to impossible to achieve in the time frame allowed.

    What would have secured your success was to develop a plan. The way to do this would have been to:

    1. Decide on your investing strategy. That is, capital gains (which meant you would have done the reno), or positive cashflow (buy and hold, lease-option or wrap).

    2. If it was capital gains then you needed to go and talk with the renovator (Stuart) and ask him how it all worked. The answer was that you would make a 20% capital gain on the money that you spent, but you would have been out of the market on that deal for 20 mins while the work was completed. This strategy would have been cashflow intensive unless you negotiated with a financier to lend you some of your reno cost.

    3. If you wanted a +ve cashflow result then you would have needed to go and see the tenants and ask them (ie. prequalify them) to see what strategy would best fit their circumstances. Ideally you would have then used the 11 sec solution (based on their affordable weekly rent / repayments) to work out your maximum purchase price. Because I was so busy, you probably only had one or two shots to try and buy a home.

    4. Once you had bought a home then you needed to negotiate with financiers etc. to get the deal over the line and then also write up the numbers and hand your card to the accountants.

    What Most People Did

    As to be expected most people went forward with no strategy and just went out to buy a house… any house and then hope that they could form a deal around it.

    That’s OK, but it would have meant that the game was confusing. Let me be clear – this is because if you do this in real life you will also find your investing to be a stop/start journey.

    What I found was that people would haggle with me and if I didn’t budge then they wouldn’t buy. Ultimately, if this was the approach then nothing would have been learned because your stubbornness would have cost you a learning opportunity.

    The real aim of the game was not for you to succeed or fail as such, just to attempt to stand back from the panic, adopt a clear head, design a strategy and then go for it.

    Ultimately the ones that did this went part of the way to making headway. The ones that didn’t just became disheartened.

    This was no fluke… it was supposed to be this way because that’s what the majority of people will do following on from the seminar…

    That is, they will see the property as the real asset (despite what I went to great pains to point out in session two), rather than first forming a mission, then a strategy, tactic and action plan.

    So having read all this, has that helped to clarify the game? I hope so, but please offer feedback if you require specific help.


    Steve McKnight

    Remember that success comes from doing things differently.

    Steve McKnight | Pty Ltd | CEO

    Success comes from doing things differently

    Profile photo of LittleMermaidLittleMermaid
    Join Date: 2003
    Post Count: 9

    [:)]Hi Steve,
    I must say that I found the game on Sunday a little frustating at the time probably because I am a rookie and had not experienced anything like this before. I have bought and sold quite a few homes over the years but only as principle places of residence, so when I read your e-mail then, I realised what your aim was. Clever!!! Our team actually did have a strategy and found a tenant, the money and a deal for a reno but ran out of time so I felt a little more comfortable after reading your explanation. I loved the seminar. I learnt so much and am in top gear. Thankyou so much.
    Little Mermaid

    Profile photo of DaveCDaveC
    Join Date: 2003
    Post Count: 79

    Hi Steve

    I have to admit that I found the game a little frustrating as time was just flashing by. I genuinely believed that we would be able to do four deals within the hour but ultimately our group didn’t succeed in completing one…..

    Thank you for your feedback on the game…….lesson learned!!!

    Take care

    Profile photo of Dianne2Dianne2
    Join Date: 2003
    Post Count: 19

    Thanks Steve. Because we had played the game in Sydney we were aware of the reason for the chaos, and also aware that it would do our companions on our table no good to just take charge in order to win. So they would benefit from the game, we encouraged them to make the decisions (with some leading questions) about what needed to be done, but our table also ran out of time to actually buy a property by the time they had sorted out the plan, found the various tenants and so on.

    Maybe the next time you could have a few more sellers so that the participants can get through at least two house purchases to enable them to experience the impact of their decisions?


    Profile photo of Lizzie_2Lizzie_2
    Join Date: 2003
    Post Count: 20

    Hi Steve,
    I think you have hit the nail on the head when you said you didn’t have enough time to properly debrief us about the game and it’s objective.
    I do feel better after reading that we were meant to start with a plan as that is what we tried to do. In the chaos we decided that because we didn’t understand exactly what we were doing we’d go and seek advice from the accountant. For a fee of $500 accountant Julie helped us out heaps. We then knew that the first port of call was the tenant – it all comes back to people first, doesn’t it.
    Thanks Steve.


    P.S.Hope you don’t think that third time round you got the duds.

    Profile photo of YarraYarra
    Join Date: 2001
    Post Count: 20

    Hi Steve
    The game went a long way in helping overcome a number of fears in just getting out there and doing it. Roleplay is a wonderful way of experiencing life in safety.
    Can I make a suggestion that someone (I would volunteer but at the moment I am working 16 hour days)organise game nights where participants can hone their skills and develop new ones? (Brent did a wonderful job of Cashflow parties)
    Anyway maybe others have thoughts on this?

    Profile photo of brentbrent
    Join Date: 2001
    Post Count: 165


    Hi Steve
    The game went a long way in helping overcome a number of fears in just getting out there and doing it. Roleplay is a wonderful way of experiencing life in safety.
    Can I make a suggestion that someone (I would volunteer but at the moment I am working 16 hour days)organise game nights where participants can hone their skills and develop new ones? (Brent did a wonderful job of Cashflow parties)
    Anyway maybe others have thoughts on this?

    Hi Martin,

    Thanks for the compliment.

    I’m more than happy to run another Cashflow evening if there’s demand for one.

    Is this something which many people would be interested in?


    Brent Hodgson Admin

    Profile photo of TomTTomT
    Join Date: 2002
    Post Count: 3

    Hi steve,[:)]
    Tom T from some of your earlier sessions.
    what you said is correct, they obviously did not appreciate how difficult it can be sometimes when you set out to buy a property.

    AS an example i have just posted an item on the site about Hamiltion Island properties for sale which at first site seem like a great return and long term investment. The reality is that once you have analysied the deal and looked at all the real costs and returns plus the downsides, the deal becomes very ordinary and not worth it.
    the only person making out in the deal is the vendor.
    as you pointed out on various occassions it is all in the deal and the negotiations as to what you get in the deal and how good that becomes
    the harder you push and the more creative you are the better the deal and the better the cash at the end
    nice to read and speak to you all again
    Tom T

    Profile photo of SooshieSooshie
    Join Date: 2002
    Post Count: 974

    Hi all,

    I had fun role playing, but I analized (spell check on wish list [:D]) the situation and thought about my role later. Learning curves and curve balls… Actually I used to pitch great curve balls when I played baseball [:0)] (a while ago now).
    I’d like to do some more situations, so Brent, sign me onto the list.

    Sooshie [:)]
    (20 minutes to Star Trek)[;)]

    “Giving is a Blessing, receiving is the bonus”

    Profile photo of NessieNessie
    Join Date: 2001
    Post Count: 73


    I was going to remain tight lipped because I thought that it was just me that had a problem with the game, but as others have made comments I have decided to make a contribution. I had played the game last year and was very confused then. But this time round I was totally frustrated even though I had a plan to follow.

    I know and fully understand why there was only you and Dave selling properties – short supply – hence the long queues. However, the one aspect that I felt was not considered is that most people deal with RE Agents when buying property. There are usually no queues at the RE Agents door nor is every Tom Dick & Harry listening to what you are discussing with an Agent nor can they jump the queue as some people were doing during the game.

    The game for me personally was the biggest let down of the weekend. I had been so looking forward to playing the game. I didn’t get to buy a property because I was jumped in the queue several times.[:(!]
    I actually then stepped back and just viewed others in the room and was amazed at how and what people did. [:O] This was a lesson in itself.

    I would certainly be interested in game nights if you decide to run them.


    Profile photo of The DIY Dog WashThe DIY Dog Wash
    Join Date: 2003
    Post Count: 696

    Hi Brent

    Matt and I would deffinately be interested in a cashflow and or role playing night.

    Maybe you could get some real Real Estate Agents along (not that Steve and Dave weren’t any good[:P]).

    I think that in hindsight we “all”, including Steve & Dave, got ‘something’ out of the game.

    Leigh K

    Read, learn, grow but most of all just do it.

    Profile photo of fastainvestafastainvesta
    Join Date: 2003
    Post Count: 14

    To steve and anybody who felt as frustrated and p***ed off as I did after the game at not being able settle on a purchase.
    That was the Ha Ha for my weekend[:)]
    When I got back to my motel room that night I went over the whole game and in fact the weekend. I basically worked out exactly what Steve points out at the top. This can be very frustrating, and we did not start out with a strategy. In fact we did not start out with a plan at all. – Lesson 1
    Lesson 2, it will be frustrating and time consuming and require the investment of a lot of energy to be successful, but to achieve, you must start!
    Lesson 3, find those who can help and if necessary pay for it. It will be a small price to pay and a necessary step to success
    Lesson 4, thyere are a lot more lessons to learn!!
    Thanks Steve and crew.

    Profile photo of MoogieMoogie
    Join Date: 2003
    Post Count: 4

    Hello my friends,

    I have now played the game twice and I believe I had learnt from some of my mistakes of the 1st time round, where confusion and a sense of chaos was keenly felt and resulted in inaction.

    With the benefit of a little hindsight, my team planned how we would approach the game very quickly. We leveraged our team resources by multitasking as much as we could. We saw a tenant first and got an idea of how much they were willing to pay, then we purchased a property with the knowledge that we had invested in a person first and would NOT be in the position of having a property with no tenant.

    My team won the ‘best deal’ with an infinite cash on cash return which frankly was very surprising to me.. why ??? because if I remember correctly one of the winning criteria was the most +ve cashflow property… not the cash on cash return. Whilst great cash on cash returns is all well and good, in the real world the +ve cashflow is finite and I am more interested in how much +ve cashflow I can achieve in a deal as compared to how much money I had to spend to achieve it. Making one dollar with nothing in a deal is also technically infinite cash on cash returns but I’d sure prefer to spend some of my own money and get back thousands. So.. I get far more excited by a good +ve cashflow than an infinite cash on cash return. Cash on cash returns on its own is to my mind a poor indicator of success.

    I found that this time round I was observing the game just as much as I was playing it. Watching what tactics people were employing and how people acted under pressure was very educational.

    So.. lessons learned 2nd time round :-

    – Learn from your previous mistakes
    – Successful strategies of the past may not
    work at a later date, so use the ‘shaper’
    and fit the right tactic to the problem
    – Keep your cool
    – Leverage your time and resources
    – Keep an eye on the game whilst you play it

    I enjoyed the game. A debrief would have been helpful but as Steve said we were short on time.

    Happy investing to everyone.



    Profile photo of WilinvestWilinvest
    Join Date: 2003
    Post Count: 5

    Hi Steve

    I like many others found the game very frustrating. We did start with a plan and then all dispersed in pairs to arrange the deals. Whilst others were arranging to find the people, tenants, wrap clients etc. I was standing in the que to purchase the property.

    The team did come good with the tenant etc. Unfortunately, I did not purchase the properties until after the bell. I was also in the que for 45 min, watching que the jumpers as Nessie’s experience.

    I was finally ready to sit in the buyers chair and someone got the bright idea to call the fire drill (not a wise thing to do). As a very conscious work, safe practice person the only thing to do was to grab the gear and move out.

    Maybe this is my lesson learnt. Do not tolerate que jumpers and stand up for myself. I have only come to this realisation whilst writing this.

    I did however think that the hour could have been more productive, for me anyway.

    Thanks for the opportunity to think back on the situation.


    Profile photo of Gus_2Gus_2
    Join Date: 2002
    Post Count: 39

    Hi everyone,

    Time I think was our worst enemy. We did have a plan and it was remarkably similar to Steve’s. We interviewed every one and found our tenants, identified their needs, negotiated a rental premium if we could provide a service, we had access to funds via the bank and private invester based on our strategy…..etc but we couldn’t buy a house despite having members of our group waiting in lines for 20 minutes plus. I think we would have got there in the end, but we didn’t acheive the outcome within the time. We learned that it is difficult, but if we had our time over again, we would have been in the line to buy houses earlier. Relying on each member of the team to work concurrently on all the important facets of a deal would bring the rewards we had hoped for. Perhaps we focused too much on getting it perfect rather than getting into the market with something. Dave mentioned in his presentation on wraps that all you need is 1. A house, 2. A desposit, 3. Finance, 4. A tenant. Having most of this locked away quickly before you go shopping will enable you to pounce on deals (1. A House) when they arise. Stuart also mentioned this in his presentation.

    My business partner and I have taken learnings from the game, and implemented action this week to ensure we have points 2-4 locked away so that we can concentrate on finding the houses (with the help of the prospective tenant) to wrap. We should be able to pounce quickly as a result.

    Good luck everyone.


    Profile photo of JustinJustin
    Join Date: 2003
    Post Count: 18

    Hiya Steve,
    I think like many tables our group floundered early on in the game by wandering around without a plan. But we soon got our act together and realised what our prospective tenants/buyers wanted, and then jumped in line to buy a house……. and never got any further.
    We all had lots of fun though, and I know I personally learnt alot, both from our initial inaction and also simply by watching others as they questioned, bargained and listened to the different role players.
    Thanks to you and the team for an awesome weekend!

    Profile photo of RouveleeRouvelee
    Join Date: 2003
    Post Count: 4

    Hello All,

    I’m interested in the game nights that Martin suggested. I think it will help newbies like myself to understand the ‘property talk’ – as what people did when negotiating deals during the game. Thanks Steve for clarifying/explaining about the game.


    Profile photo of BettyBlockbusterBettyBlockbuster
    Join Date: 2003
    Post Count: 46

    Hi Steve

    Thanks for the insight. Our team did have a plan, but as with lots of other people we got caught up in the frenzy and I think the plans flew out the window. I was a bit frustrated by the process on the day but once I had time to reflect on it on the Monday I realised that the whole senario was what one has to deal with out in the real world and that there is an attitude out there that you can make $$ out of property but you have to hurry or you’ll miss out, so consequently people rush into bad deals just to have some of those brick and sticks.

    The exercise has equiped me with knowledge and strategies to move forward.Without lossing my hard earnt cash.

    Thanks again for the food for thought

    Betty Blockbuster

    Profile photo of dr housedr house
    Join Date: 2001
    Post Count: 281

    Dear Steve and David
    I did attend second time around, but found parts of it repetitive, having heard it before.
    It was nice to talk to like minded people though.
    May I suggest, dear Steve, if you are game to do this seminar again, pitch it at different levels, eg. beginners and one day each.
    Beginners can have their motiv. speeches, company structures, wraps, lease options etc.
    Advanced suggestions: case studies by members, what has or hasn’t worked,very interesting to me! Everyone does things in their own way and it is motivating to hear.
    Innovative ideas eg, looking at self-sell options, property subdivisions, how to do a joint venture, how to maximise your book-keeping.
    Wraps outcome studies, who defaulted, who brought etc.
    The last bit of the day I did not take part in this year, but watched participants for a bit.
    To me the value is questionable, too much chaos and lack of organisation.
    Perhaps get people to recap their strategies with their table and summarise people’s strategies at the end, if they wish to participate and be open about this.

    Profile photo of spider_2spider_2
    Join Date: 2003
    Post Count: 79

    [^]Hi Steve
    Thank you for clarifying things. I became frustrated with my group when they took off without getting organised first. In real life, I would be (and am) more choosier with my business partners. Some of the concepts were new/unfamiliar to me and using them so soon after being introduced to them confused me further. Back to the drawing board! I really enjoyed the weekend though and have much to work on.

Viewing 20 posts - 1 through 20 (of 27 total)

The topic ‘What the APIM game was all about’ is closed to new replies.