There’s an old saying, “It’s not what you know, it’s who you know.” In the world of private lending, that rings true more often than not. Now, I’m not saying you should throw out everything you know about lending, but when it comes to growing your business, making the right connections can open doors faster than a perfectly executed term sheet.
As we gather at the American Association of Private Lenders (AAPL) Conference, surrounded by some of the brightest and sharpest minds in the industry, it’s the perfect time to remind ourselves of the importance of networking. In a field like ours, relationships can make all the difference between a deal falling flat or going through smoothly like butter on a hot biscuit.
Let’s walk through three key reasons why networking is more than just a good idea—it’s essential to success in private lending.
Relationships Build Trust, and Trust is Everything
Trust me on this one: lending isn’t just about dollars and cents. It’s about trust. Building relationships with colleagues, partners, and potential clients helps establish that all-important foundation of reliability and respect. Studies show that 85% of jobs are filled through networking, not traditional job listings. Now, I know we’re not talking about hiring here, but this stat highlights one universal truth—people do business with those they know and trust.
When you’re in a lending relationship, trust makes all the difference. Whether it’s ensuring borrowers repay or collaborating with another private lender on a larger deal, those personal connections foster the kind of trust that helps keep both parties accountable and smooths out any rough patches.
A Strong Network is a Safety Net
Let’s face it—sometimes, things don’t go as planned. Deals fall through, markets fluctuate, or you find yourself at a crossroads wondering where your next opportunity might come from. Well, having a strong network means you’ve got people in your corner to help you weather those storms.
It’s been found that 70% of people believe their network is vital to career success. In private lending, having a diverse range of contacts—fellow lenders, real estate professionals, financial advisors—creates a safety net. When one door closes, someone in your network might just open a window for you.
And let’s not forget that networks are two-way streets. As much as you benefit from your connections, offering a helping hand can come back to you tenfold. A reputation for generosity and collaboration is worth its weight in gold.
Innovation and Growth Happen Through Collaboration
AAPL brings us all together for a reason: we learn, share ideas, and come up with innovative ways to grow our businesses. Networking is the heart of collaboration. That’s where those magic “aha” moments often happen. Maybe it’s in a conversation over a cup of coffee, or during a panel discussion, but bouncing ideas off others is what sparks the creativity that keeps this industry moving forward.
According to Harvard Business Review, networking with diverse groups outside of your immediate circle improves your chances of coming up with innovative solutions by 60%. Fresh perspectives help you think outside the box, and that’s what leads to growth—both for your business and for the industry at large.
So, as you shake hands and trade business cards at this year’s AAPL Conference, remember that these connections are more than just surface-level pleasantries. They’re opportunities to build trust, form a support system, and collaborate in ways that will benefit your business long after the conference lights dim. I firmly believe you can’t make it in private lending without building relationships.
