The 2-6-2 Rule: How a Batch of 10 Land Deals Actually Lands
I tell every new operator the same thing before we ever wire a dollar: out of every ten deals, two will be home runs, six will be average, and two will be duds. The duds aren't the problem. Pretending they won't show up is.
The exact split, in plain English
Here's how I actually phrase it when an operator asks what to expect:
"I told him when we started: out of every 10 deals, two are going to sell immediately for full asking-ish. Six are going to be pretty average, and then two are going to be duds. And so we're in that life cycle where he got the home runs, he got the average deals, and then now there's one or two duds left and he's annoyed." — Drew, on REtipster Podcast (Jan 2026)
That's not pessimism. That's the actual distribution I see across hundreds of funded deals. The home runs are great. The average deals are the bulk of the business. The duds are the cost of doing volume.
What the duds actually do to your math
Most operators run their numbers on the average deal. They forget to weight the duds in. So when the duds show up — and they will — they panic, and they start blaming the funder, the market, the title company, anything but the math.
If you assume two out of ten will break even or lose, your blended expected return per deal still works across our sliding scale (75/25 on fast closes, 50/50 by day 180). If you assume zero out of ten will lose, you're underwriting a fantasy.
| Bucket | Of every 10 deals | What it looks like |
|---|---|---|
| Home runs | 2 | Sells in days at full ask. Funder and operator both happy fast. |
| Average | 6 | Sells in 30–120 days at or near asking. Predictable margin. |
| Duds | 2 | Sits, gets re-priced, may sell below acquisition. The money you make on the home runs covers these. |
Why the operators who plan for the duds outlast the rest
Here's the part that surprises new operators: the duds aren't catastrophic if they're already priced into the model. The disaster scenario is when you blow your whole capital reserve into eight deals, four of them go dud, and you have nothing left to fund the next ten where the home runs are hiding.
"He got the home runs, he got the average deals, and then now there's one or two duds left and he's annoyed. And then I'm feeling annoyed because I feel like I educated him properly where I told him that this was going to happen." — Drew, REtipster Podcast (Jan 2026)
How I underwrite around the 2-6-2
When I'm sizing a JV with an operator, I'm not asking, "Will this deal sell?" I'm asking, "Across the next ten deals we'll do together, will the math survive a 2-6-2?" That changes how I look at any single deal. A small dud doesn't kill the relationship. A pattern of duds — that's a different conversation.
What this means if you're submitting your first deal to us
Don't pitch me one perfect deal in isolation. Pitch me the next ten, with the duds priced in. That's the operator I want to fund.
Submit your next batch of deals
We underwrite the relationship, not just the deal. Show us what the next ten look like.
Submit a deal →