Throwing away your IT job for real estate w/ Agostino Pintus

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Podcast #197

 

0:00
So I walked away from a 20 year career and it like a sea level. Sea level it career I spent my whole life building killed it. So go all in on real estate. This is

0:15
a story about a dude named Lane he moved to the mainland and bought one place to stay. And then one day he went try to rent them out. And then he became one. That’s still me.

0:29
A simple passive cash flow listeners today I got I got snow pentas one of my partners of mine and we are going to get to know him a little bit better.

0:38
How’s it going? Oh, man, I’m awesome. psyched to be here. How you doing man?

0:42
Good. Good. Hit that subscribe pillow and mash up button hit the bell, right.

0:48
I know. I should get the bell up here. So I should do?

0:52
Yeah, so a lot of you guys don’t know what to talk about. We do this on YouTube, and we throw it up on there. So pretty much all My content today is found on the podcasts. It’s also on the YouTube, I’d say more stuff on YouTube these days. But yeah, let’s get to know you a little bit better. I guess you know how much simple passive cash flow Are you making today? And how are you doing that?

1:14
You know, right now everything’s invested in real estate, so I just do multifamily real estate Currently, I’m all in on multifamily. So, to that end, everything that we got everything that pretty much passively comes in is usually poured directly back into the business, right. So whether it be in terms of earnest money, whether it be in terms of just putting, you know, eating my own dog food, so to speak, put it into the deal itself. So really, I mean, aside from a couple hundred grand that’s pretty much it. And after all that I pour everything right back into the business, so it’s right now we’re in growth mode, you know, and that’s all I’m focused on at this point.

1:53
I mean, I had Mike mccalla Wits on the podcast recently he wrote the book. Profit first and I was telling him it’s like, yeah, I mean, we don’t really take a profit. We’ve just put it right back in equity and the deals and hopefully the magic happens.

2:08
That’s, that’s, that’s it. That’s it. I mean, the thing is, though, is that we’ve we’ve done a lot of deals, I know that we’re doing right, right now, we’re really, really good at picking the right deals. And we’re very, very careful with how we underwrite and how we get in on it. So I would say that I, it’s less about hope and more about we know what we’re doing.

2:31
This I think we do at

2:34
what point did you kind of come to this more abundance mindset side where you felt like you had enough money to put food on the table and, and you don’t have to worry about paying the bills with a salary. Yeah, man,

2:47
you know, well, a part of it is that with my journey, the way I did it was I used to have a corporate america job. I used to be a CIO Chief Information Officer of publicly traded companies did all that and it wasn’t Until, and I was also doing single family to at the time right long, like I’ve done six single family small multi family for 16 years. But I’d say about going on four years ago decided you know what? multifamily is where it is a friend of mine told me about multifamily and this is what it needs to be doing. So when I decided to transition from this single family, small multi family to doing big multifamily, that’s when first that’s where the spark went off is that I mean, I decided that’s what I’m going to be doing. And I gave myself a timeline, I gave myself a basically a goal. To say that on this day, I’m going to be I guess, I’m going to take out my last consulting gig and I’m going to focus on just building up the business while working at a regular consulting gig and packed up everything moved to Cleveland, Ohio, where I’m at right now and really got to work on working as a consultant and building this this multifamily real estate business and true to form just like I set out in my goals that I write every day religiously. I set up my goals to really define what I’m good at how I live my life that far off. That’s what I do. But I decided that that within within I think it was a 12 month period from making that decision. You know, I hustled man, I hustled hard, that’s what it took to get there.

4:26
And people always like to kind of understand you know, what were you in that situation where you finally made it? You know, say I was gonna go from single family to multifamily and more as an operator, then sure, passive investor, but like, How long were you doing the single family homes? How much how big was your portfolio at that point? So you decided and then how did the day job overlay on top of this? You know, were you kind of still working the day job while doing the multifamily kind of explain the the timelines holidays? Sure,

4:55
sure. Sure. No, I actually started single family 16 years ago, maybe a little longer when I was working at a company in Virginia and I was a CIO I was making great money and the reason why I got into multifamily or single family at the time and small multifamily was just to be a backup in case something happened with my job that’s the only reason why I did it. You know, wasn’t about it wasn’t about building legacy wealth. It wasn’t about trying to build something big is all about in case something happens I’m going to have some extra income right? So I started focusing on single family small multifamily and really tried to build that portfolio up. I think by time I finished up by time I left Virginia that no but four years in my started all that might have had like small portfolio like under under 100 units, like it would fluctuate between 80 to 100. And you know, nothing crazy, but then it was, but I I pretty much kept it pretty, pretty. flat for many years, just had some things going on in my life at that point and especially 2008 backed away from from all that. But I would say that the last job that I had brought me back to Virginia, I started selling off all my assets. And I was talking to a friend of mine, and his Real Estate Attorneys again going on about four years ago, he says, So tell me about hey, how who, who buys these big properties? Who how’s it, how’s it done? And he explained, multifamily syndication to me. So once I understood how it works, and what it takes to really put a deal together, I’m like, Well, I could do that. I work in corporate America. I’m not afraid of the numbers. I’m not afraid to do the hard work. So that’s exactly what I did. I just put myself I just got committed to studying every single thing I could find on multifamily syndication, syndicating deals overall, and got myself in front of some great mentors got myself in front of some great people that helped me build The business and that’s really what it took. You know, it’s not gonna say by any stretch, it was easy. But you know what? It was totally, totally worth 100% worth it you know now I’m all in on this real estate all in 100% on it.

7:14
At what point did you quit the day job in there was that

7:17
Oh, so so that was that? Yeah, so that was I quit the consulting gig, the one I mentioned earlier. It’s been three years now three years ago. And you know, I’ll tell you what lane I’m not gonna say it’s all sunshine and rainbows every single day of my life these days, you know, hey, there’s there’s everyone’s got a bad day ever. Sometimes they face some pretty bad stuff. But there’s not a single day I would ever I would never I would never even think about going back to that. Just I just don’t, I just didn’t think about it. You know, I, I am very pleased with how, how we’re growing the business and very pleased to partner up especially with people like you to really, really build something that’s really cool. You We got some cool stuff in the pipeline here that is just awesome. You only get to do that and build those opportunities when you really commit yourself wholeheartedly to to a project. So the only way to get it done

8:13
submit a lot of the guys this thing, they’re still in their day jobs. Or maybe they’re even haven’t even started investing yet. You can kind of go back to your single family home days. We call this the Han Solo moment. It’s like, you know, Star Wars Han Solo and Chewbacca or just lowlife smugglers and then Luke and Leia, you know, it could be the right people or the right idea. And then their their life to that pivot point for you. What was that pivot point? Or if there’s some kind of story from your corporate day that you can be like, that was the moment that change

8:47
my path? Well, you know what it was, it was happen a couple times, but it didn’t. It’s funny how it didn’t click, you know, till till the second time, really the first time when I was doing Working as a CIO as a young 3030 something year old guy working at this publicly traded company running global technology in my early 30s is ridiculous, right? It’s crazy. managing these multimillion dollar budgets. And I know like I said it started doing the single family thing. And when when things got when the company decided they’re going to make a change, even though the company was doing great, I was performing very well. My team was doing great, we were keeping it so we kept all the systems up and running, we’re innovating. The company decided we’re going to make a change. So they come to you and they say, pack up your stuff, get lost, you’re done. Now, I’ve focused everything I put my whole heart and soul into that company, right like any good C level executive or any executive for that matter, pretty much anybody listening you should be doing if you’re working for a company or you’re going all in on the company’s what you’re doing right? But what I did not do to my own detriment was really focus on building that passive income on my own for my own self and for my family. That’s where I did not do that correctly, you know, I should have I should not have relied on these, these outside forces to really take care of me and my family like I did. You know, that’s that’s what that’s what killed. That’s what killed me right there, you know, and allowing that to happen. not once, but twice. The second time, though, was was the time on I’m like, I’m not gonna do this ever again. I’m never doing this again. I’m not gonna put myself into the into predicament like this. And that’s why I decided that real estate was it because despite all the problems I had, over the 16 years that I’ve been doing this, from going to job to job to job trying to hold my head above water with these different companies. That real estate kept on throwing off money every month, every quarter every year. I’m not going to say that it was always like You know $100,000 a year coming in from real estate most saying that it was just passive income. But that’s one thing is for certain is that that money came in, you know and that’s that’s the thing I realized I’m like, you know what, I’m not doing the corporate thing anymore I might do one last gig I’m gonna do a consulting gig and I’m just gonna go all in on real estate So I walked away from a 20 year career in it like a sea level. Sea level it career, I spent my whole life building killed it. So go all in on real estate. So I mean, take some take some courage to do something like that.

11:36
For the first time they told you to get loss. Yeah, they told you to pack up you didn’t have any anything in your portfolio at that time then

11:45
I had like some single families and some small multifamily that’s it

11:49
well, at least you had the you had the kind of the proof of concept at that point, right. Yeah,

11:53
yeah. Yeah. Well, that’s exactly it. Yeah. Because even though and that’s the thing, though, it’s like they so they ripped me. I’m at home with Giant house that giant mortgage and car payments and I’m like, oh, man, what am I going to do now? Unfortunately, I still had some some money coming in, you know, to support me. But that’s that’s the power of the passive income, you know is that money kept on coming in, right? And help kept me above water thankfully because if I hadn’t done that, if I had discovered the power of real estate, man, it would be a different different life story we told you today.

12:26
So that time, how did your portfolio take the next step in the next like, month or two after? Well, anything changed like after that after that fire lit under your butt?

12:38
Yeah. Well, you know, the thing though to it, unlike some other people you might have had on your show for me, it was I didn’t add anything new. Right. I was because at that point in my life, my mindset was not was not set properly. Right. I was still thinking like an employee. Right. I was still thinking like an employee. Again, nothing wrong with thinking like an employee, but other than the fact that oh my god, I need to get a job, I gotta get a job like right now I gotta send out resumes right now Hurry, hurry, hurry, you know. So even though as an entrepreneur and as a kid, that’s all I ever wanted to be as an entrepreneur, I put that aside, so I couldn’t be an employee. Right. So I think that the fire didn’t happen until later. You know, until that until more recently, when I decided that, you know, after getting fired from yet another job, I was like, you know, I’m not doing this anymore. That that really, really kicked off. me doing this thing wholeheartedly. 100% all in, you know. So I think that that early on. I don’t think it was ready. You know, it was one of those things that that I’m sure you might have heard. I think it’s an old proverb. It says something like when the student is ready to teach yourself shall appear. I think at that point, I wasn’t ready to be taught, you know, I wasn’t ready. I was still in the mindset of an employee. I wasn’t doing self improvement. I wasn’t reading books away. I’m reading books today I was doing a these things that any successful entrepreneur should be doing, you know, to really be successful. I wasn’t doing that, you know, to my own detriment. I needed to be doing that stuff. I do it today. But, you know, it’s why this is I just wasn’t doing before you know.

14:21
So let’s kind of talk about this, this topic of you know, where do you go LP or GP, you know, you’ve got a few rental properties, you’ve got some experience under your belt, but, you know, you start to realize it after having five 810 single family homes, just not scalable. It’s not going to get a substantial passive cash flow coming in every month. You’ve you’re, you’re obviously a success story, but I’m sure like myself, you’ve seen a whole bunch of guys fail at this. Oh, yeah. Any comments on like, the percentage of people that try to take the next step and what is it if you can talk about like, you know, people trying to make this decision on Their own in their head right as they work their hundred 200 k job on the side too, right? Yeah,

15:07
yeah. I tell you what lane I mean

15:12
to, for many, many people, there’s guys out there on the internet. They’re putting up these courses Hey $4,000 I’ll teach you everything you need to know. Do it Sign up now. Man, I tell you, I mean, hey, listen, we have a program, happy to sell it. However, what you don’t see is the amount of work that goes into finding and putting together a deal. That’s an obscene amount of work. And we might go through a lease 100 deals before you find one. Right one that actually pencils out, and has shows a glimmer of hope that it could be something that you could invest in and get a nice return to hit the targets that we establish right Not including all the relationships you have to build with the brokers. So that’s that in itself is a full time job calling on brokers Hey, buddy How you doing? Got any deals for me? Hey buddy hi to continuously making phone calls talking to brokers. That’s how we that’s how we find our deals. Anyway, we’ve got our deals primarily through broker broker relationships, right? Then of course, vendor relationships, right and maintain those relationships, maintaining relationships with our lenders, as well. And the lender brokers who I mean, I’ve already talked to, to my lender broker four times this morning on a variety of different deals refinancing three deals right now, you know, so it’s like all that. Everything I just mentioned is a full time job. So as an executive, as a C level executive or hell any executive for that matter, even even if I’m working at a company as a developer, I don’t know how I would do that. And also try to do what I’m doing today. It’s it’d be extremely Ordinarily hard. That’s kind of the reason why we what I would do anyway, if I were in that predicament is just partner up with, with a good solid operator that knows what they’re doing. They have a great team. And they know how to underwrite deals, they know that the dealer put together then they know the reasons why it’s a great deal and go all in on that. I mean, in reality, they get equity in the deal. They get, they get a return, they get all the tax benefits. It’s not a bad gig, you know, sign a bad gig at all for an LP. You probably see a whole bunch of these guys just like I call it like the dreamers. Oh, you just I just want to highlight what you said there. Like, obviously, you have to work hard and everybody knows that and these guys will like, Yeah, but I’m, I’m special. You know, I work really hard. I’m like, Alright, do you do have a college degree like, I mean, not saying that. That’s important, but you know, that’s why I like working. One of my criteria is that you are a professional. Right and Not saying that college is worth anything I’m actually kind of against the whole traditional educational system but shows a level of commitment that, you know, most people come into this. What’s that? What’s that, um, that movie with the flying dog never ending story or something like that.

18:20
Like he goes to like the thing and it’s zapped somewhat the lasers. Like you’re not worthy, you’re not worthy. Yeah, a lot of people just are just gonna get zapped with the lasers. And yeah, I think what you said there like, you have to work your butt off but you also have to like have these special skills of like, navigating key relationships with brokers, lenders, etc. Partners,

18:43
man, that’s what

18:44
these hard workers cannot.

18:47
They can’t do it, man. I mean, listen, I don’t want to sound like you know, I get down on people that don’t have to work but I mean, yeah, I meet them. I meet him at different events and they say they want to become a syndicator and They don’t dress the part. They don’t act the part. They don’t say the right words. They can’t spell and lie. That it’s and I’m not saying that, that, you know, this is harsh I say it’s exclusive little club or anything else like that. It requires a great deal of effort. That’s all I’m saying. It’s like, it’s it’s very hard to convey over a podcast or or it’s just difficult to convey that way but it tight. I started you know,

19:34
I started on a real estate conferences because I find the other guys the guys who listen to like thousands of hours of podcasts, and they tell me things I don’t know about this weird calculation of some noi thing or I’m like, Alright, man, like, you know, the academics. Yeah, well, I know all about that I’ve seen you know, like, let me tell you, like, Oh, okay. Adios. Have you done you know and but then you ask your buddy and you’re like, yeah, that guy isn’t the jack you know? Yeah, that’s all I got and they just the part two right?

20:09
There was one so one of my students he actually went to a seminar and someone the headliner at the seminar actually said to a group of 200 people fake it until you make it like, Oh my god, no, man, listen. You know, guys like us, we have a fiduciary responsibility. Right? That’s that is key. We have a responsibility to our investors, we have a responsibility to our families. We have a responsibility to the people that invest with us as well personally, friends and family aside from aside from other investors to and to everyone else that is relying on that project’s success, right. There’s no time for fake it until you make it right when you when you’re when you’re messing with other people’s livelihoods. There is no faking. My opinion, that’s just what I think, you know, it’s like I would never ever say that and I would never recommend to someone fake it until you make it. It’s more like, study learn, understand how to put this deal together partner up with someone that knows what they’re talking about. Work with them get to know them. It’s a long long long journey this this was not something in my case. Anyway, that happened overnight. It took took me 16 years, right took me 16 years to become an overnight success. Right. That’s that’s how it is in this business in my opinion, anyway.

21:34
I mean, and then also, like, you can’t do this while you’re working a full time job now. Like maybe pick up your first small apartment building but you know, I yeah, it gonna work. It’s just not possible.

21:48
I mean, it might be possible to get like, say a 30 unit. You know, handed over a third party management and you’ll probably get the price steal from you is what they’ll do more than likely What I mean by that is that because you’re focused on your job like you should be, it’s gonna be very difficult to also watch all the expenses on on this third party and what they’re doing. Right? And how do you negotiate that contract to, by the way, right? If you’re doing 30 units, you’re starting off 30 minutes, that means you’re paying 10% we’re not paying anywhere near 10%. Right for our for the management of our assets. But what they’ll do is they’ll cut you a break. You know what, just for you, lane, I’ll do it for you for five and you’re like, Wow, cool, okay, but then they start, start fluffing it in with all this extra stuff. You know, oh, we took a trip, please. The door lock, painted a room that didn’t need to be painted. And they’ll find ways to get their money out of you. Right. And having those relationships like I said earlier, it’s like that’s another vendor relationship. You got to keep a close eye on what money gets spent. Right, what money gets spent on what assets and you notice, for instance, we do this all the time in our office, to assets side by side to different location. How much are we spending on a unit turn over here versus over here? Why is this one less than this one? What’s going on? Let’s have a call, let’s figure it out, right? Or is the two different vendors to me too, they take this vendor and put them over here, right as well, right? different things like that. It takes time to run those analysis and know how to really figure out how to do that kind of stuff. If you have 30 units. It’s very hard to find someone that’s going to care. And that’s that’s probably the biggest issue, you know, with some of the smaller deals anyway.

23:27
Yeah, I’ve kind of found that you really need to be above 80 or 100 units. I mean, everybody talks about it. So this is another one of those things, these podcasts like rupees book rupees. A know these rules like oh, you need to be over 56 units to get a property manager in the office. But in real life, you need that person and the handyman. Yeah,

23:48
yeah, yeah, for sure. For sure. I need an even 56 units, depending on where it is, uh, I don’t know if that’s feasible. Honestly. It’s more like 100% Canyon is probably the minimum but yeah, man, I mean, and now nothing wrong with say starting off with 30 units and two months later buying another 56 units and two months later, if you want to do it that way, I suppose you could do it that way as well some really really wants to do this on their own. But man, I can’t I can’t even imagine working on an office job and trying to run that number of units, three different properties by yourself, like keeping it as an asset manager as hard man, that’s hard work. It’s hard work for what like what is the overall goal you know if the goal is to get that passive income. difficult to do, man that’s that’s that’s tough work. That’s tough work.

24:38
If you’ve been following my journey, I’ve been selling my initial real property and transitioning into syndication deals lately for more purely passive investment strategy. One critical part of my portfolio is the American Home preservation fund, or what folks in the hooey call HP for short. George Newberry once apartment owner, operator and mentor to me is that Now sponsoring the podcast is private fun, which by the way also accepts non accredited investors cuts the middlemen out and allows you to invest directly with him to fight the mortgage crisis in America. join him by purchasing distressed mortgages while getting a double digit annual return paid monthly. Find something else better out there. Well let me know. Feel good knowing that you are helping families stay in their home after buying their underwater note at a huge discount, invest as low as $100 by going to HP servicing comm slash investors. And if you want the free bernsen book, please send me an email plain and simple passive cash flow calm.

25:42
Well, that’s a light bill.

25:49
So we’re in this COVID-19

25:53
crisis. We’re just another day at the office for folks like you and me but right but I know you’re you can’t go as much water like a two week experiment that you’re kind of tinkering on, or a six and a six month project you’re working on, you know,

26:09
I don’t have a six month one but I do have a year one so back in December, I create a list a book list, right of all the books I’m going to read for 2020 I create a list on a sheet and then I have a checkbox check check off every single one every so book a week, basically, right I got I got a hold of all the books, put them all on my phone. Right now I’m reading The Autobiography of Albert Einstein. And yes, very interesting guy. But the books are mainly consist of autobiographies. For people that overcame some really hard times. You’d be amazed at the hard times that Albert Einstein had as a young scientist, but what it took to overcome something would listen to a lot of eyeless a lot of stuff on sales and marketing as well social media marketing and also on on sales, you know, so it’s those things that pretty much make up the book list, right? And much of my, my real estate stuff is all made up of I do listen to some real estate, but most of it is just by networking, masterminds, things like that. That’s how I that’s how I engage that through real life problems and resolving them. So, yeah, that’s definitely a lot of fun. But yeah, I mean, try reading a book a week, that’ll change your life. I promise you, I’ll change anybody’s life.

27:28
It’s good stuff. It’s awesome. Any kind of like, personal, like, two week project, something, uh, you know, thinking in the daily routine or something like that,

27:38
you know, uh, trying to work out at home. So, so far, since all this stuff happened. I can’t go to the gym anymore. I can’t go to CrossFit. Right, which is what I was, which is what I usually do. So now I’m having this so far. This is what week two, this was discovered it thing. Now. It’s all about working out at home and Tire man it’s it’s tougher to do at home than it is to work out at the gym with a group of other motivated individuals. It’s it’s tough but I will make it I’ll get I’ll get through it.

28:12
I do CrossFit too and then like yesterday I got bumper bumper plates at home I got my patio but I was just I just put in like 135 which is like nothing and I just dead lifted it like 10 times I was like that was boring

28:27
it’s easier to do when other people are around right? Yes, the thing you know, it’s I don’t know. I don’t know what it is. It’s kind of like there’s other people there and there’s just more energy in the room. I think that’s what it is.

28:38
Yeah, total accountability. thing like getting the the mirror or the bike thing the peloton or at clon I don’t know what it’s called.

28:48
Yeah, the peloton. peloton Yeah,

28:49
but they told me that the bike there’s so many orders for the bike that it’s not gonna be here till like May or June,

28:56
right by then this thing will should be over.

28:59
Yeah. Yeah,

29:01
I mean it’s got to get over soon sooner than later I would imagine

29:05
yeah for sure. We’re just lucky it’s about the Spanish Flu then all the crossfitters would be dead you know the Spanish Flu when after like there was a stronger immune system the more like it attacks yourself. Something like that.

29:20
Oh, really? I have no idea. All

29:22
right, all like the young guys here like super fit. They all died.

29:28
Wow. All right, man.

29:33
Um,

29:36
what is your simple passive cash flow number that you’re shooting for these days? What What is that for you? on a per month,

29:46
you know, per month, you know what it’s like what we did, my wife and I, we, we basically cut our expenses. early on. Anyway, we cut all of our expenses so we can just focus on building the business. Part of it is the sacrifice and got to keep in mind, you know, I’m the guy that had the corporate america job making bank at the huge house with granite countertops and cathedral ceilings. I had three cars at a Corvette at a Hummer Mustang convertibles and all this stuff, right? Got rid of it all to focus on building the business. Right? So back then, it was it was only like 10 grand a month, you know, it cut out everything. Everything was cut out. Right? So it really wasn’t that much. And, you know, and any money that we get is all thrown back into the business over and above that number. You know, that’s that’s basically how we did it. You know, it’s it’s, um, yeah, that’s that’s pretty much it. You know, it’s, it’s not a big number when you think about it, because by the time you think about it, you know, the government’s gonna steal half of it, right, you know, taxes. And then then you have to live off the rest, you know, cover your expenses, so Not much not much at all.

31:04
Yeah, and a lot of it is like equity that you kind of roll into the next one and the next Yeah, that’s right. Well I mean what’s your What is your your wife say when you kind of say hey it’s it’s gonna work just give me four to six years the magic will happen you know you’ll see it or you start your life will start to change you know that is that kind of which a deep discussion or

31:28
not you know i i am i’m very very very lucky that my wife I met her before before really I got into all this stuff like as a full time gig the way I’m doing it now. So she, she knows me She knows the story. She knows my personality. And she often tells me she goes I have no doubt I have 100% certainty that you are going to do exactly what you say you’re going to do. She has no zero doubt She believes in Me 100% she’s on board, you know. So I am extraordinarily lucky that my wife is on board. She believes in me, she believes in what we’re doing. She’s she sees it already. I mean, isn’t like this is all like, pipe dream stuff. You know, I tell her. I’m closing this deal on this day, boom, it happens. She’s like, she’s not surprised anymore. She couldn’t be surprised a long time ago. Right. But, yeah, it’s having a spouse, especially in this business. And that will support you is extraordinarily hard. You know, it’s because yeah, I mean, I’ve, my, my friends that are in this business that are like top performers. I mean, that’s one common trait is that their their spouse at home supports them. 100% and I’m happy to say that my spouse is in the same boat now. It’s awesome. It really is. It’s great.

32:54
It’s great. I have the reluctant spouse guide on my website, guys. Simply Passive cash flow calm slash spouse. It’s not a joke. It’s for real.

33:04
No, I know I know it’s real no I got

33:06
it. I got it. What do you guys do when you close a big deal but anything specials or some kind of

33:13
sushi man, sushi? That’s just

33:19
like a little celebratory thing. When my when my other partner comes into town, it’s usually vegan food, you know, he’s a vegan. I’m vegetarian, so it works out great. You know and it’s that’s a little celebratory thing you know that’s by with the wife anyway. Yeah, we I think we always celebrate something we celebrate in a very small way. It’s it’s sushi, some very small we don’t. For right now for the time being. We are very, very careful with how we spend money necessarily invest, we do invest our money, but how we spend our money on things like that. We’re very very careful. how we how we do things, you know, we’re not reckless or careless or anything else like that, you know, it’s very important that we spend money where it needs to be spent properly. For us anyway, it’s how we do it. Yeah, that’s how to do it

34:13
that said, What is something you recently bought? or thinking about burning your cash on over time savings or improvement of quality of life?

34:22
Well, you know what, doing this stuff is a real big deal for us. You know, it’s like we have the bulletproof cash flow podcasts that we do right. And I upgraded the camera got a new camera coming in. That was like 200 200 bucks. The Logitech one, but if anything is gonna help get our word out there. No, no, no, no, it’s actually it’s a used camera man. Okay, so use when it’s easy to use canon t three i. So, yeah, we’re going to hook that up and we have a whole bunch of new equipment coming in just to really improve the audio and video Right But like I said, Yes, we’re just very very careful with how we invest not only do we invest our money outside properly other people’s money we invest our own money very carefully as well.

35:13
It’s funny because yeah, those those Logitech guys, they barely send out emails, but they sent out this like, new 4k camera.

35:20
Yeah, the Bri. Oh,

35:21
yeah, yeah. The fria I bought it. Well, not the real the real for the windows one, but this one’s for the Mac. It’s like,

35:28
okay, okay. Okay, so that one is, I don’t want to geek out in front of front of your audience. But yeah, the debris out of the bruise is supposed to be a really good camera.

35:40
Yeah, so people can see like, the crusties I have in my eye for waking up super early. That’s not the best thing.

35:49
That’s right. That’s right. You want to zoom in and check it out. There we go.

35:52
Yeah, not too. Not too close. But yeah, if you’re on the YouTube channel, you can check that out. Yeah, there you go. Something that you recently changed your mind on because often ego gets in the way of greatness. And I see a lot of people, they just have some messed up thoughts and I’m like, All right. Okay. Sounds good, dude, you know? Yeah,

36:12
yeah, yeah, yeah. Yeah, you know, um, I wouldn’t say it’s recent. But I’ll say that it’s, it’s so much changed my life when I realized that. So back when I was an executive at, you know, working as CIO, I thought that all it took was for me to do a good job and keep technology up and running. And if I do that, I’ll get paid and everybody will be happy. systems are up. I’m innovating. Everybody’s getting paid. What can go wrong, right. And then they hand me the box right at the end of it all. The that was wrong. That’s incorrect. Totally wrong. The way that it’s supposed to be. Then one thing I did not do It did not network with the people that worked at the company. I pretty much kept to myself I focused on I got there early, work my ass off, sit there too late, you know, I was putting in 1213 hours a day at this company. Right? And, you know, it’s working hard for them. That’s why it’s supposed to do right. And I still got handed the the box now. And meanwhile, there’s guys, they’re still working at the company that were known to be somewhat of questionable character. They’re still working there. Why they took the time to network with the other executives. And they and they went to all the meetings, they went to all of the the conferences and things like that to getting to get really engaged with the community with the community of the business and also the community outside of the businesses. That really connects other people in that in that space. I think Mac cases, finance, right? So other people in the finance in the finance world knew of the company and knew of that individual made them worth more money. Right? It’s kind of like the same thing that we do ln, you know, it’s the same thing. I mean, we got to do the same thing we’re getting out there, we’re building our personal brands, we’re getting out there, we’re building our businesses, it’s the same sort of thing, you can’t come out of nowhere and expect to buy a 200 unit property if nobody knows who you are and what you’re about, you know, it takes time to build that, you know, takes time. So that’s, but anyway, I was totally wrong about that, you know, now, this business is all about partnerships. This business is all about delivering value to other people, in a way that you’re giving someone, everything you can, you’re giving your partner’s everything you can know everything, you know, and and that’s, that’s how I operate anyway, if I do everything I can from my partners to try to make things easy for them knowing that in one way, shape or form, it’s all about Come back. That’s how I do business. So,

39:02
yeah, it’s um, I mean, you can see it in your investors, right? Like, I know, like a lot of my guys are engineers. So it’s the typical person is, if they’re under a million dollars net worth, they’ve kind of saved their way up to that like 700 to 800,000. And there are total like, like developer type or person or compute in their cubicle. Not really expanding outwards, were the guys who are a million and a half $2 million net worth and above. Obviously, they’re already investing. But they’re the ones that got out of the engineering role and more into the sales engineering role. Right?

39:42
That’s right. That’s right. Well, hey, listen, you can never ever, ever save your way to prosperity. It has never worked. It never will work. The only way you can. You can be wealthy is to invest. That’s the only way the only way to make it happen.

39:58
It just it just kind of Interesting that it’s kind of coupled where the guy who has that mindset where I’m just gonna keep pounding away at what I’m doing not talking to anybody is also the guy not investing their stuff outside of Wall Street type of instance. Right?

40:13
That’s right. That’s 100% true. Yeah, yeah, yeah. Okay, I’m doing I supposed to be doing Right, right. I’m doing I’m supposed to be doing I’m working away.

40:21
Okay. And everything.

40:23
Oh, yeah. Oh man, I was doing all that stuff. I was putting all my money in this 401k thing. I was doing everything that I was told to do. Everything else I went to school. I got two masters degrees. I was a good CIO. I went to corporate america and then they hand me the box. I’m like, Wait a second. I did everything I was supposed to do last night. No, I was not

40:47
that’s why I was saying man I’ll never go to that place ever again man. So happen

40:52
yeah away and select lies with doctors, right? Like, I don’t. Most doctors who aren’t investing their net worth really never get above one to $2 million. Right? But the guys who are holy crap, they’re like four and a half $10 million

41:09
a day. But my one partner, she’s, she’s a young doctor, and she’s a partner on one of my deals. And she’s been able to blow up her net worth tremendously, not just on that deal. But she has the mindset that you just said, you know, she’s she’s investing in other deals as well. Right to help grow her net worth. She’s gonna be very, very successful. She’s in her early 30s. She’s making great money already as a doctor, and she’s blowing up her net worth even more. So yeah, she’s doing great, but the same thing. You know, she’s she’s focused on putting money aside, you know?

41:44
So this is a seller’s market and, you know, kind of in the middle of a crisis, and I’m sure it will go away here in the next few months or whatnot. What should people be focusing on investing in?

41:56
Oh, wow, the stock market is where it’s at, man. I thought

42:01
you’re kind of serious because people will say that

42:04
I’m like, Alright, man. It’s ridiculous, man. I don’t I don’t get it. And I used to do that, you know, as a young kid when I was when I didn’t know any better about real estate or anything else like that I was, I would sit up, sit in my office. And you know, when the boss isn’t looking try to do some day trading and all this other nonsense, man. It’s ridiculous. It’s crazy. I mean, think of it like this, right? So I had a friend of mine, he was gonna throw like $200,000 in some stock or something. And I’m like, once you throw down a deal, man, throw down on a deal. It’s like, Oh, I don’t understand the real estate, business. yada, yada yada. So I’ll put it this way. All right. It is at that time was May the first right. I said may 1, great. What’s your stock? What’s your stock gonna be worth on May 30. He’s like, well, I don’t know. I said I could tell you how much money is gonna come in on May 30. From my rentals, I know, because I have legal contracts, called leases, with all my tenants that say they’re going to pay me. Every month that money comes in, right? It’s predictable. You’re building up equity in a cash flowing asset, you could force appreciation on this asset, you get all that you get, then you also get depreciation on the asset to mean that you can’t do that with a stock. You just can’t do that. I mean, if you were told my buddy, this tells, like you go to Bank of America right now see if they’ll give you a loan to go buy their stock, no one even do that, because they don’t believe in their own company enough. It’s crazy, you know, it’s crazy, but it to me, it’s like, it’s like gambling. It’s like gambling at a casino, you know, because you don’t know for sure. What’s going to happen tomorrow. Right? Whereas with real estate, even during this crisis right now, I mean, we’re still buying. I mean, I’ll look I’m looking at assets now. You know, and the thing is, though, is that At the end of this crisis, it’s not gonna matter, the assets still gonna be there, it’s still gonna throw off cash flow, and we know what it’s going to do because it’s very predictable people no matter what you do, in masses, Maslow’s hierarchy of needs. Everyone needs a place to live, no matter what they don’t need an office, they don’t need a piece of paper, this is stock on it, what they do need is a home. Right? And that’s what we do we give people homes and this is that’s why it’s like, especially this kind of stuff that we’re doing. It’s a it makes total sense to do and we’re not worried about it. You know, it’s they should be investing if people need to be investing in real estate, they should have been investing real estate all

44:40
obviously, you kind of know you can put it on a model and you can kind of tell from deal to deal but for somebody sitting at home who doesn’t have a network, nor has any kind of underwriting experience, what anything that they should kind of stay away from in the world of real estate at this time. Oh, yeah.

44:58
I mean, it’s you know, y, d cos assets, those are the probably the ones that are pushed the most all over all over the place. I mean, especially, that’s not to bash on loop net. But loop net, unfortunately has has a lot of this bad inventory. And what I mean by that is there’s the promise of the super high cap rate, you know, I’ll give you a 15% cap rate, oh my god, the cap rate, the cap rate, the cap rate doesn’t really matter all that much. It’s not the cap rate. It’s the margin you’re looking for, right? The cost of money versus the cost of running the asset, you know, what’s the difference? That’s what you’re looking for. cap rate is important missing. It’s not important, right? What I am saying is that people are getting out there pushing this these super high cap rates and when that person goes and buys a deal, which is usually in a D class area, they get burned, and other stuff with it with a non performing asset. Because everybody was just heads on beds, they just previous owner who approved the seller, rather just put a whole bunch of people in there, drive the occupancy up, unload the property and got rid of them all happens a lot, especially in D class assets. You know, it’s very seedy type of business. Stay away from those places, you know, just don’t do those. Just especially if you’re out of state. Don’t do that. You know, I personally stay away from it. Some people specialize in that stuff, all the power to you go ahead and do that. For anyone that’s in this business and even as a limited partner, stay away from D class assets, invest with a good operator that knows they’re doing with C’s and B’s and A’s that knows how to run a proper asset. Make sure that performs that’s the best way to build great wealth and still enjoy all the benefits that come with managing and running and multifamily asset. I mean, for a passive investor in that way it works out super, you know, they get all they get the benefits without taking on any of the risk, really, it’s very low risk. Very low risk for an LP.

47:02
Yeah, we’re kind of looking at getting away from the class C stuff, which is probably what you’re talking about, you know, like, you’re saying your class D. But for me, it might be a Class C or definitely what a what a broker would call that Class D, or Class C, because they’re always trying to make it sound better than it really is. But yeah, just not worth it. I mean, those are the guys who get hammered the most and this in any kind of weakness, I mean, they get fired for so that they don’t have any savings to

47:30
That’s right. They live hand to mouth, they typically have salaries that are hovering, usually at $30,000 probably even less than that. You know, absolute poverty, you stay away from those places, you know, it’s just not worth the hassle. never buy cheap real estate. There’s a reason why it’s it’s, it’s cheap. No, it’s not. It’s nothing that you really want to be investing in. You just don’t want to be investing and stuff like that. You know, it’s it’s not worth the hassle. Not worth the risk. It just isn’t, just isn’t worth it.

48:03
And to wrap things up our last closeout question is the Tony Robbins question of the art of fulfillment and the science of achievement. So first what is your secret or hack to the science of achievement? Any kind of rituals or things that you found lately that has helped you be more productive?

48:24
Yeah, I mean, I’ll tell you, I’m getting up early in the morning. Going through CrossFit first thing, you know, early, like, you know, you’re waking up at like five o’clock in the morning, to go to CrossFit for six months when we come home. The world is still pretty much asleep at that point, or at least I’m not on the phone anyway. I sit down, I write out my my journal. And then I write out my goals. Right, right. Just one page of the journal one page of the goals like what, what happened yesterday, go and how’s my tomorrow going to be? Right? And when I say tomorrow I don’t mean just like daily goals I’m saying like, what is my life going to look like and I write these goals as it’s already happened. Right and that’s important because I’m programming my subconscious to look for those things to build success you know and I often do that too if you know if today doesn’t go my way I’m writing on my journal and writing in my my goal sheets, preparing a new one just to keep me on on target. But you know, that’s that in itself. That function going working out my body and then working out my mind and then I’m ready for the day that has made all the difference in the world that has changed my life. That those those two things you know, it’s it’s I’m sure you hear about it everyone talks about it on their on these podcasts, maybe or read about it in books and you might think it’s all Fufu nonsense. I promise you that stuff. It works hundred percent. It’s amazing. It’s a life changer. Absolute life changer.

49:59
And what is A secret or hack to the art of fulfillment, any way you contribute back, or how do you kind of keep things in perspective?

50:07
Wow, you know

50:11
that so one of the things that I wanted to do in my journal was that I write about is Oh, I do want to help the children of Cleveland, right? So in December, and I actually wrote it down in my in my, in my goal sheet what I plan on doing charity wise too much. It’s funny, you brought up Tony Robbins, he started his charity, thanksgiving charity, right? I want to do the same sort of thing. So what I’m doing is and I write it down in my goal sheet, I write it down. I want to help these kids. I want to help this kid. So part of what I’m doing is of course, for building wealth for myself building wealth for my family, my investors, I’m setting aside resources so I can do just that. You know, I’m not gonna play something. I can do it yet, but it’s going to happen hopefully this year, right? And with that in mind, that’s how it gives me something to work work for, you know, it gives you something to look forward to as well, because I do get joy just by helping some other people and I’m not expecting anything back. You know, that’s how I do things. I just don’t expect anything back. I just want to give as much as I can. And you know, and hopefully help out these these people make a difference to someone’s someone’s world. You know, that’s, that in itself means a lot. So that’s, that’s how I do it. That’s how I do it.

51:28
Awesome. Yeah, so we’re something I’m trying to do on my site is to get more involved in donors choose if you heard of that website, you can kind of donate to teachers who have like elementary or high school projects. And I have I’m getting going to get ready to launch that to my group, but I want control over what projects we give to Mars financial education type, as opposed to like interpretive dance or building a canoe, kind of a project.

52:00
I have control you know,

52:01
man, I tell ya know, I love it because I know it’s exactly what I wanted. What I want to do with with these kids and you know here in Cleveland is that it’s probably the same journey that you’ve been on, same one that I’ve been on, you know what lane, you you go to school, you, you get a job and that’s it, you go put your money in a 401k you get old and you die and that’s how you’re going to be and then you’re expected to be happy that way. That is not a way to live a life to your full potential. You know, in my opinion, I mean, that’s not my full my full potential anyway. And throughout all of that, the one thing that we’re not taught in school in grade school, high school, college is wealth, wealth building, we’re not taught that, you know, we’re not taught at least I wasn’t, you know, to learn that on my own. I’ve learned afterwards with mentors. You know, and that’s, that’s huge. No, I love that idea, man. It’s a great idea, you know, built tied into some sort of some sort of mentorship program maybe or some way to some way to really introduce finance and Financial Intelligence to some of these kids just be awesome nuts. It’s remarkable interpretive dance. It’s not gonna get you a job. Just Whoa. Well, the ricotta job, Johnny Why?

53:15
Yeah. Making pot, right? Yeah, Fox Fox.

53:22
But yeah, you want to get your contact information. People want to get ahold of you. And we’ll put this all in the show notes. If you guys go to simple passive, casual calm.

53:29
Absolutely. Absolutely. Now if they if they message me at info at bulletproof cash flow, you can find me on Facebook. I’m on I’m on LinkedIn, find me on LinkedIn, too. And of course on Facebook as well. Follow me on Instagram. We’re all over the place very just just google bulletproof cash flow. You’ll find me you’ll find me.

53:48
Alright, man. Well, I guess I’ll probably see you shooting emails out to me and spin around the dropbox when I’m still up at night and you’re getting going in the day

53:57
out. You’re doing awesome. All right, that’s gonna be fun. Thanks. All right thanks so much.

54:07
This website offers very general information concerning real estate for investment purposes every investor situation is unique always seek the services of licensed third party appraisers inspectors to verify the valuing condition of any property you intend to purchase. Use the services of professional title and escrow companies and licensed tax investment and or legal advisor before relying on any information contained here and information is not guarantee as an every investment there is risk. The content found here is just my opinion and things change and I reserve the right to change my mind. Above all else, do your own analysis and think for yourself because in the end, you’re the only person who is going to look out for your best interests.

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