I Tried Impact Investing for a Year and Here's What Happened

What's up, everyone? Welcome back to the Art of Winning. All right, today we got a good friend of mine and somebody that's absolutely killing it right now in real estate. He's got a really cool strategy that I had never heard of until he brought it up, and now he's actually helping other people get started in this. So I think you guys really like this. His name is Andrew Lamb. Andrew, thank you so much for joining us today. I think this can be fun.

Yeah, thanks so much for having me, Ashton. And excited to chat.

Yeah, man. And before we get into what you're doing, can you guys give it. Can you give all the listeners a quick snapshot of who you are, you know, where you're from and what got you to where you are today?

Yeah. I am in Vacaville, California, Northern California, about 25 minutes from Napa. Pretty good spot. A couple hours from Tahoe, right in between Sacramento and San Francisco. So grew up here. My parents are both Air Force, so they met at Travis Air Force Base In Fairfield, about 10 minutes away from where I am. And, yeah, just got into real estate after college. Went pretty close. 20 minutes away to UC Davis. Studied linguistics, but graduated in 09 when there were no jobs. So ended up working one year at a small private school because I had a degree, little Christian school. And then the next year, got married, found out six months in, we were pregnant and really needed to do something different and make more than 28,000 a year. And so got into real estate. So that's what I've been doing here locally for, I mean, last 12 years or so, since 2011, and own a brokerage, a Keller Williams office, and got into, like, flipping and investing back in really, like 2020 pretty heavily. And that's what I was doing before I figured out kind of this. This new thing that I've been doing for about two and a half, three years now called sober living.

That's awesome, man. That's awesome. How was it getting into? First you were a real estate agent. I mean, you're still a real estate.

Yeah, yeah.

Did you say you started that in 2009?

No. So 2009, I graduated 2010, got married. So literally 2009, bottom of the economy in the U.S. yeah. I could not find a job. I filled out, like, 60 applications. I got one interview, and it was in Tiburon, California, which is, like deep Bay Area, beautiful area. But it was. It was two things. Number one, it's super far and traffic was terrible. So I did not necessarily want that for my life. I knew it would be torture commuting, even though it was a good job. And two, it wasn't necessarily like it was something I could be good at. It was a, like a data analytics type of role in a company. And although that was my personality style at the time, oddly enough, because I was a computer science major initially, then linguistics, which is completely changed, which we could talk about that too. My personality is completely different today, but it just, it wasn't in alignment with who I thought I wanted to be. And I had that a couple of times in college where I changed my major because I was like, I don't really want to work in a basement in some server room. Because that's what it was at the time. Computer science completely changed. Now I'm like, I could have worked for Facebook for 400,000 a year, but. But it's just, I knew the future me would be upset with the, the current me if I made that decision. And so I kind of always knew business was a path for me and probably real estate. I would read Rich Dad, Poor Dad. My parents did Amway growing up, so they always had these books and they were always looking for something entrepreneurial like side Hustles, Carlton Sheets and all that stuff of like no money, down investing. Like I read all this stuff. I went through the books as like a 12 year old, 13 year old and I just thought, man, this sounds really cool. Didn't connect the dots until about 2020, but it was always in me, but.

And yet you still gotta linguistics.

Yeah, well, I just love talking to people. I took five years of Spanish, kind of middle school and high school, ended up learning French, going to France and going to Europe a few times in my late teens, early 20s, and just knew whatever I did in the future, communication was important to me. Being able to talk to different people, being able to understand. And I just love words. So it was a good way for me to travel, to study what I loved and something that I thought would be useful in the future even if I didn't get a specific job in linguistics.

Yeah, that's really cool. And something you said there, I really like. Your future self would not forgive you for the decisions, you know, your past self made. I like that because I think a lot of us live, we base our decisions on our past, our present decisions on our past, not on where we want to end up. And that's how we end up. Like writing all.

Yeah, it's interesting. I've. I mean, I didn't have the best of upbringings, I guess you Kind of find that to be a normal thing among people who are highly successful. But, you know, my. I grew up with a single mom, so just immediately didn't feel like I was wanted. My dad and mom didn't get married, even though they met, had me before I was born. Like, they had broken up. And then I had a stepdad who was not the nicest guy and kind of a small man complex. I was bigger than him by the time I was 11 or 12. And he wasn't physically abusive with me, but he was very verbally abusive. And I just remember growing up thinking, like, I have really good examples of what not to be, and I'm in control of who I actually want to be. And I was always thinking about, like, well, in the future. And maybe there was a lot of escapism. I was, like, just trying to get away from home. But I. I was always thinking about who the future me would be and how I would be as a dad, how I would be just in general with my wife. And I wanted to be present. My dad was a pilot, so I would visit him occasionally, but he was working all the time. Worked 30 years for American Airlines, and after the air force, after seven years flying 141s. And I just. I was really clear on who I wanted to be when I was older. Very future focused.

Yeah, I think that's powerful. I mean, I've heard it before. It's like when you have these things happen to you, it does. It gives you a really good sense of clarity of what you really want out of life and. And it goes without saying, or maybe it goes with saying, maybe it should be said, but it allows you to be appreciative of it too, you know?

Yeah.

I think, you know, you go through that situation and, like, now, you know, like, man, that propelled me to do this and this and this and then get clear on my goals and. Because people that have it really easy, man, sometimes they're just as miserable, but they don't know where to go.

That's true. And I could have spent a lot of time blaming, and I probably did a little bit, but I also worked really hard in my early 20s. Part of that was just going to a leadership program and, like, going. Going through some. Some classes and stuff. That really helped me, like, offload a lot of the. A lot of the stuff I was feeling. But also, you know, and I'm a Christian, so I, I. Even though I didn't feel like I had a father that wanted me, like, I have a heavenly father that Knew me before I was born. So there's a big shift in identity there. When I really tapped into that when I was probably I was like 2007. So I was 21 when I really, like dug into that. My mom was a pastor and. But it was always like she was dragging me to church growing up. It was never really my decision until about 2021 after I traveled the world and realized what I was looking for was like, right here. I didn't need to find it out there. It was like inside.

Yeah, yeah, that's powerful, man. All right, so walk us through. So you, you got into real estate, you became a real estate agent. How did you end up with your own brokerage and then doing flips and walk us through the progression in that.

Yeah, so 2011 I get into real estate. Wasn't easy. Everything was pretty terrible. Short sales, foreclosures, long processes. Still sold a home my first 30 days and sold, I don't know, four or five. The next year or so, 2012 hit all the banks were getting in lawsuits for illegally foreclosing on people. They called it kind of like the robo signature. They were just stamping paperwork and knocking stuff out instead of actually reviewing and checking numbers, all that stuff. And so it was really tough 2012 when all the foreclosures were taken off the market. The few short sales that were up weren't really moving. Like a short sale is anything but short. Took 912 months sometimes. And so I had to get a second job and ended up doing like content management and social media management for our conference and visitors bureau locally, kind of for our city to get tourism and stuff. So really just kind of tried to figure out how to make it work. So it wasn't easy. But while working that job, I got a referral and I sold somebody. I remember this because it's impossible to find out, but I sold somebody like $156,000 home in a senior area and made more with that one check. Then I would have in two or three months in my job and realized, what the heck am I doing? I need to like control my own destiny. I also happened to read the four hour work week at that time. And I like four hour work week my way out of that job and automated some processes, got myself to like just 20 hours a week in the office and did real estate outside of that and built my business. And by the following year I had sold, I think it was 24 homes and was like one of the top agents in my office and like eight, seven or Eight of those closed in one month. And the next month I quit my job.

That's great.

I made more in that month than I would have made in two years in that job. So I was like, okay, it's real estate for me. And then from there, I ended up getting on stages, talking kind of in front of hundreds of real estate agents on how I was able to do that. And, yeah, 2016, I realized I wanted to build a team. No, a little bit sooner than that. 2014, 2015, because I couldn't sell any more homes. I mean, I was selling six, seven homes a month at that point. And had a wife and small children, but was out all the time showing homes all weekend, all weekend, gone, evenings, gone, listing houses, showing buyers, and realized I needed help. So I was trying to find buyer's agents to work on my team admin support. And the office I was at just didn't have it. They didn't have the training on it. They didn't help me at all. And the people that I found out didn't know what they were doing and would just help me. And I could call them up and be like, hey, I see that you're doing this thing. Can you help me with it? They're like, yeah, what's your email? They would literally send me everything they had for free.

Yeah.

And those were Keller Williams agents. And so I was like, I need a Keller Williams office. And there wasn't one in my area. So I start calling around, asking, like, for the regional director and saying, I want to bring this to my area. How do I do it? Didn't get a call back, but by just being a top agent and talking to people about it, ended up connecting with the title company, a regional manager who was like, I've heard of someone else wanting to do this. He got us together and literally it was like match made in heaven. I remember meeting one guy from Seattle. He came down, we met for coffee, and it was like, 15 minutes, yeah, we're going to be partners. This is what we're doing. That's all it took. And I went through that process. You can't just buy a Keller Williams franchise like you can any other century. 21 reMax, you just pay 25 grand. They give you the paperwork. Good luck. With Keller Williams, it's a lot like a Chick Fil A. You get awarded a franchise. There's a lot of work you have to do ahead of time to prove that you're going to be successful, that you can recruit all this stuff. So we laid that groundwork and then, yeah, 2016, we launched our office here.

That's awesome, man. I like that. I like that. I think a lot of people, you know, they have an idea of what they want to do, they know what they want to do, but they don't actually start asking around. And you did that. And that's why it happens, right? You start looking for the who's instead of that. You know, how can I do this on my own? And that's how, that's how that stuff happens. All right, so how did you get into flipping then? I mean, I hear, I mean, a lot of real estate agents don't flip, right?

True. It's the saddest thing. And Gary Keller talks about this a lot. He's been a huge influence on me. But a lot of real estate agents go through life just collecting this tiny percentage, right? Two and a half, 3% for helping other people transfer real estate. Instead of even though it's in front of us every single day, opportunities in front of us all the time, we choose, just, hey, let me just get that commission instead of thinking bigger picture, let me get some of the profit, let me buy this myself. So I just changed my perspective from every opportunity is a 3% commission to now every opportunity is I could buy this, I could own the real estate. And so I had somebody who was like 90 years old, two story home hoarder. I had helped his son in law and daughter buy a home, they referred me to that. And they just couldn't get anything done. Every time they'd go to throw something away because the wife had died, he didn't want to throw it away, he would go right behind him and be like, nope, I'm keeping that. Nope, I'm keeping that. And they're still like late 50s, early 60s, still working. They only have weekends to try to clear out this house and it's just not going anywhere. And so I'm like, do you guys think you can even get it ready to sell? Like, he needed to get out of that house, it was too big for him. Couldn't handle the stairs. All the bedrooms were upstairs. They're like, no, we don't think we can. So it's like, okay, here's the options. We could bring in an investor and they'll take care of everything. You just take what you want, use the cash, help them buy a property close to you guys. And then, you know, whatever the investor is going to do with the house, he'll do. And so I brought it to somebody as a buyer who ended up Being a great partner and a coach of mine moving forward. And yeah, he bought it. I didn't take any commission on the front end just to make the deal work, but I got to split the profits on the back end instead of just listing it nice. And so that was my first foray into like I have all the leverage, I'm bringing the deal. All I need to do is say, hey, I want 50% of the profit on the back end instead of taking a commission up front. And it was far bigger than what my commission would have been. And that just made me think, you know why? I've been burned before by investors and they, you don't want. A lot of investors are newbies. They go to a Fortune Builders, you know, seminar and spend 25 grand and get a little buy box and think they're investors. And I would work so hard to bring them deals and then they wouldn't close on it. They'd get scared, they'd get cold feet. They couldn't line up financing, whatever. And so I just was like, man, I'm just going to buy these from now on. I know it's a good deal. I just need to find the financing and figure that out. So after watching this guy run the whole project on our, on the flip and then I listed on the back end, I get commission there, but also I get a percentage of profit on. We split it 50, 50. I'm like, that was the fastest, probably 25 grand I've ever made. I didn't do anything. And then come to find out that investor also didn't do anything. His contractor did everything his contractor already knew, you know, fixtures, materials, all that stuff because they had done it so many times and it was very systemized. So just like, hey, yeah, we're going to knock this out. It'll be done. And the investor had like a small percentage of minority stake in the construction company. And so I'm like, oh my gosh, my mind is blonde. I'm just watching this. And so moving forward, that's just the way I ran all of my, my flips. So the following year, because that was 2019. The following year, 2020, I have 14 deals in escrow. March of 2020, shelter in place. Happens Covid real estate's not essential. All those 14 deals, over a hundred thousand in commission. I'm like, I don't know if it's going to close. And I got mouths to feed. Yeah, like lending's changing because of all these things happening. Like non QM loans are going away, which just meant IT people had to shuffle and figure things out. Thankfully, we got all of them closed. They all closed within about 90 days. So a 30 day escrow still turned into a three month process, but we got it done. But I was like, I gotta get in control of my own destiny. And so I joined a mentorship. I just found something where I could jump on zooms cause we couldn't go outside. I joined the mentorship, um, started learning about creative finance, about flipping, about wholesaling. And by the end of that year we probably did two or three flips by ourselves. And that first one we did, I think we bought it at 3,75, put 25 into it, maybe less, and made $60,000 in 90 days from purchase to like sale to the end buyer.

That's 100% return on investment.

And I didn't use any of my own money.

That's brilliant.

I had a private lender that I met trying to wholesale him a deal. And he was like, hey, we're actually lending more. I don't think we want to buy this. And I said, well, tell me more about that. Which I say to everybody, they say something and I'm like, that's interesting. I just say, tell me more about that. Then they expound. And he said, yeah, well usually the terms are 100% of the purchase and 100% of the renovation. As long as it's a really good deal, 75% of ARV, that kind of thing, well then I'll buy the deal. You can be the lender. And he went on to fund most of our, our purchases moving forward. So it was a great relationship. Still to this day. We just had lunch a couple weeks ago and we just went out and started buying stuff. Now I transitioned because flipping is like real estate. You got to go out and every, every time you're done with the deal, right, Escrow closes, you gotta look for the next deal. You're constantly on the hunt. It's a hamster wheel. And I realized I want to set up a legacy. I need mailbox money. Like I gotta have some cash coming in. So early 2021, we had made all this money. Like 2020, I sold personally 31 homes. So like half a million in income basically in Northern California, high priced homes. And I needed to figure out, what am I gonna do with all this cash. I didn't necessarily need to use all my cash because I had the lender, a great partner. But what I learned was I had the confidence because I had a cushion to now go out and just like, just Go for it. And rates were under 3%. And I was like, I need to hold on to these properties. I shouldn't be flipping anymore. So I had one contract and one that I was actively working on. And I was like, there's got to be a way for me to hold these, and there's got to be a way for me to help people provide more value. I believe that we get paid in proportion to the value we provide. Yeah, I can help others. I was a lot more people provide a lot more value. Maybe I'll make a lot more in return, but I'm also just going to feel a lot better. I wanted whatever I was doing to have impact on the community. And so I called up my local shelter and was like, hey, do you have any use for a single family home? And I got lucky. You can't do that with every shelter. And get a good answer, because some people will say, absolutely not. But the director of this shelter happened to be the committee chair for something called Housing first, which is a HUD organization of getting people off the street from homelessness to house, because you can't get services without having an address. And so once they get housed, they have an address now they can, like, apply for stuff with the county or wherever they are, get some help. She introduced me. She told me all about sober living environments, sober living homes or recovery residences. Introduced me to everyone I needed to know locally. And I was like, okay, I'm going to convert this current flip I'm working on into this. So it's going to be a gorgeous house. Dialed in. Luxury, vinyl plank floors, brand new bathrooms, kitchen, all that stuff, quartz countertops. And then I have this other winning contract. I'll just do the same thing there. And so we launched one March of 2021, filled it up within about 60 days, launched the next one two months later, filled that one up within about 60 days. I ended up getting five of these in 2021. All burn strategy, all like, fixers, minor rehab is cosmetic kind of stuff. But I mean, it was also a great time to buy. So rates were low, we'd buy it, do the work in about six weeks, refinance four months later. And yeah, just. It worked out into something far more beneficial than I ever imagined for myself, but also for my community, because today we house roughly 60 people, men, women and children in seven locations. But we just got our eighth a few months ago, and we're finishing up some work there. That'll be our eighth suburb living home.

That's amazing. All right, so there's a couple things I want to ask about that. So you're talking about the BRRRR strategy when you're refinancing. So the BRRRR for people that like. I don't talk about strictly real estate on this podcast. So some people may not understand this stuff yet, but the BRRRR strategy, you're buying it with other people's money. You're raising the value to a certain amount. It's got to be like over 75% ARV. And then you can refinance it right after repair value. Then you can refinance it. When you refinance it. Is there a special type of loan for these or this? Just a residential loan.

So the first two, it was pretty easy because our debt to income ratio was low and we had good income and all of that. So it was pretty easy to just get conventional loans on that in our personal name. Pretty soon we could no longer do that because now we don't have a history. Right. We have. We get hit with the mortgage on our credit.

Yeah.

And so that hits our hurts our debt to income ratio. But there's no income we can count yet because these are like transitional houses, no long term leases like traditional banks and lenders did not like it.

Yeah, that was a good. I was going to ask that.

Nice. Yeah.

Yeah.

So it was easy early on because like we had just finished up the work and we could say we were going to just rent by the room which technically is all we're doing. We, we don't do any kind of license activities or treatment work in the homes. But after a couple of those, now the numbers just didn't work. That's income wise. And so we had to switch products and there's a product called a debt service coverage ratio loan, dscr and that just uses the property itself and your fico, but none of your own tax returns, income or anything like that. So we were able to then get DSCR loans on the next few which had slightly higher interest rates. But it still made sense because we cash flow like crazy with sober living.

Homes and you cash flow so well because you're renting by the room is what you said, right?

Yeah, in fact. So just an example. Right. Let's call it. Well, I have a great example. So the first home I bought in 2017 my family lived in. We had two daughters at the time, but then we got pregnant again and I thought my mom and my grandmother were going to move in with us because they had dementia and just some different stuff going on. Health issues and so we moved a year later, 2018, turn that first home into a rental and rented it out to some. Some Air Force guys always paid a day early because they have a housing allowance. It was great. But we converted it once they moved on to a sober living home. So we went from making 600amonth in cash flow as a long term rental, which isn't bad at all for a long term rental.

That's great.

And like getting consistent, like they were the best tenants. But as a sober living home, we turned that into a women and children's home. We rented by the bed, and we turned that cash flow from 600 to $6,000 a month. One house.

So that's after expenses.

After expenses, yeah. Top line. We were like 9,000. Yeah. Because you rent by the bed and we have two to a room. And so with shared rooms, shared housing now, you know, a thousand to twelve hundred a bed. You know, one bedroom's making twenty four hundred dollars. Yeah. And you get to help people who really need it. Literally, we had people who were living in their car and now they come and live with us. We get paid really well through the county. They get grant funds. It's not taxpayer money, it's grants, but it's. I'm not sure how that works, actually. It might be taxpayer money, I don't know. But I know it's grant funded. I just don't know where that money comes from. I don't know who's donating to California, but yeah, they handle everything as far as, like outpatient treatment, case management, additional supports and stuff. We just provide housing, pay for utilities, provide Internet, some cleaning supplies, and make sure that it stays sober. So we drug test people when they move in.

Okay. Okay. How much of this are you actually doing early on, your drug testing?

Yeah, early on it was me.

Yeah.

Like I was just diving headfirst into this. I banged my head against the wall many times. Made a lot of mistakes my first six or seven months. So I was doing everything. I was literally at the two houses. I started every single day because they were really close to my home, so I could actually walk there. I was doing a 75 hard at the time. Had to do an outdoor workout, so I would just use that to go around to my homes and check in. I was like, might as well just double down. And so that was good. But I didn't know what questions to ask. I was new to everything. I didn't know all the lingo. And so we had people move in who weren't that great. So it was a lot of like heavy management.

You still get to screen. You still get to screen your tenants.

You do get to screen. I just didn't know what questions to ask. I didn't know how to screen right. It was all new to me. I did not have a background in recovery. I never even knew this need was, was here in my area. Because a lot of people aren't just on a cardboard box somewhere. They're what's called marginally unhoused. They're living in their car, they're couch surfing, they'll spend a few days on someone's couch, then get kicked out and then they'll have to be in their car for a night and then they're on someone else's couch bouncing between family member and friends. And so you don't see it. But the need was big. And so that's how I started five homes in one year and now we have six in one city and, you know, they stay full. So the, the management piece was pretty heavy early on. I learned later, like, oh, if I just treat this like I treated my real estate business, if I just put some systems and set some expectations and do this the right way now I don't need to be at the house every day. I can install cameras, I can have a keypad instead of dealing with keys. I can have somebody, you know, get a code. After they fill out our paperwork, we digitized it. So just between software and like tracking our phone calls and all that stuff, sending out marketing emails, running it like a business now 90% of my headaches went away. We stayed full, we got paid on time, it wasn't a hassle. And I got to make sure, like, is this somebody who's coming from a residential treatment facility and has spent 90 days clean, or is this somebody who just got out of prison and no one's even checked on them to see like what's in their system. And it's a toss up on if they're going to do what they need to do or if they're going to turn my house into a prison cell and try to treat it like they're still inside. And so you just learn like how to do this the right way. And now it's, I have a manager, I spend, I don't have to spend any time. I like to go by and I like to talk real estate and I like to give hope and vision because I'm younger. So I, I mean I'm older than I look, but when I walk in, people think if they don't know me already. They think I'm moving in. Like, they think I'm just, I'm trying to like stay in a sober living home and they don't realize I'm the owner. And then we start talking. They're like, oh, wait, what? Like, I didn't think it was. It would be you and you, you have how many houses and how did that work out? So we start to talk and they get vision and hope for the future and yeah, that part's really fun.

That is cool.

Yeah.

You know, I've contemplated this quite a bit because. And I'm gonna steer back into the conversation, but I think it's an interesting thing when you give back to people. It is very. I don't want to sound like, I don't know, uppity or anything, but it does feel really good because at some level, I think you're giving back to yourself. You know, you're teaching humanity, you're inspiring other humans, which is a reflection of yourself at some other level. Right. And yeah, I think it's just, it is a cool thing. Man, I didn't know you were doing that. That's awesome.

Yeah, it's. It's really fun. We've had some guys who were like, yeah, I really want to get into real estate. So I. Keller Williams has like a kind of a no cost real estate school. So I'd get him the books for free and they'd start, you know, going through that process. So it's been cool to help people out. We do help a lot with job placements too, and just, you know, connecting people in the community. But it's just been awesome to see, like, we have a lady who just got reunified with her daughter. So she's like been clean and sober for several months now. She started off with small visits and now inside of her women and children's home has full custody of her daughter again.

And.

And to see that and to be a part of that is awesome. We've housed somebody who was living in her car with four boys and then we got to. Because we bought a property with like three units. There's a two bed, one bath unit in the back. They got to just stay in that unit for about a year and get on their feet and so it's cool. And we're probably the only ones that even allow for single parents like that, especially with multiple children. But it's been really cool as somebody who was raised by a single mom to be able to provide to single moms and single dads. We've even had a dad who. Same thing. They were living in a motel, about to get kicked out because the vouchers run out. They only get 14 days of vouchers from our county. And we got them into another program and housed him and his three daughters in the master bedroom of one of our larger homes that I moved from. And so it's just cool to be able to do that.

Yeah, that's amazing. What, so what is there, there must be some qualification process. You can't just, I mean, are you just taking this home? Like, hey, I got this home and take it to the county, like, hey, I'd like to offer it up as a. Yeah.

So here's what's crazy. Most states have zero requirements around licensing or certification. So there's like no barrier. Barrier entry. Not only that, you're protected because you're not doing any kind of licensed services, you're not doing treatment, you're not doing anything like that. So you're protected by fair housing laws because you're just providing affordable housing. And they are protected class. So if they, if they are in recovery, it's been considered a mental health disorder. Now, substance use disorder, it's a true disease and it's a chronic disease. You're never over it. You're always in recovery once you, you, you're addicted to something like that. And so whether it's, you know, opioids or methamphetamines or alcohol, it's all treated as substance use disorder. And you know, the county, the city HOAs can't even come and shut you down. And so it was really easy for us to start. I just got connected with the right people, raised my hand, said, hey, we're going to be providing these beds, what do you need? They would do a walkthrough. We would like furnish, we can furnish for like 3, $4,000. It's not like an Airbnb 20, 30 grand. It doesn't need to stand out. It just needs to house people and be durable. And so, yeah, it's, there's not much barrier to entry at all. In fact, I teach this now and most of my students can get a home up and running within and full within 90 days.

That's incredible. That's incredible. And what about like, how long are people staying there? So if they're renting by the room, how long? You said there's no lease. So then how long is that up in the air?

Yeah, it's. So it's pretty open ended with us. There's some Programs and what I teach is how to, how to connect with local programs.

Right.

Like I did. So instead of having people just pay out of pocket because they could barely afford, you know, if you're getting 900 from Social Security, you can't afford more than like 600 bucks a month for a room. And pay your cell phone, which in, in the, the U.S. obama made it possible for everyone to have a cell phone. It's like an activity is a human right. So you can get a free phone, but if you're like a lot of times your credit's shot and so your car insurance, which is based on your FICO score, most people don't know that. That's why they ask for your social. Your car insurance can be extremely high. You know all these other expenses. Right. And so I like working with the county or local government programs because they'll have a budget for this, they'll provide the case management. It's that third party level of support. They do all the licensed services and then we just do the housing part. So we become like this partner. And pretty quickly after our second or third home, we became like the go to place for most of our county programs. And so when you do that, you don't have to chase people down for money. And they're okay with us using our license agreement. So it's, they don't have tenants rights. They're not, it's not a lease. They have a license to a bed. And they have rules to follow. And so we have house rules. We're very clear. No drugs, no weapons, no violence. We have a curfew. So all of this stuff comes into play. And I've had, even in California, the few times we've had somebody dig their heels in and say, well, I'm not leaving, either because they were too drunk or high or they were just ridiculous. The police have come in and they've enforced it because it's very clear this is not a lease.

Yeah.

So they take, they'll take someone out for trespassing. It's rare if you set up the proper expectations up front. And most people who live in homes like this understand the process. Like honestly, if they break a rule or if they relapse and they choose not to go to detox and get through withdrawals and all that stuff, they got to move out. We have to protect the, the safety and the sobriety of the home.

That that is, that brings up a good point because California does have some pretty tenant friendly laws. In fact, I saw one the other day. I'm not sure if you saw this. It was like an Airbnb and the person that's staying there has refused to leave for almost like 18 months. And not only that, like, they're demanding that the person pay them a hundred thousand dollars in relocation fees. Yeah.

Some of that is LA County, LA is just okay. But some of that is also California and Airbnb being crazy because they're not taking this person out. And I think that person even tried to sublet and let other people Airbnb it and they're making money off of it. Like it's. How does that happen? We don't have that issue.

Yeah, it's not a lease exactly. Well, yeah, that's, that's crazy. And probably because also these people understand that, you know, they're, they're trying to reintegrate at some level. Right. They're trying to get back into society and be a part of this.

Yes, I don't think I answered that question. So the county programs that we have, one of them is a subsidy program. It's nine months. That's it. So three to six months, it'll be 100% paid for. But after that, then the client themselves, the resident needs to pay like 30% towards their monthly contribution. And then after that it goes to 50% and then the program's over. So typically we see people stay somewhere between like 9 and 16 months. Okay, let's just call it a year. And that's how long people really need to save up, work, like, make enough to actually make sense and get an apartment. Because you think of like, how much rent has gone up the last few years in my area. I remember when I got married, we were in an apartment for $925, two bed, one bath apartment. That same apartment today is like $2,100, maybe more. And so someone working minimum wage or they have a felony, they're trying to just like work swing shift or night shift somewhere. They can't afford an apartment on their own. They don't make three times the rent to be able to qualify for that apartment. So they're with us for a long time to be able to save up enough first month, last month, all that stuff, and then fix stuff, fix their credit and maybe even, I mean, if they're moving out, they're probably going to some kind of income based apartment, which we have connections with now too. And then we created kind of a phase two where if they did really well in our sober living homes, they can move into this other kind of home that's like just a private room instead of sharing a room. And we'll give them a good reference. They're actually paying, like, monthly rent. So it's a stepping stone.

Yeah. That's really cool. That is such a cool model, man. And this stuff is available in every state, you're saying?

Just about every state. There's only three that require a license, which would be Arizona, Utah, and New Jersey. But it's actually what they call a license is. I mean, it's for a structured summer living home, meaning that there's a house manager, there's rules, there's all that stuff. If it's peer led, if there's no house manager that's living, you're not paying anybody to be there. Honestly, you can still do it unlicensed, because, again, you're just renting by the room. But if you're providing, usually they have criteria. If you're providing house rules, you're drug testing people, making sure they stay sober. And a manager and like, one other thing, like, you're connecting them with resources. Now it's considered structured sober living, and you have to go through the licensing process. But everywhere else, it's the Wild West. So you hear good things and you hear bad things. Right. Like in Arizona, although they require a license, the FBI just shut down about 70 homes for, like, insurance fraud. They were actively getting people from reservations, Native Americans from reservations, keeping them on drugs so that they can bill insurance. Because when you're billing insurance, it's like seven grand a month. You can charge Medicaid. It was insane. So when you hear about sober living, there's, like, the dark side that is always in the news. I try to do it the right way and try to help people understand, like, there's ethics behind this. There's also also an organization called the national alliance of Recovery Residences nar. And they're all about this, too. So they're starting to pop up in multiple states, and they have a really strong lobbying arm. So they're going like. It just. Just happened in Washington, it happened in Texas. In order to get any kind of state funds, you have to go through their certification process. It's really simple. Like, we now teach how to easily go through that. It's like 500 bucks a year. But there's a code of ethics. And so I'm a big proponent of, like, doing things ethically, treating people like people, not just packing them into a room. That's why we do two to a room. I know people that do, like, bunk beds, four to a room. I just Think that's ridiculous. You're going to have higher turnover. You're going to, you know, people are going to have PTSD from prison or jail. It's just. It's not a good solution.

Yeah, so. And you said there's. There's certain types, too. Do you get to make. Designate that, then? Because you said you had one that's just women and children. One is. You also mentioned people getting out of prison. And when you say sober, I think drugs and alcohol, but obviously there's other.

Yeah, but I think it is drugs and alcohol, and people in prison still have access to all kinds of craziness. And so when they come out, you're helping with reentry, or at least, like, you're providing them a safe, clean, sober space. They're getting additional help from a parole agent, maybe a case manager, if they were on drugs. They're going to outpatient programs. Because we do get a lot of people who come out and they're like, literally, they're asking their roommate, like, where can I get meth? Where can I get whatever? And thankfully, if you have the right people, like, they'll tell you what's up. Like, hey, this guy just asked me for this stuff.

And.

And so I do always have some residents who are like our eyes and ears and let us know what's going on, because it's to protect the safety of the house. They. They don't want to end up back where they were before.

Yeah.

But, yeah, we get some reentry programs. And I'm hoping I'm answering the question here.

Well, I'm kind of asking, like, how do you. How do you classify which house is going to be which?

You.

You get to do that. The county does that.

So we do the children, we run the house, how we want to run the house, all that stuff. We can set our rates for the most part. There's one program that's, like, kind of weird, but any other program that's ever done housing before, like, they let you set the rate, and there's very little paperwork, honestly, which is crazy. But what I like to do is just a ton of market research, and I ask a ton of questions, and I'm asking what. What population needs housing the most? What areas need it the most? You know, if I provide that for you, can you ensure, like, do you have enough lead flow? Do you have enough people that actually can fill that. That house and keep it full? And so our first two homes were homes for single men in a city that really needed homes. There was only One other and cause for some reason, well, we have a bad area of our county, Vallejo, California, where E40 is from. Like that. You made it famous. Yeah, but they've. In 2008 or 9, this city went bankrupt. They haven't been able to keep cops for a really long time. Lots of gang violence and lots of drugs and prostitution. And so it's an area that's highly served by homes like this. But the opposite side of the county where I am, had like nothing, even though there was still need here. And so that's why I built out so many homes here. So just asking those questions, where's the need? What populations need help? So my first two homes were single male homes here. My third home was a women and children's home in Vallejo and it filled up immediately, but that only lasted about 18 months. Then for some reason, we stopped getting women and children referrals. So we converted it to a male home just because as people moved out, we weren't replacing them with women and children. Part of that is because we also opened a woman and children's home in, in my area in Vacaville. And the people didn't want to stay in, in the bad area in. So now they're moving over here. So it's like I kind of cannibalize my own home over here. So now it's a male home. And so we just keep asking that question. And so our eighth one, our probation department came to us and said, hey, you open homes? Can you open one for like 18 to 25 year olds? Kind of. That aged out foster care. And so that's why we bought that home. And we said yes. And like, here you go. And so it's just that partnership of like, what do you guys need? We'll fill it. Because if you do that, if you ask those questions, you provide that value. Why would they think of anyone else? Like, I'm the first phone call. Because this is what we do.

Yeah. And they know nothing. They're working with so much other stuff in the system. Obviously they don't have time to do that themselves. So, yeah, go to the real estate guy. Down.

True, but it also, I mean, it helps to differentiate yourself. And most people aren't running it like a business. Most people don't have more than one home. And a lot of them live in the home and the rules change every day. Curfew changes, they get mad at somebody, they're micromanaging. Like, it's just not a great environment. So there's a lot of turnover we get a lot of people who move from that type of environment into our homes that are more independent because we don't have live in house managers. But I do have a house manager. I have substance use disorder counselors, like they're certified by the state and they can do the work. They just stop by every single day to all of the homes. They don't live inside of an individual house. But yeah, it's. We just maintain that relationship. And if you do that, like I just found this out. There's 150 homes like mine, transitional housing, designated homes in my county of close to half a million people. We house 20% of all of the clients in our seven homes. And so we just built that relationship where we're really easy to get a hold of. We have a phone system to where if somebody calls and they don't get my house manager, then it rings me like we're always answering. Even if it's 4:30 on a Friday and they got to get this person housed before the weekend. We just make life easy for the people referring folks to us and that's it. And they know if they call us, we always have a bed somewhere.

Yeah.

If we're full, I'm gonna buy in another house so I can provide more beds.

That's, that's a really cool strategy, man. I really like it. That makes me want to look into this as well. What, what's something I haven't asked that you think people should know about this or what's something that comes up a lot with your students maybe?

Is it that easy? It is that easy. It is that easy if you just follow the process. Right. If you have a system and a process and standards which is like what we provide now. I wish I had that when I started. But also I think there's, you got to be the right personality style or the right fit for, for this population. I truly care about people and I know their stories. And I'm not just like on a land grab to shove people into homes. Like if you ask me about anyone in our houses, I know their background, I know what they're trying to work on with their kids, their recovery goals. Even though I'm not in the day to day, like I still try to take the time to find that out because that's what I'm doing this for. Right. The money is great. It's insane. We can make 10 to $12,000 top line in a four bedroom, two bath house. It's insane. And then many of those homes have interest rates below 4%. So my total cost, including my house manager, is probably three grand to 3,500amonth. So we're cash flowing six, seven, $8,000 per house. So the numbers are insane. But you gotta be able to just listen to people's stories and actually have a heart for it. We don't kick people out of their relapse. We give them a chance to go to detox, get through their withdrawals, maybe get some medically assisted treatment. Ten days later, they can come back seven to 10 days later. Once they're through the withdrawals, we'll hold their bed. Their program will continue to pay for their bed. Usually you hear about sober living homes, and it's as soon as there's a relapse, which is like 60 plus percent of people in recovery relapse, then they're kicked out and they're homeless again. We don't do that. We're giving people that second chance. And a lot of times, if you do that up front now, they never go back to detox. They stay clean, and 12 months later, they're moving into an apartment. We've seen it over and over again.

That's really cool. I didn't know. So you pay the house manager.

I have one house, well, two house managers now. But I do pay them in like 25, 30 bucks an hour. Like commensurate with whatever the going rate is for somebody who has, you know, five years of experience in, in substance use disorder counseling. I needed, I learned six, seven months in. I needed somebody who, number one, understood what people were going through better.

Yeah, yeah.

Because I was like, man, like you. You actually chose not to go to detox and to like or on your way there. We had this guy, He. So this is a funny story. He walks in to the kitchen.

So.

So I walk into the kitchen of my first house. There's a puddle on the ground, and I'm thinking, it's been raining. Do we have a leak? I don't see anything on the ceiling, but thankfully I put in these cameras. So I put cameras in the living spaces as well as all around the outside so I can see who's coming.

You're allowed to do that.

You can't, like, do it in the bedrooms or the bathrooms.

Yeah.

But in the common spaces for sure. And so I have one in the kitchen looking at the pantry because that's where everyone stores their food. Just keeping people on it. Don't steal food. Like, you'll be on camera. Right. It's proactive. But I go back and I review the footage, and this dude stumbles into the kitchen, pulls down his shorts, pees on the floor. I can't unsee that now. I had to have a conversation with him, like, hey, clearly you were drunk. What's going on? He's crying in this conversation. Well, first he's too drunk. He's like laying in bed. I'm like, you got to sleep this off. I come back, take his car keys. I come back, he's sober and he's crying. Like, I don't want to do this. I don't know why I keep making this mistake. So we're like, well, you need to go to detox. He's already like, can't see his wife and kids who live in another city. Yeah. He's like, okay, I'm gonna go. I found out later, he. Although he got in, he secured a bed, he's down the street, he doesn't make it in. He pulled into a 7 11, grabbed a couple of 40s. People found him, like unconscious in his car after just downing a couple of 40s. And like, it's like, man, he. He ended up going to the hospital, but then, like, he just moved his stuff out. Like, he didn't even go to detox. Like he had a space. We would have kept it, but he, he just made a choice, right? So that's the sad part. You still deal with the, the negative sides of people who just are making bad choices. They're not ready, they haven't hit rock bottom yet. And so that's the heart wrenching part. So if you're going to get into this and not have a manager, just understand that the first 90 days it's probably going to be you and you're going to hear all this stuff. And if you've never been in this world, you're going to hear a lot, see a lot. That's just going to break your heart. And so I ended up bringing in people who, like, could handle that better than me. And also, I'm too nice. I'll give people too many chances. And so I need somebody who could come in and like, give them tough love. Like, I will support you, I will fight for you. But you got to do what you're going to do, like what you need to do. And you know, publicly, you're my boy. I'm fighting for you in here. If you're not doing what you need to do. Like my manager, she's like, I'm gonna be like your mama. I'm gonna support you out there. I'm gonna kick your butt in here and make sure you do what you need to do. And so she's been great.

That's awesome. I like that. I mean, they have. She probably has training experience and that makes sense.

Yeah, literally 10, 000 plus hours. Like to get these certifications, you have to log your time and like supervise work hours. She's been doing this for well over five years. So many counseling sessions. Like, she's solid. Yeah.

Yeah. That's what would worry me a lot too, is having to deal with that, not knowing how to deal with it without, you know, the right way.

Right.

Like, I'm not trying to ruin somebody's life, but at the same time, like, I'm not trying to ruin my house either, you know?

Yeah, 95 of these guys and girls, they're. They're good, they're solid. You get a little bit of riff raff every once in a while, but it's easy, especially with a third party. Stuff like call the case manager. We had a guy with an AK47 once. No, it was an AR15. He tried to sneak it behind his back. 42 year old gangbanger thought he was a cool guy, right? He's like an H vac technician. But come to find out he had just robbed somebody in Sacramento. Like another gang guy, rival gang, comes back to the house, trying to like hide out. I see this all on the ring cameras and these guys don't realize, like they pick up audio too. I can hear him talking about it and I just send it to his, his po. Three days later, the sheriffs come in, take them away, find the gun, all that stuff. But it's like really? And so occasionally we'll see a gun, but like nothing's ever happened in our homes. And honestly, the gangbangers, the bad guys, they, they understand the service we're providing. We're providing a place for people to land safely out, coming out of jail or whatever. They're actually more upset that their guy did something stupid and brought bad attention to them than at us. And so like, we kind of have this weird layer of protection from the bad element because we're providing a service, we're helping people out. There's like a code come to find out, you know, you learn all this stuff by running houses like this.

Yeah, well, I mean, it makes sense. You're not just helping one guy, you're helping a bunch of people out. And yeah, they don't want to lose that opportunity too. At least some of them.

Yeah.

So. Yeah, that's amazing, man. I love It. That's. That's really cool. You have any plans to do any in any other counties, any other states?

Yeah, working on a partnership right now. People keep coming to me like, hey, I have this property here. There lots of people with vacant units right now. It's crazy. Three or four vacant homes, and they're like, hey, we just finished up renovations. We'd love for you to run this and partner with us. They just want to be a landlord, buy more property and have us come in and operate. And so that's always a possibility. We have to look at it like a franchise. Who's the partner? What's the location? Figure all that stuff out, run the numbers.

Sure.

But we have that happening in a couple of places right now. One in Massachusetts, one in Alabama.

Yeah. Yeah. That's awesome, man. Really cool.

Yeah.

All right, well, we're getting to the.

Top of the hour.

I'm going to shift.

I got.

I got final four questions for you, and then we'll kind of.

We'll round it out.

But. So this has been an amazing conversation, but the first question I always ask guys is, what is one thing you've implemented in your business over your career? Maybe in the sober living, maybe in your brokerage as a real estate agent, whatever. What is one thing you've really implemented that has been complete, absolutely pivotal for your success over the years?

One thing.

If people had to focus on one thing, what would you give them?

Gosh. And it doesn't sound tactical, but it is. And you mentioned it earlier, it's who, not how. It's find the who. Like, early on, even in real estate, I was like, who's doing this at a high level that I can learn from outside of my area? I didn't want to just sell three homes a year like everyone else. In my office, I wanted to sell, like, 30. I wanted to sell hundreds. So I found the people who were doing that, and I got into. I figured out a way to get in that community, that network. When it came to real estate investing. I got into a community where everyone was talking about wins, and I realized pretty quickly, like, oh, nothing special. Like, they're not smarter than me. They're not more talented. They're just getting knowledge and applying it, taking action. That's all it took. So, same thing. Just find systems and models, get into a room full of people doing what you want to do, and you'll be there.

That's awesome, man. Yeah, I'm a big fan of that. All right, next question. Very similar. What's one thing You've implemented in your life that has been pivotal for your health.

Ooh, that's a good one. Probably putting exercise equipment in my home, having a peloton. I bought that in 2020. Changed my life. The ability to just get workouts in, not have to worry about, like, oh, it's too cold outside. I don't want to drive to the gym. Stuff like that. Stupid excuses. It's like, now it's like, in my bedroom. I don't have an excuse.

That's great. I've always been a fan of a home gym, actually, so. Yeah, I can't agree more with that. Our next question. Go ahead.

Yeah. Yeah, I think also, like, doing your own blood panels and kind of knowing where you're at with, like, your true internal measurements and KPIs, I think that's huge. So. Inside tracker. I love it. Love it. For the ability to go and get my own, you know, blood draw, see where I'm at, kind of tweak my diet based on stuff. I see. That's been really helpful, too.

Yeah, I. I actually used that a couple years ago. Really liked it. I was tracking it for a full year. Really cool. But you got to make the changes.

Like, it'll give you, like, it's just like anything else, right? You can learn and learn and learn, but until you apply, like, it's. Yeah, yeah, no point.

Yeah, that's cool, man. Inside tracker. All right, next question. Which brings you the most joy right now?

Hanging out with my family. We've. We've lost a couple of friends this past summer, and it hit us pretty hard. One person took their own life. Another person just was taken too soon. Like, people really close. The family, really close to us. Lost somebody, and. And so I just spend a ton more time at home hanging out with my kids, realizing, like, I could work all day long. But none of it matters if my kids grow up feeling like I was absent or even if I was home but not present, if I was always on my phone, on my computer, trying to build businesses for them, for them, but, like, they already have everything. Like, a year ago, we bought a huge house on a couple acres with an olive orchard, and we homeschool like, they have everything they ever wanted. I don't need to keep building. So, yeah, just hanging out with my family brings me joy.

Yeah. At some point, it's the time they want. They don't want the. The house, the tree, or the whatever, the acres. You know, it's the time.

I have five daughters, so.

Yeah.

Yeah, I forgot one to 11. At the end of this month, they'll be two to 12. Because I have two that have a December 30th and a December 31st birthday. But yeah, it's my oldest for sure is at the point where it's like car talks with dad hanging out. It's making a big difference. So just working from home a lot more. I'm not in this office much at all. Maybe, maybe two, three times a week now for just a short period of time.

Mostly working from home, you know, and that's amazing. That's a good point. Because a lot of us say family is the most important thing. And then guys, men specifically, and then we go out and do our mission, which is make money, provide the fan for the family, get a roof over their head, get food on the table. But we've also bought into the system that or this concept that we have to work harder to make more money. And what you've done is been able to systematize and invest in things that create money for you so you can work from home. And I think that's phenomenal. And I mean, I talk about this all the time. Like, this is. That's the shift. I think that's the shift from blue collar to wealthy is when you can figure that out. How can I create make money while I'm at home with my family?

Yeah. And I had a coach who was pushing this on me for a long time because I kept trying to grow my real estate team and it took the most amount of time energy for, honestly, the least amount of return. I mean, our sober living homes give me more net income than my real estate team. And so for next year, I don't even have growing the real estate team on my goals. Right. It's just growing the passive income and then like the coaching side, making more impact, helping more people open up homes like this and understand the opportunity and run it the right way. That's so much better than anything I was doing. Again, collecting this, like, small percentage of. Even if it was through other people, it's still a small percentage of helping other people. And instead of investing myself. And so now it's all about monthly recurring revenue and passive income.

That's brilliant, man. Somebody needs to come up with an equation to show you how much more valuable a hundred dollars is when it's earned with less time. You know, over.

I don't know.

I'm not smart enough to do that. But I think that's.

We can figure it out.

Okay, last question. And this goes in line with the the podcast, if life was a game, and I kind of look at that as a game sometimes, how would you know if you're winning or not? Do you have some type of key metrics that you keep track of in your life?

That's good. I do. I mean, you and I both know from. From so both in gobundance. And so we have a one sheet. We have a tracker. Right. We have KPIs. And so it's like, how many workouts did I do in a year? Not in a week. Cause it's really easy to fail in a week, especially if you get sick. Really hard to fail in a year if you give yourself that much time and just like palliate off and you get time to adjust. But it's really like how many workouts, how many date nights I take my kids on, on individual one on one dates called family board meetings. So they get to choose the agenda for three or four hours. And it's like my phone's off. It's just focused on them. And so it's like, it's, it's mostly how am I doing in those areas of life? I try to look in every area. I'm trying to do more self care days. I'm tracking my days off, my weekdays off next week or next year. And so I went at least 25 weekdays where I just don't even think about work, which is really hard for me as a serial entrepreneur. Yeah.

Yeah.

Like I already have another business I want to start to provide wraparound services to our residents and. But I'm finding the who. I'm not even going to be involved in it. I'm just going to. Here's the vision. Here's what we need to do. You go run it. Yeah.

That's awesome, man. That's awesome. All right. This has been an amazing conversation, Andrew. I really appreciate you coming on. Where can people learn more about you? And we. I know you have a course, so where can people sign up for your course, learn about your course, your coaching and get in touch with you, man?

Yeah, you can always find me on Instagram, the Andrew Lamb or soberlivingriches.com we have a master class there that dives a little bit deeper into how I started all these homes and kind of the systems we put in place. And then you can schedule a call with myself or my team to talk through what that looks like for you. And if the community makes sense, we have. It's not just a course. It's like it's a community 247 and then coaching calls as well. Every, every week we have a coaching.

Call.

And yeah those are the best places to find me YouTube as well. There's you can deep dive on YouTube and to some stuff that's very sober living specific longer videos but soberlivingriches.com probably the best place and if you want a partner if you have a real estate soberlivingriches.com partner where we could potentially come in and operate inside of homes you already own.

Perfect Ben. And all that will be in the show notes so if you're you know driving or running right now like you'll be able to go back and look at that. So Andrew, thank you so much for being on the show man. This has been awesome.

Yeah, thanks for having me. Always a good time talking to you.

Yeah man. Yeah. All right. Thank you everybody for listening and we will see you on the next one.

Take care.