How To Lose Your Money... | Paul Moore Interview

All right, all right. Welcome back to the Investment Fund Secrets Show. Today, we got with us, Paul Moore. Paul, welcome to the show. How you doing today?

Hey, it's great to be here.

Let me go through your bio really quick. I would— I usually just ask, you know, tell us about yourself, but you have such an extensive thing and it would just take too long. So, I'm going to go through this really quick because you have quite an impressive career in what you've done. So, originally worked at Ford Motor Company, then you co-founded firm where you were the finalist for the Michigan Entrepreneur of the Year 2 straight years. And then you sold that to a publicly traded company and then you started to do other things, right? You got onto— on here it says investing in real estate, found multiple investments, development companies, appeared on HGTV and eventually completed 85+ real estate investments and exits, including a large multifamily development. And then you went on to be a contributor to Fox Business, regular contributor to BiggerPockets and producing live video blog content regularly. Paul, you also co-hosted a wealth-building podcast called How to Lose Money. And, uh, he's— you've been featured on having over 200 people on your show. The Offer of the Perfect Investment: Creating Enduring Wealth from Historic Shift in Multifamily Housing and Storing Up Profits. Capitalize on America's Obsession for Stuff and Investing in Self-Storage. Paul is the founding and managing partner of Wellings Capital, a real estate private equity firm. And now you're getting into the fund world, which is what we talk about as well. Now, you just mentioned to me as well, you're writing another book. Is that right? What's your new book?

It's called Warren Buffett's Rules for Real Estate Investors, at least tentatively.

Gotcha. Okay. And when do you plan to launch that?

Yeah, probably late 2022. I got this self-storage book coming out in late '21, and then we're going to turn our attention to that. The draft's almost finished. We found that Buffett has— even though he doesn't invest in real estate directly in general, his principles are fabulous for real estate investors. And so what we started doing is we started taking those principles and converting them over to the mind, you know, to hit real estate investors where they are. And it's just been a lot of fun. Hmm.

Geez, that's all I'm excited to see when it comes out. Yeah, because yeah, you don't hear Warren Buffett in real estate, just never, never, you don't put those 2 words together much. And it looks like you guys have, which is awesome. So, okay, tell me about your show, though. I'm so curious. How to Lose Money. How is that a podcast? I see it doing very well. How to Lose Money. What's the thesis of the show? What do you guys talk about on there?

Yeah. So, for years, I would go to these conferences and I'd see these amazing speakers up front and they would be telling about all their success. And I'm sure it was all true and real, but it seemed incomplete to me because I would sit around at lunch or at the breakout sessions and hear these guys just so depressed like, oh, man, I'll never have those family connections. I didn't have that education. I might as well quit. And I'd hear people say stuff like this, and I thought, wait, you don't know the whole story of the pain and loss and failure these people had to endure on the way to where they are now. And I thought, if I ever got on that stage, I would tell that story. And I got to meet a lot of those people when I did, and they had those same losses and failures and insecurities that everybody else had. So I decided to interview people about that. So we interview executives, Entrepreneurs, investors, et cetera, about their pain and loss and failures on the way to the top. Hmm.

Gotcha. I love it. Well, and that's such a good point because you're sure everybody— well, it's like the Instagram, whatever. Everyone loves to talk about how great everything is. And it's, it actually, it's a lot more— you connect a lot more with somebody when you hear about their losses and actions, because it's real, right? Because everyone goes through that. It's not flowers and roses for everybody. So I want to ask you, Paul, I saw in your bio an interesting topic on here that you're— and it was one of your, you know, potential things. One of your episodes you guys have done, how you went from $1.5 million in the bank to negative $2.5 million in debt and then back out of it. Can you tell us that story? And actually, well, if that is— I'm talking about losses, if that's one of your biggest loss periods, and I'd love to hear more about your story and things like that, but tell us about that first.

Yeah. So I was 33 years old. We sold our company for $3 million. So I had a little over $1.5 million in the bank and I moved to the Blue Ridge Mountains of Virginia, tried to start an international student nonprofit where organization. We built a farm here, and it was just a lot of fun for a while. But then I started investing in real estate, and of course, 2006, '07, '08 happened. And by the time, you know, we were in late 2007, exactly a decade to the month after I had made a lot of money at a young age, I had $2.5 million in debt. My business partner comes to me and he said, I can't do this anymore. You can have all the assets. You can have all the debt. And so, that was a great day. And he and I are still friends. But at any rate, I had to figure out how to deal with this.

Wow.

And I had this morning meditation practice. And one morning, I was sitting there wondering what to do. I wasn't really scared, but I had this thought, what would George Müller do? Now, your audience might not have heard of George Müller. George Müller was a Hellion in Germany in the 1800s that became a saint in England. He went there and he eventually took care of a total of 10,000 orphans. orphans over that century, most of that century. And he never ever went into debt and he never asked for a dime from anyone, but he raised better part of half a billion dollars in today's dollars. And so I thought, what would he do? He would do something really radical. And so I called a couple friends together who were encouraging me to consider bankruptcy. And I said, we're gonna give our way outta debt. And that went over really well. And then I told my family the same thing. I had 4 young kids and I wanted to— I want to leave a legacy. So, I said, look, we may be in real— we're in trouble here. We're going to— let's just see, you know, what's going to happen. Let's start giving generously and really believe in the, you know, the power. Some people call it karma. Some people call it sowing and reaping and all that stuff. We just said we're going to go ahead and do that and see what happens. And so, we started January 1st, 2008. Now, Bridger, you got to remember, we didn't know we were about to hurtle down the black hole of 2008.

Yeah.

We thought maybe the worst was over, maybe we were coming out of this. And so, we started giving to charities, nonprofits, church, things we cared about. And 4 weeks later, I ran into a guy at a Subway restaurant who gave me this lightbulb idea that I took and ran with, and I went down to the county Planning and Zoning Department 2 days later and said, look, I've got this 5-acre waterfront property that you've told me over and over I can't subdivide. I think I found a loophole in your law that says I can subdivide it. And the lady stares at this plat, she looks back at me, and she said, I've been doing this job for decades. No one has ever come up with such an outrageous scheme to circumvent the law. Then she laughed and she said, but you did, and you're right. And she said, you can subdivide this property. So, there was still a lot of work left to do after that. But 13 months later, we had sold those properties and we were completely debt-free.

Huh. Wow. And this is right in 2008?

Yeah.

Well, there's a lot of things I want to unpack from this. Number one, like what gave you the idea to get, like you said, give your way out of debt? And I've heard, I've actually read, there's a book called The Go-Giver that talks about this. There's a number of, actually, I listened to a professor from Syracuse. She came and spoke. She did a whole study on, it was very impressive actually, on the more you give, the more you receive. And she tried to make it as scientific as possible. It was really interesting because most people, you've heard that before and it's kind of like a religion or a theory. You can't put it in tangible things. She's like, she actually went out and studied this huge sample size of people and said, whether you're rich, whether you're poor, if you gave money, what would happen over the next 3 years, 5 years, 10 years if you gave, let's call it 10%, 15% of your income?

Wow.

And she found that those people made way, not just a little bit more money, way more money. I can't remember the exact. I don't want to give a false statistic on here, but way more money. They were happier. There was just this really cool— and she put it all into this study and published this paper at Syracuse University, wrote a book on it and everything. And so, ever since I heard that, I just— and she kept making the point of a lot of people say, oh, once I'm rich, then I'll give.

Right.

Once I'm at the end, then I'll give. But in reality, you got to give. If you want to play that game, you got to give now. If you don't give now, and that's what she found, if you don't give when you're poor, you won't give when you're rich. And so, I wanna ask you, what gave you that idea of we're gonna give our way out of poor and what's your thoughts on that?

So, I think it was George Mueller's example. George Mueller, like I said, he lived this radical life of generosity. When he died, even though he'd raised almost half a billion dollars, he had like 2 books and like a chair to his name. I mean, the guy was incredibly generous And the more he gave, the more he got back. And I really believed that that was true, and it was true. Now, I don't think, you know, like God's some big vending machine in the sky and I'm just going to be able to put in a dollar and get, you know, my Zagnut bar out automatically. But I really do believe that that principle is true. And people all around the world and all kinds of religions have found this to be true. People with no religion found it to be true. And I'm so glad to hear about that study. I can't wait to look it up.

Yeah, I'll have to find that. She spoke at BYU to a group and I was there listening. It was awesome to hear her talk. But yeah, really impressive speech. It was cool. Well, that's an incredible story too, out of the '08 crash as well. It's easy to give when the economy's up, when everyone's happy. It's easy to give then. It's a lot harder to give when things are down and things are looking bleak. Speaking of that, I want to switch topics here. We talked earlier, you've done other contributing to other podcasts or even your own podcast, talking about the current state of the economy and the world economy. A mutual friend of ours, Jason Hartman, came on my show and talked a lot about this. I want to hear your thoughts from your point of view on— we've printed enormous amounts of money. I don't know the exact number. I've heard anywhere from 20% to 40% of our money supply has been printed in the last 13, 14 months, something like that.

Yeah.

You have free money, almost zero interest rates. You've got a A rent eviction moratorium. You can't evict people. And you have this migration of people moving around the country. Anyways, it's just a very interesting time. I keep looking at history to try to find other times similar to this. And there's a few similar times, but I want to hear your thoughts on macroeconomics. And again, this is not financial advice, but let's hear, I want to hear from the book of Paul Moore. What do you think the next 18 months, 24 months looks like? And what data points are you focusing on? Right.

Yeah, so great question. Um, I would recommend that everybody go back and hear that episode that you did with Jason Hartman. It was fantastic. He talked about the Cantillon effect, and he talked about the fact that interest rates are the lowest they've been in 5,000 years of tracked interest rates from Earth history. And it's true, I looked into it myself, and it appears that we are in this really weird time. It's sort of a golden moment, I think. Now, when we think about inflation, we think about the late '70s, early '80s, gas lines, shortages, people with a pension who the pension check was able to cover 2 months' rent or mortgage, and now it could only cover 2 weeks because things had gone up like 4x. The supply of money was part of the issue. There's all kinds of issues that Jason and you hit really well on that podcast. But the thing is, We now have inflation that is, by their own admission, going up a lot. And then we have more inflation that, as Jason talked about on the show, is not being reported. So, we've got this high inflation that's heating up. Jason mentioned that 30% of the money supply that's ever been printed in the US has been printed in the last 13 or 14 months. You've got this just math equation that says there has to be A lot of inflation. But at the same time, unlike the early '80s, we've got low interest rates. So, there's an opportunity right now to lock in a low interest rate on, let's say, real estate investments. Lock in that rate. The banker doesn't get to share. They don't get to inflate. But you as a landlord, as— and I'm in the real estate world, of course, so I'm thinking about real estate— as a landlord, as a real estate property owner, you can inflate. You can inflate the rents. You can inflate your revenues. And so, if you can do that over 10 or 12 years, or 15 or 30, or even certain FHA loans, 35 years, imagine what inflation will do to rents and bottom-line profits over the next 35 years, from now to 2056, versus— Largest cost, typically, your mortgage payment, your debt service. Constant over that whole time. It's an incredible moment. We're in this window, and Bridger, I don't know how long it'll last. They say interest rates aren't going up, but, you know, I can't count on that. I don't think any of us should. But right now we have this opportunity.

Well, so your play is, you know, lock in a low interest rate, buy up, scoop up assets, and hold for a long time, be able to service the debt. Is that correct?

Yeah. And that's, that's a new thing. I've been warning— I wrote a book on multifamily 5 years ago, then I've been warning people the last 3 or 4 years not to buy it because it was overheated. But now I'm thinking it's got a long runway ahead with these revenues, you know, that can go up.

So you don't see, I mean, so I live in Utah right now. I believe its appreciation over the last 12 months is 20% on average residential houses. So the house I'm in, I mean, 20% in a year. It just seems, they call it the everything bubble right now, right? Everything's inflated. Everything's going up. Do you see a hiccup in the real estate market with a rent moratorium ending where a lot of people are going to get foreclosed on or evicted? Do you see that, a lot of supply hitting the market? Or do you think these prices are actually, they're high, but they're good, they're going to keep going up? What are your thoughts on specifically real estate? Yeah.

I really can't predict. I mean, there may be some type of hiccup, but I think that there may be a cyclical trend that has a downturn, but the secular trend, the bigger Mm-hmm. I mean, I don't see how it can't go up with the amount of money we've printed, the rush from people in Manhattan, LA, San Francisco, Chicago rushing to places like Utah, like where I am in Virginia. I mean, people selling a $2 million condo in Manhattan can't believe the almost mansion they can get on a waterfront, a beautiful lake. here in Virginia. And so, and then even put a lot of money in their pocket. So, it's a really unique time, you know, with people rushing out of cities, realizing they don't have to, you know, live and work in the same place. Also realizing life's shorter than they thought, you know, with the pandemic and everything. People are like, you know, I think I'm going to live where I want to live. I think I'm going to drive the convertible I always wanted. I think I'm going to get that four-wheeler or that RV. RV sales are up hundreds of percent from what I've heard. In the last year. It's hard to get a four-wheeler. I bought a four-wheeler and can't find a utility trailer for it to carry it on because they're like 8 months out. So, you've got low supply. You've got, because of labor and the COVID thing and over the last month and everything, you got this massive demand, massive increase in steel, lumber prices, house prices, other stuff. It's just a really wild time. And it's a time that some people are going to get very wealthy if they can harness what we just talked about as far as low debt.

And I want to just add, a few more gray hairs than I do. And I've never been through a major crash. I mean, 2007, 2008, I was not really, I mean, I was in school still. I was in high school, or I was even before that. I'm in my mid-20s right now. So I haven't seen a big crash. I haven't lived through one. And usually that changes you as an investor. You know, you had the dot-com. And I talked to, you know, older, my dad or grandpa or anybody in my family that have lived through that and it changes their mentality, right? And they, a lot of people are saying it feels like it felt in 2005 right now. Do you see a similar, you know, black swan event happening soon? Just, and just as me from ignorance, I haven't lived through it, right? Just seeing like, it just seems like everything's going up and that's the moment it all drops out. Uh, thoughts on, you know, on that? Do you feel like it's a similar, a similar thing, or are we in a different, whole different ball game?

Yeah, it's hard to tell. You know, I like to follow Howard Marks as well, and Howard Marks wrote Mastering the Market Cycle: Getting the Odds on Your Side. And in that book, he talks about, you know, that it's really impossible, or almost impossible, to really predict black swan events, etc. He said all we can do is make the best decisions for where we appear to be in the cycle. And, you know, where we have appeared to be in the cycle is multifamily's overheated. There's not a lot of available in multifamily and single-family homes, meaning that there's not a lot of value that can be created by acquiring it and running it well. There's other asset types like that I love, like self-storage and mobile home parks, where there is a lot of intrinsic value. We can get back to that if you want. But as far as where we are in the cycle, I want to dial in personally on doing the things that make sense regardless of what happens. Locking in low debt, getting assets with intrinsic value that creates a margin of safety. Those are 2 things I can do in any market. So, that's what I'm focusing on regardless of what's coming.

I like that a lot. So, let's touch on that for a minute. You've got, you know, a real estate fund, I believe you're launching. Walk us through your guys' thesis, what you're thinking, if you don't mind to share. But what's the plan for the fund? What are you guys planning to do and ways, like you just said, to find intrinsic value? Whether it goes up or down, we're going to be just fine because we have, you know, we're following this plan. Yeah.

So, we're launching our 4th real estate fund this summer, 2021. And our thought is that it's been hard for people over the years. People would love to get into commercial real estate. The average investor, they can see the tax benefits, the wealth creation, the income creation of commercial real estate, but they don't know who to trust or how to get in. So, we made it accessible by pulling together a fund of different asset types, different geographies, different operators. allowing people to invest one time, let's say $50,000 or $100,000 for accredited investors. They give it to us and we spread it over like 78 assets in our last fund that we just finished recently. And so, the goal is for us is to find intrinsic value in an asset. Michelangelo, the greatest sculptor ever, said he could see a piece of granite. Everybody could see it, but he could see a sculpture already in place. He just needed to chip away. The superfluous material. And so I see that a great operator in self-storage or mobile home parks, they can see the intrinsic value and they need to chip away all the stuff that is keeping it from coming out. So self-storage, mobile home parks, the reason I love these in particular is they have a lot of mom-and-pop owners. I mean, mobile home parks, there's about 44,000 in the US, about 85 or 90% are owned by mom-and-pop operators.

Wow.

They don't have the desire, the resources, or the knowledge to improve the income and maximize the corresponding value. Hey, they don't need to. Cap rates on these things have already gone down from 10% or 11% or 12% down to about 6%. And so, they've already doubled the value just by the popularity of the asset class. They're already going to be selling for millions more than they ever planned to. But if you buy one of these assets, you can go in and do things that the mom-and-pop would never know or care to do to increase income, to increase the value, and potentially double or even triple the investor's equity in a couple years. And so that's true for self-storage as well. Mobile home parks are the only asset type that have a decreasing supply And an increasing demand every year. And so there's just a lot—

Decreasing on it.

Yeah. So, uh, the number of mobile home parks being built in the US every year is estimated to be 10 or 20 in the whole US, and they're generally in rural areas or places, you know, most people wouldn't want to be anyway, or most people wouldn't want to invest. But there's about 100 to 150 being destroyed or torn down or vacated every year, and there's lots of reasons for that. So, there's a decreasing supply, but there is an affordability crisis in the US. You know, 10,000 people a day turn 65, but 6 out of those— 6 out of every 10 don't have $10,000 saved for retirement. But a lot of them have some home equity and they can buy a mobile home and live in a mobile home park and actually have a better life than they would have in their house. And so, that's And that's one of the reasons that mobile home parks are just, they're coming into their own as a great asset type. They're probably where self-storage was 10 years ago and where apartments were 20 or 30 years ago. And so, there's a lot of potential upside there.

I love it. Yeah. I've heard a number of funds and just people talk about mobile. I've never done a mobile home park or even self-storage, but I've heard just great things. And especially RV parks, mobile home parks. Um, there's just so much, so much meat on the bone. So congrats. And is that your thesis for your other 3 funds? Is this 4th fund unique just to that?

No, the last 3 funds have had self-storage and mobile home parks. They had a potential of having apartments, but we haven't found apartments that we found anywhere near that much intrinsic value on them. I could run you through an example or 2 if you want, but, uh, we just see so much potential value. Self-storage, there's 53,000 There's about 100,000 self-storage facilities in the US. That's the same as Subway, McDonald's, Starbucks combined. Yet about half of those are owned by mom and pops. And again, they don't have the desire, knowledge, or money to, you know, to really maximize value on these things.

Makes sense. And as far as the— so now we're in— this is Investment Fund Secrets podcast. We talk about funds and fund managers a lot. So in your fund, what's— what is your role end up being? Are you the one going out and walking properties and making deals happen? finding investors? Are you the one helping manage the internal workings of the fund? Or anyway, I'm curious, what's your role inside of the, inside of the fund?

Yeah, so Perry Marshall wrote a book called 80/20 Sales and Marketing. You know, the 80/20 principle says that 80% of the, the, you know, stuff is— 80% of the rain is made by 20% of the players. Well, that's also fractal, which means that like 80% of 80%, 64% of the good stuff is done by 20% of 20%, or 4% of So, our goal was to actually find the very best, say, 4% of the operators that are doing the very best deals in self-storage and mobile home parks. They're buying from mom-and-pops. They have a great acquisition pipeline and to partner with them by investing with them. So, again, studying Warren Buffett, Buffett obviously doesn't choose ice cream flavors. He doesn't write insurance policies. He doesn't build mobile homes. But he is the largest player or one of the largest players in every one of those areas and a whole lot more. He does that by partnering with great management teams who do great deals. And that's our thesis as well.

Gotcha. Okay. So, you'll find great operators and do that as well. And is that your job then is to go out and find those operators or you personally inside your team, you know, is, is, or is your role more capital raising or just, I know you do a lot of marketing, you're on, you're on shows and all What is your role specifically?

Yeah, my role specifically is to be the visionary. I came up with a lot of these ideas, uh, to actually connect with investors, to create content. I do a lot of blogging, uh, videos, webinars, etc. And then our team does the operations, the mechanics, and we got another guy on the team that specifically is out there sourcing operators, though a lot of those So, you know, are sourced through me and I just hand him the lead and he goes out and does a lot of the due diligence.

Gotcha. Makes sense. Well, really cool. Well, congrats on the 4th fund being launched. That's an impressive feat to get past. Just even to get one is a big feat, and let alone have 4 that are running. So, congrats to you, Paul, on that. I want to switch gears a little bit and ask you, you know, I know we've got a few minutes left on here and it's already been fun talking with you. Your thoughts on, and we'll go a little more broad here, on someone who wanted to get into the fund space. What are some advice, and maybe not even the fund space, but financial space and becoming an investor? If someone's listening to the show, let's step back a little bit. First-time investor, they're a little bit nervous, right?

Mm-hmm.

The first property you buy, the first investment you ever make, it's just this, you have a little pit in your stomach, right? Of like, ah, should I do it? When's the perfect time? Should I get in? Should I not? What are some thoughts you have for someone who's a first-time investor? We have 44 million first-time investors this— 44 million new people on the public markets trading, which is just insane. Thoughts and advice you would give to people that are just getting in, or maybe they've just started in this investing space and are looking for some help?

Yeah. Warren Buffett said, the best investors say no a lot. The very best investors say no almost every time. And so, and that corresponds to something that Donald Trump said way back in the '80s. I remember reading this when I was in grad school. He said, don't fall in love with any property. And so, it's so easy to get emotionally entangled. It's so easy to ignore warning signs, ignore gut feel. You know, there's so many things we can do because we emotion— you know, our emotions are tied in and we want something so bad. So, that's why I think it's really important to get a team, get a mentor, get a paid or unpaid coach to really guide you and listen to them. Listen to your gut. Listen to your spouse. For goodness' sake, guys, our wives know a lot of things, you know, or significant others know a lot of things that we don't know, even if they don't understand the mechanics of the business. And so, that would be my main advice would be to find a coach. Find a mentor or to invest with somebody whose interests are aligned with yours, who's got skin in the game, and they're going to profit when you profit, and they've got a whole lot more experience than you. And like I said, don't follow your emotions. When you get so entangled that you don't want to hear something bad about some operator, you hear something bad and you're ignoring it because you're rushing to invest. That's a really bad sign.

I love it. Good investors. Yeah. Say no almost all. I love that all the time. Thoughts on finding a good mentor? What's some ways maybe, I know you've probably been contacted by a gajillion young people. Hey Paul, can you be my mentor? What are, you know, what are the ones that stick and actually like, you're like, actually, I actually do want to help that person or work with that person.

Yeah.

I think there's an art to finding a mentor. Yes, you can pay for coaches. People have programs and stuff like that. But to actually find a good mentor, I think, is an art in itself. Any thoughts there?

Yeah, you can definitely pay a coach. And I've had 3 of the most successful things I've ever done in my life was when I paid an expensive coach. So, don't be afraid to do that. But if you want to look for a mentor, what you're going to want to do is go buy them coffee or take them to lunch at a nice restaurant, you pay. And you don't go and say, I want to learn everything I can from you. But you go say, look, I really respect and admire you. What can I do to serve you? What do you need done? I'm willing to help you out at— and I'm not asking for any money. I would just like to learn from you, but I would like to serve you and help you. And if you actually do that and follow through, I mean, really follow through, you'll be 1 in 100 that actually follow through. And then you'll really impress them. And in a short time, they'll be giving you more and more responsibilities, more tasks to do, and they will feel compelled most likely to pay you or even potentially partner with you on a deal at some point. And I've seen that happen a number of times. It's been really powerful.

That's spot on. So, come in, how can I help? How can I serve you? And then, actually doing it, right? Actually following up. And you'll— it's this, I guess, the law of reciprocity, right? When you give to somebody, they usually want to reciprocate that and maybe bring you on. And they'll— it's a good test period and testing out. I absolutely love that. Actually, an early mentor I worked with in real estate is that exact same way. And somebody told me, just go. Just don't worry about getting paid. Don't worry about— just go and help him out. Just help in whatever you can on social media or his website or just random stuff, not even related to real estate. Just help him out.

Right.

And so, I did that with one gentleman and he We were still very good friends and actually might be starting a business together here pretty soon, um, you know, years down the road. And he taught me a ton about real estate, helped me get going. We, we wholesaled 2 properties together and kind of got my feet under me, got me okay looking at deals and how to think about them. It was, uh, because I knew how to build websites. I built him websites and, uh, built out his social media. And because he's like, I don't know this internet thing, can you help me? I was like, yeah, I can figure it out. And I was on Google looking stuff up. And anyways, I love that advice, Paul. That's, that's That's spot on. Now, for people that are more seasoned thinking about getting into the fund game, right? You're on your 4th fund here. Any advice for people? We talk about this a lot on our show, starting funds. I go through the mechanics of finding investors, finding deals, finding partners, putting it together, how to structure it, your SEC filings compliance, we talk about that a lot. Any thoughts from you though on someone that's interested in starting a fund? Done a number of deals, they want to get in, they feel like they have the confidence. Any thoughts or advice from you on that aspect?

Yeah. My advice would be make sure you get the right attorneys, get the right CPA, pay the money to do it right. It's so easy to jump in and we start our first fund and we had a syndication attorney, a real estate syndication, somebody who takes money from investors and they're the operator, asset manager, sponsor, whatever you call it. And they're doing a deal and then they get a cut of the deal after the investors get paid first. Well, syndication attorneys are basing their work on the 1933 and 1934 Securities and Exchange laws that were passed. And they know what they're doing in the 1930s acts, so to speak. But there's also the 1940s acts, you know, the different rules that were passed for securities and funds. in the 1940s. The attorneys that play in that space are completely different from the attorneys that play in the 1930s space. And if you want to do a fund, you're going to want to be in the 1940s attorneys. They're often more expensive. They're often way more knowledgeable about securities and securities law. That was the biggest lesson we learned because we wanted to go with our syndication attorney that we'd already known that had done a number of syndications. But our CPA firm said, You really need a fund law firm that specializes in that. So, that's my biggest first advice if you want to start this. And then, I've got some thoughts about raising capital as well if you want to chat about that. Yeah.

Let's get into raising capital. So, find a good attorney. Yeah. Make sure you're set up properly. You've got a good team because you're taking investor money. It's a big deal, right? You don't want to do something wrong. You want to make sure it's done right, it's done correctly. Talk us through, yeah, raising capital, especially maybe on a first or second-time fund. Thoughts there on raising capital?

Yeah, so I mean, it wouldn't necessarily be— this could be for a fund, an individual deal, a syndication, whatever. Uh, this, uh, there's this great story. It's a little silly analogy, sort of, but if you live up north and you love salmon, you want to live on salmon, you can become a spearfisherman. You'll have to learn to carve, you know, the limb. You'll have to learn to throw it. You'll have to hope that a salmon swims by in a dark stream. Hope that you can spear it, hope you can get it to shore, and you might have salmon for dinner. But hope is not a good business strategy, right? So, another way to do it, and this is where the analogy gets really silly, you could become a grizzly bear with your jaw unhinged, standing in the waterfall, letting salmon practically leap into your mouth. And that's a strategy to get really, you know, really get a lot of great investors. Well, how do you do that? You do that by becoming a content provider, by becoming someone who creates and provides real value to people, putting it out there like you're doing on this wonderful podcast. And, you know, write a book, write ebooks, get great social media, put out great tweets, have your own podcast, be a guest on podcasts. Just create educational content that helps people. And then don't even ask them about money. They'll come to you and ask if they can invest with you because they already trust you.

That's spot on. That's actually, to echo and just back up your point, one of the best advices I ever got was start a podcast, start a show.

Yeah.

And don't— and mine wasn't an interview show. We interview, by the way, about every 5 to 10 episodes, we interview someone. We do a lot of other content there as well. And at the beginning, I had a mentor. We paid, again, I paid him good money to be a coach and a mentor. I think it was $15,000 I paid this guy to help us with all online stuff. And I would gulp. I was in, you know, kind of in debt. We put it on a credit card. I had to make the money back. We had to figure this thing out. And he said, start a show. And everyone goes, yeah, I can start. But no, start a show and get 30 episodes under your belt as quickly as possible. Because he goes, number one, no one's going to listen to your 30 episodes anyways. It's for you. It's for you to be able to find your voice and be comfortable on camera and talking and figure out what things resonate. And then if you want to, you can go back and delete all those 30 episodes and then just start again, right? Or start a new show, but at least get to 30 episodes. And so I said, you know what? I'm gonna take him up on that. And he kept just hounding us. He's like, when do you start your show? Are you publishing yet? When are you gonna publish? Go live on Instagram. Start telling your story. Tell people what you're doing. And it was just, it was a big gulp to get into it for us. And finally, I just said, I'm gonna bite the bullet. And get in. And we started, and, um, this show by itself has bloomed into incredible relationships with investors, with, uh, we have a bunch of programs and now we coach people and we have a coaching program. We have over 3,000 students right now in our programs.

Wow.

And it's just been incredible, all based really from this show was the first thing we started. It all kind of trickled from this. And I've told a number of people that, um, and especially, you know, people like Paul, just for people listening, there's no way ever return a phone call from me. Right? Except for I have a show. And so Paul, he'll come on. Right? And if you want to meet people that are above your pay grade a little bit and people that run 4 funds and incredible people like Paul that have done, you know, been all over the place, and this is me just giving out my, and you know the same thing, Bo, start a show though. And people love to be on shows. And especially if you have a number of episodes and a decent following like we do, it brings on incredible people like Paul.

Right.

Paul, how did you start your shows? How'd you get into the publishing space? Um, as well, I'd love to hear that story.

Well, I had a mentor that I paid $25,000 to, and they were trying to coach us. They coached us on everything in the real estate realm. It was a long time ago. And I was just, I had decided, Bridger, that I was going to work with 2 or 3 big investors who were gonna fund all of our deals. And our mentor kept saying, it's not gonna work. You're gonna need to start a show. You need to get out there. He didn't say start a show, actually. He said, go out and publish stuff, start doing speaking engagements. This was back in the day before podcasts were anywhere near as popular. And I kept resisting him. And after about 2 deals went bad because I didn't have investors, on a phone call with other people on the call, this is my mentor here who I had a lifetime subscription to call him, right? On this conference call with one of my young employees and my business partner, he's like, listen, You don't listen to me. So, don't call me back. Don't get on my schedule ever again until you do what I've been telling you to do for 2 years. Ouch. And that was the day I decided, man, I've got to get involved. I've got to start a show. I've got to finish my book. I've got to do this ebook, et cetera. And so, all of that bloomed from that moment. And we went from having like 5 potential investors to having, you know, many, many hundreds of actual investors.

Wow. That's how— what year? How long ago was that?

That was— I started that mentoring program in 2014. We'd already done 2 multifamily deals, didn't know what we were doing, didn't even know what a rent roll was. I thought it was just a list of people who, you know, lived in the apartments. And so, uh, decided to go back and get mentored in 2014 to really learn it. So not that long ago.

Yeah. Oh, that's amazing. And yeah, and look at, you know, I mean, you've launched a number of shows, you have books and shows, and just, and it's been incredible to see what you've done there. So, Paul, walk me through though on your show specifically, is that for, would you recommend that to everybody? Anyone that wants to raise capital, get a show, start publishing, or is it a certain personality type or is it only for certain people that can do things? What's your advice? Should everyone do it or should just certain people do it? What are your thoughts?

I got a crazy story for you. So, I was actually on a mission trip to Haiti in 2013 or '14. I was riding alongside this guy that I knew. I play bass and he actually played drums and we played together a few times. And he was telling me for the first time how he had joined some really famous guru programs. I won't name them, but they're— I mean, everybody knows who these gurus are. And he said he had just spent a ton of money going to their weekend and week-long events and it was just a waste. And he was so depressed. He was actually working a full-time job, adopting 1 or 2 orphans, and training horses all evening. But he wanted to be a real estate investor, so he piddled around for years, and after that for many more years. And he actually joined a coaching program that currently costs $50,000 just to get in. It was much less at the time. This was 3 years ago last month. And he joined this, and after about 5 months, the coach said, you've got to start a show, but not just any show, you need to start a daily show. Well, when I heard that, I thought, no way. He's got this job, he's got kids, he's doing all this stuff, and his personality is super quiet. He's very meek, mild-mannered, quiet, thoughtful. You know, he's just not kind of an out-there guy like I am. And I just thought it was gonna be really hard. Well, he's never missed a day. Now, if he needs to, like he was telling me over coffee a few weeks ago, he said, if I need to raise, like he said, I think he raised $7 or $8 million on his latest deal. He literally put the word out, had the money raised in 3 hours, and had double that much money on a waiting list within 24 hours. So, basically, this guy, from having a show, Daily Show, He can snap his fingers and raise as much money as he wants. I mean, it's called The Real Estate Syndication Show. Whitney Sewell, great guy. He quit his job and he's obviously, I mean, he's just doing extremely well now. He's got like 5 apartment deals under his belt, including I think one in Utah.

Wow. That's awesome. So, that proves right there. I love that story too. You don't need to have this whatever, whatever it is, XYZ personality or topic or whatever, you can get started, get into it. I think that's excellent advice, Paul. Okay, we got it. We got a couple minutes left here. I want to do some quick hit questions and just hear your thoughts. Um, and we, we mentioned this earlier, um, for, for someone, you know, that's, that's, I don't know, you, you've had an extensive career in entrepreneurship. Um, you've done a lot of your own businesses. Thoughts on, you know, people that are struggling with being an entrepreneur, any thoughts there that they have the fear, they have a lot of fear to just start a business or get into this game at all, right? Thoughts there too that helped you overcome the fear of it all?

Well, I'm probably not the right person to answer this because I quit Ford Motor Company with all the benefits and the career track and everything with my wife 7 months pregnant with our first baby. And actually looking back on it, 97% 7% of the revenue when I quit was from one client who was unstable, and they actually did stop paying us 13 months later. But my point is I had a risk tolerance that was kind of crazy that I don't know if I would do that again now. I think I'd have been a lot more careful. As far as your question, I mean, I think everybody just is going to say the same thing. You just got to get out there and do it. But make sure your gut and your mind and everything else is aligned. If you feel a lot of fear and resistance, maybe it's a sign that you're not really supposed to do this and you're supposed to do something different. On our How to Lose Money show, we learn from people that quit, you know, people who quit too soon and should have persisted. Others went on way too long with the wrong thing and they should have quit sooner. So, that's some things we've learned.

Huh, interesting. So follow, follow the omens. So you're saying a little bit, a little— yeah, if you, if you read The Alchemist, right, it talks about that. Thoughts on cryptocurrency?

You know, I really was— I kind of made fun of it. In fact, in December 2017, when it was about $18,000 or $19,000, I wrote an article about why real estate's so much better. And 3 days later, it crashed and eventually went down to $3,000. But now I actually— that I've studied it more, I actually believe it's a good hedge. against currency inflation. And I bought some myself. My business partner's buying some. And I really do believe that the right cryptocurrency, and of course, I'm thinking of Bitcoin right now and Ethereum, I think they're actually— I don't think they're safe. I don't think they're stable. I do think they're a speculation. I don't think they're really an investment, but a speculation. At the same time, I have some, and I do recommend that people get some.

I like it. I like it a lot. Uh, and on that, I just want to follow up on, uh, you know, hedge against the US dollar. Thoughts on the future of the US dollar? Do you think— do you— when can this money printing— and this is probably a bigger conversation, but, uh, it's a big topic— when— to what end, right? To what end can we keep doing this, uh, where a country will say, I'm not gonna accept this dollar anymore? Do you think we're— I think we got still a lot of room there where we're pushing the limits? What are your thoughts?

I don't know, man. I think that with right now with China playing the role that they are and having the power over us over that they do. I hope we're not going to end up— Jason Hartman, I think he was on your show, he showed you the $10 trillion bills from Zimbabwe. I got some too here. I got some from Zimbabwe here and Venezuela, and I'm getting a little nervous about that. And if we end up not being the world's reserve currency at some point for some reason, I think we could be in a load of trouble there.

Interesting. Last question I want to ask. I love asking this to all of our guests. I'm just going to open the mic. You got 2 minutes. I want you to share what you would feel like is most valuable to leave with this audience. Now, you can talk religion, politics, God, money, real estate, entrepreneurship, whatever. You've got 2 minutes. I'm not going to interrupt you. What are maybe 1 or 2 things that you would feel like are most valuable to you? that have helped you the most? Just what— and I'm not, I'm not even going to phrase it that way. Just whatever you'd like to share. You got 2 minutes. What you think would be most valuable to leave this audience with, then we'll close up. So everyone, I give you Paul Moore. Here we go.

Okay. So first of all, I want to talk about investing versus speculating. I touched on this with Bitcoin a minute ago. Investing is when your principal is generally safe and you've got a chance to make a return. Speculating is when your principal is not at all safe. And you've got a chance to make a return. And the problem is people confuse the two. When we confuse the two, you can be like I was when I was 33 with a couple million dollars and blow it. And you can make lots of mistakes. And when I threw money down an oil well in North Dakota, expecting 100 times as much back, I got zero back. That was a speculation. Well, It goes along with this corollary that real estate or good investing should be boring. Warren Buffett's life's incredibly boring. If you look at his life over the last 60, 70 years, he lives a very, very boring life. And Paul Samuelson was the first economist to win the Nobel Peace Prize from the US. And he said, true investing should be boring. He said, investing should be like watching paint dry. or watching grass grow. If you want excitement, take $800 and go to Las Vegas. And so that's my first thought. The second thought is, if the pandemic has taught us anything, it should have taught us that people matter. Our families, our friends, our relationships, our coworkers, our boss, our subordinates, they matter a lot. And the true joy in life— I mean, when I woke up as a 33-year-old with a couple million dollars in the bank in October of 1997, I wasn't any happier than I was the day before. But when I listened to my daughter pour out her heart to me about some pain she was in, and when I actually was able to help her and love her, I got a lot more joy out of that than the million dollars. And I'm telling you, like you said earlier, Bridger, if you're not doing it now when you're struggling, when you're, let's say you're poor or you're just getting started out, you need— whoever you are is who you are today. Whatever you're going to be in public is who you are in secret right now. So, take those steps, make that time, don't live for work, and you can find a lot more joy in relationships. I think we were put on the earth to love people and to serve people, and we'll get our joy from that, even if that love is not returned.

Wow. Good advice, Paul. I love it. I want to thank you for coming on the show today. Uh, it's been a pleasure. We'll probably have to follow up with you in maybe 6 months or a year from now and see how the fund's doing and, and how everything plays out. Paul, thank you again. What are, what are good ways people can find you, reach out if they want to hear more? Where can they go? Where is your show at? All those types of things. How can people get in touch with you?

Yeah, I spent the first 11 years in real estate investing, you know, doing flips and lots and houses and stuff, and didn't know how to get into commercial. So we created a course People can get from going to wellingscapital.com/resources. It's a free course. You can learn how to invest in commercial real estate. Self-storage, mobile home parks are in there as well. So, that's Wellings, W-E-L-L-I-N-G-S, capital.com/resources.

Gotcha. Wellingscapital.com/resources. You got your course on there about real estate, all that kind of stuff. That's great. And then your show, never— sorry, How to Lose Money, correct?

Yeah. How to Lose Money is available.

How to Lose Money is the show, okay.

238 episodes out there on iTunes and anywhere you can find podcasts, we got it.

Okay. I love it. Paul, thank you again so much. We'll have this episode out to you soon, hopefully. And thank you again for coming on the show.

Thanks, Bridger. It's been great to be here. It's a real honor.