From Drop Out to $50 Million in Real Estate Deals: Investing in Yourself with Dylan Marma

Welcome to the Next Level Income show where it's our goal to take your income, investments and your life to the next level. Chris I'm your host Chris Larsen. Get your free copy of our book@nextlevelincome.com book today's show is sponsored by Money Insights and their investment optimizer strategy. In my book, I share how I use this strategy to invest my money in two places at one time. This strategy has been used by the wealthy for generations for estate planning, minimizing taxes, preserving wealth and increasing stability for their investments. Money Insights can help you develop a plan to build an emergency fund, pay for college, fund a business plan for retirement, and optimize your investments. Find more information by checking out NextLevelIncome.com and clicking on the banking link. On today's show we have Dylan Marma. Dylan Marma is a principal of the Requity Group, a multifamily real estate company. He has five years of real estate experience participating in $50 million in real estate deals as a general partner or joint venture. He's worn many hats in the business including acquisitions, investor relations, asset management, business development. With a passion for scaling businesses and helping facilitate great deals. He co founded equity tree in 2020 to provide a platform backed by software solution for investors to become better operators. Dylan, welcome to the show.

Thanks so much Chris. Excited to be here.

Yeah man, we met during podmax a couple months ago. So for the audience, for some that are listening for the first time that don't know your background, give us a little more detail on how you ended up where you are today.

Well, I definitely didn't go out and buy 50 million in real estate all on my own. It's something I take a step back to when I started in real estate investing. I got started 26 years old. Now at 21 years old I bought my first single family property. I took a leap of faith moving from New York, buying the one way ticket out to California with the goal of creating a lifestyle by design as they call it. And I started to reaching out to people and throwing the intention out there that I wanted to get involved with real estate in some form or fashion and ended up getting a job working for a real estate investment education company. And there I was surrounded by a lot of good mentors that really opened up my eyes to the different facets of real estate investing. And like many, I started off with a single family property and from there I bought a duplex. And as I continued to learn I realized that if I were to work a W2 and continue to buy one property at a time. There was something about that path that for me just didn't quite align with my own value system. In a sense, I think it was just too certain of a path. And it almost bored me to think about if everything goes right where I would be in 10 years following that road. So I sought out to find a way to scale and to get into bigger investments and to entertain the entrepreneurial part of me. And multifamily syndication was the answer to that. So I was able to invest into myself heavily into education and into mentors and learn the space inside and out. And after enough of that, I eventually felt confident enough to leave my W2. And when I was really didn't have all that much experience, but I had the cash and I was working 70 hours a week. So I found it really difficult to make the progress that I needed to because I was on the other side of the country from the deals that I was looking at. So I said, now I have some cash saved up, I'll be able to free up my time. I moved out to Atlanta a few years back with the intention to get into a multifamily. I bought a 21 unit that was a joint venture with a few partners. And then from there I got into syndication, which is really the art of finding big deals and pulling together investor capital to purchase those deals, providing them with great returns that are truly the most passive form of real estate investing. And us as the operators to put in this sweat equity in exchange for a small share of the profits on the other end of it. Starting off with the syndication space, start off with 132 units with a few partners. And one deal led to the next, led to the next. And now at this point done about 750 doors, about 500 of that being syndicated and 250 being joint ventured. And now at this point as a few months back, I recently started a new brand as I split off from a former partnership. So going through that and as I continue to grow, I'm looking at multifamily and also mobile home parks.

You know what, that was phenomenal. And what I love, you know, we both got our start around age 21. I just love having people like you on the show, Dylan. You're such an inspiration. Short period of time. I talk to people, I say if you have a plan, anybody can achieve financial independence in seven years with the right plan. And you're living proof here by the age of 26, right, that you've come out of the doors and done it. And I love your two goals, to create a world class real estate investment company and to reform modern day education. And that aligns really closely with next level income which we talk about helping investors achieve financial independence through education and opportunities. Can you please share with the audience how you came to those guiding principles and how that works in your day to day experiences.

So number one, creating a world class organization is something that really just gets me excited more than anything. I find I'm a system builder. If I could really define myself and what I really gravitate towards, it's building stuff. When I think about creating an organization, I think about building the infrastructure that the organization operates off. One of my biggest virtual mentors, we'll call him is Ray Dalio and he talks a lot about creating an idea of meritocracy. And his book principles is basically the blueprint of on how to build a winning culture within an organization. And I think for me long term I would love to build a company that operates like a real estate private equity company where I have great people around me that are extremely smart and challenge each other's ideas and create that idea meritocracy environment as I think that's just the type of culture and world that I'd like to live in and I would love to be a part of building the infrastructure that makes it all tick and makes it all work. So that is goal number one. Goal number two pertaining to reforming modern day education. I think when you look at a lot of today's problems in our society, a lot of it stems from the very bottom which is education, right? And there's a disincentive in terms of the incentives are not aligned when you look at today's authorities and political leaders because they're really focused on getting the maximum results out of four years. And investing back into education is not something that is going to reap rewards over a four year time period. It's something that takes many decades to see come to fruition. So I think that it's going to take external forces from people that are sharing the mission to reform modern education and investing reinvesting resources into modern day education. And that can be through the format of just investing funds back in the schooling systems, getting teachers paid more. They could be getting resources in the schooling systems that could also be through alternative ways of schooling and just changing. You know, I think there's a lot of the current way the current system for teaching is outdated and needs reform when it comes to, you know, financial education or thinking like an entrepreneur or, you know, prepping people as we continue on the age of the information age. So I think doing that in some capacity would definitely be something that really motivates me. And my mom was a teacher. I have several teachers in my family. So I think that's why it's probably. It's close to home and you're getting.

Me fired up, dude. So my mom was a teacher as well. I had a lot of frustrations with the education system when I was younger. We're actually launching a new venture here locally in Asheville with another nonprofit to help teach financial literacy to those that just don't have good backgrounds in that. So I think you and I are going to talk more about that. This is a little bit of a tangent here. We talked a little bit about some stuff before the show. So going off on a total tangent, I think that higher education is heading down the same path that housing was. If you look back 15 years, we've seen 6, 7, 8, 9, 10% increases in cost of education over the past decades. And you're 15 years or so behind me. You know what cost me $25,000 for a four year education is now costing students $25,000 per year. And my children are on track. And I just wrote a blog article about this. It's going to be published by the time this talk this goes out. The estimated cost for a four year education for my children in the next 10 years is going to be $200,000.

Wow.

And you have to ask yourself, for somebody like you, Dylan, I want to get your perspective on this. So I'm looking at this and thinking, okay, first off, how much do I need to save to give each of my children $200,000? And two, is it even worth the money? Because if I can take that $200,000 and invest it, is it going to achieve a payoff? What do you think about that? I think we're kind of talking about a very broad scope, but as far as higher education, I love this topic.

So for me, I'm actually a college dropout. So I actually was doing that math two years into school and I ended up leaving because I was taking on an enormous amount of student debt and I couldn't really connect the dots. I was looking at the average salary, I was going to school for accounting and looking at the average salary and thinking about how much time it's going to take for me to be able to pay that back. And then I got this entrepreneurial kick. So it was a combination of the entrepreneurial kick, a little bit of naive, admittedly, and also just doing the math in terms of the ROI from a logical standpoint. Good for you. That pushed me at that time to leave school, so. And I don't really fully regret it, although I will admit that I think I'm an exception in a lot of ways as to, you know, I had the ambition and the drive to do what it takes to make it without school. I do think that the way our current society set up, a lot of entry level jobs do require you to have that degree and it makes it very difficult, especially if you're not say, an extrovert. Right. I think there's more opportunities for extroverts and I'm not always super extroverted, but I'm willing to work with people. I think for the people that are, you know, say more introverted, need technical skills, school's the most viable path because that's going to get you into some kind of a space that can lead the next things. But not to go too deep on.

That, go for it, man.

I think that the ROI is continuously harder and harder to justify. I think it's really important that people know why they're doing it. I mean, at 18 years old, how many of us really knew what we wanted to do long term, right? We jump into it and you have all of your family around you pushing you to just get the piece of paper they know. It's not really, doesn't really matter what you're getting it for. It's just a matter of getting it so that you can have it and go and get your first job. And I think that as we see jobs are going to become more and more scarce and more and more specified to very technical, specialized education. So I think that it has to change, right? It's. There's going to be a breaking point definitely to where there's always going to be value in investing into education. But I imagine that you're going to have much more specialized platforms to learn a specific skill set, be it learning how to code, which I think is going to become more and more important, or you know, learning a trade or something to that effect, I think is going to become more and more important.

Yeah, I mean, what's amazing, I had a. Oh, can you see it here? There's my. So I had a discussion about five years ago and younger gentleman at that time, he was probably about your age and we're talking about the inequities of education and how everybody deserves an education. And I held up my cell phone. I said, everybody's got an. You can have an education. What are you talking about? I held my cell phone. It says right here in your hand. So it really kind of caused me to think a lot. It's like, well, how am I going to teach my children this? And what we decided upon, my wife and I was, one, we're going to give our children the resources to go to school. Two, we're going to teach them. You nailed it. I love it. Two, we're going to teach them how to calculate the roi. And then three, they need to understand the opportunity cost. And if they can understand those three things or if they can have those three components and they still decide that's the best choice, then I'm going to feel good about that. But we want them to have skin in the game too. So do you have any active initiatives that you're currently doing to actively change education at this time?

At this time? Not really. The most I do in terms of helping other people is usually in the world of real estate. I do a lot of mentoring and working with other people and helping some younger people get into the space as best as I can, in my view, is almost a little bit of my idealistic long term view as far as the area that I'd like to make an impact in. But for the time being, most of my time is consumed with real estate investing. And then hopefully I'll find a way to tie that in the next decade.

You know what, we'll work on that together. So, college dropout. How many units was it? I apologize. 750 units. Age 26. It sounds like a dream. Tell me about some challenges that you faced along the way. For the audience that's saying this is too good to be true.

Well, it's definitely psychologically tolling to go through and take some of the risks that I've taken in the last six years. And I think that you have to have a certain level of pain or risk tolerance to make these decisions and hopefully end up on the other side successfully. Right. For me, I think I can go back to the beginning, right. Leaving school, lot of pushback, a lot of adversity. I was president of a fraternity. I had a lot of friends, great people around me that wanted me to stay in. I had a family, loving family that wanted me to stay in. They thought it was best for me. A lot of pushback there. So that was a tough time to push through against the grain in that sense. And then from that time, eventually leaving the W2 job again, leaving kind of a security blanket to. I was making pretty good income. I was in a leadership role and doing well there. But, you know, again, I knew that for me, you know, it was not the path that I wanted to follow long term and I wanted to take, Especially being at a young age, I realized that I wanted to take the risk now to get into something entrepreneurial. I had the ability to. But I remember walking around every single day when I first got to Atlanta, literally just giving myself affirmations that I'm going to make it. I'm going to be, you know, an owner of 500 units. I'm going to find this next big deal. Right. I felt like as soon as I got out there, it was one of the hottest markets we'd ever faced. And I was kind of second guessing myself constantly of, is there still deals out here? Is it still possible? Is it really going to work? And that took a lot of just resilience to continue to convince myself that I was making the right decision. And eventually one popped. But it took over a year of really searching before the momentum started. And then even from there, I mean, you have the trials of not every deal is perfect. I know on podcasts, everyone likes to talk about the fairy tale deals that they do, but there's definitely all kinds of challenges that happen. You occupancy decreases, you have all kinds of tenant issues, you have things that you don't dig up during due diligence, you miss, and you have to learn from that later. Right? So there's all kinds of definitely, it's definitely a roller coaster, in a sense. And it's definitely been very consuming of my time and mental energy in terms of the, you know, the amount of input I've given towards real estate to get here.

Yeah, man. Well, it is a marathon. So anybody that's listening, a lot of people, they. They get started and they stumble. They don't get through that first year that you got through. Same thing it took my partner and I, you know, we started our partnership in 2015. We syndicated our first deal in August of 2016, and it was about a year that it went down there. And you're. It's. You feel like you're just literally banging your head against the wall as you do that. You talked about investing in your education. Can you talk about the importance of that component to get you to that first big success?

Yeah. So I'm a big believer in investing into education, be it in the form of mentorship, be it in the form of your online courses. I'm also A pretty avid reader. So time, energy, money, investing everything early into education. I think especially when you're younger, and that doesn't have to be age. That can be just in your career. I think any money that you have, if you have, say, only $50,000 to your name, you should not be focused on spending 50 grand on a single family rental property. Because that $300 a month, I promise you, is not save your life or make life that much better. Right. What's going to change the quality of your life is the investment that you make back into yourself to figure out how you can increase your income or create a business. Right. Whatever that might be. I really think that it stems down to finding a way to first make sufficient enough income, be it through a business or advancing further in your career. And the best way to do that is to invest into an education. I started off with a leadership coach from the John C. Maxwell organization, and that was super helpful for me growing in my career to get to a management position. And along the way, I invested into public speaking training. I did Toastmasters. I was constantly reading. And then when I got into multifamily, I invested into a mentor very closely with Vinny Chopra in that time. I didn't even know if he was doing a lot of mentorship at that time because he wasn't as widely open. But I said, hey, I'd love to learn from you. Let's do something together and invest it into his mentorship. And I spend funny stories I had to spend. It was like 6,500 bucks to go visit Grant Cardone. Must have been three years ago, because I was a fan of his mindset and his outlook on investing. And I basically said, hey, listen, I'm considering making this decision to go all in on multifamily. Is it really worth my time? I sat down with him, and I sat down with one other guy who was a mentor to me, another guy who was worth 100 million at the time. I had to hear it from people that were further down the road than I was to make me realize I wasn't crazy to take this leap and just to invest all my time into the vehicle. And after conversation with them and the conversation with the others that I had, I really was able to say, okay, let's go all in. Let's not hold anything back.

I love it, man. Yeah, I still listen to Grant when I need a little bit, need to get fired up a little bit. I went to his event about 18 months ago now, and it's amazing what he's built. It really is. He's a little rah rah for me. But again, like if I'm like oh like this is a grind, I'll fire up one of his books and you don't even need. I listen to stuff at one and a half speed. I don't have to with him. I listen to it a regular speed.

Early on. Yeah, I don't go through quite as much anymore but every now and then I'll revisit it. But yeah, early on, you know, the 10x or the be obsessed, you know, those were just books that helped. Help. Really?

Yeah, man. So you got a couple different businesses. Tell the audience about Equity Tree and how that came to be and what it is.

So Equity Tree is a software platform that essentially is an investor management system or investor management portal. As for those that are in the business, you're probably familiar with those that aren't. It's basically a portal where principals or sponsorship groups just like what Next level has and what I have. We will invest into a software then gives our passive investors almost like an online banking account, similar to when they log into a Vanguard where they can kind of scroll through and decide which investments they'd like to place offers on and be able to view any of their updates on their performance on their previous deals. This is something that's been neat. It's my first technology venture so it's definitely been quite a learning experience. But I definitely really enjoy especially the product development and the ongoing building out. Something that I think is going to serve a quality purpose for the real estate community. Katerina started the project the vision of helping her joint venture partners. And when I saw what she had been putting together as I'd known her for several years, I said, well this looks like something that could also be open up doors for different people that are in the syndication world. And I was spending 15,000 a year on software at that time and I said, well we need to create something that's much more affordable and we can put it in the hands of all these people that are earlier on or just don't want to getting sick of writing checks that large for this stuff. So that's what we did and we've been been live for several months now and it's been off to off to a great start. We're helping a lot of people through raises as we speak. Using it for myself as well and it's been a really good experience.

That's awesome, man. No, I love it. I've checked it out, we've talked about that. I encourage anybody listening if they're looking for a platform to reach out to Dylan, we'll have all that in the show Notes. So with requity. Dylan, tell us a little bit about your strategy, maybe some of your recent deals that you've been looking at and how Covid has affected the whole process this year.

Yeah, so the big picture strategy is really focused on deals that are relatively simple, that have in place cash flow, that have some kind of a value add component and are quality risk adjusted returns. We're not swinging for the fences on anything that's ultra high risk and we're also not doing anything that's there's no more meat on the bone. In a sense we want to really thrive off active management in the form of active asset management, in some cases active property management in addition to asset management. So that's the big picture as far as what we're looking for on the deals that we're targeting. And we're primarily going to be working with investors so doing deals that are sizable enough to work with a large group of investors. I've been all multifamily up to this point. I'm also taking a strong interest and strong liking making a lot of action in the mobile home park space. I have a few projects I'm working on right now and plan to really continue to grow and hopefully thrive in that space. The reason I thought I was going to be in apartments forever and that that was the only thing I would ever touch. But as life goes on and experiences come up, then we change our views and in this case I just think that multifamily. It's been almost a year since I've done a deal and I really never thought that would happen. I was doing a lot of deals each year and then the markets continued to get more heated up and cap rates have continued to compress and it's hard for me to make sense of a lot of the opportunities out there and I will continue to do multifamily. I'm definitely not being a naysayer and I'm sure there's been plenty of good deals out there in the last year. I just haven't been seeing as many. Kind of got my wet my appetite, so to speak. But I think when it comes to the mobile home park space, I think there's more breathing room as a whole right now in the sense of I think the going in cash flows or especially after the value add, the yield on these is very high. I think when people really understand how these deals work, I would actually go to argue that I think they're actually less risky. Obviously it's a deal by deal basis. There's very risky ones and very risky apartments. But I think as a whole, if you can get into that kind of your bread and butter, which long term is taking a deal, adding value to it and then eventually having a tenant home in a quality complex somewhere in the country, at that point they own the home. There's over a 95% retention rate. You're really just running a ground lease. You can have a really well managed community and you can have very fitting demographics of either workforce, families or retirees that really are going to be happy to live there and pay consistently. I really like the model and I really think that it can offer one of the best risk adjusted returns. And I'm working with an experienced partner. I think it's very important for me, especially working with some of my investors, is that I have experience on my team. My partner's about 50 million on the mobile home side. I've done 50 million on the multifamily side. So together we're able to bring unique perspectives to the table. And that's what I've been very excited about lately.

Awesome, man. I love it. Visit my uncle in Colorado last year and he lives in between Aspen and Glenwood Springs. And we were driving to Aspen one day and we're talking about affordable housing and the crisis in this country and I pointed out the mobile homes. I said that's the solution right there. And I think you're right. I mean you look at different areas in different parts of the country and there are a lot of similarities with mobile homes and multifamily and you know, the aspect of the ownership side is something that is different. And again it's, there's a lot of cool things going on in that space and we need to get creative when it comes to how we're going to make things affordable for people.

Yeah, it's very similar to the C class multifamily, the workforce stuff in the sense of the resident base that you're serving. You're usually just serving different groups that have a little bit different appetites. Some value the homeownership aspects of it, but very similar sort of a mission in terms of being able to solve a problem. And I think there's always a little bit of a stigma that kind of scares people off about it. It's also hard to self manage these or to find a quality third party manager. So I think that also kind of keeps a barrier to entry. But yeah, I think as a whole, the affordability crisis is going to be an ongoing issue. So good to be able to provide the solutions and I think we're always going to be secure in those pockets.

Yeah, man, I love it. You're throwing me a little bit of a challenge today, Dylan. So we always ask our guests, if you can go back to your 25 year old self and give them one piece of advice, what would it be? But I'm going to change it up a little bit for you. So if you could go back, you're still in college, you're 20 years old, I think you were still in College at 20 years old, is that right? You're just about to do that and you're thinking, okay, what do I do here now? You've already been through it. What would you give yourself or what advice would you give yourself back then? At age 20 when you're making this.

Decision, it's difficult to completely put myself back in my old self shoes because I wouldn't be the person I am without taking the journey that I've taken. But if I knew that I was going to go on the same path that I'm going on, I would have not spent time going into other spaces and dabbling with single family or going for mostly a residential company at the time. And I would have really honed in on the vehicle. I think that's where people miss. I think there's a lot of uncertainty at first for anyone getting into real estate. It's what vehicle do I take? Real estate is such a broad field. There are hundreds of different ways you can make a career out of real estate and many of them are all lucrative. There's no wrong answer, but I think you need to choose one and not necessarily go and dabble. Well, you might want to dabble for a little bit and kind of figure out what actually resonates with you. Right. But for me, once I was able to find the vehicle, I was ready to sink my teeth into and stick with, I think the sooner you can do that, the better. So I probably would have told myself back then at the time, admittedly, I probably would have finished up school and been learning massively at the same time because I would have, I knew like at 20 years old it'd be very tough to go and, you know, buy a large apartment building. And I think, like, I would have just been focused on my learning and education, both in school, but also out of school. And I probably would have seen what I could do to find a Mentor that I could work with in the summers and during any downtime to underwrite deals for, to handle due diligence for and find some sort of an apprenticeship that would be serving for me. That way, by the time I'm 23, 24, I have ample experience under my belt and then I'm ready to launch and do it bigger in the future. Right. I probably would have stayed in school, looking back, if I knew this was my vehicle, I knew this was my plan, and then I would have found an apprentice or an apprenticeship of some sort.

I love it. I mean, that's one of the big pieces of advice we always give out, which is find a mentor. Find somebody that's done what you've done, that you can model. And I know a lot of people are sitting here shaking their heads thinking, oh man, the guy's, guy's so young still, he's, still, he's done a phenomenal job. Such an inspiring story, Dylan.

I want to hit on that too. Just because the school, Part two of why I say that, because we were talking about this reform, you know, I think that's because I'm in such a finance driven profession. Right. That's the only reason why I would say for the most part, if I was in, if I was an online marketer, there'd be pointless, right. There'd be no reason for me to stay in school. But the world I'm in is commercial real estate, right. So I've, I've invested into CCIM classes and all these different, you know, real estate finance classes. So I would have stayed in school just to get a lot of the basic finance terminology and understanding down. So that's, it's more specific to the niche that I'm in.

Again, that's great advice and I think that's kind of a nice overlay. Going back to the education side, I'm not anti education. You're not anti education. I mean, far to the contrary, we've talked about how much money we've. I mean, I've invested tens of thousands of dollars in programs and courses and you know, well over six figures. It's about being focused on looking for the ROI and what you're going do. And I think it's such a Challenge if you're 18, it's like, oh, go to college, get an education, get a job. Well, what about having an apprenticeship, figuring out what you want to do and deciding like you've done to be targeted and focused on getting the dollars back for where you've invested those. Well, again, inspiring story. Dylan, I really appreciate you sharing all this with the audience. If people have been listening and they say, oh, I want to learn more about Equity Tree, your platform or you're investing opportunities with requity, what's the best way to get a hold of you?

So you can Visit the website therequitygroup.com that's the equity with an R before it group.com and on there I have a link to Equity Tree which is EquityTree IO and you can also find me on any most major you can find me on Facebook or LinkedIn and you can also shoot me an email@dylanherquitygroup.com I'm happy to jump on a call and chat with anyone about anything. Don't be a stranger. Definitely feel free to reach out.

Awesome man. We're going to put it all in the show Notes. If you're listening, please go on subscribe and like if you haven't already, leave some comments. Reach out to Dylan. Dylan, thank you so much for all the value you've provided to our audience and look forward to catching up with you again soon, my friend.

Thanks so much, Chris.