Finance Pro Reveals The Secret To Not Be Broke in 2024

I haven't seen an opportunity like this to make generational wealth in decades. Yet the thing is, very few people are seeing it. You're going to be one of them. I went on the biggest podcasts and stages in the world. Millions watched, and I cut down the hours and hours of conversation to bring you only what you need, the playbook. But I realized the opportunity is a level four framework. Unless you build on those first three levels, you never get to the one that makes you the most money. This is called the evolutionary wealth theory. The. The four levels of the money making game are feel, walk, speak, mastery. And that's what you're going to learn today. You're not ready now, but by the end of this video, you'll see the opportunity and be able to act on it. That's the plan.

People that are in that sort of middle layer, that are comfortable, why do they never. Some of those people never really reach a point of financial freedom.

I think humans defer to the paths they've seen before them. I think so often we follow in our father's or our mother's footsteps, and that's why I think the Internet's really powerful, is you have an opportunity to now choose the family footsteps you want to follow into. So 1. I used to think it was just a knowledge gap, but then I went to this event and I was talking to my friend about it, and she said that the facilitators did something really cool. It was a group of women. Imagine, like 40 women a room, right? And they're there to talk about finances. And in this room, they said, okay, everybody close your eyes. And I want you to picture money. Picture money right now. And then I want you to turn your body into the shape you feel when you hear the word money, right? And so 30 women, all eyes closed. They take whatever shape, and she goes, now open your eyes and look around. And, you know, my friend was explaining to me how most people in the room were like fetal position. They were, like, holding. They were, like, really close. Somewhere on the ground, you know, some were covering their eyes. So in a room of 30 relatively successful women, their reaction was like, attack, shame, guilt for money. And she was like, you know, she was standing there with her arms open wide, like, you know, give me the money. And when I think about my relationship with money, it's the same thing. I'm like, if I think about money, I'm like, yeah, it's over here. Like, my hands are up. Like, I am here for it. But most people have this weird emotional attachment to money. And so I used to think that people on the Internet, like, not I like Tony Robbins, but like Tony Robbins or whatever, who do a lot of the motivational stuff. I kind of didn't get it. I'm like, just gimme the tactics, skip the other thing. And then I realized that most people have really bad stories that they tell themselves about money. And you could tell, I mean, it'd be interesting. Your next speech, you could try it. I tried it at one of mine. Same thing. Men and women holding each other like they're being beaten. When somebody talks about money, the average human feels that way. And so I think it all comes down to what we believe, which is hard for somebody in finance like me to say. You know, typically I would think, well, if you knew what to do, you could just do it. But that's not the case. It's, you have to believe that you can do it. And the only way I can figure out to get more people to believe that they can do it is to show more people who are super normal or in fact below average doing the damn thing. The first step is called feel. And this is the only time I'm going to agree with the manifesters, visualizers, all that crowd, and that is that truthfully, if you don't think that you will ever make money, you probably won't. If you think you will make money, you'll probably take the actions you need to actually make the money. So the first foundational principle is touchy feeling. You have to actually understand what it takes to have this change. And that's just your opinion of, are you the type of human that will be rich or not? And if you don't change this, if you don't change your mind, then it turns out you can't get the money. And so this first segment, while really short, is really important. Make sure to watch these couple clips because you will never master if you can't master your mind. I was a child of immigrants who came to the US and felt that money was something that would always be scarce, that money would never really be abundant, that we could never count on it all around us. And in fact, that if we ever got it, we should really make sure we hold onto it. Because the most dangerous thing we could do would be to spend too much and not save enough. And so I had a lot of stories about money that were about, hey, careful that you spent that here, Are you sure that you returned that there? It was all this scarcity and constraint. And the only really benefit to that I think was that I hate rules and being told what to do. And because of that, that story that I was told to not do X and not to Y led me to focus pretty aggressively on the fact that I never wanted anybody to ever control my finances or to have to worry day to day about them ever again.

The modern world tells us that we can get rich quick. And when you think about how people build wealth, we think about the Warren Buffetts of the world. It's so boring and slow and who's going to buy that book? Yeah, you know, be a billionaire at 87.

What?

I'm not going to be able to, you know, dance in the nightclub at 87. So why do I want a billion then? That's why the NFT thing and the crypto scam, this whatever, is also appealing to people because it's quick.

Yeah, it's true. Well, you know, what's. I actually was reading somewhere a story about in South Africa, in the slums, they have the highest concentration of the largest televisions per square foot of the house. So that if you've been there, and I've actually never been, so I can't validate, but you will see very small little rooms with huge televisions. And I thought that was interesting, but it actually makes sense because maybe it comes down to a belief that people don't think they're ever going to get out. And so they think the only chance of getting out is going into whatever the short term pleasure is. It's like if you never think you're going to escape your everyday reality, which is actually kind of miserable, then you're going to buy the PlayStation, because why wouldn't you? Why would you save and try to get out when you've never seen anybody else get out? Now that you understand feeling and the mind, we're going to get to walking. What walking means is you are going to realize that the environment around you, the humans that you relate to, that you engage with every single day are going to have the single biggest impact on your ability to increase your wealth. It turns out wealth is actually contained. And when you're walking around, that environment that you choose to walk in will determine whether you're wealthy or whether you're not. We have a bunch of statistics to prove this and we're also going to tell you a few tricks that helped me get the humans who are around me to be the type of people that will lift you up, not pull you down. Unfortunately, most people in life, really sad, want you to be just slightly less successful than they are they want you to achieve, but not more than them. And the people who are around you today and cheering you on at this moment actually might be some of the people who are the haters later on. Your friends right now will not be your same friends as you grow. It's just the truth. And so sit with this part to master walking and you'll get to go a lot faster. Watch these clips. Also, I read the statistic the other day that was fascinating. It goes back to making sure that you're with other people who have been red pilled as much as you humanly can. And the reason why is there's a study across 58,000 thousand hours in 11 companies where if you sit within 25ft of a top performer, your performance increases by 15%. You are no smarter, you work no harder, you are no better and you're 15% better, right? So if you make $100,000 a year, you're making 115,000 to really just cement the imagery of this. Now here's the downside. If you sit within 25ft of a poor performer, your performance suffers by 30%. And so it actually really, really matters what you listen to, who you sit next to, what company you work for. If you are sitting right now at a company with a bunch of people that you think are not grinding and growing, not only are you upset and you don't like what you're doing and you're not making enough money, but you're actually worse than you could be. And if you're in a company with a bunch of performers, you are better than you actually could be. And so I think that's why my companies, we've never really struggled to hire because I try to have a really high level of competence. And when people have a high level of competence, I very kindly tell them this isn't your place. Like it's on to the next for you. Because not only are you not a high performer, but now you make everybody else slightly worse. And so it's being that relentless, I think with who else is around you, it turns out that there's a power to proximity and your performance is contagious. Why do you think we've had any sort of success? If you could say that we, we have. And I think there's like three, three reasons. One is we go where the game is played. So if I wanted to be in supplements and fitness, I'd probably get my ass out here. The first form, if I wanted to be in tech and innovation, used to be Sam Fran, now It's probably Austin. Right. And so we've just gone where the game's played. That's step one. Most people won't do that. Most people will never leave where they. They were born. And then step two is we're ruthless for the people that are around us. And. And it's that stupid saying that you've heard a million times, except it's true about the average of the five people surrounding you, except what you find in life, you know, and what Chris and I have found is. And you are way ahead of me, so you've seen it probably so much sooner than I did. But there, there come these unlocks where you, you level up, you level up and the people around you can't support your next unlock because they know the past version of you. Yeah. And so I think they expect that. And. Yeah. And they love it. They love you. Yeah, they love you. And so they love that version. And they're scared for what the next version might be. So even if we're being super altruistic and giving them some benefit of the doubt, they're not ready for the next unlock. And so that's why I kind of. I obsess around getting around other builders, other people who tell me more reasons why something could happen and not more reasons why it couldn't happen. Because it's really easy to tell people why they can't do something. It's actually quite hard to show people how they can do something. And so anytime I'm around those people that show me, oh, here's what I know, here's how you can apply it. And like, yeah, I think you're capable and, like, you might fail, but we're just going to make sure two things. We're going to make sure we never let you make a decision that bankrupts you. We're going to make sure that we never have your first deal go sideways. Because if you think, if your first deal goes sideways, a lot of times people think, man, deal making is bad, not I need a bad deal. That's right, exactly. The people who love you, they want what's best for them, typically, which is that you're safe, you're secure, everything's okay. They don't really want what's on going, quote, unquote, best for you. Because that's actually the scary thing. Real growth happens when you take huge risks and you potentially fail and you realize that you're not going to die. And so I realized that my loved ones were some of the reasons that were actually holding me back. Super Supportive. But they were always saying things like, is the grass always greener? Cody, what about this next thing? Is that really going to make you happy? Are you sure it's not you? Is it them? And in some cases, they're right. I just have that. That ridiculous urge to keep growing and doing more. But that. That made me jump from 1, 2, 3, 4, 5, 5 finance companies in, like, 10 years or something like that, because I thought it was each. It was the individual company. And I didn't realize, oh, no, I'm just, like, unemployable. I want to work for myself. I'm not gonna be great at being at somebody else's employee. All right, so just like a little baby, you've gone from feeling to walking to. Now we're going to learn to speak the language of money and understand the language of money. This is where most people die. They get to a point where they manifest and they proclaim in the mirror. They start to level up the people around them, but then they never get technical with the game. And the game is a language just like English. You have to understand the terms. You have to understand the players, because if you don't understand the rules of the game, how are you ever going to win it? And most people live their entire lives without actually understanding the language of money. You're not going to be that, though. So sit in this next section. Some of this will feel technical. That's when I want you to lean in. I want you to write down the stuff you don't understand, because you won't hit the next level until every single one of the words you hear, you know and understand. Write in the comments. Any you don't understand. We'll write back to you what the answers are. Yeah, well, even. I mean, I always have a little beef with Dave Ramsey because he always talks about, like, don't get the Starbucks. You know, don't buy this, don't buy that. And my point is, you can always say your way to zero. There is a bottom limit of zero, and all of us have to exist on something. So zero is actually not possible. But there is an unlimited upside to earnings. How many times have you heard this story? I slept on my couch for two years to pull this off. I mortgaged my house. I barely made it. I'm so tired of that narrative. We've all done it. It is hard. Don't get me wrong. Being in business means that we're all in this room a little bit. We're masochists, right? Like, it's not that Fun, actually, you know, when you run a business, it's hard. Payroll doesn't get made all the time. Your employees are always the solution, but also the biggest problem. And we know that. But I want to get over this hustle porn nonsense mentality that you have to sleep on a cot or in a couch to make your millions. I actually just think that meant that those people weren't very good. Because guess what? I've accumulated a giant portfolio and happily never slept on a couch, even though my parents came from nothing and they were immigrants. So what if we could just work smarter instead of harder? There's a famous law called Tragedy of the Commons, right? And it's an economic theory that is really crucial if you want to understand why people burn instead of build. And I heard about it from a famous economist by the name of Thomas Sowell.

Oh my God.

Yeah.

If I was going to be a fanboy for anybody, it would be Thomas Sowell.

Me too. His book Economic Facts and Fallacies I think is crucial reading for anybody that wants to understand numbers, not regurgitate them, and to do it in a way that is a competition of ideas as opposed to let me just shout my idea the loudest. And he talks about, for instance, when I lived in dc, I saw it firsthand. We were in a new development, we were in Columbia Heights, and some of the streets were the hood, some of the streets were brand new developments. Across from us was a big project that went up, subsidized housing. Really well done, pretty. And sadly, within about the year that we were living there, it went from like a nice establishment to by the end, most of the houses boarded up one year. Woof. And. And I remember sitting there watching it. And at the same time I was rereading Economic Facts and Fallacies. And Thomas Sowell talked about this, about how instead of subsidizing housing, AKA making it cheaper for people, but having no skin in the game, nobody is responsible for anything in that place. And some of them live for free. What they've done is they've taken away their personal sovereignty. You know, have you guys ever been on a street, let's say, and you see those scooters around, right, that everybody you can rent for a few dollars, whatever, bird scooters, and they're like beat to hell. You know, they're thrown on the sidewalk in Paris. They throw them in the Seine all the time. And that is the tragedy of the commons in action. If that was your scooter, you would take care of it, but because you don't Own that scooter and you have no incentive one way or the other to take care of it. You beat it up. And you being collective, you, all of us. And so I think one of the biggest problems in our society today, we did this huge research analysis and it, it shook me. And it was, we looked at subsectors in the US economy. So not just construction, but let's say hardware stores and roofing companies. And what we found is across, I can't remember how many subsectors, but let's say 30 or 40. That 25 to 30% of all subsectors are owned by the top 10 companies in each sector. And that number is growing rapidly. So we don't own our local businesses anymore, we don't own our homes as much anymore. One in four single family homes in 2022 was bought by an institutional buyer. And so we are sort of, we're doing the narrative that's supposed to not be true, which is that, you know, you will own nothing and be happy about it. And we're doing it, we're letting it happen right in front of our eyes. And I think that's a horrible thing because you have all been to, I mean, you've certainly seen it here in la, but you go to a Starbucks, right? And outside it's like kind of dirty, beat up. The greeter doesn't know your name, the barista spells it wrong. They get your coffee, the beans are kind of burnt and it's lost what it was. The mermaid is no more. And then you go to a local coffee shop and what do you feel like? It's the same person every day. I just was at one in San Diego the other day. Gosh, I wish I remember his name so I could shout it out. But great little coffee shop in Bird Rock. The owner is right there, he's making the coffee for me. We get to know each other. He's having a community party on Sunday that is never gonna happen at a Starbucks. And that's why owning those small businesses is so important, I think. And that skin in the game is all the difference. So the first thing I would say, if you listen to anything, it's just like, hey, bunch of businesses are for sale. If you don't know how to do deals, you should probably learn how to do deals. And you can go to the Internet and just Google dealmaking, you can Google private equity. So I think that's first, the second thing that I'll say and then I'd be curious. Your take is like, when I buy a Business. A lot of people, they put a lens on a business that's Pollyanna. And so they'll look at a business to buy and they'll say, well, if I'm in charge of this business, then we're going to do X millions. The most important thing you have to remember when buying businesses is you want to buy businesses for what they are today. You want to look them in the eye and if they're ugly, you want to tell them they're ugly. And you don't want to try to buy a business and think that you're going to be better than the plumber that was in place there before because you're probably not. And so I buy profitable cash flowing businesses. And so my little framework to make it easy because I think that's important on the Internet. This stuff intimidated me before too is called brrt, which means buy boring businesses that are profitable. They have to make money in recession resistant asset classes like plumbing, landscaping, construction. Right. Raise prices because the average small business is underpriced by 3x in what they sell. And then add technology and that's kind of it. If you understand that, then you can take it to the next level. Too many people want to take a dollar and invest it in the stock market and have a Robinhood trade do well for them or a Bitcoin go up or down or an nft. And I think it's completely wrong. You should optimize first. We have a strategy called Learn, which is basically we want you to focus first on earning money before you do anything. And the reason why is because you can't. If you have money, it's always easier to make money. Rule number one, in order to make money, you have to first do the thing that is easiest and highest roi. That's typically not going to be that. You put a dollar into the stock market and it makes you $100,000. But what you could do is negotiate a salary increase of 5 to 20% each year or bi annually and you're much more likely to then be able to invest that money intelligently. But a lot of people, you know, instead of first earning and then learning and then investing, they go invest, learn, earn. And I think that's the opposite of what we want to do. Too many people have seen people make a lot of money in investing and it's a long game. All right, last level mastery. Don't sleep on the last three segments. If you haven't watched those all the way through and you don't understand them, give it a little rewind rewatch it and then come back here. This is where the money's made, but only if you've mastered the other four. So I think about this like you're ready to sprint. And at this level of the game, this is where the really rich speak a different language. The rich speak in contracts, they don't speak English and they speak in legally binding contracts that typically relate to one word, ownership. And we're going to break down exactly how you get into the ownership chair as opposed to be another renter or squatter in a world of money making. This segment is really important. Do you guys know who this is? Yell his name. Carlos. Slim. Nice. My Latino out there is like, of course. Okay, this guy. This guy's the richest guy in the world. Lvmh. Anybody know this guy? Charles Koch. That's exactly right. What about this guy? Ah, yeah, I love it. We got an Indian in the house too. Okay, richest guy in India. What's funny about this is one, you don't see these people on the Internet. Why? Because they get rich pretty quietly. Two, these people all have one thing in common besides their giant bank accounts. What do you think that is? Growth through acquisition. They own holding companies. You think Bernard came up with Louis Vuitton? Does this guy look like a fashion icon? No. He bought that thing for pennies on the dollar. Same with Dior and a bunch of the biggest brands in the world. They followed this playbook. And that playbook is what we're going to break down today. It's how a bunch of guys that look like this take your blood, sweat and tears as entrepreneurs. And just at the moment where you can no longer tolerate running your business, they buy it from you and they 20x it. That is what we are going to change here. We're going to stop. One thing I see happen to entrepreneurs again and again and again is that you sell at the point of pain for you, which is the point of profit for somebody else. And instead we're going to talk to you about the private equity playbook and growth through acquisitions as opposed to one client at a time. I'd say try to break your frame entirely. Most people look for individual next tactics. So they're like, what can I do over the next one, two or three years to get here? One thing I think is really helpful to do is say, okay, you have a three year goal. Break the frame. How could you achieve that goal in six months? What would be something so different, so out of the box, so big that the goal that was gonna take you Three to six years is now gonna take you six months. And I want you to spend some time on that. Spend a week, spend a weekend deeply thinking about that idea. Because what you're gonna do is you're gonna come up with ideas for the person that could be the impetus for your financial freedom or for the business risk. That's super smart, but you haven't been wanting to take it. And I think most people, they, like, they wade in the shallows of life, and you cannot have massive change by going shallow. And so I like to say, when people want an answer, I like to ask them a question, because I think they know. I think they know deep down inside, but they get scared, just like I did. And so they wait years to do the thing that they knew they should have done earlier. And I don't think you need a guru or a podcast to tell you that. I think you've got to break your frame and say, I'm super capable. If I was going to do this crazy thing in six months, if anything was possible, if I really believed in myself, what could I do? Who could I go to that could make an unfair advantage for me? And I do think that book, who not how, people usually read it as leaders because it's a lot about hiring, but I think it's actually about life. And I think usually your answer to freedom is a who, not a how. Because often for hustlers and people who are gonna work hard, you know, one or two people who are very wealthy or who run big businesses, there are a few people in your ecosystem that you could go to and become their hustler for them. And that can lead to fantastic financial reward, because most people are not relentless in the pursuit of the things that they want. If you can be relentless, you can accomplish way more than the average person. You know, I was sitting talking with one of my. One of my friends the other day, actually, and he's a. He's a billionaire. You know, probably like what some of those conversations you've had with Tony and. And we were sitting at his compound overlooking the lake in Austin. It's beautiful. $60 million. Like, it's so great. And he's a former hedge fund manager. His name's Bill Perkins. I'm walking with Bill, and Bill invites me over to his house, and I'm. And I'm a little late. So now I'm stressed because I got lost. So I'm like, bill, I'm so sorry. I'm here. You know, I will get out of your hair, right out of this. He's like, whoa. He's like, you're the reason for the day. Don't worry about it. It's all your time. I'm like, no, no, no, you don't have a lot of time. I'll be here. He's like, stop. You're on the agenda today. I'm like, why? And he's like, well, I think that perhaps you have been investing in small businesses for so long that small has infected your thinking. I was like, painful also. Why? And he's like, you own this portfolio of small businesses, and that's great, but I don't think that's anywhere near enough for you. And I think that you still are thinking like that employee you were working for somebody else 10 years ago. And he's like, I just have more zeros, which allows me to see wider than you do. And so I think my biggest fear is actually that I stop having conversations like that, and then I don't take action. And, you know, when I was in. In finance, I remember leaning into the uncomfortable, right. What is that moment where you decide wherever you are? Where I decide I'm not going to keep going because I'm scared. I don't think I can. Maybe I need somebody else to do it. And I see that in so many humans that it scares me. I'm worried, is it contagious? And that's what I don't want to have happen. I want to be in a room as often as possible, the littlest human, the smallest, so that I can keep sort of reaching for the next thing. And not just monetarily, because categorically, like, I mean, you see my outfit, I'm wearing, like, sneakers, you know, driving my mom's car here, you know, I stayed with my parents last night. Like, I don't really care about the money, but it's somehow like, at the end of your day, remember that? Oh, gosh, who is it, Hemingway, who said, like, at the end of the days when I show up at the pearly gates, I want to be there, bruised, battered, sliding in and saying, that was a hell of a ride. I think more humans need skin in the game in some way, shape or form. It's the only way to feel like you have. You have ownership in this world. You have something that you are striving for and building. And most people rent their apartments these days or for their houses. Most people work at jobs where they don't have equity in it. Only 15% of humans actually own stocks, which would be equity in companies, by and large. We're becoming a nation or a world of renters. When we started, you know, over the last century, finally becoming owners after years of serfdom. And so that is my mission, is I want more human beings to have their little, their little plot of land, figuratively or physically, because I think that that changes the way we look at the world. Then we start to stewards of it. Then we start become stewards of our country. You don't burn down the building that you own, right? You fix it, you renovate it, you build on it. So that's what I hope our mission is. I hope that when I'm dead, I hope there's a bunch of people that would never have owned anything and now own something and they get to pass that on to the next generation. Because otherwise just the guys at the top own everything. I mean, one out of four houses last year got bought by three companies in the us Single family houses. We don't even own our homes anymore. And so that I think needs to change. The entire purpose of what we're doing is to make sure that the few don't own everything. What I noticed is across almost every industry, we have the illusion of choice, when in fact the very few own the very many. Whether that's BlackRock and KKR owning most of our real estate increasingly and our small businesses, or whether that's something like the four main soft drink companies owning 85% of the market. The goal is to get more humans like you into ownership. I don't want to be the next biggest private equity firm. I want to teach a bunch of humans that all of us could actually own our communities because I think that's a better world. That's why I'm going on these podcasts and why I have this YouTube channel. We have a generational tectonic shift happening in the world and that's this. It's that baby boomers are retiring at all time high levels to the tune of trillions of dollars and 11.2 to 12 million small businesses being on sale. The vendors that you work with, those owners typically want to sell in some way, shape or form. The people who service your home in varying ways, they probably want to sell too. We are having a massive shift from the fact that baby boomers got accelerated by Covid. These baby boomers got tired after the businesses closed down. And in fact 80% of all restaurants on Yelp that closed ever for Covid. What do they do? They shut their doors for all time. This is fascinating because how many people in here own a business. Raise your hand if you own a business. Okay, most people. Now keep your hand up. Sorry. Keep your hand up. How many people in here would sell that business at the right price and terms? Shocking, really. If you look around the room, there's hundreds of you. And in every single room, do you know what people say to Chris and I and my team? They go, well, Cody, no deals to be found. I'm like, motherf cker. Look around. There's deals everywhere. Anybody that owns a business, if you catch them on the right day at the right time with the right offer, what will they do? Sell, of course, because we're masochists and running businesses is hard. And so if you can find people, people at the right time, you too can acquire a bunch of companies and become an empire builder.

Ladies and gentlemen, Cody Sanchez.

Thank you, guys.