Investing with Dave Zook

Welcome to Ladies Kicking Assets, where we are providing the financial education you need to live the life you want. We are your co hosts, Robin and Courtney, and we are so glad that you're here. We are not financial advisors. This is for educational purposes only. But we are really super excited about our guest today. So, Robin, why don't you talk about him, introduce him to us and the world.

All right, well, I have the pleasure of introducing Dave Zook. He is just an incredible speaker, but a superstar at syndicating. He has a business line called the Real Asset Investor, and he's also involved in so many other projects. So thank you so much for joining us today and speaking to our viewers. I've had the pleasure, as well as Courtney to hear Dave speak on a number of occasions, and he's so powerful with his words. And so I just am grateful that you're here today and wanted to just kind of ask you to share a little bit about your diversification of your portfolio. I know that you're involved in a lot of different asset classes and, and that's a different strategy than many investors and how that sort of came to be.

So first, thanks for having me on your show. I appreciate it. This is gonna be fun. My story is I was born in a very entrepreneurial, business, friendly family. I was involved in the modular building space pretty much all my life. My dad bought the business here. I was born, I'm still involved in the family business. I now run that with three brothers. And so, you know, growing up in business, I started several businesses in my, you know, late teens, early 20s. By the time I was in my late 20s, I got myself into, you know, I got my. I got myself a tax problem. Some of these businesses were doing very well. And I ended up paying taxes in the tune of, you know, half a million dollars. And, and, you know, I was having fun building business. I was doing what I was created to do. I was having all kinds of fun, spending a lot of time, energy, effort and all that, but it didn't even feel like work because it's so much fun. And. But when I had to give up half my money and give it back to the government, it wasn't so much fun. And I vowed that I was going to figure out a way to not do that anymore. And so by reading self educating and diving in deep, reading books like Rich Dad, Poor dad, and hearing Robert Kiyosaki talk about, you know, how you can make millions of dollars a year and pay no tax illegally, that really intrigued me. Well, it drove me Crazy, actually, because that wasn't me. Yeah, yeah. How is that possible? How is that legal? You know. And so I went down that path. Soon realized that real estate, specifically multifamily apartments at the time was a great investment. Not only from, you know, a, you know, building wealth through cash flow and appreciation, equity and all that, but it was a tax protection vehicle. And that's sort of the door I entered. And so I quickly started accumulating real estate, bought multifamily apartments, bought a couple hundred units of my own, ran out of money and then got my friends, got my family involved first. And then I, you know, expanded that into friends and family. And then, you know, before I knew it, I was getting people involved all over the country and became a syndicator. It really wasn't something that I planned long, you know, a long time out ahead. That's what I wanted to be. It was more. It kind of. I saw an opportunity and I, and I went after it. So that was the start of me being a syndicator and raising capital to doing deals. But I've really, I've been an investor all my life. I've been an investor since I was in my teens.

I think that's amazing because when I was 18, I was not thinking about investing or where I was going or what businesses I was building. I wish that I had been, but I was not.

So yeah, I was investing in non assets.

You know, some, some days I wonder if it's a disease or if there's something that matter. But no, it's. It's been an interest of mine all my life and it just, you know, it's something that naturally gravitate to and I love it. To me, investing is like. Investing done well is like farming. You know, you acquire a piece of land, you plant the seed, you nurture that seed, you put the right fertilizer on the seed and then you, you know, watch that thing bloom and you know, at some, at some point there's a harvest and, and so that, that's what investing is to me. And I just have a lot of fun with it.

I love that. That's.

I'll be an investor till they die.

Me too. And when you do that, I love that analogy because when you come to see the fruition and you, you're collecting your harvest, it's very fulfilling. It's very, it's really cool to watch that happen and grow and do so.

No, it's been a fun journey and it's been fun, you know, it's really been Fun. Getting to know so many people along the way, helping people, helping people not only accumulate wealth, but also educating and watching people have those light bulb moments, I realized, I quickly realized that the problem I had from a tax perspective, a lot of other people have that same problem. And I also realized that there's lots of very sophisticated business people who've spent most of their working life, maybe the last 10 years, 20 or 30 or whatever, and they built themselves an incredible business and they have very little understanding of about tax and how that you can offset the tax liability on your income, whether it's ordinary income, passive income, portfolio income, whatever. And so it's been a lot of fun just educating people and teaching them the non conventional side of wealth. Conventional wisdom tells you if you make a lot of money, you got to pay a lot of tax. And it's not true.

That reminds me just literally at that secrets of syndication that we were just at, you know, Brad Somerock talked about how he was so excited about how, you know, his goal was to get to where he was paying a million dollars in tax, you know, because once he reached that certain level, you know, until he finally realized that, holy crap, I can really, you know, grow this and not pay the tax at all. And so I think that's what was such a huge, profound thing that I figured out here a couple years ago was, wow, I didn't realize that either. And so now I'm very strategic. My investments and my, you know, everything that I'm doing and a lot of, you know, the syndications I'm doing, most of the people that are coming to me are looking for those tax advantages. And so one of the things that I took from you, Dave, is, you know, trying to make sure that I can solve people's problems. As, you know, I'm bringing this, but then solving a problem with what we're creating, you know, the issues we're creating with that. So, and then having that answer and you know, now I've got people coming back and going, oh, this was so great. Thank you. You know, I'm going to, here's, here's my friend. Can you help him too? And so it's really rewarding to have that happen as well.

Definitely.

And that's what it's about. It's about adding value to your community, adding value to your listeners now, adding value to the world. And when you figure out how to add value to people at scale, the more people you add value to, I mean, look at your iPhone. So you look at some of the most successful People or companies in the world, and you recognize that, oh, okay. They're successful. They're so successful because they've figured out how to add value to millions and millions and millions of people. So that's really what it's about, is adding value to people.

It's the Go Giver. It's the best book ever. I mean, Power of compounding. Yes. Well. And what you can do to help other people succeed. It's about what you can do and bringing value to others. It really is. And, you know, my. I read the book and then my husband read it, and then our kids read it, and it's just. It's. I love it. And I always think I'm like, oh, you're the connector, or you're this person. And it's just. It's really great. And that's really kind of where Rob and I are coming from and why we're doing this, so that we can help other people, you know, make a difference in their lives and help them implement and take action on some of these things. And so love how you are. So I know you don't send. You're not syndicating apartments. Right.

We did our last apartment deal in late 2018, so about three and a half years ago.

But you have a lot of other different assets that you syndicate and a lot of other areas that you're involved in. And I'm always fascinated with some of the things that you. I feel like you've got your hands in a lot of different things. Yeah. Can you talk about that a little bit and maybe kind of what led you to some of those asset classes that you're in?

Yeah. So people ask me sometimes, man, you must be really busy running around finding these different asset classes for your investors. And that's sort of the opposite approach. In fact, it's exactly opposite of the approach. Really, what I do is I go out and invest in things that I like, that I believe in, that I love to invest in, that I feel have a real potential to really take off in the future. And so I'm investing in those things. And probably when I invest in 10 assets with several different operators, there might be one that sticks. And when I find one that I really like and I find one that I love the. Not only the asset class, but I love the team. And, you know, I find a team that has a great track record, have been doing it for a long time, that's their one thing. I love to team up with that. With that team. And when I have some sort of track Record with that team. I typically. And it's an investment that has some scale that I can bring to my team, to my investors. Typically, that's what I'll do. And that's worked out really well for me. And I'll give you an example. So I was an ATM investor for about four years before I brought it to my investor base. And I quickly helped grow that company from a small friends and family sort of company to now one of the top four ATM operators in the country. But I was an ATM investor for about four years before I brought it to my investor base. Same way with energy. I was a natural gas investor for about four years until I, you know, until I really decided to go in deep and scale that. And so typically, I'll go in with my own money. Oftentimes I'll go in with my own money for a while first and really vet the team and vet the asset and really get comfortable with what I'm doing. And then, you know, if I feel the time is right and the team is right, then I'll bring it to my investor base.

Mm, that's cool.

I really love that. I love that you take that time to go in and make sure that it's right and make sure it's right because it's, you know, it's so important to be a good steward of other people's money. So let's see here.

You. Speaking of money, there was this. This phrase that I wrote down that you said that I felt was so powerful. It was use money and love people, you know, and, you know, I. I love how you use that as a vehicle, but really you're meeting the needs of the people around you, and then the revenue comes, but take care of the people. And you've spoke so many times about just creating and fostering and continuing relationships, and I think that's so important as we're investors and syndicators. So many times I've talked with individuals who were new in the business, and I consider myself still to be new in the business. They fail to remember the relationship component. And it's about the deal. And you've just expressed over and over and over again that it's really about the people, you know, and so could you speak to that a little bit, how you've seen that play out?

Yeah, I mean, this. You touched on it. This. This is a relationship business. I mean, you can go out if the deal is good enough, you could probably find the money. You can go out and, you know, get the money, do the deal. But if you really want momentum. You know, you gotta have a relationship, you gotta have a relationship with your investors. They need to feel that you've got their best interest in mind. Some of the ways that we've gotten creative and structured some of our deals is kind of non conventional, even in the syndication space. And some of that is just to make it very obvious that our goals are aligned. There were several of our investors where, I don't know that I would recommend this to syndicators, but there's several of our investments that we are. Not only don't we make any money until the investor gets all of their principal back and their preferred return, but we're actually underwater until that happens. Meaning we cover the cost of running the fund, we cover the legal costs, we cover the cost of setting up the fund, and we don't make any money until the end when our incest and when, when our investor is paid out. There's several of our funds that are set up like that. So when you, when you can clearly show your investors like, look, we are aligned here, we're not going to make any money until you, you know, until you, till you've hit your projections, that speaks loudly and clearly to them. You know, of course, you know, right behind that, behind relationships is reputation. You know, you only this is a reputation. If you get a bad reputation in this business, you're going to struggle. And so it's important that you deliver under promise, over deliver. It's important that you deliver what you put out there. And so those two things in this business, if you can do those two things well and then get good solid deals out to your investors, you're going to do well in this space.

Now that's really, really great. So tell me, I know that you are involved in all these different spaces right now with all of the crazy inflation that's happening and everything else. Where, where do you find some safe places to invest to protect your wealth?

Yeah, so well, for us, we have our core products. I, I love commodities. I, I, you know, I, I think, I think going forward, commodities in the next couple years, I mean, they've typically done very well in times of inflation. There's certain kinds of real estate, when I look at, we do a lot of self storage, that's typically an asset class that does very well in periods of high inflation. It also does very well in times of turbulence. When you look back at 2008-2010, self storage, one of the best performing real estate asset classes out there, you look back at Covid, one of the Best performing real estate asset classes out there. I love an asset class where the asset does really well in good times and maybe even better in times of distress. So that's a good hedge not only for inflation, but for, for. It could be a recession area hedge. And then look, just, we're seeing inflation now that we didn't have thought, we thought would have been crazy two, three years ago. And so you look at typical conventional approach to stock market investing and you're thinking, okay, over long term, that will deliver you a 7 to 9% return, right? Well, if you're getting a 7 to 9% return, you're barely, you know, you're not breaking even in these type of.

Markets, losing money for sure.

And you know, and of course I'm, maybe I'm a conspiracy theory, maybe I'm a whatever, but I just believe when the Fed or when the government is telling me that inflation is eight and a half percent, I think it's probably more like 15 or 20.

Yeah.

So, you know, I mean, look around, I mean, when, look at, look at things that are things that we buy, you know, rare desirable assets, you know, desirable piece of real estate on the water, on the lake, on the river. What's happened to that? What's happened to that in the last five years? It wasn't eight and a half percent inflation, it was a lot more than eight and a half. So look at, maybe not milk, bread and eggs, but look at rare desirable assets that we buy. It's much, much worse than 8.5%. So just keep that in mind for your listeners when you're out there looking at an investment, when you're out there looking at investment asset class, some of our energy investments, I mean, for me, I'm getting energy monthly distributions where we're making more on a monthly basis than a lot of people would expect on an annual basis. And so, you know, just the opportunities that are out there in the space. Look, if you have, if you find a great operator in the right asset class, this is the time to shine right now, in the next couple of years.

Yeah, commodities is definitely, you know, we've been involved in oil and gas for a very long time, but some other commodities, you know, that we're looking at getting into is coal and some other things. And that is definitely not my specialty or forte and I'm having to do a little bit digging, but I think that is definitely a really good, it's a place where we're looking at, you know, diversifying into very much so. So we're heavily Involved in, you know, real estate. Actually, I'm involved in one of your store. Your storage funds. And so, you know, that's not my specialty. So I go to the experts, but no coal and natural gas and some of these other areas are something that we're looking at actually moving and diversifying into. I think right now is a really good time to do that.

I think, you know, I mean, look, the Wall street and paper assets have. Have had their time. I just believe in the next. In the next decade is going to be the time to own real assets.

Yeah, for sure.

It's a great. It's a great time to be a real asset investor.

Oh, that's so true.

For our listeners that would want to get in touch with you after we, you know, are done with our show. How can they do that?

So our website is thereealassetinvestor.com and if somebody wants to reach out to us directly, it's infoherealassetinvestor.com and we're very responsive. Someone from my team will get back to you if you reach out and ask for any information questions on anything related to any of our investment asset classes. We have reports that we write up on this stuff, so definitely can follow us and reach out to us.

Okay, that's awesome. That's amazing. So thank you so, so much for taking the time to come on and speak with us and speak to our listeners. I really appreciate it. I want to be like Dave when I grow up, so. You're such an inspiration and you're such a great person.

I didn't grow up.

That's right.

And we were having that conversation before you got on. I think what's so amazing is how successful you have become in such a short window of time. And you're mentoring your family and your kids and so many people and are so accessible, and you just want to keep sharing. And I just, you know, you've just blessed so many people in your path, and I just think it speaks volumes about your character. So I really appreciate that about you.

Well, thank you. I appreciate it. You're welcome to donate for a long time.

Yes, absolutely. So thank you, Dave, for your time. And I just want to reiterate for our viewers that please go to our YouTube site and subscribe to Ladies Kicking Assets. And we look forward to having another guest on our next episode. And we just want to graciously thank Dave for his time. Thank you so much.

All right, thanks, you guys.

Yeah, bye.

Bye.