#32: Brian O'Neill, Real Estate Investor & Entrepreneur - Starting a business in a recession, getting off the W-2 hamster wheel, and the power of masterminds

I mean, I ended up putting 200 grand more into that location. I was every month writing checks to try to figure it out. Like, I'm not going to fail, I'm not going to fail. I'm not going to fail. I'm going to figure this out. And slowly started to figure out. But honestly, I reached the point where I drew a line in the sand and basically said, I'm not putting more money in this business. It has to stand on its own or it's going to. I can't. Because what was happening is I was hurting my original business, my construction company. I was borrowing money from it. I was taking all my profits out and putting in here. I was, I, I would go to work from 8am to 4pm Monday through Friday at the construction business and I'd go from 4:30 to midnight usually at the restaurant. And I just repeat it over and over and over.

On today's episode, we have entrepreneur and real estate investor Brian o'. Neill. Steve, I, I particularly love this, this episode with Brian because there was one trend throughout the whole thing and it was life kept throwing obstacles in Brian's way and he figured out a way to always persevere. I mean, he had businesses that weren't working out. He had people stealing from him. He had owning a restaurant in California during COVID All these obstacles and yet he persevered to, as he said, get off the W2 hamster wheel. And now he's living a life of passive income and investing in real estate. It was just, it was incredibly inspiring to see him overcome these obstacles and just persevere through life.

Jake, I love hearing his story because I could, when I was, when I was hearing it, I was thinking about, it was somewhat analogous to my story when I was starting my businesses. And whether it's life or, or businesses, you're going to have ups and downs. The good, the whole thing is never give up, overcome the obstacles, persevere, because you'll be learning on the way. Very similar to, as we call it, you heading west.

Yep, yep. Absolutely. Well, with that, let's just head west. Stay tuned as we discuss starting a business in a recession, getting off the W2 hamster wheel, and the power of masterminds. With our guest, Brian o'.

Neal.

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Yeah. So I ended up with, I mean technically four businesses. The first one was in college, so I don't count that one, but three businesses trying to create what I saw my dad originally had. My dad's a dentist and he wanted me to become a dentist. And I. He made great money. Obviously he's a specialist. But I realized even, you know, back in high school, you're trying to figure out what you want to do. Everyone around me was like doctors or dentists. Become an engineer. And I just remember we'd always go on vacation. My dad was always more stressed because he wasn't just not making money. All his staff was still sitting in the office, you know, cleaning or doing whatever. Whatever they do when he's gone is his overhead is still burning. And I just always thought I needed to do a business that can make me money when I'm not there. Like I'm not the center of it. And I ended up starting three businesses and every time I was the center of it. And I then started to research and realize that's a super common problem. I read the E Myth and all those things and about. But we can go back to the very beginning if you want. When I first business, how I got in there. Yeah, so I graduated with a degree in construction Management, because I wanted to go, I like to build things. I originally started computer science engineering because I was kind of a techie guy. But the, the workforce you have to work with didn't really connect with me. The nicest way to say it. So I like to build things. So I went to Cal Poly, which is a great school for that, and actually focused on the homebuilding industry, which is where not a lot of people with construction management degrees go. I want to say. It's not as glamorous, but I thought I saw an opportunity there basically. So I went in 2006 or seven, worked for a national home builder. Great timing. I found out afterwards, you know, a year, year and a half later, I think we had 140 people in our division and we were down to 40 or 60. And I was one of the last guys hired. I was like, I don't know why I'm still here, but I can't imagine that being here much longer.

You're the lowest paid.

Exactly. Yeah. I wasn't being paid that, that much. I mean, fine for my position, my, you know, experience, like, I gotta get off this ship because I was actually in a leadership program. I got to see all the different departments. So I would go in like, you know, the land development guys and see their hair's on fire and they're, they're walking away from half million dollar deposits on land and then the big ones. I went to like the controllers department and saw we're writing checks for like 20, 30 grand every time we'd sell a house like this.

Wow.

Sales people are all happy. They're selling houses and like the controller's freaking out because we're losing money on every house. This was before all the news was in the news, like, oh, this is, this is gonna be real bad. So my dad was building a second house that I had designed and it was up in Oregon, it's by the Rogue River. And we couldn't, we wanted to put home automation into it. And that's why this, when I first started in home automation, just interested in it and couldn't get a vendor to go up there. And they wouldn't sell me the stuff. And I was like, well, there's gotta be a way. So I made a fake company called Link Systems, got a website for it. I went and rented a Regis office, you know, that's by the hour, conference rooms. Yeah. And convinced the vendor that I was going to start Link Systems, he should give me a vendor account. So I got some of the, you know, vendor accounts just so we could do my dad's house. We end up doing it. And then a family friend was like, hey, will you do ours? And then it kind of just. It was literally a joke. I started as just a way to get cheaper equipment for my dad's house, basically. And then when I started seeing that the housing market was really going down, I decided to just jump ship and start doing that. So we. Every business I've started has either started in or gone through a significant bad market, I guess you would say. Like, I. I seem to start things in bad markets for some reasons. Yeah, well, it was on purpose. So, like, when I started that company, it was called Link. No one was doing new construction. So I just pivoted to like, let's do all remodel. People are buying these houses out of foreclosure and short sales and they're pumping money into them. And all my competitors were fat and happy. So they were just big bloated. You know, they had been living on the sauce for a while and they were having a hard time shrinking down. They had huge overheads. This is when the iPad first started coming out and everything went IP and they just had these, you know, guys that were 60s, you know, about to retire. They didn't want to deal with IP addresses and networks. So we kind of just. Or a scrappy startup. When everyone else was bleeding, we used that to our advantage. So I did that for, you know, five, six years. I figured it out and I was making good money. I started getting really discouraged that I was doing the same thing my dad did. I couldn't leave and make money. All my employees relied on me. I realized 20% of the jobs I was doing was making me 80% of my money. So I was like, I could just go do those myself with an assistant and not need all this. Then I read the E Myth. I was like, okay, I just need to attack this business and put systems in place and grew it probably the two or three times its size, had sales teams, installer crews, and got much bigger. And I don't want to say I failed at the E Myth, but I couldn't figure out how to get this business to the market I wanted to focus on. I wanted to do higher end stuff and get it systematized. And part of the issue I ran into was this technology changes every year. Like every single year, everything changes on us. So we get it all figured out and everyone's trained and we got a system running. Then boom, everything changes. So I kept looking like, what else can I do? What else can I do? And my buddy had a restaurant and he had partnered with a franchise lawyer in California. If you can get a franchise going, it's expensive legally, but that's a good barrier to entry. So he wanted to expand his location. I seen his financials. I know don't do restaurants. Like, I'm not going to do restaurants. I had a goal. When I turned 35, I wanted to buy a stupid car. I called it so like a Maserati or Aston Martin or something. And I had saved that money into a bank account. It was sitting there and I went mountain biking with my buddies. Like, we're doing this. Like the hardest thing with the franchise is get the first person the, like the first copy of it. Basically I was like, okay, man, I've seen the money you're making. Like, I'll finance the first one. I'm going to own it outright. You're going to run it, I'm going to pay you to run it. Basically when the franchise gets off the ground, you finish all the paperwork, which is supposed to be December. I get all of Northern California as my territory down in the Bay Area. That's what I wanted. I basically wanted the territory. Well, I think I have a non disclosure. I'm not supposed to say certain things, but basically they didn't do what they're supposed to do. The franchise never appeared. Basically. I don't know what they were doing with the money, but it never appeared. End up renegotiating. I ended up taking over the restaurant. Now I had to run a restaurant. So that's how I got in the restaurant business. It was either lose my, you know, few hundred grand I'd put in it or. And also there was some threats made that pushed me against the wall that like, no, I'll figure this out.

Yeah, what I, I want to jump real quick. What was it about? So you started off, you saw your dad. He was super successful, but he was the cog and the whale, the main one. And everything relied on him. When he, when he, the cog was removed, nothing functioned, you know, properly. What was it about that you saw that you saw that at a young age and then didn't want to replicate it, but then replicated it. What was it about that, like, what was lost in translation there that made it difficult to not build it from the beginning without you being the main centerpiece.

I mean, having no examples of like now, like in real estate and things like that. There's so many mentors and examples you can just go look at. But when it comes to like a specialized construction company, like you go to a national convention, that's their biggest access to anyone that's doing this. Maybe you sit in a room for two or three hours and hear how other people have done it. And usually they're much bigger when you're starting, so you like, you can't connect. Like, how do I go from doing less than a million in the beginning and they're, they're, they've reached the 3 to 10 million, you know, that jump, basically. And it's like, how do you do that in the beginning? And I just didn't know what I didn't know. It's the first business I've ever done. I didn't really have business people to go off of around me. So I was like, I'm good at organizing and good at systems, but I also, I just made myself the center. And what's interesting is as I did more businesses, I started to learn how to not do that. Yeah, yeah. How I could have done that.

That's a tough one. The reason I ask, because, you know, you, you work with business owners. We work with business owners a lot. And Steve, I'm sure you pick up on this as well, but that question comes up a lot is how do I get myself out of being the main cog in this business? How do I fire myself from every job title that I have within my business so that I can actually enjoy the fruits of all my hard work? And there's a few books and mentors and people out there, but it's really difficult, even with the knowledge of I shouldn't do this, to not get that position. And Steve, I'd love to hear your thoughts on it because I know you've started, bought and sold businesses over the years. How do people do that when you.

Don'T have money to hire a six figure sales director? And I think that was a limiting factor. I hadn't figured how to get enough sales in the door to then pay the type of people I needed in the beginning.

That's, that's a scary process. And thought, but Brian, I want to go back to. My dad was an insurance agent and he wanted me to come into the insurance business and figuratively put his arm around my shoulder and said, steve, it's time to be a man and why don't you go take the insurance exam? And so I did and I flunked it miserably. An amoeba could have passed that insurance exam anyway, so I didn't go in the insurance business. I went into engineering. But you and. And became an entrepreneur. But you're talking about that's some of the toughest things business owners have to rapple with. My goal was always to sell my business and businesses. But owners can get wrapped up in the business. That's their identity. That's how they're doing things. I'm the main guy. I go to the country club, I go to the whatever meetings and I'm president CEO of something something something. Well, guys get themselves into trouble when they go to sell the business because they are the business. And you owners have to start thinking how can I be replaceable? How can I bring somebody in? And sometimes it's. It does take money to hire somebody smarter than you to run the business and get out of that. But it's a really, really tough thing. And, but if you can think about it and start that process mentally, you'll be a lot, a lot further along. And one other thing. My dad sold his business at shoot back then was almost 70 in the insurance business. And I said I'd never do that. I didn't want to get to 70 and have to sell it and then find that no one's going to give you any money anyway. So it's crazy.

I don't know if anybody. I don't know if there is a, a great way of building unless it's maybe a lifestyle business that's probably a little easier to, to automate and delegate right off the bat. I think it, it just takes a constant, a mental note of okay, I can build this thing, but I also have to keep in the back of my mind of how do I automate this thing I'm doing or delegate it to somebody else earlier rather than later. I don't know if there's any other. If you're trying to build something that scale, you know, is bigger and scales. I don't know if there's any way of building it right off the bat where you're not the centerpiece as the.

And I think I, I lost motivation because I've realized now, having done this a few times, I'm more interested in the creating, starting and getting it off the ground. I'm less interested in running it for 10 years. And I now I realize that, that I'm on my third like my third business. I intentionally didn't learn how to do a lot of things in the business that I normally would like how to set up a POS system or how's the accounting system working. I intentionally, I don't want to know. I just want to know I have a person that's in place that knows how to do it. They know what reports I want to see. And, and I literally don't know how to log in and it, but putting that barrier because I'm such a, like get in there. I want to know exactly how we're doing it. And that's, that's the, that's the mistake I had made is that I put myself in everything and not hired the right people.

I think also you have to put yourself and your yourself in a frame of mind that I'm the conductor of the orchestra. I'm not the best violinist or cello player, etc. And if you could do that, you're miles ahead of a lot of people. But you're the conductor. That's what you do.

Before we jump back into the, the into your journey into the restaurant business, you brought up something that was really interesting about starting a business within a recession. And there's something I'd love to hear your thoughts on. Was that intentional? Was it, you know, just coincidental? But I always found it really interesting that a lot of really successful businesses started during a recession. And I just pulled it up because I want to make sure I got all the, the, the big players. But Netflix started in a recession. Airbnb, Trader Joe's, Microsoft, Sports Illustrated, mtv, General Electric, Warby Parker. I mean, the list goes on and on of these businesses that have lasted and they've stuck around and they started in what is seemingly the most difficult and probably treacherous time to start a business. And, and I kind of liken that also to investing in real estate right now where a lot of people are saying I should hold my cash, I shouldn't invest. There's a lot of proof in the pudding of this is actually the best time to invest. So. And we'll get to that real estate piece. But for you, was it intentional starting a business in a recession? Was it coincidental? And what are your thoughts on your success in business that's due to being in a recession?

I'll say the first one was coincidental. I didn't really choose that and I don't think a lot of people realize how far that was going to go as far as affecting the economy. But I thought back a lot about how that worked and why we were able to grow that company and do that. If you think about it, during a recession, it's so much easier to get better employees. The big guys are laying people off or they're leaving because they can't make much money. They're cutting back on their marketing. They have all this overhead so they can't get lean and mean on their pricing. Where if you're a scrappy startup, you're Lillian. We stayed in startup mode in my mind, for a number of years through that downturn because we started there so we didn't have to scale back. We were trying to just figure out we have a limited amount of money, we have limited sales. How can we find a niche in here and be the big guys who were. They were just. It's hard to explain, but, like, they had gotten really fat and happy.

Yeah.

And they. They were in. How do we pair back and survive? And we're like, how can we pick up little pieces right now and grow? And that's probably. That probably works for almost all industries. You're not competing like real estate. You know, do you want to compete with 40 offers or four offers? That's what we're seeing right now. So there's. There's always opportunity out there to make money. Like, I pivoted. No one wanted to do re remodels and things like that and deal with people that are picking up houses that are out of foreclosure. So we did. And we just figured out how to make money doing it. When the market turned, we left that, went back to new construction because it's easier. You make more money. And we did home shows. Like, no one was doing home shows. Like, that seems so lame. I guess you would say. No, but no one was there. No one was there. 18 garage door companies and 10 these guys. And we're like the one person that does technology in people's houses and they're staying in them. And we just. We had no competition.

Yeah.

And then finally people figured it out and they started to show up. And then we pivoted away from that. So. And I was just Start a small company. Like, how do you. How do you get over a million dollars in revenue? And, you know, you gotta be scrappy because I. I didn't have any money. I borrowed $70,000 from my mom because my first clients kept asking, like, oh, do you have a showroom? Do you have a showroom? Because that was the thing during the big housing market. Everyone had these beautiful showrooms. And you were a nothing. You were. They call them a trunk slammer if you didn't have a showroom. So I went and rented some place and spent 70 grand, did all the work myself. One person came there the whole time I had that. It was just so you could say you had It. So it was a total waste of money. That's basically most money I spent on the thing. And the rest was just figuring out how to get clients and door.

So, yeah, yeah, that's. That's one of those. Those cases where listening to the customer was not the best plan. You know, what the customer wants is not always the best thing for your business. The showroom being the. That example. Okay, so you jumping back into your story, you take over this. This restaurant franchise, having simulated it sounds like no experience running a restaurant.

I never worked in a restaurant. I served a restaurant.

And also knowing that you should not be in restaurant business. Yeah, I think I picked up on that. Okay, jump back in there.

I just, I don't know. I don't like being told to do. I'm very like, if someone says, do this, I'm going to push back. So there's certain things I can't talk about because I'm pretty sure I signed saying we can't talk about it, but things were said and like, up there, basically, like, he's going to fail, calls when he fails, and, you know, things like that. So when someone says that, that, that, that's the best motivator. Actually, through the history of business, every time I've had someone push back or some ultimatum or just kind of, you know, do something like that, that fires me up, basically. So the place was running, you know, it just didn't have the. The main guy who knew how to do it all. So I hired managers that stole from me. I had, you know, one that got me into a labor law lawsuit, all kinds of things, until I figured out, you know, oh, all the vendors lie to you. They manipulate you. The restaurant industry is very brutal as far as just, you can't trust anyone from vendors to. I mean, you have to trust your employees, but you have so many systems in place. There's so much theft and things like that. And, I mean, I ended up putting 200 grand more into that location. I was every month writing checks to try to figure it out. Like, I'm not going to fail. I'm not going to fail. I'm not going to fail. I'm going to figure this out. And slowly started to figure out. But honestly, I reached the point where I drew a line in the sand and basically said, I'm not putting more money in this business. It has to stand on its own or it's going to. I can't. Because what was happening is I was hurting my original business, my construction company. I was borrowing money from it. I was taking all my profits out and putting in here I was. I would go to work from 8am to 4pm Monday through Friday at the construction business. And I'd go from 4:30 to midnight usually at the restaurant. And I just repeat it over and over and over again.

So I was just, are you married and have kids at that time or.

Luckily I wasn't married.

Okay.

I actually broke up with my now wife for a year during this period. Probably because I was so stressed out. Yeah, probably because, yeah, there was marriage on the table. I was like, I can't think about marriage. And actually that's when I got into this restaurant thing, but ended up going a few years of it, not making money. I never got a paycheck from it. And when I made the ultimatum of, no, it has to stand on its own, we have to make decisions on its own, it can't keep just siphoning off other businesses. We ran it and I reached it reached a point where with my bookkeeper, every few days we would sit down and go, okay, we need to make sure we have enough money in the bank account so we can cover payroll if we close today. Like, that's how close it got.

Yeah.

I was just like, I'm not putting more money in, but it made me get more scrappy. Go back to managing my marketing and just trying to figure out how to. How to work it, basically. It's hard to think back, like, what did I do that made that happen? My landlord helped me. Honestly, I reached out to my landlord. I was like, I don't know if I can do this, man. And like, can you put it on the market and start leasing it? And he's like, let's look at your books, see what we can do. And he actually helped me out with that. And that gave me like, breathing room to get to a point where you can't spend money on marketing because you have no money. So how do you grow it when you can't, you know?

Yeah.

So we ended up turning it around and it started to grow and I got married and we decided we wanted to sell them. And that's a whole nother story we can go into. But they were both in escrow. In about 2020, we decided that I wanted to exit this entrepreneur business thing and move out of California. And I was just going to take what I learned, take some of the money from my businesses and I want to start over. Not in a failed start over. Like, I've learned a lot. If I could start another business and apply all this to it. I think I could finally create that. That business where I'm not the center of it.

Yeah.

And then something happened.

There's something about. You were just saying, like, I don't know what the pivot point was, but there is something about when you decide to burn the boats and say, I'm burning the boats. This thing's gonna. This thing's gonna work, or it's not. And that's, you know, harkens back to the story of the. I think it was a military leader who said, you know, they land in a place where they have to win this battle. And, yeah, all the guys burn the boats because we're either dying here or, you know, but we're not leaving. There's no way we're getting out. And there's something about that when you take that so that you kind of plant that flag that. That allows you to. Your business to take off or your life. I mean, there's certain things that just is kind of that catalyst point.

Hey, Brian, when you were starting your businesses in the restaurant and as the entrepreneur, what was the toughest thing for you to get a handle on? Was it employees? Was it the theft?

What was.

If you're going to give advice to an entrepreneur to start a business, what's the number one thing you would. You would consider.

Yeah, I think for me, and it's hard to say it, but I know it's true. And it's the biggest thing I work on in every iteration. And even now they've had more of a breathing room. It's employee leadership. Honestly, like I've connected with employees that get motivated in a different way than myself is probably the biggest thing I have to focus on because it's come up time and time again when I'm trying to move the business forward. If I look back on. I don't know. You don't know at the time sometimes, but when you look back on it, because my uncle always said he owns a. Owned a business for a long time, and he told me stuff as a kid that I thought was stupid. And now I think back, he would always tell me, it's always your fault. And as a teenager, I worked for him on the side. He's like, just realize it's always your fault. And I was like, it's not my fault. UPS didn't deliver the package. I can't do the project that you told me to do. He's like, no, Yeah. I just realized if you take it as if it's always your fault. So when I come Back to this. Like, why can't I get employee to do something in motivation? It comes back to me and leadership. I guess because I'm motivated internally. Like, I don't need someone to tell me, good job. I don't need that recognition. I almost don't like the recognition. It probably comes from my. My dad and upbringing in the school we went to that just wasn't there. You just expected to perform. And. And I think I carry that over sometimes into employees and forget that it's not their business. They maybe aren't as motivated. They're, you know, they get the same hourly wage regardless of, you know, how they do. And obviously, I've changed. I've realized that pay structures can change that. Yeah. But the number one thing I would focus on, because if I go back from the very beginning would be just learning, reading as much as I could on how to connect with different types of employees. You need different types of motivation. And just realize that a lot of people I fired or let go or didn't work out, probably we could have made work. If I would be. Had been really good at that skill in the beginning. And even back to my most recent business, you know, I look back, go, man, I could have done a better job with that.

You know, one of the things that turned the light bulbs on for me back at graduate school, we studied a case, and do you remember Bobby Knight? Coach Bobby Knight from Indiana basketball? He'd throw chairs, he'd cuss his players out, and he'd win national championships. Then you got Coach K from Duke, and Coach K played for Bobby Knight, but Coach K at Duke is more cerebral, more mental, motivating, and et cetera. And he won national championships. So who's the better coach?

I guess it depends which ones match the players correctly.

Very good job. It is. They're both great coaches. And I fit more in the Bobby Knight camp than the Coach K camp. And so that goes back to the culture of the business. You got to hire people that want to play for Coach K. If you're a Coach K or if you're Bobby Knight, you got to hire people that work for Bobby Knight. And when we finally realized in our businesses that we have a culture, the business has a culture and a mindset. And, Brian, you probably had your businesses too. You had to find people that would match and fit in that culture. And in our case, you could be from Harvard mba, have a Harvard mba, but if you didn't match the culture, you were gonna fail here. And once we realized that, that helped us it didn't solve all the problems, but it did get us to start narrowing in and making less mistakes than hiring employees. Find people that fit your culture.

That was critical. That's so true. And the key people I can think with that really drove the businesses forward the most were the ones that matched. I would say my style. Instead of me trying to change my style and felt like I'm just kind of handcuffed in. Okay, like, we won't move as quickly. We'll go, we'll do their method. It's like, ah, it's hard for me.

To do that or even change them. You know, just find people who are the same way.

You can't change them. And, and the attitude has always been, you know, suck it up, buttercup, let's go.

And.

It'S tough. It's tough trying to change people or you change what.

So before we jump into where you are now in, you know, really in real estate, in, you know, self storage, oil and gas, and helping people generate passive income so they can get off the hamster wheel, what are some of the key things that you took away from your successful businesses that you would but also say, like, I failed at this thing within my successful business. What did you learn from those that you said? I'm implementing into this new thing immediately because I want to build it better?

Probably marketing, the number one thing. I realized that the very beginning. Marketing seems to be an afterthought to some companies, especially when they're starting, they don't have to budget. And I feel like income and sales can drive everything. You solve a lot of problems when you have inflow, basically. So I've spent a lot of time trying to learn marketing, for example, for this next industry I'm going into and doing it a better way and actually paying people that have done it before and learning from them. Honestly, I'm focusing on this business a little bit because it requires less employees. Restaurants, you know, restaurant I went from, you know, 10 or 15 employees, then my next ventures in the restaurants. I think we had almost 100 employees. And it's probably because of that leadership thing that I still need to work on. I'm like, I don't want to deal with trying to figure out how to lead 100 employees again.

Three or four. Fine, 300, 400.

Exactly. And honestly, I enjoy working with a smaller group of people that challenge me. I guess you would say, I think I miss that. When you put yourself in the middle of a business, sometimes you might sound. Might sound bad, but you feel like you're the smartest person in the room. And that's not always a great place to be. It's better to have other people pulling you along. So I think I really focused on when I sold all these businesses. I told myself I was gonna take six months and just not do anything. Just try to figure out what am I going to do for this next. Next venture. What. What have I learned from the last. The last venture? I really want something that honestly leveraged some of the money that I had made. And I wanted to work with smart people, if that makes sense.

Yeah.

And that, that's just for me particularly. I don't think I want to build another giant. Try to build another giant business. I don't think I need to. I think there's a better, smarter way I can do that. And what I focus on with my investors is the people that have built those businesses, they're in the center. Maybe they're trying to get themselves out of their center or not, but they're making great income. They can use it as a tool. So I go back to my, my dad and I look at other dentists, other surgeons, things like that, and doctors, and who are the ones that really built a great lifestyle. It's not the ones that became the best, fastest dentist that had the, you know, the most production. It was the ones who use that job. And they started putting in other things and other ventures. They bought a winery, they went to this business, they got into real estate. They used to just has a cash cow, basically. It produces a lot of money and profit. They didn't spend it all. And they built things around them that were just 100 passive that you literally couldn't be in the middle of. So I think I focus on those people more maybe because that's sort of where I came from. That makes sense. Yes. I did sell everything. I'm not telling people, hey, sell your business. Go do what I did.

Sure.

But I sold them. Yeah, I sold them partially because we. We moved states and I was in California. I just, I'm not doing California anymore. If I didn't do that, I would have kept those businesses and just use them exactly how I tell my investors to use them. Just use this money and plow it. Plow it into other things. So then you have multiple options. Like if you build the business and something you're not in the center of, you can sell it. Awesome. If a competitor comes and knocks you out of the water, you got other options as well. You haven't put all your stuff in one boat. So Many people are making great money in their businesses. They're kind of in the center of them, maybe halfway in and out. They got nothing else. That's their main job. If they lose it, they're not going to be able to go work for someone else easily. After a while, being an entrepreneur, I don't know if I could work for someone else.

Yeah, right. That's funny how that happens. Once you go out on your own, you're like, I've tasted the fruits of this side. I'm done.

Yeah. So I know if I answered that question, I sort of wandered around on that one.

That's good.

You know, Brian, as we talk to our investors, too, a lot of them or their paycheck is based on the number of hours they're putting in, the number of people they're in the dentist chair, and they keep going and going on. But, you know, God forbid, what happens if something happens? You're not able to absolutely do your craft, do your skill set and et cetera. And we always looked at real estate as the backup plan. Like you were saying, take some of the capital you're making, putting in something, put into real estate. So you get that passive income. And yes, it's not considered an insurance policy, but it kind of is. You're. You're diversifying your assets, you're diversifying your capital into something that hopefully will grow to the point where, if you have to say, I'm done being a dentist, you can live off your passive income. Are you. Are your investors thinking the same way?

Yeah, they. Almost all of them have hit a point. They're younger. I would say more 35 to 55, somewhere in there. And they're. They're cranking along like they're making good money. And there's the question of, do I keep putting in the business and try and grow it? That's how I can increase my income. They realize they definitely have a lot of eggs in one basket. They know they're too deep into the stock market, and they know real estate's the thing. I mean, I have a guy recently that he actually is another restaurateur that is making great money. And he was all into, I'm gonna do some single families. That's what I heard everyone else do. My realtor friend said, do that. And then he literally saw my stuff. And I've been talking to him for a few years that, you know, that's where I was going. And he pivoted and realized, you know, I can get basically equal or better what I would Deal with, with single family. And I don't, I just could write a check and someone else can do it. And he's like, yeah, let's just do that. And off he went. So I think if I look back at my first business doing that, home automation systems, we did a lot of stuff in Truckee and Tahoe, which is where a lot of tech money went. But also there's just a lot of business people up there. And all my successful clients, almost all of them had a business but then used it to start plowing money into something else. So some went into other businesses where they were passively involved. A lot went into real estate. And I didn't really realize that back then, but I was surrounded by people that were doing this. I just didn't really realize it. It's like, how are they? How's it, how's it a Wednesday and they're hanging out in Lake Tahoe and making money? You know, it's like, yeah, that's how, that's awesome.

I actually had a conversation just yesterday. It's funny how people even in real estate, like in residential real estate, they don't, they don't truly understand the benefits of, let's just say apartments. And he was trying to tell me why he loves residential real estate, which is totally fine. That's great. I mean if you're invested in real estate and that's where you choose, it's good, good place to be. I personally think apartments are better for multitude of reasons. But one of them, and I was explaining this and I could hear the light bulb click off, click in his head as I'm talking to him. But I was explaining how, you know, if you buy, you know, if you take some of your income and you just buy a couple single family homes, that's a great investment but you don't have a ton of control over the value of that, of that asset. Right. A lot of it is based on the comps in your area, what are they selling for? You know, you have a little bit of ability to increase its value based on, you know, the improvements you make. But it in an apartments you have a massive ability to control the value of it because it's, it's run like a business. The noi at the end of the day the net operating income is how the property's valued. And as I'm talking him through the difference, you could just again see the light bulb, hear the light bulb go off in his head. And I found that it's, it's surprising how few people actually Understand the, the dynamics of investing in apartments specifically and the benefits that you can get from it and the passive income that comes, the tax benefits and, and so on and so forth. But it's just educating our investors is where, you know, is our best marketing is just continue to educate the people who are, who've shown little interest in real estate.

And for business owners, I've found I've had, had that same conversation and I kind of have to go, I go, I start from the end. I go, you know, how is a business valued when you sell it basically? And they can connect with that. They go, okay, how would you increase the value of a business if you want to sell it? You can increase the multiple, you can increase the profit it produces. Basically, it's like apartments are that. And then we go back to single family. You know how single family works? Like this is why. And we explain that. And business owners really connect with that. They realize, oh, okay, because they like the idea of investing in a business. They, they like that. They just don't want to be involved in it. So if they can, if they can mix real estate with basically investing in a business, so you get the upside where you can grow the value of the business, but it's also secured by real estate in that market. I think that's what they're really attracted to because a lot of people are looking for that type of growth, but they have a business mindset. So they're always looking for businesses they can, they can produce. So instead of pumping the money into their business, pumping this other business, it happens to be apartments, but it functions a similar way of how we increase the value.

Yeah, well, I, so I want to hear why. So you've, you started with home automation, moved into restaurants, and we've touched on it briefly. But why apartments? Why did you get into investing in apartments? What was the things that you've pinpointed and said, oh, this is a great opportunity here. And then after that I'd love to hear also, why self storage? Why oil and gas?

Yeah, so I sold the businesses and obviously I got some big checks and then I'd have to figure out what to do with it. I'd never had a financial advisor. I didn't really trust them, honestly. But these were some big numbers. I'm like, I don't know if I should be playing the stock market with these type of numbers. So I went and met someone and got great advice, but still limited in what I could do. And he actually introduced me originally to oil and gas, but I was restricted to 10% of my net worth because of some phantom rule I couldn't really get from him and why I couldn't do more than 10% and just started to look into it like I'm going to manage this myself. I thought I didn't have time to do it. And then when I sold everything, I was like, I have plenty of time and I'm interested.

Yeah, right.

So I went and we were. We actually sold our house and we traveled around the country in a giant RV for year and a half. And during that I started leaving on weekends. My wife and kids, I find her a cool spot and I would take off and go to a conference. So I went to Rod Cleef's things. Just all these conferences. I was just trying to learn as a passive investor. Like I think real estate is a smart spot where I should put some of this. I've been kind of presented to it by a financial advisor, but it was too disconnected. It was through him and then someone else and just didn't feel I want to be more direct in where I invested. I just started going to conferences as an LP basically and then just started meeting everyone. I had never known anyone in the real estate industry. A few friends, dads were developers and it seemed totally out of reach. And then I realized everyone in this room used to be a business owner or some type of professional or something and then moved into it. I'm talking to the general partners. I was like, maybe this is the business I should do next because I've been looking into. I'm going to go buy some franchises. I'll buy a model that's already working and I'll just buy a bunch of those and run that and then I'll invest my money in other things and between those two, I'll have enough cash flow and I'll be good to go. How about more normal life with kids and a wife and just kept meeting these people. And I invested as an lp, going to more conferences and then I decided to just bite the bullet and join some masterminds again. Still to learn to see is this really something I want to do. And for the amount of money I was putting in and wanted to put in as the lp, if I could be more involved in my investment, that's. That sounded interesting to me because I didn't have a career, a job anymore. Like obviously if I had other business I wouldn't do that. So I just like the fact that it seemed like a lot of smart people. I. I like the asset class and I Like the business model, I, I mean all the businesses, I was like, you know, a lone wolf, like on my own. I didn't have a group of 200 people in a room. I could go ask almost any question about the business and they would tell me everything they knew about it. They, I was like unheard of. I was like this is amazing. Like there's a support system to it and a model you can follow. So that really attracted to me it to me as far as the business side and the money side just kind of followed and it's kind of, I was just going to invest passively and then I ended up stepping into it because I, you know, need a career and that seemed like the best career to fit all my needs. So maybe not the answer everyone wants to hear but, but that's, that's the fact. I, I, I love it. You mean I'm, I'm a numbers guy. I, I, I like that side of it. I definitely am not an extrovert. I'm a natural introvert. Yeah, I can turn it on for conferences and things like that. But I, I like getting into the details and I, there's a lot of things in real estate that just, I like and I, I look at just like another business when I sit in asset management calls and look at numbers and like this is so familiar. And it's great to just take my experience I have and tweak it now to fit and construction background is helpful a lot as well. I'm already adding a lot for the projects I'm involved in. Just having a lot of experience with contractors and subcontractors and calling people's bluffs and options B and C that aren't always presented when you, you know, you deal the construction industry. So yeah.

Hey Brian, how would you recommend to our listeners that are would like to get into vesting in real estate by themselves or become a GP or et cetera. How would you recommend they find these masterminds out there in the United States?

That's funny because I had someone else ask me that recently. They asked me to recommend a mastermind. I've joined a few, there's some I would recommend, some I wouldn't. All of them have their two day crash course boot camp, which you have to realize going into it, it's a sales pitch and you have to realize the sales pitch. Those are probably the best ways. I mean you can listen to podcasts, meeting people that are in them is definitely the number one thing. So when I went to these conferences, you know, it's like 99 bucks in a hotel room. And you go there and you meet people, but honestly, I'll go to the bar and talk to people that are already in it. That was the best information I got. Find people there and they'll give you a more true, honest answer of like, is this worth it? Is this not? What does it focus on? Is it focused on operations? Is it focused on, you know, just getting access to GPs and LPs? That's. That's an answer I'm still working on, honestly, because I started to be asked that. And I don't want to recommend a particular masterminder group because there's one I would would and one I wouldn't. But, like, have I been to all of them? No, I would say that you can just start light. There's online ones. Just realize, just realize there's a sales pitch and there's always an upsell and you're mostly paying for the room and the group of people. In my opinion, if you're just doing it as an lp, you can feel it too. I feel like when you go to these conferences, you can feel if you feel like you're being hunted, that's probably not the room you want to be in.

That's a great way of putting it.

That is so true.

But there's other rooms where people are truly interested and they'll talk to you just like this. Of like, yeah, we have deals and, you know, we like you to be in them, but they want to help you if you feel like, hey, how you doing? Oh, you're an lpo. What do you do? How much money did you make? Can I get your info? Okay, see ya. That's not the person you want to talk to. Yeah, yeah.

And there are so many masterminds out there right now. Everybody thinks that they're an expert and they're going to create a mastermind from there. But the masterminds that I really love are the ones that are the members are pay it forward, like you say, and you're not being hunted to sign up on. Hurry up, sign up. And the pressure's on. If you don't sign up, then whatever. I just tell people, do your research, get on the Internet there and, and why you can get on YouTube and watch some of these masterminds going on, but you want to be in an organization where the peers help you. And that collective mindset can be very valuable.

Hey, Brian, we've got. I got one more question. And after that we have a speed round where we just do quick Questions, quick answers so people can get to know you a little bit better.

But get your seatbelt on.

Yeah, super tough questions. No, the last question before we jump into speed round is for you. What do you want to be? So you've sold your businesses and now you're in real estate and you're. Because you're generating this passive income. And passive income by its very nature is supposed to allow you to buy back your time. Right. You want to not be working for your paycheck. You want your paycheck to be working for you. So what do you want to be doing with your extra free time that this passive income through real estate, oil and gas, you know, self storage is creating for you? What does that look like?

It's funny because I'm still developing that. But a lot of this changed when I got married and had kids. And it goes back to my dad. He made great money, took care of the family, but he left at 7am, got back at 6pm and there wasn't a lot of time around. And I have a good friend, actually I refer to that dentist friend for some reason I'm always surrounded by dentists. I don't know why.

Also, great investor. Yeah.

Yeah. When he had kids and they were young, he just started taking Wednesdays off and it cost some money. He didn't make as much. But he's like, you don't get those five years once and let's, let's do that. And I have a hard time balancing that because I'm always looking for projects, looking for things to do. So even when I have a bunch of free time and making myself busy so I have to be, be careful with that.

Yeah.

But I just really like everyone says freedom. Like I don't like being told what to do. I don't do good with an hourly job. I don't even do good with calendly. I don't like people being, don't be able to jump in my schedule. Like I want to schedule it when I want to schedule it. Yeah. So just having that freedom to be busy the way I want, I guess if that makes sense.

That makes total sense.

I like toys and we live on next to a mountain, so we have dirt bikes. You know, go do that stuff. My wife, we're homeschooling our kids so we're around that more.

Yeah.

I like working hard when I want to and then take a break. Like I, I like an unstructured schedule if that makes sense. When I'm feeling in the marketing mood, I'll go do marketing for 12 hours, but then I don't want to work for another day. And that that's when I shine the best, I would say, in my businesses. And I would say that's what I'm trying to now create. My original plan was to take the money from the businesses and just invest it passively and live off of that I could have, but not at the lifestyle I wanted, I guess you would say. So I'm finding a middle ground. We're going to take that money and we. It pays for a lot of things and then the rest of the time is just to build something great.

Yeah, most people, I think most people, when they hear passive income, all they think is financial freedom. Financial freedom. And I think once they start tasting passive income, they start to realize that there's freedom beyond financial freedom. Freedom, there's time freedom, there's choice freedom. Like, to your point, like, I choose when I work, I choose how I work. I choose how long I work, I choose anybody. I choose when people can actually get in my schedule. And I think that's a benefit to passive income that most people don't really consider until they get into it. But let's jump into the speed round. We're coming up on 50 minutes, so want to be respectful of your time. So again, quick questions, quick answers just for people to get to know you a little better. Do you have any daily rituals that you swear by?

No. All right.

Love it. Freedom of choice. What book has had the most impact on you? It could be long term or recently.

Oh, man. A while ago, it was the E myth that really opened my. My eyes up to, like, what my problem was. I didn't know the problem was I was like, I thought it was me. I thought I just failed and didn't know what I was doing. But the E myth for an entrepreneur that's. That's struggling with what's wrong, why I can't get myself out of this. Really opened my eyes.

That's good. What's one piece of real estate advice you'd give to people who are interested in investing?

All pro formas are all going to look the same. So you really need to look at the team that's running it and in my opinion, how well they run operations, because that gets you through downtimes and can be hidden in uptimes.

So good. That's a really good answer. All right. And we've kind of touched on this already, but I'll ask it anyways. So we talked about heading west. Is this journey through life some ups and downs, some flat tires, some top of the mountain moments. But at the end of your life, you know, kids are grown up, you and your wife are, are spending time in Utah. What does the end of your journey heading west look like? Do you have a sense of what that looks like today?

Yeah, I think so. I mean, we want to live in two locations. I want to not have to worry about business or income, which sort of there but farther along to where you can really do great things. And everyone always says this, but honestly not everyone has it. But really like family and retirement. I just want to be that cool grandpa that has, you know, dirt bikes for the kids and obviously we have, you know, a cool location somewhere on the beach or something in the mountains. But really just being able to have that and also help other family members along that journey, if that makes sense. That's great.

Well, Brian, I'm super appreciate, appreciate you coming onto the podcast where if people want to look you up, if they want to listen to your podcast because you have your own podcast as well, where can they find you? Where can they look you up?

Yes, my company's Passive Capital Partners, but our easy URL is just businesstowealth.com and my podcast is Harder working money because that's what I sort of originally am trying to do with the money I made is how do I make it work harder? Because entrepreneurs work so hard and I think they sometimes forget that their money really should be doing working just as hard as they do. And there's options out there that if you spend a little time, you can, you can do better than 7 to 9% in the stock market. But you gotta spend a little time figuring out where that is. So that's what we focus on. Hard working money.

Love it. Well, Brian, again, thanks for joining us and thanks for coming on and heading west and tune in next week for another episode.

That's great talking. Thank you. Appreciate it.