Why CoPilot is Basically Tesla - Episode 047

All right. Welcome back. Another episode. C Suite Unfiltered. It's been a minute.

We had.

We took some time off. You've been doing some more round or not Roundtable. Excuse me. Turnarounds.

Yeah.

So you've gone to. I don't want to spoil anything, but Arizona. Where else?

Last time was. And then Cincinnati was the second one.

Okay.

So if we do a two day, two business turnaround, like two businesses on one trip, then we were going Wednesday, Thursday, Friday kills the podcast. And then, like next week we're doing three businesses. So we're doing Tuesday, Wednesday, Thursday, Friday kills the pod.

So it's all good.

Keeps getting what it's probably gonna be like work every other week now.

Yeah, that's fine. You're a busy guy. So there's one coming out. Well, at time of recording today, you said it might not be the most exciting, might not be the most dramatic.

Well, the reason it's not the most exciting, it's actually the MO Has a really good story. And we'll talk about that in a second. But the reason I said that on the Mastermind this morning was because we forgot the camera. Well, the cameras got stolen, like, in this transit on that trip. So literally we were shooting with phones.

Nice.

So, but I think we. I think they captured the essence of what was going on. And, like, it was insane because it actually really caught, like, the employees literally coming into the office and, like, the car is bouncing and, like, not going through at Home Depot. And then it happened, like, multiple times. Like, the officers are like, oh, this is embarrassing. And, like, caught all of that on camera. And then, like, we went to the job site and, like, they hadn't called the customer, so the customer, like, called them off the job. Like, it was like, yeah, it was a lot of stuff. So that one's coming out. That one's from. I think it's Missouri. Okay. Somewhere out there. That was from a couple shows, like, travels ago.

And is that one going to be. You basically told the owners inside of Augusta, hey, this is like Must Watch. Not the most entertaining, but it's Must Watch. Why is it Must Watch? Give us the kind of the teaser.

It is. It is the result of getting distracted with other businesses. And what happens when the result of that and most time people point towards people are really successful. Like, oh, they did all these businesses. Like, no, they did one really big business. Then they went to a second one. Then they went to a third one. They didn't try to do 10 at the same time. And so he's trying to do real estate investing, hunting, his hunting business and lawn care and landscape at the same time. And really all of them aren't doing well. Gotcha. I should say the hunting one's doing the best and he should focus all his time on that. So literally this is the first time. And by the time, you know, people are watching this be out at the end, I literally, like, he should close the business down.

And I say which ones?

He should close the lawn care business.

Okay. Oh, wow.

He should focus on the hunting business because that's where his passion is. It's where it's already profitable. It has the most scalability. And he's like, let go this whole real estate thing because he's literally just using like, outside funding, like hard money loans, and like other people's money. And he's like, probably making 100 bucks a month on it, but all the time and energy, like, he's the sweat equity with other capital in. So he's like, well, there's no money in it. Yeah, you're making a hundred dollars a month. And so, yeah, you can, you know, get creative with your financing all day long, but you're giving equity away. And therefore the, the, the meat on the bone is not enough to warrant spending time buying houses. And he's managing all the contractors and all the rest. I'm like, you're literally probably making a couple hundred bucks a month.

Yeah.

So. And then people with real estate specifically, they're like, well, I'm building my long term wealth. It's like, yes, why don't we wait five or 10 years to so we can go buy 10 times as many properties and we'll build our wealth a whole lot faster. And instead of trying to like nickel and dime these little deals that are like, no money down where you have no equity, because, like, real estate's where the money's at. It's like, well, yeah, if that's where you always spend all your time, energy, and attention, you're probably gonna do a lot better. But if you're trying to do that and five other things at the same time, none of them are gonna work well.

Yeah.

And so I literally told him, like, he should close down his long care business. He should stop doing real estate. He should just focus on his hunting business.

Yeah, that was gonna be my guess too, when you said it, like, just. I didn't even know the guy, but lawn care, real estate, hunting, it's like, oh, he's probably passionate about the hunting.

Right?

And I could see that being split and I've. I've been in multiple roles as an employee of yours where I am clearly more passionate about certain roles than I am others. And so it's like, how do we incentivize that? How do you support me to get into more of a role that I'm more passionate about than a role that maybe, yes, I can do, but I'm not as successful. There could be someone better suited for that role.

I had some thoughts about that. Oh, good. Yeah, we'll talk about that. I was thinking about you on the weekend.

All right, thank you. Yeah, I was thinking about you too.

Well, since you brought up real estate, this is interesting. This also came up on a mastermind. I don't know what your thoughts are on this. I feel like people would probably want to know. This is from mortgage reports dot com. So Fannie Mae introduced a 5% down payment option for multi family homes. What are your thoughts on that? Because historically it's been you have to do 15 to 25% as like a minimum.

Right. So technically you're supposed to be wanting to live in the house for a year, 12 months. But again, with Fannie Mae and Freddie Mac, you just say you have the intention of living.

Yes.

And you're fine. Ye. And then the loan officer is like, yeah, don't tell me you're moving. Like, whatever. That's how it's treated now. There's certain limitations. However, when this came out literally last month, I was like, this is fantastic. I could literally go buy 10, four plexes.

Yeah.

And like that's 50% now. Like 5% times 10. So I would personally need about $400,000 to go get 40 units. That's a deal. Yeah. Now that sounds great in theory and it is good in theory. Here's the problem. Buying 10 different deals is going to take me a lot of time, energy and attention. It's not the 400 grand. It is the time and attention of wrapping up 10 different deals. That would be an absolute beast. Furthermore, that $400,000 spent on something like Copilot right now could be like. That leads to like a few more developers. Right, right. That leads to like an AI engineer that could. I could get and like the return on that in the next 12 months would be greater than what I'd make in the real estate in terms of cash flow for the next five years. And so everyone's like compounds and like real estate's more. More like stable is like. Yeah, well, my confidence level in Copilot is just as great, if not greater. Than the real estate market, especially in the short term. And if I can build in the short term my cash reserves, I can go buy the real estate later on. And so what my point was with the in the mastermind was like, look, these are great opportunities.

Yeah.

Like the, like Jeff Bezos said, he's like, something along these lines is like the level of someone's success is determined by how many great opportunities they can they turn down.

Turn down. Yeah.

Because that means that focusing on the greatest of those best opportunities and that's where the greatest returns are met. And that's for example with Luis and the turnaround show is like, okay, you have all these great opportunities. Yes. Real estate's a good deal. Yes. Your longer business has opportunity. Like obviously I believe in the industry you have hunting, like all this other stuff you're trying to do, like let's pick one and let's look. Let's look at the one that has the highest opportunity. And right now in the short term, it's your hunting business. Go make that way more profitable and, and then you can come back later on once that thing's kicking off cash and has a whole bunch of redundancy and delegation, then you build your lawn care business successfully without a whole bunch of debt.

Yeah.

And so in my mind, like this thing is a great deal. I think for anyone that is, this is like quote unquote, non Financial advice would be like, look at this deal as a fantastic deal. Especially if you can get fourplex that has some land and you do your business on that. Yeah, you could kick butt up here. A four plex, you're looking at a minimum of 800,000. Like minimum. That's a old junkie fourplex, you're looking at more a million plus for a four plex. Lots of parts of the U.S. 5, $600,000 will get you a fourplex. 5% down. You're looking at 30, 40 grand with closing costs to be able to be moving into a house, have three tenants and then have your shop space. That's a deal. Now in this environment, you're going to be paying with PMI and all the rest of it. Like high insurance, high cost of interest, like it's a lot. Your payments are going to be very high. You'd be very lucky to even just break even between the three tenants and paying off. Like you'd be very, like you probably won't. But the fact that you'll be able to live there and have it your business there, usually that can make sense of it. Even with the high interest rates. And then, you know, down the road, interest rates will come down. You'll refinance it like 4 or 5% versus 8 or 9%. So I think it's a really good deal for people, but I get concerned when people start spending time and attention on that instead of their greatest opportunity. And like, for an example, like this morning in the Mastermind I was talking about, like, I have to identify what are the one or two main things I need to be doing, and everything else needs to be delegated or let go and cut. And I'm just trying to do that myself because, like, that's what I expect of the franchisees. And when you join Augusta, it's like, you're not going to do your lawn care business and these five other things. You're going to focus on your lawn care business. And I did that for 10 years before thinking about anything else.

Yeah.

And so that's really what I was talking about this morning in terms, like, what are my two or three things I should be focused on? And everything else kind of goes by the wayside.

Yeah. It's kind of like the branching off of the real estate thing, but just opportunities in general. Right. You have. I feel like there's a lot of people fall into two camps and. And entrepreneurs are usually in this latter camp. The former camp would be the analysis paralysis. Right. There's so many opportunities, I don't know what to do. Sometimes I find myself in that spot where I'm like, you know, I'll listen to a podcast on, like, the stock market, and then the next week I'm, like, studying marketing. And then the next week I'm studying, like, sales. And I just, like, I don't know what I should focus my time and energy in. There's so many cool things I can learn, but I feel like entrepreneurs default to the latter. And that is just like, diversification. Fomo, fear of missing out. They're like, I have to do this. I have to try this. This is a great opportunity. The numbers make sense. Like, I must pursue this. The math adds up. And then you end up just totally diminishing the returns you could have had if you would have just stuck with one, maybe two things.

Yeah. Not all good opportunities are your best opportunity. And that is, I think, something that everyone should figure out. You'd rather be a employee or a business owner. There's always, especially in a market, we're kind of coming out of it now. But, like, especially the past few years when, like, everyone's hiring, it's it's tempting. The same way we talk about business owners for employees. Like, well, there's so many opportunities and everyone's offering a job. And so it's very easy. Like, okay, I can just, like, I can go from this one. And it's like, okay, let's think about 10 years from now. Where are all these businesses going to be? And are you going to. Is this the vehicle you want to commit to for the next 10 years? And I talk about all the time with business owners, but I'd say the same thing. The team members. Yeah. Typically when I say that though, it's like I'm talking to my team and it feels like I'm trying to like, retain them. So it feels weird. Weird for me to say that. But if I was saying like to any team member and be like, look at 10 years from now where this opportunity is. Because a job is an opportunity. It's an opportunity to learn, it's an opportunity to make money. And so you gotta like, distinguish, like, where's this opportunity going in 10 years? And is there enough legs on it for me to actually be engaged in it within the next 10 years? If not, then I look for other opportunities. Because the same way that I think most business owners think in terms of like the next bright, shiny thing, the same thing's true for team members. And so it's like, what vehicle you. Are you in as a business owner, what vehicle you're in as a job, and figure out what gives me the most latitude in the long term.

And some vehicles have better foresight or less speculation than other vehicles.

Yeah, right.

Like real estate. You know, there's been a proverbial bubble for what, three years now. So, like, what's going to happen versus, like, you know, lawn care, landscaping industry, like it is in high demand. Home services are growing. Like, I can grow the business successfully, have a good customer base. So it's just interesting looking at the levels of speculation down each individual route you could go.

Yeah. Like the. You know, obviously I believe in copilot, but honestly, when you look at like stripped down the industries, I believe that Augusta has much more stability than Copilot. Because copilot, I'm talking about software.

Yeah.

Like the most volatile thing in the world. Right. Then you have Augusta. Grass will always grow.

Yeah.

Leaves will always fall and trees will always grow. We will always be in business. And then you look at real estate. The reason it's so, like, stable is because, like, we will always need a place to live. Right. And so typically, with more stability, your returns come down that's why with real estate you're typically happy with 8, 10 12% returns over the course of time you know if you're lucky in a crazy good market yes it spikes 20, 30% that's not normal it usually goes like 2% a year in terms of the value and so the more stable industry typically your returns are less and that's why with software you can crush it and make all this money but like in 10 years that software could be completely antiquated with things like AI etc and so you know Apple will absolutely not be able to outlive a piece of real estate it just like it won't exist probably in a hundred years yeah and so yeah some yeah.

Yeah think about yeah I like that well let's let's talk about copilot I feel like it's been a few weeks obviously we took a week off and we haven't done kind of a deep dive so you have had some pretty expected unexpected growth recently a lot of people generally.