Businesses Cash Flow Better Than Real Estate - Business Multimillionare vs Real Estate Mogul

Money is energy, and you have to think about money like water. Like, if money's not flowing and money's just sitting still and it's not doing anything, it becomes stagnant, and then that's where all the rot comes in. Like, money needs to flow like energy.

Hello and welcome to another episode of Multifamily Strategy. I'm Christian Osgood, joined by the one and only Brian Lubin. This guy, I've had him on the podcast. I think you're the first episode of this podcast was with you. Back then, Brian's business was smaller than mine.

Today, I lied your ass off. You said that you were an established show. I thought you were an established authority.

I had established YouTube channel, first podcast episode, and it did okay. People watched it. There are humans who know who you are. Today, Brian has a bigger business than me, so we're gonna be talking about all sorts of things that he's learned along the way. Uh, we're talking about buying businesses, we're talking about cash flow, we're talking about different types of currency. This is gonna be a sweet episode. Brian, excited to have you here, man.

Yeah, first and foremost, oops, sorry for beating you, buddy. But, uh, yeah, guys, today we're going to be talking a lot about cash flow. We're going to be talking about the how it works, how it doesn't work, how most people have like no idea where they're even beginning when it comes to cash flow. Because in the conversation of investing in general, I feel that most people don't even know what they're optimizing for.

Yeah.

And if you just are honest with yourself about what you're optimizing for, then that's how you actually are able to make investing decisions. So most people are just like, oh, I want $10,000 a month in cash flow. Like that's where everyone starts. But I'm like, but do you really? Because there's so many different benefits and we're going to talk about like the different types of currency in this episode. Like you have, You know how much time you're spending on the asset. That's a huge thing. Your location. Is this something that you want to be boots on the ground for? Is this something that you want to be like geographically independent? Huge thing about deciding what assets you want to invest in and what teams you want to build. Do you care about tax benefits? The money that you make, you get taxed— you pay no taxes on.

Yep.

I'm paying Uncle Sam over $100,000.

Oh, that's—

yeah, that hurts this year. So that's a huge thing that you can like use as a benefit for real estate investing because when I had my real estate, I wasn't paying taxes on it because it's such an advantageous vehicle for that. And the last one is equity and appreciation. So then we can talk a little bit. I think people are unfamiliar with how equity, like forced equity and forced appreciation works across multiple industries. Yeah. So we talk about that too. So it's like there's so many different levers that you can pull for value add and that cash flow is just one of them.

And the first thing you said I think is the most important. If you are not at this point yet, people don't understand where they're going. They don't actually know what they're optimizing for. I hear this all the time and I think it's, you know, we're trained to add steps. People worry about skipping steps. Like you go to mentorships, courses, classes, meetups, get around people to learn the thing you want to learn. People try to optimize for this all the time. They're trying to maximize like, I want more money. They have this ambiguous goal. They don't really know where they're headed. And then they add a million steps to get there. Yeah. You run a company called Action Academy. You're around people, high performers all the time, multiple industries.

Yeah.

How many people have you seen actually succeed when they haven't actually done the first step of thinking about their freaking business?

Well, there's this quote that I really like, which is, vision without action is a daydream. Action without vision is a nightmare. Hmm. So it's two sides of the same coin. It's two symptoms of the same disease. So vision without action is a daydream is like that person that's just like, oh my God, it's on my vision board, it's on the lock screen of my phone. I'm going to be a millionaire. I'm going to be financially free. You don't actually do anything about it. Yeah. Flip side is a lot of people we know, which is action without vision is a nightmare. So these are people that are just grind or die, hustle 24/7. I'm working 80 hours a week. I'm not seeing my wife and kids, but I'm using the excuse of I'm doing it for my wife and kids to build this business where I'm not even seeing them as my kids grow up. And so it's just a huge dichotomy. So like everything starts with clarity. So yeah, we've helped. We did $212 million of acquisition last year throughout Action Academy. So that was across mobile home parks, multifamily, storage, land, and small business acquisition. So we cover a bunch of asset classes and there was some single family thrown in there too. And across all of these, like when people join, we have— and that's across 350 members, which is still about like at least a little over $1 million.

It's a ton of transaction volume for that size group.

Yeah. So at the end of the day, we— every single person that joins, like we start them, we like, we have to slow you down before we speed you up. And that's like the tell-all the tape for any single person that's doing anything brand new. It's like, first, let's set the GPS. Most people are just like, how can we take you where you want to go if you have no idea where you're going?

Perfect analogy. Perfect analogy.

So it's just like the first thing that we do is we stop and we ask them, you know, okay, what do you want? If money wasn't an object, like, what are you doing? What does a day look like? We call it the perfect day exercise. I'm like, it's a Tuesday. What does your Tuesday look like when you have nowhere to be, nothing to do, no one to report to, right? Because if people think about it, your entire life up until this point, you have never controlled a single minute of. Seriously. Yeah, it's insane to think about, but when you say it out loud, you're like, holy shit, right? So think you were born kindergarten, elementary, middle.

Yep.

Be here. Here's the school bus. Here's lunch. Here's home. Homework. Go to bed now, wake up here. Okay. High school, college, same thing. We look, we start to rebel a little bit in college and then they tack us back into place. Then you leave college and go into corporate America. Yeah, same thing. 8:00, you're driving to work 9 to 5, you're working hopefully. And then 6:00, 7:00, maybe you're hopefully home with your family, right? So when you become an entrepreneur, all of a sudden you have all your time back and now everyone's just like, what the fuck do I do now with this? But it's okay because you've— we haven't built that muscle. It took me a full year. A year after I left my job in March of 2022 to figure that out. And so it's not only like, what do I want in like, and how, but it's just like, now what are we doing with our actual day? Everyone says they want to travel, but I'm like, okay, but what's it just a random Tuesday look like, you know?

When was the moment that you realized that for yourself? You're like, holy shit, I haven't controlled a single moment of my life.

God, for me it was I was driving in Rome, Georgia to sell. I was selling uniforms. So I was driving in Rome, Georgia to this grease shop for this lead that we had.

I actually started in apparel.

Yeah. And they wanted, you know, so for people listening, like I actually sold uniforms to people that get dirty. So if you go to like a mechanic and they have like John on the, on the name tag, like that was me. And so I was going to this account and I was just like, holy shit, I've got so much more to do with my life than to get this guy's pants size. You know, and I was just like, dude, this is ridiculous. So actually when I was working that corporate job, that was the first time that I ever did my hourly rate exercise. Um, have you ever heard of that? So hourly rate exercise is where you take, like most people have a salary and some compensation and you have hourly pay and then you have salary, right? So when you earn salary, you stop thinking about how much your time is worth.

Oh, and you just go through how many hours am I working and how much should I actually make?

Yes, exactly. So it's just like, for me, I use the example of $80,000 just because what that's top of mind, that's a pretty average salary for most people. So $80,000, you know, divided by 2,000, which is 50 out, like 50 weeks per year worked with 2 weeks PTO, 40 hours a week, it's $40 an hour. So I was making $250,000. So I was like a little bit over $100 an hour was my time. Yeah. And I did the math and I was just like, okay, cool. So entrepreneurs are the ones that have these assistants, right? An executive assistant. I was like, that's for rich people. Like, wait a second. I did the math. No, back it up. I'm like, my time is worth $100 an hour in my job. I'm going to be the entrepreneur, the CEO of my role, even when I was in corporate America. So what I did was I was like, my time's worth $100 an hour. I'm going to go hire a virtual assistant from the Philippines for $4 to $8 an hour. 20 hours a week and I'm going to have them do all of my admin stuff so I can focus on what I— what makes me money, which is selling, prospecting, prepping, and presenting. Yep. That's it. And so I did that and I was able to make $250,000 in 20 hours a week. And I spent the other 20 to 40 hours a week looking at real estate. That's how I was able to get out.

Yeah.

Yeah. Because that's it, dude. People are like, where am I going to find the time to do all of this stuff that you talk about and teach? Yeah. And it's literally you just have like It's really simple. You have 3 sections of your day. You have morning, you have work, you have evening. You have to pick which one to optimize. For me, it was work. And I cut 20 hours a week so I could focus on real estate.

Dude, that is a fantastic method. And there's something that is really important here. If you actually want to do your freedom, you have to calculate, okay, what do I actually spend? You talked about the perfect day drill, right? So first you have to map out where am I trying to go? What does that perfect day look like? And how can I replicate that? Perfect day often, right? Mm-hmm. And you and I, we both have today pretty significant financial freedom. We don't have the perfect day every day, but fairly often we get to do what we wanna do more or less when we wanna do it. More or less.

Yeah. Well, I'll also say that you have like bumpers, right? Yeah. So it's just like, I like to do the type of work that I would like to do. So for me, like the mornings, I don't take meetings. Like I have no meetings in the mornings. It's from like 6:00 AM till noon. Like that's my day one. Like that's my first day. I count like 14 days in a week because I do the, like Ed Mylett is where I took it from. So I have my first day, which is 6 to noon, and then my second day is noon to 6. So I'm just like, okay, cool. This is all the time that I have for myself and to focus on my business and do whatever I want. Then my meetings, my podcast, everything, they're in the afternoon. So my meetings with my team, my meetings with anyone else, like my bookkeeper, my accountant, my lawyers, anybody that I'm doing a podcast with is going to be in the afternoon. Afternoon. And I do the same thing when I travel to Europe. I just flip-flop my availability. So people are like, how do you change your routine when you travel? Plot twist, I don't. I have it baked to where I can travel anywhere. Well, Asia I can't because the time difference is too much, but Europe is a 7-hour time difference.

Oh, there we go. And that, that fits almost perfectly.

So it flip-flops. Yeah. So now what I do is now I set the morning time on my calendar that's open. That's all of my meetings. And then the time after that, like in the evening is when I have my podcast and everything. So it's just like, I'm still able to have my mornings because America's asleep.

Yeah.

And now it's just, now instead of them meeting with me in the afternoons, like they're in US, they're meeting with me in the mornings. That's it. Yeah.

Super simple.

I know. And I can do that around the world and I keep the same schedule every single day, dude. Okay.

So one, that makes that super easy. Two, it's, it's applicable for anyone. Anyone can do that. Not that many hours to work. Yeah, pretty simple. It's like, okay, I'm working 2 days. I like working time myself.

I like working.

I like to work too. People, people, and people need to do that. You need to feel like you're moving forward. You need to be progressing, especially, you know, we're, we're not old guys. Yeah. Uh, we have a lot of, we have a lot of stuff to get done.

Yeah. And also you said something really important, which was people like go on the journey the wrong way. And so what I'd tell them to do is do what's called, uh, a, a have this clarity journey, which is directional, sequential, tactical. Yeah. So what most people do is they do it flip-flop. They do tactical, sequential, directional. So they start with the how, then the how fast, and then the where or the why at the, at the last bit. So I tell them to flip it, flip it on its head. So you start with the where and the why. So you're like, okay, so where do I want to go? It's like, okay, you know, so for instance, to use multifamily. So most people start with, I want to buy 100 doors. You know, I hear that and I want to do that in the next 3 years or the next 5 years. And you're like, okay, cool. So that's the, that's the how. And then that's the how fast, but why? So instead you flip it and you say, okay, well, I want financial freedom. I want $10,000 a month so I can quit my job, travel the world, do whatever. Okay, cool. Now it's how fast. So that's sequential. So you're like, okay, directional, where sequential, how fast I want to do in the next 2 years. Okay, cool. Now we use those 2 parameters to determine What strategy we want to pursue for the tactical. And then that's how you're able to actually do it the correct way. So now you have context to say yes or no to things.

And here's what it looks like. You can do this in one sentence. I'm not a big vision board guy. I'm not a big write everything down guy. But I mean, you can write this down on a notepad. You can write this down on a whiteboard for all I care. One sentence. I need to make X amount per month in whatever it is. In my case, real estate portfolio. For you, you know, if you buy in small businesses, whatever vehicle you you're passionate about. I need to make $15,000 a month in multifamily real estate so that I can retire my wife from teaching. You know, then share the vision. What's the significance? So that I can retire my wife, build my dream home, start a family. I spent 8 years in my sales career trying to get more money, and I bought like 2— well, and a single family— about like 2.5 rental properties. That was it. I was cash flowing like an extra $24,000 a year. I was making about $2.5 million or $2.5 million. That'd be amazing. $250,000. About what you were making in sales. And I'm like, okay, we have some passive income. I'm richer than some, but there was no direction. So in 8 years, I got like 4 rental properties. I wrote one sentence down, $15,000 a month within the next 2 years through multifamily real estate so that I can do X and Y. 2 years later, retired my wife. 3 years later, built the dream house. And then we just had our kid 3 weeks ago. Like, oh, the fast happens pretty quick, but it doesn't work. If you don't know exactly where you're going. Try driving somewhere without your GPS on, like go from Texas to New York. I'm like, okay, well, I'm probably going to go east and at some point I have to go north. Yeah, it's going to take me a long-ass time to find New York City without knowing where I'm going.

And here's, here's another problem that comes up. So then what happens is, and I made this joke to one of my team members the other day, because then what happens is you're used to driving with the fog, so you're driving slow, right? Because it's a windy mountain road and you've got all this fog around you. You can't see anything. So you're like, going at 5 miles an hour, you're like with the headlights, you're like this. But then all of a sudden when you have clarity, like the fog clears and you have like straight lane highway and you can just go and you're still driving how you're used to drive. And then you're like, oh my God, okay, now I know that I want to do multifamily. Now I want to buy a small business and I'm still driving the same. No, dude.

It's that same first to second to third grade mindset. I got to do one thing to do another thing.

Mash the gas. Go. And here's the thing.

Yeah.

To do anything in 2 years is fucking hard. And people need to— and people need to realize that they can't escape the hard by buying your program, by buying my program. We just help them do the hard stuff.

Yeah.

Like more consistently. That's it. That's what you're paying for. Paying for accountability.

And hard. Don't, don't mistake hard for it being complicated. I found it in every business I've been in. It is relatively simple.

Yeah. Simple skills, fancy fails.

Yes.

Yeah, yeah.

Simple but hard. It's going to be hard work no matter who you are. If you don't want to put in hard work, you know, put in lame work for 45 years at your 9 to 5 and hope you can retire. I mean, that's about the best you can do. But if you want to do something awesome in 1 year to 5 years, you're going to have to grind for it.

Yeah. And a big mistake that we made— so we help people. So Action Academy, we help people replace corporate with cash flow. So like our jam isn't like buy your first rental, it's like owner placed $10,000 in the 2 years, right? Yeah. So our mistake was year 1, we were teaching people how to do the thing. So we were like, okay, hey, like, come here, we'll teach you how to do self-storage. We'll teach you how to buy a business, teach you how to do mobile home parks, whatever. Yeah. Commercial, commercial and small business. Then I was like, wait a second, like people are having success, but they're not having success at the speed that I had success or that they should have success. I'm like, so you're ha— you're buying a 20-unit or something like cool, but Like, we need to get you to the $10,000. Like, so I was like, what's the difference? And I recognized the difference and it finally occurred to us this year. So that was Action Academy 2.0 was I was like, I need to get you to learn the things, but then build a team around it, build systems around it, build processes around it. Because I recognize that when you do business, business is the same, like at all scales. So the cool thing about business and investing. So when you guys are thinking about investing, it's the same as business. You're building and investing business. All right. So the stuff does not change. Yeah. Who does the stuff and at what scale is what changes. So for multifamily, you're still going to call the brokers, you're still going to send the mailers, you're still going to do driving for dollars, you're still going to do the same lead generation tactics that somebody that's in the hedge funds is doing. The only difference is they have different people doing it in a different scale. You still need to underwrite the properties. You still need to submit LOIs or in your case, PSAs. Yeah, you still need to conduct diligence. The only thing that changes is who conducts the diligence and at what scale. So maybe you're conducting diligence on 100 properties at one time with 100 people as opposed to one. So when you recognize that stuff doesn't change, then you can be like, oh, okay, so it's going to be the same boring activities, the simple stuff over and over again. I just need to get good at building a team and building a process whereby this is operating in the background without me necessarily being directly involved.

And I do. I love it when my money's boring. Yeah, I want it to be simple. If it's simple, it's repeatable. If it's repeatable, if it's scalable, if it's infinitely scalable, we're in a fun business. Now we can start playing the game and adding pieces and bringing in people. But I love how simple business actually boils down to. It is that, yeah, can we do a repeatable process? And if we can, can other people do the same process? And if they can continue to do that, you're like, oh yeah, in real estate, it's like, well, We're not going to run out of real estate. There's plenty of real estate to buy. No one can own it all. So it's like, let's go in. Let's— Yeah, take the field.

You know why people are stuck there?

There's a lot of reasons people get stuck.

They're addicted to dopamine. That's why they're stuck, dude. Because— because success is found in doing the repetitive, boring bullshit tasks every single day, year after year. And if you think that you can find an industry or a business that you can escape this, you're wrong. That is what's required for scale. And what most people do is they start the shiny, new, exciting, sexy thing and they're like, wow, I love this so much. It's so new and it's so stimulating. And then they start to have some success and then all of a sudden they hit the part called scale where you take it from 1 million to 3 million to 5 million to 10 million. Scale is doing the same shit that you're doing, but with other people, with systems and processes. Right. And now it becomes boring because now you're used to it and you're good at it. So what most people do is at that stage 2, at that level 2, they now go back to the new shiny thing so they can get dopamine again and stimulus again. And that's why they're not successful. It's not because they don't know what to do. It's because they're addicted to dopamine.

Yeah. Yeah. Oh, and that is something where people do this in jobs. Sales reps are famous for this. You know, being a sales guy.

Yeah.

You get a new sales job, you do really well. 2 years in, you find another sales job. It's not because you suddenly became bad at the job. It's like, I'm like, I hate going into work. I hate starting this job at zero every single month on the commission table. Like you hit enough of that and you're like, need to go do the next thing. I took like 6 different sales jobs in 8 years. I did well at all of them. They just got so repetitive and boring. Find something that you're mildly interested. This is one thing we, we talked about this yesterday. There's so many freaking ways to make money. Do something that you're at least mildly interested in. It doesn't have to be your favorite thing in the world. You don't have to convert your hobby into money, but take something that you wrote a book on this, funny enough. Take some of your passion. There we go. Find something that you're passionate about and make some money on it and build business around it. If you just try to make it, here's something I've seen people do. They're like, hey, I have a hobby. I have someone who's like, I'm really into flowers. So they made this flower lamination business. Business, it will never, ever, ever make more than $40,000 a year. Like the, the way that they're running their business.

Correct.

They're taking a hobby and it's now a job. And I guarantee you a few years in, that job is no longer fun.

Yeah.

Dipping dead plants in chemicals is like, it was cool in the beginning. I'm sure it's not like, boy, stoked to get up and ship another order. Right? Like it's a, it becomes a lame job. Find something that is scalable, that is repeatable. Real estate business, especially boring businesses, dude.

Correct.

I wanna talk about a couple of your businesses.

Yeah. You've told me about a couple where I'm like, I've got a mixture of boring and sexy, so I keep the stimulus while still scaling.

Okay. This is interesting. Which ones does one make you more money than the other?

Yeah.

Is it the boring ones?

No.

Really? Okay.

This is a surprise. Yeah.

Okay. What are your, what are your top, top 4 businesses? Cause you're, you're diversified over a bunch of stuff. Uh, as far as like interest to you and dollars made.

Okay, cool. So I'll start with, I want to start with an important point that you said really quickly. Cause I want to, I want to like, emphasize and clarify this. So I would start with your passion. I'd start with what's interesting. So like interesting and passion is completely different because if you start with what's interesting, then that's your natural proclivity to do something. So like for instance, I hate underwriting. You're interested in underwriting. Like you're like, dude, I like underwriting. Like I'm good at this. Like I can rock this. I would rather kill myself. Like, so it's the worst. So what you need to do is you need to find an asset and you need to find a strategy that's interesting enough to you to where you're like, I can do the boring stuff. This is so like mentally stimulated to me that I could do the boring stuff of this asset class for 10 years. Yeah. And for some people, like for 100 of our guys, it's land. They are obsessed with buying plots of freaking dirt off market and list them on the MLS and make it $30,000. They're obsessed with it, which I couldn't be less interested in land. So that it's different people and they love it. I couldn't care less about multifamily, but if you're telling me I could buy a kitchen hood cleaning company and have equity in it, I'm like, dude, sign me up, brother. But that's the thing. So you asked about the businesses. So yeah, I would say that something that's very important is you start with the passivity, which gets you out of your job, which then allows you to make your profit from your passion. So start with the passive, boring stuff first. And then so I had co-living rentals and I had a podcast affiliate business. That's what that was like my passive income. That was my $20,000 that got me out of my job in March of 2022. And we talked about this on the previous podcast. Then after that, now I'm in my passionate income because I wasn't relying on my passion to survive. That was already coming. Yeah. So now I'm like, okay, now I can build this big old business where I don't need this income. Like, I can build it how I want to and in a really fun and passionate way. And because you don't care about the income of your passion, that's when you 10x the income of your passion. So my most profitable business is Action Academy. So like my most, like my baby, like that's what I spend on, which you are really passionate about. Correct. But I was able to do that because then I ended up selling my real estate and selling my rental. So I was pocketing like almost $300,000 of cash in my bank account post-tax, post like realtor fees.

Yeah.

So that I could have that cushion to start pursuing my passion. Right. So what I do is I started with my— so I started with the passive, then I went to my passion, and now I'm taking the profits from that and I'm putting it back into boring. Does that make sense?

That makes perfect sense.

So now I'm— now, now I have too much invested in my passion. So now I'm redistributing the wealth into these little like armies and these little vehicles because everyone says millionaires have 7 streams of income. But I'm here to tell you millionaires, the deca-millionaires, have one big-ass business that they scale to $10 million plus, took the profits from and redistributed it into passive streams. Yeah. So now I buy about a business a quarter. So I'm buying 2 businesses this quarter in Q4. But now that's like my, my goal here upcoming. So right now I've got Action Academy, I've got Sexton World, which is our travel company. So we're at about $1 million there. We're at like $829,000 in revenue, about 15% profit margins.

Wow.

It's like 50— it's like 16 to 17% profit margin.

That's not bad for that type of company at all.

No, it's, it's something. Yeah. It's like it's not designed to be a profit center. It's enough to like have me a little bit of money and like have my people. So that's, that's our international events. We do like huge events. We just did a $300,000 Tulum event that was super cool. We're doing like excursions and stuff that like we want to rent a superyacht in the Mediterranean this next year, like stuff like that.

Okay. Yeah, you can invite me on that one.

Exactly. So then we go from that. Now we have the kitchen hood cleaning company, which is a Hoods franchise. So I bought that with one of our partners in Action Academy.

Yeah.

Bought that for $900,000. I get $4,000 a month from that in passive distributions. And we could talk about how I negotiate businesses because how I do it is a little bit different than how other people do it. But we can talk about like the different parts of the deal triangle there. And now I'm buying a gym franchise with another partner, another operating partner and his wife. And so we're going to open that up in Nashville in probably February or March 2025. Yeah. And then that's going to be a whole other thing. We're buying that for $500,000. $1,000,000. But most of my businesses that I buy, I'm targeting between $1 and $2 million.

Now gyms are quite competitive. Does that fall for you on the passion side or on the boring side?

That one's more— that one just sounds cool.

Okay. I figured that might be— I like the hoods. Makes sense. I see how you would make money. You're doing service. You're cleaning a hood. It's unique. It's boring. It's simple. Gyms. There are a lot of people who are passionate about gyms.

Yeah. So the gym, the gym we're doing because I get to write a check and then get 2 of our Action Academy members out of logistics and into like their lifelong dream, which is to open up like a fitness franchise. Yeah. So that's sick. And I can be able to do that, which fuels all my businesses, fuel each other. It's all vertical integration. They all like have some way, shape, and form that they're tied together. And that's the best way to build businesses.

100%. And that's why people have multiple income streams, by the way, more than, more than just the investing. It's like I have a real estate acquisition company. That's where I started. I'm like, I have a proclivity towards being able to buy real estate without money. Like, this makes sense to me, right? So we did that. Then I started a property management company because I'm like, people are not optimizing this the way that I want it optimized. So now I have employees, I have control over my people, and I can subsidize the cost of having great people by managing other people's buildings. That makes sense. Multifamily strategy comes out of that because I'm like, we did something that a lot of people want to do in a way that was really effective.

Education.

Yeah, we do it. And then it's like, wow. We're doing all this stuff. I'm paying sales and marketing people a ton of money. Why don't I just bring it all in-house? And now we have a sales and marketing. But it's, it's not like I went out and said I need 4 streams of income.

Correct.

And it's not like I recommend starting 4 businesses. It's just the things that we were doing were monetizable and they became their own profit centers. And like, well, now we have 4 because it was needed for you.

Yeah.

You're already doing travel. You're already doing events as part of Action Academy.

Correct.

It makes sense.

And now it's all write-offs whenever I go and travel. So like when you're an entrepreneur, you can be proactive about what businesses you build around what shit that you enjoy. Yeah. You know, so I'm like, I'm going to— I want to go do this anyways. So now we're like, okay, cool. Like, how do we build a business to where like I can point to this for my CPA and the IRS? I'm like, no, this is actual regular use right here. So yeah, the gym business is more— is more so for fun, but it's still advantageous to me from a cash on cash.

Yeah.

And all the businesses that I buy are all like marketing for me, for the community itself as well. So it's just like it's a really high cash on cash, really high ROI. But how I think about things is I've got my, my podcast is in the center of everything and this is how we're going to do $50 million a year, by the way. It's just going to be like a 10-year play. So I've got the podcast in the middle and then I've got the community, which is like our vehicle. The mastermind is the backend business of the podcast. Through the mastermind is where I source all my operators and all my capital partners. So that's Sexton Capital. So that's my, that's my like private equity group. And Sixty Capital is what goes and buys all these other little companies. So it's going to be companies that are both vertically integrated with us and also that my people are wanting to operate and run. So it's just like, it's the best of both worlds. So we're going to probably buy a bookkeeping company, a virtual assistant company. If you guys are selling a virtual assistant company, I want to buy one. Um, so something like that, like tax prep, legal strategy, all this different stuff, like a CPA, like online CPA firm. Like I'd love to buy that.

I'm going to take, I'm going to integrate bookkeeping. I want to buy bookkeeping. Into PM. That would be so valuable for me.

So that's vertical integration. And then we have the travel company, and then we have events and conferences, and then we have our hospitality company, which is where I'm going to buy boutique hotels. So that's where I'm going to take all the profits. I'm like, okay, cool, I've got so much cash coming in that I need to dump all this into commercial assets so I can do a cost segregation and be able to wipe out, wipe out all my taxable income. So it's just like, for me, it's not as advantageous for me to go and take on a bunch of investors and buy hotels today because now I'm a GP-LP split. Like, doing that isn't as advantageous, whereas it's more advantageous for me to build up these profit vehicles and for me to dump $2-3 million of my cash into, into a hotel.

Well, and as a hotel owner, if you, if you went in early, GP-LP, where you're part of the operating team, yeah, that's going to be a huge distraction for the rest of your business. It's going to pull you away from the center, whereas if you come in in a more limited role where you're like, hey, I'm playing the investor on this and it plugs into my business, the same exact asset can be an asset instead of a liability. Yeah, depending on when you buy it and how you structured your deal.

So let's talk about that because it's the same thing with multifamily, it's the same thing with storage, it's the same thing, mobile home parks, it's the same thing with businesses, the deal triangle, right? So you have money, knowledge, and hustle.

Yes.

Like that is it. That is what's required. So like right now it's like anybody that's listening to this that has zero money, Like you start as the hustle, like that's all you have. So you're either going to hustle to get the money or you're going to hustle to get the knowledge. So that's a game that you have to decide what you want to play. So like for me, I was like, okay, I want to hustle to get the knowledge. So like, so I paid for my knowledge. There's two ways to get knowledge is pay to play or seek to serve. So you're paying in one way or another. You're paying with your bank account or you're paying with your time and your sweat equity.

Yeah.

Period. Full stop. That is the only two. Those are the only two ways to get knowledge, which is why you have to understand how much your time is actually worth.

You have to do that original math we talked about right at the beginning and know what your time is worth so you can make the investment. Am I trading my time or I trade my money? What am I getting a better return on?

Exactly. And so for me, I was already making a quarter million a year. So I was like, I can't trade my time. I need to trade my money. So I was paying $5,000 to go to a weekend full of millionaires at this mastermind event. I was like, holy shit. You know, and I started just investing in the coaches, investing in the mentors, stuff like that. And so that's how I was able to gain the knowledge. So I shortcut it. So that's every— like them doing your thing, them doing my thing, that is investing into buying your years of your life back. Yes, that's it. You know, because all the stuff that we do is online. Like we put it all online for free. Yeah. So you're just paying for somebody to hold your hand, kick your ass, and hold you accountable to it. Yeah.

To move faster and to make less mistakes. Those are the two reasons that you would get into a community or a mentorship or any of that?

Bingo. Risk mitigation.

Yeah.

It's just like to avoid— so to get in the game and to not get wiped out of the game.

Yes.

So level 1 is how do I get in the game? Level 2 is how do I stay in the game? Yep. That's the— that's it. If you just stay in the game of real estate and business, you will compound. Yes. So in the beginning, you're the hustle. So like, that's just what you have to do. You have to be the person that finds the deal. Yeah. Like, so if you don't have capital, you have to be the person that finds the deal. Yeah. So That's what I used to be. And now I'm the capital side and the knowledge side. You need two parts of the deal triangle to be really lethal in the game. So now I'm the capital and I'm the knowledge. So somebody comes to me and they're the hustle and they find businesses and they're like, hey, like I found this business, I'm under contract. Here's why, like we should do it. And I help them get the knowledge because they're in my community. And I'm like, okay, cool. I'm going to fund it. So you can buy this $0 down. Like I'll, I'll cover the SBA.. And so I'll put the down payment and then I'm a passive partner. So I'm anywhere between 15 to 19% of equity of these businesses. So I'm off of a PG and like I'm either a completely passive partner or I'm a slight, what's called growth partner. So I'm somebody that's coming in and helping them a little bit on the sales and marketing side. Maybe we're doing a monthly call, but to your point exactly, it's so I can focus 100% on my business Action Academy and only keep my focus and my attention there on my team of 6, an extended team of 12. So I can build that vehicle up to the $10 million plus and then redistribute those profits passively. So now all of a sudden I pick my head up, I've bought like 10 businesses over the next like year, and now I've got freaking $300,000 of distributions coming in on top of my income that I've got. Yeah, that's how you do it.

It's, it's when you listen to it, and this is pretty much the story for every entrepreneur I've ever heard, like anyone who's been successful. It looks pretty much like that. Literally, that is the flow. You pick a direction, but you don't pay attention to 90 different things. No, no, you do not jump all over the place. You focus on the thing. You make the main thing the main thing. As you scale, you build it around a central thing. For you, you're like, I have a podcast and the central profit center is Action Academy. Like, we put people in a great community. So you focus on the quality of the paid output. You're like, okay, this generates the money. The podcast feeds everything. This stays at the center and we build around it and you build around it. You mentioned one thing in here. You said your 6-person team and the 12-person extended team. Is that the other 6 people that the 6 people on your team manage? Is that— is it 2 layers or what is that? What is extended team?

No, it's just people. So I've got 6 people that are like full-time. Yeah, that like they wake up and it's Action Academy. Okay. And then I've got 6 other people that are like high-level coaches and mentors that they're like they're still building their own businesses, but then they're also like a part of Action Academy. So that we call them ACEs, asset class experts, for each one of the different strategies and different asset classes that we have. That's good. Because for me, I can't— like, my time, I can't— like, my business is not me teaching. I'm not the guru. Like, we have an entire community and staff of coaches, mentors, and like different tiers of people that are coming in and helping people. So it's just like, so we have to have that infrastructure so they have interests and incentives to be involved with that. And I make it like a very, very much so a win-win situation for everybody.

I'm always hesitant to use a church analogy because people are like, oh, then Brian's thing's a cult.

Is it? Oh, it's a cult.

It's a cult.

We only sacrifice goats every other Tuesday.

Oh, see, and that's not as bad as most. No, I'm kidding. But when you put this together, so is this something that you see in churches all the time? Perfect parallel. Churches with a celebrity pastor. It lives or dies by the pastor. The pastor screws up, the pastor does something irresponsible with money, something happens, the entire church dies. We saw this in a church in Seattle called Mars Hill.

Yeah.

Where he used money from his book sales, but he used the offering money to promote his book that he owns. Shocking.

Yeah.

I was like, whoa, no way.

That's a bad idea. Or you catch him cheating on somebody in the—

which, which actually seems to be the more common one, right? It's always one of those. It's always sex or money. Yeah. But you have a celebrity pastor that these churches will blow up and then they die, right? They live or die by one person. But when you have these churches that are like, hey, we really invest in having like a wide roster of people, there's not like one central person, we have a ton of accountability, you end up with these like really healthy, long-lasting groups that do really, really well for a long period of time. And business turns out it works the same way when you— and I recognize that I am the central person in my business. So there's a core weakness in my business.

You're the celebrity pastor, dude. Yeah, it's gonna be money or sex, dude. It's the base of the pyramid.

Of the two, it would have to be money.

Yeah, it's the base of the pyramid. Oh cool, sorry God. Yeah, no, but seriously, it's the base of the pyramid, literally, to where it's like the more talent that you have at the base of your pyramid and the base of your structure, the higher the structure, the higher the pyramid. Yes.

And you're the bottleneck. And there's two mistakes people make with the base, by the way. The number one and the most common one is people get so excited about, I want to be rich now, that they build their whole thing on a tiny little base. They build their pyramid upside down. They go, I have no base at all, and we're just going to go out. And that tips over. Or also common, they spend forever on the base, which is what I did. 8 years of like, I just want to invest. I'm going to read this book. I'm going to get in this group. I'm going to get in this group. I'm going to take this course. I'm going to show up at this meetup. I'm always there. And you see the same person 5 years later and you're like, you are a quarter of a step farther than you were when I met you.

I would actually push back on that and say that that's not even building the base, that you haven't even set a rock down. Oh, like, so here I'll show you. That's true. Here's an example. Here's what building the base looks like. Yeah. So if you're building your base, what that would look like from— I'll say from my perspective and then I'll say from somebody that's listening, that's an investor perspective.

Perspective.

Yeah. So from my perspective, building our base would be taking the time to say, hey, let's not do this because we don't do any paid ads. So like, let's not do paid ads, keep our organic marketing so we can keep it low and slow for our member growth so that we can really focus on the backend infrastructure. So my— who needs to be in what seat? Like, how do we juice up support here? How do we juice up onboarding? How do we juice up— like, what are all the core issues with the business? Like, let's make it really, really foundationally and operationally sound. So that we can support 1,000 members before we even introduce lead flow from 200 to 300 to 500. Same thing with multifamily. You build out the systems for 1,000 doors while you're at 100. Yes. So that way you're not stair-step— now that way you're not doing this crash and crash and crash thing. You already are proactively hiring the staff and building the systems and SOPs so that you can just more gracefully, like, climb the growth curve. So that's what building the base looks like for me. What it looks like for an investor is somebody that's just like, okay, so I'm going to build my base by— I'm going to have— I'm going to start like with clarity. I'm going to be crystal clear about what I want and where I'm going. I'm going to be crystal clear about what team I need. So this person is going in there, they've got their attorneys, they've got their legal team, they've got their tax team. They have all the people that are required for them to actually pull off a transaction. Now they're getting their brokers. Now they're like, okay, cool, I'm going to go talk to my brokers. Now they're building their buyers list. Like that is building a base, like they're getting their capital partners. That's actually what building a base looks like. So that when you start going all of a sudden, and that's why community rocks. Now you can just condense that timeframe and you have all these different people, emphasis on people in your corner. And now that's where you see people buy 100 units in a year because they had that base core group of people established instead of just being like, oh, I'm going to figure it out by myself. Oops. Oops. Ah, oops.

And like, and like all things, there is a middle ground there where I do see people get stuck as they focus on like, I need to build out my entire team. I need to have my—

Oh yeah. And they don't even send an offer. Yeah.

And I'm like, the first step— I say this about real estate all the time. It's true about business too. If you want to be a real estate investor, you do in fact have to buy real estate. And people need to hear that.

There's like the number one thing where I'm like, you don't need to get your real estate license. What? Don't get your real estate license.

Selling real estate for other people isn't the path to buying real estate.

It's like none of them own real estate.

And you hear it all the time. People are like, well, I haven't got my license yet. I'm like, oh, thank goodness.

Don't. Actually, Christian's lying. The best way to buy— the best way to be a real estate investor is to make a course on real estate investing.

Oh my gosh.

You don't have to buy any.

And have we not seen enough?

You don't have to buy any real estate. Just make a course on real estate.

The amount of— especially in the last— I want to say in the last 5 years, Yeah. The amount of people driving up in a Lamborghini, not at a property. Yeah. Just in a Lambo, in a Cybertruck, on a yacht. Let me tell you all the secrets of real estate. You know, the first rule of real estate, there are no freaking secrets. There are no secrets. It's a simple business.

Yeah.

Oh, sticks and bricks. There's a— I won't name drop them because I don't want to get sued, but there's a certain individual who really loves pushing Section 8 and he's very much 'Look at my yacht, my $20 million house, and look at my—' I'm like, 'I've never seen you at a property.' One name of a famous actor.

Yeah.

What? No, I'm sure that's not him. Yeah. You see these people online and you're like, 'You are spending all your time and all your money at your mansion talking about doing a thing that we haven't seen you do.' Yeah. And then people call later. So then people join multifamily, like, 'Oh, I've been burned by a course before.' I'm like, 'Did they teach you anything?' No. It's like, Of course they didn't. Where did you see them? Well, I saw them in the mansion I wanted to own. I'm like, did you see them at the property you wanted to buy? Hell no, you didn't.

And then it's $20,000 later, they give you the exclusive opportunity to be an LP in their syndication.

That is my least—

okay, so you're a real estate investor now. You're an LP. Being an LP— look at the camera— being an LP is not going to get you where you want to go in the beginning. You need to be the GP of the deal. That is the only way. The only reason you should be an LP in a deal to get started when you're starting in real estate is so you can learn from a GP that you're being mentored by and you're putting skin in the game to show them that you're a serious mentee candidate and you watch what their communication structures look like on the back end so that you can do that as a GP on the next deal.

And even then, I usually put that as a JV structure where I'm like, if you want to learn, let's do a deal together. You, you have skin in the game. You have a few roles like a business. You know, not everyone can be in the driver's seat. So if I'm working with someone on a deal and they're like, hey, I have the money, I want to work with you, but I want to learn. That's usually who I partner with. I don't partner with people who are just like, I got money. I'm like, we're going to do this together. We're going to do this team. You have someone in the driver's seat. You have someone who recognizes it's on your operating agreement. I'm the capital partner, but they have certain responsibilities and roles where they can't just sit there and not do anything. If you want to learn, learn. You will never learn. I don't believe that you ever learn as an LP in a deal significant things about real estate. It's passive. You're not held to any standard of learning. This is the worst funnel online. I'm going to get flack for this because a lot of people make their money this way. They try to get you to buy a course on something that they've done on the real estate they bought, but they bought the real estate from their course and the money from the course and the people in their social media market. By the way, I don't partner with mentees for this reason. I have my huge conflict of interest, but they build a platform first and they usually fake the platform. Then out of the platform, they start buying deals. And then they go, look at all the real estate we bought. But you could never buy all this real estate once you're in the course. That's the, that's the secret. You can't buy Class A real estate in, you know, downtown Miami. You can't do this. Yeah, but I can. So if you give me your money, I'll give you, I'll give you a little teeny taste of the wealth. Yeah. And then you fast forward 10 years later, they're like, I manage billions of real estate. I'm like, you never did the thing. And they don't lock their interest rates. So then interest rates spike and they're bleeding money. They're doing capital calls. But what happens?

They're marketers, correct?

They're going to— now, now they've already made it. So it's, oh, guys, you know, hard market right now. You know, that's really hard. We're expanding in all new deals and it's going to be better. Look at the billions already bought. It's like, never mind the fact that the billions they bought are bleeding money.

Who cares about that?

Who cares about that? They own real estate that you don't own. It's the biggest scam in real estate. And I assume this is probably true over every asset class of business.

And being an LP is— you don't be an LP for cash flow. Like, that's— no, like, the only reason you're— I'm an LP in 3 deals. Yeah, I couldn't tell you, like, I don't have expertise in the deals because I'm a member of the deals. I've got $150,000 in 3 different LPs. Yeah, limited partner. Yeah, exactly. And so I do it for tax benefits. Benefits. So that's the only way I'm able to get rid of any of my money. And I still owe $100,000 to the US government. Yeah. So that's a good, that's a good problem to have. Yes. But I mean, I digress. So I mean, people just are like, oh, I'm going to invest as a limited partner and then that's how I'm going to get my cash flow. No, that's not going to help fix that problem. Yeah.

Bingo. Yeah. Cool. You don't pay the government. That's ridiculous. No, one of my first years. So this is a fun thing with creative finance. So you have accounting nerds, you have internal and external basis. If you buy all the deals, no money down. So if you raise all your capital, you creatively financed everything. I hit a point where we got a ton of cost segs. You have a ton of write-offs. Turns out you can't actually claim more than your basis. It goes on your taxes and it rolls to future years. I couldn't actually use it. So I had like a million dollars of write-offs.

But you can defer to the next year.

I was able to do it in the next year. But for that tax year, that first tax year when I was like starting my business, when I really needed cash. I did owe a couple hundred thousand dollars that I was like, but wait, I have more write-offs than I have taxes. They're like, oh yeah, you just can't use them. I was like, oh yeah. Uh, which, which comes to building the right team. You were talking about building the base. There would've been a point earlier in the year where it's like, oh, you know when the right time to get the CPA was? It wasn't before I bought a deal, but it was like immediately after I bought a deal. It's like, we should probably figure out the tax ramifications of making a lot of money.

And don't go cheap.

No, no, no.

You need this on your bookkeeper and your lawyers. Like, Anything that's covering you or under you, spend money on. Yeah. So that's, that's your— that's your clothes. I mean, I guess we don't need to use clothes because I don't spend much money on clothes. But from a coverage perspective, from your CPA, from your bookkeeper, from your lawyer, anything that's under you is your shoes, your bedsheets, your shoes, your bedsheets, and your tires.

This man just spent a lot of money on bedsheets.

I'm trying to justify it. My passive income isn't that much.

You got a sick place, by the way, in Austin. Yeah, dude.

Beautiful view, dude. Let's talk about that. Yeah, that was an investment. So it's a $1.5 million condo. I was going to buy it, but then I was just like, wait a second, I want to keep that cash to buy businesses. So I actually made the decision to lease it, which I see a lot more people doing now. A lot of people that I respect that are much richer than me, they're like, dude, I'd rather pay $20,000 a month to lease my big-ass house and keep my cash with today's interest rates.

I was going to say, especially in today's market. Yeah.

Completely different situation back when interest rates were—

when money was virtually free. Yeah. Borrow it.

Completely different. That money at that rate was an asset. Yes. Fixed-rate debt, 30-year term, 2% to 4%. It was 4% for commercial. Yeah. But that was an asset that you're holding. That was like literally just an arbitrage play. But for me, Uh, somebody said something to me that just changed how I thought about things. And so, uh, for me, I was investing in traveling. So I do this thing called money buckets, which is I bucket my spending into different categories and whatever categories. And I like, I put scores to them to see which ones make me the happiest. And so I'm like, okay, here's food, here's travel, here's hotels, here's cars. Here, like anything. And so for me, travel and hotels was like by far my biggest bucket. So I spend lavishly there, cut ruthlessly from all the rest of the buckets. So that's how I'm able to like, I'm actually not spending that much money in relative, just most people are spending a lot of money on leaky bullshit stuff that's not actually bringing them happiness. I don't at all. And so I spend so much money on travel. And one of my friends was like, hey man, like you're traveling around the world 24/7. So for people that are unfamiliar, like I travel like 6 months out of the year, like Europe, freaking Asia, South America, Brazil. And like this summer I was in Europe and they're like, why are you spending so much money on travel but you're not investing in where you live? Have you ever thought that maybe you're traveling so much because you're trying to escape where you live and now you've got a bunch of half-assed relationships all around the world instead of just staying tight and like actually building a relationship that you want? Like both romantically and also with friends. Yeah. Like in Austin, I was like, oh, okay, so then what apartment would excite me? So I took action really fast. Yes. Action Academy is my literal entire brand. And so what I did was I was like, okay, in the next 2 weeks I'm going to find my dream apartment. I'm going to go book it. Yeah. And so I went toward like 12 different apartments, 12 different condos, found one that was halfway furnished, and that's got a perfect sunset view panorama of Austin, Texas, right on the river. And I got it for $6,000 a month. So I'm super excited. But that was a huge jump for me, dude. I was paying $2,600 in rent before that. So I went from $2,600 to $6,000 in the very beginning. Like, it made my butthole pucker. I was like, oh, but anybody that's listening in New York and Miami, they're like, okay, brother, it was only $6,000.

Are you kidding?

Yeah, it's only $6,000. Um, but yeah, dude, so I invested heavily into where I live and now I am like a week into it. And I already like, great investment. Love that. Great investment. And well, and the fun thing, it doesn't make me money though. Yeah, great investment.

But the thing is, you waited for that, you earned that, you went through, you did the grind, and my distributions cover it. Yeah, yeah, you did it. There's 3 types, in my opinion, there's 3 primary types of money that you need to hold to be rich. Like you can be wealthy, If you have a bunch of equity, but if you have no cash flow, you're going to lose it. You need cash flow, you need liquidity, you need equity. Equity is going to protect you from inflation.

It's going to grow. So equity is actually where I'm lacking right now, ironically.

Which is funny because real estate people, we tend to start really heavy on the equity and you're like, I can't spend any of this. It's cash flow. You have to fight for real estate, but it's what keeps you alive. Cash flow is the most important in my opinion, especially in the early phases.

So it's yin and yang, right? So like I started equity heavy. Yeah. Sold that equity, made it liquid. Yep. So now I'm very liquid and I'm very cash flow heavy, but now I'm not equity heavy. So therefore I have tax problems. So it's just like business. Um, I think people aren't really aware of how to build, like create massive, like jumps in wealth across like business and everything. Yeah. So it's like, first off you have like level one of the game, which is you save money. Cash, $100,000, $100,000. Second level of the game is invest cash in the stock market. So now you're making 7%, 8%, hopefully in an index fund, whatever you want to do. Yeah. So now that's something. Next step of the game is you buy single-family real estate that residentially appraises. So that goes off of comps. You know, if the house down the street increases $20,000 and then it's the same as yours, you'll probably increase $20,000. So that's how most people, most Americans, most millionaires have their wealth in like primary home or maybe a vacation home that has just appreciated over 20 years, right? Yeah. Buy $1 million real estate, have other people pay it off. So that's rental properties. Then you go into commercial real estate, which is off a cap rate. So now it's all—

which is the magic.

So that's where the magic begins to happen. Now you can— well, in single family, you can do the BRRRR process and you can look like to force appreciation. But now that you're doing NOI, that's where you can do $1 million plus of equity, forced equity appreciation, and you can control it and you can control it. You're not dependent on the, on the appraiser to come and tell you What the comps are, you're like, no, this is— these are the numbers. This is how I did it. I just fired this person, put $40,000 to my bottom line. We just did this. Like somebody was talking about a hotel that he bought, fired one of the, one of the staff, made it fully remote, $40,000 net to the bottom line, increased the valuation $1 million because of the cap rate. So it's just like small things like that with your bottom line. And then with business, it's off of net operating income and multiple. Yep. So it's like for me, like what we're trying to build right now with Action Academy is like, I can't show it on my balance sheet yet because I have what's called key man risk. If I leave the business, business doesn't operate, right? Yep. So I mean, it still operates, but it doesn't get new leads.

So yeah, it declines as soon as you leave.

So over the next few years, we're building it to where it can operate and get leads predictably without me. And at that point, once we're at $2 to $5 million of EBITDA, which is a fancy word for profit, then at like a 4 to 5x multiple, we're going to be looking at like a $15 to $20 million valuation on the company. Yeah. I can't show that today. Yeah. So I've got a bunch of cash flow and like, that's why people need to know what they're optimizing for. Yeah.

Have you got your business appraised yet, by the way? I know. Oh, I bought a partner out. So we had to get the appraisal for the SBA loan. I was like, even with key man risk, so your multiple goes way down.

Would you get like a 1x?

I got a 1.75x. That's actually pretty— it wasn't bad. I was like, oh wow, it was not as much as I was writing on my balance sheet. So I was like, oh, I guess I'm worth a little bit more than I thought.

I just write 1x of net revenue. Yeah.

Or next product. I would guess for your business, because you have key man risk, but you are, you have enough employees now and there's enough people on the team. I'm going to guess you probably get valued at a 2. I'm going to guess you're a solid 2. Yeah.

So, and plus we have a lot of recurring. So most, we got over a million dollars of recurring. Yeah.

For those who don't know, MRR is like monthly recurring revenue is, is powerful in your valuations and your ability to bring new capital in.

It is very powerful. Any business that you buy, if you can add, like even if you have a business that you buy that is a service business and you can just transition 20% of that revenue to recurring revenue, it will be worth like $1.60 as opposed to like a dollar for dollar for your one-off revenue. Yeah. Recurring revenue increases your valuation. Um, so for me, Yeah, I'd say we're probably at, yeah, so we're probably at a million dollar valuation. Like we're probably at like $700,000 some odd, like of actual like EBITDA. Yeah. So I mean, but yeah, the good news is people renew without me because once they actually join the business, it's not me at all. But like, I'm still like the face. I'm like, hey, join Action Academy YouTube.

And so here's the way I think about money. You need cash flow to run the business. You have to, in the beginning, you, everything you do has to optimize for cash flow. Otherwise you don't get to keep it. So the equity is not worth anything if you don't have that equity in 5 years, right? If you lose your real estate, if you lose your business, doesn't matter how much you're worth. You need liquidity to survive some things.

Like, I don't know.

Liquidity is defense. Yeah. So you play defense after you play offense, in my opinion. If you never score, you can't win. The best you can do is tie. So focus on optimizing for cash flow, which not enough people do. People focus on equity and they're like, I'm worth more. And I'm like, who cares?

I have a friend that is, high in the multifamily space. Yeah. Worth $5 million paper, does a bunch of syndications. He could probably point to 400 units or something that he owns. And he's been GP/LP split on all of them. He's co-GP on a lot of them. Yeah. $5 million net worth, still barely any cash flow.

And see, if you start with cash flow, what ends up happening is you hold a lot of real estate. You don't worry about losing it in commercial. The values do go up because you increase the cash flow over time. And also have a lot less than 400 rentals. Net worth is higher than that. Cash flow does not suck. I mean, I have great financial freedom in my cash flow because everything we bought was like, how does it cash flow? Correct.

Because that's what's tough. You were strategic about it. You optimized for it.

And what typically happens if you're doing the real estate thing is you pretty much go cash flow, equity, and then you fight for liquidity for a really long time. That's almost the flow for everyone is correct. It takes a while to get your big liquidity event, but when it comes in, it's, you know, multiple six figures. It's multiple seven figures. Like, it will come, but you, you're rich when you have all three in ample quantities at the same time. You could be wealthy. You can be high income. You can be all sorts of different things. Yeah. You really do have to come up with a game plan. Like Brian's talking about, you're doing a lot of investing now because you maximize cash flow.

You have some liquidity, but I'm, I'm— you build the equity, but I'm hyper-intentional about that. I want to actually add on that because it's super, super important. This is like, people are maybe listening to this and they're thinking about buying their first, like, pieces of real estate, right? But like, this is how they should be thinking long term. So for instance, like, every idea that I have, I only have it like as an idea until I stress test it with people that are way richer than me. Yeah. And then I, once I do that with enough people, I can bring that idea back and I say, no, okay, this is a solid idea. And so for me, there's two ways of building wealth. So there's called what's like called the profit first method, and then there's the delayed gratification method, which is what most real estate investors do. So most people do, and I do believe 1,000% in delayed gratification, but there's nuance here. Yeah. So what most people do is what you're saying, where they go build up all this equity over like 5 years. They scrimp and they save and they're like living on beans and rice. Yep.

And they build up this.

A lot of people do it. Yeah. And they build up this and then all of a sudden they're syndicating $1 billion of real estate and they're just living off acquisition fees. Oh God. Living off acquisition fees. Don't get me started on acquisition fees. They're living off acquisition fees. Yep. And then, but they can say I've got 1,000 doors, which is true. It's true. Yeah.

On paper, you own a fraction of 1,000. Yeah.

You own a bathroom in Boise. But anyways, so that's level 1 of the game. And then so I was interviewing this guy that was 34. He sold his company for $250 million at 29 years old. And for his 20s, from 20 to 29, he like paid himself like a $60,000 salary while living in San Francisco for 9 years. Which is not much.

I was going to say, so he lived under a bridge.

Yeah, basically for 9 years. And then finally, he had his liquidity event, right, where he was able to pocket $40 million at 29 years old into his bank account. And I'm asking him, I'm like, okay, cool, you got this $40 million. What are you doing? And he goes, oh, dude, well, I went and took a year and I traveled around the world and I did all this stuff and I, you know, flew like first class sometimes and I really enjoyed it. And now I'm taking that and I built a new business. Like, okay, well, so hold on a second. I'm like, so wouldn't it make more sense? I'm doing the same thing that you are today. Like, you know what I mean? And so I'm like, I like the profit-first approach where it's just like, you're intentional about taking some chips off the table. You're reinvesting the majority of them. But like, for me, I'm more so playing the game where I'm like, how can I increase my cash flow and increase my income so much? Whereby I can still invest and put 70% of my chips off the table back into reinvestments of my own business, into future businesses, into future real estate. That 30% that's right there, I'm like, I can live my freaking dream life and I could do it now. So my trips to Europe, like I'm spending probably $30,000 a month. Yeah, I'm probably spending $60,000 a year, maybe up to $100,000 a year in travel alone.

Which is wild.

But what you can point to that and say, well, Brian, you should invest that in, in real estate and scaling your business. And I would say, for what? Why?

Another thing you've done, and I think this is actually super smart, I think everyone should do this with most assets. The story is worth more than the real estate, the things that you learn along the way. Yeah, I think personal brand is not nothing. And you've done a really good job of like, I'm going to travel, but I get to travel because of my businesses and I can talk to other people and relate to other people who want to be doing the same. Like you're telling an authentic story of something you were actually doing. Correct. And the more you travel, the more people get to see that story, which does drive more people to Action Academy, to your podcast, to your network where they act. The difference between Brian and a guru, by the way, is you put the, you put the backbone into your actual program. So they go through your program, they actually get what they're trying to get, right? But you have a quality place to guide them, correct? And people can actually see that you got there, but you—

and they come travel with me. It's effectively— that's even cooler.

It's effectively marketing spend. Like, it's not really— you're not really spending $100,000 to travel. You're spending $100,000 to travel, do what you want to do. And it is vertically integrated with the business that you built, which is a passionate part of your profit model.

I agree with that, comma, but that came with intention later. If I made zero money from it, I would still spend the $100,000 to go travel. So there's a diminishing return on your enjoyment of travel. Yeah. So people don't take this into account. They're just like, okay, cool, I'm going to delay my— so I'm 29 right now, about to be 30. And I don't have any kids yet. So I am aware, like, you just had your first kid.

Dude, you have so much to look forward to. I'm 3 weeks in. It's awesome.

Best thing ever. Oh, it's amazing. Yeah, it's awesome. It's awesome. But still, people are like, okay, I'm going to delay my gratification. And then in my 30s, I'm going to go do what I want to do. In my 40s, I'm going to go do what I want to do. This is making the assumption that you're even able to and you don't get hit by a freaking bus. Yes. Okay. I have friends that have been hit by buses, unfortunately. And they literally passed away at like 31, 32. Oh, that's terrible. And I've got friends that died from cancer, you know, at 40, you know, so it's just like, you're not guaranteed anything. Yeah.

I have friends who passed away in high school. Yeah.

And at 30, like, so right now I'm at, I'm almost 30. So if I delay until 35, then maybe I have like a kid or two at that point. And then if I delay until 40, those kids are like 5 years old, 6 years old. If I delay to 45 and 55 and 60, so it's just like the more that you delay, the less that you're going to enjoy it and the more responsibilities that you have and the more difficult it comes to actually go do these trips and stuff. Yeah. So it's just like, for me, I'm like, I want to front load those and do them. So then what I did afterwards was I was just like, I want to live the life that I want to live and like fund my fun while I'm still young and being able to enjoy it. And I think that at 80 years old, I will come back and look back to this and say, fuck, I'm glad I did that, as opposed to reinvesting everything. Then what I did was I optimized and I was intentional over a year to build a business and build my systems to where I'm like, okay, I'm going to do this anyways. Why don't I just go ahead and build systems to where I can make money from this and tax deductions from this? So, I mean, like, to your point, it's completely true. But before, like, that was with intention and people can use that with anything, you know, like they can make themselves a personal brand about anything that they're interested in and build businesses around anything that they're interested in adjacent. That don't even need to make that much money in profit, but you can still show and be like, hey, like, this is what I'm doing for my business.

And what you said, I think is central to people being successful in business. And this is why I would say that the 9 to 5, the way it's currently structured, is just completely unpalatable for anyone who has any ambition. Ass backwards.

Yeah.

Especially for 401(k)s. If you— so in theory, if you lived forever, delayed gratification would be the perfect model. It's like, Let's just like bank all on the front end. You have to strike a balance there. And that's why like guys like Brian, guys like me, we're so intense about building our business as, as structurally sound so we don't build it twice, but also as fast as possible.

So I'm like, because time matters, I will not live forever.

So if I don't do the things that I want to do, what was it all for? This actually told a really good story. We started with Are you setting your goals? And is it crystal clear where you're going? If you don't have that, none of this stuff matters because you're going to wander around and you're, you're not going to get what you want because you don't know what you want. Once you know that, you chase after it as aggressively and securely as you possibly can in whatever matter. This is why I love paid mentorships, by the way. In whatever matter is the safest and most efficient way to get there. Learn from people who've done what you want to do. Do the thing, but then don't just never spend any money. Don't be— because then, then you, then you're cheap instead of frugal.

You're just cheap. I have a friend with almost $100 million of real estate, over $10 million net worth, and I can't convince him to come travel with me and spend money. So finally him and his wife are coming with me to go do stuff like Kentucky Derby and to like go travel and stuff. Like, what more do you need? And like, here's the thing. Here's another crazy thing. I know rich people that don't like where they live. My brother in Christ, move. Oh, it's too cold in the winters. Oh, I don't like the people that are in my neighborhood. Oh, I don't like the school that my kid's at. That's why you invested. Move your family to a place that's sunny and nice and people like you and you like them.

One of my earliest investors, the earliest mentor investors, well over $100 million net worth. Yeah, well over $100 million. He was so excited to tell me that he found a deal on this Mercedes for $7,000 where he's like, dude, I've wanted this car for a long time. I remember when I was younger, I saw one used. I've been fixing it up myself. I got it for 7 grand and I only had to fix something with the carburetor and it's working. I'm like, you make $100 million, dude, and then buy the car you want to buy. I only drive one car. I'm all about being free. My wife and I share cars, Tesla Model Y. I like it. I'm not a car guy, so I don't invest in cars. But I did buy the car that I wanted to buy. That's the— that fits my kid nicely. It gets us around. It's the car I wanted. I was able to be cost-effective, but I'm certainly not trying to buy a $7,000 car. I mean, that's ridiculous. Yeah. And I'm also not worth $100 million. If I was a $100 million guy, I'd probably buy a Lamborghini Urus because they're kind of cool, dude.

Money, money is energy. And you have to think about money like water. Like if money's not flowing and money's just sitting still and it's not doing anything, it becomes stagnant. And then that's where all the rot comes in. Like money needs to flow like energy. So I've been on both sides of the spectrum. I've been an aggressive spender. I've been an aggressive saver. Yeah. And then so what I came up with is what I call my 10-year rule. So what I do is I don't spend, like I said, with the money buckets thing, I don't spend money on everything. Like if you actually look, I probably spend less than most people, but I'm intentional about where I spend my big chunks. Yep. So I have this thing called 10-year rule, which is if it's an experience or it's something that I'm going to spend a large amount of money on. So over like $1,000, if I'm going to remember that for 10 years or more, or if I could be on my deathbed and I could be like, I remember doing that in 2024, if it's a year-defining thing, yeah, I'm going to do it and the money will come. And so that's my rule, even when it makes me uncomfortable, especially when it makes me uncomfortable. So the story that I like to tell is of Singapore. My friend's getting married in Singapore. Crazy Rich Asians is my airplane comfort movie. Yeah. So it's just like I watch it every single time I'm on the airplane. Yeah. And so they get this crazy rich Asian family that gets married in Singapore. Very, very— the title tells you what the movie is. And so they were doing their Crazy Rich Asian wedding in Singapore. I was like, that's my time. I was looking at the flights. I was like, that's going to be $5,000 and I'm going to stay at the Marina Bay. That's going to be another $2,000. And holy shit, this could be $8,000 before I touch foot. Like set foot in Singapore. Yeah. I was like, 10-year rule, 10-year rule, 10-year rule. And it was hard. I was like, I'm going to remember this for the rest of my life. And like, what other time am I going to go to Singapore? It's a 24-hour flight. And so I was like, I'm going to do it. And I went and lo and behold, Christian, the money came back to me. Like, it always comes back to me in ways that I did not predict. Like I had somebody that was like a coach, literally, that was like, Hey man, you had like, I like 3 people sign up over like the last like quarter like that you didn't even know about. Like, here's $4,000. What? I just covered half. And every single time I've done it, I've done this like 8 or 10 different times. Yeah. Even material things. Like now I like watches. It's like, this is a Cartier. This is like $7,000. And I got like a— I buy them for like different life events. Yeah. So I bought a Rolex finally for like $13,000, $14,000. Yeah. And then that was my million-dollar-in-my-business watch. So I was like, I hit my millionth dollar. I bought a Rolex because it was something that was out of my comfort zone, something I wouldn't normally spend money on. And I can see that and I can attach it to an emotion. I can attach it to a thing like an experience. Yeah. And so I just try to do things that are like year-defining. So Jesse Itzler calls it like your Masogi, which is a hard thing, but I say it's just something that's year-defining. But I want to like circle all of this back. Which is the most important thing that people need to optimize for. I'm all for people doing things for internal satisfaction and joy, not external. Yeah. However, if you want to be around interesting people and you want these $100 million mentors and you want interesting people to want to talk to you, you need to do interesting things. Yes. And if you're not doing interesting things, they're not going to want to talk to you. So if you're just like, oh yeah, I'm buying, you know, 30 units a year and I'm just like staying at home and like, that doesn't get them going. But you're like, dude, I quit my job and I travel full-time around the world. I got billionaires reaching out to me. I became friends with the billionaire founder of Priceline.com.

Oh dude, that's awesome.

Yeah, Jeff Hoffman. Yeah. And like, he was on my podcast and everything. And now like, we talk because he was like, that's such a cool story. I did that when I like, when I first like quit college, he's like, I went and traveled. So cool.

Choosing the adventure is something that more people need to do. People, I hear it all the time, you're like, oh, I don't know, it just feels too risky. I don't know that it's safe. I don't want to— I'm like, dude, if you don't do anything, what's the point?

There's no point. This is Styrofoam. Why?

I, again, I'm not— I'm not a big— I'm just not a big material guy. Like, this is a Hamilton watch. It retails for $1,000. I think I found it online for $600. And then I fixed the spring on it. Congratulations. That's about as far as I need to go on watches. For me. Yeah. The only thing I care about It's like I have never lived in a large house. I had a perfectly adequate house in the Seattle area. It was 1,300 square feet, 3 bedrooms.

Dangerous place to live is perfectly adequate. It was.

Yeah. And so many people are like, well, I don't want to risk that, dude. I put a first, second, and third on that house to build my businesses, buy out partners. Was that risky? Heck yeah. This house is like 4,000 square feet.

Yeah, it's a beautiful house.

It's a beautiful house. It's not super flashy. But I mean, this is like, this is twice the house I've ever lived in in my life. Yeah. I don't need this much house.

I mean, it's— how do you— how does it make you feel?

My son's this big.

How does it make you feel?

Dude, I feel amazing. I wake up, I have these huge glass doors outside. I make my little espresso thing on my espresso station. I go outside. I like thinking in the morning. I know you're a morning person. I'm a night person. I like— I do my best work at night. My most creative work is at night. Morning, I like to take my time to think about my business. And I take Slow. Yeah. These are things you— no meetings in the morning. Uh, everyone tries to call me. I'm just like, nope, nope, nope, nope.

I turn my phone off. Yeah. Yep.

That's basically what I do. Mm-hmm.

Get up.

Well, now, now I have to go, you know, like change my kid and stuff. But outside of that, it's like, that is my time to like sit, meditate, pray, get ready for the day. This is the last major thought I have on business because I think, I think this is the thing. If people did this, your life would be a million times different. For you, how much time do you spend thinking about your business? Not doing, not acting, not in a meeting, not spending money. How much time do you find regularly that you are thinking about your business? 50% of my week. And look how far you've come. That is— every mentor I've had has done that. Everyone ahead of me.

That is like the difference.

You need margin. Yeah, like, what do you do? I spend more— I've spent more time thinking about my business than you. I know where I'm going.

I walk and just think and I journal and I write things. I do. And then you also have to like identify like where your areas, like how can you optimize your environment for your best thoughts? And for me, it's driving. So stupid. I've been financially free for over almost 3 years now. And I used to drive in rush hour traffic every single day. I promise you, I'm quite possibly the only financially free person that does not have a job. That in the morning I will drive— I have a cafe right next to my apartment. Yeah, I will drive 20 minutes away to get my coffee that I want from Dunkin' Donuts because that's what I've been doing for years. And I will sit in rush hour traffic on the way back and I will drink my coffee and I will listen to podcasts because I realize that if I'm not in my car and I'm not driving with my coffee, I'm not listening to podcasts.

Do you know what I customized in this house more than anything else? It was my shower. I can—

you're bragging about your shower.

Yeah, I shower, drink in the shower.

I think in the shower, I'll take 30, 40 minutes shower.

Yeah. And there are times where I'm like, usually I shower at night, but like there are times where I'm like, I need to, I need to work through this.

That sounds like a good time that you're showering.

Hop in a giant shower. The water's going, you're warm, it's quiet, there's white noise going on. It's all the stuff. And you think about the business and it's amazing how many problems get solved. First thing in the morning, sitting on my couch, drinking my coffee. It's some of the most valuable work you do is think about the business and work through the problems. I have found— I want to say it's probably 99%. It might even be 100% of the time when someone comes to me with a business problem, it has come down to, I'm like, you have spent less than an hour thinking about this and you've been— and oftentimes it's something they've been stuck on for 6 years. And it's like, oh, I've been, you know, I have this family thing. We have $11,000 of credit card debt and I just, I've, we've been trying and trying and it always catches up to us.

I'm like, think about spending less.

Or I had someone, so I had someone who's like, I haven't bought a real estate deal because I want to try to pay off my credit card debt. And so I want to flip, I want to flip a property.

Oh, so let's get on that credit cards to flip it. Yeah.

And so they're like, so I'm like, so your solution is you want to take on more debt to pay off your other debt. Which, which isn't inherently a wrong idea, but I'm like, that's— you're not thinking along the right lines. I'm like, if you were quiet and thought about this, you'd go, okay, what do I have? I have a minor liquidity problem. Is there— my goal is to own real estate. Is there a way to own real estate and also get liquid at close so that I can solve problem A and problem B at the same time? Like, that would be my first question. Can I do both? So when I needed a little liquidity on like my fourth deal, I'm like, ooh, I need a little extra renovation costs for another deal. It turns out when you're new to real estate, you don't always do all of your math correctly. I was like, I need a little bit more cash. I don't like acquisition fees, but I did a deal that was super, super heavy lift. I wholesaled the deal to myself. I went, it's in my name. I'm bringing on 3 investors. I've worked my butt off for this. My work is worth $20,000. They're going to get their return. Everything works on the deal. When I assign this contract, to my LLC, I'm letting everyone know I'm getting paid $20,000 for lining up the debt, the deal, doing the relationship knowledge, the 2 years of work it took to build the relationship. Yeah, it's worth $20,000. It solved my problem. But like, that took one shower to figure out how would I get liquid and also buy this deal. Hmm, maybe I should just get liquid and buy the deal. You can solve these problems in 20 seconds, and most people don't spend time daily doing the 20-second things that make you millions of dollars.

And the other thing is, and this is me yelling at myself too, it's just like, there's nothing that we're trying to do that hasn't been done before. Yes. So we're getting so caught up. Like, it's really, if you've been working on a problem for over a year, like, it's really foolish. So for instance, here's a prime example. You know how to do Meta ads and webinars. I do. I don't know how to do meta ads and webinars. You know what I've been bitching about for the last year? Meta ads and webinars.

I own a company that runs meta ads and webinars.

I'm yelling at myself.

For other people.

I'm yelling at myself and I'm yelling at people that are even richer than me over and over again. Business is not hard. Like, it's only hard because you're not good enough yet. Like, that's it. Like, I just— there's somebody that's done— like, it's sticks and bricks in this business. These have been done for thousands of years by millions of people. And unless you're fucking Elon Musk sending a rocket to Mars, yeah, people have done what you're trying to do. Yeah. You just need to go find your who's. That's it. Drive to Dallas.

And what we do is we go, hey, we need to go to college. I need to get 6 jobs. I need to build the experience. When I'm like, dude, someone's already done it. We talked about the value of time. The first person I saw, actually, the first person I learned from was freaking moron. I learned so much about how not to do business. It's probably the most valuable mentor I had. Good.

Yeah, that's awesome.

I often ask myself, would this guy do this? It is definitely unethical. Then we won't do that. Like, worst possible mentor in the best possible way. I learned so much. The first actual good mentor I had had been doing real estate for 50 years. I built a larger portfolio than him in 2.5 years, and it's not because I'm awesome at all. There's nothing special about how his experience— he let me— I took 50 years of his life and did it in 2 years because he told me how to do it. Correct. That was one guy. I built my entire business. We renamed the podcast The Owner Meeting. You're the first— you're the first ever podcast on multifamily strategy when we actually start pushing out the podcast. You know, the first podcast for the rebrand of The Owner Meeting or second, one of the first— first few.

Oh damn.

The whole business was built on The Owner Meeting. Find the people who've done the thing that you want to do in the area you want to do it. And then meet those people. Yeah. And then that's it. I'm trying to learn how to build a podcast. For you guys who have watched the YouTube channel, we have a following. For those who've seen me on Spotify, thanks for being the 100 people who watch me on Spotify. Like, Brian's gonna show me today on like how he built his podcast, which— how many downloads do you have on that thing?

I mean, we got over like 1.5, uh, so we're doing 100,000 plus a month. Crazy.

Yeah, crazy successful podcast.

Yeah, we're up in the top 100 entrepreneurship in the world.

And you should see some of the guests he has on this. I mean, you have— you do a daily podcast. Yeah. And you have fantastic guests all the time. I mean, it's— it is actually— it's just an amazing podcast. It's a really good business podcast. Yeah.

We just had like the— like Leila Hormozi on, Dan Martell is now a friend, like people like that. Yeah. It's crazy. And the more guests you get on, like the better it gets. I want to talk about something that you just said that I think was like really, really powerful that you kind of glossed over there. Yeah. Which is, um, let me think about how I want to phrase this. When we're all searching for mentors, but when we're looking for mentors, the, the good people aren't always the best mentors. Sometimes we can find the best mentors in people that were a bad experience of what not to do. Yeah. So for instance, like I had a really negative relationship with my father and he wasn't around, but what a wonderful mentor for me and what not to be. Mm. Right. So I'm like, I have context. Like, some people have all the best context. Yeah. But if you can appreciate your bad situations and you can learn from them, that's how you can more easily forgive the people that hurt you. Because I could take that. I'm like, okay, you did this, this, and this. You were never home. You never paid attention to me. Like constantly gone and I was like desperate for your approval. I'm like, so I now know that I can do the inverse of that and be a good father. Which— so the same thing with your business partner. Yeah.

When I talk about it, because it's easy to hear, I'm like, okay, so my first ever mentor was amazing at raising capital. He had no ethics, so he stole a bunch of money from people. It's easy for people to hear that and be like, oh, so you're a scammer.

It's like, yeah, terrible. Yeah.

I learned like I learned what not to do. Bad guy. But what I learned in creative finance and how to actually raise money for a great opportunity— I'm like, he could raise basically unlimited money for opportunities that never made any sense to anyone. Yeah. And I'm like, okay, well, the skill is cool. The use is absolutely abusive. What if you could buy all this real estate and not lose it? And what, what does it actually look like to do what he says he's trying to do? It's a good idea.

The execution's wrong. Yeah.

I, the business that I built, a lot of it, like I look back on it, I'm like, it wasn't intentional. I wasn't trying to like take an idea, but a lot of the success we have, my company has ended up looking very similarly to the vision that he communicated to me of both company. He had a great idea, great visionary. His ethics literally killed him. Yeah. And his inability to underwrite.

But, well, failure's only failure if you don't learn from it. And if you do learn from it, it's just a lesson. Mm. So it's just like failure is the only guarantee.

We're talking about tasty stuff from Brian Lubin. Yeah.

So we talked about this before. So you were like, you were angry because somebody on your team guaranteed somebody something in your program that you can't guarantee.

You can't guarantee. Literally could not enforce it if we want.

There is only one guarantee that anybody can make to anybody. And this is what I tell people joining Action Academy is you will fail. Like, that is my guarantee to you is you will fail not once, not twice, but so many times.

There we go, guys. Action Academy. Action Academy.

That's the ad. Action Academy. So that's a short. Come fail with us. Fail fast, fail forward, baby. Here's the thing. That's what's required. Yeah. Like failure is the price of the ticket. Like failure is the price of the ticket that you pay for success. Like it is the admission ticket that you pay for all the wins that you want, all the success, all the millions, all that stuff. There is no entrepreneur ever that's made millions of dollars that hasn't failed. The only difference between them and you is they failed 99 times, but then the 100th time they, they won.

My favorite lesson that any entrepreneur can give. Yeah. Like learning how to do things is really cool. Mm-hmm. Learning what not to do I think is so much more valuable. Like the mistakes I made that cost me a quarter million dollars or a million dollars.

That's where mentors come in. That's the nuance. Yeah.

It is so much more valuable in my mind. You could replicate everything I did in Creative Finance. You could almost replicate it just by watching my YouTube channel. Like, I don't think you can— you probably need to join Multifamily Strategy if you want to like beat what we did, which I've had mentees do more than I have. Guarantee of failure. Yeah, guarantee of failure. But, but the lessons that we learned on how not to lose money or not make those mistakes is so much more. My question for you, what has been your most personally expensive mistake? Like it could be like you lost a friend, you burned a relationship. It could be, hey, I just straight up lost a million dollars. Where did you have a lesson where you're like, boy, if people could avoid this thing that happened to me, they're gonna move farther, faster. They— I, I can fail for them on this one thing. And now I'm rambling to buy you time to think.

No, that's okay. We can just sit in silence for a second. Mm. Yeah, I would say that when you become the type of person that sets really big, exciting visions for life, you can't force your vision on other people.

What did that look like for you?

So it's like, for me, I was in a relationship for 3 years and I had this giant vision of quitting our jobs, hitting financial freedom. Traveling full-time around the world, getting married, having kids, all this stuff. Like I had it written out. Like, that's what you're supposed to do. And she was like, I don't want that. And I was like, what do you mean you don't want that? It's like, I wrote it down. This is how it works. Have you not read the fucking book? Like, I wrote it down.

I think especially as men, this is, this is particularly hard.

And this is with friends. This is with your family. This is with possibly your significant other. Yeah. And I dragged her along, and it was as my fault— it was— it wasn't her fault for not wanting to do that vision. Her vision was different, and I never took into account what she wanted. I was like, of course, why would you not want this? To go live in Greece and go around the islands and do all this stuff, and we're gonna have babies and all this stuff. She's like, I don't want that. And I was like— and I just fought it and dragged her along. And, you know, then we ended the relationship and that's what did it. And I think a lot of people are in the position where they're dragging along like the corpse of an idea, not to call her that, but like friends that are like, you're trying to drag along. You're like, financial freedom, we're going to buy multifamily through Christian and we're going to be financially free. And they're like, dude, do you know how many people are actually excited about real estate? They're like, bro, this many people. I just want to like, you're talking crazy to me right now. And so you're going to lose friends, you're going to lose relationships. Sometimes you're going to lose family. Like me and my family aren't that close ever since I started this because they just cannot understand that. I was like, hey, when we speak, I'm no longer accepting you telling me every way that I'm going to fail. I have no space for that in my life. That is my hard and fast boundary. Like, I don't want to be around remember when people. I want to be around imagine if people. So it's like all we talk about is our past. When I'm with my family, like all we talk about is, oh, remember this, remember that, remember this. And I have friends that were like that. I wanna be around people that are imagine if, like imagine if we did this or imagine this or imagine this in the future. Like that's who you need to be around. And I told my family a hard and fast boundary. I'm like, stop being the people that are telling me all the reasons I'm gonna fail. That's my family. Yeah. Can't get rid of them. But you can set guidelines and expectations and boundaries. And I was like, if you want to call me and we could talk about things that are going well or areas of your life that are great, it's like, stop telling me, stop calling me to complain. Yeah. I have no space for that.

Dude, I, that resonates. And I think this is pretty much all entrepreneurs. I mean, that is, that is basically what it is to be an entrepreneur.

And a lot of their spouses too, because they never took time to actually do a group, a family vision. So what you're supposed to do, you create a vision, they create a vision separate. Then you come together and you create a family vision and you see like what values, what ideas are intertwining, and then you mutually agree on it. And now that's how you get buy-in.

Well, a huge blessing in my life has been a lot of people give me the feedback like, hey, I love your and Danny's relationship. Like, my wife and I are super tight. We've always been lockstep on everything in the business, right? And she started as a schoolteacher and I was a salesperson. Like, there's no logical reason for where we got married where you would look at that and say like, Boy, of course they did well as entrepreneurs together. We had no common skills. Yeah, yeah, yeah. We've always communicated well. We valued that in the beginning of the relationship. We had like two things. Both of us are like, okay, well, neither of us want to get divorced at any point. So that's just off the table from the beginning. So we don't, we don't talk about divorce. We don't. It does not enter the— I have never thought about that. And we made the decision. That's not something that we do think about. We don't believe in it. We're not going to do it. I'm like, okay, well, good. I don't stress about that. That's nice. The number 2 is like, we talk all day. I talk to her in the morning, I talk to her in the night, we do business together, I talk to her through the day. There's nothing that's going on in the universe that we're not doing together, and that is a freaking awesome marriage plan. Correct.

Your best friend, you're— yeah, your partner. I made the comment where I was just like, I have friends that are like, I've got nothing in common with my wife, and that's how it's supposed to be. I'm like, dude, like, you should have everything in common with you. You should have so much in common with your wife.

Like, you guys should feel like one unit. Like, they're—

if the rest of the world disappears and you guys are in a nuclear blast bunker together with you and your newborn child, you should be like, thank God I lucked out.

And that, in my opinion, is what great businesses should look like. You should have people who are in for the vision, who are sold out, who are in for each other. I run all my companies as an idea meritocracy. Every— from janitorial staff to— not that I have a lot of that. I have like 2 businesses, but from janitorial staff for my skyscrapers up to the C-suite. Uh, well, yeah, the resort has, has a lot of cleaners, but from, from janitorial staff to the C-suite of any of my companies, every single idea is heard. We value it based on people's experience. I actually have people in my business, even when I'm in the CEO role, I have people in the business where I'm like, yeah, you just have more experience than me here. Like if we have two competing ideas, we're going to ultimately go with yours. If I can't, if I can't sell you on my idea, we're going to go with yours. And sometimes they're right. Sometimes they're wrong. It doesn't matter. I've run all my businesses that way. But when you have everyone feels like they have input, everyone is heard and everyone is sold in for the vision, do it. And in your company, if someone's just not in for the vision, you're not the right fit for them as much as they're not the right fit.

And you're dragging them along for no reason.

Getting rid of them is not mean. Like, that is the kindest thing you can do of like, hey, you are not going to succeed here any more than I'm going to succeed because you're here.

And they're going to thrive somewhere else.

And they will. And they almost always do.

The biggest mistake I made in business as a CEO was, which a lot of people are doing, most people are doing, is I would like, if you bring me good news, you're the, you're the king and queen of the world. I'm like going to shower you with praise. I'm so happy to hear from you. But if you bring me bad news, I'm going to rip your fucking head off. So like, that was something I struggled with in the first year of the business. I didn't realize I was doing it because we don't like hearing bad news. Oh, you're going to come tell me all the problems around the business. I'm about to do a podcast episode. What do you mean?

I'm the fixer. So I've always thought it gets better.

So what happens is then they stop bringing you bad news. They start hiding the bodies because they don't want to tell you because they want to be in your good graces.

And then your problems become—

Then your problems compound and they become big problems. Exactly. So pivot to, okay, let's talk about both stuff. Like let's have an open dialogue across everything. Now we do have parameters that we talk about where we, if I have bad news and it's both way, two-way street, my team talks candidly with everyone and like we're a little crude, rude and crude sometimes, but they can say the same thing to me that they can say to each other that I could say to them. And I can say, hey, this is the shittiest thing I've ever seen. They can say the same thing to me. All right. And they do, trust me. Um, but like it got to a point where like in the very beginning, yeah, I was just like, tell me nothing. But now it's like, if we do have bad news to tell each other, we'll give it— we'll give each other a heads up. Yeah. Because 9 times out of 10, it's not something that's urgent, but it is something that is critically important, but doesn't need to be right now. So for instance, if it's like a DEF CON 5, like I will get a text and that text will read something like, hey, huge issue. Like, are you in the space right now to receive this? Because I may be deep in thought about a really important business issue and I may be about to break through. I may be about to go on Hormozy's podcast. I may be about to go on Dan Martell's podcast.

And I don't want to be thinking about whatever that thing is, right?

Which they were dropping bombs on me all the time. Like, so now, and I do the same thing to them. I'm like, hey, I've got a piece of feedback. You're not going to like it. Are you good to receive this right now? Another rule we have, fucking call them. Call them. Don't text me the problem.

Oh my God. Call me.

Do you know? Because everything gets lost in context. Nothing.

There is no tone to a text message. No tone.

I would say an argument. Yeah. When I text my team and when I send WhatsApp messages and when I send an email to my team, it always comes off as 60% ruder than I intended because I'm very blatant and very blunt with my communication because I don't spice it up. I'm just like, hey, this is the worst thing I've ever seen. Like, or it's the best thing I've ever seen. Like, I just tell them how it is. Another thing that we do is we lead with data. So there is no right or wrong. It's what does the data say? So if you come to me and you're going to oppose me, you're welcome to oppose me on my team, but come with relevant data. If you come at me with relevant data, if you come at me with how you feel, I'm going to rip your head off. I'm going to rip you apart with my data, not with my emotions. Yeah. So they have to come to me with data. And there's been multiple times where my team has came to me with data. And I was just like, I hate everything that you just said, but I'm going to go digest this. Like, and like in the beginning, I'll be like, this is the stupidest thing. I'm trying to think of a perfect example so I can lay out the plan for people so that they can actually use this in their businesses. So we were in Tulum. Caitlin comes to me and I did a present— I did a Google form. Yeah. To ask people, it's like an NPS score. So net promoter score. Yeah. And so we were asking the people to rate and review the event and the company. So it's just like, what did we do right? What did we do wrong? Like, you know, how likely are you to recommend Action Academy to a friend, blah, blah, blah. And I spent 2 hours on this thing and I made this questionnaire and she goes, oh, it's too long. I didn't even read the last part of it. I was like, what the fuck? It's like, what do you mean it's too long? And like, so she like, like, I'm not going to not get upset. Like, I'm still allowed to feel my feelings. Yeah. Not be rude. I'm like, I just spent 2 fucking hours on this. What the fuck do you mean? And she's like, it's the data. And I was just like, fine. And I just like walked away. She was super upset by it. Yeah. Yeah. But I told her and then I came back. I went and stewed on it for like 5 minutes, 10 minutes, came back and I was just like, You're right. Thought about it. Data supports it. You're correct. Changed my mind. I'm gonna go with your plan. And so it's just like, and same thing to them. They're allowed to be upset at me. Yeah. But if their data is, if my data is correct, if their data is correct, like be human, but like, hey, like the data is what drives the decisions. And we got that from Amazon.

I, I love, I'm, I'm only gonna add one, one contrary thought to that, that you do. I think there's a point where you do need to have a forum for people to be human. There, there's been a few times I hate it when someone comes and blindsides me with emotional stuff that doesn't have data. I'm like, well, I'm feeling this. And I'm like, okay, well, that is not a right now thing. I also recognize that you need to be there. I tend to be fairly robotic about business. Yeah. This is what we're doing. This is how we're doing it. If you guys have a competing, kind of like you, it's like, let's go through the data. Let's go through the motions. You can burn out great people that way. I do make sure that there is time to actually specifically call people. It's usually after the workday. Emotional support. Yeah. And it, it's like, and I've had times with a partner where I'm like, I'm pissed and I can be pissed at you all the time and then we're at war with each other. Or I can call you and say, hey, I'm feeling shitty about this and I've been feeling shitty about this to the point where we need to bring it up. And so, mm-hmm.

But you not a text, a phone call.

Always a phone call and always preface that. That is a, that is a meeting that you have a verbal agenda for. Here is exactly what I'm feeling. This is why this thing is a problem and we're going to get through this thing or we're not. And here's what it's gonna look like. Like those are important.

You need to have those. But you also have to say, it's important to say, I don't have a problem with you. I have a problem with the problem. Yep. You have to separate the problem from the person. Yes. So it's just like what we do whenever we're having a problem is we have this phrase that we say where I'm like, Same side, same team. Yeah, same side, same team. Like, so if somebody's doing something, I'm like, I don't got a problem with you. I got a problem with like this piece of communication or this way that you did something or this way. It's like, yeah, love you. That's why you're on the team. Like, but how you handled this, completely unacceptable. Like, let's talk about that. Same side, same team. Like, yep. And they'll do the same thing for me. Like, they'll come to me and they'll be like, hey, like, you were super rude here, like, in this email, like, That's your pro— it's not you. That's like, this is the problem. Can you not do this? Now, something I learned from Layla Hormozy is you have to give somebody a specific— if you're going to give somebody feedback, you have to give them a specific one thing, one thing to change, not three things. Oh my goodness. One thing.

I hate them because then they dump all of their stuff. You do this and you do this and you do this. Yeah. Like now, now nothing's going to get done.

So for instance, like Caitlin and Stephanie and my team would say, You stop being an asshole. What does that look like? Like, what actions am I doing that are yielding the feeling of me being an asshole? And it got to the point where it's like, when you text or when you send emails when you're angry, it could be very condescending. Like, you get really blunt and very condescending. And so I was just like, okay, well then instead of that, let's make it a policy to where if any of us have a problem with each other, like, we can text to identify it and say, hey, have an issue. Like, are you in a space right now where we can talk about this? Phone call. Immediate phone call. Yeah. And then when we're on a phone call, that all got mitigated. And then everyone's like, oh, okay, now I feel much better. But anyways, that's all business ownership. Um, and kind of like anything that you want to do to close this bad boy out, because now we're, now we're like an hour in.

No, not, not, not really rolling in. This is, uh, it's always fun to have you here. I know you, you, you can just drop bombs all day long. I mean, this guy is, this guy is a mastermind. Podcaster. So it's fun having you in here. I appreciate all that you shared here. If— I mean, we have a lot of takeaways, so I'm not gonna try to summarize everything that we did here. I will, I will end on this. This is a business owner who's owned, owned real estate. Yeah. Sold it, did other things that you're more passionate about.

And I'm gonna own one of the top 50 hotels in the world. And he's gonna own real estate again.

I'm gonna come back. He's gonna own real estate again. The, the goal is never the, the business. The goal is the goal. You know what it is you want to do and you're constantly building and adjusting and doing this. What you have put together is a sensible model. It looks incredibly like my model of you put together a clear goal, you build the best business you can. You're constantly putting yourself around people, paid and unpaid, that are better, that are better than you at what you do. I think your business— and this is, this is the takeaway I always have from Brian— he built his business in a way where he is not— I mean, you're still working through being the key man, but like the business is not relying on— it is not about Brian Lubin. There's nothing in your business that says Brian Lubin is the guy and I need to learn from Brian because Brian has something that I don't have. Yeah, it's— you built an actual community that is authentic, and I think it's a genius business model.

They're smarter than me.

You're not required to be anything.

Yeah, I just have to be myself. It's really easy to be you. Yeah, it's hard to bullshit over like 700 hours of podcast. So I was just like, from the very beginning, I was, I'm just going to talk about what I know and what I'm doing.

And you've built a community that is really successful there. So for those who, those who want to check that out, it's called Action Academy. You're so— and I think this is also beautiful. You're very selective about who you let in. You make sure that it's people who are going to succeed. Or let me try that again. It's people who are going to continue to fail.

Effectively forward together. Correct. Yeah. So we view our thing like kind of like the Harvard model where it's just like, is Harvard necessarily the best? Like, do they have way better education than your local school? Maybe in some categories to a degree. Yeah. But really what you're doing to go to Harvard is their selection process. You're like, I'm going to go there to network and be with the smartest and best people. Same with Silicon Valley. Like, you want to be in the hubs of all the best people. And so that's what we wanted to build. So there's sometimes people that come in that have like a bunch of real estate that want to join, don't pass the vibe check. So I mean, like we could turn people, we have turned people down for their vibes. We're like, oh, you're going to give more than you take. You're going to take more than you give. Like, you know, I give more than you take. Got to be all about accountability, growth-minded. Like if I flew into your city, would I get a beer with you? Like, so we take applications very seriously and we say no to about 40%. So I mean, like, it's kind of difficult to— we have like a close rate, but we have an actual close rate where it's like, who do we actually offer to? We offer to about 30, 40% of calls.

I know we're wrapping, but I'm actually super curious about— I love compensation plans where the incentives align with the objectives. Yeah. Do you actually literally come in and track like of the people that we want to close, what is the close rate?

Like, we have a metric, we have a gross close rate and we have a qualified close rate.

Dude, that is the way to do it.

So the gross close rate that we have is like 26%, and then the qualified close rate is like 52%.

Does the gross number even matter? Like, does that apply to anything?

Yes, because it is our marketing function. Because like I can say per 100 calls, we can reasonably warrant this much revenue or this many new members. There we go. From the 100 calls.

So that's telling you how the top line of the funnel is working. Working.

Bingo.

So yeah, but your, your team is going to be compensated off of getting the right people into the group.

That's why for that position we have somebody that the salary and her other incentives are so high outside of close. But yeah, at the end of the day, you know, if somebody is coming in, they're growth-minded, they don't need to have a big old real estate portfolio. But if they're just somebody that's just ready, willing, and able to learn, and like they thrive in accountability, like we don't take somebody if they can't feedback and actually implement it. Uh, like analysis paralysis does not exist in our communities. Action Academy. So you can check us out at actionacademy.com or listen to the Action Academy podcast, 5 episodes a week. Perfect.

All right. Get connected with the team. If you guys want to learn business, you want to learn mindset, you want to get around people who are actually doing the thing, hot damn. You want to learn multifamily specifically, check out Multifamily Strategy. We have the best community. $0 doesn't matter. I bought 100 units starting with no rentals myself. No experience, no money. Anyone can do this. There's nothing special about me or Brian. We're just two guys out there doing the thing. We'd love to work with you guys. If you haven't yet, subscribe to the podcast. This is the Owner Meeting Podcast, meeting owners like this guy. Yes, sir.

Every single week. See you guys on the next episode. Thanks, guys.