Final Session Panel Q & A: Episode 11 of the Live Sessions

Home stretch. Okay, I'm gonna make a quick announcement and then we're going to get to the, uh, the final Q&A where I'll bring the speakers from today up. That's Cody, that's Phil, that's Dylan. Uh, we'll snag all of them again. Uh, first of all, uh, I'll need one of the speakers to take a picture of everyone from the stage because that would be super fun for me to have and my phone is powering the computer. Um, all right. Uh, quick show of hands as everyone filters back in. Actually, it's a vast majority of you guys. How many of you guys are here are already at some point part of the mentorship? You guys are, you're— Vast majority of you, which has been super, super fun. I want everyone to notice something who's on the mentorship calls. Did you notice that it's everyone here are the people who, for the most part, turn their cameras on At the mentorship. It's all the faces that we recognize are the people who are here for the most part. There's one or two people whose cameras are sometimes off. She's wearing a mask. The people who show up and ask questions are the people who typically will buy deals. That is the most typical outcome. This is just something that we've seen very consistently. So I just wanted to thank all you guys for showing up. This has been so fun for me to see all of the— I care about everyone in the mentorship, but when I see your face, You're just, it feels like more of the main characters of our group are all here. And it really is super fun to see all of you guys here and to interact with all of you guys. So I just want to say thank you so much for making it out here. It means the world to me. So we are going to close here on a final Q&A. Before we do this, I just wanted to mention, if you are not part of the mentorship, you've probably noticed that there are a lot of people here who are. If you would like to talk to me about it, I do have a special offer for you. Flag me down right after this. I will talk to you one-on-one. I do not want any event to be a sales pitch. Notice we have no sponsors. I have not asked anything for anything, and I'm not selling anything. This is just here to teach, which I'm super proud of. If you specifically would like to learn more about the mentorship and want to join this community, I am also happy to sell you things if you would like to. So I know I am really happy to work with you, and I, Really love this mentorship. The one thing that I hope anyone who is new to the group would see looking in is that we've actually done a good job of coaching and building a community that is doing the thing that we are supposed to do. It means the world to me to get to see this in person with you guys here. So again, thank you again. Anyone who has questions, flag me down immediately after this event. I do have a special offer for you. For the Q&A section, I have 25 books. There are more than 25 of you here. However, if you ask a question for Q&A, You may also take a free book there in that box. So that is my incentive to get some great questions and hopefully some fantastic answers. So if all of the speakers can come up here, I have 3 chairs. I'll just kind of emcee this, so I'll stand, you guys can sit. My back's not gonna let me sit anyway. I'm old. All right. We are here. We are final Q&A. We are end of the event. We've talked about capital, we've talked about deal structure, we've talked about creative finance today. We talked about Capital structures, creative equity. We talked about sales, marketing. We got a bonus property management structures. What questions do you guys have to close out the event? If you have a specific speaker, let us know. Otherwise, I will just assign who I think should answer the question.

And if you ask Dylan a question, because Dylan's not going to get any questions, Dylan's going to give you an extra book.

Let's go. Come up to the mic. Ask a question, Ashley.

Hello.

Hello.

My question's for Dylan.

Double book.

Well, one of these people you can ask questions every day.

So yeah, this is it's a marketing question.

Yeah.

So obviously you've excelled in in what you do.

Yeah. Marketing, marketing and sales.

Do you do competitive intelligence against like your competition? How does that analysis look like?

If, and you don't have to share all your secrets, but I'm just wondering what kind of strategies you use from a marketing perspective.

Cool.

Thank you.

So first thing, I share all the sauce and I don't hold anything with anything I do because the hard thing isn't the secret. The hard thing is the application. Most people are not unwilling. I could tell people, I could tell everyone everything and most people will never apply it. Same thing as real estate, Christian, you guys have access to everything. So I just wanted to preface with that. Yes, we do. I have like an AI tool we use where it'll go through everything. But most importantly, I would just say this that relates to everyone here. There's a reason that Phil is in one market and doing very well. He was analyzing deals for 9 months or 7 months in his buy box. He knows exactly what his buy box is. He has eyes on it. He knows exactly everything in it. For me, we work mainly with coaches, consultants, course creators. I know everyone in the space because that's my niche. And I can tell you roughly, I could look at someone and roughly analyze how much money they're making a month just by looking at their stuff. Um, so I would say whatever it is like for you guys, that's the idea with niching down, picking a market or a specific buy box is you start to learn that and like the back of your hand, you'll be able to analyze it. So yes, I do. Um, I would use Claude. Anyone use Claude? Yeah, I would recommend using Claude for anything. That's what we do. So yeah, I don't know if that answers your question, but yes, we do a lot of competitor analysis.

Awesome.

Yeah, thank you.

So I have 2 questions, but I'll be respectful and answer them individually. First question is, as far as expenses and income, Can you use credit card statements, bank receipts, that stuff to verify their information?

Are we—

so this is for due diligence specifically, or what, what stage are you looking for what documents?

Um, like, I'll kind of narrow it down. So I'm looking at RV park, and the guy gave me some form of a rent roll, but it was like income per month.

Yeah.

So he's got so many sites, but it doesn't say this site earned this amount, this site earned this amount. And so I was thinking, and his expenses seem a little bit high to me, so am I able to ask him for, you know, proof of Income, proof of expenses by using credit card statements, bank statements?

Yes, that would be typically, I would do that after we're under contract though. If we had it, I would try to get enough information to make an educated decision, or at least under a letter of intent so that you're, you're investing. What I don't want to do is ask everyone for a bunch of financials and have them inconvenience themselves. Then we end up just not doing anything.

Right.

I want to be an active participant. In the deal. So as long as we've hammered out everything else and we're working off the assumption of if everything that you told me is true, then I would like to be a buyer of this deal. That's usually when you would request the personal financials, like a bank statement, credit card statements. But absolutely. And you should check every single one of those. Okay.

Thank you.

Absolutely.

Thank you, gentlemen. Um, all 4 of you have been incredible. I've learned so much. I'm very grateful for this knowledge. I'm— so I guess it's kind of 2 parts. Part of it is for you, Dylan. I'm starting with not having anything yet. How do you even begin marketing that? And then I know there's— it's like you have knowledge and a little bit of knowledge, but there's all these rules. Like you have to be careful of— is it SSC? Like you can't say certain things or— Certain syndications, like so there's these rules, but it's like you don't really know the rules, so you don't want to make those mistakes either.

Dylan, then Cody.

Yeah, I live in a world where there's no rules, and then they correct me. So, so two parts on this. I was trying to explain earlier here. What was your name again?

Stefan.

Stefan. He'd ask me, he's like, dude, like, what do you like? You cool? Like, you, there's this funnel thing, but how do I get people to it? I was like, well, I have a skill set that unfortunately costs a lot of money for people to pay for. Christian pays a lot of money annually, you know, month by month basis to work with me and my team. So I don't, if it was me, I would launch ads, right? Because that's my skill set, but I can't just ask someone to do it. But through conversation, I was like, but if I If I had to rule out ads, I was not allowed to run it, I would launch a podcast. Um, I think a podcast is the biggest hack to get anything you want for free. Uh, here's why. You have the ability to ask, uh, okay, if there's a, in Hemet, uh, you're, you're where you live. Um, there's probably some successful business owners. Would you agree?

Yeah.

Some, there's probably some millionaires, multimillionaires.

Absolutely.

Um, if you ask them to go grab coffee or lunch, they'll most likely say no. If you had a way to platform them and say, hey, you can come on my podcast, they'd most likely say yes. So podcasting is the best way to build relationships. And you could call it, you know, the Hemant Investor Club. And it's, you know, an everyday single mom that asks questions to successful investors and people in the area to learn how I can build my wealth. That's the purpose of it.

Okay. That's wonderful. So how would I get people to watch it?

Well, the purpose of the podcast actually isn't to yeah ads yeah ads um the the purpose of the podcast isn't to have people watch it; it's to connect with the people that are important that you could otherwise not. Christian and I wouldn't even know each other; we haven't even done the podcast.

Okay.

It was but you know two years later we're friends right? So it's not not about the watching; it's about the person you're sitting across the table from or across the Zoom call.

That is awesome. Thank you.

Cody, on marketing and what you can't do specifically.

Oh, well, I was just gonna share what I've done to market and, um, I guess you have some stuff you want me to share that I wouldn't do. But what I really focused on in the beginning for going viral online on a few things is I, I got really crystal clear on that circle drill we've talked about so many times. You talk about relatability, goals, and significance, the 3 sectors. And so again, whenever I'm having a conversation with somebody or I'm doing a podcast— podcasts are really good for building an online space and getting people to want to work with you and trust you— but I always go through that drill with people I'm working with. So again, it's— you mentioned you don't have anything going on right now, but at the same time, There's gonna be some parts of your story that people can relate to. And so when it comes down to marketing online or trying to go like door-to-door or direct phone calls, which is a great way to start a relationship, that again, that relatability sector connecting. So there's some point that I can relate to with you. Great. Now we meet up, you share goals that, you know, where you're going. That gets people to wanna work with you. They have goals that resonate. And so if they just liked each other and they related, they probably wouldn't do a whole bunch of business. But because they have goals that are going the same direction, they wanna work together. And then what changes when you get there? That significance piece.

Yeah.

In that drill.

Okay.

And that creates buy-in. And so that's where people will actually wanna invest money into your opportunities, even if you don't have like this crazy big track record in real estate, if you've shared that direction and what changes when you get there, that's where people take the chance. They give you the loan, give you the opportunity, and that's how I built my career.

Okay, thank you.

Appreciate it.

Uh, this is for Christian and Cody and maybe Phil. Um, I haven't heard you mention wraps. Have either of you, um, structured a wrap Seller finance wrap loan?

I've looked at a couple deals. Wrap is a perfect example of a strategy that you should have in your tool belt. It is an absolute— you can use wraps. I have not had a deal that was where the wrap was the correct structure for what I was trying to do. Cody, have you had anything that you've done specifically on a wrap? I know you've had one or two.

Yeah.

Cody's really good at this. I do like the strategy. Cody, you're more applicable.

So I did this on a duplex. And it was truly zero money down where I was basically making, uh, we did a new loan and I was making a big payment and out of that they ended up making their payment and they kept the delta. Definitely possible. It was with a real estate contract. I did not do that deal to make money. I did that deal to move a relationship forward, which I've done multiple times. So they had debt, they're trying to de-risk, and so I'm a more credible borrower than they are. I just, I have a lot more debt than they do. And so I was comfortable basically wiping that obligation essentially off their balance sheet. And so that's why I did the deal. But there was a zero-down duplex in Moses Lake, so it's possible.

Okay. Thanks.

What, what is a wrap?

So a wrap, think about it like, let's say Dylan has a loan for 50 grand. He wants to sell it to me. I'm for $200,000. I'm basically gonna sign a, a new loan for essentially the equivalent of $200,000, and I'm making a payment to him, and that's gonna cover his payment, and then he'll keep whatever's left over.

Yep.

But it's like a wraparound mortgage. You're just wrapping a new loan around the existing loan.

And so the existing one stays in place?

The existing loan would stay in place.

Okay.

Yep.

And Dylan, what's your podcast called?

It's called Alchemist CEO.

Hey there, Dave Snyder with general questions, 2-pronged if you will. And some of you say, we already answered that. Yeah, well, I'm trying to get clarity. There you go. One, if I don't have the budget that Christian has currently, but I want to build a personal brand, I can kind of show you and tell you what I'm doing, but I would like to hear just in general from from the panel in terms of what would you do? That's question one. Question 2, out of concern for having seen, you know, what you talked about, the Robinhood, I see a lot of that. Most everybody hides expenses. People have tried to buy significant properties for me and I can't find all of it. I didn't keep good records. So the second question would be how to do due diligence. I think, Christian, you just answered it, which was if everything you say is true and then this, that, and the other, and you do diligence. Any advice on due diligence would be question number 2. Those are my 2 questions.

Okay.

Thank you.

Let me tackle number one. Number one, the first thing I would do is exactly what Cody and I did. This is one of the few things that we did right from the beginning. If you go back to the beginning of the YouTube channel, it was originally just Cody's, like the first like 10 videos or like it was just Cody's YouTube channel. Then we just merged it and did it together. We told the story of what we were going to do before we did the thing that we did. And one of the sexiest things that you can do in all of business is call your shot and then actually do the thing that you said you were going to do. There was a girl, oh, what was her name now? It's been so many years. There was a gal at CoStar. We're just gonna call her Angela so that I have a name. She was super outspoken, really, really fun, had no idea what the product was. But we did this pitch competition with all 300 reps and she somehow, as a, she wasn't even one of the sales reps, she was a support staff. They let her also pitch the product. Uh, the CEO said, hey, whoever does the best job pitching this, and we did the same pitch for 3 straight days out of 300 reps. He's like, I'll just give you $100,000. Uh, she won the $100,000 and she wasn't even one of the reps. On the day 1 recap video of the sales conference, one of the highlight reels was her being like, gonna win it. And then she won it. And I still remember to today. She won it, and then she got promoted. She's one of the highest up people in CoStar, which is a massive multi-billion dollar company. She's one of like the top top executives at their company today, and it's mostly because she just said, "I'm going to win this event," and then she won the event. If you go in on YouTube or Instagram or Facebook, I've never figured out TikTok. I don't understand that platform. But if you talk online about what you're going to do, and then you do the thing you say you're going to do. It costs you absolutely nothing and it can be huge for branding.

And nobody remembers.

We made one. It's not gonna happen.

Oh yeah. And we said a few things, we're like, we're gonna do this. And then the video just dies. No one remembers that I didn't hit the targets, but they do remember when you go, I'm gonna do this, and then you do it, it lands. It's completely free.

Christian, could I share the secret that you implemented 30 days ago that's made you, given you millions and millions of views?

Okay.

Millions of views that no one knows exists.

Oh, oh, yes, yes, yes. That's not one of you. Sure. You're talking about the, the real, the trial. Okay. So one thing that I have found, if you're trying to get attention, so this is if you, if you know you have something to say, find something that you personally find interesting. This is, this is, I took over my media, half of my media for 28 days. And I brought my overall views from an average of 300,000 on Meta to an average of, uh, 7 million on Meta. And it was like no work.

In the last 30 days?

Yeah, it was like the last 30 days. There's like a little like side project that I was like, oh, that worked. Um, so on Meta, if you want to get a bunch of views, rapid scroll. Do not get addicted to scrolling Meta. Go through and be like, what video in your niche captured your attention? If you were like, I found this interesting, all you're trying to do is figure out why did I find this interesting and would my audience find it interesting? Take the video, screen record it, Post it. No edits. Just post the. It already did well. Just post the video that already did well, exactly the way it is. Don't change it. Do that one more time if it works and gets a lot of views, and then do a reaction video to similar things to that. So who has seen in the last thirty days with Christian just playing with this? Who's seen me do any content on squatters? We got like four million views on like a few squatter videos, and guess what I do? I have some squatters and I have some videos where I deal with squatters. So I took all of their views and then I just transferred their views to me. And this got several million people in the top of the funnel who now associate Christian with squatters. What are squatters associated with? Real estate. Now, of the people who are interested in the squatter thing, some of them, most of them, because millions of people are there because it's just catchy and it's interesting. I want to filter them out because there's one thing I know about them. They're not going to give me any money. They're not going to buy anything from me. My social media is a funnel. I don't want views. I want your money.

Investors.

I cannot extract money from people who are not interested in me and what I am doing. It's not the right audience. So how do I filter down that audience? I then will weave in content about the thing that I just talked about. So I'll talk about how you deal with squatters and as an investor. So I go from entertainment To edutainment, to education. And what the algorithm starts to learn is, wait, when Christian does the thing, a lot of people watch it. So maybe to the video that we would've sent to 200 people, we're just gonna send it to like 35,000 people. And so a video that would've been super high value, very low entertainment, will get 100 to 500 times the views that it otherwise would've got. And then if you slow down on views, you just repeat the cycle again. Do a viral thing, react to a similar viral thing, give a valuable piece of the thing. And then if you have videos that really worked in there, Dylan's like, dude, post it again as a trial reel because it doesn't show on your thing and you get to send it to new people all over again. But that worked for me. It took me like, I probably spent personally about 6 to 7 minutes a day. I keep trying to do it in 5 and I go just over. So I know it's more than 5 minutes, but it's less than 10. And it's like 7 to 8 million views. That's not inclusive of YouTube, which does a few million views as well. That costs you almost nothing. It's a free funnel. Dylan made it. Have you implemented it yet?

No.

Okay.

Dylan hasn't done it yet. When Dylan does it, Dylan will do the same thing.

Yeah.

It's literally just cheating. I hope that answers that question. What was your second question?

Due diligence. How do you sniff out when people are being deceptive? Because I've seen a heck of a lot of that.

What's your answer to that? Yeah, again, it's sort of the same thing that I keep preaching. It's just repetition. You need to look at everything in your market and see— you underwrite enough properties, you've repeated the process enough times that you can see a property that goes— like one recently, you know, I have a number of units, I've underwritten hundreds of properties, and I know that for a certain unit size, Roundabout, give or take 10 units. Trash cost is about $100 a month. There was a property I was underwriting that I made an offer on, and their cost for trash was $500. Like, I've looked at every single property in the area and it's roundabout $100, $85, $100, $120, something in that neighborhood. Why you're $500, I don't know. Went to Google Street View and sure enough, they had 30 trash cans all lined up and they're paying on each and every single one. Okay, there's an efficiency. I now know that that number is wrong. It's the same thing with all the other expenses. You can look at, you can very quickly figure out what, what are tenants paying for? What, you know, what are they being backbilled for? What are, just by looking at the expenses and knowing what everybody else is paying, like, okay, your, your utility cost for gas is 3x what everybody else is. Oh, okay. Everything runs on gas in that building. And the owner's paying for it. There's no electric charge. Well, guess what? The heat's gas, the stove is gas, the everything is gas, and there's very little electric. Or vice versa, every— the electric bill's sky high and there's no gas, almost nothing for gas. Well, guess what? The heat is electric. So you can very quickly figure out what utilities and what mechanicals are going on in the building as well, just by looking at, at the utilities. But you can't tell that unless you have something else to compare it to. So you have to do enough reps, underwrite enough properties to sort of start to see, hey, this is out of place. Okay, let me dig a little more into that.

All right.

Under— you know, is it enough to stop you from doing— going under contract? No. You shouldn't be doing deals where the difference between a $500 bill and a $100 bill for trash is, is a deal breaker. Do deals that are much bigger, that are— have so much meat on the bone that that stuff Doesn't really move the needle for you. You can be 10% or 15% or 20% wrong on your utility costs and be fine. But once you go under contract, then that's the time to sit down and sort of look through the nuts and bolts and figure out exactly what the— just ask for the utilities, call the utility company. What is it for this? What has historically been for this property over the last 12 months? And just trust but verify. Don't let the— don't let it stop you from going under contract, but then under due diligence, go and verify.

Yeah, I appreciate it. What I guess what I'm saying in the question is, if you have a, say, a V-meter on your soundboard back there, uh, on this side you have, I guess, what we call incompetency, and over here on this side you have deception. What I'm saying is This I understand. How do we get around this when people have other accounts and they're not showing it?

Well, just, yeah, the deception, you're going to figure that out really quick because you have a vast knowledge base that you know this is what it should be. 11 units is going to, it's not going to be $20,000 a month in utility costs. It's going to be $1,700 because every other 10-unit that's the exact same as what you're buying is is this number. So it's just you have to look at enough properties to know, you have to know your buy box really well and look at it, have fed enough properties through it that you have a metric that you can use, an eye that you can use, pattern recognition to identify when some, hey, this is way out of whack here. What's going on?

I'll do a very quick one on this. In multifamily, the nice thing is a lot of things do not do expense ratios as your end math, but you do run a quick, like, hey, an average expense ratio for property in this market is usually this. If it's way off, the nice thing with multifamily, it's boring. It's super simple. A deal looks like a deal, looks like a deal, looks like a deal. There's some variables with property, but if it looks realistic and normal, it's probably going to be more or less realistic and normal. If it looks abnormal, they're probably lying about something. In hospitality, it's wildly different. You get the same resort is making 50% different than it did last year. That's— the numbers are crazy different. You just don't see that in multifamily. It's actually a lot easier to detect, fortunately.

Okay. I guess where I was going was how do you sniff out and sort through?

Is it in line with the local expense ratio? That's the first thing to sniff out. Does this make sense on face value? Does it make sense? If it makes sense, then you'll, then you'll check the bank statements. And if all the utilities line up and the rents line up and the leases line up, Your odds of it not being correct are actually really low.

Let me say it a better, maybe a clearer way. And that is, if you're going through this transaction again, how, what question would you ask? Oh, in this transaction to prompt them to find the account that they were hiding?

Oh yeah. On this transaction, you would've found someone who's already done resorts. You would've asked them what this looks like. They would've said, these expenses aren't nearly high enough. Then I would've gone to the owners and say, how are you keeping employees at $60,000 a year for 8 people? And then I don't— how else would you answer that question than like, oh, you know, there's a couple of people who might be paid a little bit off books, or maybe we're trading some favors. Like, perfect, good data point. But that you asked a specific question about the line item in question is the answer to that question.

Thanks.

Thanks a bunch.

Yes.

Don't be an idiot when you buy a resort.

Um, just curious, I mean, maybe it's different or the same for each of you, but is there one relationship that has created the most value, uh, in your career?

Oh, uh, let's lightning round this for everyone.

Um, whether it's lender, vendor, or lender or contractor or partner or what, or other, or others.

Yeah.

One relationship for me, there, there's so many. The one that jumps to mind for me is, uh, Doing real estate with Caleb specifically in Texas. Caleb and I work together really uniquely where we have no overlapping skills, which is just like a phenomenal thing. It can also be frustrating, but adding him to the business increased our deal velocity, leaving me to close, which is the best thing that I do. I believe in everything that I say and I can get really excited about the vision of a deal. So selling someone on something that I absolutely believe in is the easiest thing in the world for me. I'm like, we have our project. Caleb is amazing at making projects appear for me to be excited about and for me to present and for me to lead. It's that one relationship, uh, finding the partner who had the skill was the biggest thing for me. Phil, one person, biggest difference, you.

Uh, but this might be cheesy, but these two. Um, uh, yeah, no, just, it was a cheat sheet to what not to do. I got to, I got to just jump over all of the hard lessons learned because I paid attention and listened. And it's just follow the path of people that have done the thing you want to do and follow. They'll tell you, don't do this. Don't be an idiot and do X, Y, and Z. Do what they say because they find the people that have done the thing you want to do and go follow the path that they did. But they'll also tell you what to eliminate. That was the most valuable. I haven't had some huge disastrous partnership. I haven't had a huge disastrous deal that went sideways and upside down and overpaid, or I just haven't. Because yeah, you guys.

Click the link below. Josh, clip this. Dylan, post this. That's an ad.

Cody.

Oh my goodness, you're tall. Well, so there's a gentleman over in Grant County, and not to put his name on blast because we're recording, but as of early next year, I'll be paying him about a million bucks a year in interest.

Jesus.

It's a lot of money. However, he has taught me in a way where I can buy assets without any of my own money that can generate more than that. Because I'm not in business to break even, and I'm definitely not in business to lose money. This is someone where if I did name them, you and I would not both know them. They're not famous. They have other assets in addition to that, but the First National Bank of Cody will be paying him $1 million a year starting next year. Right now it's a little over $625,000, so that's going to scale up another $400 grand and change. Very soon. But people have what you want, and he has allowed me through seller financing to acquire assets that can generate a large amount of wealth.

I just want to add to this in my world because as you were thinking about, as you asked that question, I was thinking, I don't know if there's one relationship, but then I processed if I had to get rid of every relationship in my world, Except one, who would I hold on to? And there's one key employee that's been with me for about nine years. He came to me when he was not in marketing at all. He was auto glass installer, and he got connected to me. Started him at three grand a month, which is like not livable wage. You know, for for for most people, he's got a wife and kids, and. This was 9 years ago. I worked with him every day, side by side. He moved out to Vegas to work with me over a period of about a year and a half and cloned him to know everything I know, to the point now where not only does he know everything I know, but he also knows he's significantly better than me at many things. I've had business partners come and go. I've had, I had at my peak 75 people in my organization. I had a sales team of 40 people. I had a massive office. I was paying $20,000 a month for my office space. And every single person, my friend came and looked at my org chart and said, just so you know, 10 years from now, you won't talk to any of these people. I said, yeah, right. He was right. Everyone except for this one person. So I'd say like my, that key person who you can clone or have integrated into your business, like a Caleb, who can then ride or die. Now he's making well into the 6 figures. Working for me as a job, and yeah, so that's who it is for me.

Thank you.

So this question is for Dylan, and your line of business: Do people use your business to create an investor pitch? And if so, can you give an example of how they would do that?

Yeah, so giving an investor pitch like a. Like a, hey, here's some investors, here's the opportunity. Do you want in?

Yes.

Yeah. So we do that a lot in a lot of different areas. We, I realized after in 2022, I had my best month ever in business. We did $2.3 million in sales in one month. And the next month my business partner disappeared with all of our money. And he was the main guy. I was the number 2. I was kind of like the operator behind the scenes guy. He was the guy who sold and did all this stuff. I had never sold anything more than a flying squirrel. I didn't really know how to sell. I hated asking for money. It was very uncomfortable. He put me in a room. I wasn't really good at networking. And I was looking at a $250,000 a month payroll, a $20,000 a month office.

Wow.

And $0 of— we had no recurring revenue. So I said, what am I gonna do? This is when I learned how to do webinars, one-to-many selling, where I can get 50 people on one call. I don't have to ask any one person for money. I just say, here's what I'm doing. If you're interested, here's a link, take the next step. And it changed my life. It allowed me to push through all those financial hardships, allowed me to build a business, and now We do set up webinars for other people. So one-to-many selling where you can invite a group of people on to a Zoom call and you just explain the opportunity. And if you're interested, you're interested. That's how we do it.

Yeah.

One quick, one quick note on that for multifamily strategy. Everyone who is a mentee in multifamily strategy, when you have a deal, I love this webinar funnel. The most recent one, I just got a A message on my phone like three hours ago. David Centaro, Centaro, David C. In our group, he just ran one. I will post it on the school community when you were doing the capital raise. It is the way that you do it. I'll help you market it so that you're not in SEC violation. But it is a webinar explaining your opportunity, how you are structuring your deal, asking for feedback, and a soft invitation for if you would like to learn more. Book a call with me. What I did on our last $10 million of raising, I booked one-on-one calls with every single person and I went through the same presentation with every single person and it literally destroyed my life for 3 months. I was just, it was every second I wasn't coaching, I was just pitching and it was the same pitch. It was such a better model just to bring everyone onto the pitch and the people who wanted to take the next step. Can just text me, and then it's it's more the conversation is more like hey let's get through some like logistics details of like how they're wiring the money and what the paperwork looks like instead of pitching pitch everyone at once. There's the easiest way for a capital pitch once you have called the people in your phone book your immediate relations next step always that webinar you can post those to our whole community David just raised three hundred thousand dollars. Only with the webinar. And he ran— and he ran 2 iterations. His first one, $100 grand. Second iteration, $200 grand. And he ran another one today, so ostensibly he raised more. I don't know, we'll find out.

Right.

The potential of the people on the, uh, meeting could probably let other people know also.

Yes.

Every time you sell anything ever, you always ask the other person, who else is this a good fit for?

Right.

That is an automatic sales thing. Yes, always. And it is amazing how many times that person has more people with money on a deal. It's the most common thing. Uh, someone who's an astoundingly talented capital raiser is Mark. Mark is very good at aligning capital. Mark worked on one deal with me and he is like, oh, I know someone else. And I was like, oh, that'd be really helpful. And then he brought another person. He brought another person. He brought another person. Matt's brought, uh, one of the like key relationships that I have on deals. They specifically want to invest in light tech. They are on our GP team for almost every deal. Literally just came in because I was doing a deal with Matt and I asked Matt, hey, do you know anyone else? He's like, oh, I do. And then they put $500,000 in a deal and it's been a fantastic deal. Uh, it literally is the best thing you can do in any sales. Always ask who else would be a good fit for this. It's like easiest way to make money.

So what is your, I think you said it before, but is it like a, Rate of return, an average of about 10% is what you said, right?

Cash-on-cash return. If I'm looking for an average day 1 where I'm really comfortable with it, like on a kind of bland deal with average upside, just average deal, 8%, really great starting point. If I have more upside, I'll go lower, but it must have positive cash flow, which means we have a DSCR. I really like to see that around 1.25 or higher. If I hit those metrics, I'm happy to go. Your full return is going to be a blend of the upside as well as the cash flow. So it needs to be a combination of the both that usually results in them doubling their money in less than 5 years.

Okay.

Thank you.

Absolutely.

So my question is around the expense ratio. For a quick analysis, when you look at deals on, on CREXi, Or LoopNet, would you consider? Would you know what the expense ratio is for that market for this size of apartment building and try to calculate that way? Because I've heard that yeah, that the expenses from the brokers are kind of trash, like sometimes. So do you use that instead?

Buyers are liars, sellers are worse, and brokers are worser. Worser than brokers do terrible math. That is why when Eric was like, absolutely consult your broker, and I was like, absolutely do not get their opinion on your math. They are there to sell you on the deal. They're there to get the transaction closed, and that is what they're paid to do. The incentives always need to line up with the objectives. They do not, they're not incentivized for you to do good math. They're incentivized to close the deal. And so you always know that with brokers. I love Eric. He'll never steer you wrong, but like, it's not a best practice with brokers because their incentives don't align. When I am doing deals like that, that is just my number one rule. So in negotiation, you should know for your market what is an average expense ratio. There's some markets that have really high property tax, like Texas. Our expense ratios are higher, but our prices are lower. They offset. But it's good to know what a normal expense ratio is. Cody and I definitely know what is an average for Grant County, and it looks a lot different than Texas. You should just know for your markets. In your case where you're looking at like, Washington and New York, they're gonna have different expenses. You should just know roughly what those averages are. If it's egregiously off, you know there's definitely a problem.

Okay. And then the second question is regarding, like, you know, for new, for beginner investors, like around, like, B, A, B, C, D neighborhoods, like, what would you start?

Like, Cody, this is a great one for you.

Well, don't do what we did and buy F. So that was a mistake. Wouldn't do it again. If it were me starting over, I'd be in C and B for sure, but I would've transitioned into A sooner. So I've been doing a big transition. Uh, my wife and I just bought, uh, our first 8-figure asset and it's a Class A deal. $235,000 a door, 56 units was, uh, for the purchase price anyway. And so super excited about that property, but I wish I got into that sooner. I had an opportunity to do it sooner, seller financed as well, and I chickened out. So get in and C to B, but when you can transition, I would transition up.

Can I add to that?

Absolutely.

It depends on who you want to rent to. The other thing to consider too is A-class is great. It's great stabilized long-term play. But in a recession, people can move down. So C and B-class, there's always going to be a tenant pool, especially C-class. Everybody always needs cheap economic housing or economical housing. So C-class, I like a lot because it's just always going to be a thing, and there's always going to be people feeding into it. You can come down, you can go up, but there's just always going to be people in C-class. Now, it's nice to have something a little nicer in that C-class neighborhood. Like, my stuff is sort of B-minus C in a C-class neighborhood. So everybody that's looking around at other C-class stuff, hey, this is a little bit nicer for the same price. Okay, we'll go with that. So, and then, then just consider who you want to rent to. Are you in a D or a C-class neighborhood where the people are really low-grade and they're going to cause you a lot of problems? Or are you in a little bit nicer part of town where you have nicer clientele? It's just who you want to work with.

And I think the answer at the end of the day— I'm going to swap mics. I think the answer at the end of the day is I really think that you should specialize in a certain asset class. You should find what you do best. Cody's like, hey, I'm really enjoying A and this really resonates with how I'm doing stuff. You should definitely keep doing A. Oh, I do C, so Cody should do C. I like C and B as well. I really do well in affordable. We keep it leased. It's simple, it's repetitive, and the problems that we have are consistent with those tenants. You still have problems with A tenants. It's just different problems.

Are these classes like actual— are these just opinion classes?

You're just like hypothetically that you generally would have A, B, C class properties or F? F is like the septic's bad. They're dealing drugs. It's just terrible. The roof's about to fall off.

It's not an official grading system.

It's a little subjective, but when you're in, it's one of those things. Yeah, it's kind of like, yeah, no, they post it on the outside of the building. They just tag it with A, B. If it's tagged with F, it's F. Elgin.

Good evening, gentlemen. Good evening. Incredible. Opportunity to come here and learn a lot of things.

I absolutely agree. Uh, listen, post it. I'm just kidding, he doesn't do my posting.

That's all right, he should. One of the things we mentioned while we were here but we didn't get into, and I think it's really important because it's an underlying theme that you gentlemen are talking about and that you guys are doing Including that young man who's doing an incredible job working through the, the diversity of losing all the money for your business. Business plan, business plan training.

Mm-hmm.

You know, we're trying to buy that first, second, third property. When do you get to the part of knowing how to make yourself bankable by having a good business plan and being trained on what's going to make you money In the long run?

I ask myself if I was the lender or the investor, is this business plan good enough for me to invest in? That's, that's basically it. It's like the, it's like the classic, uh, quote from The Office. I ask myself what an idiot would do, then don't do that. I basically just go ahead and say, hey, what, what needs to be done? Uh, I'll give it a practical example for what I did in the meeting with the bank last week with Caleb. Caleb negotiated the entire custom bank product. My only ask was, once we get on the pitch, just let me close. Everyone shut up and just let me say the thing. No one overtalk, no one overshare. Your lenders specifically. So this is for your business plan for a bank. Your lender is not your friend. If you give them too much information, they'll find a reason not to give you a loan. If you tell them what they want to hear, they're gonna be super excited to give you a loan. So you just need to communicate, what would I want? In this case, we identify what is the problem. They are low on occupancy because the owner lost their property manager, were unable to replace them, and they went from 95% occupied to below 70%. They're back up to the mid to low 70s, but they're struggling. The bank's problem, they do not want to take back the property because it's in a tertiary market. What is my business plan? I've already driven the property. So when they're like, okay, what do you guys think you're going to be doing at this property? I've already driven it. You saw the paint color. I saw the paint color. We need to repaint the building. It's just an ugly building. I also have checked out all the buildings around it. They're nicer and will never be as nice as those buildings. So I know what we are. We are a Class B- building in an area of B+ buildings, and we should be the most affordable building. In this area. We should still be way better, but we are not going to try to match their rents. And you could see everyone on the call, you could just see them calm down. They're like, they understand the asset. I'm like, number 2, the road. We're going to rip the entire road out and we're going to put a new road in. I'm ready to spend $1.5 million on that. We have to spend $1.5 million on it and it's going to be done. They're like, okay, good. No further questions. Those were our problems as well. A simple business plan. I've identified the problem. You don't want to— you want me to fill up the property so that we can pay you rent. Here's how I'm going to do that. Here's its position. Here's what I'm fixing. We'll find other crap when we're under contract and we'll fix that too. That's, that, that's the business plan.

Second, second question. I'll get out of here very quick. Multifamily strategy, deal debt equity. What an eye-opener. as a structure. So it's incredible because it's so thought-provoking. What was the catalyst that brought that together that has become probably our theme? This is the way we operate in this community.

Cody and I had the worst mentor that you probably could have. I mean, he was probably top 10 for It's pretty—

there's always worse.

Yeah, there's always worse, but it is worse than I've seen. Um, he was actually individually very amazing at being creative. He was, he was a fantastic mind for— he could just figure out a way to get everything done. The problem is he had absolutely no ethics to back that, which was the whole issue with him. What I learned from him that was positive There is a way to do almost everything. And funny enough, he was the one who told Cody and I, well, you can't do every deal. And Cody and I, I remember sitting on the stairs of his building right before he lost his building because he's an idiot. I remember sitting on the building being like, what if we could buy every deal and what would that look like? And we pretty much came up with, well, what is buy and hold? It's how do you buy it? And then you have to not lose it. And if you do that, You'll be rich. This guy had already lost all of his condos. He bought the offices. Cody and I looked at the deal when he bought them and we said, well, he's definitely going to lose this. There's no possible way. His deal would almost work if his rundown vacant building in Tacoma during COVID as office got the exact same rents that Amazon was getting in their new building in Bellevue. If he matched it per square foot exactly, The deal would just barely work.

Whoa.

But he got it closed. So what I learned is there's always a way to do it. Then you have to ask yourself, should I do it? Which that guy was incapable of doing. But that's how it came up. It was just, we had a bad boss and we learned cool stuff. It's just, I'm taking that pretty much accurate. Grab a book. Yeah, absolutely. Those are the rules. Box of book there. If you guys ask a question, grab a book.

Can I get a signature?

I suppose we could do that. Yeah, I have a pen somewhere. Absolutely. Find me later.

Hey, fellas.

Hello.

Um, I didn't have a specific question until I got in line. Wanted to listen. There's a few people through my journey that I've heard similar to the, the Cody story where you have a, a gentleman, um, that you come across That maybe they have nobody that wants their property in their current circle, right? They need to offload all their property in the next 5 years. They want to exit. Maybe they're 87 years old and they're done. Mr. Marketing Guy, is there a way to market to those individuals that are hidden amongst all of us that's like, yeah, they've built up portfolios over the past 30 years and they're like, I have nobody to give these to. I just want to transition them to the next generation.

So these are old people that a lot of them don't even have social media.

Yeah, no social media.

And many of them don't even have phones other than a flip phone.

Yeah, yeah, yeah.

Right?

Big numbers.

Yeah, yeah. Rotary phone. So here's my experience with them. Similar audiences is commercial real estate brokers. That want to sell commercial warehouses that have been in that organization for a long time. And how I've understood those people and I've helped those people is it's purely relational and there's no secret sauce. I haven't found some secret database where all these people live. And so it's purely just the strategy that I've learned from these guys, which is it's just relational.

So Cody does have a database where all these people live. There is actually a database that has every single owner. Okay, Cody, where's the one place that people can go to find anyone who owns a piece of multifamily property?

My phone. Google Maps. Yeah. So if you want a place to start, call up a title company, ask for a farm list, multifamily that hasn't traded in the last 20 years. You can then take their information, get the contact info from the internet because it's on the internet. You're going to hit their dialer system and then you can try and meet up with them.

Yeah, that's finding them, but not necessarily marketing to them. So basically—

Well, marketing is direct outreach. You're not going to— you just said they don't have social media. You are not going to run an ad that's going to hit them.

Yeah.

So direct outreach, outbound calls are the way to get to those people.

Basically, his answer was yeah. Do this strategy, which is well.

But you know, but Cody just gave you the how. I gave you like he actually gave the tactics. I just gave you some woo woo idea. But but but here here's the most important part is this concept someone told me a long time ago in dating, which I've learned has related into everything else in life. The person you're looking for is looking for you. The person you're looking for is looking for you.

Yeah, yeah.

But you have to become the person the person you're looking for is looking for. Are you the person that those people would sell to yet? That's what marketing is. We build the assets that speak to those people. So like, that's literally the car you drive. Are they driving a 1990 pickup and you show up in your Mercedes? they're going to say, look at this prick. So drive your F-150, you know. Are you wearing a suit or are you wearing overalls? So anyways, that's, that's my marketing advice.

No, I love it. Thank you, fellas. Appreciate it.

Hello, Mark.

Hello all.

Thank you for being up here. Thank you for a great event. So what triggers this is our last couple of adventures to city council and planning We're buying Cs, we're buying Bs. Cody, congratulations on stepping up to As, but you're not building many or any of them. When does the business case become we should start building this stuff? Because everybody teaches it's cheaper to buy than build. So where did all this inventory come from?

So Cody is building them, which is a perfect answer. I have a preference. Cody has a different preference. My answer is I like what I do. I did the Robinhood. I love the Robinhood. I'm never going to sell the Robinhood. I would never do this again in a million years. I buy deals that make money day one, and I add to my income and I keep it stupidly boring and I do it again and again and again, and it scales and I love it. Cody just did, you just finished building, you just got your CFO, right? For your—

For 2 of 'em and then the next 2. Yeah.

So Cody is literally building the buildings that he bought. He bought buildings, then he's building the exact same building. On the lot. So Cody, how has that process gone and how are you taking these, how are you taking what we talked about today and yesterday into development?

So getting into development violates like one of the most important rules in real estate. It doesn't cash flow.

Hmm.

And then it violates the next most important rule, buy below replacement cost.

Right.

You can't build below replacement cost. Turns out it is the cost. So that's pretty bad, right? So when do you get into it? You get into it after you have built a portfolio of buying assets below replacement cost. For those who don't understand why that's important, if I go buy a 10-plex for $1 million and it costs $1.5 million to build it, I can charge less rent than the people that are gonna build the similar product. And so I can outcompete any new competition. No one can steal my tenant base unless my tenant base wants to pay more rent. In new development, I'm at whatever return works for me. Like, I, I can't really afford to, to drop down to the same price as everybody else, so I'm gonna hold out a little longer. So someone else could go build the same 7-plex next to my 7. And steal my tenants. We're building it at the same cost. The reason we talk about buying below replacement cost is if it, it would cost $4 million to build the 39-unit that we bought for 2, so we could rent stuff for half the price of the new development, right?

Right.

39-unit. So that, um, you're gonna violate some rules. So when do you get into it? When you can buy a project that has land already attached where you can expand the property. Okay, that's where it's really going to make sense for your first few deals. So I bought 42 townhomes and then I'm building another 21. Started with 14, then I'm going to build another 7. I have another property where I bought— it has an acre of land, 6 apartments in the front. I'm going to build 10 townhomes in the back, but it came with the land, so I'm going to be able to build it for less than if I just went out and purchased land to build up. But I started with cash flowing real estate first, and then I'm only doing the add-on. I'm not just doing a standalone deal.

Okay. And then how do you— with how careful you are on making sure you make a dollar on every dollar you're invested, that all is unwound on the construction. I understand taking advantage of the land that you already have. We have big campuses on a few of our places or neighboring lots that would be nice to expand into. But are you just thinking, all right, this is not my today project, this is something that I'm going to own for 20 or 30 years because there's less maintenance, so it'll pay off on that long horizon? Or what's the motivation not to just use that same money to buy another '70s 10-unit?

So on the project where I'm just doing the expansion play, the type of loan— the reason I also like Class A is the dollar amounts are just bigger relative to the units that I have. So instead of, you know, $1,000 rent, like a lot of Moses Lake stuff. I'm getting almost $2,000 rents. I'm starting to get into the 8-figure loan size, which has much better pricing than 7 and 6-figure loan sizes. So I'm actually able to do this expansion play and pull out 100% of the money, not have any money invested and have a non-recourse loan.

Oh.

So infinite return on Class A.

Yeah.

From the get-go.

All right, thank you.

Don't forget that, Mark. Okay, this kind of piggybacks with that. Any downfalls of converting it from like a C to a B? Because I totally agree, like getting better tenants all day long. So we were talking, somebody was wondering if there's any downfalls, and to piggyback on that, Downfalls of converting one to a 55+? Like if we got that 22-unit.

Okay.

I, I'm, I'm fairly qualified to answer both of these. There is a certain class that your building wants to be. If you are in an area of all C buildings and you build an A, you're just going to have an underperforming A property. You, there's something that the building wants to be. Your question is highest and best use. So that example in Longview that I used is actually perfect. We are in a I would call that area a B+ area of town for the 200-unit. The average building around us, all of our competition is B+, A-. I do not want to be my exact competitor because I'm competing against the exact same thing. We are a lower-cost place where our tenants, and I look at the cars that are in the parking lot, I look at the tenants who are walking around. The average person is someone who wants to live in that area. and they want to be a B+ person who has a C+ budget. That is, that is what, that is the market that we are serving. I want to live in a nicer area than I can probably afford. We are the housing for those people. Knowing what we are, I'm going to be at crazy occupancy very fast because I know what I'm renovating to and I know what I need to do to execute the project. But it's really, the building will want to be something based on everything around it. Don't try to force it to be something else. Some people, we actually got rid of investors on all of our Afreda deals. I had partners who were like, we have a C property, we want to go A++. They were crazy. I was like, we don't agree on anything. This partnership is not going to work. We need to end this agreement right now. I am going here.

You're going here.

And I know Grant County. Everyone else is also going here. Going my way. But yeah, that's how you tell those. Well, you got a part two. Yeah, fifty-five plus.

Two unit like yes because I think it's like sixty-five percent right now. Fifty-five plus. So just like converting that.

Oh, it's already partially fifty-five plus.

Well, I mean just by nature.

Yeah.

Oh, oh, by nature.

Okay. So we were like, oh, as we have turnover, we could just intentionally market it that way.

I would spend the time to identify what is the need of my area. We turned a hotel— this is not my business model. The highest and best use for the hotel that we converted is people who get out of prison have midterm housing that the state pays for.

Mm-hmm.

It is needed in that city because there are zero other buildings that are doing it.

Mm-hmm.

It is just what it is. Best use for the building helps the community, makes money, keeps it leased. So with 55+, if I'm in a market that does a good job servicing 55+, probably not interested. Most markets are grossly underserviced for 55+. This is the year that the first boomers start turning 80. The oldest boomers just hit 80. So we're getting more demand than ever. You're likely a pretty smart conversion. We love 55+. I would just do some market research before I just said, yes, this is a good idea.

Awesome.

Thanks, guys.

Absolutely.

Clarifying question on the A's, because we hear, you know, Grant Cardone's tribe loves A's, and you explained why you love A's. If you hit a recession or correction, say another '08 situation— kind of hard to replicate '08 because you don't have the stupid 125% equity, everybody's had to qualify, you don't have the same thing— but if you did, How does that impact the A? And I'll tell you why. I live in— 22 years ago bought a house on green number 11 of a gated golf community here. Over here's another nicer gated golf community, and they built an A right in between them. So you can go get a golf membership either place, and they're gorgeous, amazing. And they booked up fast, really. I mean, you go to the Porsche Club, hey, where are you? You're new.

Oh, great.

Where are you? We live in the Ash. They're buying. I mean, these people that could buy anywhere, they're renting in these A's. So how does a recession fit A's? And I doubt I'm buying an A tomorrow, but how does a recession affect you in the A's?

Sure, it's going to hurt. Absolutely. But debt coverage is everything. This is the same thing I talked about for math yesterday. If you're at 1.25, Probably shouldn't do Class A. Not a great idea. I have some at that debt coverage ratio right now. I'm also 26. Like, I'm trying my best, right, to upgrade. You can't have everything all at once. It's going to take time. But as time progresses and I don't keep levering those up, those actually start to get paid down, get them to the 1.5. Like, if they go from 1.5 to 1.1 or down to 1.2, like, not ideal, but I'm not going to lose it. Right. Those will get hit the hardest. I also didn't get it into Class A until my wife and I became the largest private landlord in the county. But, you know, we built a massive business of Class C and B. So even if we take a big hit on this, which now that I'm saying it, I don't want it to happen. Right. But we could survive.

You're resilient.

You can make it.

Yeah.

We have the workforce housing in the Class C and B. We've got hundreds of apartments like that, and you cash flow a couple hundred a door on hundreds of apartments, you can take a hit on a little 56-unit Class A building.

Thank you.

So I think I've found a solution to my financing problem just by being here this weekend. I feel I'm two-thirds of the way there. I think I'm going to try to get a conventional loan and I'm going to try to talk the seller into taking a second position on the down payment. My dilemma is, where do I come up with the money for capital expenditures? Any suggestions?

So for CapEx in every deal, if you have CapEx that you're doing, it's just part of whatever capital raise you're doing. Capital raise, unless you have crazy cash flow, like there's absolutely insane cash flow, you're probably gonna do it through equity. It's gonna be the equity. You're gonna have other investors who fund the capital upfront for the deal, and you wanna raise about 1.5 times what you think your CapEx budget is.

Right.

I was thinking $200,000, but after hearing that, probably more like $300,000.

Raise $300,000, spend $200,000 if you hit on budget. Then you just get to send $100,000 back to the investors. Bonus. We have extra money. We don't need it. Much better conversation than, I need more money.

So doesn't land too well.

Do you think you could, or I could talk the owner into financing the CapEx?

Sometimes.

Phil's shaking his head. No, this guy's fucking crazy.

But sometimes it depends on their Position.

Yeah, I, I have, I have had owners actually suggest in the offering, hey, I set aside the deal that we're doing and, uh, looking at doing in Waco. We're, we're not under contract for it. I actually am not going to do it right now. I might do it in a year. The problem that they are specifically trying to solve is I don't know how to do this reno. We set aside money for it. The pitch that they gave us is if we can assign our note to you, we'll give you money for the reno. So I had a pitch for a huge property, like 270 rentals, where they were like, hey, we will pay you to take the building. The problem is there's a reason they're paying us to take the building. It's, they've screwed up their, it's student housing. They screwed up their pre-leasing. There is one year where this thing is going to be in pain. So I pitched that particular deal is a very unique clause that we didn't cover here that I won't go into in depth, But that is the lease option. I need to take over your management to get this in a condition where we could purchase it. It is an untransferable property in its condition. I need to fix the core problems. That is the answer to that. But there are occasions where the seller will pitch, I'll pay you to take the property. I'll pay the reno. It does happen. It's super rare, but it happens.

I had a situation similar. Yeah, it was a deal. The seller that I bought my first and second property from, they had a third and he was calling me how to, hey, how do I do what you've done to our last 2 properties? I want to do to our third. I'm not going to tell you how to make the property worth more so that I have to pay more.

So that's—

Yeah. Then he came to me, he's like, well, what if I partnered with you? Like, well, okay, what would that look like? And we started looking at Like, here's what I do. I bring this much money. You're going to have to bring this much capital so that we can go and fix all the problems. So essentially, this was a seller finance deal where he was funding the renovations. We ended up doing, you know, I went through the property and we found massive sewer problems and flooding problems, and I just, nope. But the only way he's ever going to sell that property is he's going to have to either fix all the problems. It's just not bankable. It's That's, that's a situation where the seller would want to fund more than the purchase price or seller finance 120% or 130% or whatever the number is.

Right.

Um, yeah, it just— the properties have to be pretty rough where that makes sense.

As we're coming up, uh, close to time, we're a little bit over time, but we knew that was gonna happen. Do you guys mind if Sam asks the next question just because you haven't had a chance to ask a question yet? I want to make sure we get some Be my guest. Any questions in there? Thank you so much.

Yeah, I haven't asked one yet, but I gotta get one in. Um, I found myself— I do not, I do not like social media. Um, but I find—

Neither do I.

I find myself using it more and more in my business all the time to vet tenants, to make connections, to find contractors. I find it kind of a primary way to do this. What would you guys say? I feel like I'm also missing a lot out on a lot of opportunities just because I'm not posting what I'm doing. I'm not posting renovations, I'm not posting acquisitions. What would be like a first step as far as what role would you see it playing in a business and what would be like a first step to start?

The one thing I can 100% tell you is that when you start posting content, especially when you don't want to, you will be bad. And that is okay. We start out as bad on just about everything. But what I would do is I would start telling the story. No, if, if no one knows you, they cannot interact with your business. That is just a, a fact of business.

Right.

But it's completely free to tell the story. So I would, I would, if I was to start over with no skills, so if I had absolutely no idea how to do it, I would look at my niche and I would say, what people in my niche, maybe look up a hashtag or a, a, a You know, search a phrase or 2 of like, hey, what interested me when I spent 30 minutes looking through this niche? If I'm gonna start content, what worked for them? Which means it got engagement. What thing had a lot of likes, a lot of comments? If it interested me, it probably interested someone else. I should do something like this. It's a great starting point. Just build off of the success of someone else. And find your voice. That would be my advice is just start doing it.

Okay.

And you're gonna be terrible at it when you start. I still haven't figured out how to get good at it. I just do it enough where sometimes it works.

Yeah. I was kind of thinking like, is this something worth like hiring? You know, I see all these, you know, like Dylan probably knows all these. There's like these Fiverr people or to get them doing content for me.

It is so easy just to post something.

Okay.

Don't outsource it.

Okay. I just don't like it.

Yeah. Don't outsource it until you've done it a little bit, but don't put a lot of, like, don't put a lot of effort into it. Do an honest video of what you're doing.

Okay.

Post like once or twice a week just to get used to doing it. Someone will find you and all of a sudden they'll, they'll have an idea of, you'll have a deal and you'll talk about it and someone's kind of followed you for a while and they're like, I would love to do this deal with you. And you're like, wow, I just made a, we just brought in a ton of capital because I did one post.

So Yeah, I made one post as a trial and then I was amazed at how productive it was because I had people saying like, hey, I got some off-market properties. Hey, hey bro, I got some of these. Hey, were you interested in this? I see you're buying it.

Is that your main focus right now is buying or what's your main focus right now?

Yeah, correct. Mainly acquisition-based.

Acquisition-based. So I'll tell you this, once you— the best thing to use social media for is to get other people behind your mission. My mission right now is to build the number one agency for coaches, consultants, course creators, experts. Um, I've created a community of people who are rallying behind that mission and, uh, I will make content and people will come into opportunities, will come outta nowhere. Some guy that I forgot about from 10 years ago will be like, dude, I'm doing this or doing that. And you'll see that, right? So number one, I think it'd be like share your mission and like what the why you're doing it. Um, and then number two, Um, uh, it's being clear about what, what you're doing with the, the buying.

Okay.

Um, and, and speaking that out and shooting content. So what I would challenge you, what I have a question for you on is why are you feeling resistant? You said you don't like social, social, social media. Why is that?

I feel like I have enough problems being on my phone too much.

Okay.

And I'm just like, I don't, I don't wanna be on it. I don't wanna be at, at night. I wanna be on it during the day. And then just be with my kids, be with my family. But I'm like, hey, maybe this is part of building a business. Like, this is part of the delayed gratification. I just got to do this. I got to build this up. But I do see a tremendous opportunity because I know there's a lot of investors locally. People know who the main investors are, and it's like, hey, oh, you got this property? Hey, you know, so-and-so I see all the time on, you know, the investor group in Rockford or Facebook. People know who the guys are on social media because are posting all the time for a long time, and they— it's everyone is just like, oh, you should talk to so-and-so. Oh, you're looking to get rid of that thing? You should talk to so-and-so. He would take it. So I know there's—

So you're concerned that you may spend too much time on social media, may get you sucked in?

That's, that's one concern. Yeah. And I just don't like the, all the interactions and replies, and there's drama, and there's, you know, you're one of those landlords trying to do that. You're, you're trying to keep the people, you know, there's, it's just I'm just like, I don't. I just want to go do my thing, and yeah. But I know I'm missing out on a big opportunity. So that's why I was like, is there any way I can outsource this? But I'm happy to do it.

I feel what's your market?

Rockford, Illinois is where we're.

Oh, Rockford. Yeah, I would challenge you.

There's just a lot of. I mean, real estate's growing in popularity. It's everyone's wanting to get into it. It's just this. There's a huge social media buzz in our town, dude.

Hundred percent. So number one, I would challenge you to make a post before you leave.

Here.

Okay.

Uh, while you feel like, you know, some kind of motivation.

Yeah.

Right.

Just like I would say, like, I've done a couple and then I was like, ah, yeah.

I, so I would challenge you to do that before you go. Number 2, um, if it really is the so, like the time-consuming thing, there's apps you can download where you can limit it to 10 minutes a day. And you, and if it's more than 10 minutes, it'll lock you out.

Yeah.

I get sucked in cuz I'm like, I'm gonna go on there and do a post and I'm like, Yo, my buddy just did this. Yo, so and so.

Boobies.

Oh yeah.

Like, oh dude, dude, you went, you just caught this fish and whatever. Like, oh dude, you're in Australia. So I just get distracted.

No, it happens. Um, 100%. Um, so an app, you can also make it so that certain apps, uh, go like black and white.

Okay.

And then the third thing I'd say is you can, have you heard of Fiverr?

Yeah, I, I kind of mentioned that. I just see there's these guys on Fiverr who will do Certain amount of reels for you per week, or— yeah, I actually, I did just create an Instagram and I just started trying to build it because I'm like, I'm gonna need this someday.

So you can find people for $200 a month who'll, who'll do that for you and you don't even look at it.

So, okay. I was just trying to— yeah, experts tell me what I should do.

Do it a million percent. You brought it up for a reason. Like, dude, do it. Yeah, yeah, change your business.

Yeah, do that. Okay, so you're building an Instagram. Everyone follow his Instagram. I'll, I'll I'll share the spelling of your last name because your last name spelling is, is, is kind of crazy.

And if there's a hater, we will all reply, screw you to the hater.

One, one thing that I do for this is I have a little timer that I just flip over for, it does literally every single task down to 5 minutes. Um, I know for every task how long it takes me, which makes my time management amazing. I know that it takes me more than 5 minutes and less than 10 minutes to write, uh, to, to film, edit, and write a pretty decent post. If I wanna do something, set the timer, when it goes off, I'm not doing social media anymore. That's the easy way to do it for me. Uh, comments, never read an Instagram comment. I don't know how to open the comments. I have literally, I don't, if someone says something to me, I don't know.

Okay. So you're not replying or doing this or that, or?

No, I did hire that out. You don't start hiring that out, but I literally have never, I don't know where to open those. I don't know how to do that.

Gotcha. Yeah, no, I appreciate it. Cause I know it's a big opportunity that I'm not, I could easily tap into. Cause like all I have to do is take pictures of what I'm doing and post it.

Less than 10 minutes a day. That would be, I think, would be the thing. You don't need to be an influencer. Just people need to know that you're in your space is the easiest way to do it. Thanks.

Yeah.

Great, great question, Mark. I'm gonna have you as the, I'm gonna have you do the final question of this run, and then we're gonna go dinner, which means everyone can ask questions there too. Just we'll not do 'em on stage. Um, Mark.

So thank you. When I was, uh, in Abilene and Longview, The property most like us, the 200-unit, is doing dynamic rents where they're changing them every 2 weeks. I'm studying a little bit in self-storage and that's a self-storage tactic. And then the Abilene 3 Class A's, they all need to do it because they have 18-month waiting lists and they're being stupid to stick to those rents. What do you think of dynamic?

If you want to make way more money in everything, dynamic pricing for everything. Okay, so we do 2 levels in hospitality and in multifamily. I will not do a long lesson on this, but dynamic pricing. All this means is that your pricing changes based on demand. Everything is based on supply and demand. Everyone should do this. When we bought the Robin Hood, they had set prices. They set their summer prices in the winter. There was no thought that went into it. We do automatic dynamic pricing for every rental that we have portfolio-wide. The system does an analysis. It says what rent will be. That will be the default. We then at the end of every single week, okay, get together as a management team and decide if we disagree or agree with what the automated variable pricing is. So dynamic pricing is both automated and then backstopped by humans because it's so important. If I have a building that goes from 90 to 60% occupied, which happened to Caleb and I a year ago in Stephenville for a 26-unit, We are not still getting— we've placed a ton of people at $950. Drop it to $700. Stop the bleed right now. Dynamic pricing. Fix the problem. We started signing 3 leases a week. I was like, ooh, we dropped it too low.

$850.

Back to $900. We're now renting at $1,050. We just finished solving the problem. We're now renting for more than we were. Dynamic pricing absolutely matches your income. Like a must to make money. Excellent question.

Okay.

No one has ever asked me that in 5 years, by the way.

Okay. Well, I was just surprised.

I've never been asked that before in my life. It's one of the most important things I do. I just— it's never come up.

I didn't know we were doing that, so thank you.

Oh, absolutely.

And those 3 Class A's, I don't know why. Why would you sit with an 18-month waiting list when you could just start testing for their 18 months? But here's our fixed price. Corporate changes it every 10 months. How— that to me seems stupid.

A lot of people are set it and forget it. The more attention you give— I actually learned this. Dylan said you had a saying for how money flows with attention. What is your thing? You had a specific saying about money and attention.

Where attention goes, energy flows.

That's it. Where attention goes, energy flows. What I found is where attention goes, money flows. When we pay attention to it, it makes more money. When Dylan said it to me, I'm like, that sounds like a corny Tony Robbins thing. I'm going to throw that out. And then Caleb's like, well, I mean, we should try it. Literally every time we have a problem, Caleb's like, let's focus on it. And then it makes money. It's literally every single time. Like, okay, well, fine. It's hippie dippy guru. Hey, we put energy at it. It made money. It literally works every time. It's the best piece of advice Dylan's ever given me. It's probably made me like $2 million.

All right.

Thank you, Dylan. Thank you.

You're welcome.

All right, guys, we are going to do, uh, so for the VIP specifically, uh, pizza dinner in the pub. One announcement one more time. If you are here and you are not part of the mentorship, I do want to meet with you personally. This is not a sales event. If you're interested in joining the mentorship and you're looking for community, if this resonated with you, I do want to talk with you. I have something for you. If you're like, I came here and I got everything I wanted, also completely awesome. You do not need to spend money with me. But if this is a community that you want to be a part of, there are a ton of people here who have done deals or are about to do deals in this community. We would love to invite you into that formally. Please find me. I will talk to you personally about that. And if it's a good fit for you, we'll make it happen. For those who are VIP, pizza's in the pub. We don't have that many. I don't think we had that many general admission. Talk to me. Talk to me as well. As long as we have enough pizza, I'll open up to everyone. But for the first 45 minutes here, if you're VIP, mosey on over to the pub suite. Otherwise, guys, thank you so much for making it out. Huge round of applause for our speakers.

Thank you.

Thank you, guys. And thank you for traveling to our really remote resort in the middle of Washington. I appreciate you all.