Simple Hack to make Millions as an Entrepreneur - Find New Problems

Hello YouTube, it's Christian Osgood and I am back this week for episode 10 of Rules of Real Estate. This is one of my favorite ones because it's you need to find new problems. If you haven't seen it yet, I covered this on BiggerPockets episode 605. If you haven't seen it yet, check the link below. However, we're going to dive into in this particular video how to move quickly, how to benchmark your progress, and really how to build a business. I'm gonna keep this like everything, very, very simple, but this is one of my favorite topics, so buckle in. If you are working on anything, this could be your marriage, your career, financial freedom, whatever it is, you're going to have problems. Your problems today cannot be the exact same problems you have 5 years from now. This is where most people get stuck, is they have the same issue. One of the big ones is analysis paralysis. Hey, I don't— I'm not confident enough to close on the deal because I just keep analyzing and analyzing. I don't know how to pull the trigger. Very, very common problem. If that's you, there's a lot of people there. However, if next year your problem is I'm stuck in analysis, I don't have the confidence to buy a deal, you're stagnant. Your business is not a business. Your target is not being reached. You need a new set of problems. When we started this journey, We started with almost no real estate. Now there's other problems down the road. I don't know anything about some of the legal. Some of our documents are very creative. I didn't know anything about accounting. We dove in. Well, you don't have to account for money you haven't made yet. So what did we do? We went out and bought the real estate and made money, and now we created an accounting problem. Now some people go, "Oh no, my business died because I didn't figure out accounting." Well, the alternative is you go and you figure out accounting. So what did we do? We figured it out. Now we have some of the best sets of books in the industry for all the real estate, for all the companies. Everything we do has stellar bookkeeping, and we're going to keep it that way. Well, now we're on to new problems. We've scaled fairly large. Cody and I can't do everything between coaching, property management, buying real estate, um, just being a spouse and a family member and having a life. Things are starting to fall out of balance, so what do we have to do? Now we're learning how to hire more people and create teams and communities. Am I a master of this yet? No. Is this gonna be a problem that I'm dealing with a year from now? Absolutely not. We're gonna have a whole set of brand new problems that we're gonna be sharing here on this channel with you. First thing you need to do to move forward is you need to identify where are you stuck today? What are those bottlenecks? 'Cause you can't solve a problem if you don't identify it. Which is why you need to be looking for problems, not looking for deals, not looking for money, not looking for opportunity. You're looking for problems because within your problems is where you find the most opportunity. If you can clear that problem and onto a new problem, preferably a bigger issue, now you know you're moving forward. That is how you benchmark success. I'm gonna tell this in another story specific to a deal that we've done. So right after we closed on our 38-plex, 3 duplexes, most like side-by-side seller finance deal, we had the deal, but we just tapped all of our capital partners to buy the 38-plex. We had no money of our own leftover and we didn't have investors ready to go. However, we had a deal that we loved. The price was right, the cash flow was there. We had to raise $90,000. We were temporarily completely illiquid. Now the options are you move the close date to get more time, you cancel the deal, or you commit to the problem and you solve it. What I ended up doing is there's actually an investor in our network I talked to a while back who was trying to get into a whole bunch of syndications. And disclaimer, we do not syndicate. He wanted to get into a whole bunch of syndications to reduce his personal tax burden. Now, generally speaking, that's not something I really deal with a lot. In this deal though, I got to talk to him and I went, well, what are the options? Sat down with legal, what are the options for who claims depreciation on a deal? Can you do with partners what they would try to do in a syndication? Turns out the answer is yes. When we went and proposed the deal to someone, he went, oh, you know what, I actually figured out the tax burden thing. I got into a few syndications. I'm "My CPA says I'm fine. However, I have another goal I wanna share." Okay, well, he cleared his own problem. Let's look at his new problem. New problem is, "I'm hit and miss on whether I make money in real estate. What I want to do is double my money once every 5 years. I put it into real estate, every 5 years it's twice as big." Well, here's a new opportunity. We had to raise $90,000. Loved the deal, loved the price, cash flow was good, but didn't have a lot of room to service another $90,000 note on top of it. We would have been slightly cash negative. The proposal was, what if we just double your money in 5 years? We're buying under market rate today. I'm willing to bet that after new management, renovations, and all the projects I've already done on that street before— these aren't new problems to me— we'll have a property that's worth more and there'll be no problem cashing them out. Today, we have enough equity in those properties to cash them out. We're working on doing that very early. This was a deal we did 7 months ago. We have 5 years to make it happen. We're likely to do that this year or early next year. Cycle the money out. He's happy. Don't let the problem stop you because now the problem became, okay, well, I have 6 more units. Let's figure out the property management. There's a couple of tenants that needed to be either adjusted or worked with Section 8. We got new problems though. We cleared the old one, you move forward to the new one. This video is fairly simple, but I think this is the thing that a lot of people forget. This doesn't just apply to real estate. Wherever you're stuck, the biggest thing you have to do is you have to identify it. If you have a business partner, a spouse, a best friend, it really helps to communicate these problems to other people. If you can put words to them, vocalize them, and commit to, hey, This is not a problem I'm gonna have in the future at all. Done. One more story I'm going to share. 12-plex, one of the first properties Cody ever picked up. This was a class— I'm going to call it a D property. It was performing great cash flow, a lot of deferred maintenance, bad roof, bad plumbing, super old electric. Some of the units were really nice, some of the units were extremely gross. Like really, really bad. Cody had a deal and an opportunity at the age— I believe he had just turned 20 at this point, picked up the 12-plex. He brought the value up on that and needed to get some cash out to buy out his partner. Well, here's a new opportunity. This is where I started partnering with him. We were already on the 38, we're already on these few units. Me and one other investor bought a piece of the equity that he'd created. So Cody bought a property zero down, fixed it up, needed money, and then we bought into just new equity that was created. It cost Cody absolutely nothing. And now with a team, we got to pool resources and start repairing the building and really making it nice. Today it has a brand new roof. Last few pieces are going on this week. Big roofs, massively, massively improved property, getting painted in 2 or 3 weeks. Adding fences, landscaping, the whole nine yards. We're taking a property that was kind of a piece of junk, a really well cash-flowing piece of junk, and making it one of the prettier properties on the entire street. New set of problems. You take the problems today of, oh my gosh, all this deferred maintenance and there's all this garbage, face it head-on, come up with a solution, move past us, or move past it, Now the problem's gone. That property, we're out of problems. Like, it's just a finished property that's performing at market rate. It's fantastic. Now we go buy new deals because that no longer takes any time. So hope today was very helpful. It's a very simple topic, but if you keep this in mind, this is how you go really truly fast. If you're just constantly blowing through problems, finding new problems, bigger problems that just make your other problems pale in comparison, you're going to have a different level of success than you're used to, and it's going to look unusual to everyone around you. That's exactly where you want to be. So if you haven't yet, like, subscribe, follow the channel. If you haven't checked it out yet, themultifamilystrategy.com, we have all these rules here, uh, short form, but exactly how to knock them all out and more. Check it out, link also below. See you guys on Wednesday for Whiteboard Wednesday.