The Biggest Mistake New Real Estate Investors Make (And How to Fix It!)

You don't have to be great at everything, but be excellent at the things that you're going to be excellent at. I would rather be excellent at 3 or 4 things than be okay at 1,000 things. Welcome to another episode of the Owner Meeting Podcast. I'm Christian, your channel host, joined today by my lovely wife, Dani Osgood. The two of us have built multiple companies together. We have bought a lot of real estate together. She's worked in some of the PM companies. She is one of the owners of all the real estate we do. We do a lot of projects together. Today we're going to be talking about one of the biggest mistakes that new investors make. We're going to be talking about what it looks like to correctly do a project. A lot of the money you're going to make in multifamily is based on how good of an operator you are. We operate as a team. We're going to talk about how we work together. More importantly, what you need to do to run your business as profitably as humanly possible. So, Jenny, Danny, welcome back to the channel.

Thank you.

So one big thing that I've seen a lot of new investors do that I wanted to cover today, because I think this is a really, really important point for people. They buy these deals, especially when they're buying low down deals.

Mm-hmm.

They're gonna buy deals based on the cash flow, which they should, but they're gonna do the project based on only the cash flow. They're gonna say, hey, I can do this deal for basically no money out of pocket. Mm-hmm. And so I'm gonna raise exactly what I need to close, not what I need to do the project. And then we'll let the tenants pay over time and we'll fix the project. So maybe we have a vacancy here, a vacancy there. We're doing rent increases. When we have a move out, we'll just do everything one unit at a time. Yep. We've learned that doesn't work very well. Uh, Dani, what, what does it look like in a building where we have done that?

Uh, it's very slow and very tedious. I feel like we're always in a constant project. I mean, we always are running out of money. We have major issues that come up that we just are not prepared for. So Christian and I pivoted and we decided that was not the way we were gonna go. We decided that we needed to always have contractor quotes at the start of the projects, 6 of them, and get the whole project done.

Yes. And you're always going to go over budget with contractors, almost always. So you're going to budget for the whole thing. A great analogy that I thought of this last week was like, if you try to clean your entire house one room a day, so instead of like just getting the house clean, you're like, oh, as long as I'm like always cleaning something, it should be okay. That's kind of like running a building on cash flow. If you don't have a lot of real estate, I think this will be relatable. However, if you just go and clean the whole house, now the house is clean. Now you have a base level. Now you have a clean house and you can really start maintaining things and keeping them clean. Piece of real estate's the same way. It's cash flowing. There's a move out. The money that you just allocated to start fixing the building goes to the move out. Stove goes, you replace the stove. What ends up happening is your building slowly, slowly gets better. And what could have been a 60-day project becomes a 2, 3, 4 year project.

Yeah, it's very tedious.

We've had buildings where the rents, like we weren't able to do rent increases we wanted to do in year 1. We had rents at $550 and we could not afford the move out. You can't rock the boat if you can't afford to get wet. We just did not have enough reserves in the account to get through the project, so we had to wait for it to regenerate. It took time. Every single vacancy is loss of income. That additional income helps get you through the project. The only way to do it is to get your contractor bids up front, scope out your entire project, not just the close, and then you go finish it. And we do this, by the way, we recommend the same thing to our clients when we run property management, which we're going to dive into some of our best practices there as well today. What does it look like on an average deal when it's executed perfectly? What happens from the time that you close to renovations to lease up? Like what does that process look like high level?

So high level is when we find a project that we love, we then immediately get inspectors and contractors in. Inspectors because they catch major things that we would not see otherwise. And then once the inspector says you're good to go, get your contractor quotes, we get the contractor bid out for everything. Once we have those quotes, we know how much money we need to bring into the project and how much money we need to have in our bank account on day one. Once we close on the property, then we get to immediately start. We start with phase one, which is the quick turns that we can quickly get our profit back up, and then we go into the medium and then heavy turns, and then eventually the whole project is done and it's done really quickly and consistently. Versus if we just did it very slowly as people moved out. It just turns into this kind of like patchwork quilt of a property where it just doesn't feel cohesive. You don't know what's going on in each unit anymore because it took so long and it's just, you really lose control of the project at that point. And so when you do it all at once with the contractors up front, the project actually feels completed and then you see a bunch of cash flow after the project's done.

And one of the things that I really like about that is the lot of cash flow part.

Yes.

I like the part where the properties make a lot of money and that should be your goal too. Yeah. That is the most effective way to get there. If you're buying real estate, it's not like, hey, how do we spend as little as possible to try to juice the cash on cash return? It's how much money can we make in how little time, effectively, responsibly, while creating an excellent building and fantastic, safe, wonderful places to stay for your wonderful tenants who pay you every single month. Yep. Like that is the name of the game. The other thing that I found is that we got limited on projects. We got stretched really thin. We're running a PM company. It's impossible to have the best course of all time, but I would say the most, we're running the most effective multifamily strategy. Like that is the most effective where someone would join and they actually go out and just buy real estate without being sold anything else. We're running an education brand, running a property management company. We're contracting our own renovations on our own portfolio and we have hundreds and hundreds of units. I found one of the biggest drains on that system are the properties where we did not buy them with enough reserve.

Yeah.

It's the ones where it's like, hey, we're not going to get through this for another 3 or 4 years because someone has to write a huge check. And if you have, say you have 3 partners, I'm not going to write the check for all 3 partners. Everyone has to agree. We put together a deal based on a certain amount of money. It takes so long, you end up with a never-ending project. Your ability to go out and just do more projects and make more money, disappears. You get bogged down in one project. One such project that we get bogged down a lot on is the Robin Hood Village Resort. We talk about this a lot. Beautiful property, really cool deal structure. We brought in enough money to run the resort, not to renovate the resort, not to fix cabins as they move over time. We bought enough to run a product that would, what would work really well in my opinion, yeah, is if it was one owner and he came in and you're like, hey, I'm making all this money on all these other businesses, I can go ahead and just put it into the Robinhood. What does that look like on a, on a partnership structure level? Like what does it look like to try to get projects done when the bank account has less than you need to do your renovations?

So what happens is the projects don't get done very well. So if you only have a $2,000 budget, you're only gonna be able to put $2,000 into a unit. Which you might have to miss some things and skip something as, as well, which then it doesn't feel completed and you might not get the tenants that you want in the units as well. Hmm.

Well, in the case of the Robinhood, it's the, you know, the, the quality of guests that you want or the, what I really see it come down to is the total amount of like the nightly stays, the marketing budget, everything gets hit when you can't keep a full resort.

Mm-hmm.

It takes a while to get cabins online and it's the same thing with multifamily. It takes a long time to get units leased if you're waiting for the next check to order the contractor and then you're waiting for the next check to install the next stove. And now you are, you've lost the first 2 months. Mm-hmm. And now you're marketing the unit online and now you might get a tenant, which is usually just around the time another tenant wants to move out. And it's just a never-ending cycle. You don't lose money if you bought right. Yeah. But you never finish the project. And that is one of the things that, The two of us, we were talking about this earlier today. We were talking about this too the whole week. That's why it's so important just to overfund the account, do the raise. If you don't have enough money and it doesn't work with additional capital raised to finish your project, you don't have a deal yet.

Yeah.

Just don't do that deal. There's other deals that do work where you can raise the money and make a ton of money on.

Yeah. And also if you find some major issue that happens, be upfront with your, your partners and your investors. Don't just hide it because then they'll find out later and they'll it'll not be a fun conversation. It won't be a fun conversation in the beginning, but also it's a, hey guys, I just found this out. How do we tackle this? And that's when everybody can go, this sucks, but let's move on. And how do we get this fixed correctly?

Well, yeah, the conversation's never comfortable. No, you, you're totally right. But have you ever had a super negative reaction to an upfront conversation of like, hey, something unexpected happened, a pipe burst, unit flooded, you know, Here's our game plan to handle it. Have you ever had a conversation just go completely sideways when you brought it up front?

No, it's after you hide it or you try to fix it without giving a heads up. Like for me, I always tell my partners, hey, this problem arose. I'm getting solutions for you. Just heads up, it's, they're coming, but I want you to be, I want you to be aware of it. Cause also they might have some ideas too that actually are the solutions. So keeping your partners in that, your partners included is really helpful too.

They should have a really solid idea of what's going on. It's a great way to avoid getting sued.

Exactly.

Yeah. Many of our LLCs, we're the managing members, so there's a lot of responsibilities that you have when you are running the LLC. Everyone's an active member, but when we're the managing member, it's like, hey, everything needs to be accounted for correctly. Every invoice needs to be stored. Everything needs to be communicated. Uh, in our LLC is one thing that we've done to protect us. We put in a clause that says, hey, at a certain price, everyone needs to weigh in.

Yep.

So the managing member can't just come in and say like, hey guys, uh, surprise, there's a $20,000 bill. This is how we're gonna handle it. We would actually, for stuff that large, get together, call a meeting, make a decision. It covers us legally, but it also, people get less upset when they're a part of the solution. Yeah. Things will go sideways on a building if you've ever owned a home. Things break. Kids break things, adults break things, weather breaks things, water breaks things, fire burns things. There's things that will happen to your building over time. It is part of owning a building. How you handle those with partners is going to have a huge impact, huge impact on how much money you make. Now, without diving into, and we've had so many amazing partnerships and we have so many amazing partners, however, over 30-something LLCs. Sometimes partnerships don't go as planned without getting too specific where people would get upset with us. I'm thinking of the best way to word this without people getting too upset. Well, what are some of the lessons we've learned from partnerships that didn't go as planned? I'll tee you up with an easy one. We had a deal that may or may not have been in the greater Seattle area. Where a partner may have felt that because we were the managing member, every month of vacancy in a renovation project, we owed to them because they called vacancy waste. Now these were units that had fleas and bedbugs. We were, we were receiving—

we got bit by them.

Yes. Ask how we, we found out. 'Cause we actually came in with this project.

We're the fifth.

Yes. While we were being snacked on, they came in and decided after we very profitably, very profitably exited the LLC for everyone, they came after us for every month that a unit wasn't rented. Ridiculous stuff like that. How does that play out and how do you avoid scenario? Because sometimes you just get something ridiculous. It doesn't matter if you're right, by the way, if it goes legal, it, it's whoever wants to pay the most to be right is typically what happens. On deals like that or other deals where people have disagreed with the operating agreement, when we've had disputes, what does that feel like and how do we avoid that today?

Well, for me it doesn't feel great at all because either it's some ball was dropped or somebody didn't understand what you were trying to communicate to them in the past, and then you have to go back and re-explain it, and then they might have more questions. That cause bigger problems and just turns into this cascading issue. Mm-hmm. In that example, it was, the person was understanding what we were saying is like, hey, we're trying to get these units leased. It's the Greener Seattle area is kind of hard sometimes, especially on the type of the time of year. And that was our biggest problem as we were going into fall and winter and those are the hardest times to lease up. Mm-hmm.

Very true. So, so you'd say a lot of it comes down to communication.

Yeah. Always communicate.

Another thing that I've found is there, there, there's two types of operating agreement. There's member managed and there's manager managed. When we first started, we had equity splits where it made sense, where it's like, okay, there's enough people on these deals. It's usually, it was us, another partner, and then one or two capital partners. So every deal there's 3 or 4 people on it. We did member managed. One thing that went sideways for us that we'll never do again. So if you ever write an operating agreement and just keep this in mind. We had a project that was going well, and this is one, this ties back to the original point, by the way. This was one, the last building that we ever tried to renovate outta cash flow. This is where we learned the projects take too long when you do this.

Yes.

We're going through the project and we have done an excellent job documenting everything we've done on this. As like, as managing members, we dotted T's, crossed I's. We bought out one of the partners in that buyout. The other partner had more equity than us. We used to have balance. They bought more equity than we did. A few months later, we, we learned that they held a secret meeting, outvoted us, and decided, hey, we think we'll make more money if we run the LLC. They wouldn't respond to the PM. There was a whole bunch of problems where they, someone with no experience whatsoever in multifamily real estate had an operating agreement that had a clause in there that allowed them control over the LLC. Stuff like that. Just put together your operating agreements in a way, or if you have partnership buyouts, then one of the biggest things you can do, communicate super clearly to everyone, hold regular meetings, make sure everyone understands everything, and then have the paperwork to back it up where you still have some sort of operational control. Yeah. Whoever has the most experience should have control. If I have a partner who owns twice as many multifamily units as we do, it's not as big of a deal who's the managing member. If you're investing with someone who really is more of a capital partner, they're, you know, they're the money coming in. You are the operator. Make sure that you put in your operating agreements that no matter what happens, you stay in the driver's seat. Yeah, I think that was really, really important for me. That was one of the many partnership lessons I've learned over the years of it can all go back to what you agree on verbally, how often you communicate, and it can all be held together by what's put in writing.

Yeah. And also we have an LLC where it's equal. So one of our partners is pretty much a man— they're managing their half and we're managing ours. And it, it works great because we have that verbiage in the OA and we make sure— or not the OA, sorry, the, um, operating agreement, right?

Yeah, which is an OA.

Yep, thank you. Sorry. Uh, we have it in the OA and we make sure that we're very clear on our boundaries with each other. And so it works really well cuz it's also 50/50.

Yeah. But it all comes down to who is supposed to be piloting the deal, put together the correct things in the contract, and then clear, clear, clear communication. That first one where we, we came up to like how it was being managed in the vacancies while the situation was ridiculous. Like obviously your property manager doesn't owe you money for every vacant month that you have while you're under renovation. That's, that's obviously a ridiculous thing we dealt with. But there were times in that LLC where had we held a few more meetings, we communicated more clearly, hey, this is exactly how we're managing this and why we're managing this. As instead of just making them a bunch of money, which we did, if they understood what was happening to make them that money and they were more actively part of those decisions, I don't think that there would've been any situation where it would've got to where it got.

I also think too, doing meeting minutes, um, there are formats online for meeting minutes and so you, Fill it out, you send an email, you say, please reply if you agree to this so that it's documented so that if ever anybody comes back, you can go back and say, nope, on this date at this time, this was our meeting. This is what we discussed. You replied back that you agree by everything that's in this email. It's just documenting everything so you can protect yourself down the road as well.

Let's get into the juicy bits here. Getting organized in an LLC, especially as a husband-wife team. We made a decision a while back that we wanted to, we wanted to play the game. We wanted to have it all. And having it all for us means having the education company, the property management company, and the assets to back it.

Yep.

Have the experience, but really have control and business operations in all of these. It takes an insane amount of effort and time to put together the entire business, but we want the information, the application, the capital, the property management, the property acquisition. We decided from the front end we're going to build it. All in-house. What does that look like, especially as the wife of an entrepreneur? What does it look like to keep those pieces organized when you have everything happening all at once, all the time? There's, there's sales, marketing, accounting. How do you keep that organized? Well, where you're able to do the meeting minutes, the invoices for every LLC. What does that process look like if someone wants to build a business like we did?

How much time do we have?

Uh, we have— oh, it's my podcast, we have as long as we want. Uh, let's try to keep this to a, uh, a 5 to 10 minute segment.

It was a joke. Um, for me, it's, it's all about my files. What do my files look like? What do my paper files look like? What do my digital files look like? What do my files in my emails look like? Um, whenever I get an invoice that the PM does not pay, um, I have a file folder in my email where it has all the properties labeled, and then I drop it into that file. And so that I always have it organized along with my paper files. If we ever get anything in the mail from like the IRS or whatever, it always goes in that file. We keep it for 7 years. Um, same thing with your digital files. I know you're working on like EIN folders and stuff like that, like to make sure we know where everything is at all times. Meeting minutes as well, like those just go into the files, clearly are labeled, always the same format for everything so we know what to expect. And it's just, if you have that system in place, it just becomes really systematic and smooth and it just becomes second nature. And then you just start doing it and it just becomes really easy to run everything.

And this is one of the things, especially real estate investors, we tend to be ADHD entrepreneurs. So if you're listening to this podcast and you've already gotten, yeah, if you've gotten 18 minutes in, this is, there is a like 90% chance that this is you. It's really hard to stay organized, but what ends up happening is you, you end up with 30 LLCs, you end up with hundreds of rentals. You, you play the game.

Yeah.

Acquiring property is the easy part of real estate. And so you end up with a whole lot of pieces, a whole lot of property. In our case, a whole lot of partnerships. Just document everything. I actually have checklists in our, in our course, but like I follow, I try to follow this to the T where you have a folder, mm-hmm, your settlement statement, your insurance docs, your meeting minutes. Your P&L, your profit and loss, your rent roll, your EIN. Yeah. Operating agreement. Everything sits in one file as it gets done. This is the easiest time to do it. This is just like that analogy of like, hey, you can go clean every room in your house, you know, once a week, or you can just clean the whole house and get it clean. Yeah. Build the folder, have it done. When it gets to tax time, you take all your folders and you go, hey, CPA's like, hey, can I have this? Yeah, here you go. Here's master access to. Boom, everything that you need. Now you're just answering a few questions. You can file taxes on time or with minimal extensions for 30 LLCs. We run this in-house. Yeah. It's a crazy system we have. Uh, what software does one use to run all of these pieces? I use key pieces for the whole portfolio. Like, yeah, property management, uh, entity documentation, leasing. Like what, what did we do to build a system?

Yes. I use like Excel a lot of the times. I use monday.com. That's a great platform.

What is Monday?

So Monday is a, a service that I use where it has folders, but the folders I can adjust. So like if there's vacancies, I can have my vacancy status on each one of 'em. I can have my bids in there. I can have my pictures. I can have where they are at currently. I can have notes that are timestamped. It just keeps me super organized. And what's nice about Monday too is I can share it to other people and I can limit access. So if there's like Caleb Hommel, for instance, he needs access to certain files that I have. I can give him those files, but I don't think of all my files. So then he can go and see where he's— where we're at with our vacancies of the properties that we own together. But he doesn't have to see all the properties I own and all their vacancies and all their status. SaaSes.

And for team management to make sure that all the information lives in the cloud. Yeah. So you have lockbox codes, you can control who sees them.

Yes.

But you don't accidentally fire the employee who knows all the lockbox codes. That is, that is what systems like Monday are good for. It's inter-team communications and like backend scheduling.

Exactly.

By the way, not a paid advertisement. Do love the software. Me too. Uh, another piece that we use, AppFolio. We've tried a whole bunch, Buildium. We've, we've used, uh, a, a thing called Cozy that was later bought by apartments.com, so it's now their network. Appfolio has been the most powerful tool that we use. Yeah. For property management. It does everything. Everything. Uh, leases, screening, marketing, uh, bank account management, distributions, P&Ls.

Yeah.

Corporate accounting for property management. Uh, what did it look like on your end? So I, I'm in, you know, buying the software, getting the, the interviews, setting up the base stuff. I do the distributions. I make sure the money that goes in and out is correct.

Yeah.

Everything else just happens between you and our, our team, you, Corey, the, when we're building this, what does that software allow us to do that we otherwise couldn't do?

So that software is great cuz it lets me communicate with the tenants. It lets me manage our bills or invoices, which is a huge part of it too. So for our invoices, we attach all the invoices, we— it's timestamps when we paid all the things. It's great. It organizes it so well too, because then if you ever need to go back, you can just search for it and it just pops up, and then all the notes around it pop up as well. Um, if we ever have a unit turn, that's where I send it— the contractors, the unit turn. I don't send them Monday. That's for owners. I send the turns to the contractors through AppFolio, and I put my own notes in there, and then they reply back regarding the turns as well. So those are some of the things I use in, um, AppFolio. I know like we use leasing and something like that. I'm not more— I'm not in the leasing as much, but I do know that we do a lot of our leasing funnels through AppFolio, and we are able to background check all of our tenants. We move them in and And they just, our tenants have said that they love that platform because they're, it's easy to communicate with us and they also understand their portal and they understand like if they have questions or anything, they can ask us questions and they can also pull reports too as well.

And so essentially a Folio runs the properties. It's the, all the, the actual, yeah, it's the glue. Yeah. It's the accounting and the leasing and the property management.

Yeah.

The back office for our company is, is Monday where everything is stored and information is shared among people. Things like Excel, Google Drive, or Dropbox are all interchangeable pieces. Choose one. Don't put 'em all over the place to store your actual sensitive files for LLCs and tax docs. Those are to be stored physically and virtually. Yep. Yep. And that allows us to run the company where we actually can go out and buy a ton of real estate. If you get disorganized on that stuff, your time's gone. And I would not have time if I didn't have a wife like Danny. There's something about being a husband and wife team. I, I've said this on a podcast before, but I'm gonna say it again. Neither spouse should dictate the roles of the other spouse. Don't try to create a job. And when I first tried to get her out of teaching, a big thing I was trying to do is like, oh, how, how can I help create roles that I think she'll thrive in? What we ended up doing is Dani just offered to help on certain things and her, she developed her own role and turns out she's amazing at the one of the things that she does. She keeps us organized, keeps us on time. If a vendor's asking me, hey, where do I send this bill? I'm like, well, there's a 50% chance we're going to be speaking that day. I could be doing a webinar, running a class. I could be on-site at a project. Dani has found, hey, I'm really good at making sure our bills actually get paid on time.

People like to be paid.

Well, I'm focused on bringing in top-line revenue, which is, it's like, drive, drive, drive, drive, drive. You don't have any bottom line if your expenses run away from you.

Yeah.

Dani makes sure, hey, we have these, your company's account. There's gonna be a partnership structure, this could be a marriage, uh, structure, but letting your spouse dictate how they want to be involved in the business has made our business just amazingly better.

I did tell you at the beginning I only wanted to work 3 hours a day, which is not the case nowadays.

Well, now, now we have a full-time baby.

Yes, he is cute.

He is adorable and he is fantastic. And I am very grateful that we are both stay-at-home parents, uh, because we run a heck of a lot of business and being able to pass the football, uh, the football being the baby. We don't actually pass it, but being able to toss the baby, uh, from parent to parent through the day has, uh, has made the time with the kid just absolutely amazing. It's been an amazing business.

Yeah.

Are, are there any tips that you would give people who are working? Is one of the things, like, I remember talking to my dad about this. He's like, I, I can't imagine working with my spouse. My parents love each each other, been married for a long, long time. But is there any advice that you would give married couples who are in business together on how to stay sane? Because it is not always easy.

Hmm. That was a tricky one.

What does it, what does it look like for us on a day-to-day? Like, just kind of lay it, lay out like, what does it look like when I'm trying to run 3 or 4 companies? And there's a ton of stuff coming in all the time and the house still needs to run and all the other things that happen. How does that look?

I mean, it's kind of the equivalent of teaching. You have so many, you have all these balls being thrown up in the air at all times. You're constantly making sure they don't hit the floor. I mean, you just get the stuff done as fast as you can. And then if I need to tag Christian in, like Christian is very good at certain things and I need his help on certain things because I don't think the way that Christian thinks, which is great cuz then I think in different ways and I can, you know, solve those problems. But so I'll tag him in, but it's really just like seeing what's going on. Like, you know, understanding like Christian's busy right now, he, I can't bug him or Xander needs this and I need to go do this, or I need to go get back to this vendor at this time. Like it's just knowing what ball I need to focus on in that moment. And then once I focus on it, launching it straight back up in the air again and running towards the next one. Just keep. Juggling 'em until they're completed.

And on my end, having someone who else, who is just constantly thinking about the business and who lives with me is just absolutely fantastic. It helps keep me on track. It, it's, it, it allows the businesses to be what they are. We made the decision to have it all. That's, that's really the cost of doing that is there is a lot of time and there's a lot of organization. You have to be able to optimize if you want to scale. And I, I would argue if you want any level of financial freedom, you do in fact have to scale.

And we are very fortunate, Christian, that we work very well together.

Yes.

There are some couples who don't, and my advice to those couples is if it's not working, find a different way because you don't wanna be bickering with your spouse all day long. You, I like, I love seeing Christian all day long. Some couples don't want to, and that's okay. Like if you're like, I need my space, I need my job to be separate from my husband's. That's fine, but you need to know that.

Also be more interesting to be around.

No, just be aware of who you are as people.

No, personality types matter a lot, and choosing your partner correctly is, is a huge thing. But sometimes you're in a situation like us. There is no reason to believe we would have been good in business together because she was a school teacher, I was a, a salesperson, worked for CoStar.

Yeah.

When I decided to become an entrepreneur, that was never part of our marriage before. So we, and you had no inherent training or experience in the field that we were in.

I also had no training with working with other adults cuz I was working with kids all day.

Turns out pretty similar. They're kind of like big children that are all grown up.

But I never was in like the corporate world, so it was very different jumping into that more or less. But you know, you, you pivot and learn. That's another thing too, is you have to learn how to pivot. If you can't pivot, you're, you're gonna be dead in the water.

Yes. Which is a good final point for this podcast. When is it time to pivot? I know there's been many projects where we've held on too long to a vendor, too long to a partner. Uh, we've, we've thrown too much money at a project where we've, we went like, hey, is it still the project? Is it still a project worth doing? Not every company that I've launched has been successful, by the way.

Yeah. If, if, and that's okay.

Yeah. You know, it's like, well, you should be making all this money from all these companies. It's like, yes, I was an overnight success after like 8 years of grinding at this stuff. Yeah. And I'm really fortunate that it happened that fast. When we're building this, how do you know when it is time to cut off a project or what things are worth the time to continue to nurture?

I am, I'm weird and I, I look for signs. Like I am very much If the door is easy to open, go through it. If it's hard to open, it's probably not the door to open. And that's just like what I do going through our companies and businesses. If it's, if it's just not working, it's just not meshing or clicking, it's like, okay, we need to rethink this because it should be fun. Yes, it'll be stressful, but it should be fun. And if it's just stressful and it's just a grind and it's, you're losing your motivation, stuff like that, that's where it's like, okay, stop. We need to reflect, do we need a pivot or not? And that's okay. And if it's not working, it's not working.

Well, and this is actually something I love, the bottleneck analogy. And people use the term bottleneck all the time, but literally think about it. Like, you have a bottle, it's this wide, and it goes to a little choke point. There's only so much flow that can go through that little point. What I have found, since Danny is very flow-oriented, where it's like, hey, what, What, where does the current seem to want to go? And let's continue to go towards the things that are working. When there is a point where we do hit a bottleneck, we hit a place where it's like, hey, there's friction here. What's really fun as a husband-wife team, and if you have a business partner, hopefully you have someone who's like this, Danny can quickly identify, hey, we're stuck here. When that is passed to me, I then get to determine, is this a bottleneck where we can widen? Is this something where we can do, are there actions that we can either do today or influence today? That can alleviate this so that the river can flow? Or is this something where we've tried 6 or 7 things and it doesn't seem like we're supposed to go there? Like it just, it's not working. And sometimes that is the case. I would've loved to own my property management company in Washington State and have it expanded to Texas. It would've been an amazing thing to be a multi-state, just larger PM company. What I found is I was trying to put the pieces together for that stuff, just perpetually kept not working. Our very few small little partners on that deal were causing problems. That wasn't the main issue, but like we had people who had just altogether stopped working on the company as we were getting ready to move. We were very pregnant when we moved to Texas.

I was, he wasn't.

I gained a pretty similar amount of weight, so you did. One could argue. Um, we, we, we shared the baby weight when we came through and put that together. That was one of the things where you're like, hey, I need this off me for me to go to Texas and be a mom, especially if we're going to run a property management company down there. If we are going to be doing that and we're going to be growing the Multifamily Strategy Community, by the way, shameless plug, we have a new school community. Check it out. It's called Multifamily Strategy. It's completely free. I want to see $100 million of transactions go through that. I volunteer to be the first 2 of those, but there's another 98 million that's going to go through that community. So join that. That is free. Link is probably below in this episode. If it's not, just go to Skool and type in Multifamily Strategy. But when we are building that, it allows me to focus on the things that do have the most flow, that has the most momentum. You have all these mentees all over the country who keep buying deals. And we're seeing that the deal flow is going up and up. Like the, it was already a great ratio and now more people are more likely to buy a deal faster when they join. Danny's good at analyzing like, hey, that is obviously working and that has a ton of growth. The coaching's getting even better.

It's your passion.

And I love it.

He, he loves what he does. Like he pours himself into his mentees and into that company.

There are so many projects like that that we're allowed to do because I have a spouse who goes, hey, these are the things that you don't need to do that aren't working. Yeah. And there's a lot of businesses that I think could have made a lot of money. I have a lot of ideas.

Yes. And I have a video of him promising me that he will not do anymore right now.

Yes, actually, actually that has expired. That was for 2024. We are in a new year. I am free to move about the cabin.

No, you're not.

Oh, well regardless, choosing the things you do, everything has to vertically integrate, but you don't need to do everything. And that whole Robinhood taught us that, that flow method. Yeah. Yes, it did. Yes, it did.

Yeah.

The Robinhood is a gr— honestly, it's a great deal with a great deal structure and it's an amazing property. It's a one-of-one property. That was the attraction there. Hospitality is what didn't make sense for us. Had we done this flow thing and said, hey, look at all this buying apartments, renovating, providing, like fighting homelessness. That's one of our main things that we were trying to do. Create excellent places affordably for people to live.

Yeah.

Be the opposite of a slumlord, but service the people who need that type of housing. We're so good at doing that. And that's what all of our systems are. All of our people are good at that. Hospitality, huge distraction. We took things like that and we learned like, hey, You don't have to be great at everything, but be excellent at the things that you're going to be excellent at. I would rather be excellent at 3 or 4 things than be okay at 1,000 things. And I don't need multiple income streams over multiple businesses. I need to be amazing at one thing and we can vertically integrate up the wazoo. But if you haven't heard of that, that, that whole flow mentality, that's the, I mean, that is such a great way to run business.

Yeah.

What door is opening? Go through that door. You'll just end up going through more doors. You have more opportunities. And if you have someone on your team who's a problem solver, like I, I'm somewhere between a visionary and an integrator. I fall kind of on the dead center on those. But when I get into the integration of stuff, that's where I can quickly assess, okay, we're not flowing here. Can we fix it or do we need to bypass it? Those are the only two options. It allows us to make a decision quickly. Closing thought, if you could do a business where you can make all of your major decisions the same day that they come up, you'll go way faster than most people who labor on the same problem for year after year after year.

Yeah.

I, when we have ideas, they go quick. I love getting the team together and say, hey guys, we have a great idea. This is what I think it looks like. What would it look like for us to have this rolled out by the end of the day today? And oftentimes the team is, you are insane. That can't happen. Other times we actually have done major, major operational feats where we've dropped everything and we have changed the direction of an entire company in 24 hours. It's a great skill to have. Danny is really good at identifying where we are stuck. I am good at making the decision on are we going to bypass it? Are we going to fix it? Or are we just going to skip it altogether? Yeah. Good team. Way to go, guys. That's an episode. If you haven't yet commented, liked, left a review on the podcast. I'm trying to grow this thing. We're interviewing owners today. We're kind of interviewing ourselves, but for owners, we want to interview the owners that you one day want to emulate. We've had so many great people on this podcast. I believe our next episode is going to be episode 50. So while we are still young, we are growing. So like, subscribe to the podcast. We appreciate you. Join that free school community and we'll see you all in the next episode.

Bye.