An Overlooked Opportunity for Small Real Estate Investors | Tiffany Mittal

You're listening to Breakaway Wealth, the show designed to help you build wealth faster, think bigger, and break out of the herd. Now, here's your host, Jim Oliver. Welcome back, Breakaway Wealth. I'm your host, Jim Oliver, and with me today, I have Tiffany Mittal.

Mittal.

Mittal. Did I say it right? I knew I was gonna say it right, and then it sounded like middle. But, I was trying to say Mittal.

Yes, you did.

Yes. Okay. I like the Indian version because I like to make sure that if there's a version, whether it's— I have a couple of friends from Brazil. And, to say beautiful in Portuguese, you say linda. Now, it sounds like Linda to me because I'm a dumb American. So, I always have to say linda. You know, like, but anyway, all right, Tiffany, now that I've just really butchered our beginning here, save me and tell the audience a little bit about yourself.

Absolutely. Thank you for having me on the show.

You're welcome.

Tiffany Mittal, and I'm a multifamily owner-operator. I'm also a founder and CEO of Utility Ranger, which is a prop tech company targeted at multifamily. And I live in Florida, married, have 4 beautiful children, and living life the best way I can.

You know, I always like this time of year, Tiffany, because don't tell anybody, because we're recording right when something magical happens down here and all the snowbirds go home and the people that live here full-time. And we tell them, oh, it gets so hot down here. You do not want to be down here. You got, I mean, May, You're gonna melt in May and don't even talk about August. You know, so I always love that because I had that conversation with somebody on the golf course, man, how did he stand it down here in the summer? I go, oh, it's horrible. You should just make sure you're gone by May 1st.

I'm learning. I'm learning quickly.

Yeah, that aside. So tell me PropTech. I mean, for everybody in the audience that, okay, they hopefully know what multifamily is, but tell them about PropTech.

So PropTech is just a fancy word for property technology, just like, you know, Venmo is a financial technology company called fintech. It's just a quick shortened version of property technology. So it's like Zillow is a prop tech company. Appfolio, for property management software people, is a prop tech company. So we have a prop tech company, which is property technology that services landlords who own apartment buildings.

Perfect. So All right, you are a multifamily owner-operator. And I was gonna ask you these questions because I already know the answer. But where are you from originally?

Well, we are from San Diego originally. I'm second-generation San Diego native. Yeah, never thought I would leave. All of our properties are in San Diego except for one. We just bought one down in Pompano Beach. Nice. But we recently relocated our whole family to Florida. And we are committed to divesting our entire portfolio out of California this year, and moving that to Florida as well. And luckily, you know, San Diego, they just got hit with all these crazy, you know, declaration of emergencies, and they have extended their 1031 exchange rules, which actually happened last year as well. And so we were able to take advantage of that. Rather than being confined to these, you know, 45-day, 90-day identification periods for exchanging your properties. So, we can hopefully combine some of them into a large number and get a bigger property out here in Florida.

No, that's awesome. And again, for people that are new to real estate in the audience, a 1031 exchange is a like-kind exchange, and you have to be careful the way that you do it, and you have to follow rules. And if not, you trigger tax consequences. And I'm going to guess one of the reasons that you moved out of California to Florida is tax reasons.

I mean, that is definitely high on the list. Yeah, I would say much higher on the list were reasons that had to do with our business. You know, as a landlord, it becomes very, very difficult become a landlord in California.

Yeah.

The regulations that are put on you. I mean, now there's new regulations coming out that require you to pay tenants to leave. I mean, it's becoming so absurd that we want to get out before it's too late. And we thought we'd want to retire in Florida one day. So we said, why are we waiting for retirement to be happy? I want to be happy now. And, I think COVID did that for a lot of people, put really your life and your experiences and your joy kind of ahead of all else.

Well, I really wanted to be the committee for Florida. I wasn't going to charge that much per person moving in, just a 15-minute interview, 3 questions, and then I would know whether we accept you as a resident or not. And, I already know that you guys would have gotten in no problem. Okay. I always say to my country club, hey, you want to run for the board? No, I'll be czar though. If you want me to be the czar of the country club, I will be. And if— just let me make all the decisions and I'm in. But I don't want to be on your committees and your boards and waste my time, right? We're not getting anything done.

All right.

So how did you start off your professional career? Tell me about that.

Well, I think a lot of people get into real estate by accident. You know, I was always entrepreneurial. So, you know, my parents couldn't really afford to send me to college when I was younger, and I didn't want to go get just kind of a dumb job. I wanted to try to do it my own way. So I actually became a hairstylist when I was really young, became really good at it, did that for about 10 years and owned a salon with about 20 employees. I sold that salon in 2008, right after my husband and I got married, because I wanted to go back to grad school. And towards the end of 2008, you could tell something was weird. And my husband said, you know, right now might be a good time to sell. I said, you know what, it probably is a good time to sell. So we, you know, back in the day, put it on Craigslist and had 3 cash buyers within a week.

Wow.

So we said, okay, let's take the best terms and the highest number and went through escrow. And 4 days before it closed, they announced the first bailouts. And we said, oh my God, how lucky are we that we got out of this When we did. So I went back to grad school and started helping my husband with his apartments.

That's awesome. You know what I love about— I love Los Angeles and San Diego, and I know LA better than I do San Diego. But what I really love about— there's a guy actually in San Diego, Brian Buffini. He's a real estate agent coach, right? He does real estate agent coaching. And there's quite a few people that listen to the show that are in real estate from that side of it too, and they get coached by Brian Buffini. And they're— a lot of them are part of this White Hat organization, which is the top like 1% or something. And he wrote a book called The Immigrant Advantage. And I don't mean like— it's like I kind of feel like if your parents or you immigrated here, you have an advantage because You see that, you kind of see the truth. So, when I was a kid, maybe when you were a kid, you're a lot younger than me, is it was go to school, work hard, get a job, work there 20, 30, 40 years, retire, hope that you don't run out of money. And, that's what it'll say on your grave. They didn't run out of money or some— that's your accomplishment.

Both my parents have that exact same story. They both worked for the same company for 30-plus years. And that wasn't really a way to succeed, especially in today's economy.

Yeah.

And so finding your niche, I fell into real estate by accident, helping my husband and then realizing I didn't actually like the operations of multifamily, you know, dealing with tenants, bedbugs, and that kind of maintenance issues is not how I saw myself. After I got out of grad school, I saw myself doing other things, but I wanted to work with my husband because we have such a great relationship and we really enjoy being around each other. So I really just kind of dug into our multifamily, found a problem with our utilities and said, how do I fix this? Went to go work for people who do this and then kind of turned their service model into a SaaS model.

That's awesome. You know what? I've had the pleasure of having dinner with you and your husband a couple of times, I think at the same restaurant, by the way. But nothing wrong with Fleming's. And I love how you guys have a great relationship. And if you have a podcast where you interview people and try to teach them that, let me know because I'll have to watch. But I love that, you know, people find their successes by accident a lot, right? And I think that the thing that prevents people from doing that is fear. So, you go to grad school, that's a big investment of time, money, So, what kind of mind shift was that to say, okay, I'm not going to use that in the traditional sense of going and becoming a consultant or whatever that you thought maybe you were going to do. I'm going to go help my husband grow his business, our business, and then figure out how to expand it and make it bigger. Because it's kind of one of those things when you collaborate with somebody, Right? If you and I were collaborating, you would have an idea and I would go, oh, that's such a cool idea. I never thought about that. And then I would, my creative juices would start to flow. I would make it a little bit better. I would give it back to you. You'd give it back to me, back, back. And all of a sudden our collaboration just goes like this, right? But now when that's your husband that you're having that collaboration with, that's got to be amazing because you're in the same boat. You're rowing the same oar. You know, it's like— That's really cool. So talk about that a little bit.

So I wouldn't say it happened so seamlessly. I would say it was more, I didn't necessarily think to myself, I'm going to work in the same industry as my husband. I got out of grad school, I was helping him with his apartments in grad school, and realized I didn't really want to do what he did, but he really needed additional help. And so as I was kind of in misery, I wouldn't say it was a misery, but definitely not enjoying that role that I was in. I had recently also had a baby.

Wow.

And so I'm in this kind of postpartum phase and not— I remember telling my husband right after, it was like 4 days after, and I said, you know, I'm on maternity leave. And he said, we own our own business. There is no maternity leave. I'm sure you can get rents entered standing up. And I was like, oh my God, this Is not going to work for me.

Not this California girl, right? Certain things about California that stick. No, I'm just kidding.

So, you know, I knew that we were having a problem with our utilities because our water rates were going through the roof. I remember sitting down and doing the bills one night and looking at my husband saying, our water is so expensive. It's like really starting to eat into our profits. And so it was in that moment that it was actually my husband's father who had said, why don't you guys do this Rubs program? I've been hearing about this. And my husband's father has about 3,000 units in Los Angeles. And so he said, why don't you try doing this? I've heard about it. I've had a bunch of people come and pitch this to me. So we set up a meeting, we had this company pitch to us, you know, what we were going to do. And we said, well, we're just going to do it in our San Diego portfolio rather than implementing it through his parents' portfolio as well. Yeah. And they said, well, Well, we can't do that because the portfolio is too small and we have 1,000-unit minimums. And we said, so you're not going to help us? And they said, no, we can't. And so I kind of don't like hearing no, I don't, and don't like someone telling me that I can't do something. At the same time, I remember looking on LinkedIn and seeing a job posting for a similar type company that did utility billing that was located in San Diego. So I was like, well, I'll reach out to them and maybe they can help us. Well, they also told us no. But then I said, well, why don't I get a job there? Well, I think intuitively the owner of that company was like, oh yeah, I'll probably get her units and her family's units.

Yeah, yeah, yeah.

But as a business, but it was a small company. I think I was employee number 4. We were doing about $100,000 in revenue. But lo and behold, through that experience, in 5 years we were at $20 million in revenue. We had 70 employees. It was a rocket ship. So I kind of got into a company by accident because I couldn't find someone who would help us. And my husband was like, well, go get a job for one of these companies and maybe you can figure out what they're doing and bring it back and we'll just backdoor the service. I said, that's a great idea. It's that collaboration of him putting that idea in my head and then me finding this company in San Diego that would do that. So I got a job there, grew that company, and that's when we discovered this kind of forced appreciation method. Which is what utility billing really is, or the secret behind utility billing. It's not about billing your tenants for utilities. It's really about creating forced appreciation at your property by kind of NOI hacking or increasing your net operating income by billing back your third largest expense. So once we figured that out, we increased our property value by $1 million for $36,000 of additional revenue. And I was like, oh my God, this is crazy. I mean, what would this look like across our portfolio? What would this look like across your family's portfolio? My sister at the time owned a dozen units. And she said, wow, I see what you're doing. Like, let's— let me do it. Like, take me on as a client. And I had to say, I'm sorry, your portfolio's too small. I can't. So I created this like Excel calculator and gave it to her with a mail merge for her to bill her tenants, which she did. And I said, If I can do this for her, how can I just take this service model, turn it into a SaaS model and service all the small guys like myself that no one will service them because they're too small. So I kind of fell into it because we saw a problem. We kind of backdoored, tried to solve the problem. We saw an increase in our portfolio wealth and then said, okay, how can we now do the same thing for smaller owners like us?

You know what's funny is as you've been talking about this, I had somebody come on and they do something similar, not exactly this, for HOAs, right? And, they do the same kind of thing. We have a small HOA in my little section of the neighborhood, but there's only 25 homes. So, nobody wants that. It's just not worth it. So, we're kind of self-managed HOA. Thank the 3 gentlemen that are on the board. You do a great job. I'm just kidding. They won't listen. But, you know, they get to pick out the color of the flowers and all that kind of fun stuff. And, you know, God bless them. So, just walk me through, like, who's your target? Somebody's in the audience, they're either getting into real estate or they're doing real estate now. And, I always say I don't like the term real estate investor. I stole this from somebody, but I'd say like, if you're a real estate investor, you're in the real estate business, right? You got to run it like a business, which is part of what you're showing people how to do is you got to run it like a business. So talk about that and then talk about the depreciation after that.

Well, I would say running it like a business means how do you increase profits, right? How do you increase your value as a business? How do you increase your value as a business is increasing your value from properties. So when you look at different ways to run businesses, if you're going to call it a real estate business, which it is, you have to look at your income versus your expenses. And so we really target the owners, operators, property management companies who are small and under 1,000 units. So most of those people today, most of the large institutional investors, they have solutions out there. There are service companies who will help them all day long. But it's really the smaller investor, smaller owner who doesn't have a lot of options, which that actually makes up almost half of the United States multifamily supply are completely underserved. So, but this is like the mom-and-pop businesses, right? These are the mom-and-pop owners.

Yeah.

Like these are the heartbeat of America. Like, why can't anyone else help them? You know? So we said, how can we help The small investors have the same advantages the big investors have had for years. And so this kind of NOI hacking that you can do, where NOI hacking is either increasing your income or reducing your expenses, either through capital improvements, which most people do as a value-add strategy, but we're saying basically lower your expenses because you are collecting your third largest expense, which increases your overall income, increases your overall profits. which will grow the value of your portfolio value as well. So that's kind of who we're targeting. And depreciation, I mean, that's, that's a heavy subject in and of itself.

Yeah, it is.

I know, this like accelerated depreciation, you know, which is a way of having more tax write-offs and whatnot through real estate. But there's a lot of advantages using depreciation, but I don't think that I'm the expert to talk about that.

Well, and I meant just kind of how you guys show people. So If somebody wants to work with you, you have a website. I mean, I'm sure you're on all the social media platforms and all of that. Tell me what's the best way for somebody to get ahold of you.

They can find me on social media platforms under Utility Ranger, and then they can also find me at utilityranger.com.

Perfect. Perfect. You know, there's a lot to unfold with what you just said. And when you try to get into business, I had a client on and we were talking about infinite banking a little while ago, a couple hours ago. And, he said, well, I wanted to get into business, so I started studying the business terms and I started studying accounting and I started studying all of this. And, the one thing that when he was talking, in my brain, I said, no, no, no, who, not how.

Mm-hmm.

Right? I want to find partners that already know how to do the stuff that I don't know how to do so that I don't do it. I don't want to recreate it. I don't want to learn how to do it. I want to focus on what I do and let them help me and be part of my team. So, I love that you guys are providing this service and it's not like, hey, we're coaching people how to do it. Hey, we're doing— you hire us, we do it. Not that there's anything wrong with coaching, okay? Coaching is great. But also, I say when you're looking for coaching, it's who. Like, will somebody partner with you on a deal? I mean, and walk you through it and truly. But also, what I love that you're doing is the whole concept of infinite banking is taking banks from this big global thing down to the you and me level. And, it's all about freedom and abundance. Money gives you choices, choices give you freedom. Whoever controls the money makes the money. Using other people's money, having use and control of that.

Yeah.

And that's what banks want, right?

And so that third-party piece out of it, which is so similar to what we're doing, is kind of helping the poor guy. Yeah, the big guys have been doing this for years on the infinite banking, right? Like, how do you eliminate these third-party providers? And you had mentioned something earlier, like it's something that we're doing. So we're actually just a software platform. We're changing an industry that has traditionally had a service-based into a software-based platform that people are doing this themselves. Same with like infinite banking. This has been banking as a service, right? And so now you're kind of taking your own banking in-house. And when you actually take things in-house, you know, in the institutional world, they call this, you know, vertical integration.

Yeah, right. Exactly. Exactly.

Which basically means I'm kicking out all these service providers And bringing everything in-house and doing it in a way that's simple enough for me to do and getting all the advantages the institutional players have gotten for years.

So you know what, you're exactly right. And to give you an example of that, at a mastermind that Tiffany and I are both part of, Nick Kosko and I are part of it, Tiffany, her husband, are part of it. We just had a meeting last month or so, and somebody reminded me of the book 38 Letters that J.D. Rockefeller wrote to his son, John, right? I can't remember the exact name of the book, but it's 38 letters. I mean, literally, the whole book is just these 38 letters. But in one of the letters, one of the first ones, and I don't remember what number, but he says, I did this, this, this. He says, now I am the bank.

Mm-hmm.

And he says it with like the way that it's written, it's like, Because I figured it out. I'm the bank, right? Well, that's what infinite banking is all about. And, you know, everybody wants to be like Rockefeller, right? So, by the way, that's a great book. And that leads me to the last 2 questions that I have for you, Tiffany. And we're going to put all of Tiffany's contacts, social media platforms, everything in the show notes so everybody can look her up and educate yourself and see if this is a good fit.

Yeah.

And maybe it's a good fit when you're ready or you know somebody else that if you're over 1,000 doors or if it's not a good fit. But Tiffany, I'm sure could help you and you might be able to help her with some people that you know that are under that. All right, Tiffany. So, along the way, it seems like you got some maybe great advice from your in-laws, also your parents, right? Even if they were told the wrong things, everything that we were told about money is a lie. But, sometimes we learn from doing things the traditional way and seeing that, hey, that doesn't work. I don't get the results I want. Along the way, somebody had to give you some great advice. What's the best advice somebody ever gave you?

Well, I would say I grew up in that generation like, do what you love and the money will come.

Yeah.

But, that really is telling you to make it to where your job doesn't feel like work because you're so passionate about it. I would say, first and foremost, that still rings true today. It's just hard to find exactly what that passion is. I never thought utilities would be my passion.

Right.

I enjoy creating value for me and my family, and I enjoy creating value for other people. And so I don't think of it as work really any day because I love what I do. But even bigger than that, I think, is follow the calling that you had. I had this idea to come up with this SaaS version or a software version of a service model back in 2015, but it was this internal calling that wouldn't go away nagging at me for years and actually trusting that intuition to actually push forward and create a company.

I second that 100%. I questioned for so long, people don't want to hear from some kid that grew up in Inglewood, California poor as dirt, that how to build wealth, they don't want to hear that. They want to hear from somebody where they've had generations of wealth. And, it was just this nagging thing and it's like, okay, fine, turn the camera on, I'll start talking. And so, I totally get that. Alright, last question, Tiffany. If God came down from heaven and only allowed you to retain the knowledge that you've received from one book that you've read, what would that book be?

One of my favorite books is Start with Why by Simon Sinek.

Love it.

It really helps you understand why you're doing something. Again, going back to, did I ever think that utilities was my why? It's not really about utilities. It's really about helping the little guy, giving them the same advantage that big guys have had for years. You know, I come from that. I come from the little guy family. You know, my parents didn't have money growing up and I was able to kind of use my passion to get where I'm at today. And I can use Any of that to help anybody else and lift up other people and show them that you can do it too and help make a level playing field, that makes me really push forward.

I love that. You know what? It's funny. Okay. So, I'll go back to Rockefeller for a second is a lot of people don't know that Rockefeller was super poor when he was a kid, but he had a vision and he said when he was a kid, he was going to be the richest man in the world. which he was. Okay. So, I think that's really cool because it's hard to have a vision. And, when I talk to people and people that really aren't in this entrepreneurial space, it goes in like it just like they glass over. Like, what's your vision for your life? What do you mean? No, no, no. I mean, today, I wanted to have chicken for dinner. No, what's their vision? What's your dream? The reason I look over here is I have this whole wall is that paint that you can draw on.

Yeah.

And wipe it off. And, it's everything that I want to be, everything that I want to do, and everything I want to have. And so, that's my vision. Well, why do I want that? If I don't have a why, guess what? That's not going to happen. I mean, I want to be 210 pounds. Why? Because I think if I'm 210 pounds, I'll be around 14% body fat. And, for an old guy like me, that's pretty good. And I'll be strong. So, that's my why. I want to hit a golf ball further when I'm 70 than I can at 58. But guess what? That's why it'll happen, right?

I love it.

So, Tiffany, thank you so much for sharing with us. And I love just the energy, like you said earlier, and it was something that I definitely noticed is the energy that you and your husband have together and the synergy Just having dinner with y'all and seeing— uh, see, did you notice that? Kid from California. Now when we're in Florida, Tiffany, we can say y'all, but it just doesn't come out as naturally for me.

It doesn't come out so naturally for me. I'll try.

Yeah, I know. I have a friend, uh, oh, I have lots of friends from Birmingham, but I have one in particular. He just knows how to say y'all, you know, like, and see, that didn't come out right. But anyway, all right, Tiffany, well, thank you so much. Thank you for all the service that you're helping people and bringing real estate down to the you and me level, just like Infinite Banking brings banking down to the UME level. And we're going to wrap this up like we always do with the great, amazing words of Earl Nightingale. Take it away, Earl. Here's the key to success and the key to failure. We become what we think about. Now let me say that again. We become what we think about. Once again, Thank you so much for taking the time to hear what was shared on today's podcast. If you are looking to discover new wealth-building strategies, then go to community.createtailwind.com. That's community.createtailwind.com to join our free online community and get access to free courses and in-depth training videos designed to help you build wealth and break away from the herd. Click the link in the show notes to access the community today. Thanks again for listening.