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The Myndful Investor

Landlord / Rental Properties

A Comprehensive Look at Real Estate Investing With J. Martin

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Full transcript here:

Steve Rozenberg: Welcome to another exciting episode of The Mindful Investor podcast. Today we’ve got a good friend of mine and you’re going to love this story. That’s all I’m going to say. I’m going to save it so you can hear the story. First, Alex. Man as always, I feel like I just talked to you yesterday, Maybe I did. But thanks for joining me, my man.

Alex Osenenko: Well this is the podcast episode and those of you who are listening, it’s a real seat at the table with real meaningful conversation about a topic we’re all passionate about, which is real estate investing. But it’s also the human beings that actually went in it and we all get… I feel so privileged to be at the table. And guys, both of you, are obviously experts and you both have your own expertise and fields and this is going to be an amazing show. I am just here to learn and ask questions like a five-year-old. So mindful of that. If the question sounds too simple is because I’m pretty simple, but also it helps our audience kind of connect the dots, I hope.

Steve Rozenberg: Absolutely.

Alex Osenenko: I think that’s the dynamic people are looking in this show.

Steve Rozenberg: Absolutely. And so for those of you watching the show, this does come out every week on iTunes. So if you go to iTunes, The Mindful Investor podcast show. We also have a Facebook group, The mastermynd m.y.n.d, Mastermynd Real Estate Investment Club. There we have investors like me, Jay, all these other people that just talk about what’s going on in the industry and real life situations. So without further ado, I have my good friend J.Martin on the show today. Jay, thanks for joining me today, man.

J. Martin: Thank you for having me. Appreciate it Steve.

Steve Rozenberg: So this will come out later but where in the world are you today? It’s the first question I have.

J. Martin: Believe it or not, I am in the US. I’m actually… It’s funny I think I’m in Sunnyvale actually once we meet up last night and stayed at another investor’s house. So I think I’m in Sunnyvale. They left for work or it can be Santa Clarita, I’m in the Bay.

Alex Osenenko: Oh you’re in the Bay. I’m in Castro Valley, which is East Bay. I can’t afford a real Bay.

Steve Rozenberg: Now, as you’ll hear Jay’s story, you’ll understand why I’m asking that question because this guy prides himself on not having a home and real estate has given him that opportunity to have this ability in life, which is amazing. And Alex, you’re going to get some good takeaways and there’s going to be one major takeaway. I’ll just give you a quick synopsis of how Jay and I met. We met at a networking event. It was a Mastermynd in Maui that Terrell Yarbrough and Brandon Turner from BiggerPockets put on. And we were both there and we got to know each other and got to kind of learn about what he and how he does it and had a real… it was about a week long. I was just a think tank and it was great mixing with Jay and the other people. And I got a lot of respect for him, understanding what he’s gone through in life and more importantly, what he’s done since he had a pivotal turning point and kind of where he’s going in the mental side of it. Because again, anybody could buy real estate and be successful, but to do what this guy has done mentally and make that change is huge. So Jay, thanks so much for being here today, brother.

J. Martin: Thanks. Appreciated Steve.

Alex Osenenko: So lead us in Jay, tell us a little bit of a story. What are you about? Like the high-level and my pen is hovering over the paper so I can’t wait to get in the meet. But we’ve got to meet you first, tell me about Jay.

J. Martin: Yeah, absolutely. For everyone, I think there’s something that leads them into wanting to invest, whether that be real estate or something, right? There’s some motivation behind it, whether it be family, friends, volunteering, travel. There’s something that people want in their life that they’re trying to achieve through this financial needs. So for me, a really pivotal turning point of my life when I was 19 years old, I went to jail for selling cocaine. So I got arrested, I served 80 days on a 120 day sentence in jail.

J. Martin: So almost three months. And to be honest, I got in a fight in jail. It was a really tough situation for me. Ended up in solitary confinement and I’m laying in this tiny cell looking up at the brick walls going like, ” What the fuck? Oh, excuse me, what am I doing?” And looking with my life and I realized, first of all, I need to get my things together. And number two, I was like, ” I know there’s some legal way to make money. There’s a lot of people making good money in the United States outside of illegal things in the drug world.” And so as I was laying there in solitary confinement, I was like, ” You know what, I am going to get out and I’m going to find some way to legally make money and kind of bring my life together.” So for me that was kind of my motivation. I don’t encourage everyone to go to jail to get motivation to invest in real estate.

Alex Osenenko: Well, you do get some time to think between the fights, right?

J. Martin: Tons of time to think and read. But at least for me, that was a huge turning point in my life. And again, the motivation that got me willing to make some sacrifices to further my life in real estate. So I think whatever… I just encourage people to think of that motivation in their life, whatever it may be when they’re going through this process. That’s what it’s all about.

Alex Osenenko: This is what I’m incredibly curious about, Jay. What is the first step? Okay, you get out, the door opens.

Steve Rozenberg: You get out of jail is the first thing I would say.

Alex Osenenko: You get out, [crosstalk] 10 days, 5 days, 2 hours. How do you turn this?

J. Martin: What are you doing next? I’m going to Disneyland.

Alex Osenenko: Yeah.

J. Martin: No. I didn’t go to Disneyland. So basically, I’m getting out, I had a little bit of a tough time finding a place. I was fortunate to have some people in my family were really supportive and I was able to kind of bounce around, stay in different places. One of the huge challenges actually getting out of jail and I think hopefully this helps with anyone who’s had a problem or had to overcome something, is that it seems insurmountable at the time. When I got out of jail, so my thought process basically at the time is shit.

J. Martin: I’m not going to be able to find a place to live, I’m not going to be able to find a job let alone even thinking about investing in real estate at the time. I didn’t know anything about it. It was furthest from my mind. But I didn’t think I was going to be able to get a place and a job. With help from family and friends and this and that, I was able to find places to stay. I started working basically really menial jobs and went back to Community College at the time. Eventually, went back and went to San Francisco State. So I eventually transferred and eventually graduated from San Francisco State.

Alex Osenenko: From San Francisco State? Yeah, me too brother.

J. Martin: Oh, you’re a Gator too.

Alex Osenenko: I’m a Gator. Hey man, that’s great. Wow. I never expected to hear that.

J. Martin: Yeah, I mean that was the kind of process, right? It was really tough getting out and then getting back into school, getting motivated to go do something. And when I graduated, basically ended up in bank regulation for the State of California. So we were going bank to bank during the financial crisis and reviewing their real estate loans. So we saw people get wiped out, lose everything, millions and millions of dollars. And then we got to see the people who were picking up the pieces. And that was my first introduction to real estate. So it was a few years later but that’s kind of how I got my first-

Alex Osenenko: So you put yourself through school?

J. Martin: Yes. So I went back to school and went to San Francisco State. And it turns out actually the person… Maybe a networking story but I went to a class, one of the classes I had there, the teacher actually worked for the State of California. So it was a banking class and he did [inaudible 00:07:58]. And so I’d run into him and I did well in his class and he ended up recruiting me. So again, it’s really tough getting a job with a felony and this and that. Because I had some connection, I can at least go get the interview and then talk about this felony was for this, has nothing to do with this type of job.

Steve Rozenberg: Jay, let me ask you this. I don’t want to get too far down the story and back to when you’re sitting in jail and you’re thinking. You probably went through a lot of mental gymnastics of first probably anger and then maybe thinking it through and then okay, is it my fault? And then going… I’m assuming because many people have these types of situations. What was the moment that you kind of said… At some point, you took responsibility for what’s going on and you were like, “I got to fix this. I got to change this.” Can you just walk through how you mentally did that? Because I think that’s important for people to realize. I’m guessing you were at a point in your life you’re like, ” What am I doing here? How do I get out of this? And I’ve got to do it on my own.” Can you just expand on that a little bit?

J. Martin: Yeah, absolutely. And I agree. I think anytime we face a big challenge, right? We go through the seven stages, or for me, maybe it’s the 20 stages of emotions when I’m in jail. First literally, I was out partying one night. I wake up in the morning with someone banging my door and there’s six police officers or so holding guns over me in the morning, right? Go in and everything’s racing through my mind, what I’ve seen on TV or this or that. I don’t know what jail is like. So a lot of fear I think in the beginning to be honest. For a long part of that, I was really angry and wanted the revenge on the person. Someone ratted me out basically, right?

Steve Rozenberg: Right.

J. Martin: And so I wanted revenge a lot of the time. And it probably took me about maybe a month and a half in jail where I was like, ” You know what, I think there’s some saying like, if you’re going out for revenge dig two graves. One for that person, one for yourself.”

Steve Rozenberg: Wow, that’s sad.

J. Martin: It’s not worth chasing those kinds of things. And I was reading a book every single day in jail, working out three hours a day because I had nothing else to do. But honestly, I think the reading kind of helped me along. Reading these different stories, it’s like,” Yeah, revenge never helps.” And eventually I settled on the point where I was like, ” You know what, never mind about this revenge thing. I’m never going to think about this guy again and I’m going to progress on with my life.” Focusing that energy and attention on negative things or other people or whatever it may be, I just realized was not going to be something that was going to progress me with the path that I wanted to go down.

Steve Rozenberg: Wow.

J. Martin: So yeah, I definitely went through all those emotions and it took a while for me to come to kind of come to peace with the whole thing, take responsibility. It doesn’t matter who ratted me out. I was the one who was selling cocaine, right?

Steve Rozenberg: Yeah.

J. Martin: And I mean this is true and everything. It’s like you got to take that personal responsibility and I think that helped me move on to the point where I said, ” Hey, I’m going to do something positive with this instead of dwelling on it, latching onto it or trying to get revenge or something like that.”

Steve Rozenberg: Yeah. And I’ll tell you what, just that alone, you’d be Uber successful in a major as far as I’m concerned, like one of the top performing winners just thinking that not counting what you’ve done since then. But I just got to tell you, I’m so impressed that you were able to do that because it’s easier said than done. And a lot of people have a hard time not reverting back to that after especially they get out, the pendulum starts swinging and next thing you know, you’re kind of like, ” Maybe I’ll do a little bit or this or that.” And you’ve been able to just go full steam up the other way, which I got to say is hats off, man. Good for you.

J. Martin: Thank you. I appreciate it. I mean, to be honest, I don’t think I’d be where I am today, travelling the world full-time, spending time with friends and family and volunteering and doing this and that if I hadn’t gone through. If I didn’t get that strong kick in the butt to get me motivated. So again, don’t encourage everyone to do that themselves. But again, focus on that motivation what gets you like… what drives you and what makes you want to go do it.

Steve Rozenberg: Sure.

J. Martin: That’s part-

Alex Osenenko: So find your why and connect with it and let go of negative emotions. Instead, rechannel that energy into building up your own future. So that’s pretty profound easier said than done for a lot of us. But sometimes we’ve got to be shocked into it, right? And you got shocked and probably one of the worst possible ways. I don’t think we’ve had anybody on the show shocked this badly, Steve.

Steve Rozenberg: No, I don’t think so.

Alex Osenenko: In to action but there’s always some kind of a catalyst and yours was-

Steve Rozenberg: Yeah. I’m going to say everybody has a different drive and I’ve always learned people do what they must, not what they should. So he should have stopped, but he didn’t. Then when it went to that extreme, he had to stop. He must stop, right? And then it was a turning point, it was at pivotal point and you’re sitting there in a self kind of thinking this through going, ” Okay, I got to make a decision here.” I mean they-

Alex Osenenko: For you Steve. I also have to say for you, it’s 9-11 as a pilot.

Steve Rozenberg: Right.

Alex Osenenko: That’s a very similar concept even though it’s completely different scale, but it’s the same thing. It’s not shock which caused you… I’m going to do this every time those of you watching video, I’m flashing Steve’s book, which causes you to create a dumpster fire in Houston with your first 20 properties or something.

Steve Rozenberg: Yeah, exactly.

Alex Osenenko: Before [inaudible] now. But Jay, I want… Steve to took us away into the mind games and I loved that and that’s very important. I still want to know how you made your first move, man.

J. Martin: Yes. So first move. So basically working for the State of California bank regulation, we’re looking at, wow you can make a bunch of cash flow in the Bay area where it’s traditionally hard to do. I said, ” Hey, there’s opportunity here.” Started talking to all my co-workers and all of them were like, ” Jay, you’re crazy. Real estate is dangerous. Didn’t just see the hundreds of millions that just got lost in the fires from last year. What the hell are you thinking?” And so I almost didn’t do it. Fortunately, I met another real estate investor, co-worker who turned me on to biggerpockets.com, which hopefully everyone’s familiar with. Great real estate networking website. Got on there and here’s where things really changed for me in real estate. From going from knowledge, a little bit of knowledge and thinking about it, to really changing the game. I went to my very first real estate meetup. So someone’s scheduled it on BiggerPockets.

J. Martin: It was someone I knew from before, went to my first meetup and I learned that, ” Hey, I couldn’t just buy a condo with FHA. I could buy a fourplex with FHA. I could buy an investment property.” And from there that planted the seed. When I went to my first meetup, they never did one again. So I started my own because I thought it was so important to learn this stuff and that’s really what changed the game and ended up getting into my first kind of house hack fourplex. It was going at first meetup and networking with people just blew my mind and still does today every time I go out to meetups. So that’s really what kind of changed the game.

Alex Osenenko: Jay, any specific takeaways? Maybe one. Something you remember from your first event like, ” Okay, I know I got it.” So yeah, you could do a fourplex and not just dream bigger, but any other specific maybe tactical stuff that you took away.

J. Martin: Yeah, I think kind of going from big to small. I mean, the first thing I realized is ” Hey, there actually are a bunch of other people just like me doing the same thing.” So that was a great lesson on the technical side learning the fourplex. I think I learned a lot also about making offers and kind of the psychology of sellers and what works, what’s going to actually get deals closed and things like that. So that was another kind of tactical sort of thing I picked up beyond the high level. But I mean, every time I go out and network, you get one idea or meet one person. It kind of helped me along the way or mentor a little bit is so game-changing. You don’t even have to pick up 10 things every time you go. You get one thing or one contact to me. I mean I got two or three there and it totally changed the game for me.

Steve Rozenberg: And Alex, I don’t know if you know our mutual friend Terrell. He had told me that basically, and tell me if this is correct, Jay, is you are kind of the first one to ever do a BiggerPockets style conference and kind of the first one that ever started, is that correct?

J. Martin: Yes. So BiggerPockets did a conference in 2012. I missed it because I didn’t really know about them at the time. I actually met Josh Dorgan who came out to the Bay and he came to one of my meetups. I was kind of chatting with them. They were focusing on the online stuff. So they weren’t doing conferences at the time and I was so inspired, I wanted to basically go to the conference, but it wasn’t going on. So I literally just got on the phone, I looked up everyone starting with podcast number one on BP and went down the list and called everyone and said, ” Hey, I’m doing a conference, do you want to come?”

J. Martin: And a few people, excuse me, it was like, ” Who are you? What?” But I got one speaker. I said, ” Hey, I got Brian Burke coming out, my OG” And it just kind of fell in line. So again, I started the meet up because someone just did one and there was nothing else there. There was kind of a vacuum, at least for meetups that weren’t pitching. And then I wanted to get more people together and I couldn’t find what I wanted, so I created that. I mean, we’re coming up on the fifth summit just coming up here. But I think go find your crew, go find your people, your tribe. And if it’s not already there, go build it.

Alex Osenenko: That’s great. So walk us through your first deal, Jay. Let’s get so. So from a master networker, I think that you are today, back then you were just stumbling child just like me today. Just like me. And so how’d you put together your first deal?

J. Martin: So first deal, I’d made the offers a lot in Oakland and to be honest, there was a lot of cash buyers and I had an FHA loan. It was hard to do. I eventually ended up buying in Richmond. So the things I was looking for were, number one is close to public transit. I think in major metro areas where there’s a lot of traffic, being close to public transit is a huge benefit. Same thing I’ve talked to people on the East coast that do it out here. So I was basically looking near the BART station, do FHA, I’ve got $12,000 down basically on a $380,000 fourplex. It was a vacant home path property, which is a Fannie Mae Foreclosures.

J. Martin: And they gave the opportunity for the first 10 days on market, only owner occupants can put it in an offer. And that was one of the advantages that helped me get in the door so to speak. And that was above the 1% rule. Those who are familiar is basically the monthly rents are more, at least a 1% or more than the purchase price, which tends to be able to produce some cash flow it depends. It’s just a rule of thumb. So that was my first deal. That’s why I bought it. What I was looking for close to public transit. So only 40 minutes to get into San Francisco, close to Oakland.

Alex Osenenko: And you lived there?

J. Martin: Yeah. I moved in. So I moved from San Francisco out to Richmond, which is for those who don’t know is considered a little more dangerous city. I never really had any serious problems out there. And I walked back and forth to Barton, my suite, kind of through the hood every day.

Steve Rozenberg: Oh yeah. It’s street cred now, man. You’re[crosstalk 00:19:26]

Alex Osenenko: You’re going to walk like you own the neighborhood.

Steve Rozenberg: Yeah, man.

J. Martin: Well, yeah, that’s how I got into it. And it produces cash flow from the beginning. I moved into one unit. They were all vacant. Honestly, I didn’t know any… I hadn’t networked enough to meet contractors and this and that. Of course I could look online, but I ended up going down to Home Depot, pick up a bunch of supplies, recruiting some workers from there and literally went back and started working on it myself with the crew from Home Depot, called some friends to help paint and this and that. And that was my first house hack, doing it bare bones myself. To today, I will not touch a paint brush again in my life. But you got to get started, right? In the hustle at the beginning.

Steve Rozenberg: You’ve got to have a zero-

Alex Osenenko: So that property, financially… So walk me Steve, I’m sorry if I’m holding you from a question.

Steve Rozenberg: No complain.

Alex Osenenko: But I want to understand, the five-year-old in me wants to understand the mathematics a little bit, the basic math. All right, so what is your mortgage and what do you get rent? How did that work out?

J. Martin: I believe… I think it was $379 I believe, $379/$389 I purchased the property for. I think the mortgage on that it was probably $1700 or $1800 maybe. I think all in it was probably 25-ish or maybe 2,500-3000. Sorry, I don’t have all the specific numbers. It’s been a little bit. The rents, it was completely empty. So I had to do a lot of research on rents and that [inaudible 00:20:56], what the rents were in the area. It looked like it was about 1200. So I basically figured, ” Hey, I’m gonna live in for free in one of the units and the other three units are going to cover my principle, interest, taxes, insurance, maintenance, et cetera.” Turned out, the rents were going up, I was able to run it for a little bit more. So the rents were actually about $1300-$1400. And now the rents are about 1800, 5-6 years later.

Alex Osenenko: You still own the house?

J. Martin: I still own it. I’ve never sold anything actually. So I bought four properties. This was the first one and the other three with other investors, did 50-50 deals. Haven’t sold anything and man, basically the values have about doubled and the rents are up probably 50-60%, sometimes more from when I first bought them. So I think someone said, ” Don’t wait to buy real estate, buy real estate and wait.”And I think that’s been true for me.

Steve Rozenberg: Alex, this is a perfect example, man of why you need to buy a piece of real estate. Waiting and waiting Alex, I’m telling you, man.

Alex Osenenko: 10 years, man. I’ve been in this 10 years. I know everything there is to know. I think I ask questions and I learn a lot. But hey, it’s been 10 years.

J. Martin: Are you getting your PhD right now? I know some people who are just students. They love… No, I’m just joking.

Alex Osenenko: Yeah, I know. They over analyze it. Look, I got… My investments are a lot of it in equity of the organizations I work in, right? I try to raise them up and build them. So that’s kind of I’m a startup guy but this is not an excuse. This is BS.[crosstalk 00:22:34]

Steve Rozenberg: You’re talking to the wrong people, man when it comes to telling us that story.

J. Martin: Actually, I know I am the interviewee but I got a question for you Alex because I like to challenge everyone on this.It’s like what is your goal in life and if goal is to build those businesses, that’s where you should be spending your time and your money. For me, I wanted to travel more, volunteer more, more time with family. I wanted to kind of free it up. So I’m getting more and more into passive investments. So I’m investing passively in startups. But if you’re always invest, at least to me, if I’m always investing in my own business, where does the passive income come from? If you never invest it passively, it can never come back passively. So I guess my question to you is that your passion? And do you want to invest passively or do you want to invest in things that you’re going to be active with?

Alex Osenenko: Yeah, it’s very good point. So I guess, look, the investments I’m making a fairly risky, right? So if you think about it, but I do control them. And that’s maybe it’s a control issue.

J. Martin: Control?

Alex Osenenko: Right.

J. Martin: Let it go.

Alex Osenenko: Because I’m working. I’m busting my… Doing the best I can. I’m a chief growth officer of the company. I know we’re doing well, man. I know where we’re playing and I’ll do anything like mountains, there’ll be flat when I’m done. And Steve is there with me now we’re flattening more mountains. And so that seems to me as the pretty good way to gauge that in three, four, five years, we’ll get to the outcome we need to. But we’re still depending on the economy and other things going on-

Steve Rozenberg: You’re still intrigued by this real estate world of-

Alex Osenenko: And so that’s the bow. I don’t have a balance. For example, not saying anything bute my other enterprise, it grew very fast, very well. But I shifted gears into this new opportunity and now I’m sort of, I guess a passive investor in my own startup and previous one. But, it’s still risky it’s not real estate. And if I stop, and this is one very interesting one, I’m just unpacking it for myself. If I stop tomorrow, it’s like I can’t work anymore for some reason or I just give up or whatever, I’m poor, I’m screwed.

Steve Rozenberg: Yeah.

J. Martin: That’s actually I think an important thing for investing. But also I look at my own business as I say, if I died tomorrow, would the business still make money? Will all this stuff still go on. But it’s a good question. But like, yeah, if you don’t want to or you can’t work anymore, where’s this passive income coming in from? So at least the way I started and maybe again, everyone has a different path, but I started by building my W-2 income using that to get loans to purchase properties. That started bringing in it’s passive income. Use that to invest in my business and grew my furnished rental business, which is what I’m doing now. A bunch of Airbnb units at 20 something and then use that money now to invest in multifamily syndications, startups, this and that to really build that passive portfolio.

Steve Rozenberg: Wow.

J. Martin: Maybe for those that are out there who had a job. Just speaking a lot of folks on a job and who are trying to get out of their job and this and that and like, it can be a really beneficial cornerstone of building that. But at least that’s one of the methods that I took so that if I can’t or I don’t want to work, there’s still a range of investments that are going to bring in money. So at least that was my goal and kind of what I was trying to achieve so that I could have my own time.

Steve Rozenberg: Now-

J. Martin: In the middle-

Steve Rozenberg: What I’d like to unpack now, which I think is it’s very… I love what he’s doing because I’m a firm believer in leverage and scale. Because what he’s talking about in my opinion, Jay, what you’re referencing is you’ve learned how to leverage other people and you’ve learned how to scale to live the life that you want to live. So, I remember Terrell and Grace and I, where we are now, at, I remember they told us. They said, ” We had our life and we’ve worked it around our business.” And they said, ” We flip flopped it.” And we said, ” We want to have our life and our business has to operate around our life.”

J. Martin: Yeah.

Steve Rozenberg: And which is a different way to think about it, right? Normally whenever we have free time that we’re not working, then we go ahead and do stuff.

J. Martin: Yeah.

Steve Rozenberg: You just like Grace and Terrell, just like a lot of the people that we’ve met interviewing these shows, have the other way of doing it. They say, ” I have my life and the business revolves around my life.”

J. Martin: Yeah.

Steve Rozenberg: Let’s talk about that now because when I met you, you were just coming from, I think it was Malaysia and you were heading to Bali after you spent another two weeks in Maui. You’re like, ” Yeah, I’m coming over to Bali for a couple of weeks.” So let’s talk about that.

J. Martin: You see it’s funny too because I learned there was no flights from Bali to Hawaii. It took me a lot to get to that [inaudible]

Steve Rozenberg: First world problems-

J. Martin: Who the hell is flying from one tropical place to another tropical place, right? Why would you leave in the first place. So I mean for me, number one is the same pay it first or pay yourself first, right? So people talk about that in your business, right? You want to pay your own salary first or whatever. So you don’t end up living on the scraps from your business. I think the same is true for time. Pay yourself for your time first. Some people make a financial budget, make a time budget. How do you want to spend your time? So if you were a billionaire, how would you spend your time? And then you want to get as close to that as you can earlier. You don’t have to wait until you’re a billionaire, you don’t have to wait till retirement to start doing the things that you want.

Steve Rozenberg: You got to think like one right now?

J. Martin: Exactly. And if you pay yourself first with your time, budget out the time you want to spend with your family, that you want to travel, go do all those things and then say, ” Hey, how can I operate my business successfully within the time that’s left?” And that I think gets you focused, productive and again that pay yourself first principle. So I think that’s a great way to think about it. So just focus on your personal time first, use what’s leftover for the business and then like you say, leveraging other people’s time. So I have myt furnish rental business at 20 something units in the San Francisco Bay area.

J. Martin: I have three people that work in the Philippines. I wish I would’ve met you earlier, Steve, because I could use a lot of your advice for hiring people. So I did it the hard way without knowing, but I have three people. Basically one’s a manager and the other two, they run my entire business. So I just approve payments, review reports and every month or three I jump on a meeting with my manager. And so that’s why I’ve managed to kind of leverage my time up and be able to free up but I had to give up control.

Alex Osenenko: See, that is interesting and there’s different paths for different people, but real estate is still a very important vehicle to get us to our paths. But in my case and Steve’s case, look, who’s asking question? Those of you who are listening and have followed Steve for a while may already know those of you or not, Well let me just kind of get them naked out there in front of all of us, right?

J. Martin: Perfect, yeah.

Alex Osenenko: He’s got two full-time jobs, this guy. Okay. He’s talking about passive income and stuff like that. Steve’s got two full-time jobs, he’s flying for United and he’s vice president at a very fast growing startup.

J. Martin: Yeah.

Alex Osenenko: Well, what do you say to that Steve?

Steve Rozenberg: Well, here’s the thing, here’s my thoughts, and this is just my opinion. The flying that I do, that’s a passion. I mean, that’s something that when I was a little kid, I remember looking up in the sky going, “Man, how do they do that? I’d love to do that one day.” So people tell me all the time, they’re like, ” Hey, why don’t you quit flying? Could you quit?” They’re like, ” Oh, you’re probably going to quit after I sold my business.” They’re like, ” You’re probably going to quit flying.” I’m like, ” Why would I quit flying? This is a dream of what I want to do” Now, when it stops becoming the dream then and it becomes a problem, different story. But right now I’m like, I get paid to travel around the world and I get to fly up a $200 million airplane and get to do it.

Steve Rozenberg: You’re like a kid in a candy store. So that and then when it comes to educating and speaking and interacting with people like Jay and, Brandon Turner and all these people, that’s another dream because you’re interacting with like-minded people. So even though it’s working, I don’t think of it as working, right? I’m not in a nine to five where it’s like I got to clock in, I got to do this. I do it because I love doing it and that’s I think the only difference. I have a hard time. My personal thing is I have a hard time stopping and because I like it so much, I’m not kind of… It’s not controlling me, but I have a hard time shutting it off. I guess I would say, that’s the challenge I have.

Alex Osenenko: But that’s exactly how it feels Steve. I love what I do. I freaking… I come home, I can’t wait. Well last night I can’t say I can’t wait. But we put kids to bed and sometimes I have to work even before that. I’ll break for dinner and my wife’s like, “Yeah, make some money, man. Do what you need to do. I don’t need you around the house moping around, getting in the underfoot. You go in the little office.” Which is here where I’m at today and get work done so we can have the vacations, we can have the time we want and weekends on my own of course. But I work 14 hours a day and I love it.

J. Martin: Wow.

Alex Osenenko: I’m not joking.

J. Martin: Yeah. And I think, I mean, this is such a key thing though too. Is whatever the passion is… I was actually giving a speech the other night and originally someone labeled it. It was like, quit your job to travel the world with real estate and I actually changed it to quit your job and do whatever you want, right?

Steve Rozenberg: Right.

Alex Osenenko: Because everyone’s got a passion and just like you said Steve, your passion is flying and you do that right now. But you’ve set yourself up so that you don’t have to fly when you don’t want to. So if there comes a time when you decide, ” Hey, I’d rather be doing something else.” You’ve set up a way that you have financial independence and time freedom so you don’t have to do that forever. And I think that’s the big change, right? You can do whatever you want and then looking forward 10 hours a day flying a plane. One of my wealthy buddy does is he’s taking a year to remodel his unit because he goes out there and hangs drywall himself and I’m like, ” You’re crazy.” But he’s like, ” I love doing this. I’m okay.” But I think it’s important to just know what you like, know what you love, what you’re passionate about and at least spend some time on those things. And then if they don’t make a lot of money, either find a way to make money or make enough in the rest to support that passion.

Steve Rozenberg: Right. Yeah. And you know Alex, I’ll say the one thing I noticed that because I have real estate and then I’ve got other assets and stuff like that and doing the mind VP thing and stuff. When I get in the cockpit with other pilots, right? And pilots financially do very well. They make a lot of money and it’s not about the money, but when I’m sitting there talking with them and they are just complaining about the company and, ” Oh, did you hear about the union doing this?” And I don’t pay attention to any of that. I’m not on any union emails. I don’t get any information.

J. Martin: Yeah. You’re like, ” I’m flying to Sydney and I’m buying real estate.”

Steve Rozenberg: Exactly. I just want to go to Australia and have a good time and that’s what I want to do. So it’s such a different dynamic because they are clinging to that job and they’re bitter. And I’m thinking to myself, I always think of the Guns N’ Roses theory, right? Guns N’ Roses was making gazillions of dollars and they broke up. It’s not about the money, right? Because at some point the money, that motivation fades, right? It’s the why, it’s the desire, it’s what you want to do. I get in the car and I’m like, ” Dude, let’s go have a good time. Let’s go to Sydney and then let’s go golf and do whatever and talk to real estate. I do some speaking events down there, let’s enjoy this.” And they’re like, ” Oh man, did you hear that we’re not getting paid this ad pay or this or that.” And I’m like, ” Who cares man?” It’s such a difference because I don’t need the job, they do. That’s the difference.

Alex Osenenko: Thanks, Steve. You just busted my butt over your $2 of your bonus difference.

Steve Rozenberg: [inaudible] text you yesterday.

Alex Osenenko: I can show. It was like, ” Hey Alex [crosstalk 00:34:26]. I thought I was going to get $2 more.” I guess that’s Renne, she does that-

Steve Rozenberg: That’s my wife. She’s like, ” Wait-

Alex Osenenko: You’re not bringing all the bacon they promised.

Steve Rozenberg: That’s right.

J. Martin: But this, I mean to me, this really goes back to mindset, right? Not mind, m.y.n.d, mindset no. But it’s really about how you think about things, right? So for some people they’re just going to do the W-2 job. That’s what they’ve known for their entire life, that’s what they grew up, right? You go to school, you go to college, you get the job, you retire at whatever’s, 61 years old and die at 62. They’ve been going along-

Alex Osenenko: [crosstalk] life fishing man, nigga. At least few months.

J. Martin: Yeah. But I mean, I think it’s the whole mindset thing, right? It’s realizing that there’s more potential and I think focusing the energy on what’s important, right? So I was talking about in jail focusing on revenge or how I’m gonna find the path forward, right? And focusing on the things that are not working well or whatever. If that time and energy we’re focused on some income producing activity, it’d produce 10 times or a hundred times more than what was lost, focusing the energy on what was lost and some other little thing I think.

J. Martin: So I used that mindset and it’s really whatever you want, how much you will ever want to make, whatever you want to do in life. Again, someone coming from jail who thought I wasn’t going to be able to get a job or a place to live, to be able to travel the world. Whatever obstacle you have in front of you. I haven’t even had the most challenging. There’s other people who had much larger challenges than myself, right? So I think wherever people are at, I just want them to know, right? They can overcome that, they can go do that. And it’s just it’s all about the mindset. Don’t get stuck in that attitude as other pilots who just complain about their job.

Steve Rozenberg: That’s right man.

Alex Osenenko: That’s really good, Jay. That’s really good. So, let’s tell people… I think your event is coming up, but we’re likely not going to publish this show before the event shows up. So maybe tell people if they want to come see you, meet you, check out one of your events, where will they go to do that?

J. Martin: Yeah, absolutely. So I mean, number one just go out and network, right? So go hop on BiggerPockets in the community section or meetup.com and go find a networking event near you. Go to a conference, go check stuff out. Our event, again, a lot of folks from BiggerPockets and from the San Francisco Bay area and around the country. But our website is SFBsummit.com. We do it every year. So again, if you make it out another year, come check it out. But whatever you do, I really encourage people, network. Again, one idea, one contact, one person can really change your investing life. And I’ve met a lot of great friends I’ve traveled the world with too. So just go out there and go meet someone.

Alex Osenenko: Awesome, Jay, and I’ll look forward to… I’ll make sure I make it to the event that you’re putting on in a few weeks here. So looking forward to meeting you in person.

J. Martin: And we’re excited to have Steve out speaking to. So-

Steve Rozenberg: That’s right baby.

Alex Osenenko: [crosstalk] Somehow people love him. I don’t know what it is.

Steve Rozenberg: You’re just jealous and a little intimidated. Better be nice, I don’t know.

Alex Osenenko: I saw a guy who looks just like Steven Janell actually. The first time I met him I thought he was going to beat me up. But he’s just the sweetest lovable bear. So, yeah. I think there’s something to it. So those of you who are listening, we really appreciate your time. Hope you took a lot away. I think at the end of the day, Jay’s whole concept of winning revolves around networking and he’s doing, he’s living what he’s teaching and his incredible inspirational story. And if you want to meet him, go to Facebook, dial up Mastermynd with a Y, Real Estate Investment Club. Hopefully Jay will join and be active in that little group. BiggerPockets is a great outlet, SFB events, check him out. And thank you very much for listening and Steven and I really appreciate it. If you can go and give us a review. If you love the show, this will really help us out on iTunes or Spotify or however you get this podcast.

Steve Rozenberg: Yeah. And again, Jay, thanks so much man. And I think I’ll say that I’m just going to wrap this up that you don’t meet… People think you meet people like Jay and Alex and all these other people by luck they say, ” Oh, they’re lucky. Jay just got lucky. Yeah. He got juggled lucky.” It’s not luck, it’s intentional focus. And I think that that is the most important thing that I’ve learned is that it doesn’t matter the cards that you’re dealt. It’s the intentional focus you have in the people that you want to meet. I’ve gotten to meet Jay, I’ve gotten to meet all these other people through networking.

Steve Rozenberg: I mean that’s all it is. I mean, all the Brandon Turners and Ryan and, Terrell. I mean all the people that we met in Maui, we all came together and now that is exploded in the different areas and markets and stuff and it’s just networking. I mean that’s all it is. Being genuine and having focus to be better and mix with those kinds of people. So Jay, man, I got tons of respect for your brother. I really loved the story and man, I’m hoping one day we’re going to be in the same destination at the same time. That’s what I’m hoping, man.

J. Martin: Let’s do it. I’m all over the place. I’ll make a trip out to Sydney and see you there either way.

Steve Rozenberg: There we go. So on behalf of Jay, Alex, myself, thanks for watching. Make sure that you like subscribe to our show. I’m out there speaking all the time. Jay’s out there doing his meetup. So just get out there and network, right? You can hang out with us. We want to meet you too and that’s what this is about. So thanks everyone for watching. We’ll see you next week. Bye-bye.

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How AB 1482, or Statewide Rent Control, Impacts California Single-Family Rentals

The state of California is on the verge of joining Oregon as the only two states in the country to implement statewide rent control. Recently approved by the California Senate, Assembly Bill () 1482 is slated to become law on Jan. 1, 2020. 1482 legalizes statewide rent control and allows most property owners to only raise rents by 5% annually. But there are some exceptions. Does this newly-passed law impact your property as a single-family rental () investor?

Legal Expert Giles Imrie Discusses Rent Control’s Impact on Market

Today we’re discussing the implications of the recent passing of statewide rent control, known as 1482. You're going to hear that number, as a landlord quite a bit, and so what we want to do is talk through some of the potential implications and how you can make sure that you can protect yourself and your rental property from issues that may arise if you don't follow the law. My guest today is the vice president of corporate counsel at Mynd Property Management, Giles Imrie. Alex Osenenko: So, Giles has14 years of legal experience in real estate and the question we're going to tackle today is this: Is my single-family rental in California impacted by 1482?Giles Emery: The short answer is yes, Alex. Previously, single-family homes were carved out of rent control ordinances, but this Assembly Bill does impact your single-family homes in one way or another. It may be a minor impact or not. I'll explain what I mean by minor but assuming you don't qualify for one of the stated exemptions that are laid out in this bill, then your single-family home is now subject to both the rental cap that's imposed under this ordinance and the just cause aspect of it as well. There are some nuances that still allow you to maintain your protections as a single-family homeowner. Assuming you do qualify for those, and I'll go into those in a little bit, then you still need to provide notice to your residents. Going forward, you will need to add a provision to your lease that notifies your resident that the property is exempt. This specifically references the civil code and explains to them that your property is exempt from the rent cap and the just cause ordinance, assuming you do qualify for one of those exemptions.Alex: So Giles, are you saying that in 1482 impacts all single-family homes or there's a specific subset.Giles: Well, it does impact in that even if you qualify for an exemption, in order to maintain and get the benefit of that exemption, you now need to actually give the statutory reference in your lease and failure to do so could mean that you are subject to the rent cap when you otherwise would not be. So, yes.Alex: To finish my point, you can bypass this by having a specific provision with a release but then exempt you?Giles: Assuming you qualify for extra threshold.Alex: Which we're going to talk about in this next episode. So, but for now, let's get to the basics.Giles: The basics. Yes, I just wanted to carve out that there are some little gotchas in here that even though you do qualify for one of the exemptions, you’ve got to add statutory language that you previously didn’t have to your lease in order to maintain the benefit of that exemption.Alex:Gotcha. And the rent cap, some of the key takeaways from this law. So the rent cap is what?Giles: So, you are now limited on your annual rent increases to 5%, plus the price of inflation for the prior year. And that’s measured by the consumer price index (). There is a look back to March 15, which is basically intended to prevent landlords from spiking rents before it goes into effect. But the go-forward rent increase cap, they call the rent cap would be 5% plus the .Alex: Which is about 2 to 2.5% now as we speak today?Giles: 2 to 3%.Alex: All right, so I think this is the takeaway: Your single-family rental may be allowed for exemption, but you have to understand how to properly document this, and have a specific provision in the lease. Is that correct?Giles: Yes.Alex: So, can you give us a little more color on like how do you do that?Giles: Single-family homeowners are exempt from this ordinance. This bill applies to any corporation or real estate investment trust. My background in real estate is with REITs, so this is geared towards the REIT industry, which only constitutes about 3% of the single-family rental market in the U.S.Nonetheless, () corporations, REITs and limited liability companies. But if you’re an individual that owns a limited liability company, then this does not apply and you’re treated just like any other individual owner. You are not subject to the bill provided you include that newly required written disclosure in your lease, specifically advising your tenant that you are not subject to this ordinance or this bill.Alex: Gotcha. So they need to know upfront that this property would not comply with the rent increase?Giles: Correct.Alex: All right, Giles. That was good. On the next episode, we'll dive into the specific rental ownership entity type, individual versus entity and how that gets applied based on 1482. Thank you very much for watching. If you want to go to mynd.co, type in: 1482 mynd.co. That's our company. You'll see a series of interviews that Giles and I are doing on this subject. We hope this helped you out. Until next time, and thank you for watching.

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The Myndful Investor Podcast Show, Episode Zero

Steve Rozenberg and Alex Osenenko introduce themselves on Episode 0 of the Myndful Investor Podcast show and discuss how to overcome the fear of getting started when it comes to investing.

Podcast transcript

Alex Osenenko: Boys and girls, welcome to the first episode of The Myndful Investor podcast Show. Your hosts here, Alex Osenenko and-
Steve Rozenberg: Steve Rozenberg.
Alex Osenenko: Steve Rozenberg. Good buddy. This might not be episode one, this is episode zero. Why don’t you introduce the series do.
Steve Rozenberg: Sure.
Alex Osenenko: So, very quick background. Steve and I have spent the last probably decade plus in real estate in various-
Steve Rozenberg: various forms
Alex Osenenko: various forms. We don’t have to dig in too much into it, but the takeaways is we want to still provide on this episode and this very, very first, first episode is, how do you deal with fear of getting started? This is something that I think is in the way of a lot of people’s success.
Steve Rozenberg: Sure. It’s sometimes it prohibits them from success because they just don’t take action. And I don’t think it’s just real estate. I think it’s anything that they do whether it’s we’ll talk about us making decisions to you know, join Mynd and leave our businesses and join our companies together. And all the things that we’ve done. But those are big things that lack of action would not cause us to be here.
Alex Osenenko: Huge. Or there’s risk-tolerance. So let’s start unpacking this.
Steve Rozenberg: Yeah.
Alex Osenenko: So this is The Myndful Investor podcast show boys and girls. Our purpose here, our goal is to bring reality data, facts for real estate investors who are about to make an investment or can, will continue to be successful making investments, maybe pivot into different types of investments. We’re going to cover a lot of things here, but the underlying purpose for us is to make sure we provide you with data and fact driven stuff, but also in story format.
Steve Rozenberg: Yeah. And you know, the one thing I think that a lot of people have a challenge with is when they, they want to get involved in investing and they want to see and seek out how to get wealth. I think the biggest challenges is that everybody shows you kind of how to get the deal. You know, the sexy, how I can make a bunch of cash on cash return and investments. But there’s nobody there that actually shows you what do you do on day two? Once you own that deal, like you get a deal that says this is going to be a 30% cash on cash return and this is going to be these numbers. But the next thing is what do you do on day five when the tenant says, I lost my job and I’m not leaving. And so we’re going to talk to the investors in my opinion and discuss how did you guys as investors get around those kinds of things and how did you work through those problems?
Because as investing, I always tell people this is the sandbox that we play in. We’re in a sandbox where there are a lot of challenges. There’s a lot of, the good thing about real estate is there’s no rules. The bad thing about real estate is there’s no rules. So it’s, good and it’s bad. And if you know, unfortunately when you’re in this industry, there’s really nobody there. There’s no guidelines to tell you whether you’re doing right or doing wrong.
Alex Osenenko: You know what Warren buffet said, which is like stays with me forever. He’s like, he’s never, he would never make an investment in the business or company. He does not understand. Completely. He’s a smart guy? He understands a lot of things. But this is kind of the… This show’s purpose is to help you understand. Whether it’s a specific vertical you want to get into. But even before getting like super educated on a particular vertical, let’s call it, buy and hold or-
Steve Rozenberg: Flipping [crosstalk 00:00:03:53]. Or maybe
Alex Osenenko: and within buying hold, there’s single-family, there’s multi-facets-
Steve Rozenberg: Absolutely there’s so many ways.
Alex Osenenko: There’s Houston, there’s Boise, there’s Albuquerque, right?
Steve Rozenberg: It cascades down. I mean it’s, it’s such a deep cavernous column. People don’t realize. And that’s a good point cause I think a lot of people, they want to get into investing. There’s all these people that show them how to get the deal, but there’s nobody to show you how to create the wealth.
And they never, and I think that a lot of people, they don’t want to take the time to slow down, to speed up. They don’t want to take the time to educate themselves on how to actually get the wealth. They just want the wealth. And I think all of us want that, right?
We just want to make it happen. And unfortunately there’s people that have hands in your pockets, they want to make money off of you. They see the a-
Alex Osenenko: especially in this business,
Steve Rozenberg: absolutely.
Alex Osenenko: there’s a loosely say, there’s no rules-
Steve Rozenberg: there’s no rules. That’s the problem.
Alex Osenenko: You can put a syndication. You can announce syndication on this show and there will be people who will-
Steve Rozenberg: Absolutely [crosstalk 00:04:47]. absolutely. And you know the whole, like you had said, the whole goal of this show is not to talk about the glory of some of these investors that we’ve had on the show and going to have on our show-
Alex Osenenko: cause their shows like that. Everybody’s just coming in and-
Steve Rozenberg: everybody showing me how broke they are, how much money they make. I don’t want to know that. You know, we want to know and I want to know personally, like first of all, how did you get to where you are and how do you continue to drive yourself to be a better person, better?
You know, because a lot of people on the show are going to learn that a lot of the people that we talk to, the one common thread that you’re going to find with a lot of these investors is the balance of their personal life and how happy they are on a personal level, not just a fine, it’s not just a numbers thing of owning investments. They’re doing it to create a lifestyle for them and for their family. And it’s very interesting to see how people that are creating wealth and being wealthy, how they actually will continue to do it. They’ve already made the money. They don’t need the money. They’re doing it to keep the lifestyle that they want to have and the balance with their family, which is totally different than a lot of other fields and investment, industries that I’ve ever known of.
Alex Osenenko: But it’s also a gain.
Steve Rozenberg: Absolutely.
Alex Osenenko: Once you get-
Steve Rozenberg: it’s the thrill of the hunt.
Alex Osenenko: We spoke to Jay and we’re about to sort of J Scott, we’re about to announce like what this first series is going to be all about the first season I should say. But like the J Scott and I, he’s the thrill of the deal.
Steve Rozenberg: Oh yeah.
Alex Osenenko: he’s, well, he’s fine. He’s very happy like they, but like what are you going to do if you are not, if you’re not, if he is just sit there and enjoy me. I guess some people can go to the library and ski all day.
But the folks that will listen to the show, I think will find thrill of the deal. But also that, as you said, not just the deal thrill of the deal is like step one, but then it’s the day to day management.
Steve Rozenberg: Yeah. Yeah, absolutely.
Alex Osenenko: Of your portfolio. It’s-
Steve Rozenberg: It’s the all encompassing. It’s almost like you’re, you’re living not a mantra, but you’re living a lifestyle.
And we had a doctor, Dr. Steve on, right.
Alex Osenenko: Is an interesting-
Steve Rozenberg: [crosstalk 00:06:46] he’s a doctor and he owns a lot of real estate. Has no desire to quit being a doctor. Very successful. And so-
Alex Osenenko: wait, wait, no, no, no, no. He wanted to quit. That’s why the whole episode was about, don’t you remember? He actually-
Steve Rozenberg: I thought at the end he said he didn’t want to quit. So we got him there.
Alex Osenenko: But, so this is very interesting episode and look forward to that episode.
Steve Rozenberg: Yeah, that was a good episode.
Alex Osenenko: There’s the MD, like legit one of the best doctors- [crosstalk 00:07:09]
Steve Rozenberg: Put himself in medical school [crosstalk 00:07:10] on his own.
Alex Osenenko: Oh yeah, Oh yeah. Is this fascinating story. And what happens is he now wants to go real estate full time just because he loves-
Steve Rozenberg: he loves it.
Alex Osenenko: He loves the dynamic of it, he understood it. He is the kind of guy, like he went through the pilot school. He’s the kind of guy who put his mind to something and just get it done.
Steve Rozenberg: Did it.
Alex Osenenko: He’d be like a top 1%.
Steve Rozenberg: Yeah, absolutely.
Alex Osenenko: But he wants to quit MD and be… So eventually I think where we got with him, I’m not going to give too much away.
Steve Rozenberg: Don’t give too much.
Alex Osenenko: but there’s an opportunity for him to continue practicing medicine and a lot less intense way.
Steve Rozenberg: Yeah, because he doesn’t need the money. Cause he does it. He’s doing what he loves doing and money’s not a problem. And so that’s what you’re going to learn with a lot of these people. And what we’re trying to extract from the show with a lot of these guests is that you’re going to find, there’s a lot of people that have different work life balances that are very successful. Some that money is not the driver, but they are successful, but that doesn’t drive them.
And so it’s going to be a way that you as an investor or aspiring investor or experienced investor, whatever it is at your… Wherever you are in your stage of your career. You’re going to look at that and maybe do some self reflection and kind of go, Hmm, I wonder how this applies to me. I wonder if there’s some things that I could do better. I could do different. Maybe I can’t do any of these at all, but I think that you’re going to do some self reflection on that from these people that we talked to. I’m very unassuming but very successful and I think you’re going to get a lot of very good takeaways from that. Just like you and I did because you had a business, right? You owned a business, you removed yourself from that business and joined another company.
There a lot of self reflection that has to go on before you do something like that. Right?
Alex Osenenko: I mean it’s incredible. So let’s shift, let’s shift to that part of the conversation. By the way, those of you folks listening or watching, if you’re watching, thank you. You can just go into the next episode, if you want to get dig into the content and stuff. But Steve and I will talk about next is very quickly talk about how to actually get started. So I think those of you who have not, maybe you want to stick around a little bit, there’s a mental shift that has to happen. Like I didn’t use to believe in any of that Voodo sheesh, right? To me it was all, it was just like-
If you are smart enough if you work hard enough, you get there.
Steve Rozenberg: Right.
Alex Osenenko: You get there, you work hard enough. You’re smart enough, you’ll get there.
Steve Rozenberg: Yeah. It’s not always the case.
Alex Osenenko: No.
Steve Rozenberg: I know a lot of smart people that make [crosstalk 00:09:31] no money and they’re not happy either.
Alex Osenenko: It’s not even about money. Right? It’s like, you know what the doctor wanted to… Dr. Steve wanted to make a move. I think, I mean I clearly remember there’s a lot of administration stuff.
With his profession [crosstalk 00:09:46] that he just doesn’t… With real estate frees him up to do what he loves. With doctoring, he wants to cure people. He loves that.
Steve Rozenberg: He loves it. He loves… He was saying, he loved being there when a baby is born and even when somebody passes on, he feels like he’s a part of that. It’s something almost holistic. He said that you’re a part of this whole cycle of life.
But if you’re just sitting there trying to get a paycheck. You’re not even paying attention to that part of the job. Which is probably why you even got involved in being a doctor in the first place. Or you know, Jay Scott, right? He’s, got race horses, right? He spends so much time with his family. Brandon Turner, you’ve got all these people that we know that are just so focused on doing what they want to do. They can enjoy their family because they’ve taken those, I don’t even want to say calculated risks, but they’ve been so smart and understanding what their next steps are because they’ve watched shows like this. They’ve educated themselves. Sure, they’ve made mistakes. We’re all going to make mistakes.
You know, it’s not a failure unless you learn from it. If you learn from it, then it’s a lesson, right? I mean, but it’s just one of those things. And I think what we want to unpack in these shows is why these people are being successful and how you are just like these people. And you can be successful too. You’ve just maybe have to change your mindset and think a little bit differently. Would you agree?
Alex Osenenko: Yeah, I would agree and the passion plays into it. I’m just wondering like I want to first step this out or point 0.01 episode. I want to introduce our behind the scenes guy. Dan, I’m just curious, Dan, are you passionate about the video? I mean, you out there fill me-
Steve Rozenberg: You look passionate.
Alex Osenenko: You sipping on a Corona. You look a little passionate there Dan. Anyways, so Dan is our… You’ll see the quality of what we produced.
Steve Rozenberg: Yes, absolutely.
Alex Osenenko: That will be his top-notch quality.
Steve Rozenberg: It’s going to be top-notch quality. It’s going be the level of people we have, the thought processes we have, the access to educational levels that we’re going to be able to bring in. I mean, I think it’s going to be bar none, one of the best, if not the best shows that are out there with current constant education at a ground level. I think.
Alex Osenenko: Let’s talk about this. Let’s… we promise this, let’s talk about this. Let’s talk about your move that you made.
Steve Rozenberg: Why am I first.
Alex Osenenko: I don’t know cause I’m the one speaking.
Steve Rozenberg: Okay, fair enough you be first.
Alex Osenenko: I’m the one asking the question. And so you’ve made a significant move. So I’ll give a quick pre-story.
You’ve been an investor and I’m going to move out the chair for a second cause I want to grab your book. Oh, we’re using it as a coaster.
Steve Rozenberg: Yeah, They threw it on the floor. [crosstalk 00:12:16]. It was on the way and they threw it on the floor.
Alex Osenenko: So there was kind of-
Steve Rozenberg: A lot of respect-
Alex Osenenko: [crosstalk 00:12:21] to throw it in my face.
Steve Rozenberg: for my workings.
Alex Osenenko: Hey you sign my book, we’re not selling any books.
But the idea is, he was a failed investor, Steve, because it looked good on paper and they kept on buying it and when it didn’t work, you know what was a good idea?
Steve Rozenberg: Buy more of them. Buy more, why not?
Alex Osenenko: Buy more and so from there he said he couldn’t manage it. So started a management company, very successful Gouda company to 900 properties that can manage.
Steve Rozenberg: 900 doors. Yeah.
Alex Osenenko: In Houston and all of a sudden the things like he’s one of the fastest growing companies in Texas.
Got like 500s of five-star Google reviews. I mean, absolutely dominating. And guess what happened? Steve decided to make a move and partner with mine. So in other words, essentially sell his company to mine. In order for a chance to join and become host of this show. That was a big deal, wasn’t it?
Steve Rozenberg: Absolutely. It’s to me again… I’ve always learned in my life and this is something I think a lot of people can take away. What gets you here is not going to get you there. You and I have had these conversations and I think life and someone told this to me one time and it really resonated with me that life is like a book and you have chapters and there’s a chapter that could be a great chapter, but at some point that chapter ends and when that chapter ends, a new chapter begins and you don’t go back to that chapter again. And the company, Pete Neubig and I built and the team that we had. It was a great chapter and it got us to the next chapter and the next chapter is going to be better chapter.
And that’ll be a chapter after that. And I think that’s life. And I think that a lot of people never flip that page and they never move on to the next chapter. And maybe they slide backwards. And so I think the biggest challenge, the thing that I learned was this is just part of the growth cycle. It’s like leaving high school, right? We all know friends in high school that never left high school. They’re still, they’re mentally talking about the days of high school. They’ve never left there. And so a lot of people, same thing in business, some people just do not want to leave the comfort zone of their business. And look, you read these books, you do the audios and you hear like, you know what, you have to be comfortable being uncomfortable and that’s all well and good until you really are uncomfortable.
And now you’ve got, it’s like the rubber meets the road.
Alex Osenenko: That’s growth, that’s when the growth happens
Steve Rozenberg: It’s growth. You have to be okay. And at some point you’ve got to say, you know what? I’m going to trust the process. I’m going to trust my education. I’m going to trust everything I’m doing. I’m going to shut this chapter and I’m going to move onto the next. And that, that’s kind of what I did. I just… I trusted the process. I trusted you. The people at mind, everybody that was involved in helping us come over. I trusted it and I said, you know what? Based on educated calculated decisions based on everything that I think that mind will be able to provide for me and where the future is with mind. It was a no brainer. But there’s still that risk. You’re leaving your own company that’s doing fine. That’s very successful.
Alex Osenenko: No brainer. People say that in a rear view mirror, it’s no brainer. When you in the-
Steve Rozenberg: When you’re in the turn, it’s not as easy.
Alex Osenenko: Remember we talked about your role, so now you’re VP of investor education. We’ve talked about your role. We had a lot of back and forth. Those emotional moments. It’s difficult guys and girls it’s definitely difficult.
Steve Rozenberg: Not easy.
Alex Osenenko: Can I unpack something you said?
Steve Rozenberg: Sure.
Alex Osenenko: You said there’s a chapter. I love that, by the way. You always teach me new things. Oh, it’s mine now.
Steve Rozenberg: Dan quote that.
Alex Osenenko: So it chapters, how do you know this is, I sometimes have problems with this. How do you know when the chapter is coming to an end? Is it when you see a new opportunity, and it’s like, Whoa, you know, it’s it. Like how do you know when the chapters ending, how not to hold on for too long [inaudible 00:15:58].
Steve Rozenberg: You know, I think that’s different for everybody, but I think sometimes the chapter closes already and you don’t realize it. Like your chapter… you may have a chapter that’s already closed and you are just not accepting that it’s closed. Sometimes when we’re… When you’re in the heat of battle and you’re kind of in the weeds. And again, this chapter this… The books over the book, the movies over, right? The, the credits are rolling and you’re still sitting there not leaving the movie theater. Right. And so sometimes we may not want to it accept that that chapter is over in our life.
Alex Osenenko: Do you have an example, by any chance, can you think of an example of someone you know. You don’t have to name names. Or maybe yourself where you sort of overstayed your welcome per se? I mean-
Steve Rozenberg: I never overstayed my welcome.
Alex Osenenko: You wheeled in a bag today, your airline bag into my house
Steve Rozenberg: Yes, yes, yes to my house. And he said, are you staying here tonight?
Alex Osenenko: You did not tell me anything. Maybe we’ll cover that. But is there a chapter?
Steve Rozenberg: I don’t know that I have a chapter, I mean maybe I do that I don’t know about. But I think at… My thought… I’ve learned… I’ll give you a perfect example where I made a decision, a lot of indicators. So you know my, my being an airline pilot, right? So that chapter 9/11 that chapter ended, right? So for me now, I still stayed as an airline pilot, but after 9/11 there was a new chapter I didn’t want to… A lot of people did not want to accept it. So what did a lot of people do? They went down to South America to fly. They went over to Asia and they flew airplanes at a quarter of the income that you are making as a U S airline pilot. Why? Because they didn’t want to accept that things were changed and they didn’t make the decision to flip the page and start a new chapter.
I said, you know what, I love being a pilot. However, I’m not going to let this dictate me anymore and what I’m going to do is I’m going to take control of my future and start learning about real estate. A lot of other people said, I’m going to Korea. I’ll be there for three years flying small planes until this thing weeds itself out. To me, that’s not accepting that the chapter has ended. So that’s the best way I could describe how a chapter can change and you not accepting that it’s changed. Because all the indicators were that the airline industry as a whole will never be the same again.
Alex Osenenko: That’s very good.
Steve Rozenberg: So that, that’s how I would basically essentially say that’s how you know it, but enough about me. Let’s talk about you Alex.
Alex Osenenko: Dude, I can’t believe like, I can’t believe how like we’ve done podcasts in the past, but I can’t believe like how this is connected because I was just going to say, Dan, stop the recording for a second. Steve, why don’t you ask me about me now? We only have 20 minutes to this 0.01 episode. We want to be respectful to the audience. They don’t want… us yammer for 20 minutes. They want to get into the meat of what this is all about. Which is top-notch education validated with a couple of guys .
Steve Rozenberg: So based on this conversation, we’re talking about people making a decision and moving on and things happening, right? So you had a company, right? You had a very successful company, still do, still have the company and you made a decision to basically essentially remove yourself and join mine. Right? Essentially he’s my boss, so I got to be somewhat nice to him, I guess. But you know, basically you, you made a decision, right? And calculated or not the chapter ended, right? Some chapter ended and again, it’s not just you, right? You’ve got a wife, you’ve got children, there’s a whole trail behind you that are affected. There’s a ripple effect, right.
Alex Osenenko: There’s also people in the current, in the company I left
Steve Rozenberg: in the company left. Yeah. The allegiance going, Hey, where’s Alex? Alex, you know, and so there’s, maybe a guilt factor at some level to go, man, how do I do this? Am I doing the right thing? Am I being selfish? Am I being, am I doing the right thing for my family? How did you unpack all that and go through those iterations mentally?
Alex Osenenko: Definitely a lot of guilt. Definitely a lot of sort of second guessing yourself. That’s, I think that’s all normal. But like you will laugh. Maybe a stoicism is something that I am sort of investing in right now. My sort of mental resources and Tim Ferriss is my favorite podcaster and he’s big. He wrote this book, the Towel of Seneca and anyway, it’s very interesting philosophy on how to sort of deal with change. But the way I think about this is, one life. I think I learned it from you. Like you only have like 4,900 whatever however many-
Steve Rozenberg: 4,400 weeks is the average person lives.
Alex Osenenko: Yeah. 44 that’s it?
Steve Rozenberg: 4,400 weeks is the average person [inaudible 00:20:29].
Alex Osenenko: Blink of an eye baby. So yeah, if you not like take an action now. Like when opportunity came about Mynd CEO and I had a great podcast on my previous show, The Property Management podcast, and we connected really well.
We’ve sorted started talking and we will find out this company is going to crazy things. Somebody is going to figure out how to do… How to become like the South West of property management. Zappos of property-
Steve Rozenberg: There we go. I mean I don’t fly for Southwest so [crosstalk 00:20:59], but I get it. I get your point. The Google of the search engine how’s that.
Alex Osenenko: Yeah… I like to be… Yeah… Okay… So yeah… Not we work. Different, but too soon. Yes. Somebody is going to figure this out. I loved the team, I loved the direction. I loved the company. They have access to capital. Smart people. Smart boys and girls work with us. And look, Steve and I have a chance to create amazing things and my passion is to teach. I love teaching, running company is, I love it. But the creative part of directing the strategic… I guess direction of the company and teach and coach the team.
And our future customers or just listeners or just audience. So anyway, that’s why I’m passionate and so for me like just let me take a quick shortcut cause I could talk a lot about this. This was very difficult decision but, and I left a lot of people behind. I don’t necessarily feel great about everything that I’ve done, but I think, I think to me the important thing is no fear. You can’t, you’ve got to remove fear and being more deliberate about this. That’s number one. And number two, it’s a game. It’s a game. You get 4,400 weeks to play it.
Steve Rozenberg: That’s right. That’s it.
Alex Osenenko: I will make the moves that I need to make for my family. But as well as I’m not going to be 39 to 40 again.
Steve Rozenberg: Yeah. You can’t go backwards and you can’t be afraid to step off that ledge. You educate yourself and you learn how to step, but you cannot be afraid to take that step. Now you’re going to have, critics are going to have criticism. You’re going people that second guess you. You’re going to have all of that.
Alex Osenenko: Just the comments on the show. We’ll show that there’s a lot of people really unhappy with my decision. A lot of people that wished me well and very, very happy but-
Steve Rozenberg: Yeah, I think more the latter. I think a lot of people want to wish you well. I think all of us, I mean, I think, you know, there maybe there’s some people that kind of go, man, I kind of wish I did that. Deep down. I mean I think there’s a lot of that. So, I think just to kind of wrap this up, I think what we’re trying to get across as Alex and I are really going to dig deep in these shows with these investors. We’re going to ask them those questions-
Alex Osenenko: Hard questions.
Steve Rozenberg: Hard questions. We’re going to ask them some self-defining questions and we are going to have some definitely solid industry players that are here. Maybe not here in this studio, but in our studio. We, we’ve got some, some bigger pockets content. We’ve got a lot of stuff that’s really going to unpack and really asked people, how do you do it, why do you do it, how do you keep doing it and how are you getting better? And those are the kind of concepts that we’re going to go through.
Alex Osenenko: So until then, enjoy the rest of the season. We love to have you as a listener to drop us a line or comments to this show. We’re always happy to hear if you… There’s any specific thing learn what’s our Facebook group.
Steve Rozenberg: The Mastermind Real Estate Facebook group. Definitely join that. Cause there’s a lot of people in there.
Alex Osenenko: It’s a private group though. So you got to go through a little bit of a quick here interview questions. I need to ask questionnaire. We want to make sure like real people-
Steve Rozenberg: We want quality people. We don’t want people selling stuff in there. We want people to actually want to learn or want some resources to answer some real estate questions cause that, that’s what it’s about.
Alex Osenenko: And speaking of selling that one thing, you can be assured, we’re not selling anything yet. The beauty to be funded by a large company and growing and thriving company like Mynd, we don’t have to sell anything. Nobody is going to sell you crap on this show. Mark it now and enjoy the rest of the season. Thank you very much for tuning in.
Steve Rozenberg: Make sure you subscribe to our show and make sure you go to our landing page. We’re going to have shows dropping all the time on Fridays is when our shows are going to drop. Make sure you’re paying attention. Join the Facebook group and you’re going to get a lot of good content information from all different walks of life and all different types of investors. So again, make sure you subscribe it, write it on your hand, do what you got to do, but make sure that you know, our shows are coming out here.
Alex Osenenko: Write it on your hands.
Steve Rozenberg: We’ll see you guys.
Alex Osenenko: See you later.


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J Scott on the value of time

Steve Rozenberg and Alex Osenenko are joined by J Scott while in Nashville attending the Bigger Pockets Convention 2019.

J Scott is an entrepreneur, technologist, investor, and advisor. Host of the BiggerPockets Business Podcast. Author of four BiggerPockets books, including “The Book on Flipping Houses,” “The Book on Estimating Rehab Costs,” and “The Book on Negotiating Real Estate.”

Watch the Podcast Here

Full transcript


Alex Osenenko: Boys and girls, welcome to the first episode of The Myndful Investor podcast Show. Your hosts here, Alex Osenenko and-
Steve Rozenberg: Steve Rozenberg.
Alex Osenenko: Steve Rozenberg. Good buddy. This might not be episode one, this is episode zero. Why don’t you introduce the series do.
Steve Rozenberg: Sure.
Alex Osenenko: So, very quick background. Steve and I have spent the last probably decade plus in real estate in various-
Steve Rozenberg: various forms
Alex Osenenko: various forms. We don’t have to dig in too much into it, but the takeaways is we want to still provide on this episode and this very, very first, first episode is, how do you deal with fear of getting started? This is something that I think is in the way of a lot of people’s success.
Steve Rozenberg: Sure. It’s sometimes it prohibits them from success because they just don’t take action. And I don’t think it’s just real estate. I think it’s anything that they do whether it’s we’ll talk about us making decisions to you know, join Mynd and leave our businesses and join our companies together. And all the things that we’ve done. But those are big things that lack of action would not cause us to be here.
Alex Osenenko: Huge. Or there’s risk-tolerance. So let’s start unpacking this.
Steve Rozenberg: Yeah.
Alex Osenenko: So this is The Myndful Investor podcast show boys and girls. Our purpose here, our goal is to bring reality data, facts for real estate investors who are about to make an investment or can, will continue to be successful making investments, maybe pivot into different types of investments. We’re going to cover a lot of things here, but the underlying purpose for us is to make sure we provide you with data and fact driven stuff, but also in story format.
Steve Rozenberg: Yeah. And you know, the one thing I think that a lot of people have a challenge with is when they, they want to get involved in investing and they want to see and seek out how to get wealth. I think the biggest challenges is that everybody shows you kind of how to get the deal. You know, the sexy, how I can make a bunch of cash on cash return and investments. But there’s nobody there that actually shows you what do you do on day two? Once you own that deal, like you get a deal that says this is going to be a 30% cash on cash return and this is going to be these numbers. But the next thing is what do you do on day five when the tenant says, I lost my job and I’m not leaving. And so we’re going to talk to the investors in my opinion and discuss how did you guys as investors get around those kinds of things and how did you work through those problems?
Because as investing, I always tell people this is the sandbox that we play in. We’re in a sandbox where there are a lot of challenges. There’s a lot of, the good thing about real estate is there’s no rules. The bad thing about real estate is there’s no rules. So it’s, good and it’s bad. And if you know, unfortunately when you’re in this industry, there’s really nobody there. There’s no guidelines to tell you whether you’re doing right or doing wrong.
Alex Osenenko: You know what Warren buffet said, which is like stays with me forever. He’s like, he’s never, he would never make an investment in the business or company. He does not understand. Completely. He’s a smart guy? He understands a lot of things. But this is kind of the… This show’s purpose is to help you understand. Whether it’s a specific vertical you want to get into. But even before getting like super educated on a particular vertical, let’s call it, buy and hold or-
Steve Rozenberg: Flipping [crosstalk 00:00:03:53]. Or maybe
Alex Osenenko: and within buying hold, there’s single-family, there’s multi-facets-
Steve Rozenberg: Absolutely there’s so many ways.
Alex Osenenko: There’s Houston, there’s Boise, there’s Albuquerque, right?
Steve Rozenberg: It cascades down. I mean it’s, it’s such a deep cavernous column. People don’t realize. And that’s a good point cause I think a lot of people, they want to get into investing. There’s all these people that show them how to get the deal, but there’s nobody to show you how to create the wealth.
And they never, and I think that a lot of people, they don’t want to take the time to slow down, to speed up. They don’t want to take the time to educate themselves on how to actually get the wealth. They just want the wealth. And I think all of us want that, right?
We just want to make it happen. And unfortunately there’s people that have hands in your pockets, they want to make money off of you. They see the a-
Alex Osenenko: especially in this business,
Steve Rozenberg: absolutely.
Alex Osenenko: there’s a loosely say, there’s no rules-
Steve Rozenberg: there’s no rules. That’s the problem.
Alex Osenenko: You can put a syndication. You can announce syndication on this show and there will be people who will-
Steve Rozenberg: Absolutely [crosstalk 00:04:47]. absolutely. And you know the whole, like you had said, the whole goal of this show is not to talk about the glory of some of these investors that we’ve had on the show and going to have on our show-
Alex Osenenko: cause their shows like that. Everybody’s just coming in and-
Steve Rozenberg: everybody showing me how broke they are, how much money they make. I don’t want to know that. You know, we want to know and I want to know personally, like first of all, how did you get to where you are and how do you continue to drive yourself to be a better person, better?
You know, because a lot of people on the show are going to learn that a lot of the people that we talk to, the one common thread that you’re going to find with a lot of these investors is the balance of their personal life and how happy they are on a personal level, not just a fine, it’s not just a numbers thing of owning investments. They’re doing it to create a lifestyle for them and for their family. And it’s very interesting to see how people that are creating wealth and being wealthy, how they actually will continue to do it. They’ve already made the money. They don’t need the money. They’re doing it to keep the lifestyle that they want to have and the balance with their family, which is totally different than a lot of other fields and investment, industries that I’ve ever known of.
Alex Osenenko: But it’s also a gain.
Steve Rozenberg: Absolutely.
Alex Osenenko: Once you get-
Steve Rozenberg: it’s the thrill of the hunt.
Alex Osenenko: We spoke to Jay and we’re about to sort of J Scott, we’re about to announce like what this first series is going to be all about the first season I should say. But like the J Scott and I, he’s the thrill of the deal.
Steve Rozenberg: Oh yeah.
Alex Osenenko: he’s, well, he’s fine. He’s very happy like they, but like what are you going to do if you are not, if you’re not, if he is just sit there and enjoy me. I guess some people can go to the library and ski all day.
But the folks that will listen to the show, I think will find thrill of the deal. But also that, as you said, not just the deal thrill of the deal is like step one, but then it’s the day to day management.
Steve Rozenberg: Yeah. Yeah, absolutely.
Alex Osenenko: Of your portfolio. It’s-
Steve Rozenberg: It’s the all encompassing. It’s almost like you’re, you’re living not a mantra, but you’re living a lifestyle.
And we had a doctor, Dr. Steve on, right.
Alex Osenenko: Is an interesting-
Steve Rozenberg: [crosstalk 00:06:46] he’s a doctor and he owns a lot of real estate. Has no desire to quit being a doctor. Very successful. And so-
Alex Osenenko: wait, wait, no, no, no, no. He wanted to quit. That’s why the whole episode was about, don’t you remember? He actually-
Steve Rozenberg: I thought at the end he said he didn’t want to quit. So we got him there.
Alex Osenenko: But, so this is very interesting episode and look forward to that episode.
Steve Rozenberg: Yeah, that was a good episode.
Alex Osenenko: There’s the MD, like legit one of the best doctors- [crosstalk 00:07:09]
Steve Rozenberg: Put himself in medical school [crosstalk 00:07:10] on his own.
Alex Osenenko: Oh yeah, Oh yeah. Is this fascinating story. And what happens is he now wants to go real estate full time just because he loves-
Steve Rozenberg: he loves it.
Alex Osenenko: He loves the dynamic of it, he understood it. He is the kind of guy, like he went through the pilot school. He’s the kind of guy who put his mind to something and just get it done.
Steve Rozenberg: Did it.
Alex Osenenko: He’d be like a top 1%.
Steve Rozenberg: Yeah, absolutely.
Alex Osenenko: But he wants to quit MD and be… So eventually I think where we got with him, I’m not going to give too much away.
Steve Rozenberg: Don’t give too much.
Alex Osenenko: but there’s an opportunity for him to continue practicing medicine and a lot less intense way.
Steve Rozenberg: Yeah, because he doesn’t need the money. Cause he does it. He’s doing what he loves doing and money’s not a problem. And so that’s what you’re going to learn with a lot of these people. And what we’re trying to extract from the show with a lot of these guests is that you’re going to find, there’s a lot of people that have different work life balances that are very successful. Some that money is not the driver, but they are successful, but that doesn’t drive them.
And so it’s going to be a way that you as an investor or aspiring investor or experienced investor, whatever it is at your… Wherever you are in your stage of your career. You’re going to look at that and maybe do some self reflection and kind of go, Hmm, I wonder how this applies to me. I wonder if there’s some things that I could do better. I could do different. Maybe I can’t do any of these at all, but I think that you’re going to do some self reflection on that from these people that we talked to. I’m very unassuming but very successful and I think you’re going to get a lot of very good takeaways from that. Just like you and I did because you had a business, right? You owned a business, you removed yourself from that business and joined another company.
There a lot of self reflection that has to go on before you do something like that. Right?
Alex Osenenko: I mean it’s incredible. So let’s shift, let’s shift to that part of the conversation. By the way, those of you folks listening or watching, if you’re watching, thank you. You can just go into the next episode, if you want to get dig into the content and stuff. But Steve and I will talk about next is very quickly talk about how to actually get started. So I think those of you who have not, maybe you want to stick around a little bit, there’s a mental shift that has to happen. Like I didn’t use to believe in any of that Voodo sheesh, right? To me it was all, it was just like-
If you are smart enough if you work hard enough, you get there.
Steve Rozenberg: Right.
Alex Osenenko: You get there, you work hard enough. You’re smart enough, you’ll get there.
Steve Rozenberg: Yeah. It’s not always the case.
Alex Osenenko: No.
Steve Rozenberg: I know a lot of smart people that make [crosstalk 00:09:31] no money and they’re not happy either.
Alex Osenenko: It’s not even about money. Right? It’s like, you know what the doctor wanted to… Dr. Steve wanted to make a move. I think, I mean I clearly remember there’s a lot of administration stuff.
With his profession [crosstalk 00:09:46] that he just doesn’t… With real estate frees him up to do what he loves. With doctoring, he wants to cure people. He loves that.
Steve Rozenberg: He loves it. He loves… He was saying, he loved being there when a baby is born and even when somebody passes on, he feels like he’s a part of that. It’s something almost holistic. He said that you’re a part of this whole cycle of life.
But if you’re just sitting there trying to get a paycheck. You’re not even paying attention to that part of the job. Which is probably why you even got involved in being a doctor in the first place. Or you know, Jay Scott, right? He’s, got race horses, right? He spends so much time with his family. Brandon Turner, you’ve got all these people that we know that are just so focused on doing what they want to do. They can enjoy their family because they’ve taken those, I don’t even want to say calculated risks, but they’ve been so smart and understanding what their next steps are because they’ve watched shows like this. They’ve educated themselves. Sure, they’ve made mistakes. We’re all going to make mistakes.
You know, it’s not a failure unless you learn from it. If you learn from it, then it’s a lesson, right? I mean, but it’s just one of those things. And I think what we want to unpack in these shows is why these people are being successful and how you are just like these people. And you can be successful too. You’ve just maybe have to change your mindset and think a little bit differently. Would you agree?
Alex Osenenko: Yeah, I would agree and the passion plays into it. I’m just wondering like I want to first step this out or point 0.01 episode. I want to introduce our behind the scenes guy. Dan, I’m just curious, Dan, are you passionate about the video? I mean, you out there fill me-
Steve Rozenberg: You look passionate.
Alex Osenenko: You sipping on a Corona. You look a little passionate there Dan. Anyways, so Dan is our… You’ll see the quality of what we produced.
Steve Rozenberg: Yes, absolutely.
Alex Osenenko: That will be his top-notch quality.
Steve Rozenberg: It’s going to be top-notch quality. It’s going be the level of people we have, the thought processes we have, the access to educational levels that we’re going to be able to bring in. I mean, I think it’s going to be bar none, one of the best, if not the best shows that are out there with current constant education at a ground level. I think.
Alex Osenenko: Let’s talk about this. Let’s… we promise this, let’s talk about this. Let’s talk about your move that you made.
Steve Rozenberg: Why am I first.
Alex Osenenko: I don’t know cause I’m the one speaking.
Steve Rozenberg: Okay, fair enough you be first.
Alex Osenenko: I’m the one asking the question. And so you’ve made a significant move. So I’ll give a quick pre-story.
You’ve been an investor and I’m going to move out the chair for a second cause I want to grab your book. Oh, we’re using it as a coaster.
Steve Rozenberg: Yeah, They threw it on the floor. [crosstalk 00:12:16]. It was on the way and they threw it on the floor.
Alex Osenenko: So there was kind of-
Steve Rozenberg: A lot of respect-
Alex Osenenko: [crosstalk 00:12:21] to throw it in my face.
Steve Rozenberg: for my workings.
Alex Osenenko: Hey you sign my book, we’re not selling any books.
But the idea is, he was a failed investor, Steve, because it looked good on paper and they kept on buying it and when it didn’t work, you know what was a good idea?
Steve Rozenberg: Buy more of them. Buy more, why not?
Alex Osenenko: Buy more and so from there he said he couldn’t manage it. So started a management company, very successful Gouda company to 900 properties that can manage.
Steve Rozenberg: 900 doors. Yeah.
Alex Osenenko: In Houston and all of a sudden the things like he’s one of the fastest growing companies in Texas.
Got like 500s of five-star Google reviews. I mean, absolutely dominating. And guess what happened? Steve decided to make a move and partner with mine. So in other words, essentially sell his company to mine. In order for a chance to join and become host of this show. That was a big deal, wasn’t it?
Steve Rozenberg: Absolutely. It’s to me again… I’ve always learned in my life and this is something I think a lot of people can take away. What gets you here is not going to get you there. You and I have had these conversations and I think life and someone told this to me one time and it really resonated with me that life is like a book and you have chapters and there’s a chapter that could be a great chapter, but at some point that chapter ends and when that chapter ends, a new chapter begins and you don’t go back to that chapter again. And the company, Pete Neubig and I built and the team that we had. It was a great chapter and it got us to the next chapter and the next chapter is going to be better chapter.
And that’ll be a chapter after that. And I think that’s life. And I think that a lot of people never flip that page and they never move on to the next chapter. And maybe they slide backwards. And so I think the biggest challenge, the thing that I learned was this is just part of the growth cycle. It’s like leaving high school, right? We all know friends in high school that never left high school. They’re still, they’re mentally talking about the days of high school. They’ve never left there. And so a lot of people, same thing in business, some people just do not want to leave the comfort zone of their business. And look, you read these books, you do the audios and you hear like, you know what, you have to be comfortable being uncomfortable and that’s all well and good until you really are uncomfortable.
And now you’ve got, it’s like the rubber meets the road.
Alex Osenenko: That’s growth, that’s when the growth happens
Steve Rozenberg: It’s growth. You have to be okay. And at some point you’ve got to say, you know what? I’m going to trust the process. I’m going to trust my education. I’m going to trust everything I’m doing. I’m going to shut this chapter and I’m going to move onto the next. And that, that’s kind of what I did. I just… I trusted the process. I trusted you. The people at mind, everybody that was involved in helping us come over. I trusted it and I said, you know what? Based on educated calculated decisions based on everything that I think that mind will be able to provide for me and where the future is with mind. It was a no brainer. But there’s still that risk. You’re leaving your own company that’s doing fine. That’s very successful.
Alex Osenenko: No brainer. People say that in a rear view mirror, it’s no brainer. When you in the-
Steve Rozenberg: When you’re in the turn, it’s not as easy.
Alex Osenenko: Remember we talked about your role, so now you’re VP of investor education. We’ve talked about your role. We had a lot of back and forth. Those emotional moments. It’s difficult guys and girls it’s definitely difficult.
Steve Rozenberg: Not easy.
Alex Osenenko: Can I unpack something you said?
Steve Rozenberg: Sure.
Alex Osenenko: You said there’s a chapter. I love that, by the way. You always teach me new things. Oh, it’s mine now.
Steve Rozenberg: Dan quote that.
Alex Osenenko: So it chapters, how do you know this is, I sometimes have problems with this. How do you know when the chapter is coming to an end? Is it when you see a new opportunity, and it’s like, Whoa, you know, it’s it. Like how do you know when the chapters ending, how not to hold on for too long [inaudible 00:15:58].
Steve Rozenberg: You know, I think that’s different for everybody, but I think sometimes the chapter closes already and you don’t realize it. Like your chapter… you may have a chapter that’s already closed and you are just not accepting that it’s closed. Sometimes when we’re… When you’re in the heat of battle and you’re kind of in the weeds. And again, this chapter this… The books over the book, the movies over, right? The, the credits are rolling and you’re still sitting there not leaving the movie theater. Right. And so sometimes we may not want to it accept that that chapter is over in our life.
Alex Osenenko: Do you have an example, by any chance, can you think of an example of someone you know. You don’t have to name names. Or maybe yourself where you sort of overstayed your welcome per se? I mean-
Steve Rozenberg: I never overstayed my welcome.
Alex Osenenko: You wheeled in a bag today, your airline bag into my house
Steve Rozenberg: Yes, yes, yes to my house. And he said, are you staying here tonight?
Alex Osenenko: You did not tell me anything. Maybe we’ll cover that. But is there a chapter?
Steve Rozenberg: I don’t know that I have a chapter, I mean maybe I do that I don’t know about. But I think at… My thought… I’ve learned… I’ll give you a perfect example where I made a decision, a lot of indicators. So you know my, my being an airline pilot, right? So that chapter 9/11 that chapter ended, right? So for me now, I still stayed as an airline pilot, but after 9/11 there was a new chapter I didn’t want to… A lot of people did not want to accept it. So what did a lot of people do? They went down to South America to fly. They went over to Asia and they flew airplanes at a quarter of the income that you are making as a U S airline pilot. Why? Because they didn’t want to accept that things were changed and they didn’t make the decision to flip the page and start a new chapter.
I said, you know what, I love being a pilot. However, I’m not going to let this dictate me anymore and what I’m going to do is I’m going to take control of my future and start learning about real estate. A lot of other people said, I’m going to Korea. I’ll be there for three years flying small planes until this thing weeds itself out. To me, that’s not accepting that the chapter has ended. So that’s the best way I could describe how a chapter can change and you not accepting that it’s changed. Because all the indicators were that the airline industry as a whole will never be the same again.
Alex Osenenko: That’s very good.
Steve Rozenberg: So that, that’s how I would basically essentially say that’s how you know it, but enough about me. Let’s talk about you Alex.
Alex Osenenko: Dude, I can’t believe like, I can’t believe how like we’ve done podcasts in the past, but I can’t believe like how this is connected because I was just going to say, Dan, stop the recording for a second. Steve, why don’t you ask me about me now? We only have 20 minutes to this 0.01 episode. We want to be respectful to the audience. They don’t want… us yammer for 20 minutes. They want to get into the meat of what this is all about. Which is top-notch education validated with a couple of guys .
Steve Rozenberg: So based on this conversation, we’re talking about people making a decision and moving on and things happening, right? So you had a company, right? You had a very successful company, still do, still have the company and you made a decision to basically essentially remove yourself and join mine. Right? Essentially he’s my boss, so I got to be somewhat nice to him, I guess. But you know, basically you, you made a decision, right? And calculated or not the chapter ended, right? Some chapter ended and again, it’s not just you, right? You’ve got a wife, you’ve got children, there’s a whole trail behind you that are affected. There’s a ripple effect, right.
Alex Osenenko: There’s also people in the current, in the company I left
Steve Rozenberg: in the company left. Yeah. The allegiance going, Hey, where’s Alex? Alex, you know, and so there’s, maybe a guilt factor at some level to go, man, how do I do this? Am I doing the right thing? Am I being selfish? Am I being, am I doing the right thing for my family? How did you unpack all that and go through those iterations mentally?
Alex Osenenko: Definitely a lot of guilt. Definitely a lot of sort of second guessing yourself. That’s, I think that’s all normal. But like you will laugh. Maybe a stoicism is something that I am sort of investing in right now. My sort of mental resources and Tim Ferriss is my favorite podcaster and he’s big. He wrote this book, the Towel of Seneca and anyway, it’s very interesting philosophy on how to sort of deal with change. But the way I think about this is, one life. I think I learned it from you. Like you only have like 4,900 whatever however many-
Steve Rozenberg: 4,400 weeks is the average person lives.
Alex Osenenko: Yeah. 44 that’s it?
Steve Rozenberg: 4,400 weeks is the average person [inaudible 00:20:29].
Alex Osenenko: Blink of an eye baby. So yeah, if you not like take an action now. Like when opportunity came about Mynd CEO and I had a great podcast on my previous show, The Property Management podcast, and we connected really well.
We’ve sorted started talking and we will find out this company is going to crazy things. Somebody is going to figure out how to do… How to become like the South West of property management. Zappos of property-
Steve Rozenberg: There we go. I mean I don’t fly for Southwest so [crosstalk 00:20:59], but I get it. I get your point. The Google of the search engine how’s that.
Alex Osenenko: Yeah… I like to be… Yeah… Okay… So yeah… Not we work. Different, but too soon. Yes. Somebody is going to figure this out. I loved the team, I loved the direction. I loved the company. They have access to capital. Smart people. Smart boys and girls work with us. And look, Steve and I have a chance to create amazing things and my passion is to teach. I love teaching, running company is, I love it. But the creative part of directing the strategic… I guess direction of the company and teach and coach the team.
And our future customers or just listeners or just audience. So anyway, that’s why I’m passionate and so for me like just let me take a quick shortcut cause I could talk a lot about this. This was very difficult decision but, and I left a lot of people behind. I don’t necessarily feel great about everything that I’ve done, but I think, I think to me the important thing is no fear. You can’t, you’ve got to remove fear and being more deliberate about this. That’s number one. And number two, it’s a game. It’s a game. You get 4,400 weeks to play it.
Steve Rozenberg: That’s right. That’s it.
Alex Osenenko: I will make the moves that I need to make for my family. But as well as I’m not going to be 39 to 40 again.
Steve Rozenberg: Yeah. You can’t go backwards and you can’t be afraid to step off that ledge. You educate yourself and you learn how to step, but you cannot be afraid to take that step. Now you’re going to have, critics are going to have criticism. You’re going people that second guess you. You’re going to have all of that.
Alex Osenenko: Just the comments on the show. We’ll show that there’s a lot of people really unhappy with my decision. A lot of people that wished me well and very, very happy but-
Steve Rozenberg: Yeah, I think more the latter. I think a lot of people want to wish you well. I think all of us, I mean, I think, you know, there maybe there’s some people that kind of go, man, I kind of wish I did that. Deep down. I mean I think there’s a lot of that. So, I think just to kind of wrap this up, I think what we’re trying to get across as Alex and I are really going to dig deep in these shows with these investors. We’re going to ask them those questions-
Alex Osenenko: Hard questions.
Steve Rozenberg: Hard questions. We’re going to ask them some self-defining questions and we are going to have some definitely solid industry players that are here. Maybe not here in this studio, but in our studio. We, we’ve got some, some bigger pockets content. We’ve got a lot of stuff that’s really going to unpack and really asked people, how do you do it, why do you do it, how do you keep doing it and how are you getting better? And those are the kind of concepts that we’re going to go through.
Alex Osenenko: So until then, enjoy the rest of the season. We love to have you as a listener to drop us a line or comments to this show. We’re always happy to hear if you… There’s any specific thing learn what’s our Facebook group.
Steve Rozenberg: The Mastermind Real Estate Facebook group. Definitely join that. Cause there’s a lot of people in there.
Alex Osenenko: It’s a private group though. So you got to go through a little bit of a quick here interview questions. I need to ask questionnaire. We want to make sure like real people-
Steve Rozenberg: We want quality people. We don’t want people selling stuff in there. We want people to actually want to learn or want some resources to answer some real estate questions cause that, that’s what it’s about.
Alex Osenenko: And speaking of selling that one thing, you can be assured, we’re not selling anything yet. The beauty to be funded by a large company and growing and thriving company like Mynd, we don’t have to sell anything. Nobody is going to sell you crap on this show. Mark it now and enjoy the rest of the season. Thank you very much for tuning in.
Steve Rozenberg: Make sure you subscribe to our show and make sure you go to our landing page. We’re going to have shows dropping all the time on Fridays is when our shows are going to drop. Make sure you’re paying attention. Join the Facebook group and you’re going to get a lot of good content information from all different walks of life and all different types of investors. So again, make sure you subscribe it, write it on your hand, do what you got to do, but make sure that you know, our shows are coming out here.
Alex Osenenko: Write it on your hands.
Steve Rozenberg: We’ll see you guys.
Alex Osenenko: See you late

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Fitting Work Around Life with Tarl and Grace Yarber

Tarl and Grace Yarber discuss putting their life goals first with Steve and Alex in Nashville attending the Bigger Pockets Convention 2019.

Fixated Real Estate (Tarl and Grace) is a Seattle, WA based real estate investment company specializing in volume fix and flip, buy and hold, and BRRR single-family properties throughout the Pacific Northwest.

Watch the Podcast Here

Full transciprt

Alex Osenenko: Boys and girls, welcome to another episode of the Myndful Investor Podcast Show, Steve and Alex here. Very excited. On the show, we have a phenomenal guests line up. We went to Nashville.

Steve Rozenberg: Yeah, BiggerPockets Convention.Alex Osenenko: BiggerPockets Conference. Those of you… If you are on Investors World and you don’t know who BiggerPockets is you’re not really serious.
Steve Rozenberg: You’re not in Investors World.
Alex Osenenko: Yeah, you’re not serious about it.
Steve Rozenberg: Yeah, not at all.
Alex Osenenko: BiggerPockets is a community. Enough said, everybody should know that name. Millions of people do in fact. But we had the interview with your friends.
Steve Rozenberg: Yes, Tarl and Grace Yarber.
Alex Osenenko: One of the key takeaways I had from the interview experience was how to operate as husband and wife. How do we separate the work, how to be passionate, enjoy the work, but don’t… Find a way not to butt heads, find a way not to dominate the other person. It’s real true partnership. To me that was fascinating because my wife and I worked together in a previous company and we still may work together. We are in a similar business, right?
Steve Rozenberg: Yeah.
Alex Osenenko: In marketing, broadcasting and stuff like that.
Steve Rozenberg: I think what you’re going to take away from this is, number one, how they can assign-
Alex Osenenko: That’s number two by the way. I know, I just gave number one.
Steve Rozenberg: Okay, so number two. But mine’s number one for me. You’re going to learn how they, as Alex said, how they operate together on work, on their strengths. But more importantly, the thing that you’re really going to take away from this is the fact that they have their life first and they have their business wrap around their life. Most of us do it the other way around. They’re very cognizant of that. They take over a hundred days a year of vacation, they’re very, very successful in the real estate industry, they have fixated on real estate group, and they have a huge events company. They do these huge expos on top of everything else. I mean, they’re like the dynamic couple man.
Alex Osenenko: Without further ado, let’s get into the show. Here we go.
Steve Rozenberg: All right, we’re here at BiggerPockets and one of the best things about coming to these conferences is you get to hang out with some amazing like minded people, and I get to talk to my very good friends that I’ve known for years. We talk real estate, we all know real estate, we’re involved in it. Tarl and Grace had been a… They’ve been a huge impact for me, we’ve been great friends. I’ve spoken at their conferences in the Pacific Northwest. Very good friends. Guys, thanks for being here today. I just enjoy every time the energy of you guys. It’s really cool. I really appreciate you guys always blessing me with your day. I guess I…
Tarl Yarber: Well, it’s almost like we’re the best thing that ever happened to you.
Steve Rozenberg: You are the best thing that ever happened to me.
Alex Osenenko: As for me, I don’t know Tarl and Grace at all, but I’ve heard a lot of good things about them. As our audience, they’re probably sitting on the edges of their chairs now figuring out, “What is this episode going to be about?” What it’s going to be about is this. You guys seem to be a power couple, they say, but you work together. This is interesting. You probably had jobs in the past, you quit those jobs and you decided to do business, decided to do it together. You’re doing it well and you seem like at least tolerate each other. Which is obviously-
Steve Rozenberg: At least for this episode.
Alex Osenenko: No, but you seem like you’re really into each other, which is awesome. So maybe other couples out there can learn from you. We want to sort of explore that out.
Steve Rozenberg: Let’s just start. You guys are in the Seattle area, Pacific Northwest, and you guys have different avenues that you do, right?
Tarl Yarber: Mm-hmm (affirmative).
Steve Rozenberg: You guys do… Well, are you doing the flipping and rehabbing or what do you guys actually doing now at this point?
Tarl Yarber: Right now we’re still focused on single family, fixed and flipped with an emphasis on keeping them at the end. We do a lot of what’s the birth strategy. Buy it, rehab it, rent it, refinance it, repeat. We haven’t changed much in our business model over the years. We’ve done little close to 600 flips so far, but at the end of the day, over the last two years, we’ve been keeping more and more of them. It’s basically, instead of selling it at the end, we just refinance it and keep it as a rental. It’s a different strategy for us, but we’re actually doing less volume than ever because we decided to live a more lifestyle business. So we travel a lot for the last two years.
Steve Rozenberg: Yeah. You guys are everywhere. But before we talk about the lifestyle, what was the reason that you guys went from the selling to the keeping it holding?
Tarl Yarber: Well, ultimately, we both have our different reasons. But ultimately I was working a ton running the company, Grace was a C level at a tech company and she was working with them. We just got to a point in our lives where we were just going different paths and all we… If you ever asked us what we wanted in our lives at that moment, it was just to be together as much as possible. I, at that point, realized I was doing real estate for no other reason just to do real estate and just make money. I’m like, “What can we do to change our lives? What can we do to change our path so we can actually live a happy life, where we actually enjoy each other’s company and go be together all the time?” We sat down over the course of a few weekends and we figured out what we really wanted out of life. It wasn’t much the financial side, it was more the experiences and life side. We made a plan then for…
At that point, Grace to quit her job and then… Well, it was only like, two weeks later. She went full-time in the business but with an emphasis that we would actually reduce her volume, go straight passive as much as possible and then go live our life every day more in the travel aspect and fun aspect. I mean, you don’t need to make a lot of money to be able to live the life that you really want for most people.
Steve Rozenberg: Sure.
Grace Yarber: If I may, I thought if I can add to Tarl’s thing. We really have that why reasoning to… Some investors that I began networking when I came to real estate about four years ago when Tarl and I, we started getting together as a couple. A lot of people, I think, have association saying like, “Hey, W2 job is bad.” Investments are good. I think I want to emphasize this. Whatever that is, your end goal, whatever where you’re headed, I think that’s what important is for couple or an individual to emphasize what that is, right?
Steve Rozenberg: Yeah.
Grace Yarber: Versus being like, oh no. You have to quit W2 job in order to be happy and to really have that end game. I think what it was to us in our relationship, it was like a little bit delayed because I was actually happy with what I did. I was challenged at the job because I get bored so fast in any activity that I do. I was working for a software company and I was actually enjoying. Then people used to ask me, “When are you quitting?” I’m like, “Why would you would I want to quit?” They say, “Because your wife Tarl Yarber. You guys do investments.”
Steve Rozenberg: You’re the wife of.
Grace Yarber: Yes. But I can still part-time manage our rentals while I’m being very fulfilled in my full-time job. But then it was like a big aha moment and be like, “Okay.” We merged our… Like two separate people together as a couple in marriage that all we want is just to be together.
Steve Rozenberg: Right.
Grace Yarber: That was the ultimate an answer to us. We’re like, “Wait.” Okay, even I enjoy my life as in W2 job, plus the investments, but the wake up call was like life is yucky and sticking, right? Will we be happy a year or two years from now if our day-to-day life how it is today. That was a thing, that ticking point. I’m like, “As much as happy as I am, my top priority is to be together.” I said, “We have to plan exit strategy how do I get out of my job.”
Steve Rozenberg: Wow.
Grace Yarber: That’s my [inaudible 00:07:41].
Tarl Yarber: And everyday since then we’ve been together. Everyday except when you went to Europe for three weeks with your mom.
Grace Yarber: That’s right.
Tarl Yarber: And I went to Mexico with Buddy and [Stach 00:07:49]. But other than that, for the last two years we’ve been together every day.
Alex Osenenko: That is fascinating. You’re setting as a company would set these large goals, these five year goals. As a family you got together. I just listened recently to one of Tim Ferriss’, I’m a big fan of Tim Ferriss and his podcast. Yet I can’t remember… I’m terrible with names. But the guest was talking about this family planning same as business, same level what you guys just did. That fascinated me. You’ve done this. Takeaway’s number one, sit down with your significant other and decide what matters to you most. It could be the W2 job. Could be, or it could… You just decide to do-
Grace Yarber: Or it could be a business partner. It could be anyone that you work with. Like, what is your end game? What is important to you?
Tarl Yarber: The key factor for us was a moment at the end of 2017, where I’d come to a crossroads on a lot of our business. I was burning out and Grace was… Grace and I wanted to be more together. But it wasn’t until a buddy of ours named Stach, that we really, really, really respect, very, very successful. He had transformed his entire life to be more of a lifestyle as well, but he had said something like… You hear statements in personal development, business and if you’re not ready for that statement, you just kind of pass on with your life. Whatever rate you don’t hear it.
Grace Yarber: So true.
Tarl Yarber: It was at a moment in October, 2017, where he’s like, “The problem is most people plan out their entire business, design their entire business and have a plan for that and then whatever’s left over, they put their life into that.” So they plan their life around their business versus-
Alex Osenenko: Sounds familiar.
Steve Rozenberg: Yeah, think we all do that.
Tarl Yarber: He’s like, “It’s so easy.” He was like, “Why don’t you plan out what you want in your life first and figure out what do you want your life to look like and when do you want your life to be, and then go plan that out and whatever’s left over, make your business fit that.” And I’m like [crosstalk 00:09:43].
Alex Osenenko: Profiling.
Steve Rozenberg: Yeah, it is.
Tarl Yarber: Make your business fit the life that you want? I’m like-
Steve Rozenberg: Is that possible?
Tarl Yarber: As soon as he said it, I’m like, “I could do that. We could easily do that actually. Why aren’t we doing that?” That’s what lead to us sitting down over a few weekends.
Grace Yarber: That was… Yeah.
Tarl Yarber: We designed everything we wanted and now we actually live like… There’s a bit of times where, be careful what you ask for too because we planned out exactly what we wanted and then, I remember four, five months later, we lived everything we wrote out and we were bitching about it. Because we were like, “We got this to do. We have to… Oh my God, we have to do this now. Now we have to go there, we have to do that.”
Grace Yarber: As in we have to-
Tarl Yarber: I’m like, “Wait a second.”
Alex Osenenko: This is not a to-do-list?
Tarl Yarber: Yeah.
Steve Rozenberg: What is the point?
Tarl Yarber: But this is exactly what we wanted.
Grace Yarber: It’s like coming to for actions. There was the recognition and awareness, that mindset.
Tarl Yarber: We started laughing about it too. We’re like, “All right, we need to chill out.” Let this [inaudible 00:10:31].
Grace Yarber: To me, that to embraces and be much happier even though we were having so many things in business successfully happening. Everything we wrote on [inaudible 00:10:40].
Steve Rozenberg: Now you guys, before you we’re saying, you guys traveled so much that you’re kind of tired of traveling, right?
Tarl Yarber: Mm-hmm (affirmative).
Grace Yarber: That’s right.
Steve Rozenberg: Pair that back a little bit.
Tarl Yarber: Over the last two years, last year, 2018, we traveled 102 days, pretty much all for fun. Then this year we’re on track for… We’re at 89 right now. We’ll be at 127 by the end of the year. Based on-
Alex Osenenko: 127 what?
Tarl Yarber: Days.
Steve Rozenberg: Days.
Alex Osenenko: Oh wow. Okay, days a year.
Tarl Yarber: Days of the year.
Steve Rozenberg: Let me ask you this, how do you guys… For people that are married and they want to get to where you guys are at, what advice would you give a married couple that, let’s say they’re both W2’s and they’re like, “Man, I want to start my own business.” Whether it’s real estate or not. Real estate is just the product of what you guys are doing, but there’s still the marriage of you guys coming together and having that conversation. Where do couples even have that initial conversation to realize that they’ve got to take a step further?
Grace Yarber: I think the most important thing is like, a lot of people get attracted by the highlights, by the HD TV. That’s how you flip the house fast, right?
Steve Rozenberg: Yes.
Grace Yarber: It’s really just being true to yourself and allowing that space to really think for yourself and then bring in that significant other. Whether it’s your business partners or a spouse, in our case.
Steve Rozenberg: Sure.
Grace Yarber: I think that’s super, super important. We even met one couple in Seattle, very successful jobs, but they were just very attracted to investments and they have a capital. They want to be investors but then you start challenging them. Be like, “You guys are doing so well what you already do. What is your why?
Steve Rozenberg: Right.
Grace Yarber: Why you even want to do that, right?
Steve Rozenberg: Mm-hmm (affirmative).
Grace Yarber: Do you want to be a passive investor? Do you want to give your money to syndication? It could be any of the exit strategy. I think that’s a number one thing. Then, it’s really finding out, do both of you need to be in a business, right?
Steve Rozenberg: Sure.
Grace Yarber: It could be just one really taking charge and just leading the way.
Tarl Yarber: And what are your strengths?
Grace Yarber: Strengths and weaknesses.
Tarl Yarber: Absolutely. The big thing for us, what makes us work well as a couple is that we have very clearly defined lanes. When Grace was going to quit her job, she was just like, “I am not coming to work for you. It was business.”
Grace Yarber: Oh, before we planned on the exit strategy I’m like, “I’m not leaving my job.” Because I’ve seen that and I think a lot of couples can relate to that.
Steve Rozenberg: Right, then it gets to resentment and that’s, yeah.
Grace Yarber: Yeah. My marriage is my number one thing, I don’t want to create a challenge so that we are no longer even friends, right?
Steve Rozenberg: Yeah.
Tarl Yarber: Mm-hmm (affirmative).
Grace Yarber: That was a big, big wake up.
Tarl Yarber: I’m very, very, very fortunate to have a wife like Grace that can sit there and like… It’s challenging for some people to turn off the work mode and be husband and wife mode. For whatever reason I’m able to switch like, “Oh no, you’re my wife now. Now you’re my business partner. Now you’re my wife, now you’re my business partner.” Grace is very good at that too.
Grace Yarber: I’m getting better.
Tarl Yarber: She’s getting better everyday.
Grace Yarber: I’m more business-like, I get so driven. I’m like, “Oh, let’s just go and do this too.” I get very fired up.
Tarl Yarber: Yeah, we’re able to sit there and talk to each other and be like, “Hey, can we be husband and wife right now?”
Alex Osenenko: Guys, I mean, this is fantastic. This is, I think, a very advanced kind of tactics and strategies for families, or for husband and wife, for couples to plan. I want to get to the grind. I want to understand how you got here. This is a privileged spot to be able to plan these kinds of things and have you exited the C level job and probably… It’s not like you were making minimum wage. I mean, there was a… We have to replace that income or at least decide to live with less of an income. I want to understand the grind. Guys, give me some of the stuff here you grind through to get to that point.
Tarl Yarber: Okay. How about flipping 600 houses [crosstalk 00:14:23]?
Alex Osenenko: I have a question follow up, flipping 600 houses. Yeah, that’s a lot of work. How big is your team?
Tarl Yarber: Oh, right now?
Alex Osenenko: Well let’s go… Yeah, let’s go [crosstalk 00:14:33] progressively.
Steve Rozenberg: Let’s talk about how we got there then they pair down to be more strategic.
Tarl Yarber: The story though, truth be told, is like… Most of the story though is my story coming into it. Then Grace and I, when we got together, she met me when I was in the thick of a lot of stuff. Then she already had… She was a very independent woman. She already had her career. She’s like, “That’s great.” I’m like, “Cool, I got my thing, you got your thing.”
Grace Yarber: I’m like, “You do Tarl, I do me and then we’re very happy.” But then it was like the number of hours limited every day.
Tarl Yarber: She has her story when it comes to getting into real estate. But it started with… Basically, in a nutshell, there’s a lot of story here, but the short story portion of it is full-time in 2012 in real estate. I never did just my first flip, there was never that story. It was like our first eight and six or whatever. It just went. I was a partner in a service area management company for Fannie Mae based out of Phoenix, and I was living in Washington. I started running the Washington area for them. We started just doing a bunch of REO, REO fixers for Fannie Mae so that they would get them ready for listings for the REO agents during… Just tons of REOs at every grade. We started opening up in multiple states and we got to a point where we’re in seven states and I was flying around the entire US just opening up these markets. Because I wasn’t married, I didn’t have kids and I was really, really good at networking. I can fly into an area and open up.
Grace Yarber: You’re still good.
Tarl Yarber: Yeah, still good.
Steve Rozenberg: Still good.
Grace Yarber: He’s like a [inaudible 00:16:03].
Steve Rozenberg: Yeah.
Tarl Yarber: We were building all these relationships with all of the top real estate brokers in all the different states for REO. All the Fannie Mae, Bank of America, Wells Fargo, all the different ones out there. We were [inaudible 00:16:16] when and we were building all these relationships. Then we had all these contractors that we would have anywhere. In any state, we’d have 20 or 30 general contractors that were underneath our license to be able to work with Fannie Mae. We had all these boots on the ground, we had all these systems and then we just, me and my partners at the time, said, “Why aren’t we flipping any houses?”Then we just started buying houses but we didn’t understand how to raise capital. So we are giving away 80% of the equity to people and splitting it three ways, the 20% three ways thinking it’s cool. Because money was hard to get. We just kind of stumbled to this whole system of just buying all these properties in different states and that grew and grew and grew.
Then in 2014 in February we had a business partnership fallout. Where the other two business partners that were in the new entity, which was for flipping houses, pretty much, for lack of a better word, backstabbed me. It felt like two brothers that I’m like, “I’m going to go to war with forever.”
Steve Rozenberg: Yes.
Tarl Yarber: I was the naïve one apparently. It just… It rocked my world big time and it made me to where I’d never want to do real estate again. We had already done a hundreds of properties by them. It is a very short, condensed period of time. We would just go in. In 2014, February, that business partnership collapsed with me leaving it. I said I’ll never do real estate again. Grace and I were together then, she saw me that day when that happened, when I got… When I figured it out and I told the guys I’m out. I just didn’t know what to do with myself, so I went-
Grace Yarber: The worst of all was seeing how he was crushed.
Tarl Yarber: Oh, it was horrible. Yeah, this is like brothers.
Steve Rozenberg: Yeah, sure.
Tarl Yarber: I had to go on IKEA that night and just bought a bunch of Ikea furniture [inaudible 00:17:48].
Alex Osenenko: I think so.
Tarl Yarber: I didn’t know what to do with myself.
Steve Rozenberg: That’s the best thing and they [crosstalk 00:17:51].
Tarl Yarber: Grace comes over and she sees a bunch of drawers and things together.
Grace Yarber: Furniture.
Steve Rozenberg: Drawers and certain things together.
Tarl Yarber: I’m just fixing stuff, drinking and stuff.
Steve Rozenberg: I think that’s about the time I met you, right? Is that… 2015, I think, is when you and I met.
Tarl Yarber: Yeah, this is 2014.
Steve Rozenberg: It was after.
Tarl Yarber: I was out, I was never going to real estate.
Steve Rozenberg: Oh, okay.
Tarl Yarber: Six months later after traveling, drinking and playing video games, I got sucked back into real estate by some buddies, and that led to us creating Fixated Real Estate. I started on my own, but I was just helping buddies out with some stuff. Then eventually, some opportunities came out to where we just started buying a lot more properties internally for my own company, then Fixated Real Estate got created. For the first time in my life, I did one thing and one thing only in 2015, and that was flip houses. All the other years prior, I always had multiple businesses going on, multiple consulting things, multiple like ventures. I was successful, but I didn’t achieve great success until I only focused on one niche. And that was Flip. Then I got really good at that and now we’re adding onto it and it just progressed. When I get bored I start new things. Like, we started an events business too and [inaudible 00:18:55].
Steve Rozenberg: But all the things that you’re doing are very good. Because I think because you, I’m guessing, because you focus on that one thing that you’re doing at the time, right?
Tarl Yarber: Yeah.
Grace Yarber: I think the lesson is really like, we as humans if something happens, even the moments when he was crushed and the partnership falls, he was like, “Oh shit, this is so bad.” But I think it’s like as a human, sometimes it’s good to reflect. There’s a very famous video, it’s called Good, by Jocko Willink, it’s like what is good… Just YouTube it.
Tarl Yarber: Yeah, what bad thing that happened to you that you can actually look at as a good thing.
Grace Yarber: That you can turn into what is good out of it, right? It’s like a… I think it’s a big lesson that we always… Anything that’s unpleasant happens in our lives.
Steve Rozenberg: Sure.
Grace Yarber: Personal business, we always switch around. It’s like, “What do we get good out of it?”
Steve Rozenberg: Right. What lesson.
Grace Yarber: Yeah, but surprisingly how our mind then begins focusing on good stuff.
Steve Rozenberg: Right.
Grace Yarber: Because we can be in the rabbit hole, in the circles like, “Oh, my life sucks. Oh, it’s so bad.” Like under depression, all those things come up and, “Hey, investment world, investor life is not always a…”
Steve Rozenberg: Yeah, it’s a sand box of pain. Yeah, it’s [crosstalk 00:20:01].
Alex Osenenko: This is what a stoicism… I’ve been learning stoicism.
Grace Yarber: Stoicism is huge, yeah.
Alex Osenenko: It’s an amazing set of technique or…
Grace Yarber: And raise the good, there’s so much…
Tarl Yarber: Or even…
Alex Osenenko: Just mental model. Like it’s not happening to you.
Tarl Yarber: Except through you.
Alex Osenenko: Right. You just need to be outside of it and just sort of explore it as you would outside of your own body and there’s a lot of points to the philosophy. But it helped me through some hard things. It certainly did. This is something that I think folks can look up. I mean, again, Tim Ferris is big on stoicism.
Grace Yarber: Stoicism.
Alex Osenenko: He has got this book that is given away for free, that people can read and will cite it in, show notes. But…
Tarl Yarber: I just want to emphasis one thing on what you just said. The best thing that ever happened to me want me was my partnership falling out, right?
Alex Osenenko: Ah, interesting.
Steve Rozenberg: Yeah.
Grace Yarber: That’s my point, yeah.
Steve Rozenberg: Later, that same partnership, the guys that got left it to they’re destitute now. I mean, they messed their entire one… One got into-
Grace Yarber: Drugs.
Steve Rozenberg: Major drugs and
Tarl Yarber: One got into a major drugs and prostitutes, not that he was prosecuted-
Steve Rozenberg: Now it got tough.
Grace Yarber: Not that you know of, right.
Tarl Yarber: Bad, bad drugs, the other person’s supervisor and he just ran the company to the ground. The best thing that happened I would have never created, but we had, if it wasn’t for them backstabbing me. You never know.
Alex Osenenko: They would always hold you back.
Steve Rozenberg: Yeah.
Alex Osenenko: What’s the premise behind fixated real estate and what’s the name? Where does the name come from?
Grace Yarber: That’s funny.
Tarl Yarber: Name came from a random word generator because I just needed an entity to be able to run some of our profit through from our other business. The sound like fixated or whatever that sounds cool. That’s pretty much all came from and then it just adapted to its thing. Now we have a meet up that we run called Fixated On Real Estate.
Grace Yarber: We had a… on.
Steve Rozenberg: Yeah.
Tarl Yarber: We got really creative there and then there’s no other backstory besides that.
Alex Osenenko: What’s the premise behind the entity? Is it just sort of your fix and flip entity?
Tarl Yarber: Fixated real estate right now is just our branding and we run no real estate through whatsoever because we used to and then but for asset protection purposes it’s too popular now. We run all our real estate into our other entities and stuff too, which we’re not going to say.
Grace Yarber: [inaudible 00:22:110].
Tarl Yarber: But for [crosstalk 00:22:09] is a branding now, so it’s already Ben’s business. It’s what we’re known for. You Google my name, it pops up everywhere. It’s what it is for our branding purposes only.
Alex Osenenko: Let’s talk about events. Steve, sorry.
Steve Rozenberg: Yes.
Alex Osenenko: Just one thing I want to dig a little deeper in-
Steve Rozenberg: That’s actually where I was going to go on this.
Alex Osenenko: Perfect. Maybe our listeners are thinking, okay I attended a lot of meet ups. Maybe I have some connections. I want to have deeper relationships with people around me. I want to create events. I ran three events myself. You are what, on your third or second?
Tarl Yarber: For annual. We’re going to have fourth.
Alex Osenenko: Annual fourth so you have some experience. What do you-
Steve Rozenberg: Then he does a lot of the-
Grace Yarber: Monthly meet ups.
Steve Rozenberg: Monthly meet ups as well in multiple cities now too.
Alex Osenenko: Very interesting. How do you peg the success? Because in my view, it’s hellish labor with zero appreciation, no love and no money.
Steve Rozenberg: That’s true.
Alex Osenenko: How do you-
Tarl Yarber: A little bit funny.
Alex Osenenko: I’m sorry, how do you judge it? Like is it good for you, as it has been? Have you guys figured it out yet?
Tarl Yarber: Awesome.
Alex Osenenko: Be honest.
Tarl Yarber: In the beginning, no it sucked. It was a lot of work. Like just you said, very little to no money.
Steve Rozenberg: Whoever came up with that idea and do an event.
Steve Rozenberg: That all right. [inaudible 00:23:23] since business started.
Grace Yarber: If I was never for profit, like, “Hey, you going to do it because you’re going to make huge margin.” That wasn’t like not a popular invention ever.
Tarl Yarber: Truth be told the only way to make real money in an events business for real estate is to sell from the stage.
Steve Rozenberg: Yeah.
Tarl Yarber: That’s the only… And we’ve done a lot. Our last event-
Grace Yarber: [inaudible 00:23:41] that they sell on stage and we liked it.
Tarl Yarber: There’s a lot of money to be made there. Our annually event, we’re at a 50% expense for it, so were 50% profit ratio on our annual event.
Alex Osenenko: I don’t know how you do that.
Steve Rozenberg: That’s great.
Tarl Yarber: Yeah, and one day we’ll talk about it, but there’s a lot to it. Now what we had learned from the last event, even though, we’re at a 50% profit for it, the amount of time, energy, effort, everything come from it, right.
Alex Osenenko: Hourly rate, you still get it at eight bucks an hour.
Tarl Yarber: Yeah, that’s right. What I’ve learned from it, we get more out of the indirect approach from doing the events, from all the different tertiary things than from the relationships and all the different strategic partnerships and everything than this next one that we do in 2020 for our annual event. We’re going to be more hands off in a sense where all hire marketing companies and do instead of us to be in the market for instance. And so, things that we can take off our plate to make it more of a cookie cutter approach and go like, “Okay, I don’t need to have a 50% profit right ratio. When have like a 20% instead.”
Steve Rozenberg: And had nothing to do with it less. Yeah.
Tarl Yarber: Have less to do with it. And the-
Grace Yarber: You’re buying time that we can be using for something else.
Tarl Yarber: To then emphasis back into our personal business and get the… We can spend more time focusing on promoting our stuff within the event versus, just promoting the event. So that’ll change things for us to make our lives a lot happier. We also turn our event to a profit. Obviously our nonprofit, a charity fundraiser as well, so we raised $230,000 on the last one.
Grace Yarber: Thanks to Steve [inaudible 00:25:06] has a given his time too.
Steve Rozenberg: Yeah, twice in this. The first one you guys did great, right? The first event, the first time you raised your money last year.
Tarl Yarber: 120,000 in the first year and 230,000 the second year.
Steve Rozenberg: Yeah, that’s great.
Tarl Yarber: That’s not including the profits so that’s all donation.
Alex Osenenko: That’s really cool.
Steve Rozenberg: Yeah.
Alex Osenenko: Grace, what do you think about events? It’s a lot of work. It’s very, very busy. Are you getting tasked with this or like who does most work?
Grace Yarber: I absolutely love events.
Alex Osenenko: I know.
Grace Yarber: I think that’s why we have such a good team. My main role in our investment business is managing our rentals, so events is another aspect where we’re both brought together and our team like we absolutely love. It’s a huge reward where you create any event that you can give back to community. We really believe in choosing to raise money for something like a local organization that we do due diligence on our end as well, such as Travis Mills Foundation that helps veterans post 9/11 that have maybe some ailments and amputees to come back to doing different adaptive sports or we really believe in that versus going and helping children in Africa as much as like here. We would like to spread, help everybody. But I feel like we need so much help at home here in the United States. That’s where our mission and the future organizations we will choose will be locally based.
Steve Rozenberg: Yeah. And Travis Mills, he’s got a home up in Maine. A whole thing that… Yeah. You guys had been there a couple of times or-
Tarl Yarber: Twice.
Steve Rozenberg: Now, is that when you got to fight Jocko or what was that?
Tarl Yarber: Yeah, I got Jocko. I almost had him.
Steve Rozenberg: Yeah, I saw that. That’s close.
Tarl Yarber: Yeah, it’s funny. Yeah, whatever. I let them get this one, because you don’t wanna roll with it. Dude, you’re just here with your idol. I’m like, “Man, stop it.”
Steve Rozenberg: Yes.
Grace Yarber: I’d like to give credit to Toro, like we listen to a lot of podcasts. One of Toro’s favorite podcasts is a-
Tarl Yarber: Besides this one.
Tarl Yarber: Besides this one of course.
Grace Yarber: Besides this one of course.
Tarl Yarber: Is Jocko Released [crosstalk 00:27:04].
Grace Yarber: Jocko Released and Jocko was interviewing Travis Mills actually who’s the founder of the organization that we raised the funds for. I remember Toro was so fired up. He was like, “I have no idea how, but we’re going to help this organization.”
Steve Rozenberg: That’s cool.
Grace Yarber: The power that podcasts have and reading that space and time to listen and learn from it, that’s so important.
Tarl Yarber: And we found out too, actually when we were just in Maine a few weeks ago for… That’s where Travis and Jocko was there. That one podcast episode that Jocko did for Travis Mills raised $500,000 for the Travis Mills Foundation.
Alex Osenenko: Wow.
Tarl Yarber: And we were at 350,000 of it, yeah.
Grace Yarber: That was two-three years ago?
Steve Rozenberg: That was awesome.
Tarl Yarber: But anyways, beside point. The event that goes full circle back. One day I woke up and I said, “We should do our own meet up, right.” We did a meet up two weeks later, we had 110 people show up to it because… And we just decided, I’m gonna just go do the meet up that I want to go to as an investor. Taking the Tim Ferriss approach of the audience as one first so Tim Ferriss talks about that with his podcast. He just wanted to do his own podcast for himself, like to interview people that way. Then I’m like, “All right, we’ll do the same thing where I meet up.” Then 110 people showed up the next month, 220 people showed up. And then I’m like, “All right, well I guess people want to do this.” So it just became a regular monthly thing and consumed us… Consumed me and Ashley because she still worked at her job at the time and as she took away from our real estate business and actually hurt us a little bit, right?
Because I was taking my eye off the ball because I was so focused on the new shiny object. And that we learned to adapt through that. It wasn’t actually until Grace was really full time that the events business started figuring itself out, because I might be able to bring the people but she’s the glue to everything, so she-
Steve Rozenberg: Grace runs the [crosstalk 00:28:47]. She does a great job.
Tarl Yarber: Yeah.
Alex Osenenko: A question, you manage events and that’s a lot of moving parts. I know it could be exciting, thrilling but it’s also like you got to be super well organized.
Tarl Yarber: Yes.
Alex Osenenko: Okay. Managing properties is kind of similar. What do you like more? Do you like manage… Managing properties is your thing or are you doing it because you have to and you’d rather do events?
Grace Yarber: Do you mean like real estate there’s not much excitement about it like I think that why [inaudible 00:29:13] be like so together on the same page, to me it’s a vehicle to our freedom. My end goal is like, “Okay, we would like to have a family and future children. I want to hustle and work to create that passive income.” Then I have a choice whether to work or like spend X number of hours with the kids or not. That it becomes a choice. Saying that like events, I think it has a lot of similarities when it comes to property management. Events are so much more exciting I think, because that’s where meeting Steve meeting you, anybody-
Alex Osenenko: Is that a complaint counter necessarily?
Grace Yarber: It’s so much lethargic.
Alex Osenenko: It’s not as bad, right?
Grace Yarber: He’s like, “Hey, I shared information. What I have learned. Like you sharing what’s happening in your life.” I’m very social so events business, it becomes like it’s not like a job or work.
Steve Rozenberg: It’s a fun thing.
Grace Yarber: Yeah.
Steve Rozenberg: I mean let’s face it. Property management, I don’t want to say necessary evil, but it’s people call when they have a problem. They don’t call you to say, this is great. When you’re doing an event, you’re building up to an exciting thing-
Tarl Yarber: [crosstalk 00:30:18].
Steve Rozenberg: Well, from my perspective, I’ve never put them on, but-
Tarl Yarber: Yeah, it’s exciting once it’s done sometimes.
Steve Rozenberg: Yeah. [crosstalk 00:30:29] at the events.
Alex Osenenko: You’ll see that you move people, but it’s like you always give back to the people that you are there. They’re upset of vendors didn’t get the right location. I mean, gosh, there’s so many things, like the chicken is not right, somebody who quit like it was in the middle of it. There’s so many things going on, but if you want your properties managed, we know what property manager in Seattle that can help.
Steve Rozenberg: Yes.
Tarl Yarber: Cool.
Alex Osenenko: Cheers.
Grace Yarber: Awesome, I can-
Steve Rozenberg: Enrique you ever heard of him?
Tarl Yarber: Yeah, Enrique [inaudible 00:30:56].
Grace Yarber: Cannot wait to hear. Can I give you want an example?
Alex Osenenko: Yes.
Grace Yarber: We were flying to BiggerPockets conference and that’s in Seattle. TSC agent you looks at me. He’s like, “Oh my gosh, you look so excited. You must be going on vacation.” I am flying to BiggerPockets Conference.
Steve Rozenberg: Yeah, I’m going on vacation.
Grace Yarber: So, I guess to answer your question a little bit, events are amazing. Especially like when you attend to other people’s events. It was like not, not as much stress like when we are hosting ours, I guess.
Steve Rozenberg: Sure.
Tarl Yarber: And even as investors or other people. If there’s not a networking, so important. If you’re not finding any place to go network, then you create your own thing. That’s what I believe in and just make it. Who cares about catering to everybody else. Just create what you want to go to. Then the people that are interested in the same things as you are, we’ll show up through it. The people that aren’t aren’t going to show up, why would you want them to show up because they’re not interested.
Steve Rozenberg: Yeah, true.
Tarl Yarber: Just create your own thing.
Steve Rozenberg: I think that when you go to these events and you meet people like Grace and Tarl, we’ll use your event. BiggerPockets Guys were there Brandon, I met Brandon. I met all the people.
Tarl Yarber: Scott was there.
Steve Rozenberg: Scott was there, and the next thing you know that led to doing a mastermind. And so, then two months ago, three months ago, we were all in Maui together doing a mastermind. Getting to know each other much more in depth and having conversations.
Grace Yarber: That was like one family [inaudible 00:32:11].
Steve Rozenberg: Yeah. Now everyone’s here and you know them and these are all people from all walks of real estate but doing something. But it was the event that actually got that whole thing started. So without that event, I would’ve never met all of the other people and it would not have led to what we’re doing today. So I see that as the plus of the events, but I don’t see the back end of what’s going on.
Alex Osenenko: Does the takeaway for the listeners here is like, “Hey, attend these high quality events that people recommend, like go to BiggerPockets, go to PNW.” Go to the respected events and from there you can network out to see other events. But my little tidbit on top of this would be, see if you can become a speaker because that’s the best. You don’t want to be invent host trust me, it’s hell. You guys are making painting, a pretty picture. I know there’s a lot of problems. You’ll love it, good luck finding somebody who loves it like that. But to be a speaker at an event, if you’re good at something, you probably need it. That would be the best status. You attend as a speaker, you get instant credibility, respect and you meet higher caliber people. You have deeper conversations. Steve’s always a speaker. Everywhere you go. Tarl, I don’t know if you speak a lot.
Steve Rozenberg: Yeah.
Grace Yarber: Besides my-
Alex Osenenko: Grace, you do speak?
Grace Yarber: Yes I do. Besides my husband, Steve is one of my other favorites.
Steve Rozenberg: Oh, look at that. Thank you.
Alex Osenenko: He’s heard this [crosstalk 00:33:27], he does not need to… Okay.
Steve Rozenberg: Yeah, I think, but it’s a good point. I mean, not even as a speaker, just going and being open to meeting people. I think a lot of times when people go to events, they always want to put on a persona that they’re bigger and more successful than they are. But it’s-
Alex Osenenko: Top dog.
Steve Rozenberg: Yeah, but if you go to an event and you’re just open with people and you can just talk to them. And you’re open about what you’re doing or where you want to go.
Grace Yarber: That’s the key.
Steve Rozenberg: People will be very receptive to helping you. And especially when… Again, just going back to the theme of this whole thing was you get a husband and wife doing something. If husband and wives want to go, they should go together because what happens? The husband comes back from an event and he tells his wife, we’re doing this, this, this and this and the wife’s like, “Oh, you went to a conference again.” But if the wife goes with him, then all of a sudden she starts seeing it, she gets it, she understands it, and then they do it as a team, right.
Grace Yarber: I agree. I met two couples today who approach like how I’m talking to my girlfriend and, do you remember the one guy from Ohio? He’s like, “Oh no, like she’s not in it.”
Steve Rozenberg: Yeah.
Grace Yarber: That’s because he’s here alone.
Steve Rozenberg: Yeah, exactly. But even if they’re not into it, but if they’re just here and they see what you’re seeing and they get the vibe and they get everything, at least when you go home, you understand it’s a support system and it’s irrespective of what if Tarl was doing all this and you didn’t want to know anything about it. And TarL was off running around doing BiggerPockets and conferences, you’d be like, “What are you doing? Where are you going?” And so there becomes the disconnect, right?
Grace Yarber: It might become friction into some couples as well because then it’s time spent elsewhere and you could be like a little kids and like football games are missed whatever, right? Then we realized like how much it takes-
Steve Rozenberg: Sure.
Grace Yarber: [inaudible 00:35:08] that business.
Steve Rozenberg: Absolutely.
Grace Yarber: And networking is the key, it has been for us.
Alex Osenenko: Just Piggyback on that. The number one reason why I believe anybody should go to these things is networking more than anything.
Steve Rozenberg: Yes, I agree.
Alex Osenenko: I think that I can say right now, 100% or 99% of the reason why I think I’m successful is because of networking and just meeting people and harvesting those relationships and building those relationships. And it’s been so huge over the years for our company in so many ways.
Steve Rozenberg: I couldn’t agree more. I mean, just your last event, the amount of people that I’ve met, that was what, six months ago, your event?
Alex Osenenko: Yeah.
Grace Yarber: April-
Steve Rozenberg: You guys had 900 people there.
Alex Osenenko: 950.
Steve Rozenberg: 950, sorry. But I mean, but the people that I got to meet and just from that elevated me to another level of getting to know the people. You got to go hang out with Forbes Riley. I mean just the people that were there and you got to, where were you? You were in Idaho with Ken.
Tarl Yarber: Oh, Ken McElroy.
Steve Rozenberg: You got to meet Ken [inaudible 00:36:03]. I mean that was all-
Tarl Yarber: I became friends with Ken McElroy, the author of ABCs of Real Estate Investing because of our event.
Steve Rozenberg: Because of your event.
Tarl Yarber: Now, we’re buddies and stuff like that. But even then, it’s like, it’s all even when something bad happens, this is what I leveraged most of my networking for. Is that when something really bad happens to us in real estate, I call other investors that I’ve met, worked with that have had the same experiences and be like, “Hey, when this has happened to you, like what do you do?” We had a house burn down for the first time a few weeks ago and I’ve never had a house burn down. So besides my insurance company, I call on other investors and be like, “Hey, have you ever had a house burn down?”
Steve Rozenberg: What do I need to know? Absolutely.
Grace Yarber: Yeah.
Alex Osenenko: He did so you’re his book, so here is a good book.
Steve Rozenberg: Yeah.
Grace Yarber: You’re smiling so long.
Alex Osenenko: It was a while back, right? I just read his book on a plane right here, which is very educational by the way. Those of you listening, Steve Rosenberg pick up his book, How I failed My Way Into Millions.
Steve Rozenberg: Failed my way into millions.
Alex Osenenko: Failed my way in a millions, some really good stuff. It’s a short read but impactful. Let’s finish with this-
Tarl Yarber: Failed my way as a debt or [inaudible 00:36:57].
Steve Rozenberg: In millions, I never said dollars. I just said really a million.
Alex Osenenko: One thing I wanted to… Fantastic interview, I think everybody’s learning a lot. You guys have passion for each other, which is I think-
Steve Rozenberg: Awesome.
Alex Osenenko: I think that’s where you’d start with, like you want to spend time with each other. If you listen and you don’t want to spend time with your significant other, I don’t think whatever you do, it’s not gonna work. Right? So you’re passionate for each other, but then from there you work it out. You start with why and you build it out. I want it, you are like master networker and this is something I want to take away from this interview as well as the audience. How do you keep track of all those relationships? You also have to prioritize them, don’t you? You don’t want to just be keeping track with everybody because then you have no time. How do you do that?
Tarl Yarber: That’s a great question. I used to actually keep CRNs on people and stuff. And keep notes and what not and even take pictures of the business cards and go from there. Over the last two years, I’ve become really lazy with that because it’s just too many people on a sense. I haven’t needed this. It sounds bad, but like I haven’t needed to build the company as much as I used to instead, I’m really good strategic networker now and so I focus on the ones that I’m going to build relationships with because there’s time’s limited. I will still keep track of people will still, keep cards, do all that stuff. We’ll still have social media relationships and all that great stuff. But the people that I know, I’m like, “No, I’m actually going to build a relationship with this person because they’re somebody that I want in my life in some capacity.” Then I just absolutely put the effort into it as much as possible. And so-
Steve Rozenberg: Is that why you don’t call me?
Tarl Yarber: I think so, yeah.
Alex Osenenko: It’s not quantity, it’s quality.
Tarl Yarber: Now it is.
Alex Osenenko: It’s like trying to get wide, it’s trying to get narrow and specific.
Tarl Yarber: Honestly, it’s like I want to go for the people that know all the people, right? Why do I need to know everybody when I could just know a few people that know everybody. I’m more of a strategic aspect on that. So like, okay, if I’m going to sit there and well, I don’t want to go down the hole because I might call some people out. Be like why did I [inaudible 00:38:54].
Grace Yarber: That’s how [crosstalk 00:38:56] right?
Tarl Yarber: But ultimately, yeah. Like okay, I’ll give you a case in point, right? Just a simple business example. When I was opening up like, states for our service area management company for Fannie Mae. We had to open up Chicago, right? Case in point, I’m friends with most in Washington, I’m friends with the VPs for Fidelity National Title and all that stuff. I think one of the most underutilized resources is your title reps in your title companies for networking purposes specifically because they know who’s doing business.
Steve Rozenberg: Yeah, that’s closing deals.
Tarl Yarber: I always love it. Anytime I opened up in another state, I’d always reach out to my Fidelity and I became really good friends with the Florida Fidelity National VP and stuff there. Anytime I opened up anywhere I was like, “Get me in touch with whoever the people are in that state or that city.” Then so in Chicago I had to hire, I had like one week to hire a whole bunch of contractors for Fannie Mae. I reached out to the Fidelity manager there after getting introductions from two different Fidelity people from different states and I leveraged them to say, I need to meet as many builders and contractors as you know. Who are your clients that are your builders or your clients that are contractors that we work with and other investors, [inaudible 00:40:08]. I started selling them on the fact that like, “This is going to be good for Fidelity as well.” He looked cool.
I interviewed something like 65 or 68 contractors in three days and I did nothing for it. All I had to do is just show up and Fidelity had all those contractors there for me because I found who knew everybody and then built a relationship with them, shows valuable then they go. Then they went out there and got all the work done for me so that I can just show up and do my thing, right. But that’s a business aspect on it. But even then, how can you do that with… For me, I’m like, “Okay, if I want to become friends with the people at BiggerPockets, is it good to go to the person that just started MVP or do I go straight? How do I get into friends with Scott [inaudible 00:40:46] and all those other guys?”
Steve Rozenberg: If I had your confidence-
Tarl Yarber: It’s those kind of strategic leveraging and networking that I try to focus on, but it’s genuine too. Worst cases, we’re friends with his friends, we just hang out. I don’t know. It’s like there’s nothing other than that.
Grace Yarber: If I may add, those relationships of the real shakers and movers has really opened our eye like me. We’re not a big thing because of like five, ten years from now I think of hanging out like who your sphere of influence is has made a huge impact to us. Like we became friends and we have a couple of couples, like [inaudible 00:41:26]. Such an amazing couple like our besties. We look up to them of how they led their lives, how they build not only in business but like what they are shopping if you like. As a people we get so much satisfaction and as mutual like we have the patience to minded people who are crushing in this business.
Tarl Yarber: Like, like-minded people.
Steve Rozenberg: Absolutely.
Tarl Yarber: There’s zero chance I will network and become friends with somebody that don’t want to be friends with, like it’s just like if they are like-minded, if they’re the same type of drive or more or better then I want to be friends with them anyways.
Steve Rozenberg: Right.
Tarl Yarber: Why wouldn’t I? I think most people that are… Most people like to be around people like themselves or people that are better than them. Well actually that’s not true. Not everybody likes to be around people that are better than them because of an ego situation.
Steve Rozenberg: Sure.
Tarl Yarber: But once you can get past that, it raises you up. That’s what I do now. It’s more strategic focused networking than anything.
Alex Osenenko: That’s been absolutely fascinating you guys. Thank you very much for dedicating your time. I know you’re busy. You’re networking, you got to know who you know, you got to know people who know other people and hopefully, I mean you sharing this information out there will come back to you in many ways. So thank you for taking the time.
Grace Yarber: Thank you so much for having us, such a pleasure guys. Thank you so much.
Steve Rozenberg: Thanks guys. You guys are awesome. All right, we’ll see you guys. Thanks everyone.

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