Client Spotlight: How Former NFL Kicker Doug Brien Built a $3 Billion Rental Property Management Enterprise
For seasoned NFL kicker and Waypoint Homes Co-Founder Doug Brien, many of the lessons he learned on the gridiron over a long career playing for teams such as the San Francisco 49ers and the New Orleans Saints — working with teammates, focusing on a shared goal, remaining humble — have proven to be directly applicable to his entrepreneurial pursuits.
In just a few years, Waypoint has grown into the second largest single-family rental real estate investment trust (REIT) in the U.S., boasting 500 employees and a $3 billion portfolio of rental properties nationwide.
Now Doug has launched Mynd, the first rental property management mobile app, which allows both landlords and tenants to access real-time data concerning everything from maintenance updates to rental income status and more.
We recently caught up with Doug to learn more about the growth of his two companies, his plans to cause a major shift in the real estate management paradigm and — of course — which football teams he’d bet on this season.
It seems like a big switch to go from NFL player to startup entrepreneur… or was it?
It was. But I’m able to translate a lot of things from my time in football to entrepreneurship. One of the biggest lessons I carried over into real estate came from my experience playing for some of the greatest coaches in football. Mike Ditka, Tony Dungy and George Seifert each had different coaching styles, but were all very successful. I learned that whatever your leadership style is, it has to be authentic to you.
In business and in sports, it’s all about creating a vision, aligning goals, organizing and motivating people. You have to have a good idea, but you also need more than that. How you really achieve success is by getting a group to collaborate and work together to create one-plus-one-equals-three scenarios, where the sum is greater than its parts.
Starting out, you met many in the real estate industry who believed single-family rentals couldn’t be managed efficiently, and at scale. How did you prove them wrong with Waypoint Homes?
My business partner and I began Waypoint as an individual investment. We thought it was such a compelling idea. Then we realized that cloud and mobile computing were going to really change the market of real estate investing — this technology meant we could create a system to organize a large number of homes and run them as an efficient portfolio. We saw that as a massive opportunity and a total dislocation of values. It was scary: Home values were falling precipitously. But we looked at the long-term horizon — we planned to buy and own homes for 10 years. Then, even if rents and values dropped by 20 percent, that was OK, because we were getting 50-percent loans on the cost, not the value. We were doing our own renovations, increasing the value of these homes, and holding them for cash value.
Only after doing it with our own money did we confirm our hunch that this is actually a solid investment. That’s when we felt confident enough to ask others to invest.
What was it like to raise money after the 2008 financial crisis began?
Not easy. Single-family home values fell significantly between 2009 and 2011. Most of our early efforts were spent convincing people they should invest in single-family rentals in general, and then we had to convince them to invest with us. On top of that, we couldn’t secure traditional financing of the rental homes — even though it’s such a positive cash flow investment. Ultimately we had to raise $100 million of private equity to put thousands of properties under management and prove it was an institutional asset class. We had to basically sell the dream and assure people that we could figure it out.
It sounds cliché, but this mantra kept us going: Never give up. Most great businesses were built on rejection. A lot of people will say no or won’t believe in you. You have to be confident, well-informed and carry yourself as if you can do this — otherwise, you’re not going to be successful.
With your new company, Mynd, what remaining walls do you plan to break down this time in the property management industry?
We figured out a more efficient way to manage what we call investing in “disaggregated residential real estate.” With any residential building, whether it’s a single-family home or a 40-unit apartment building, there are no inherent economies of scale. You can’t employ a couple of full-time people to run a building — it’s too small and the cost is too high. So we created this app that showed that buying an apartment building could be more like buying a stock or a bond. You can look at your app and see what’s going on there on a real-time basis, in much the same way you can monitor your investment portfolio in real-time online.
We saw this big opportunity to parlay all the learning we made at Waypoint and provide that to individual investors. My partner and I are super passionate about wealth creation. If we can create a platform for young people to buy real estate and create wealth over time, that’s a pretty cool business.
What advice do you have for people who want to invest in real estate but don’t know where to begin?
You have to educate yourself — learn how to make smart moves in this industry. Figure out what you know and don’t know. That is where building your team is crucial. In those areas you don’t quite fully understand, seek out knowledgeable partners.
Last but not least, which football teams are looking good to you this season?
To me, college sports embody what sports are truly about — passion. In the NFL, it’s often about the money, which makes it feel very impersonal. For me, it’s all about Cal, where I played football in college. I also love the Pac-12 teams. I think this is going to be a tough year for Cal, but I think they have a good long-term future. This year, probably USC and Washington have the best chances at success.
Here’s the thing about college football players: If you went to a good school and you’re a Division I athlete, your skills are so transferable. If you made it to Division I, which is the highest rank, you’ve learned the value of hard work, perseverance, working as a team and how to take criticism. I recruit college athletes who went to good schools for that reason — they’ve learned how to be successful at whatever they do. That is what business is all about, and you learn it in sports.