$200M Real Estate Investing Playbook for Making Billions

Hey, welcome to another episode of Making Billions, I'm your host, Ryan Miller and today I have my dear friend Nic DeAngelo.

Nic is the president of Saint Investment Group, a $200 million real estate fund that has returned an average of 35.5% each year for his investors. He's a three time founder that has been featured in Forbes and Inc and more.

What this means is that Nic understands how to make massive returns in the real estate sector and is about to teach you a masterclass on profiting from private deals, regardless if you're a fund, a syndicator or even a family office.

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[THE GUEST]: Nic is the president of Saint Investment Group, a $200 million real estate fund that has returned an average of 35.5% each year for his investors. He's a three time founder that has been featured in Forbes and Inc and more.

Transcript

Ryan Miller  

My name is Ryan Miller and for the past 15 years, I've helped hundreds of people to raise millions of dollars for their funds and for their startups. If you're serious about raising money, launching your business or taking your life to the next level this show will give you the answers so that you too can enjoy your pursuit of Making Billions. Let's get into it. 

Ryan Miller  

If doing private deals for massive returns sounds like something you need to do, then I have a treat for you join me in my next guest as he walks you through the real estate and fund management playbook so you can raise capital, close deals and pursue your dreams of Making Billions. Let's get into it. 

Ryan Miller  

Hey, welcome to another episode of Making Billions, I'm your host, Ryan Miller and today I have my dear friend Nic DeAngelo. Nic is the president of Saint Investment Group, a $200 million real estate fund that has returned an average of 35.5% each year for his investors. He's a three time founder that has been featured in Forbes and Inc and more. What this means is that Nic understands how to make massive returns in the real estate sector and is about to teach you a masterclass on profiting from private deals, regardless if you're a fund, a syndicator or even a family office. So Nic, welcome to the show, man. 

Nic DeAngelo  

Ryan, longtime friend, right? We finally get to do this and catch up. I've respected your opinion and your insight on so many things, I mean, known each other a long time now, but it's fun to get on the show. I've been seeing what you guys are doing and crushing it. So yeah, man, it's great to be here today. Great to sit down and have some fun talks. 

Ryan Miller  

Yeah, man, it's so great to have you and all this exciting things that you've done at Saint Investment Group, first of all, returning over 35% on average, that is blowing my mind, and I cannot wait to get into it, start chopping it up. So folks, Nic, not only does he run real estate, this is not just real estate centric conversation that we're going to have. We're going to talk about doing deals. As you know, Making Billions is all things, alternative investments and doing deals in the private markets, that's where billions are going to be made, and Nic is about to teach us how to get that done. So we have a lot of beginners and a lot of expert people all around the world, and we're in about 100 countries. I know a lot of people just starting out, or who are seasoned understanding the fundamentals are absolutely key to mastery. For those who are starting out, or really just a refresher on fundamentals, what would you teach them on both A, how to win and B, how not to lose in the fundamental investing game?

Nic DeAngelo  

I love this question because it really is the roots of real estate, right? It's, what would you do day one. There's even TV shows about this topic. What would you do day one? You know, 100 days to a millionaire, or whatever it is, the number one thing, if you're starting off and you want to jump into real estate, is there's one decision before all other decisions, and that's, do you want to be the operator, or do you want to be the investor? Right? Historically, what that decision meant was, if you're the operator, if you're the landlord, you make higher returns, and if you're the investor, you make lower returns but it's passive. That's the old world that we used to live in with real estate but also old world real estate is you used to be able to buy real estate on a credit card. So a lot of things have changed, right? We've come a long way where we're at today. That's a lot muddier, right? Different markets have different return profiles, and I would argue that things have flipped considerably. 

Nic DeAngelo  

So I'll give you the two options. One is, you're the landlord, right? You get to lean in, you make all the decisions, you find the deal, you find the opportunity, you find the market you want to operate in. You purchase it, you go through the whole process. And the reality is, maybe you make higher returns, maybe you don't, but you control your destiny, and you're this, you're the captain of your ship. The other option is, you're the investor, right? You're on the passive side. You find your job then, is to find a really good operator that you trust an operator that's doing the kinds of deals and the kinds of markets that you feel are you're in alignment with, and you feel parallel as far as what they're doing and how they're doing it, and that you get to be passive with your investment on that side and probably make similar returns. So there's a lot of advantages to both, but it really depends on that decision, where somebody goes from there and leans into either them being the operator and them running an entire business, or them being on the passive side and letting someone else, you know, take the reins of that.

Ryan Miller  

I love that and you know, you and I have been friends for a while, and we've been following each other's career for a while. One of the things that I've loved about you as an operator investor, I would consider you able. You're like the Swiss Army knife. You're able to do all of those things now as a president of a $200 million Real Estate Fund, and you're just getting started, brother, but one of those things that I admire about you is your ability to 10x your results through finding good partnerships. I'm wondering that's a big part, right? When you're scaling up, you're just starting out, you're gonna have find partners. What are some of the things that you look at? Or how do you piece that together? Let's unpack that a little bit of finding the right partners, and just 10x in your results, absolutely.

Nic DeAngelo  

So if you're leaning into the side where you want to be on a more passive scale, and you want to work with other operators, I think the reality is you have to be a professional at finding the right people, like you're saying. So what would that look like? Right? The first thing is identifying a few pieces on your side with what your variables are and what you think are going to be the biggest opportunities and that would be like, what asset class. What style do they invest in market wise, right? Are they looking for, like, big, gigantic, you know, tier one, Premier markets, or are they looking for more tertiary, kind of, like tier two, secondary markets, where maybe there's some different niches that aren't being addressed in the big market side. From there, honestly, it's doing what we're doing right now. It's seeing and watching podcasts and seeing different operators and learning about what they are doing and making sure that you as the investor click with what that operator is doing, right so let's see some things that might include track record. Are they killing it? Have they killed it in the past? Most importantly, today, most recent track record, are they paying their bills to investors? And I know that you know this, but I'm going to say this for the listeners, many, many, many real estate operators today are not paying their bills, right? They are not providing preferred returns or distributions to investors because they cut their deals too close, right? So that would be one of the first questions I'm asking is, are they paying their preferred returns, their distributions, to their investors today? 

Nic DeAngelo  

Then it's things like digging into their company, understand what they're doing, right? And do you vibe and understand clearly what their goals are? And does that meet your investment criteria of what you're looking for? And the third, I'm just going to kind of put it out there is that, how transparent are they, right? That can take a lot of shapes, that can take a lot of options, but overall, it's a score of transparency. So at Saint, right, our goal was always huge amounts of transparency. I'm a little younger than the industry average, right? So in order for me to compensate for that, with our investors, many of which are boomers, many of which are eight, nine figure, very, very wealthy, very, very successful people. I was like, hey guys, Saint team, we need to be a level 10,000 transparency, right when we make a decision, we have to be very clear with how and why we made that decision. So the example that I use is a lot of our investors, very sophisticated individuals, will say, will, how do you make economic decisions? I heard that enough times. I literally just released to our investors our exact economic spreadsheet, exactly what we look at, right? What are we looking at, jobs? What are we looking at, local market reports? What are we looking at? CPI, PCE, PPI, everything is on one piece of paper, so that it's on one spreadsheet for investors to see exactly where we make decisions from. So I would say that degree of transparency, it really clears the deck with trust, because they either vibe with what that group is doing and they understand the investment thesis of that group, or they don't. Both are okay, but the clarity is there that the investor can make the right decision. 

Nic DeAngelo  

And then the other side of that is, if you do want to be the landlord, right? So do you want to be the password, or do you want to be the landlord? How would you be the best possible landlord you could if you're starting from square one, right the other side of the coin is if you stepped into the market today and had zero experience, and you wanted to buy real estate as the operating landlord, I would tell you it's a simple plan, simple, not easy, extremely difficult, long road, but it is pretty simple. And the first goal is to be an underwriting professional, a level 10 out of 10 on underwriting. You got to underwrite 100 deals. So there's a few places you can go to find those. You can go on, you know, costar, which is the number one listing service. You can go on LoopNet. You could go on crexi, which are like, you know, secondary but still have a ton of deals. You need to underwrite 100 deals and understand what those look like, because after 100 deals, you're going to understand what a good deal looks like and what a bad deal looks like in your market with the exact numbers. So that's what I'd say as the first step if you were going to go down the landlord path on your own as well.

Ryan Miller  

I love that and underwriting a bunch of deals I would also add just from my own personal experience, if I could. One of the things that I have found that has helped me when starting out is read the legal contracts. 

Nic DeAngelo  

Oh, that's painful. Painful.

Ryan Miller  

It is mind numbing. So tip of the hat to all attorneys that do this for a living. My goodness, reading legal contracts, because that's part of underwriting is really that's like reading the rules to a board game, and if you understand the rules now you can play them better than anybody else, in the words of Warren Buffett, so not only understand the rules, which is basically the legal contracts, but now you know what's offsides? How do you score a touchdown? Whatever that is, you really need to understand the minutiae of deal flow.

Nic DeAngelo  

The underwriting process, exactly to what you're saying, there's so many terms, and there's so much nuance that starting off you don't really understand until you get that volume, but legal ease and the subtlety of what impact you know, small terms make can be huge, huge, huge differentiators between a good deal and a bad deal. And I'll take it a step further and agree with you, further is, I think after you underwrite 100 deals that you make offers on at least 20 of them to get the exact experience that you're talking about, because you'll know what your top 20 ish are, right? You're probably going to find out a few things pretty quickly. The returns that you were hoping to get are not really as common in the market as you think. So, then you have to reduce your offering price to meet those returns, and those are going to be rough conversations. So the terms like you're saying, Ryan, those smaller terms that seem insignificant become very significant, because things like what that lease might look like, or those leases might look like, or different terms as far as timings concerned with your loans, etc, those become very important when you're getting down to percentages of returns to make it, make the deal work or not work. So I would do that 100 deals that you underwrite, make offers on 20 of them, and I would hit a return profile in today's market. If you're not hitting a 15% return per year, I'd say you're much better off investing with somebody else as your operator on that side. And if you can make 15% a year work, a 15 IRR, if you want to kind of tighten that term up a little bit, then I'd say you might be in a market where you can take some shots and make sense of yourself as the landlord, and if that's something you're passionate about.

Ryan Miller  

Yeah, absolutely love that. So, you know, we talk about underwriting and also finding partners. Where do you find these partners? Where do you find them? Like, do you go to events? Do you join communities? Like, what? What is it? Where can you point people to successful pools of successful people who could potentially be a partner in 10x their success?

Nic DeAngelo  

I would give them three options. The first is seeing who's most active in communities that they're interested in. So podcasts like this, right? Podcasts that they're listening to, whether it's you know, other YouTube, you know, things like that, where they're searching for real estate to learn and to understand who's the most active. Those are the people whose teams are not only typically the most successful in the market, but can give the most value and give the most feedback of what they're seeing. That's the first second is I would be looking for just a straight up Google search. I'd be searching for the things that they're looking for. So if they want apartments, or if they want industrial or they want something in self storage, there will be searches of people that consistently come up on their radar. And then third, which is just so rock solid, but it does zoom in to a smaller group, is asking people that they know that are successful investing in real estate, what they are doing, and who they're investing with consistently. And between those three, you're going to see some overlap, and you're going to see some really good results come up, where you kind of have a higher degree of understanding that things cross reference. To make tier, you know, to make certain groups appear head and shoulders above others.

Ryan Miller  

Brilliant. So, you know, we mentioned how to win, and we've covered that is work with people, underwrite a lot of deals. Maybe some communities find people on YouTube, just people that are active in their niche. But there's also areas where if you miss the fundamentals, or you just don't understand them to begin with, even if you've been in the game for a while, there's ways you can lose. There's ways you can get knocked off the board too soon by doing silly things and not having the discipline around the fundamentals. So I'm curious from your position, Nic, what would you say are some things that people can do to not lose in this sector?

Nic DeAngelo  

Yeah, that's a great question. I would say this market is a tale of two markets. There's a lot of winners and there's also a lot of losers. We're dealing with economic times that we haven't seen in decades. Right? Inflation, we haven't seen rate, an increase in rates, the trajectory with which we've never seen rates that we haven't seen at this level in four decades. So there's huge opportunities, but there's also huge risks in the market that we haven't seen in a long period of time. The three, you know, I'd say a few things, you know, two or three, head and shoulders, advice that I give people. 

Nic DeAngelo  

The first is getting with the best people, talent wise. So if you're operating in the market, the disproportionate value of hiring the best people has never been more apparent, right? We're dealing with a work from home environment that shifted where, at one point during covid It was over half. Over half of all employees in the US were working from home. It was 52% I believe was the was the metric, right? Pre covid, I think it was 8% so 1 out of every 12 ish that went up to over half. Now we're settling in to about 26% so about 1 in 4 people in the US is working from home. The difference is, if you're a nimble company that's structured for the market that we're in today, you can hire the best talent in the country, as long as you know how to structure and manage a work from home, you know, team. So I would say the opportunity to hire some of the best people, the best talent that's out there, is higher today than we've seen in decades plus, and the opportunity to do so.

Nic DeAngelo  

The second is surrounding yourself with the best people in your networks, right? To operate today, and to, you know, be really competitive in today's market for any business, but especially on the investment side, you must be around people and be comparing notes of what's working. So for me, often, like, I'm part of so many different business groups, right? There's some that are, I mean, Ryan, your group is ridiculous, like your guys are top tier, right? So you know what the difference between a really, really high level group and a high mindset group of people is? I think you have to have that in today's market. You must be part of groups like that. So I'm part of two or three that are head and shoulders of everything else, yours, included. 

Nic DeAngelo  

And then the third, I think tracking your data has never been more important today because of how fast things are moving. I think we're seeing huge ebbs, huge flows, return profiles changing. We're seeing markets that have all kinds of different variables that are changing. I mean, just look at employment in the US right, the highs and the lows of that, and how that drags or pulls on inflation, you have to stay close to those numbers. I'm positive. You know this on the VC side, with so many different companies and company types real estate's the same way different asset classes in real estate have different things, you must track extremely closely, and month to month, they change. So staying close to your data is the third thing I'd say you got to be very, very, very close to the vest on.

Ryan Miller  

Yeah, thanks. Thanks for the shout out, so that's The League, so that that group that we're a part of, if you got a minimum of 100 million under management, can apply on the site and see what it is. We travel the world as well as a fundraise capital is one of our courses that teaches people how to raise capital, take from some of the best, like Nic, myself and many others, we have a whole course and a group to just really bring people together. And so this is a phenomenal way that you can meet people, in fact, that's one of the places that we met, and certainly been a pleasure to really bring you in and you and I chop it up together. So one of the areas you mentioned, get into groups, find the right people. When you find those people, I want to unpack this even deeper, so when you find these people, because I know how it is, I've had great partners and some maybe not as great, but one of the things that we found is, and I've learned this from you, is one of the questions you ask people is around revenue and making sure. And I don't want to steal your thunder, but you and I spoke about this. When you're hiring people, you want to make sure they understand how their efforts, whether it's accounts payable, receivable, a capital raiser, a general partner, everybody from janitor to partner and in between, you want to make sure that everybody understands how they contribute to revenue. Can you unpack that and how you go about that process of vetting people around revenue?

Nic DeAngelo  

Yeah, yeah. That's exactly what we do. There's a few people that have brought up variations of this that you know have been people that have followed for a long time. We've adopted that for Saint to be very clear, it's, how do you make the company money? Just, let's keep it really vague, let's not use the terms like revenue or net, etc. We just say, how do you make Saint money, right? Some roles, it's super easy sales, right? How do you make Saint money? I close deals, I bring money in, I'm bottom of the funnel, and I bring deals in for a safe landing. Yeah, pretty much. I mean, it's as straightforward as that. How do you ask someone in accounting how they make the company money? A little more opaque, a little more complex, but still obvious, right? So we want to instill a mindset at Saint where we're all in this together, we are at Saint. We are a for profit enterprise, and if somebody can't understand how they fit into the the financial goals of the company, then they don't understand the big picture, to a degree of an owner or leadership or C level executive, and it makes it much more difficult to train that person to think, you know, as a group's, you know, in a group setting. So by the time we get downstream, we say, hey, you're responsible for these KPIs, these metrics that are your responsibility to perform within. They don't understand how that computes to the whole if they don't understand how they make the company money. So the answer to somebody like, you know, in the accounting world is, well, if I reduce expenses by this percent, then not only did I pay for my salary, but I also brought X percent return to the bottom line, which means that investors made this percent, the House made this percent. You know, when they understand to that degree, and they can explain to that degree, we know that they understand the company on a broader scale, and they feel more important being a piece of that. So it really is all encompassing, but it's just a really good indicator that they're mature enough in their business, and they're experienced enough in a company setting to understand the finances behind activities.

Ryan Miller  

Yeah, that's brilliant. And you know, when you started out, you've told me this story, and I would love for you to share, just to give some of these budding deal makers some some direction. But I know when you started out, you found a way and I have my own story. And I'm sure if you've been following the show, you've heard it of how I broke into the industry with in the middle of the oh eight recession, but you did something similar to what I did, and we've we've exchanged our war wounds from making it through recessions, actually making it out better than when we went in. There was something about a mailing list, there was a story that you told me. I wonder if you can share that just to really spark people who are launching. What did you do in the early days as it related to making a mailing list? 

Nic DeAngelo  

Yeah, I love origin stories for the reason that I think most people gloss over the most key moments where you get access to things or you level up, disproportionately, you level up to a much higher degree. For me, it was clear I wanted to be around the biggest winners I could, people that were head and shoulders above what I actually probably deserved at that time, if we're being fair. And I had to get in that room, and I had to get it to the table and I knew I was very clear that even though I had been working for many years, I did construction, I was a teller at a bank, not competitive, value added experience enough to get. At the table of, let's say, a family office. And I was like, well, damn, these guys are doing all the deals. How do I get close to that? 

Nic DeAngelo  

So what I did was, first thing was targeting, I wanted to find groups that I could get close to, that were small enough where I could get close to the CEO, the, you know, the masterminds behind that, get a seat at the C level table, but big enough and enough experience where I could really just soak in as much as possible. So what I did was I reached out to a couple family offices that targeted very, very, you know, exactly my parameters. And I reached out and I thought I was a shoe in, right? It was, it was 2008, 2009 just like your story that you alluded to. And I was like, well, shoot these guys need all the help they can get, right? Like, this is a tough market, you know, I got something they can't say no to. So I reach out, you know, I got a hold of the CEO, I did my best on my phone, tap dancing to try and get to the CEO. Finally got him on the phone, and I just said, hey, you know, like I've been following what you guys are doing, and I think it's really compelling. I have a I have a proposal for you, I have an amazing proposal, I'm gonna work for you for free, right? I How do you say no to free labor? And he starts laughing, not not in a rude way, but a little condescending, a little like, Oh, come on, bud. You know, in a way where he basically responded, his response to me, saying, I'm gonna work for free. You can't say no to this, he said, free, I can't afford you. Do you know how expensive free is right now? And I'm shocked. I'm like, a kid, my early 20s, shocked that my free labor was too expensive. So I'm like, Well, what do you mean? I'm gonna work for free? And he's like, Do you have any idea how much time and effort and energy it would take me just to train you to have a break even to this organization? And I'm sitting there, you know, I gotta slap on both cheeks now, right? Like, I'm like, you know, really, really, really, just shocked. I said, well, look, I don't even really know what to ask here, but how would I come work for you? And he's like, kid, if you want me to be honest, the only way that you have any chance of working for us is by making me money. Show me a way to make money, bring revenue in the worst market we've seen since the Great Depression. If you can find a way to make me money, then we'll have a conversation. But I gotta go, good luck. Click right, and I'm sitting there in shock. I'm like, don't even, I don't even know what to say at this point, but what I did know was I was okay at marketing. Okay? I put together marketing in the past. I had actually done some real estate marketing in the past for just some friends and family that had, you know, kind of smaller deals. So I kind of knew the lingo a little bit. I kind of knew the investment community a tiny bit. So what I did was I looked at all the real estate investment groups at that time, and I went to these groups, and I started a mailing list and just said, Look, write your name down if you want to do deals and I have deals. I have all kinds of deals right now in this market. If you have money and you want to do deals, write your name down. And I started a mailing list, I built it up to about 500 plus names. And that was pretty substantial at that time, considering the sky was falling and foreclosure rates were records, and nobody had any money, and it was an insane market. So I called that same CEO up after I put this list together, and I said, hey, I read you loud and clear. I now understand better, and I didn't at the time, so sorry for wasting your time, but you talked about revenue, and I can make you money now. I have a list of 500 names and phone numbers and email addresses of people that want to do deals right now. So while you do have a family office, a multi generational real estate family office, you also have a brokerage, and that brokerage has brokers sitting there waiting for deals these guys will buy right now so you can make money off them. So that me asking stupid questions in the office or following you around to do whatever little tasks that you need done is actually a net gain, because your brokers are making you the money. So you can write off anytime it would take to train me and have a major net positive. He laughed his butt off, right, and at the end of the day, he's like, Look, I'll find you a desk in the back and that's how I got started in real estate on a full time basis. 

Ryan Miller  

Brilliant. My man that that's phenomenal. Similar origin stories. I met a guy at about 100 mil, built him a financial model for a power plant for free. Obviously, someone with that background financial backing can hire anybody they want. I just finished grad school. And I was like, I just want to work around you. And I remembered credit tip of the hat to this knowledge has been around for a while, but Robert Kiyosaki, and I remember him saying, whether you agree or disagree, this point really spoke to me when I was starting out, is the rich don't work for money. And I was like, just wrapped up my my time in on Wall Street, finished grad school. And I was like, I have no idea what I'm idea what I'm gonna do. I love finance, economics and same thing built this guy financial model. And you just find these people that are doing deals literally everything Nic is teaching you guys, folks is the exact same origin story that I went through, and many other people is just saying I found a way forward. You either buy your way in or you work your way in. And when you're starting out in your in your 20s, like Nic and I were, we're like, I don't have any money, but I got energy and I was like, dude, put me to work. I will literally do anything. I will grind myself down to a nub just to try to, like, get and break into this industry and it's inspiring. 

Ryan Miller  

I'm telling you right now, from now the little gray in my beard, now I'm the guy that people come to and say, I'll work for you for free. I'm telling you, offer something, provide value, and it is an easy sell. Free is expensive. Create value. Show that you understand how he makes money, and you're going to help him or her with that you're gonna you're gonna help make money. You're gonna get those positions, you're gonna break into that industry. I absolutely love it. So those are one of the ways that you don't lose, lose a position, is you actually just find a way to add value, not just say, Hey, will you train me for free? You won't have to pay me. That's not enough. You actually have to justify your existence from the bottom line. So I absolutely love that. Now we wouldn't be a show called Making Billions if we didn't talk about the market. So this is something that you really shine in. You guys deal in not only marketing, but also understanding the economics of the market. So I'm wondering, just from your perspective, 30,000 foot view, where are we at? And then maybe we'll follow on with where you see the smart money going?

Nic DeAngelo  

Yeah, I spend a lot of time on the economics our team. We have many roles that are almost exclusively stats based, economics based. We spend a disproportionate amount of times compared to a lot of groups focusing only on the market side. So this is what I'm seeing today, and this is what we're consistently seeing over time, is the discussion of the rates, specifically and inflation has been so misunderstood I believe you. You know this, Ryan, you know this. But here's a quick recap. Right? It's beginning of 2020 inflation is at 1.4% middle of 2020, right. Fast forward to middle of 2022, we're at 9.1% inflation. We could talk about all the covid drivers, we could talk about the printing of money, et cetera. But the reality is, where we're at today, years later, is I truly believe this is not a supply chain driven inflation anymore, that we've shifted to demographic and geopolitical, driven, geodemographics, driven inflation drivers. 

Nic DeAngelo  

So my bet moving forward is that we have a decade of things that we're dealing with on the inflation side, maybe not inflation at all, the at all time highs like we've been dealing with for a long period of time, but higher rates if we're offsetting that. If you go into this year, if you go into you know, the end of 2023, Wall Street was betting on six rate cuts, six, right? We know so far we've had zero. We know that now the bet is that we're going to have one, maybe two for the rest of the year. So Wall Street was widely optimistic, overly optimistic by any margin. I still believe, even with rate cuts that that will be mostly politically driven, and drivers that are not based on inflation. Okay? I think those are different motivations that the Fed would have in those cases. 

Nic DeAngelo  

So if that's the case, we're dealing with just inflation as one variable. I think we're also dealing with employment in a huge state of flux. I think the baby boomer generation, the largest generation we've ever had, also the wealthiest generation we've ever had, also the most asset rich generation we've ever had. They're all moving to retirement, if anything, covid sped that up dramatically, right? So now we have somewhere the estimates are between 68 and $72 trillion that's concentrated in the baby boomer generation that over the next 10 to 20 years is going to be filtering through the economy, filtering through the younger generations, and landing in a new place that we've never seen. That's the greatest transfer of wealth in the world history, from the Baby Boomers to younger generations. So that's the backdrop. 

Nic DeAngelo  

So where does that leave us today? A few places, I would say the market today is going to be driven by that for 10 to 20 years. And the best places, I'll give you my top three, what we see as the best drivers, the best underlying factors, and the best 10 plus year investments moving forward the first I like United States, based mortgages. US mortgages, okay? And I say us specifically, because the US has a very unique mortgage structure in the in the entire world, 98% of mortgages in the US are 30 year fixed rate mortgages, right? So they have a fixed rate term, or they have a fixed rate and it's for 30 years. Those are widely unique throughout the world, right? They don't reset every few years, etc, and so people will live in mortgages that they got 10 years ago that are at record rates. It's something like 60% of people are in like the threes and the fours for rates, while the market rate today is in the sevens. 

Nic DeAngelo  

So if you look at what all that equals today, especially with the baby boomers, we look at 10 to 20 years of almost every poll and every driver of housing shows that people are going to be locked into their houses for the next 10 to 20 years because interest rates increasing and the cost of houses increasing, the cost of homes increasing equal about 111% increase in mortgage payments. So people are locked in. So for the next the net, net of that is for the next 10 to 20 years, people are pretty much locked into their homes in the United States. So my number one, my number one choice for investments in the United States, US mortgages for single family homes, number one, number two, I would say, the best drivers on the industrial. Excuse me, the best drivers on the commercial real estate side undoubtedly going to be industrial real estate, right? You look at industrial real estate First off, import towns, import markets, right? So you look at like Southern California, Port of Long Beach, Port of LA. You look at Texas, huge imports on the other coasts, they're southern so they're also close to Mexico, with that huge amount of onshoring and reshoring for manufacturing. We're looking at those markets, we think the next 10 years of industrial driving factors of manufacturing and imports, is off the charts. It's been the belle of the ball for about five years, maybe up to 10 in some markets, but we see a decade plus of super strong industrial the third is multifamily. It's apartments, right? The US is one of the few first world countries that has really strong demographics that are continuing to increase population. Most of that's going to be immigration, but still increase in population. Debt for debt for multifamily, debt for apartments is the best in the world. I mean, you cannot find more favorable debt opportunities for commercial real estate than you're gonna find for apartments. The drivers are there. Cities are still strong. Even tier two tier three markets have some really interesting apartment plays. So those are my top three United States, us, based single family, mortgages, one, industrial real estate, number two, and then number three is going to be apartments.

Ryan Miller  

Brilliant. So that's, that's the play. So sounds like you believe some industrial boom is coming back. I read an accolade that said Donald Trump wants a weaker dollar, right? Whether this is not a political post, we're just saying a politician. We know his name. Wanted that now, me coming from Canada, they do have a weaker dollar policy. So typically, it's if you're primarily an importer or export. It's that simple. Or we'll keep it that simple. So if there is an industrial boom, and we, you know, the the leaders of the US, want to shift towards a more manufacturing export base. So if the dollar's going down, what's the trade? Well, the trade could be real estate and industrial. Exactly what Nic is saying, right? So I'm unpacking it in my own nerdy way. So you know, I'm a good time at parties, but in all seriousness, so if there's a weakening dollar, then the right strategy? Because a lot of people say, Oh, the dollar is getting weak and it's big trouble. But what? No, it's just, you have to shift in strategy, that's all. You have to shift in trade agreements. You have to shift in strategy. But there's tons of countries, I would argue, the majority of countries, when compared to the US dollar a weak, one is saying, well, we want to sell our goods into the market rather than buy goods in the market. So the US has been a consumer, and if they shift to industrial so you see a lot of policies, you see a lot of dollar decisions, and there's a lot of things, from currency to policies to trade agreements. And when you start looking at these things now, you can begin to unpack it, and you can start to see, say, oh, maybe there's a weaker dollar. How do I position that? Because in any environment, you make money. And so if there are weaker dollar, in those headwinds for now, but there'll be tailwinds later, is getting into this manufacturing boom, and you don't even have to manufacture anything, just own industrial just like Nic was suggesting. There's so many ways to do this, folks, and Nic and I are here just screaming into the mic to try to help get you there. So I absolutely love that, and 100% agree so on a weak dollar strategy, folks, if you follow policy, then you might be able to make money, because now we're gonna get into exporter and everything that produces something well, it all has to sit on real estate, doesn't it? So I absolutely love that.

Nic DeAngelo  

I think there's a lot of factors that agree and support what you just said. Another one, same, same, you know, vein of thought is the fact that I think we just recently crossed 35 trillion in debt for the US National debt, right? So if that's the case, and the dollar is weaker and cheaper, right, then we're paying debt back with cheaper dollars, right? So comparatively, we're paying less back than we borrowed, right? So in the US for a long period of time, I know you know the saying, but it's, don't fight the Federal Reserve, don't fight the Fed. So if that's the case, there's many strategies that benefit from that, right? You know, especially on the real estate side, especially I know on the VC side, there's a lot of opportunity there, implementing that on different strategies, but it's the same thing. Weaker dollar has investment benefits if you know what you're doing in that environment. 

Ryan Miller  

I love that, so keeping a finger on the pulse. Don't fight the feds, but if you can understand what it is they're doing and really forecast, it's our job as general partners to look around corners for our investors and really understand that to say, okay, A plus B does, in fact, equal C, and we're going to position ourselves and our investors to benefit from that. And my man, you're one of the best in the game. That's why you've been able to return 35 and a half percent return on real estate all these folks, good for you. That's brilliant. But we're not done. So as we round third base, we take it home. The moment we've all been waiting for is, what is some, what are some secret sauce things that you can give people who are trying to level up who would love to be returning what you return, or running businesses let you run. What are some of those things that you can advise and take us home on our time together today,

Nic DeAngelo  

I would say if someone wanted a level 10 in real estate, it would be understanding their personal strengths on the real estate side, absolutely, because the real estate industry used to be just one segment, one skill set, one group of people could take down real estate in a pretty big way. I think the market has shifted. I think the market has shifted. So I would urge people to choose and understand their own personality, like Ryan, you and I have complementary skill sets, so very different but very complimentary, we get to compare notes all the time. And I'm saying, Hey, we're doing this, and you're saying, hey, we're doing that, and we're both Right, right? We can both say, Hey, we're both finding success here. This isn't one or the other. And I think when people understand that piece, that they can understand where they fit into the puzzle. I know that when I see the real estate market, I'm seeing companies that are focused on one of three areas. The first is capital markets and capital raising pretty consistently. Others are going to be deal guys. They're operators. They're focusing on that piece, and others are going to be more of the operation size, the fund management side, kind of the broader scale that pull all of it together. At Saint we focus specifically on the capital raising side and on the fund management side, because our background was deals. So today, we're building out and growing the pieces that we didn't lean into early on. But you know, we're 15, we're almost 20 years in the game at this point, right? So that's how long it takes to well, round out those pieces. So I tell people, lean in to what you can bring to the market today, whether it's going into a family office and offering to boost their revenue, or whether it's finding an investment group and saying, hey, we got lots of capital. We're a dentist with 20 dentist buddies, or, hey, I got these off market deal opportunities, et cetera. If someone wanted to get involved in the market at a high level, they could step into the market today with great groups by adding value that no one else can add by narrowing in on one of those segments.

Ryan Miller  

I love that. What would you say? Because you're really big on marketing, and I'm wondering if you could touch on that, because I know that's one of your superpowers, Nic, when you and I talked about some of the things, the non confidential stuff, but just some of the high level things that you do, my jaw drop, and I was like, Oh, Nic, Nic's running some business. Okay, so a big one that you say is we're very heavy on marketing and raising capital. Can you unpack that a little bit and just give some people some tangible advice, some competitive advantages that they can learn from you and all of your efforts in marketing, your investments in your company? 

Nic DeAngelo  

Yeah, I would, I would shift gears away from the real estate and think on marketing and a little bit different my background, just to give people an understanding, we built and sold three companies, one exit, three companies. We built and sold those together, and they were extremely marketing, Heavy Industries, extremely marketing, heavy operations. So our marketing budget per month just on ad spend, was about 125,000 per month. Okay, so I love marketing because I love growth. So my right hand person, my right hand guy, is a Marine who's super operations heavy. I'm on growth. He's on operations and we tag team different chunks of the business doing that. So if my goal, my job, my focus, and what I'm what the company, what I owe the company every single day is growth, I have to be marketing heavy. So there's you can high five each other and talk about the cute marketing campaign that you did that's not really marketing. Marketing at the highest levels is a data game. Okay? It is a data game. It's scale. It's hitting metrics consistently. It's what's performing. It's putting things to the market at scale and testing extremely heavily. I love that piece of what we do and and on top of that, the people that we get to deal with, especially on the investment sales side, are super successful. They're super smart. So the conversations we get to have are with an amazing, amazing, amazing community of people. 

Nic DeAngelo  

So what we do at scale, to give you an idea, is we are forced by the SEC. I know you know this, but just to recap, we're a Regulation D fund, which means we can only work with accredited investors, which means they got to make 250 or more per year, right? That's just loosey goosey. That's about what our regulation standards are. So there's a different tier of people that are making 250 or have a net worth of over $1 million and those people are also the people that we obviously market to and connect with. In the United States, there's around 22 million accredited investors, so at any given time, we have a database of about 50% of those. Okay, so I if you really marketing at scale, all it is is getting in touch with people and telling them exactly the data of what you're doing and letting them decide with the best foot forward.

Nic DeAngelo  

Okay, so if we have 50% of accredited investors in the United States that we have access to, our goal is to give them products that meet their needs, right? And so that's what we're doing at scale, and that's what we do at Saint at scale. And so there's a million different ways that we do to get there, but that's how we think about it, that marketing is getting in front of a large group of people at scale and putting in front of them a solution to a problem that they're having. What we found, because a lot of marketing is trend tracking and things like that, what we found in the US, just like we talked about the baby boomers, previously the most successful, the most wealthy, the most sophisticated. 

Nic DeAngelo  

People today are looking for different things today than they were five years ago. What the biggest trend that we've seen in the most successful they're looking for flexibility and stable returns. That's different than five years ago. Five years ago, they wanted the highest returns possible. No problem, we can tie our money up for five to seven years. No problem, we're willing to bet on a longer term basis. That's not what we're seeing today. We're seeing the most successful, the most sophisticated people want flexibility. They don't want their money tied up for more than a couple years, and they want above market returns. 

Nic DeAngelo  

So we put that as an income fund to market. We said, Look, we're going to give you a fixed return, and we're going to give you a ton of flexibility, half the term that most of these other funds are doing, but we're gonna pay you every month, right? You can track the income that you get from our fund. Whereas many people aren't paying their bills, they're not paying their investors out. So the market told us what it needed. Our sophisticated investors told us what they were looking for, and we responded by putting together assets that met their needs. So marketing, it's iterative. You put something to market, you get feedback. You put something out to market to meet the needs a little bit better. They tell you a little bit better what they need. And eventually we recrafted a fund to put together the income fund so that the product market fit was iron type or was airtight. So that's a little bit about our process, how we go to market, and also how the market benefits us by telling us what they need. 

Ryan Miller  

Brilliant. So marketing, when you're doing private deals, marketing, what's the end game? It's to typically find investors, and then secondarily, to find deals. But typically you got to find investors, and you're absolutely right. Check with your attorney to make sure that you're not violating any SEC solicitation rules. There are a bunch, just for those of you starting out, there are a lot of solicitation rules, so this is very important to make sure that you have that dialed in with the right finance team, the right legal team, to just make sure that you structure your marketing in the right way. But part of that structuring, yes, compliance, but the other one is, understand what is the end game? Now, I've heard it say that marketing is how people find you, and branding is why people choose you. And so marketing and branding is finding investors. Number one, finding deals. Number two, are there any areas that you can recommend to help people learn this game, if they're just jumping in, any areas for raising capital, marketing and just getting investors into their door? What would you say? 

Nic DeAngelo  

So the the re, we call it the retail investor space, right? You know this, but just a quick recap. So you have the retail investor space, which is everyday people that have some extra money that they want to put towards an investment. Then you go to the higher tiers, more institution you're going to be dealing with, like family offices, and then very large hedge funds, institutions, et cetera. Above that, we like the retail investors because we like working directly with individuals. They understand it a little bit differently. And frankly, we've been left at the altar by institutions where we don't trust them. Usually, they're the first ones out of the market and then the last ones back in. So that leaves the ways that we can operate in the market with what we do and we buy a lot below market, we buy off market deals. Institutions aren't as in line with understanding those different pieces as much as retail investors. So we love retail investors. 

Nic DeAngelo  

What I would urge newer investors to do if they're trying to lean into the marketing side or lean into the capital raising side, is understand the needs of who you're trying to raise money from. That's the number one thing because, I mean, you know, I have a guy on our team. He's, he's very, he has a very interesting wit on the marketing side, and he goes, let's not overcomplicate this. Let's ask people what they need and then give them what they need, right? That's that should be marketing product fit right there. So it's understanding what they need and giving them what they need. So we try to just stay as close to that. 

Nic DeAngelo  

But if you wanted me to get a little more tactical and just give people a big picture idea of what is very different than what what most people think marketing is no there is no you build it, they will come that doesn't exist, that is not a piece of any business in the entire world. It doesn't matter. In my opinion of business, it does not matter if you have the best product that's ever existed in the history of the world. If it's in a cave and no one knows about it, you won't be successful. Okay, so what does that actually mean in your marketing, you don't wait around. You have to go get customers. You have to go get clients. You have to go get in front of the people that you want to target. So a lot of people call that direct response marketing, just to use, kind of like an industry handshake term. That's the root of marketing that I believe is the most effective in today's environment. And it's simply a process, an advanced process, of getting connected with the right people and offering them the right solution for their needs at scale, right? And the scale piece is very important, because you and I, Ryan, we could call people, we have a rolodex of great, you know, people today. But what if we didn't? What would we do then? How to even find those people? Well, there's systems to that, and there's ways to do that and build that in, and I think that's what people got to build out in order to do this at scale.

Ryan Miller  

Brilliant. And what would be number three, what would be a third competitive edge that you can give people just to blow this out of the water, some of the secret sauce that you do to help you return that 35 to breeze and have 200 million under. Management, what's another thing you can advise people to do to really put some big points on the board.

Nic DeAngelo  

So if they were looking to have the highest return on investment on a deal, let's say deal by deal basis, our last seven deals, like you said, 35.5% IRR, I would say that what they need to do is focus on acquisitions, right? It's a really fun number to brag about. It's not as fun when you know the work that went into it, and how many you know, smacks in the face we've gotten by so many different things. How many nos, how many doors slammed in the face? But the numbers driven by the fact that we have bought off market, and we're the most competitive in our markets. So we talked earlier, you know, we talked about different ways to go, different ways to start off. 

Nic DeAngelo  

The reason that I told people to underwrite 100 deals and then go make the offers, is because they're gonna understand the second piece of that, whatever looks good on a spreadsheet is very cute. And you know, you have to know your numbers, and you have to be honest with yourself on those spreadsheets, right? But once you start talking to brokers, once you start talking to the people that represent those deals, the market will be real to you. And what I mean by that is, whatever you think is cute. Oh, well, if they just, if they just dropped the price half a cap rate, half a percent on the cap rate, then it could work. Okay well, go ask the broker, they have an opinion on that too. And it might not be what you think, right? So you learn the market by operating in the market in a big way, and then you actually learn things like, well, is it valuable to work with someone else? 

Nic DeAngelo  

What we see consistently? I just had this conversation recently, you know, our fund on one of the upper end offerings, offers, excuse me, offers 14%, 14%  & change. So we're talking with a guy, and he's going, so I own 32 houses. So by any stretch of the imagination, this guy's very successful in real estate, you know, eight figures all day long, long career. He, you know, he's he's very accomplished, and he goes, my average returns 8% I've been spending my whole life building this residential portfolio, and I'm hitting 8% you're telling me that I could hit 14% I could make 6% more, so nearly doubling my return by just investing passively, right? And he's offended by this to himself. He's not mad at us, but he's just like, I put my whole life towards something that actually wasn't the highest and best use. 

Nic DeAngelo  

So if someone's entering the market and they do want the best returns, the reality is they have to go off market. They have to because what's available on market, you're going to be this guy, and he's going to be really bummed to hear that the best year that he'll ever have is 8% on some of his investments. So at the end of the day, I would tell people making those relationships with brokers, putting in those offers, staying close to them, they will start to build relationships and maybe even get a look under the hood and see some deals that are off market and now they're getting closer to the higher returns on our side, I can tell you with 100% confidence that in the two markets that we operate in, on industrial that 80 to 90% of deals that hit the market we've already seen and said no to and if we say yes, they never hit the market, right? So, because we're buying them, so at the end of the day, it's, it's such a it's such a divergence of returns when you're buying off market. Because these brokers, their mindset is, we want the easy sure thing. So if we're offering, if a buyer like us, a competitor of ours, is offering cash in hand, because they know what they're doing, they have the money. They're offering a smooth purchase process, they don't bail out, they don't jerk them around on terms. They're very fair on things like inspections, and at the end of the day, has a high close rate. Why would that broker go to market to unknown buyers, right? So that's what I'd say. If you get close to the brokers and you want to be an acquisition specialist and get below market pricing, which means higher, above market terms, you got to be buddies with the brokers, the guys who are doing deals in your market. 

Ryan Miller  

Brilliant. You know, often, and I know you get asked this question all the time, as much as I do, is, how do you manage all this? So me, you know that all together, I have a portfolio of companies that I run which also own other portfolios of companies. And there's, there's many things that we all have to do, right? You're we're in the thick of it, brother, I know you and I really align on tracking data. Some people call an executive dashboard. Whatever it is. Call it whatever you want. You really need to understand what's going on under your feet, and as your your world scales your fund, scales your portfolio, like this guy with 32 houses, whatever it is that you're doing, hopefully you're growing, and if you are and you're not paying attention to data, you do run the risk of things slipping through your fingers or happening outside of your purview. Neither of those are good. So I'm curious, maybe you could walk us through a little bit about some of the data that you track. And what do you find important that someone managing deals, and even in your case, a company that manages many deals, what are you looking at?

Nic DeAngelo  

This is the difference between entry level, mid level and high level operators, is understanding your real, real drivers. Different parts of the business, we'll call them activators. They'll say, you know, KPIs, they're key performance indicators. They'll say, these, the activators for success. If we hit above these metrics, then we're going to have a successful this, that, or whatever, a downstream effect, our KPI tracking, our data tracking, is ridiculous. Okay, we go through it as an entire team weekly, and we start the week with it, so it's Hey, how'd everyone do last week? Ooh, this person sucks. This person's great, right? We're very open about it. We're very, very clear about it, because at a high level, It all affects each other, right? If expenses go through the roof, well, net income went down, right? That's basically the oversimplified version of that. If the leads are bad, then investment sales go down. Right? If the sales team isn't doing great that week, then there's less capital raised. So we can't do as many deals, you know, it's so each piece of the entire machine needs to be operating well, so we're extremely clear on that. We do have the executive dashboard, that's our first we call it our laser focus. It's our top 10 variables that we're looking at, our top 10 data pieces that we're looking at, and then we department break down what their benchmarks are for the different key performance indicators. That's how we manage it. 

Nic DeAngelo  

To give you an idea what I'm typically looking at, personally, from where I sit, I'm managing two different directions, right? So we raise a lot of capital, or capital allocator as a major part of our role. So capital raise and capital capital deployed, or a constant seesaw, right? If we raise too much and we don't deploy it, the cost of capital goes up because it's not getting a return. So that actually puts us in a position where our net returns go down. And if we deploy too much capital, then we don't have enough for big opportunity that's going to come by where we could get even more below market opportunity and boost returns. So it's a seesaw, right? That's a balancing act, and we have all the metrics and the data of where we want to be in that for our perfect balance. So I'm looking at Capital race and capital deployed. Those are two things I'm regularly looking at as a capital allocator. I'm looking at, you know, our financial statements, our income statements, our cash flow statements. I'm also looking at our agings, our receivables, our delinquencies. Every single week, I want to know which tenants or which mortgages are not paying and what that equals to, you know, that tells me things like how much cash is coming down the pipeline after a period of time, and how asset management's doing on collections. So a lot of my data, to be clear, is focused on the dollars. It has to be right for me to be doing my job best. It has to be dollar level on most categories, right then, you know, we look at the metrics. You know, we look at year over year, month over month, things like that, for the key department indicators. But this is at a level where we have the people, the right people in the right chairs. So I'd say early on. I mean, your data tracking needs to be great. You have to know what's important for you, but also as you grow, the reality is you need the right people in the right chairs to even be able to enforce benchmarks or KPIs that your company needs to be doing. So I'd say your hiring process is the backbone. Your hiring strategies are the backbone of growth, of data, of performance, because having the best people in those positions allow you to zoom out and look at the performance of different departments. So I'd say those are the two layers that I see most intertwined. 

Ryan Miller  

Brilliant. So as we wrap things up, any closing remarks, any final thoughts that you'd like our fans to know anything at all? 

Nic DeAngelo  

Yeah, I would say learning is so key in this space, right? And understanding there's, there's all kinds of different opportunities. And what I'd leave people with is two things. One is get around winners, because the learning curve being around winners and being able to ask questions and being part of groups where people are absolutely top tier, there's nothing like it. There's nothing like it. So I personally would pay immediately to save my time and save my learning curve and I recommend people do the same. At Saint, we offer no classes. The only thing we offer is co-investing. You can invest with us in our funds. I just put in half a million dollars of my own money. So that would be the second thing I'd tell people, is learn as much as you can. At Saint, again, we offer no courses or anything like that. I'd recommend if people wanted to jump in a group, they check out a group like yours, and get around a network like that. And if they want to learn, people give a lot away for free. So we give away on our site all of our data for free. We look at all the market stuff. We break down in 90 minute webinars, the things we're seeing in the economy, the different strategies we use. I tell people to check out saintinvestment.com/resources, and they can see all of our webinars. They can find our economic data trackers that see every month what each market's doing and how the economy is doing worldwide, in the US, et cetera. Those are the two get around freaking winners, because they will sharpen your learning curve so much and then absorb the best information you can to understand the market we're in and stay close to the economics of where we're at today. 

Ryan Miller  

Absolutely brilliant and it's been great having you in a lot of those groups in The League and fundraisecapital.co. Those are all many things that we teach on our side, and the Making Billions community is growing, it's thriving, people raising money. And Brother, you are the king of the castle, and that's the case. So just to summarize everything that Nic and I talked about, hire the best team to 10x your success when building deals. That's number one. Number two, get your marketing dialed in, for goodness sakes, that's how people find you, and get your good brand, which is your reputation, make sure that they choose you when they find you. I've never seen deals take off without capital, so you must get capital or go down with the ship. Now, so like I said, shameless plug is you can join my course called fundraisecapital.co to level up in your fundraising game. And finally, track your data, if you can't measure it, you can't manage it, you do these things, and you too will be well on your way in your pursuit of Making Billions.

Ryan Miller  

Wow. What a show, I hope you enjoyed this episode as much as I did. Now, if you haven't done so already, be sure to leave a comment and review on new ideas and guests you want me to bring on for future episodes. Plus, why don't you head over to YouTube and see extra takes while you get to know our guests even better and make sure to come back for our next episode, where we dive even deeper into the people, the process and the perspectives of both investors and founders. Until then, my friends, stay hungry, focus on your goals and keep grinding towards your dream of Making Billions.