Sam Primm: Going from Zero to $25 Million in 18 Months using Real Estate Investing

Today, I’m excited to welcome Sam Primm to the program. He’s here to reveal how he built a $25 million real estate empire in just 18 months! Sam dives deep into the strategies that turned passive income myths into tangible assets. He shares his unique approach to mentorship, education, and offering real value in the market. Discover how focusing on long-term wealth and societal impact through real estate can lead not just to financial success but also to profound societal contributions. Join me as we decode the secrets to real estate success with Sam Primm. Welcome Sam, to The Gould Mine...

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Transcript

•  What's up gould miners today. We welcome Sam Primm to the show so that's the thing passive income's kind of like a myth. It's not a real thing cuz you're always active at some degree. So I own. Everything 50/50 I have a business partner that owns the other 50% I own 50% I wanted to own it all myself and control. Over everything it would never be passive. We're cash rolling 40 to 50 Grand a month on 50 million in real estate. Like that's like okay. But in general we could cash FL a lot more most of the time. There's some level of involvement and that still doesn't mean you don't do it. I'm not even if it's 10 hours a week still buy reyolds good Lord that's how you create. Wealth. Sam is an incredibly experienced real estate investor entrepreneur educator and now social media icon. Over the last 10 years Sam has 1,000 houses slipped 150 single family homes owned six apartment buildings. Three storage facilities and one hotel needless to say Sam is the real deal and in this episode we cover a wide Gambit of topics starting with the journey and the lessons that he learned in doing over 1,000 flips over the last 10 years later on. In the episode we explore the idea of mentorship and paid education especially now in the modern era and how paying for experience. Impr proven processes can help expedite and shorten your path to success. We also spent some time talking about his corporate structure how he delegates his hiring processes. We go really in depth in this podcast and there's definitely something in this podcast. Whether you are a brand new investor or a super seasoned investor and finally we end the episode by talking about some of the trends that he sees happen happening in real estate currently that will affect the market for the next 5 to 10 years including his thoughts on midterm rentals that's right not long-term rentals not shortterm rentals but midterm rentals and how he sees this as a golden opportunity over the next decade again so much wisdom so much knowledge in this episode and I can't wait for all of you to listen. This knowledge packed episode so without further Ado everyone. Let's welcome to the show Sam PR Sam welcome to the gold mine I'm excited to be here my man D this is great uh obviously been following you for a little while here and and I know your story but for the audience. Just a spark nuts version of Sam's real estate. Investing Journey went from zero to $25 million portfolio in just 18 months. How'd you do that I mean so yes. It's one of those things where so we bought 25 million in real estate in 18 months. So I got 50 million in real estate. So I think that's part of the story is um. You know it doesn't happen overnight. You know we were able to get quick growth. We took advantage of the low interest rate environment right before interest rates popped off and um you know high high cost and you know or high value environment so there right before interest rates went went off. Like crazy. We were able to add that 25 million in real estate and it's because seven years prior I had been doing things and building relationships and and doing loans and and and you know talking to lenders and talking to contractors and Brokers. So it was one of those things that was kind of like a culmination of several years of work. Because a lot of people think well you know no one's going to give me millions of dollars of loans well not me either like. It starts out with $100,000 loan and then a $200,000 loan and then another $100,000 loan then a $500,000 loan so it's one of those things you build over time so definitely didn't happen over aight but what you're referring to is. Yeah was able to was able to add 25 million there in about a year and a half there before each stay kind of dipped and we took a little break by and but it was a culmination of a lot of things. So what you're saying is that it didn't happen overnight. Sam it it. It happened over two nights yeah yeah well and that's funny right because like obviously you see that that's the headline right like that's kind of like the attention grabbing headline. But what you just alluded to. I think is the fact that most people tend to avoid when talking about. Anyone's success is the years of work that happened before then to get to that point because even though maybe you work in invest you were you were doing other things that were building that foundation for you whether or not it was directly in that field. So let's talk about what you were doing before you got serious about investing what what was what was that like yeah so it was. I graduated college in 2011 um and was doing the job thing all the fun W2 corporate stuff and then 201 uh like 13ish. I liked my job okay. But I I wanted to explore some other things so me and a buddy started investing on the side in 2014 and we started out with one single family rental in like 20145 time. Frame then started to build upon that build our skills learn a lot of things and then by 2018 we quit our jobs and went all in on real estate so then from 2018 till now it's been um a majority. 95% of the 50 million in real estate that I own probably has been over the past um you know seven years is six seven years but it started you know slowly with a full-time job like most people do um for the first few years. That's awesome and you were kind of doing it on the side with the Buddy and everything then you really got serious about it. I'm wondering you know in the time that you were. I wouldn't say like half in half out but like in the time that you were building right like not like doing it full full time. What were the the the two to three pivotal things that happened in that time. Frame that you think build that foundation for you because there had to have been a couple of things that happened in that time. Frame that built that foundation for you yeah. I think it was a couple different things one of was gaining confidence. We had been doing you know you know like I said from like basically 2015 2018 so three years on the side so a couple of things um kind of opposite directions. Too one of them was building confidence. We had bought a decent amount of real estate done. Some flips done some Wholesales and started to have the confidence that we could do this and maybe quit our jobs and lose the security of a job and bet all on yourself. So I had the confidence being built up. But then I had a boat anchor the job at the same time right. So I had the confidence and then I saw what what I was able to do in 10 15 hours a week. What if I had 70 hours a week to spend on this like can this extrapolate times five just simple math time in uh you know output out so there was that side of it the confidence and then like the wh ifs of like the boat anchor kind of being you know being. You know the job being like what could I do if I had more time and then finally I think it was. We we screwed up several times and were able to like navigate and figure it out and not lose our butts and you know be able to you know take clad off one property because we lost it. On this one or you know had profits built into one deal. We lost on another one so we were able to kind of get like a home runs and you know you know strikeouts all in the same time and still remain afloat. So I think we just had you know screwed up enough that we're like all right. We feel like we're confid confident comfortable enough that let's take our family livelihoods and depend on ourselves not on somebody else. I love that and and what were what was your boat anchor. What was that 9 to-5 for you um I was uh in Sal. So I had a little bit experience by selling Caterpillar construction equipment is what I was doing. So I was in Sal traveling a little bit not a ton but just um you know not able to be around like you know where I was investing as much. I want to come back to that because I think at some point we're going to kind of get into what you're doing now and you know raise. Capital all that good stuff and then how sales is kind of tied into that. But we we'll get into that in a second love that you started off using the bur method primarily correct you were doing yep okay awesome and for those that might not be familiar with it. Um. Bur stands for buy rehab rent refinance and scale not repeat. I changed it to scale buy rehab rent refinance and scale love. It love it as scale and we're using that primarily for single families uh to start with what were the what was the buy box at the beginning right like what were you looking for what was the typical uh deal look like at the very beginning we were looking for houses to flip to put 20% down on rentals because I didn't know about the bur method when I got started. So I tell most people like after they listen this podcast. They're going to know more than I knew when I bought my very first rental property um but my goal was to buy a house flip. It take the profit and put 20% down that's what I thought you had to do and then during the first property. The rehab actually found out about the burs method and the refinance and was able to keep that property. I still own it today but uh typically the buy box was in St Louis. At the time was houses with an arv between probably like a hundred and $200,000 um. You know was able to get obviously less than that and buy at discounts but 100 to 200k arvs and proper their cash flow. You know three 400 bucks a month um. After all expenses. Kind of thing was the typical buy box for rental properties. Now uh we rented other properties that didn't fit that buy box that we would you know wholesal or flip and try to try to you know make profit on because that was the one of the bigger mistakes we made at. The beginning was trying to replace our W2 income with rental income and if you buy Ryals with the bur method and you don't cash flow a ton that's an uphill battle that's not likely to to be one within a decade or two. So we quickly figured out.
•  You had to have active income and passive income at the same time. That's when we started rolling in you know flips and Wholesales to replace the active income gotcha. So we started with Burr that's actually very interesting right because I feel like a lot of people start with wholesaling and then they graduate into flipping right and then they're like wait hold on a second this is such a transactional business and I'm not building any like long-term wealth. Let me get into burring and like you know buying holding so you actually did it in reverse which is which is actually fascinating. Uh any advantages that you see to doing it that way as opposed to the other way. I mean the first house we bought uh. You know what 10 years ago now about not quite you know. It's got 160,000 in equity and one house that we bought used none of our own money. So there's that part of it right the actual numbers of starting earlier because realate doubles in value every 15 years. So the earlier you buy it. The earlier you're going to double y your your your um values so there's that side of it. Then I think just like learning the relationships like I feel like taking it using somebody else's money fixing it up getting a bank refinance that's way harder than wholesaling or flipping. So I feel like I got the hard part over with yeah. Flips and Wholesales seemed pretty easy at that point right just like no I don't even have to close on this thing and I can make 1520 Grand or I'm rehabed and um you know I I can you know try to do Cash out refinance or I can make 60 Grand and keep it or and and sell it kind of thing rather than keep it. So I think the advantage was that I did the harder thing first and the other things seemed easier. But again the disadvantage was we. We were idiots and tried to replace our income with $200 a month rental property. So it took us a little like a couple years to realize that but then then we did and then we kind of went all in yeah. That makes uh that makes a lot of sense and and you know. It's it's fascinating because I think a lot of people get sold this this idea of passive income. They get sold the idea of passive income and and you've been able to achieve that now I I believe the number was somewhere around like 40,000 right a month that you've that you now collect passively uh from my rental portfolio yep. And that's that but that's over50 single families. Six Apartments three storage units in a hotel yep so yeah so that's so that's the thing passive income's kind of like a myth. It's not a real thing because you're always active at some degree unless you do what I did and it's truly passive but you give up profit and and you know you give up Equity or you give up you know cash flow like if I wanted to like own everything. So I own everything 5050 I have a business partner that owns the other 50% I own 50%. I wanted to own it all myself and you know have like control over everything it would never be passive. But I haven't been to a rental company meeting in 18 months. So it's passive. I don't even know when I buy rental properties anymore. So it is truly passive to me. But we're cash flowing 40 to 50 Grand a month on 50 million in real estate like that's like okay. Like that's not super like that 50 Grand mon a lot of money right but like 50 million in real estate versus that people are like that that doesn't even make sense that you think you'd be cash flowing. You know 600 Grand a month or five like they have no idea yeah. But in general we could cash a lot more but we have a team. We have an in-house property management team. We pay. We have a a COO that runs that company we have office rent that we have a nice office in we're growing in skill and we use none of our own money so so when you do that when you use none of your own money and you grow in scale. You do sacrifice cash flow and if you don't if you're not involved at all you're going to sacrifice cash flow. We pay our COO of our property management company 110 grain a year like Lucas and I could try to piece that together and get more cash flow but yeah we're not worried about the cash flow. It's more about the appreciation The Debt Pay down the tax benefits so it is truly passive for me but that is pretty rare. Most of the time there's some level of involvement and that still doesn't mean you don't do it. I'm not even if it's 10 hours a week. Still buy rentals good Lord. That's how you create wealth but right. It's actually passive which is a little bit rare well. It's interesting because you know I so in a previous life. I was a a realtor and you know grew up a real estate team and and what you know one of the pillars of my business was like helping Real Estate Investors and Silicon Valley Bay Area first of all like buying rental property. Here is like really stupid really really D you're not cash flowing you're in the red uh. There are some people who's who who timed it well kind of like earlier on uh coming out of the recovery they made millions of dollars but um especially right now. It's like you there's no such thing as a real investment property here in the Bay area. But I always got people that came and said you know I I want to invest right but then they didn't want to hire a property management company. They didn't want to like even hire a handyman they're like oh. No I I took care of it and I did this and that and and then you I had to go clean the you know or beat the plumber one day and I'm like dude like what do you do you just bought yourself another job. Right so yeah it sounds to me like you oh. You did everything backwards but in a but the right way right. It's like okay I I built I built it from the top down. Not the bottom you know I built from top down bottom up who talked about this someone else uh. Heros talked about this recently where he's like hey you know like two ways to do it either from the top down. Bottom up Elon did it top down started with the Rolls-Royce vehicle then built his way down um as opposed to like bottom up and as a result you were able to buy your time back over time and now you built this awesome like business right. Now truly is a business you're like actively still involved but not to the point where like if you left for two weeks it couldn't run without you. I'm assuming that that's what you mean right like You' go to Barbados tomorrow and like it would run pretty much without you oh the one of my companies. Yes so three of them. My rental company could run without me ever being here again like I said I don't I haven't been to a rental. Like so we have our we manage our own assets. So we have an in-house property management team that manages our assets and I haven't been to a midus property group that company I haven't been to a midest property group weekly meeting in 18 months. Maybe almost two years now so wow the last 50 single family houses. I bought I couldn't tell you the addresses. The numbers anything so that business is truly passive and I don't have any involvement at all in that business. If we're buying an apartment complex. Maybe I'll come in and help negotiate or raise the money but and that's that's kind of rare these days because the cost of money right now so we haven't really been buying much besides single families recently so yeah. I'm not involved at all. I'm very involved in the education business um and then the flipping business. I'm a little bit involved in but my time splits probably 90% education 10% flipping and 0% of uh rental portfolio so yeah. That's a it's a real company that runs uh without and I'm I'm happy for that now when you say education business. Let's talk about that real quick you are educating other Real Estate Investors correct okay yep exactly and it's called Freedom Network faster Freedom y faster Freedom sorry faster Freedom where did I get that from uh faster Freedom so faster Freedom. Let's talk about that for a second Sam so like what what does faster Freedom do what it you know what does the structure look like and what can someone expect if they come and like say hey. I'd like to join sort of thing yeah. So faster Freedom started uh just kind of this online education via social media. In 200 19. I remember specifically um seeing a lot of people in starting getting the education space that had done like five burs and they wrote a bur book or had like done four flips and and has one Airbnb and they do Airbnb master class on a weekend. I'm like I mean. At that point I had probably 25 million in real estate and had done probably six maybe 500 flips and like I don't feel like I'm qualified to teach people. But I sure as know you're not qualified to teach people. So then I started to post a little bit about on my personal uh Facebook and people like my bananas about it like high school buddies college buddies friends. I didn't like I didn't know you were doing all this because we didn't talk about it right um. So I was like holy crap people like this. So then in 2020 summerish 2020 um I I started posting on social media you know Tik Tok YouTube Instagram and started to just after a few months started to like holy crap the the neede. The eyeballs for somebody teaching something that they're actually doing is like Earth shatteringly crazy to people because all these fake gurus or people flexing from cars or rolls-royces all the stuff yeah I was actually doing it. We buy 200 houses a year. I was adding rentals like crazy we were screwing up. We were doing well all these things and I just talked about what we did and that was like a Brand New Concept for social media somebody authentically talking about what they actually do. And that's how I've gotten 3 million followers on social media which is the top of the funnel just by talking about doing what I do like I'm not like super well spoken like goodness gracious. If I had harosi articulation skills that would be crazy or like a cool voice or I mumble and I slur and I talk too fast like I'm like the opposite of what you would think. But I have three freaking million followers because all organic none of them bought none of them paid for because I just talk about what I do and I'm authentic about it and I'm not buttoned up and people like that yeah. So it started there kind of grew that and then as I got more eyeballs more people were like hey. I want you to teach me and Coach me so of course. Like 2021 we launched like a 10-week program. It did okay tried a few different things but then about 2022 we got our current like Community mentorship figured out after like three or four iterations and that's what we've stuck with for about two years. Now we got six. Uh 1700 students now all students in all 50 states um you know over 200 million owned by our students all in the past couple years. So we've really hit it pretty well because the deliverables and what they get for being involved. So I give a right I don't know if I can cuss I gave a crap ton away for free via social media. Um via you know trainings and things like that and then um if they want. They're handheld. They want the community. They want my big my big pitch if you want to call it. A pitch is I've done over a thousand flips and Wholesales I own 50 million in real estate.
•  I've screwed up a ton. So I have systems processes checklists. Sops everything around it like I can give you my system to start from scratch. So you can follow a system. I always use the analogy of Chick-fil-A people get Chick-fil-A franchises because of their systems. Chick-fil-A is so well done that high schoolers run Chick-fil-A because their systems. Of when to do it where to do it what to say at the drive-thru how to direct traffic when to open up a second lane where to make the food when to bring it in. It's like literally you buy it in you're golden yeah and you can have a high schooler run it. That's what my systems are. You can try to figure it on your own and open up a chick joint next to it. Uh by leasing space at a strip center or you can take systems and use them so which one do you think is more profitable and quicker and less frustrating so that's kind of my whole Spiel is. I have the systems I'm continuing to do it. I'm screwing up all the time. Let me show you the systems let me hel hold your hand with the coaches and let me give you the proven processes for the path of least resistance to wealth pretty pretty pretty captivating pitch like you're going to still have to roll up your sleeves and work hard you're still going to screw up. But we're there for you. We'll keep your momentum. Going. We won't let one screw up add to two to three to four till you're done. We'll let one screw up add to a fix and then we'll grow again. So that's my whole thing and that's why never thought I'd be on. Tik. Tok never thought I'd have two million followers. There never thought I'd have you know 15 20 million views. A month on social media never thought i' have 1,700 students. But it's all kind came from me talking about what I'm actually doing on a day-to-day basis um and so anyways. There's a long ass answer for your question but in general it's really cool. It's what I spend most my time on. I'm super passionate about it because it's helping people. It's another stream of income for me and I feel like I'm just getting started on like where I could take that and the things I could do. I don't Syndicate. I don't raise funds. I don't get deals from it. I I think I can do that in the future but right now. We're just providing value and you know picking up the people that want their hands help that's awesome man and you know what in life you're going to pay for things. You're either going to pay for it through time and experience or you're going to pay with it with with with dollars right and uh yep. I believe in mentorship so much man um and and good for you like. I'm really uh happy to hear that like you figured because like I know exactly what you mean the more that you know the more you realize how like inept you really are and so it doesn't surprise me that you felt like dude. I've done 500 flips and this guy is doing done like four and like he and you felt like you know super unqualified. But it's really funny because like I feel like the most qualified people are the ones that feel like the least qualified you know um and so yeah yeah yeah to be successful. I feel like you have to have like some sense of awareness kind of to a certain degree and and have some perspective and I see a waveing and there's um and I mean I spend I spent aund. I spent 150 Grand a year on masterminds and education programs and teaching and coaching so it is something the industry does have an icky feel to it kind of because of certain people in the industry yeah. You know there's hundreds of courses and mentorships out. There. There's about 10 good ones um but no I used to like I I put my money where my mouth is like. I said 150 grain a month or not a month a year that I spend on on being around people that are bger better and more successful than me yep and then just happened. Twice. Now spend 20 green a year get in a room like kind of nervous and shy and looking around and build yourself up and build a reputation. Now you're kind of the top guy in the room. What do I do I leave that room and pay um but now I'm proud of it. It's it's an incredible course. It's a $10,000 course that teaches people how to become multi-millionaires efficiently like I'm happy about it. People that get involved and take action are like I would have paid five times. This or I've got 10 times the value. So it's not something. I shy away from anymore. But I I did for a while because of the um the stigma of the space but that's all right everybody has their own path. Well you know and you said something right there. That is so true that a lot of people. Overlook it's like all right assuming and this is a big assumption and the truth is the sad truth is is that right now with the internet I would say that like a good portion I don't know if the majority but a good portion of the online education out there is is garbage but yes if you find portion ex yeah if you find someone like Sam who's done it who has the proven processes who has the track record can help you avoid crapload of mistakes along the way uh your still going to make mistakes by the way like it's not going to like that you're still you're still still going to mess up the only thing keeping you from reaching levels of success like Sam is yourself meaning your lack of action and implementation right and so you just hit it on the head right there because of the 1700 students that you have I would wager that less than 150 of them actually Implement what you've tell told them to do cuz this just like you know there's so many people that like will buy it. And they that it's like entertainment for them. But then they actually won't implement the steps and maybe. It's more than that right. I'm just saying but like the like just from like a a sheer percentag is like you have you know you have a 100 people and then like maybe 10 people will take action on that stuff. But like that's who the education is for. It's like. It's for those 10 people um because they're the ones that are actually going to do the things that are required that are necessary to win right and like you're you're 100% right yeah. I feel like we are very intentional with our onboarding and we had we have a call every day. We have um accountability calls. We have follow-up calls. Check-ins wow so I feel like we're the best out there and I'm not like trying. It's. It's like a good thing because that I don't get more as people are more successful. They they pay and then they're done so um but it is really really cool because I feel like we're probably you know your. Numbers are close but we probably have like 3 50 to 400 active members. So you're you're right. Though there's 13,400 not so you're 100% right I just was saying even being probably the higher percentage of active members of anything out there. There's still you know whatever the math is there's still 60% of people. 70% of people not taking action so anyways you were right you were your whole. Concept was very very well spoken in that even having it and people paying there's still a very small percentage to take advantage of it. My goal is just to make that percentage as high as possible yeah because I just was saying I've noticed and this is something can get into. It's very very uh cool for for me. What I've noticed is um the more I worry about providing value and providing Solutions the more money I make as opposed to chasing money. I had this conversation in 2022 that completely changed my life with two. I had two conversations with billionaires six months apart and they said the exact same thing they didn't know each other. They didn't even know they were talking to me and they I felt like I was in the Twilight Zone I was starting to believe the Matrix. Like is this the Matrix. Like what is going on. This was so weird there were two billionaires. One of them um is like a billionaire hedge fund manager. The other one um started priceline.com and a few different things and they said almost the exact same thing and it changed my life. They and I was like these people are are are billionaires be because they're special. They're not special because they're billionaires if that makes sense and they're like money flows through Society. They both said this it's not good. It's not evil and it goes towards those that provide Solutions and those that actually try to help people like most wealthy people are really really nice. I know the internet wants you think wealthy people are wicked and evil. But a majority of people are wealthy because they're good people. That's why they're wealthy and they shifted my focus as I want to own all these businesses and have all these side hustles and have the streams of income coming in where I'm making so much money. I don't know what to do with yes. I'll give to charity yes. I'll do that like great I want to make money for other people and me and I was doing okay. But I had these conversations in 2022 and I started to shift my mindset and I started to say I to provide Solutions over money. I want to help people over make a profit and I didn't really believe it right away. I said it enough. Eventually I believed it. I'm telling you like six months is into that like I wasn't worried about money. I don't check my bank account that often and then when I do. It's like I make more money not that I know what to do with goodness gracious. I'm not there but make a lot more money than I ever thought I would make because I stopped chasing money that takes discipline that takes effort like think about like I want to be better at something so.
•  I'm not going to do it like that's really hard to do that's the opposite of what logic talks about in most things and as soon as I actually embraced it. It was like like the waterfalls opened up. That's hence the I mean. We didn't always charge 10K but you can do the math at our students and you know so. It's just wild where that comes in when you actually try to provide solutions that help people and give away as much as you can for free and then if you want the implementation to the education. I'm here if you just want the education take it you want the education implementation we're here for you when you need us kind of thing so anyways de mean to go on a change. It you just kind of sparked that as like the shift that really really helped uh helped a lot of people and me like I got I get make more money too. But it's not really about that that's just a byproduct of it yeah it's fascinating and and so money flows through society and it goes tends to flow towards the people that help other people and that makes a lot of sense. I mean I mean ultimately like you get paid to solve problems right. Uh that's everyone gets paid to solve problem employees. They gets paid to solve the time problem because there's not enough time for you to for the CEO to do every single task um and so they get paid with the time problem. But everyone gets paid to solve problems and the more problems you solve the more money you get you make I do believe that as a real estate investor though because I'm curious right because now you're we're kind of getting into the education space right. Uh they we're talking about education and you solving problems in the education space and to me. It seems like it's pretty easy to understand problem solution in the education space right. There's a lack of educ. There's a lack of knowledge and so you're providing a resource you're providing a road map for them to kind of get to where they want to be. But let's talk about real estate investing for a second right. So like what are the problems inherent problems that you're solving as an investor that have allowed you to make the kind of and and have this amount of success that you've been able to have right like what are the problems that you see that you have been able to solve yeah so the I mean it's. It's huge I I didn't realize this again growing up thinking that uh real estate investor or people that have money just gobble up houses and they put cash down. They use they're already rich and they pay cash. I didn't realize the Need For Real Estate investers if there weren't such thing as landlords which I know they get a bad name on social media. At least my comment section say that they do um my DMs um and uh you know they think like we're taking away housing. Supply like there's a there's a housing Supply shortage and you're taking the housing. Supply shortage and you're profiting off of shelter you're profitting off. Essential need you're an evil person and I hope your family. Gets can direct quote from DMS from me. So not everybody understands that but once you understand it and it's just lack of knowledge. It's just lack of it's just lack of understanding. So what I do and here's where the solution goes in. I take a distressed house that somebody cannot live in a bank will not fund a property that needs work that's why there's hard money and private money in cash banks will not fund distressed property so if I don't buy that distressed property and fix it up and rent it to a family that wants and needs to rent or sell it to a family that wants and needs a house. Then that house is literally going to just continue to Decay and all the houses around it are going to lose their value. This that's the key thing is Real Estate Investors. For the most part there's shitty Real Estate Investors there's shitty landlords of course y but in general the good ones we take distressed properties that are not a part of the supply and we fix them up and make them a part of the supply so in fact the person and persons by the way that have messaged me that before they just don't understand it. They think I'm going on Zillow and paying cash for the house that's lives next door to them. That's going for sale in the market that's in perfect condition. There's no profit in it for me that's a failing business model. So my business model is distress properties that the bank won't fund nobody. I'm telling you nobody who wants to buy their first house has the money to buy. Cash has the connections to rehab. It has the knowledge or time to make it livable and pass occupancy and code in these things. So that's the whole value solution that I provide I take distress assets that are out of the supply. I insert them into the supply by selling them to somebody who's going to fix them up wholesaling it. I fix up myself and keep it or sell it. Uh sell it as a flip. So it's it's a very very needed uh solution and of course. There's these hedge funds and all these people that kind of do it the wrong way or some people. So there's a ying and yang to everything but in general majority of people do it. The right way are without them. Our supply would be even worse condition because home builders aren't building fast enough uh uh to get the supply caught up as you probably know yeah and you know that's a great point right and this is something that I think is highly overlooked by you know people that say oh flippers or whatever right because there's there's all just like anything right Sam. There's always going to be like the negative ncies out there that always find the bad in the situation. The people whatever but a lot of these houses are really unhabitable right like they really just like would not be able to really are you'd be shocked and you're Bridging the Gap because here's the thing right like and I can speak from experience here as a real estate. A former real estate agent 80 to 85 5% of the clients that I worked with right out. The bat said that they needed something moving ready MH and of the 20ish percent or so that said that they'd be okay with something that wasn't TurnKey that they'd be willing to do the work. 90% of those people were lying orions most of what I buy is not even livable like there's like water's not on. It's like not even. It's not even habitable exactly right so and right exactly so like and we're excluding those right like. We're we're excluding those from even the picture because like yeah those like foundational issues structural issues uh Plumbing issues electrical issues things that like really truly um holes like oh my gosh Sam. There is this one I'm not even going to go into it but like I have seen and I'm sure that you have too right like I've seen some dude like out like dude like you know crack houses meth houses like these things exist and like people like you bring them back. Uh you restore them back to like what they were intended for which is like you know shelter. But it's interesting that you that you say that because you know Real Estate Investors and when I say investor we're really talking about flippers right people that flip houses or or people that that renovate properties um not commercial and all that stuff we'll get into that in a second but there really is a service that is provided there. That people do do not fully comprehend um because all they see is like oh. This person made x amount of dollars like you know screw up. It's like yeah but you took on a lot of risk a lot of responsibility and provided a lot of value as a result of that yeah. I mean put it this way a majority of the houses. We buy we sit down with the home seller and I used to so. I used to before I got the education. I ran the flipping company as far as like the marketing and sales go right. So I was in houses and training people to be in houses and things and uh what I taught people what most of our successful buyers do is. They go in the house and they show the seller like hey. What do you think your house is worth fixed up all right not let back in the numbers. What do you think this kitchen costs 20 grand. No. It's not a 20 grand probably 10 grand kit like we like be honest with them show them the numbers show them our profit March and be like this is what we'll make we got some fees to pay. T like this is what we'll bring home and they're like yeah. Like you know we understand. It's a business profits not a bad word like they don't want us making a 100 Grain on a $100,000 house. But if we show them where the profit actually will probably end up yeah and like maybe like things we lose money on deals once a month maybe maybe every other month like not you know we do a couple hundred transactions a year. So you're gonna so we don't always even make money so just showing them. The transparency of what the numbers actually look like um and and all the fees and all the risk that's involved like most people are completely fine with it and they're selling their house or their parents house um and they're the ones getting the check somebody on the side that's pissed about it. They don't even it's not even their money. They get more mad than somebody actually getting the money because they see the service we provide. They don't want to my sister lives in New York I live in Chicago um you know we got a nephew in St Louis. We're all going to meet one weekend. We got to get this house gone get it cleaned out. We want to leave it. How it is you take all the stuff you throw it away. You know everything and then just take it off.
•  Our hands be done with it and you know what's a fair cash offer. We show them the numbers here so we can offer okay good like that. That's that's what the service we provide is and it's very needed 100%. And just as a a caveat here or asterisk and then we'll move on. But what Sam just shared. There is a genius way of selling to um to anyone really. It's just full full total transparency because a lot of times when you kind of see play the don't look at the man behind the curtain. Uh selling strategy usually ends up backfiring because they actually think that you're making way more uh than you really are and so I actually have a buddy here who sells real estate in the area. But he has a a contractor partner and so they'll go in on deals 50/50 if they um and flip them if if the seller just wants like a a cash offer and he'll show them like the the difference like hey like if we put it on the market. This is what we'll get probably right like this is the range but if we buy it this is what you know we'll buy it for and then this is what we you know project. The arv will be and this is what project our our renovation costs are going to be and he has FL you know he has gotten so many flip opportunities over like the last year or so that he's been doing that and he really just started doing that. But I'm like dude this. That's you know that's brilliant and uh you know especially here in Silicon Valley like you do a couple flips a year. You're you're good you're doing pretty well um so so. It's interesting that you guys also take the same approach that leads me to my next question which you you mentioned this earlier and I wanted to get um. I wanted to cover it. You said the last 50 homes that you've bought you haven't even looked at you. Don't even know what the address is. So how did you scale to the point where you got where you got comfortable enough to trust someone else with that decision making what is the process that you've used to kind of like because I'm assuming you've trained them and everything but like I mean gosh that seems like a lot of responsibility to put on someone else's shoulder yeah. So there there's a couple things one of them um is having like a a a good business partner like I said earlier Lucas is my business partner. We've been friends since uh middle school high school college bar fights the whole the whole the whole nine yard right. So I have immense trust in him and we kind of have. We decided about two years ago to divide and conquer. We both still own 5050 of everything but he focuses on the rental portfolio CEO and then the flipping Company CEO and both of those companies have very very very capable coos. So Lucas is able to focus on Topline Visionary stuff for our rental portfolio and our and our flipping company and one person reports to from each company and he kind of guides the light and they do the day-to-day and boom. He's. Able to kind of focus on the bigger stuff I focus on education company and the finance department actually rolls up to me surprisingly. I I um have a a a desire to kind of see. The numbers and kind of Hope point the financial direction of our company because we have a CFO a COO and and a couple staff accountants so we have a decent size accounting team for all the transactions we do so that's part of it is having a partner that we divide and conquer like for a while Lukes and I we're going to all the meetings together. I'm like what's the point we're just wasting both of our times. I trust you you trust me so let's I don't need to go to this meeting. Like um. We don't. We agree on most things if you're super passionate about it then freaking do it. I don't need to know about it and he does the same with me. So that's the first part of it. I think the most important part is the right partner. The Y your yang that you have the core value and value and you know um. You know similar goals and paths to those goals and then the other side of it is just over time I mean if I was involved in every little thing. I wouldn't be as involved in education and I just seen the bigger picture and I I always say there's three things that you. Leverage is you leverage other people's knowledge. We talked about this you leverage other people's skills which I get 400 hours to work done every day because I have 40 employees or whatever they work. Eight hours 10 hours a day so and then other people's money which is the real estate side of it. But anyways I think just realizing that I could maybe be more involved and maybe we' get a little better deal and maybe there'd be a little more equity and we could buy you know eight this year because I'm busy doing other things or I could just be hands off. We could buy 40 this year like I'll take that so kind of like the bigger picture side of it. I think I think that you figured out what truthfully I personally see as the greatest bottleneck. The vast. The vast majority of entrepreneurs and business people that I know their their biggest bottleneck is that they have no ability to delegate or they. They lack the ability. They lack the ability really to like let go right of that control. It's not even that they don't know how to delegate. It's just that they are physic like mentally incapable of and physically and physically like incapable of of Letting Go and and I like just even saying that I can think of like five people off the top of my head. I'm like dude you'd be doing so much more if you just could let go tough yeah. It's tough though man because it's your baby.
•  It's what you've done. But I think we're very intentional with it. Like we read um. I we read books all the time and we have a leadership team me and Lucas our Coos of each of our companies. Our three companies and our CFO we meet every wed or every Monday morning at 8 am. Like Mastermind go over like high level numbers and talk and then uh we read books and we read books and we like read a chapter and talk about it kind of like a book club kind of thing but a lot of the books we read are on things like you're talking about you know uh good to Great by Jim Collins. It's all about giving up control and gra having level five. So we read these bigger mindset books together and that gives me confidence in the team of my my coo and the other Coos. That of like I am don't need to be involved in every decision because we've sat in rooms together and talked about what's priority and giving up control over this and we've had these conversations and we've argued and we've buted heads and we've grown trust over time and it's very intentional every single every single Monday we were we're just got done reading um. We just we just got done reading Dar to lead by Bernay Brown all about being a great leader and rumbling and then being vulnerable. Now. We're reading secrets of a Millionaire Mind um by T har Becker. So we read these like mind set like business books and that just gives me more confidence I guess I'm trying to say in the team because I see them growing emotionally and and and mentally and and uh I have more trust in them because I know we had these discussions and I trust that they're going to make the decision they don't need me to help them because I I we grown that trust together yeah and it's interesting BR because when you when you when you grow alongside of other people and you're you're building something together it can be easy to trust you know like a like a collaborator or a partner or or something like that a little bit more difficult when you hire an employee to kind of take over some stuff and I'm wondering you know for you. Guys is there a process or like how how have you been been able to effectively train people to scale yourself out of certain tasks of certain responsibilities in the day-to-day of of of the you know of of the investment side of things. Not the education side of things spec. Specifically the investment side yeah. No that's fine yeah there there there's two ways to do it you probably like one you might not like the other um. I'll go with the one you might not like first great um. We have hired a lot of our friends um. A lot of people say stay away from U you know business and Friends uh and family um the COO of our flipping company. Our inves you know flipping company is Lucas's brother-in-law. He was the director of sales for a large liquor distributor in um the St Louis area that you know did a few hundred million a year so very very talented individual so wasn't like nepotism. We tried to steal him over for years and finally got him um. So we we are big on. We will teach you the skills or we will buy you the course or we will hire the coach to teach you the skills we want loyalty. We want you to have the same core values as us if we've known these people for years like of our 40 employees. Probably 15 of them I've met from five years old to 20 years old. They're high school buddies. They're college buddies. There's people that I've been through things with these bar fights and all these playing sporting events and like there's that trust and loyalty. They will run through a wall with us not for us but with us and you can't really buy that and that's really hard to predict when you're hiring off of an application and an interview so that's the first thing we do uh and it does provide some messy situations. But we set the expectations and we've had to move people around luckily. We have three companies in a few different roles. We've had to move people rols to get them on the right seat and the right bus and that's been a little bit hairy. But we figured it out and the other thing we do is. We're very strict in our hiring. So we do I'll just quickly run you through our process. We have obviously an ad go out we our networking and and our things to try to get people to fill applications. Application review phone interview assuming you pass these in-person interview. After the first inperson interview we send you a personality and skills assessment. They take that we review those results we have them in for a second interview and we talk about the holes in either their skill set or personality type. For that specific role. There's no right or wrong answer but an accounting skill set and personality type is not going to probably make the best salesperson and vice versa. So we say here's what this says your skill set and or personality is. This is why it's a great fit for the role. This is where concerns what do you say about that because this isn't an exact science fight for not fight for but give me the reasons why this says like our video editor who uh we hired. One of our video editors had low attention to detail as one of the skills. He's like no when it comes to editing. I like make sure everything is good and come to find out. Knucklehead has a crazy low attention detail. There's misspelled words. All the time in the stff. He edits he knocks over camera. He's the clest person in the world so we're working. It's incredibly talented kid. We're working with him on that stuff. It's fine but the personality test was right. He lied yeah um but anyways it gives a certain degree of confidence and then we do like a um coffee dinner something in person with them and their significant ubber if they have one.
•  So we can see how they interact with waiters and waitresses and outside and then we hire them. So that's how I think we're able to have like that's a big process for a small company. I feel like um and then our friends that don't have to go through as much of that Pro. They still go through the process but a little bit quicker um making sure it's a good fit. We don't just hire anybody that's our friends and then yeah and then we're pretty strict in who we bring in similar to similar to bringing in tenants. You spend a little bit more time up front approving the best tenant communicating the expectations making sure they're a good fit passing on some iffy ones and they'll stay longer and you'll make more money. It's the exact same thing yeah hiring is having a a a a good hiring process in place is definitely important. I would absolutely agree and um and I I can also add like in my experience. You know working with friends people that you know is not a bad thing or a good thing I will say that setting those expectations upfront and and finding a way to hold people accountable that you have a pre-existing relationship with can be a little bit more difficult. I have found but maybe you don't have that problem or maybe you have enough people outside of you in the business where it's like hey. I'm not holding so and so accountable this other person's holding them accountable. They're not friends right or they don't have a pre-exist relationship. So I don't know how you guys kind of balance that or juggle that but a little bit of both yeah a little bit of both. We there's layers like we said Lucas I each have a COO that reports to us and that's it um. So. There are layers but there's also there's that expectation that's there's that communication we're not afraid to have tough conversations good friend buddy that I've you know not since I and we met in kindergarten on the playground field when I scored a soccer goal on his ass but anyway so we we you know we have these conversations like hey like here's your clear expectations of your job. You're not meeting them. I love you let's figure out how we can meet them together. Do you need more help here do you need. More checklists do you need more tracking all right so all right the next 90 days. Let's get you on an improvement plan and every single day report these thing like so that usually takes care of it because most people want to do well um and we pay them very well so they don't want to go anywhere but like it's just having that clear conversation like I don't hate you. I love you let's figure this out together just because you're falling short and these numbers clearly show why you're falling short. So let's come out with a clear plane to get you out of this hole. We want to coach you up and not coach you out and we've had. We've had a couple buddies that have left and gone back to their old job because they hadn't worked out but guess what we still see them and and hang out with them and golf with them. It's no big deal so right again. I think it's where gu hay is when you like don't talk about it or like you just like it's awkward and you don't bring up these things and they know that they're kind of screwing up and you know they're screwing up. But you don't talk about it's awkward and then and then it blows up and you yell each other like just be open and honest and upfront and that's the culture that we uh that we um bring into the all levels of the company. Yeah I um I love that and honestly open communication is very difficult and I think that learning that skill as as a business owner is is super important and it's one that I learned later than I should have cuz. I definitely had a few of those situations where like hey you just don't talk about it and uh and these these should be things that you talk about all the time and kind of like air things out as as they come up as opposed to like letting them get larger or bigger than they need to be and um super. Critical super important. Sam. We're uh we're running up on time here and I feel like we could do like another. One of these honestly like do one or two more have me back. We'll see how this one does make sure this one performs well and then have me back I don't I want to earn my key. All right man sounds great well. Let's um let's shift gears to the future of real estate. I know that we spent a lot of time on building the company and education and that was awesome but but for the investors that are listening to this right now given how much experience you already have what do you see like what trends are you seeing on the horizon here in the real estate market over the next 5 to 10 years and what are you personally doing to kind of position yourself for that yeah. For sure I got a lot I could get into here and so we got a few minutes but in general a few things one um. I think real estate's got gonna go up in value. I've done the research like it's never a bad investment to have like if you wait to buy the dip you lose out on. So much the studies have been done. You lose out on um so much potential. It is not worth it so I've done the math. I've seen the charts I don't manipulate numbers. I just look at the charts real estate doubles in value every 15 years as I mentioned earlier so you buy now. It's going to be doubled in 15 years. I did the math from 1950 on bought a house in 1951. 1966. It doubled at least bought a house. In 1974. 1989 it doubled so it every every 15year increment. It's doubled except three and it went up like 94 92 and 88%. So it's a very good investment. Sometimes it's triple so there's that side of it like. It's always a good investment so understand that that the timing is never going to be perfect um if the timing is perfect. Then the opportunity is gone so just the timing is never going to be perfect. So just know that I think predicting the future is like. It's a good thing to get into and then as far as like. Trends and things so don't have a crystal ball here. But I have a couple thoughts like interest rates. Obviously. I told everyone last year. They weren't going to go down. This year they're not going to bump them. I've talked to some economists about this people in the administration like they're not going to meaningly dip interest rates until inflation is at two. They're not going to do what at 2.8 they may drop at a quarter point or they're not going to do it. You know uh you know at 2.6. Even they're not going to meaningfully drop rates until inflation gets to two and there's so excuse me. So many things going against that I don't think there's going to be a meaningful drop. In the feds. Funds rate for a long time um that doesn't mean we can't get commercial rates in the fives low sixes right. Now they're in the eights that doesn't mean we can't get residential rates in the high fours. Mid fives but not the low fours or threes again like that's that that ship has sailed so you have to learn and adapt. I talk about this all the time I can predict the future and I I create systems around that future. I know the us is going to print more money no matter what I know that the dollar value is going to go down no matter what I know that real estate's going to go up no matter what in aggregate. So I create conditions around those things and that's what my systems have been built around in my community so knowing all that there's things that you can do to combat higher interest rates. Midterm rentals are something I've been really heavy on over the past probably six eight months traveling renting out to traveling nurses or to corporate leases or to um insurance claims like people don't understand. There are about 200,000 available midterm rental units on Furnish finders which is the midterm space for midterm rentals and there are about 2 million traveling nurses and there are about 250,000 like uh digital Nomads and there so the supply and demand is the most whack you're ever going to see in any industry. So these 30 60 90day 120 day rentals to midterm n to traveling nurses mainly are gold mine. You can get double the rent five times the cash flow and they work and they stay and they work and they sleep and they work and they sleep and they're gone and they're incredible tennis to have and there's very little issues with them. So I think midterms are a huge thing and they're going to be I feel. Like this is short-term rentals in like 2010 getting midterm rentals now as a strategy and then there's always these creative financing and sub two type of things you can do to take advantage of these rates so um interest rates are going to go down. Supply is not going to churn until that point because nobody's leaving a 3% interest rate for 8% interest rate. So I don't think there's going to be a ton of transactions happening I do think it'll loosen up a little bit and then I also think last prediction then. I'll let you roll um is. I think that the government is going to be pretty involved in home ownership in the next five to 10 years. I think they're going to try to get rid of some hedge fund purchasing. I think they're going to offer incentive programs through HUD and through lobbying to give incentives for Real Estate. Investors. I know this by knowing some lobbyists in in DC by giving incentives for investors to sell their real estate assets and not have to pay Capital Gains so that inserts into the supply by incentivizing new homeowners with grants and funds and lower interest rates and longer mortgages. So I think the government's going to be super involved in like firsttime homeowner or home ownership in the 5 to 10 years through programs and incentives and things. And I think that's just going to provide more opportunity for investors and homeowners yeah. That's there's my take crystal ball blurry yeah man well hey actually those that's some those are some really um interesting insights just to just to add a little bit to the midterm rental thing um. There is a lot there that we're not going to have time to get into in that in this podcast but like I would absolutely agree that there is something there. I think that the um you know a couple things the wear and tear and the overall overhead to up keep a midterm rental versus short-term rental significantly lower right significantly um. So your expenses are going to be lowered uh meanwhile the you might not be capturing the highest rate possible like you could with Str. Strs. But your occupancy sure is going to be a lot higher right or theoretically right um could be a lot higher 85% is average you're right 85% occupancy for midterm rentals is average. Short-term rentals is 50 and low terminals is 95. So you're spot on okay perfect well. I'm I'm glad to hear that just like in in my head you know just kind of applying like hotels to this right like I would I would equate midterm rentals to Extended Stays. Right and Extended Stays have the best margins um and they typically you know outperform you know the limited service hotels significantly um in terms of cash flows.
•  So it's interesting that that there's there's some parallels there and the government thing that's that's a great nugget man well listen in traditional Gold Mine. Fashion Sam would love for you to leave our audience. You already dropped a bunch of them but one final gold nugget all right. My final gold nugget would be um to embrace. Failure. Um failure is literally on the path of success success. It's so simple that if you avoid failure you avoid success there's nobody that is any moderate level of success that hasn't failed multiple times. So if your goal is to not fail then your goal is to to not win. It's. It's it's really that simple so learn to embrace failure. Um don't intentionally seek it out but if you get up it's not failure. It's a learning lesson. That's what learning is like when you do a math problem. You got it wrong. You get it right the next time you just learn the right way to do it. It's not failure. It's learning so so so many people I see wait for the perfect scenario paralysis analysis and and they end I'm never starting because they are have. They have a very deep-seated fear of screwing up and failing whether it's their ego. Whether it's their parents. Whether it's insecurity whatever it is. I have all of those things but I'm not afraid to fail because I understand that if I want to be successful I'm going to have to fail there is no way around it. There's no path to it without it so just know that and have that expectation and I feel like you will be much more successful much sooner and much happier with is all really what it what it's all about anyway. I love that Sam you've been awesome man so glad that you were able to make it and uh I know that the audience definitely walked away with uh more than their fair share of nuggets. On this one man thank you so much audience like it share it promote it give it ratings and if we do enough of that he'll have me back there we go baby. There we go oh yes and all of the all of your if you want to uh more information on Sam's uh. Uh course all of that will be in the description box down below yeah. Just have them hit me up on Instagram if they're interested in the course. Don't go there talk to me first hand on Instagram check out. My podcast my YouTube channel see if you like it and then chat with me about the mentorship but just get in my uh social network first and then we'll we'll talk love it. Awesome. Sam for.