Jason Hartman begins the show in Kansas City where he talks about the local real estate market and what you can expect as an investor. In the interview segment of the show, he hosts family office expert Richard Wilson. They talk about how much it takes to have a family office and the importance of integrity in both business and investing. Then they discuss niche domination and why it’s a good strategy.

Investor 0:00
This market specialist was able to tell me the absolute lowest rent they’ve ever rented in that particular neighborhood within a certain parameter. And that number was great. It was within $50 of what they were telling me, even if I get the lowest number that did great return terrific results. And then the other thing about having people applying and teed up and lined up to rent your properties right away, just because at marketplace so huge and so many people, that just gives you a sense of confidence that you’re gonna have a very good cash flowing property without a great deal of risk is going to sit vacant for a month or two months and that sort of thing.

Announcer 0:33
Welcome to the creating wealth show with Jason Hartman. You’re about to learn a new slant on investing some exciting techniques and fresh new approaches to the world’s most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine self made multi millionaire who’s actually been there and done it. He’s a successful investor, lender, developer, and entrepreneur who’s owned properties in 11 states had hundreds of tenants and been involved in thousands of real estate transactions. This program will help you follow in Jason’s footsteps on the road to your financial independence day. You really can do it. And now here’s your host, Jason Hartman with the complete solution for real estate investors.

Jason Hartman 1:23
Welcome listeners from around the world. Thank you so much for joining me today. This is Jason Hartman coming to live I guess. Well, you know, what does that mean anymore? I am on location and guess where I am. You know, I say the debt is my favorite four letter word. And I love to use debt as a powerful tool to accelerate wealth creation and reduce risk. And I happen to be standing in front of the Federal Reserve Bank of Kansas City. The addresses one Memorial Drive, I’m looking at the sign right now. And I just toured the place where they indicate Eight people. It’s called the money museum. And I toured it with one of our local market specialists who happens to be here with me. And that is Dave, you’ve heard him on the show before. How are you doing? I’m doing well. Good to see Jason. It’s good to have you and thanks for just coming down here so fast as I suggested, maybe at the money Museum, and you know, that’s we’re in the money business. So we wanted to talk about it. This is really interesting, because we looked inside and we saw a wall that had $40 million on it in cash. Wasn’t that incredible? It’s crazy. It’s crazy how much money’s in there and they gave us a free bag of money as we left. Yeah, yeah. Free bags of money on your way out. Now. Of course, it’s shredded money. And they would only let me take one I tried to get a couple for friends, but they said that limit limit one per visitor. I’m gonna grab a picture here that I took inside. And it had an amazing statistic on it. Let me find that. So listen to this, folks, as we’re looking at the $40 million wall. Did you know that on average, It takes only 24 minutes for the Bureau of Engraving and Printing to print 10 million new $100 bills in 24 minutes. So if you don’t think money is going out of style, it definitely is. Really we should say currency. It’s not money, it’s currency. There is a difference that I have discussed on the show many times before. Meaning that money, of course has intrinsic value. currency is simply Fiat paper. But you know, you can use that for your paper. What I will say is align your interests with the most powerful forces on Earth. One, we are standing in front of the Federal Reserve Bank. And the second most powerful force on earth is governments, governments and central banks. Dave, what do you think about all this crazy money stuff and the way the Federal Reserve operates? Yeah, it’s a little bit insane when you’re really trying to put your head around it and I love your podcasts and other folks that train on debt and inflation and here’s here’s my two cents like yesterday was voting day, right? So I vote. I believe in Your civic duty. Now if it was two cents yesterday, it’s worth 1.8 cents today. Yeah, even less. So by all means do that. But at the end of the day, instead of sitting here in pink and complaining about the way things are right with inflation and dad in the way currency is, why not do what you suggest and educate folks on which is take advantage of that those forces are in play, you know, do whatever you can to fight against that. But at the end of the day, take advantage of that. And, you know, investing in passive real estate, taking advantage of taking advantage of inflation, because that’s happening. The central banks, the government’s are heavily invested, they’re going that route, so go with the flow. If you’ve ever jumped in the ocean and trying to fight the tide, it’s really tough to go with the tide. And that’s my two cents. Absolutely. You know, it reminds me of that old quote, because he used an ocean metaphor is the set of the sails and not the gales that determine the direction of the ship. And that’s sort of like this, you know, just align your enter. These forces are too powerful, complain about them all you want, but you’re never going to beat them. Given Submit. Be the subject be the pond. Just do the thing they are doing. My investment strategy says just mirror the same strategy as governments and central banks. And that’s the thing to do. You know, maybe one more comment on this, then let’s talk about the real estate market and what’s going on in the markets you cover. Sure, yeah, to underscore that, I mean, create your freedom and then do what you want with that, right? So take advantage of like, we’ve talked about the tide that’s already there, the forces are in play, create your freedom, then go do what you want with that create the lifestyle you want from that? Because, you know, I think about the difference between rich and wealthy and to me, it’s time right? Rich people think about money, money, wealthy people think about time, how can I create more time for myself and buy back some time and for me, that’s what passive investing is all about having a lifestyle like you are, you’re traveling everywhere. For me, it’s time with my family at the lake, but it’s about time and that’s what passive income is. And so that’s ultimately create your freedom. Go do what you want with it. And don’t sit here and try and fight the forces that are going to move, you know,

Jason Hartman 5:58
absolutely. You know, all the money. In the world, it might buy you a little more time, but it won’t buy you much. You know. And of course we explore these ideas on my longevity and biohacking show. And I do think that is changing and the people that will be able to take advantage of these amazing life extension opportunities that are coming their way are the people who have resources who have money, because they will be the first now ultimately, it will democratize probably like every other technology and everybody will be able to take advantage of that. But at first, it’ll be the people with the money because it’ll be expensive for these various treatments and so forth. Whether they be stem cells or whatever, you know, just check out the longevity and biohacking show for more on that. Hey, so a lot of the high end real estate markets around the country are really showing some signs of sickness, aren’t they? And let’s kind of compare and contrast that to what’s going on in your markets. And first tell people People ask me this once in a while and the first time I ever heard the phrase I had to add I will admit I had to look it up in Wikipedia. What is the quad see Yeah, so Quad Cities is a cluster of four or five cities quad meaning four. So really it’s four cities Davenport, Iowa, and Moline, Illinois being the two major ones. There’s Bettendorf Iowa, there’s East Moline, but it’s geographically halfway between Des Moines, Iowa, and Chicago. So draw a straight line in between right on the Mississippi. The area’s called Quad Cities, but there’s really not a city called quads. It is just that region, so Davenport, Iowa, Moline, Illinois, is one market that I’ve been in, you know, for years and years and years. And then we’re in Kansas City, which is where I live. And that’s the other market that I do turnkey out of Okay, so tell us turnkey properties in these markets and you’ve been working with us for many years as a local market specialist. So what’s going on in those markets, give us a pulse on them. I’m sure you’re probably gonna say you know, inventory is tight. The market is booming, and that is definitely true in the linear markets. But as you read the major media, there are articles now about the market slowing that’s the cyclical, expensive markets with bad lm Ti or land to improvement ratios. In other words, high land values, low improvement values in comparison improvement, meaning the house or the apartment building that sits on the land. We want to invest in the linear markets with good LTI land to improvement ratios. So give us a pulse on your market and talk to us about some of your properties that you actually have available right now. And by the way, folks, make sure you subscribe to my new, really unique podcast called the property cast, where you can get properties PDF files, in your podcast feed. That’s amazing. Everybody thought that was impossible, but I knew it was possible. So I pioneered the thing and we’ve got it there for you. Just go to iTunes or whatever podcast platform you use and type in Jason Hartman property cast and subscribe to it and please rate and review it and you’ll get performance of properties right in there, including the ones we’re going to talk about today. Yeah, so I’ll do a little comparison kind of compare and contrast. And then talk about you know, some some Well, let’s start with the similarities right to Jason Point, a lot of Midwest markets. I mean, we’re in Kansas City right in the middle of the country, right? You can’t get more Midwest than this. They are these linear markets. So you know what I would call steady, Eddie, you’re never going to see wild fluctuations, right. So from a cash flow standpoint, they’re great. So both markets fit that bill. Certainly things become more competitive in Kansas City, it’s a larger market. Some hedge funds are in town, and the markets heated up considerably. But we’re still able to get solid returns and we stay in, you know, nicer parts of town. So in Kansas City, you know, $150,000 turnkey, you’re still from a leverage standpoint going to be on a cash on cash return of double digit, and Quad Cities is the price points, they’re a little bit less. And the reason I work out of the Quad Cities is because we’re able to deal with a lower price point and stay out of what I would call the urban core. So for example, in Kansas City, which is my home, I love it. We don’t source out of whatever called the urban core because you can find that $80,000 house $70,000 house in Kansas City. They’re just neighborhoods and properties that I wouldn’t be comfortable sourcing. So in the Quad Cities, we don’t have that type of an urban core extremely low crime. So we can get a lower price point house. And it’s also very high home ownership versus rental market. So for example, it’s about 70% homeowners versus 30%. renters. So you get a very different type of tenant there, as you can get a 90 hundred thousand dollar property that’s going to get you a cash on cash finance, return of, you know, 1213 15%, even in today’s competitive market, and we’re able to get plenty of inventory in the Quad Cities because it’s such a smaller market. It’s kind of a little hidden gem, whereas Kansas City, I mean, it’s a it’s a bigger market. A lot of folks in town, so it’s, you know, more competitive, I would say the Quad Cities are Yeah.

Jason Hartman 10:47
Okay, so in the Quad Cities, you’re going to get better rent to value ratios then right because you’re going to get a better quality neighborhood a better quality tenant, because to get those RV ratios, the better ones. You don’t have to Go into the urban core and sacrifice. You know, you don’t have to go down to like a C quality property you can get a B or can you get A’s for that price and quantity? You cannot. So yeah, you’re gonna deal with an older built home. Our average rehab in the Quad Cities is 40,000. So a team that’s been doing thousands of, you know, deals, you know, over 12 years. No rehab for them that’s costing them 40 50,000 is a complete gut job, right? I mean, all catbacks all mechanicals are being done. It would cost the average person 60,000. So I don’t want you to gloss over too much. So cap x is capital improvements that are not like maintenance and repair type improve. We talked about that before. But also mechanicals explain what mechanicals mean. Maybe a few people don’t know what that means. Yeah. So the high maintenance item. That’s a great great point roofs, plumbing. HVAC, expensive stuff. Yeah, things systems. So when you’re putting all new mechanicals in and you have deferred maintenance, like you put a brand new roof on you’re not going to To replace that roof for 1520 years, so they expensive items are deferred for, you know, 10 years plus. So we’re able to do a complete rehab on that type of property. And so you know, for 90,000 to have an A, what I would call an a rental property in the in the Quad Cities, you know, your numbers are going to go down your you can buy a rental up there for 150 $200,000. But your you know, cash on cash return is going to be six 7%. So it’s not what we found is clients would rather have as long as they have a complete new rehab, they would rather have the cash flow when the cash on cash return, and you’re still gonna get a steady over time. If you look historically, the Quad Cities because of the economy because you’ve got the rock on an arsenal, it’s never going anywhere you got john deere headquarters, you’ve got this market that’s just marching on. You’re still gonna get you know, a small appreciation over time, but it’s really a cash flow play in the Quad Cities. Yeah, and cash flow is the way to go. appreciation. You know, very unrelated I have yet to meet anybody who can reliably predict market cycles. There are certainly clues. But at the end of the day, a large degree of it is a gas. You know, I think, yeah, exactly. Even the folks here at the Federal Reserve when we were standing in front of the Kansas City Federal Reserve Bank, well, we this is a nice building. You can tell there’s a lot of money in here. I use the restroom here. It was gorgeous restroom. A lot nicer than any private establishment. I’ll tell you that much. But hey, this is a private establishment, right? It’s private corporation. It’s about as federal as Federal Express. So that’s what they say. You know, what I’ve noticed over the years, the past few years, especially and I don’t know if it’s because the properties being sourced are of lesser quality. In other words, maybe people like you are local market specialists have to dig deeper to find a deal because the market has been so hot, or, well, here’s what I was going to say. I’ll start with what I’m going to say and then we’ll unpack Got a little bit. I’ve noticed that when I make hard money loans now and I’m a hard money lender and I loan to a lot of our local market specialist i don’t think i’ve loaned to you yet.

Richard Wilson 14:09
No, you haven’t. All right,

Jason Hartman 14:10
well, if you need any money, let me know. And I’ll loan it to you. And and so I do these short term loans that are like six month loans to our local market specialist all the time, you know, it’s regular currency. And I started hard money lending maybe eight years ago, you know, to do it in any real way. I’ve noticed that when I’m looking at the deal, the rehabs have gotten way more expensive. I mean, there, I used to finance deals where rehabs would be 712 $15,000. And now when I’m looking at the sort of stack of that deal, the way the capital stack has to be, it’s, you know, they’ll buy the house for, I don’t know, 70 grand, and it’s a $40,000 rehab. And I’m like, Why are these rehab so expensive. The construction costs risen that much. I know the materials and the labor are much more active. than they were just a few years ago. So for those of you who say there’s no inflation, you’re out of your mind. But also it’s probably a combination. You got to dig deeper for a deal to I’m guessing. Yeah, it’s It is a combination. So again, a compare and contrasting. In other words, you got to buy the uglier house than you used to have to buy, right? Yeah, something that’s like, for example, Quad Cities, that is what we buy, we’re buying something that, you know, is an reo, it’s, you know, it needs a lot of work. And we’re putting 40,000 in, because it’s an older real home as well. In Kansas City, our average rehab is 20 25,000. So it’s a 1980s bill. It’s an a nicer part of town. So the rehabs don’t take as much a lot of the mechanicals are newer and those so that’s I can only speak to really those two markets. But that’s a part of it. If you’re dealing with a you know what i would categorize as an A type of property. The rehabs take less versus a complete gut job on a C type of property. What do you think people should buy? And I know our investment counselors have a lot of opinions about this. And our clients have a lot of opinions about this. Some of our clients are the sort of bargain hunter type, and they really want to deal they want to buy the C properties. And just because they look cheap, and some people just want to buy a properties, nice properties, nicer neighborhoods, what do you think is sort of a sweet spot, you can make money in anything, of course, you can make money, buy enough properties, you know, if you want to take a gun to collect the rent, but what’s the sort of the sweet spot for remote investors that don’t live locally that want to invest in areas that are better than the local area in which they live? For better returns? What’s the right property for them to buy? What would be your counsel there? It’s a great question. I get that question all the time. And the quick answer is, it depends and I don’t want to make that as a blow off because it really does depend on your appetite and what your goals are. So I agree with you 1,000% that it’s about cash flow, right. So that has to be first and foremost. But when I say appetite, I mean for example, if you go to your like steak or fish, you know, well, but also your appetite for risk and when So for example, a see property right? There’s a margin of error there that if things go well, and you’re with the right team, if you’re getting the right property management, and that rehab has been done right, you can verify that you’re going to get cashflow. Some folks, though, don’t have I would say a more of a stomach for that kind of a risk reward. So it really comes down to the team you’re working with and have the property management, I would say it this way. I mean, the property management is so important that I personally would rather buy a see property, even if it’s in a borderline shady part of town, if it was rehabbed with the right team and the property management in place versus a nice a property done with the wrong team. So the overall answer for me is it really depends on what like stage in your investing. You are like there’s some folks who are right at the end, they need to retire pretty quickly. That’s a different strategy that say that somebody in their 30s maybe it’s they’re going to go with more of a long term potential equity play and like you said, Nobody knows about appreciation. So I would say it really depends on your appetite what your goals are. And I would always Do a blend. I love what you say about don’t go into more than five markets. But diversify yourself at least three. And I would say even within a market, look at that, look at some A and B. So for me, my personal portfolio, that’s what I do, I’m in AB areas, that I’m going to get a nice cash on cash return, I’m in parts of town that I’d let my you know, my parents live in those houses, I can drive my kids to those neighborhoods, I feel good about that. But, you know, when you look at the complete return, you’re getting on that investment, you know, my internal rate of return, you know, depending on the situation, I mean, you’re you can’t compare it to anything else that’s out there gold, the stock market, when you’re talking about 15 to 35%, true return when your overall return on investment. And of course, these are projections, they don’t work out that way all the time. Sometimes they work out a lot better. So you know, real estate because it’s an income property, I should say. It’s a multi dimensional asset class, and you get that return from several areas. So it’s pretty phenomenal in that way. Yeah, that’s, that’s what I was. I would do a blog. And that’s what I do. And that’s what I recommend to folks. It really depends on what you’re looking for pure cash flow, you know, long term play kind of what stage you’re at in your investing cycle as

Jason Hartman 19:10
well. Absolutely. So that’s one of the commandments, you know, thou shalt use financial planning techniques. But instead of applying it to the crappy roles for you assets, apply it to the most historically proven asset class in world history. And that’s the income property. What is your time horizon? What are your investment goals? You know, what is your risk tolerance, there are many things to consider. That’s why we have our investment counselors to guide you through this process. And you know, what, folks, some of our clients call and they talk to you, they have a consultation with our investment counselors, and they just sort of want to buy, buy, buy, I would encourage you to make your investment counselor, I’m telling you, you know, make them guide you through some of these questions and decisions, okay. So you’ll, you’ll get the properties that are best for you and that’s what we’re here to do to help you with all of that. Be sure to if you have an Alexa, be sure To download our Alexa skill and set it up on your flash briefing, and then hey, you can hear me every day on your Alexa flash briefing. And we got some good stuff there. We have a huge subscriber base growing on that. So the Alexa skill is in the Alexa store, I guess they call it, set it up so that I am in your flash briefing every day. And also join us in Hawaii. First week in November, we got our two events coming up their profits in Paradise is filling up nicely now. I’m glad to say at first that was going kind of slow, but now people are really scooping up tickets and I think that event will probably sell out given especially given how much time we have before the event. So be sure to get your tickets so you’re included in that. We’re planning to do a luau, we might do a sailing trip, you know networking, luau networking sailing trip. Hawaii is just gorgeous. I haven’t been there in years. I can’t wait to go back. This is our first event in Hawaii. If you’re listening to us, from Asia, Australia and New Zealand, you know, hey, this is the closest we’ll probably get to you. So come on over and see us And and we’d love to have you there in Hawaii, go to Jason Hartman calm and check out the profits in paradise conference and join us for the venture Alliance retreat that’s just one day later in kawaii so you can group those two events together and make it an awesome time. Okay, hey, we got part two of Richard Wilson today and let’s talk about investing techniques of the ultra wealthy and family offices. So here we go.

Jason Hartman 21:29
Before you leave the family office thing, do you have to have a certain amount of net worth to have a family office?

Richard Wilson 21:34
Yes, I mean, typically to become a client of a multi family office. You know, several take you in seven min, you start at 10 million net worth or liquid investments. And then you know in the 10 to 30 million range are typically becoming a client of a multifamily office. Once you do get worth 2530 million, especially when you get worth 70 100 million plus, you typically look at starting a single family office for yourself. Even if multifamily office or private bank, okay, you know like a Goldman or UBS has helped me manage part of it. You keep seeing multifamily office and I’m not sure people know what that means. Do you mean for multiple families or multifamily properties?

Jason Hartman 22:14
Just to see if you would, yeah,

Richard Wilson 22:15
yeah. So it doesn’t have anything to do with multifamily properties, but multifamily offices are family offices that serve five clients, 10 clients, maybe 100 different clients. There’s one multifamily office I know that only takes hundred million dollar net worth clients, and they have about 30 clients. Some others have 200 clients all worth 10 million each. And so but again,

Jason Hartman 22:35
when you’re doing that you’re religious back to the outsourcing and the control problem, aren’t you? Or, or maybe not because they don’t sell anything? There’s never a conflict of interest, probably right.

Richard Wilson 22:45
Yeah, most of the time, they don’t sell anything or if they do, they say our only area of expertise is self storage. So if you ever want to access the Self Storage, it’s an option on the table. Everything else is third party and we’re not pushing you a product. We just charge you a flat fee and it’s not you know, We don’t care which one you choose, it’s just whatever’s best for you. So some of them are conflicted, and they just try to wear it on the sleeve to kind of, you know, show that they do have one thing that they do internally.

Jason Hartman 23:08
Yeah. Okay. All right. Okay, go ahead with best practices of center millionaires.

Richard Wilson 23:13
So I think a couple of the most important points mean, one you kind of were hinting towards already about identifying a bottleneck. And we often times refer to those like Vern harnish. He talks about choke points. And essentially, what I found in my own business, and then I found with many family offices, is that finding the most costly part of your business, or the thing which will be natural lead generation for your business, but it’s a separate operating business in itself can be some of the biggest sources of leverage and they also can cost nothing. Sometimes these can be media assets, like when we are starting in the family office club, we are able to acquire family offices calm for just $10,000 and we built it up into the most visited website, on the industry. We use that to get a book deal with Wiley on family offices. led to our podcasts and LinkedIn groups and that led to our events. And so each one I see is a choke point kind of getting like a Jim Collins flywheel concept, just getting that to slowly turn over and each choke point you can acquire turns over that flywheel another rotation. And just as is more forward momentum. So what’s most interesting to me is that as we’re growing the family office club, we had a platform model that had a couple different media aspects chokepoint ideas worked into it, a couple different operating businesses in one platform. And I would get critiques sometimes people saying, Oh, you should just do one thing, or you should just focus on this one area. They didn’t really understand why I had that added complexity. But what’s really interesting is as I got more and more cold calls and cold reach outs, from hundred million dollar plus families, it was the center millionaire patriarchs and the heads of the family themselves most, who really loved talking about exactly what we’re talking about right now. They love talking about choke points. They love talking about a platform strategy or you know, the idea I’m going to talk about next. And so, I’ve found that the most successful people don’t approach the business and that that straight head on way they do think strategically. I’ve never gotten a negative ROI out of spending some really concentrated time on choke points. And I’ve just found that to be a very common theme within the portfolio’s of the clients I work with. Another strategy I want to talk about is niche domination, or kind of a monopoly strategy. You know, Rockefeller was a master at basically monopolizing his area through both using choke points, but also just being able to own high percentage of the oil trade in his time. But another example is a family I know that bought a street sweeper company and a lot of intellectual property on it as most patent device on the market, and then they’re able to buy a garbage truck manufacturing company as well, that also had a lot of intellectual property on it. So they had they could do licensing and have other ways of getting an ROI on their investment. And now they have to Have those high IP assets and they’re able to call all on a single county, and they have both things to be selling them. And that investment has gone very well for them, because their competition typically doesn’t have multiple offerings and they don’t have all the intellectual property rights, which they can use to defend their turf and kind of expand how they occur revenue that business. So dominating a small niche area is a reoccurring theme that I’ve found, and it works so well that obviously there’s antitrust laws that Amazon fights and that, you know, Microsoft has fought in the past and at&t broken apart for well, and then just

Jason Hartman 26:35
yesterday or a couple days ago, that was very much in the news again with at&t and they Time Warner who they won the right to do that deal with Time Warner. Yeah,

Richard Wilson 26:44
yeah, exactly. The reason why it’s illegal on a mass level is because it works too well. Yeah, like it breaks the game of capitalism because you destroy your competition. monopolies are

Jason Hartman 26:53
great. Oh,

Richard Wilson 26:55
you know that in a small local market and a small niche market. I mean, I’m not a lawyer. So now No one should take any action based off any podcast he listened to without talking to a lawyer, but like in certain small markets, or in a small real estate, geography, you know, like a four block area that’s near downtown area that you think inevitably worth more in the future or a new niche area and stem cells that, you know, there’s opportunities to monopolize a little niche can just nail that and be all over it. And I see families doing that and having done that, and if they do it in a rising tide, like Warren Buffett says, sometimes the tide matters more than the swimmer, you know, if you identify that right tide and applied choke points in a niche domination, strategy, I find these things in combination just lead to a real superior force in the marketplace. Okay, all right.

Jason Hartman 27:41
That’s probably a good segue into maybe another best practice of the center millionaires.

Richard Wilson 27:45
Another one that I found is that they like to be as close to the source of an investment as possible. So they would be the last person to want to invest in a deal or even hear about a deal where it was a broker Part of it a broker network. And then they heard there’s a deal and this other location and they’re not tied to it closely, this into millionaires that I’ve worked with most often are trying to get direct to the source of the deal, because as the least layers of fees, they can manage the deal directly add their strategic expertise. And so getting direct to the deal is a best practice, but then also directly to that, defining exactly what their strike zone is for a deal. And getting as much of that specific type of deal flow as possible, is really key to the most informed and most successful sent to millionaire investors. I know. So, to contrast it, some people will come into wealth, like a family that walked into our office four days ago, they’re selling a business for 110 million dollars, they have the contract in place to just wait for it to close next month. And they say, well, we’ll invest in just about anything. And it’s kind of like graduating from college with a business degree and saying like, I’d work in any area of business, you know, I’m open to it all. It’s like, well, you might Today, but I can tell you for sure, seven years from now, after four jobs or after 14 investments, you know, like, there’ll be areas that you do not want to ever invest in again, or after a few meetings, you know, you narrow it down. I try to help families go through that maturity without the pain of spreading their money out and a bunch of random things. Because another way to say it is each investment you make is going to bear strategic fruits. And if you don’t have a strike zone defined, it’s based on your DNA, what you’re passionate about, we can make a lot of money at. And if it’s not highly intentional of who you’re taking meetings with, and what types of deals you’ll consider. You know, you’re not going to be having the synergies come out on the other side. Yeah,

Jason Hartman 29:40
absolutely. I totally agree. You know, you, I get these calls from these hokey people all the time that are like, Well, you know, I’m like the 17th person removed from a deal that I want to tell you about, I got this hot deal and that just doesn’t have a lot of credibility to me. And you shouldn’t waste your time chasing those kind of deals. You know, everybody’s got some deal like that. But it doesn’t mean it’s any good,

Richard Wilson 30:03
right? Or that it’s real,

Jason Hartman 30:05
or that it’s real at all, you know, that especially happened in the reo market, real estate owned by banks years ago, during the Great recessions, you’d get these people that really have no connection to the deal at all. They’re just someone that knows someone that knows someone that knows someone, you know, it’s like 26 steps down the line. And they’re trying to, you know, market this tape of properties to you. It’s just absurd. I mean, these guys are just the whole thing ever, you know,

Richard Wilson 30:30
it’s comically absurd. Like, I’ve gotten so many those emails in the past and having a really well defined strikes. And it’s just good for everybody. Because then people know what type of deal flow to send you. You can say, Well, our strike sounds right on our website. So of course, I’m going to say no to that pitch. And you can tell yourself that internally, tell your team or tell the person in person at the event that you’re at or the email you get, you can just point them to that strike some checklist and many people start out saying, Oh, yeah, consumer product businesses. That’s our focus. You know, there’s 20 niches in there. And do you mean us or non us country No control that equity ads. If you don’t have a dozen things on your checklist, then you’re wasting a lot of energy or you just have to realize we’re on a learning curve here. And you know, for the next 18 months, or we’re learning, we shouldn’t say yes. Or we should be very careful.

Jason Hartman 31:14
Yeah, right. Okay. All right, what else?

Richard Wilson 31:16
I think that one that ties together a lot of these ideas. And the number one thing that I started with with any client that we help form a single family office for is that they need to have a dashboard, and really a compass of where they want to go documented. So essentially, if you don’t know your family’s values, missions objectives, the reality you want to create in terms of level of chaos and control and transparency, then you don’t know what your direct investment strike zone should be. You don’t know what your portfolio should be. You don’t know if you should hire your sister, or hire Goldman Sachs or hire multifamily office or start your own. So the most important thing is to be highly intentional about exactly what you’re trying to do and why. After you have that one page. We try to fit it in. Strictly under a single page, then we help create the rest of a dashboard that really documents what real estate assets they have, what assets are looking for, and what’s the deal flow they’re looking at, it might be considering 12 deals at a time. And if they don’t have it on a dashboard, they might forget about a deal that they looked at the teaser at where they’re at in a data room for two other deals. And they might have had lunch on a few other deals, and they it’s hard to talk about it as a cohesive team. If you’re not just a one man band, you know, type family office, you know, you need to be communicating what deals are on the radar and why and how those fit into the mission and values and objectives. Em so a lot of families just have that up in their head. Or they might have a spreadsheet for deals have invested in or some $200,000 a year fancy software reporting solution that somebody sold them. But a lot of families do not have just a four to seven page, basic dashboard. You know, it’s basically a map of where they want to go and then the other pieces of are kind of plotting the course and the different parts of their portfolio, including a page managing service providers and what needs to iterate next in the family office to move things forward. And so the most successful center millionaires, I know they have to be on top of all that. I wouldn’t say a lot of them have that documented, but it’s a very, it’s like, basically, it doesn’t cost me anything. It’s not rocket science. It’s that mindset of reducing chaos and you know, having the basics of mental, you know,

Jason Hartman 33:25
makes them down. Makes sense. Absolutely. Okay, good. We’ll just wrap it up for us. Maybe if you want to share one more principle, I know we got to get wrapping up here, but or just any other thoughts to kind of put this in a in a box for us?

Richard Wilson 33:38
Sure. I think the last principle I like to leave with is that after 11 years of running the family office club, I think that the most important thing I found from working with clients, and running our own team is integrity and not just moral integrity, which is alignment of your values with just kind of good morals, but really integrity and terms have everything in your business, in your portfolio on your team, how you talk, how you interact with others, your branding, the clothes you wear, where you live, products you offer, all of those things, being all integrated, I think is the most important thing to be focusing on whether you are worth a million dollars or 30 million or a billion dollars, that goes for within the business as well as in your personal life. Because when it’s not, then something is in conflict, and you’re just fighting yourself and you’re dragging an anchor behind you. And I love this concept because I apply it to myself, my clients, our events, our company overall. And I just find that it’s really helpful and making sure that the clients we engage with are also aligned with where we’re going and who we can serve best and so just keep it integrity, centered and central and everything we do and encouraging our family offices clients to do so as well. I think just removes a lot of stress and chaos and lost capital for people who are investing It’ll kind of stick to their principles. Absolutely. I think that’s very good advice. Richard, give out your website is just simply family offices calm and we’ve got a free book on there for family offices if anyone wants to learn the basics. Alright, thank you so much for joining us again. It was good talking with you. Great. Thank you, Jason.

Richard Wilson 35:19
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