WS1212: Keep Your Eyes Open to Opportunities with Eric Nelson

EPISODE 1212

[INTRODUCTION]

0:00:00.0 ERIC NELSON You just don’t know what you don’t know first, and then there’s like these lending beliefs. I actually like laid awake at night buying that six-plex. I was like a million dollars, oh my gosh, what am I dealing with?” And I even called friends and mentors, I was like, “Am I doing this the wrong thing here?” And everyone I talked to was like, “No, it sounds like you have a good plan,” and, you know, the worst-case scenario, you default.

[INTERVIEW]

00:00:22.000

Whitney Sewell: This is your daily real estate syndication show. I’m your host, Whitney Sewell. Today, our guest is Eric Nelson. 

I’ve enjoyed getting to know Eric over the last few years. He’s been on the show a couple of times very recently. However, we were at GoBundance together and so it was a great time just to have an interview in person and hear just more about him, his story, and a couple of specific things that he has done recently. But also, there are a couple of deals that he has done that just didn’t happen by accident, right? Deals do not happen by accident, it’s because you are active, you’re out there doing something, right? 

And Eric, he was walking his child and has found two deals because he started asking questions, right? And you’re gonna get to hear about those today, it’s very interesting. But he’s a founding principal of Wild Oak Capital, he’s been investing in real estate for over 10 years. Eric and the Wild Oak team provide investment opportunities through multifamily syndication. As a co-owner of a civil enduring firm, Eric’s range of skills suites the field of syndication and real estate in both the technical level and client relations side. Eric is also the host of the Real Estate Mindset podcast, where he discusses with industry leaders what it takes to be a successful investor based on continuous personal and professional growth. We’re gonna get into mindset a little bit by getting started. 

Now also the family-life balance, you know, which you hear me talk about maybe a little more lightly, I’m not sure, but Eric will talk about it because it’s so important and it’s something that was so out of balance for me to get our business going, but it’s something that’s so important to me now, and I’m trying to do that so much better. That you’re gonna hear Eric talk about that, just the time with kids and just time with your spouse, but while running a successful business. You’re also gonna hear about these two projects, two deals that he bought, you know, just by asking questions. I mean it’s just… it’s so interesting how it all happened, these two deals anyway. Then some about… some creative financing things that he goes through. Eric’s a great guy, you’re gonna learn a lot from him, he is an up-and-coming syndicator. I mean just doing some big stuff, so I like Eric a lot. You’re gonna enjoy the show. 

All right, I’m back at GoBundance, again with some amazing entrepreneurs, and I love the in-person interviews. My guest today is just an amazing man, I’ve got to know him a little better over time, we’ve met to help set different conferences, we’ve talked to numerous times, and actually, he’s been on the show, so I’m thankful to have him back. Eric Nelson, welcome back.

00:02:47.000

Eric Nelson: Whitney, thanks to you ,so much. The pleasure is all mine. I’m honored to be back on, and it’s kind of cool to do it in-person.

00:02:52.000

WS: Yes.

00:02:53.000

EN: I mean, you can do it over Zoom, it’s just not quite the same so, happy to be here.

00:02:55.000

WS: Yeah, it is not the same. I just love the energy, even with all the entrepreneurs share me pushing, set levels that we’ve never imagined, helping hold us accountable in ways that we need, but then also just to get to see people like you again, right, and talk about how we’re doing. And I mean, it’s just motivating I think, but I love the energy on the podcast, being in-person. 

So, let’s start though, I know you were on the show not too long ago but I thought any updates about your business, Wild Oak Capital, anything we should know? Anything you’re working on that we could help the listener with?

00:02:23.000

EN: So we actually get like, I’ll talk about a couple of updates. So you know, I think the last time I was on, I was sort of dancing around a deal because it hadn’t closed yet, and so that one’s closed and then it’s going really well, and I think, you know, one thing is we are really conservative with our numbers that are already beating our year four rent projections. I mean it’s just going really well and just really grateful for that type of thing. You know, it makes you wonder how conservative you need to be an underwriting in a market like this, but I think one thing that I would say with the business was just like stick to that conservative view, even though bring projections to look great, stick to what you’re doing. So that’s probably the biggest update, as we close that one, working on a couple more. I think I told you about one last night, we were working on it in Colorado, which is where I live, I’m from there, so it’s kind of fun to have one in my backyard at least. Technically, I mean it’s not even under contract yet, but it’s just exciting to have one local.

00:04:14.000

WS: Awesome, and there’s a couple of the things I know we’re gonna talk about, but before we do, I wanna talk about a couple of deals that you found recently that you and I were discussing beforehand. I just think it’s a neat story and I just think we need to keep our eyes open all the time for opportunity, right? And you did that more than once. I want you to be able to share that with our listeners and a couple of deals that you purchased but get us started with that, it was six-plex?

00:04:34.000

EN: Yeah, so I guess, this is before I started Wild Oak Capital. So I was kind of had purchased a single-family and actually was basically getting educated on what it looks like, you know, what does that mean? Basically… well, the first single-family I bought, my thinking was if I can cover the mortgage it’s a good deal like that’s kind of where my mind was, and then I realized, you know, “Okay, there’s some mass buying this,” and then I also realize, “Well, maybe if I can scale I can do a little faster.” So I started looking around for multifamily stuff in my neighborhood, and there was a couple of duplexes, quads, that type of thing. So I would walk with my son, he was a baby at the time, I would just push him for hours sometimes as I like being outside and he enjoyed it as well as, you know like as a baby you could watch a size, look around. 

And so we’re going by I saw this older gentleman putting a “for rent” sign and what looked like a multi-unit place, I’d never been inside, of course. And I said, “Hey, excuse me, Sir, it looks like you were gonna rent the place, can I ask what your rent is?” And when he told me I kinda hit my face ’cause it was way low, you know, it’s like way below market, and I was like, “Oh, okay. Well, you know, that’s great.” And then I just kind of started a conversation and he’s like, “Oh, you know, it’s so cool to see you pushing your son,” and then he was a family man as well, older, obviously. His kids were like in college and stuff. And so we gonna just chat and I said, “Do you know? 

Truthfully, I’m not looking to rent, I’m looking to buy. Is that something you’d consider?” And it was almost like the first time that anyone ever told him, you know, and he’s like, “Well, yeah, I guess I would.” And I was, “Okay, cool.” you know, for the right price and stuff, I’d be interested. And what he said was, he said, “Well, I need like a million bucks.” And to him, that was like a monster amount of money, and me too, I mean that’s not something just sneeze that. But in my mind, I’m like, “These things are worth more than a million bucks.” So I was like, “Okay, well, let me do some numbers and let’s reconnect,” you know, I didn’t wanna pressure him right then.

00:06:23.000

WS: You didn’t pull a piece of paper or at then and start to write the contract, that right?

00:06:26.000

EN: Exactly. So I was like, “Okay, thanks for the talk.” Like can I get your number or whatever. I gave them a couple of days, called him back. In the meantime, of course, I was looking up the assessor’s info and trying to figure out as much I could out the property. So I called him back, I came to find out he had inherited the property from his parents, and his mom had lived there, and so he had like this kind of really love for the property. 

So I called him, I said, “I’m interested in the property and I’m okay paying the price you said, joking or not. I will pay you a million dollars. However, my wife and I don’t have that much to put down, have you ever considered an owner finance situation?” And he’s like, “Well, what’s that?” And so I said, “Well, you know, you basically act as the bank.” Kind of gave him the whole spiel, and I said, “the cool thing about it too, is you get paid monthly.” And you know, back in my mind, I was kind of already thinking about terms, I was like, “You can get about the same amount from my payment as you can get rent. You don’t have to do anything. And if I default for whatever reason, you just get the property back”. And so he’s like, “Well, it kinda sounds too good to be true,” like well, that’s true, you know, but there’s always some risk with that. And so the deal presented in was $35,000 down. 

So three and a half percent down, a million dollars, and a 40-year amortization and he was like, “Sure, sounds good to me.” And part of it was just the relationship, you know like talking to him and, you know, gaining his trust, and I knew his love for it, so I was like I’m gonna repair the property, fixed it up that’s why I wanna put such a low down payment ’cause I’m gonna put all of our cash to this thing and make it a little bit nicer.

00:07:56.000

WS: He was at his heartstrings right there?

00:07:58.000

EN: Yeah, exactly. He was like, “Oh, that’s great.” So then I said, “Well, can we go tour it?” You know just let him see it. So I was kind of like back in the napkin offering, and he’s like, okay. So we went in there and it was actually five units, and one of the units was empty and just filled with stuff, like His mom’s old stuff. And I’m looking around and there was plumbing, electrical, some drywall like it was ready to be kind of finished out but it just full of stuff, and so I was looking at like we got a six-unit here. 

And so anyway, so we came to terms, and I’ll never forget going to his attorney’s office, we’re sitting there ’cause he’s like, “I’d like my attorney to write it up, and so that’s a great idea. So we went there and his attorney is like, “This is… this is scary for you” talking to him, he’s like, “This is pretty risky.” And it was fun too, ’cause I even, you know, I’m not an attorney but I was like, I disagree. I think that this is risky for most lenders, but he lives down the road, I live down the road, you know, worst case, he gets the property back, like it’s not that risky. It was almost like the attorney was like, “Oh, I guess maybe that’s okay too.

00:08:58.000

WS: But you spoke up like the attorney was still sitting there?

00:09:01.000

EN: Yeah. It was all three of us in the room and I was like, “I disagree with you.”

00:09:03.000

WS: Because I think it would have been easy to have been intimidated ’cause this guy is an attorney, right, quote.

00:09:07.000

EN: Yeah

00:09:07.000

WS: You know, but anyway go ahead.

00:09:09.000

EN: Yeah, so I guess that’s true, you know, just like being… just standing up and say, “No, I don’t agree.” Anyway, so we ended up closing on these terms, and the first thing, of course, I did was get the six-unit up and running. Everything was way below rents. My personality is I’m never gonna kick someone out, so I always want, like once the lease turns that’s the time to raise rents. And so there was a period of time where we weren’t making very much money at all, just basically kind of squeezing by, knowing that when it turns, one, we can fix it up and two, we can get rents way up. 

And so over the period of time, over about a year that happened, but we got all the tenants in there and it’s often running. And that was kind of a cool, cool thing. And to your point, I would have never gotten the deal if I didn’t ask the question, so I was just walking and asked the guy, and then the same thing happened again. Basically a year later, walking down the road, saw an older woman with the house, it looked pretty cool in our neighborhood, and second, was on the way, so we had, you know he was like first was a year and a half or two or something, and then the second was on the way. And so I just, “Hey, you know, would you be interested to sell?” Almost the exact same story and she wanted to finance it. She actually had… she was like, “I’m… I’m gonna pass it on,” ’cause the note that she had was an owner finance note as well. So it’s just a really cool, like trickle-down thing. And we still live in that house to this day. We did refinance, you know, we told her in advance and stuff, it was all fine. But anyway, so I guess the point of the whole story is, be on the lookout and then, you know, of course, back in fully up. I’ve asked that question 50 times in my neighborhood, and 48 of them were like, “No. No, thanks,” or it did the price and work, whatever, but the times that it does work, because just don’t be afraid to hear no, you’re not gonna offend anybody. Say, I really love the house, you know, and would you be interested to sell and it’s not like someone’s gonna be offended, they’re just gonna say no, worse case.

00:10:54.000

WS: Yeah, no, I love that. I love just keeping your eyes open for opportunities, right? As you said, you could have just walked right by, or just said hello, right?

00:11:02.000

EN: Yeah.

00:11:02.000

WS: And not taking time to build the relationship.

00:11:05.000

EN: Yup. And I think that’s key too, ’cause you do kinda get this excitement and you’re like, okay, like you said to pull out this paper, but that’s not… it’s not like, especially if someone’s never heard the words on our finances, if someone’s never considered selling, you gotta give him the time. And truthfully, I still talk to the original owner, I mean he’s the bank, right? But I still kinda keep them, kind of tell him what’s going on and he just loves it, you know. So the relationship wasn’t also… like it was genuine, is what I’m trying to say. I wanted to know him and be honest and real with him as well.

00:11:34.000

WS: Yeah, no, I love that. Yeah, it’s just great. I just want the listeners to hear that story, so they’re looking for those opportunities there, minds wide open to that. Was that before you had syndicated anything?

00:11:43.000

EN: Yeah, so that was basically the start of my kind of multi-family journey you could say, right. So I was still kind of in that original zone of smaller multi. At this point, you know, obviously, we’re looking for bigger deals, you know, but it’s still kind of I think… I think goes to show that that type of thing could still be available on it, and if you’re listening to this and you’re looking for a small multi or single, that’s a pretty good tactic is just walk and talk to people. I don’t know if it works so well in the bigger commercial field, but I think the relationship thing is still the key.

00:12:13.000

WS: That works in any industry.

00:12:14.000

EN: For sure.

00:12:15.000

WS: I mean, they’re nearly any… One thing also I thought I was gonna meet up for a long time before I ever got into big multi-family and trying to learn, right? Trying to find the next duplex or something, you know, but there’s an old-timer in there, he probably had 100 to 125 single-family homes in this market that I live in, but he owned most of them. Frankly, he’d had them for so long, right, and he was talking about seller financing and he just like him by, and he said one night, he said, “Hey, if I can control the terms, I’ll play almost anything.”

00:12:39.000

EN: That’s exactly how I feel. That’s so cool. I’ll let you finish but I’d like to come back to that. 

00:12:44.000

WS: When you said 40 years, 40-year am I thought, wow. Okay, you, know, why did he agree to that or did he just not know?

00:12:51.000

EN: Well, I told him. I said, “You know, on a deal like this, you know, here are the more common terms” ’cause I wanted to be very upfront. More likely than not, most of these, 25, 30% down, 20 years am, 25 years, and you know that type of thing, I said the reason for the 40, I mean there’s a balloon too, so the reason for the 40 was just to get my payment where I needed to be right. And I said at the end of the day you’re still making your money, and you know, I just wanted to chip away at the least, you know, ’cause I could’ve got interested only or something. I just don’t know that he would have understood everything, so I explained it as best I could.

00:13:11.000

WS: Right. Right.

00:13:24.000

WS: I think that was a smart move, what you just said, and I think we should think about that. Like you could have maybe pushed for that, but it may have scared him off.

00:13:30.000

EN: For sure. I think, I mean there are some reading people involved, right? 

00:13:34.000

WS: Right.

00:13:35.000

EN: Understanding what’s pushing the boundary, but I completely agree with that gentleman in your mastermind. I mean, there are ways to basically make financing work at almost any number. So for example, my partner, Shane, bought a house with half percent interest. Interest-only reflect the first five years when you paid a huge number for it, but it works, right? So his monthly payments are so low that he can kinda get it up, and it was one of those religious stress properties and kind of so much story on it. It’s like not anything, but you can pay quite a bit more if the financing works as long as you have a plan in place you know.

00:14:08.000

WS: Awesome. And maybe we move a little bit too, from you know, you got into multi-family that way, and then obviously syndication, it was something that came for you, you’re doing it now. But was that something that you saw at that time? Did you believe you could go buy a 100-unit building?

00:14:23.000

EN: Absolutely not. No. And so I think this is really important for listeners too, it’s like you just don’t know what you don’t know first, and then there are these lending beliefs. I actually laid awake at night buying that six-plex. I was like a million dollars, oh my gosh, what am I dealing with? And I even called friends and mentors, I was like, “Am I doing this the wrong thing here?” And everyone I talk to was like, “No, it sounds like you have a good plan,” and you know, worst-case scenario, you default, and it’s like kind of play the worst-case scenario game. But early on, I had heard of syndication, my mentor was doing that and I just was not terribly interested in it. I think I just thought it was just so big and so, like daunting. Now, looking back, it’s kind of not, right? I mean, it’s a lot of work, it’s a lot of education but here are people out there like yourself, kind of laying out the program. It’s like, here’s what you need to do, follow these steps, they’re hard and then takes a long time, but it’s absolutely doable and so… no, at the time I wasn’t even thinking about it, it wasn’t even on the radar, but now looking back, you know, it’s all progression, right? Everyone’s different, and I’m glad I took the path that I did, but yes, syndication is kind of the way to go for me in the future because we all kind of tend to run out of capital subpar.

00:15:30.000

WS: That’s right. That’s right, especially you want to do larger deals, right? And we all wanna add a zero at the end of that. Continue. And you said it right there too, there may be a path to say but it’s not typically easy, that’s why everyone doesn’t do it, right? Speak to just some of the sacrifices maybe you had to make, and even maybe was your wife on board with this? You know, even that million-dollar project, right? I mean my wife and I would buy two triplexes, we didn’t pay near that much for them. It wasn’t in the market where they would have been worth it, and it was a very different time for many years ago, but even then we were like, “Oh my goodness,” you know, maybe it’s like quarter million or something but we were like, “Is this okay?” As you know, it was such a… so out of our comfort zone, right? So speak to that a little bit. Maybe the family life, maybe was your wife on board with that million-dollar purchase and much less moving forward to syndicating and how did you manage that?

00:16:17.000

EN: Yeah, I love this question. I’m so glad you asked because I actually made a giant mistake and I think people can learn from it. So I basically had had this vision in my head of where I wanted to go and where I wanted my family to go, and in my vision, we’re all doing it together, right? But I didn’t really communicate it well with my wife, and so even in buying that property she’s like, “Okay, cool, make a little more money,” that’s kind of how she was thinking and she’s a lot of trust in what I’m doing, but she’s not intimately involved. And the mistake I made was not communicating that vision well with her, because at some point like after, maybe after her first syndication and she was like, “When are you going to stop?” And I was like, never, like it or not.

00:17:03.000

WS: Excuse me? What?

00:17:05.000

EN: I was like, stop. I know. So I was like, okay, we need to have like a serious like date night and talk about what that question means and like what I’m doing, ’cause if you don’t see the same vision as me, I don’t wanna go there, as I wanna go together. I would rather sell everything and live in a van with you than continue down this path if you don’t agree here, you’re not interested. I mean so we did, we actually had dinner, we did like a vivid vision kind of big thing, you know, and it actually was super eye-opening for her and for me, and I wish I would have just, you know, expressed that earlier ’cause I kept… I think that she thought there was like I was like doing a lot of sacrificing, right? So I was doing podcasts at night and, you know, waking up early and kinda doing sporting, you and I share that common sacrifice, and it has slowed down now that things are kind of in place. But early on, I was just so motivated, you know, there’s a lot to do to get your first indication, and I wanted it done now, like that’s kind of my personality, unfortunately. And you know, I wish I would have explained that to her and then moreover, I wanna grow. I want to continue to grow. I think we’ve done it wiser and smarter and slower recently, kind of putting place things into place to grow. But I would say for the listeners, like express your vision and include your family as really as possibly can, ’cause if they’re not included then there’s like… it’s completely a waste of your time. Again, I’d rather not do any of it if my wife isn’t on board, so that’s for sure. And then I think to the second part of your question is like the sacrifices for family, and I think we plan to talk a little bit maybe working with my wife, but you know, just… just learning what it looks like to balance work life and the sacrifices. So to speak to that you know, yeah, again, I think there were some times that I sacrificed, but I had in my head, my kids are super young right now, and I wanna do this for a year or two and then as they grow, I wanna be super available. Now was a part of the vision too, is like having a little bit more financial freedom to be around.

00:19:04.000

WS: Appreciate your transparency, right, and I feel like I try to speak about it often. I don’t hear many people talk about, “Hey, it wasn’t easy in the beginning,” right for most of us, most of the time, right? 

00:09:13.000

EN: Yeah.

00:09:14.000

WS: Some yes, it comes easier depending on their network, where they started from, all those things, right that play a role in that, but however, it’s still very possible, right? Even if you start from nothing, no network. But man, I just think it’s such a common thing too that entrepreneurs, like lose focus on what’s the most important, right? And, I mean I’m just like you. Like man, how fast can we get there? What did it take? 80 hours? 100 hours a week? Okay. Like in my mind it was just like, “Okay, whatever it takes.” I’m not gonna keep talking about it, I just wanna go get it done, right? But that doesn’t work for the whole family, right? That is a sacrifice, but missing that time with kids or was your wife, but I appreciate you highlighting as well sharing the vision, and I think sharing the vision with my wife and my kids was very important. And when they didn’t see Dad for a week at a time, and they still don’t sometimes, but they see me more on an overall basis, but you know, for a while I think it was so helpful to be able to say, “Hey, this is… this is where we’re going,” whether for us, you know we sold the farm, whether it was like being back out on the farm or starting the foundation, you know, we’re helping families, being able to share those things was so important, right? And at a level that they can understand, right? But for my wife too, I think she’s 100% on board with my mission, or I should say our mission, like the foundation, right? The mission of the foundation helping these families, but she couldn’t care less about real estate. She’s thankful for the business, right, and she supported me 110% and I couldn’t have done it without her, but I don’t think it would have happened if we had not talked through the vision and thought about that.

00:20:46.000

EN: Yeah, a hundred percent. And I mean, first of all, I’ve said this every time we’ve talked like, “Thank you for all that you do. I mean this is like this is why I love your (inaudible) so much as there’s some reason behind it, right? And there’s a reason behind the money, so thanks for everything you’re doing.” But yeah, I completely agree and I think without my wife it would have never happened, and you know, we still have a long way to go but I appreciate you’re being honest as well, is the sacrifice you make and the reason behind it. I guess what I’m trying to say is the vision has to be there, and the sacrifice has to be understood for that to happen.

00:21:19.000

WS: You mentioned you wanna keep growing, right? And we all do, right? And so what does that look like for Wild Oak Capital?

00:21:26.000

EN: Yeah, I mean awesome question. So we had a, like a retreat of our group and we went to Mexico City. It’s kind of a long story but I promised my partner, John, that I would go to Mexico after we closed our first deal. So I was like, “You know, I got… I gotta follow up with that,” and then at the same time we kind of have, we have two other partners who join us, and so I said, “Guys, I think, you know, we’re gonna go to Mexico City. I’m hopeful that all of you can join us,” and so everyone like, “Okay, let’s go.” So we went there, we went to Mexico City and we basically laid out the next three years of like how much growth we wanna do and how we’re gonna get there. A little bit market-dependent, of course, but it’s nice to set some goals, right? So over the next three years, we’d like to acquire 2,000 more units, and I think, you know, we have a realistic view of it. It might be like 400, 800, you know, just sort of it’s gonna be a little bit exponential in growth. And maybe this next year there’s only 300, you know what I’m saying? But I think that’s the ultimate goal, is three years from now we’d like to have 2,000 units and we kinda worked backward, and I think this is actually good to talk about too, is setting goals to start with (inaudible), we all said, “Okay, what are we gonna do? How much do we wanna make? How much impact you wanna make? And then let’s work backward.” And so that’s kind of where we came to that, that 2,000-unit number. I think we could all very reasonably be super financially free that number.

00:22:44.000

WS: I love that. And even the goal-setting based on work backward, we do the same thing. I’m thinking about, “Where do we wanna be?” You know, not even two years from now, but even getting 10 years from now, are just thinking, you know, most… most time it’s not gonna be just like that, right? 

00:22:55.000

EN: Sure, yeah. 

00:22:55.000

WS: But it does help you to think differently, right? When you set bigger goals, but if nothing else helps you to layout that plan, like you’re talking about, reverse engineer.

00:23:03.000

EN: Well, for sure, ’cause if you say, “Oh, I’d like to have…” whatever. It can be me, money, right? It can be like, “I would like to have X number of dollars five years from now,” that’s a great goal you know. Two things about it though, one is why? I think that’s the most important question about a goal, why do you want more money? I talk about this a lot, money is a tool. For me, it buys time, and I want time with my kids, we love to travel. So when I set goals and then their financial, it’s not really for money, like, you know, we all kind of technically I think to want more money but it’s actually the tool I’m after, and time is the tool that I’m looking for. So you can buy more time and more travel with a little bit more of that capital, so I think having that why in mind is super, super valuable. And then again, to your point, like if you say goal five years from, “I wanna have X dollars” or whatever it is, then you gotta work backward ’cause I think if you don’t say, “Okay, what do I need to do three years from now? What do I need to do? To one year from now? Six months from now? Next month?” Like if this is headed that way, “What do I need to do tomorrow to start down that path of my goal?” And it can become super powerful and it helps you kind of like continue down the road because there are days of course, as you know, they are harder than others, because it’s “Oh, this is brutal,” you know, we’ve got to invest in final on too, and we lost out, and it’s like I just wanna turn on Netflix.

00:24:20.000

WS: Yeah, that’s right, yeah. None my mind a little bit right at the comment. So what is the biggest thing right now for holding you back from scaling?

00:24:27.000

EN: It’s the market. I mean I don’t wanna blame the market but, like here’s a very good example is last week, we were in best in final two top offers on a deal in Texas and we were all like, “This is awesome,” and the underwriting was really tight, and I’ll tell you the number, 21.5 million is our offer. The broker comes back, says it’s probably gonna squeeze to 22, you know, sharpen your pencil kind of thing. So we all got into Zoom call and I was like, “Guys, I’m seeing 22.5 as top, top, top.” I mean really, everything has to go right, do we all feel okay with this? And we all have to look our investors in the eye and say “This deal is gonna probably make money.” It was like, “Okay. Okay yeah, we’re aligned. Twenty-two and a half. Like if you gotta go there.” And then the broker calls the next day, he says, “Oh, we got four offers over 23, are you interested in jumping in again?” And so we’re all like, “Oh my gosh, this is insane.” Okay, that’s all kind of one more time sharpening the pencil, right? And I just couldn’t. I was like, I don’t see it. I don’t see how they’re paying this. And it actually traded for 22 or 24.4 with a million dollars and hard and earnest money, I think half a million-dollar is hard, and I was like, “That’s the type of environment in Texas that people are doing,” and I think maybe there’s an institutionally, who knows, right? But I can’t actually look my investors in the eye and honestly say “Yes we pay the right price for this,” so we just have to say “Thanks, but no thanks.” And that could be a little frustrating, so I will say we’re ready. I think like our investors are kinda wind up. I think we’re ready to scale, but we also wanna do right by them and be honest, and so we’re not gonna buy something just to buy something.

00:26:01.000

WS: Yeah, I appreciate your integrity and transparency as well. And I think it’s helpful for listeners to hear that and, yeah, so I think you do have to sleep well at night, right? 

00:26:10.000

EN: I know, exactly.

00:26:11.000

WS: If you want your investors to sleep well too, right?

00:26:13.000

EN: Yeah, I think, you know what’s frustrating about a spreadsheet?

00:26:16.000

WS: Right.

00:26:16.000

EN: Is that you can make it look at…

00:26:18.000

WS: Yup.

00:26:18.000

EN: Change the exit cap. I mean there’s a handful of things that… I mean you change the exit cap by even one and it’s a totally different ball game, and so without being educated on what that… what that means, what that risk is, you can make a spreadsheet look, say whatever you want it to, and it’s a pretty dangerous game. I think people are overpaying.

00:26:37.000

WS: With that one metric? 

00:26:38.000

EN: Yeah.

00:26:38.000

WS: Much less all your assumptions? 

00:26:40.000

EN: Exactly, yeah. Yeah. 

00:26:43.000

WS: Tell us a way you’ve recently improved your business and that we can apply ours.

00:26:45.000

EN: For us, it’s basically been systems. So, you know, while we’re kinda calm before the storm, I mean, so we just closed on what I said, we have two that I’ve accepted otherwise and so we’re kinda in this sort of ramp-up zone. But, leading to right now we had this, like sort of calm where we were looking at deals and nothing really was working, so we’re like, “Okay, what can we do?” So creating a really clear system, you know, like Asana. I think a lot of people use a tool called Asana. HubSpot is really nice too. Getting us all on the same HubSpot, you know, link in HubSpot to Mail. There’s just a lot of tools out there that can automate a lot of the stuff, and so that’s kind of what we’ve been working on is systematizing in communication. So we have a weekly call and just like crystal clear, “Here’s what we’re doing, a call every week.”

00:27:28.000

WS: Is there something that you’ve recently automated that’s like, save you a bunch of time?

00:27:31.000

EN: Not recently. I will say like my podcast, probably similar to you, I don’t edit, I don’t do video stuff, I have someone help me with all that and that saves a mountain of time. So when I record my podcast it truly takes about an hour, sits down, starts through the record, and then I just email the assistants and say, “Hey, here are these things ready for you” and someone else is way better at me, so to outsource that, save me mountains of time. And I think that’s true of a lot of tasks.

00:27:57.000

WS: One other question, or just a couple more for you. Run out of time. I wanted to ask you why, and it doesn’t have to be GoBundance specific, but why join a mastermind? I think it’s helpful for listeners to know ’cause it’s so important to you surround yourself with, but why did you join, you know, a mastermind? And you don’t have to go GoBundance specifically, but I can’t be sure.

00:28:13.000

EN: Sure. I think you sort of touched on it, was being in a room full of people that challenge you. You know, so in GoBundance quite honestly, there’s… I don’t know how many members, 500, 600 members-ish, and I’m in the bottom 10% of net worth and, you know, maybe experience. Maybe not quite so low, but the point is I’m surrounding myself with people who are doing things I wanna do. And you’ll be in a conversation, like two nights ago I was at dinner with these… these gentlemen and I just sat there. I don’t think I said much of anything and just soaked up what they were saying, and essentially what they were saying was, you can go bigger and you can scale, and it’s the same, it’s absolutely doable. And there are times in my normal life that you don’t get that same thing, you know, that challenge. So at home, for example, if I told someone I wanna increase my net worth X number, it doesn’t matter. People will be like, “Why do you care about that?” And that’s okay, not everyone needs to be that way, and so to get that kind of push and guidance and just like soak up other people’s wisdom, I think that’s a huge piece of a mastermind.

00:29:16.000

WS: Yeah, I appreciate you how adding that. Not all of us grew up in a… with a network of people that were high achievers, I would say, and I hate to even say it like that really ’cause you can have it and be a high achiever, right? But people who are, say, business owners, pushing themselves, doing things by thinking differently than most people, right? 

00:29:35.000

EN: Yeah.

00:29:35.000

WS: Most people and helping push you. And so it’s helpful to… are we still friends with those people? Well, of course, I mean, I just have amazing friends, but it’s very different, right? They’re not pushing me in ways that people at GoBundance push me, right?

00:29:45.000

EN: Yeah, exactly. I mean like, you know, friends at church or whatever it is, you know, it’s like you have a common thread with them there but, you know, if you said, “Here’s how much I’m paying for the next property,” it would almost be like frustrating for them ’cause they don’t understand. I think there are different buckets every life and you can go other places to get them filled up, you know, and GoBundance and a couple of masterminds, that type of thing fill my bucket of challenge in a business sense, you know, and of course, you make friends along the way too, I don’t wanna say that, but it’s like you can just get different buckets filled up.

00:30:17.000

WS: True. Eric, how do you like to give back?

00:30:20.000

EN: We talked a bit, helping with the church plant in Mexico that I’m really passionate about, and personally, I just… I enjoy missions and that world is so powerful that I like to give back to some missionary friends of mine, and then again, is this church in Mexico. So I’m pretty excited about that.

00:30:34.000

WS: Awesome. Eric, appreciate you sharing that. Grateful to have you back and always a pleasure to be in person and have an interview with you. But I just think your stories are very inspirational, I think even the focus on the family and the spouse, the vision is so important. It’s not done well most of the time, right? 

00:30:51.000

EN: Yeah, I did a bad too.

00:30:53.000

WS: But you… yeah, you got on board though. I mean you… you and your wife on board, you all had that discussion, right? That’s often not had I think enough setting those expectations and trying to understand, communicating, right? It’s all about that communication, but I appreciate your transparency around that ’cause I think we’re all gonna benefit from that. I think maybe a little differently of how we’re pursuing this business, is our spouse on board, right? You know, it’s so important. It’s so important. So grateful for that, even opening our eyes to some of the creative financing stuff or asking questions of people, right? Get to know them, build that relationship and how that… that paid you to do that. How can people get a hold and even learn more about you?

00:31:27.000

EN: Yeah, the easiest way is the website at wildoakcapital.com. My podcast is called The Real Estate Mindset. Very grateful, I have Whitney on mine too, you can check out that episode as well. It’s [email protected], anyone can email me anytime.

00:31:38.000

WS: Eric, thank you so much. Have a blessed day.

[END OF INTERVIEW]

[OUTRO]

0:31:40.0 WHITNEY SEWELL Thank you for being a loyal listener of the real estate syndication show. Please subscribe and like the show, share it with your friends so we can help them as well. Don’t forget, to go to lifebridgecapital.com, where you can sign up and start investing in real estate today. Have a blessed day.

[END]