WS1616: Find Great Opportunities in Different Niches | #Highlights

EPISODE 1616

[INTRODUCTION]

Whitney Sewell (WS): This is your daily Real Estate Syndication Show and I’m your host, Whitney Sewell. Today we have packed a few different shows together that we call #Highlights to help you to get the most bang for your time and educating you on the topics that you want to learn from. We would love to hear from you. I am grateful that you are with us today. Have a blessed day.

[INTERVIEW 1]

Whitney Sewell (WS): Our guest is Chris Odegard. Chris, welcome to the show. You have some skill sets that are going to help many of our listeners and passive investors who may be kind of stuck in a rut and maybe some money that hey, they could be doing some other things with that they have not thought about and so, I’m looking forward to getting into that and really pulling some of that expertise out of you so they can have a better understanding about that. But first, I want to learn a little more about you, where are you from and how did you get into this business?

Chris Odegard (CO): Sure. Well, thanks for having me on the show, Whitney. Happy to be here and share what I can. Well I’m originally from Cincinnati, Ohio, went to school in Daytona Beach, Florida, worked for the Boeing Company for a few years, a few years been an understatement out in Seattle, Washington.

But today I’m a prolific investor, but I wasn’t always the prolific investor. Like a lot of Americans and other people, you know, I was a conventional investor for a long, long time, investing for my financial freedom and retirement with mutual funds for 401K. And, that is a slow path to mediocrity and that point was so far away you needed to telescope just to see it. So, I was on that path for quite a few decades. And what I finally refer to as my, a liquidity event in 2009 where I lost 55% of my assets and thousands of dollars a month. And that was the end of my 19-year marriage and, all of a sudden that path of mediocrity got exponentially worse. And at 45 years old, I was like “Okay, well how am I ever going to get there or am I just gonna work for the man forever?” And then a friend of mine, coincidentally around the same time “Oh of course, that was the bank failures in the real estate market so that all was just kind of on top of that,” but coincidentally around the same time a friend of mine said “Hey, Chris you should get this book and read it.” And so I bought this book and I do the fleet, set it on my nightstand and the sat there for longer than I care to admit and then I was on a business trip, and I said I’m going to read that book.

And of course, the book was Rich Dad, Poor Dad by Robert Kiyosaki and that just turned my world upside down. And you know, I started moving in that direction and alternatives as, well, I wouldn’t say as fast as I could, as fast as I comfortably could and nine short years later, I was looking back on everything and it was like “Wow. I hadn’t made up all of that 55% and multiply that many times over” and that would not have happened with mutual funds through a 401k. 

So, that’s when I started theprolificinvestor.net and started sharing my experience with everyone, hoping to move people from conventional investments over to alternatives in some way, shape or form.

WS: Nice, that’s incredible. I appreciate you being willing to share some hard times, right, just how you thought, how to change, to how you’re thinking now and helping others do the same thing. Let’s jump right in, so what are you doing differently now versus what you were doing then? You talked back conventional versus prolific, let’s dive into that.

CO: Well, I was 100% conventional investments back then, now I’m 95% alternatives.

WS: What is that? For the listener that may be kind of new to that or maybe they’re thinking they may be in a conventional type of investment, but not really realize that’s what it’s considered there, that there’s some kind of alternative. 

CO: Yeah, so everything that’s publicly traded – stocks, bonds and mutual funds, those are conventional investments. Everything else is alternatives. So, you know, your stocks, bonds and mutual funds, CDs, things like that and then, you start looking at alternatives, that’s everything else. That would be things like notes, every segment of real estate – whether it be single-family or apartments or commercial, cryptocurrency, precious metals, investing in business equipment like ATMs, or earth moving equipment, the energy sector – natural gas, oil, coal, stuff like that, and being a shareholder of a business, but private shares not public shares. And believe it or not, cash value, life insurance is something that should be part of everybody’s portfolio and of course, what you do, being a syndicator raising money and putting deals together, those are all alternatives. And it’s funny when the conventional investor goes to a financial planner and they build them a diversified portfolio of stocks, bonds and mutual funds, it’s not diversified at all. They’re only in the paper asset class and they don’t have any of the other good stuff.

WS: Yeah. I appreciate just some elaboration, right, what is considered conventional versus everything else. I just think it’s great to even help us to think outside that box a little bit, often we’re raised to just think about the conventional ways. I know I was, and most of our family it’s like “Well that’s just what you do,” right? You’re not even exposed until you read that book Rich Dad, Poor Dad. You obviously just aren’t thinking that way, you can’t see outside this box. 

And so, let’s help the listener think outside of that box a little bit, right. It can seem very complicated, it can seem a little scary right because maybe that’s not what we’ve been exposed to. The more I’ve learned I would say it’s the complete opposite. I’m scared to invest in that. But dive into that a little bit and let’s help the listener think through maybe what they have in the conventional ways that hey, they could be using it in a different way.

CO: Well, sure. You mean talking about some of the investments themselves or what are the advantages, disadvantages?

WS: Yeah, just helping to think through alternative versus conventional and, how they even move from conventional to alternative investments.

CO: Right. Some people become alternative investors by accident and the example that I would use is they’re starting young family, they get that first starter home, they get over the home, get the down payment by the house and then a handful years goes by and the family’s bigger, they’ve outgrown that house, they move up to the next one. And some people sell the first one, but some people just go “Why don’t we keep that first house and buy the second one will rent the first one out.” And boom they’re an alternative investor, and they get all the benefits, better returns, built-in tax efficiency, the ability to ensure your asset, the ability to use the leverage against. All of a sudden with one little investment they’re an alternative investor and they’re getting a ton of investment. So, if we can show people how superior alternatives are, maybe they can make a purposeful move in that direction and see what they’re missing out on.

WS: No doubt about it. Just thinking outside that box like you’re talking about and making that shift. So tell us a little bit about, maybe there’s some examples of folks that you’ve worked with recently or that you’re helping, they were in this conventional but now they’re doing some alternatives. How do they do that? Maybe the 401k, somebody has a 401k but they’ve not thought about being able to use that, how do they do that?

CO: Well, I’ll use myself, and I’ve translated this to other people. I was part of a networking mastermind with the alternative investments awhile, quite a few years back and like a lot of conventional investments, I had a ton of money sitting in a 401k. And, the government says you can invest your 401k and IRA money in almost anything, there’s only about three or four things that you can invest in, if to the administrators of those plans that lock you into stocks, bonds and mutual funds. So, I’ve been working with Boeing Company for a couple decades and was making this shift and, of course I had this capital locked up here which I thought I couldn’t use and the guy who was in this mastermind group said “Chris, ask your employer if you can do an in-service transfer,” and I said, “What’s an in-service transfer?” He said “Well that’s where you’re younger than 55 and you’re still employed, they will let you move some of your money out of their 401k into another plan, and then you can put it into a self-directed 401k and invest in real estate or notes, whatever you want” and I kind of laughed and probably rolled my eyes because here’s my thinking like “I’ve been working here for decades. If this were possible, certainly, I would have heard about it before.” Well, I was completely wrong. 

And so, the company allowed me to take their entire company match out and after a couple of decades that was not an insignificant amount of money. And, that kind of helped jumpstart me in that and then a couple other friends that I talked to, did the same thing. But, I’ve been working on it for decades, this is just kind of like hidden right there on the open. All you have to do is ask the question, but you’d have to know that, so that’s one example. That’s kind of one of those things where I’ve learned the old saying if something seems too good to be true it’s probably not true, well I go the other way. When you hear something like that I go “Man, what if that is true?” And like run toward that stuff instead of running away from.

WS: Yeah, and I think it’s interesting, like you said, all you have to do is ask the question but oftentimes you don’t know what you don’t know and it’s hard to even know the question to ask, right? And that’s what we’re hoping obviously to expose the listeners to as well today. Maybe speak to some pros and cons there, that you’ve learned after making that switch or, you know, what pros and cons have you learned and even others that you’re working with. 

CO: So, I compare conventional and alternatives across 13 categories, and alternatives win on 11 of the 13. So, I’ll go through a couple ones that I think are really interesting. People wouldn’t think of buying a house, and then not getting insurance for the house. And, I was a conventional investor, you spend a lifetime pouring money into stocks, bonds, mutual funds in your 401k, and you have no ability to ensure. If you buy a single-family rental, you go to your insurance broker and say “Hey, I’d like to ensure this asset against loss, this really expensive thing,” and yeah they will do it. Matter of fact, if you use leverage to buy that property, the bank will require you to have insurance. Now, you think you put way more money into your 401k than you ever put down on a house and it’s completely unprotected from anything and I go “Well, insurance companies are pretty good about looking at risk. What is it that portfolio is so risky that they won’t insure it?”

And another example is leverage. If I want to go and buy a small apartment building, I can go and say “Hey you know, will you loan me $400,000 to buy this $500,000 apartment building?” and as long as me and the asset and everything lines up they’ll say yes. If I go to a banker and say “Hey, I’d like to borrow $400,000 to buy a half-a-million dollar portfolio of stocks, bonds and mutual funds” after they get done laughing, you know, I mean, what is it that bankers look at this suppose it asset and say “There’s no way I will lend against that.” 

Now conventional investors will argue with me about trading on margin but they didn’t acquire that portfolio by borrowing it. Basically the margin training is kind of a line of credit after they’ve already acquired the asset. So, I think those two things are really interesting and then just one more, the S&P 500 index is kind of the benchmark of one of them over the overall stock market. Historically since its inception, the S&P 500 average annual tournament is about 9.8%. The studies have been done about how much the average equity investor makes in the stock market and it’s a little bit more than 5% before taxes and inflation. So, talk about being on a mediocre path, you know, on a slow path and mediocrity if you’re only making 5% before inflation and taxes, you’re probably not even maintaining buying power in your conventional portfolio. And in the alternative world, 15 to 30% returns are just commonplace for us and some people’s minds just explode when you talk about numbers like that.

WS: No, that’s awesome. That list of pros and cons there’s just great. Just think the operators and the passive investors that are listening to know just as we speak to investors, right. It’s great to know those things so we can help explain it.

But how would you explain that? Was that, you know, as the operator, and I take many investor calls, right I mean every week just talked to so many investors and people on our team do as well. But I want them to better understand how to explain that to someone who’s brand new to this, right, so we’re speaking to that investor in there like 401k, sure I’ve got one but I didn’t know I could do anything like that. What are some things that we need to be prepared for or to be able to explain? Maybe we talked about a little bit of both things, how do we answer that question?

CO: So, you’re trying to basically take mostly conventional investors and use their fears about moving into your syndications. Well a key though, before the call we were trying to talk about my superpower and I call it making complicated things easy so I’ve created something called the hierarchy of investors. And it came to me when I started my blog in 2018 and people say, “Well, Chris what are you trying to do?” and I said “Well I’m trying to take people from the bottom and move them up to top” and what I thought about was Maslow’s hierarchy of needs, you know, where you start out physiological and safety and then eventually you get to self-actualization. 

Well the hierarchy of investors, at the very, in the shadow of this pyramid, in the shadow of the pyramid you have, and I call it in the shadow in the dark, you have the conventional investors, they’re not even on the pyramid right and then you get on the period and then on the pyramid then you’ve got the notes and the real estate and all that stuff is on there, and then off to the side I’ve got these 13 categories showing where the advantages are and this might be a good a tool. Like I said it’s a picture, it’s on one page, it might be a helpful tool to show them all the advantages of what you’re trying to get them like you want them to move in that obviously it’s good for you but everybody wants to make money at this and so that something that might be helpful. 

[END OF INTERVIEW]

[INTERVIEW 2]

Whitney Sewell (WS): Our guest is M.C. Laubscher. He’s an educator, and his passion is to share how investors and business owners can create and recover warehouses and multiply cash flow through advanced cash flow strategies. Have you figured out how to escape the rat race and replace his income through cash flow investing, he shares how you can do the same through cash flow investing strategies? M.C. is the founder of Cashflow Ninja and the creator and host of the top-rated Business and Investing podcast. Cash Flow and Cash Flow Investing Secrets. 

I’ve known M.C. for a few years now, it’s been incredible to see what he’s done in our space and how he’s helping others think about cash flow strategies. Right. So now he’s written a book, The 21 Best Cash Flow Niches book. And He elaborates on three of those niches today that we don’t talk about often, that maybe you should consider adding to your portfolio, but I know you’re gonna learn a lot and enjoy the show today. 

M.C., welcome back to the show. I know you and I have crossed paths at a few conferences or speaking here and there, and have got to catch up much lightly, but I’ve enjoyed the last few minutes actually just hearing more about what you’ve been up to and some success you’ve been having and things you’ve accomplished. It’s incredible. And one thing recently, I know we’re gonna jump into today. But before we do, in case the listener hasn’t heard of you before, tell them more about your focus, your business model strategy a little bit and kinda how you got to where you’re at right now, and let’s dive in.

M.C. Laubscher (ML): Absolutely, thank you so much for having me on. This is a blast to connect again, my friend, I to see you, and congrats on all of your success too. Thank you for listening. Just a little bit about me. So my name is M.C. Laubscher. So I’m an investor entrepreneur, I have several businesses, but most people are probably familiar with my platform called the cash flow and ninja, and I’ve heard of me through that platform, I’ve kinda took some crazy colors and throw it together and got a crazy little ninja, and at the cash loan injuries essentially started out as a podcast, is about five and off almost six years ago, and it’s grown into an educational company, I’m very mission-driven, a purpose-driven through the cash flow injure to help as many people as possible to become self-reliant through actual education, so we share a lot of different strategies on their mostly cash flow strategies, and we assist them ensure information to empower them to escape the rat race through casual investing strategies, so that’s one of the businesses than one of the platforms that folks might have heard or have seen me on.

ML: And then I have invested in several other businesses, so I also have a company called Producer’s Wealth, where we consult virtually with clients all over the United States, and we help them implement and execute Banking Strategies and help them set up their own banking system in 30 days or less, and then we also have… I have another company called Producers Capital Partners, where we assist folks investing in cash-flowing basements such as multi-family, such as resorts and other investments and so forth. So that’s a little bit about me. And that’s what I’ve been up to. We’ve been keeping busy. 

WS: That’s for sure. No doubt about it. That’s only incredible to see your growth just over the last few years and… Or more people that you are helping. I think through cash flow strategies, we should be strategizing about different methods of cash flow and how to do that best, and it’s incredible to have somebody like yourself that’s researching and educating and thinking about all these things all the time. Often, many of us are our passive investors gonna have time to drive in and educate ourselves about every one of these strategies, and thankfully, must have recently written a book as well, and we’re gonna dive into that today, but the 21 Best Cash Flow Niches book.

WS: And so I encourage you to look that up for sure… Maybe you can hold it up. Absolutely, that’s got those amazing collars on it again, so that’s great, but we’re gonna dive into a few of those niches today, but something other than single-family, multi-family, which we talk about often, EMC has really become very educated about many different niches, and now he’s helping many others to help do that as well, but let’s dive into a few other niches today that we wouldn’t normally discuss that you have seen to be so helpful to other passive investors. 

ML: Yeah, absolutely, and this has been a lot of fun because I’ve mentioned, I started my podcast cash flow and in 5 and off six years ago almost, and it’s just been incredible to have been able to interview the baselines and business and investing, and this shows pretty white, meaning we cover a very wide variety of topics, so we’ve talked about businesses, we’ve talked about real estate, we’ve talked about commodities, we’ve talked about paper assets, we’ve talked about crypto and blockchain assets, we actually started covering that in 2016, if you familiar, not… So we’ve been looking at all these different types of opportunities and investments from the best lines in business and investing, and the number one question that I get when people talk to me is…

ML: And you’ve had over 700 people on your show for almost six years now, like what are some of the best opportunities that have been shared on your show? So it’s a really good exercise. We continue to produce content so much that sometimes you forget about everything that you’ve shared or covered on your show, so it was actually a fun exercise writing the book is I eventually said, You know what, I’m getting this question over and over and over, I’m gonna put it all together in a book for folks and just share the 21 best cash flow niches, and of course, I throw in five bonus that is there is to narrow down to 21. It was hard. And of course, we are listeners and viewers. Marketing 21 is better than marketing 26. I don’t know why it is that way. It’s like when you look at numbers 5, 7, 10, 20, 21, and then anything above that. It’s hard to market it. (Unless it’s like 100, right?) Yeah, there you go. You almost have to go to the next one that seems like, Oh, 100, this is 100, so… But yeah, was a lot of fun putting it together and breaking it down and trying to just dive into 21 of these niches, and of course the five bonus niches, but some of the ones that I think that would be very interesting for your listeners of your viewers ’cause there’s a lot of real estate and masters listening to your show is one thing that I found quite incredible was agriculture investing.

ML: And agricultural niches specifically. And it was very intriguing, and I listened to a couple of those shows. Again, is… I’m like, This is very intriguing because you could, of course, by farmland, by farms, you could look at… Folks have shared on my show how to invest as a syndicate in the farming business and livestock and so forth, and certain crops, and then there’s also folks that have shared how to invest into coffee parcels where coffee beans are being produced and also co-goal… And this is also off-shore to which adds a different element to it, so now it’s not just agriculture, it’s offshore agriculture, which gives you a little bit of diversification, but one, I would say area within agriculture, that was covered on my show, which was very intriguing was actually timber and specifically teak, and this intrigued me. So I looked into it, and then I discovered as I’m doing my research and learning more about it, that tech’s been included in a lot of university endowments like Harvard, Princeton, Yale, it’s held by a lot of hedge funds, there’s folks like Ted Turner that owns thousands of acres of teak, specifically trees and agriculture.

ML: And I thought this was very interesting, and then I looked at this and I said, Why? That’s usually a… My thinking process works is I look at what very wealthy and successful people are doing, and then I look at this and I go on, but why are they doing this? Well, it’s of course very interesting as an investor to look at this, that it’s tea trees five years ago, they just grew 10 years ago, they just grew 15 years from now, they just grow and 20 years, so now they’re still gonna grow and of course, it’s not a get-rich-quick scheme. By any means, it brings an investing approach as an investor of this very long range. Long View generational approach. So then when I looked at it like that, and I said, ‘Well, this is not surprising at all, why family offices love this and endowments love this, and all of these very, very wealthy investors and families have invested in teak because they have a long-term vision and view, they think multi-generational, not just while they’re alive, right? They see themselves as just stewards of the family capital, and that is money managers and endowments and hedge funds kind of see themselves as well. So that was interesting for me to look at.

ML: And then the other thing that really popped out to me when I looked at this is it provides a great balance in a portfolio, so if you’re an investor and you’re kind of sprayed across the couple of asset classes, like businesses and maybe a lot of real estate investments and so forth. This is a really good recession-proof, just niche because it provides that balance… Real estate goes up down and sideways, businesses can go up down inside was a… Just in different types of environments, whether it’s inflationary, whether it’s deflationary, the trees just grow, they keep growing as greater… Are there… And they’ll continue to grow. So I found that it was fascinating in agriculture, and there’s so many different niches in it, but specifically that teen… And obviously, I go into debt, the book about it, but I thought that one was fascinating. 

WS: That is fascinating. I remember I’ve had a few people on our show as well that talk about syndicating livestock and land and crops and trees, things you’re talking about, and even offshore, I didn’t have a clue first, so I was like, I didn’t even thought of this, and it seems like there’s more people doing it than you think, but it’s just one of those things, if you’re not exposed to it, you just don’t see it, but then now it’s. Like you mentioned, there’s farmland, there’s livestock, crops, coffee timber, all these different things, and could be an amazing steady investment and even offshore, like your time has so many different dynamics to it that you could add your portfolio.

ML: There’s quite a number that I’ve invested it in, and the reason why I’ve been able to do that ’cause folks usually say, Well, shouldn’t you just pick one and focus… My line and my focus has been people finding the greatest people in different niches, learning and studying everything that I can and immersing myself into a space before I invest my money there, so… Yeah, there’s what a number… The crypto by some… Obviously, I’ve been an investor and over the past 20 months, I would say that I’ve been so immersed in it to learn more and study more, because I believe there’s a huge opportunity there. I look at the California Gold Rush strategy, where during the California Gold Rush, it wasn’t necessarily the people that came there and Doug or panned or try to mine gold, it was actually a lot of the entrepreneurs and business owners that sold equipment, picks and shovels and clothes and shoes like Levi Strauss and housing and food and financial services like Wells Fargo, right, the wells family, those folks all come out of the California Gold Rush, the same opportunity exists there.

ML: So that’s one that I’m investing in. Another one that I think that might be interesting for real estate folks is in the hospitality industry, which is one of the niches actually, believe it or not, most folks would go… Are you getting hospitality right now? Yeah, it’s getting absolutely slaughtered and I don’t necessarily… With my paradigm and worldview, I don’t necessarily think it’s coming back either, because I don’t think business travel is going to resume as it was prior to 2020, which is a huge part of hospitality and conferences. Business meetings and so forth. I think the world’s kind of adapted to the Zoom World ride and doing zoom conferences, but there are niches within hospitality, the short-term luxury rental space is on fire like a Hammond team. And I think it’s only getting started, folks have changed their habits, they’ve changed how they travel, they changed how they vacation, they would drive somewhere three to four hours or maybe even up to six hours from where they live in vacation there were then getting on a plane and going somewhere, and it’s the same thing, another niche within the hospitality industry that I’m a partner and investor in that I’ve thoroughly enjoyed a historic resorts, close to major markets.

ML: The business plan is built on weddings, that’s how you get the people to the resorts, then you have a winery, you have a golf course, you have a hotel, you have restaurants on the property, so because they’re there for the wedding, they enjoying all of the ancillary and symbiotic cash flow revenue streams that the property has to offer, and that’s been phenomenal, I cannot believe the success that we’ve had on the properties that we’ve been involved in over the boss 20 months in the story, the resort nice, where most of hospitality has been designated we cannot literally keep up the one property, we’re actually selling out a hotel in the same area because all of our rooms are constantly. Solow helped them fill up their hotel too, ’cause we’re getting so much traffic to the property, so yeah, so obviously there’s a lot of other different niches, you mentioned real estate and multi-family, I’m a big fan of multi-family and what’s going on in that industry, and right now, I mean it’s a phenomenal place to be, and I think it’s gonna be a great space to be for another couple of years, so there’s always going to be a need for quality affordable housing, for sure.

[OUTRO]

Whitney Sewell: Thank you for being with us again today. I hope that you have learned a lot from the show. Don’t forget to like and subscribe. I hope you’re telling your friends about The Real Estate Syndication Show and how they can also build wealth in real estate. You can also go to LifeBridgeCapital.com and start investing today.

[END]