Welcome to Cleveland Real Estate Investor. On this podcast, you'll hear about every aspect of the real estate investment business. You will talk to your rockstar investors about their businesses, how they built them, where they came from, and where they're going. Who am I? I'm Joe Lieber and I've made millions of dollars from the real estate investment business over the last 20 years. If you're ready to hear the good and bad from a guy who's learned this business from the school of hard knocks and get educated by some bad ass entrepreneurs, then put your helmet on, strap on your chin strap. Let's ride.
Hey guys, what's going on? Thanks for tuning in today. Hey, let's talk about money in partnerships today. I think these can be good. I mean, it can be bad. I screwed them up over the years. I did a lot of wrong stuff, but now I'm getting a little older, a little more seasoned. Now I know how to make them work, how to make them work. Good. So I'll tell you a few things today and maybe some of it'll resonate with you and you won't go down those same ugly paths that I did all those years ago. You know, these things work good guys. When you have well-defined relationships, everyone has to have their role. You don't need two cooks in the kitchen. He had a cook and the assistant cook, that's it. That's how it has to work. Okay. A brick down the real estate, one person should bring the money and then one person brings operations and operations.
(01:49): Meaning, you know, day to day running the rehab, managing the tenant, following up on water bills, rent collections. These are good 50 50 relationships because what I have done that, where it's worked is I might have an, I shouldn't say I'm not doing this right now, but what I've done when they worked in the past was Auburn a restaurant, bring money to a deal. They'll bring purchase price and rehab. It's a good deal. They feel comfortable because you're already buying the house at a discount. And I wouldn't necessarily give them interest on their money. They would just get half of the profits or half of the rent. And it worked out to be a very good, attractive deal and rate of interest for the investor. And they have no problem doing this stuff. If you have a good relationship with them, they want a place to park money.
(02:38): I see that now, now that I have evolved from the operations guy to the money guy. I love all my joint venture partners. I put money in deals. They're running day-to-day operations. It's secure. I have the deed to the real estate. This concept can work very, very good. You have to have a good operating partner though, in order for it to work. You know, there's a period of time where I had like 20 houses with a partner and we were running this concept. And I was like on the end where I was like, man, I don't know if this is such a good deal. I'm working my off on these things. I'm running around constantly with turnover, running to eviction court, dealing with code violations, dealing with contractors. And I was like, he's getting half of the net income. And he just, the money guy isn't doing anything.
(03:30): And I was like, you know, starting to feel like I gotta get out of this. And then I had another real estate investor, his name's Joe McCall. I'm sitting in a mastermind meeting with him. He said to me, nah, man, your mindset's wrong. You're looking at this all wrong brother. He's like, what really is going on here? This is the one for one concept. He buys a house cash. It's one for him. He buys the second house cash. It's the one for you because you have a 50 50 deal. So really what's going on here is you have 20 houses. You have 10 that he owns free and clear and he bought you 10 that you own free and clear. And all you're doing is running some operations that really at that time, he's like, you need to systemize better and have better systems and processes. So you're not making yourself crazy. And actually it's a really good deal. And I was like, dude, you're right. That's a good one. That's a good nugget. That changed a lot for me at that time, I was like, this is good. So that concept can apply. Now if you're one of these dudes sitting over here, like I get into real estate, I don't have any money. Well, so you got to partner with someone at 50 50. You want to get into the game or not. And if you
(04:46): Use that concept, he buy 10 houses. Really someone bought you five houses because you're 50 50 on them.
(04:52): All of them. It's cool. There's a lot of people out there that want to lend money. There really are. We know one pure eyes and start asking around and you put yourself in situations. People with money are always looking for a place to park it. I have noticed that the more and more I get around people who have real money around these country clubs, these yacht clubs, these places, money's a topic of conversation. Everybody wants a good, solid place to place money with a good, solid operating partner. I see that clearer now, more than ever now that I've evolved. You know, I was always the operating partner for years and years, but slowly that switch is happening for me now. And I look for guys all the time. You know, my eyes are wide open. Is this good? Solid dude is trying to get into the game.
(05:42): Can he run a project? Is I want to learn how to run a project. I wish I was able to find guys like me 15, 20 years ago, probably what took me a lot further than where I'm at right now. You know, hard to learn all these, you know, but,this is the cool thing about podcasts, right? You can hop on here and get to hear my most intimate thoughts and all the things that I screwed up and you get to hear them and correct and change. And if you're a go getter, you're listening to this stuff. You're listening to books and tapes and podcasts getting down to it plus. Cool. So yeah, you know, if I were you wanting to get into the game, maybe you're in the game already and you're having,having challenges, you know, Oh, something's not clicking.
(06:27): Maybe need more deal flow. Maybe you need more deals might be a good time to look on taking on a strategic partner for one part of it. Maybe you have money. Just want the operations. Maybe you have operations. Just want the money. Maybe you're a contractor. You can partner with a money guy. There can be some massive, massive opportunity. There. I'd love to have a contractor partner. I could bang out these rehabs. I love my guys, but it takes some time to do this. Man. I've met some guys that can really hang in bang over the years. And when you're trying to buy and sell property, I mean that can be time and money. It's important. The time of money, the faster you go, the faster you can turn that money. I mean the higher rates of returns you're going to get. It's really a big deal.
(07:08): When you look at that annualized, you know, it takes you. If you do two flips a year with 200 grand versus you can do four meaning, wow, you can really get a hell of an ROI. And it's all about the speed. Speed is important. So yeah, time and money, man. I just want to talk to you guys about it a little bit today. Time, money partnerships. It's all important just to keep your eyes wide open. You don't have to do everything by yourself. I'd say something else I'm doing right now. Here's a good one. I'm doing Google ad words. Pay-Per-Click Facebook ads, all three of those things. I don't know what I'm doing. So I hired the best. I got somebody doing it for me and that's not a partnership, but it's worth it. Can't screw up every aspect of this business anymore. Trying to save money, figuring out how to do ad words. Silly. Don't do that. Hire the pros are the best. It's cheaper. Well, that's it guys. Thanks for tuning in today. Have a great day.
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