From Ninth-Grade Dropout to Real Estate Tycoon: The Lumberjack Landlord’s Journey | Jake & Gino Podcast

[00:00:11] Hello, everybody. It's Jake Cenzano, host Jake and Gino Podcast, here with my co-host, a multi-family mentor, the coach of Jeff, the father of six, the best-selling author, the G-Daddy. Gino Barber, Gino, how's it going? Jake, I'm doing good, brother. How are you doing this morning? Always making it happen, big man. Wow, we just got a lesson there in the Northeast, but we have a very special guest today. Today's guest is Matt, aka the Lumberjack Landlord. He's a ninth grade dropout, but he turned his challenges into fuel.

[00:00:40] It's going to be like a two-stroke mix for the chainsaw, I'm guessing. Now he helps others do the same with his program. Oh, shit. I'm a landlord. Now what? So, without further ado, Matt, welcome to the show.

[00:00:52] Matt Lundgren I'm super pumped to be here with you guys. I'm excited to get through it.

[00:00:56] Matt Lundgren Get through it? Dude, you got to be present and enjoy it, mate. Lead into it.

[00:00:59] Matt Lundgren Oh man, we're going to crush it. Yeah, get through it with you guys. I'm loving it.

[00:01:03] Matt Lundgren So let's hear a little bit more. We're going back and forth a little bit, but ninth grade dropout.

[00:01:09] Matt Lundgren You then got into W2. Maybe share that a little bit because, I mean, you said you're 47.

[00:01:16] I think it's getting easier, but when you're kind of coming up through the ranks to get a good job,

[00:01:22] especially 20 years ago or whatever, you're supposed to have a college degree.

[00:01:25] So I'd love to hear a little bit more about that.

[00:01:28] Matt Lundgren Yeah, I heard that a lot.

[00:01:30] But yeah, you're exactly right. I mean, now it's very different.

[00:01:34] Matt Lundgren You know, now the biggest concern is our company's going to have enough employees,

[00:01:39] right? Because everybody wants to do side hustles and turn that into their empire.

[00:01:43] But back then it was, yeah, I mean, a lot. I heard a lot. Hey, listen, you know, we, you know,

[00:01:49] this is a college, this is a college program. You need to have a college degree if you want to work

[00:01:54] here. And so I was a dropout in the ninth grade, single mom. Not me, but my mom was. And, you know,

[00:02:04] so, so dropped out, worked hard, really got into sports memorabilia because I love sports. And so I did

[00:02:10] that. And that's how I supported myself and, and helped out the family.

[00:02:14] Matt Lundgren You were like ripping King Griffey, King Griffey Jr. baseball cards.

[00:02:16] Matt Lundgren Yeah, yeah. Yeah. Yeah. Right around that age. Yeah. So it was, it was,

[00:02:20] it was Griffey and Thomas and all those guys. Yeah. The big hurt. Love the big hurt. Underrated.

[00:02:27] But, but yeah, that's what I did. And that's how I made my money for, for a few years. And then

[00:02:32] realized I had to get a big boy job because that was nice and that was good, you know, money as a

[00:02:38] teenager, but I had to get something real. And so moved out of my house at 18 and just figured hard

[00:02:44] start it. And that's what I did. Hard started and worked with a, uh, worked at a video store.

[00:02:51] I hated that job with, and was making $5 and 25 cents an hour. So I was making nothing.

[00:02:57] Matt Lundgren Like Blockbuster or like the local blockbuster?

[00:02:59] Matt Lundgren I was doing a local one. Yeah. Local one. Yep. I was, I couldn't,

[00:03:02] I couldn't get a job at Blockbuster.

[00:03:04] Matt Lundgren You didn't have that degree, man. You need a GED for that shit, right?

[00:03:08] Matt Lundgren Yeah, exactly. I couldn't get a job at Blockbuster. So that was that. And so

[00:03:12] worked for the video store and, um, and worked with a woman that worked at a software company.

[00:03:17] And, and I thought what everybody else does, which is, Oh, you build computers. That's not what I do

[00:03:21] at all. Um, but that's what you get as an answer for a real long time until the world became a whole

[00:03:26] lot wiser as to what software was, but, uh, worked with her. She said, Hey, come in, they're hiring for

[00:03:31] a job. She didn't tell me it was a telemarketing job. I went in, got the job as a telemarketer. And

[00:03:36] the first one year contract I signed was for $18,500. Um, and that was it. The rest was history.

[00:03:43] I basically started working that and I blew every number away. And I talked to all the experts that

[00:03:47] were there and all the seasoned guys and, uh, blew away every number, broke every record that they had.

[00:03:53] And six months later I was in a rep role and, uh, my very first full month in sales, uh, made 10,000

[00:03:58] bucks and the rest was history. I was like, man, if you're a good salesperson, you can make a lot of

[00:04:03] money. This is easy. Um, and so that's what I did. So 27 years later, this February, um, or 26 years

[00:04:11] later, this February, I actually retired. Ogmandino Gino is it? Ogmandino? There you go.

[00:04:18] When did you fall in love with real estate? Um, so after I lost all my money in the.com bomb,

[00:04:25] uh, I had, I was taking the money that I had. I was not a spender. I was a saver. And so I was

[00:04:30] putting my money aside, putting it into the stock market with my other fellow software, uh, sales

[00:04:36] guys. And, uh, then all of a sudden, right. That's what you're doing. Yeah. Well, this is what you do,

[00:04:42] right? You get a 401k. That's the way to do it. That's the only way to do it. 401k. And you start

[00:04:47] saving money and putting it into stocks. And, um, you know, that's what the conversation is at the

[00:04:52] lunch table. And that's what the conversation is at the, you know, at dinner afterwards. And

[00:04:56] that's what I did. So I put my money into that. And then the.com bomb happened in the course of 60

[00:05:01] days. I watched, uh, you know, 27, $29,000 portfolio at 21, 22 years old. I watched it evaporate and go

[00:05:11] to almost zero, you know, less than a thousand bucks. That did not feel good. Um, and so I just

[00:05:19] started kind of thinking and I said, you know, I need to do something differently. I need to do

[00:05:22] something different than what everyone else is doing because I don't want to be subject to these

[00:05:26] swings, but I was young. I was in my early twenties. Um, and so I just started looking, what is that

[00:05:32] asset? You know, what's something that I can buy that actually increases in value over time and all

[00:05:37] the while pays me while it's increasing in value. I kind of liked that idea. I also needed something

[00:05:42] that was slower moving. I believe that the guys in Manhattan, and if you live in Manhattan,

[00:05:47] you have an edge over everybody else because you're hearing the stories of the bars,

[00:05:51] you hear the hush numbers, you hear what other banks are working on. And that wasn't ever going

[00:05:56] to be me. So I felt like it was an insider's game. So based on it being an insider's game,

[00:06:01] I just said, you know what, we're going to, we're going to do something different. And so, um, I

[00:06:06] went to, was still thinking about that, but then needed to move because I was too far from work.

[00:06:10] I got a better job and I actually, uh, tried to buy a place. I couldn't afford one. Sound familiar?

[00:06:16] Um, couldn't afford to buy a place. And so I started looking for a roommate and I was

[00:06:21] like, I talked to the bank and I said, Hey, if I get a roommate that's willing to pay rent,

[00:06:24] can we count their rent towards my mortgage? And they said, yeah, of course. So that's what I did.

[00:06:29] I found a roommate and I said, Hey, where do you want to live? And he's like, I'd like to live in

[00:06:32] this area. I was like, all right, then that's where I'm searching. So long as it's within 30 minutes,

[00:06:36] so long as it's within 30 minutes of my, uh, my job. And so that was it. That's how I bought my

[00:06:41] first place. I signed a, I got a roommate, signed him onto a lease, provided that with my

[00:06:45] financials to the bank. And that's how I bought my first place. I house hacked.

[00:06:49] Jake, you want to ask a question? No, I was just saying he was, he's, uh, serving the

[00:06:53] customer from the early days, right? He didn't care about the house for himself. He said,

[00:06:56] I need the cash. Where do you want to live? But exactly. I was like, Hey, where do you want

[00:07:00] to go? Very customer focused. That's what I'm just saying. Yeah. You know, that's, I appreciate

[00:07:04] that. I mean, without customers, I don't have any business, so it kind of works out that way,

[00:07:09] but that's what we did. You bought that first deal. And then how did you continue to scale

[00:07:13] after that? Great question. So, you know, it was, that was, you know, kind of going into the

[00:07:19] heydays of the market, right? You know, you start, you start seeing no, uh, Oh three Oh four.

[00:07:27] So I bought that place in, in like Oh two and then kind of Oh three Oh four things started to heat up a

[00:07:32] bit. Um, and then I was like, you know what? I don't want to drive. I don't want that commute

[00:07:37] anymore. I don't want that. You know, I don't want that anymore. And so I told my roommate,

[00:07:40] I said, yeah, I think I'm going to sell. Um, and right before I made the decision to sell,

[00:07:45] I got hit with a $70,000 special assessment cause it was a condo. And I was like, well,

[00:07:49] there goes all that equity. Um, and then I realized, okay, now I'm never going to buy a

[00:07:53] condo again. Um, because we got hit with a specialist assessment that was 70 grand that

[00:07:58] I was going to have to pay. That was all the equity that I made in the house.

[00:08:00] Holy shit. Yeah. Yep. The builder per unit owner. Yeah, yeah, yeah. The building,

[00:08:06] you can see like 70,000 spread across everybody, but, uh, no, it was,

[00:08:10] I was able to rebuild each unit. They had to, they had to reskin the entire building

[00:08:15] because the builder used a product that wasn't supposed to be used within five miles of salt

[00:08:19] water. And we were right on the water. We were, we were, uh, in a, in a tower right on the water.

[00:08:24] And so they looked at it and it was like, you stuck out or something. No, they had to pull

[00:08:28] all of the facing off of it. So it was not only the, it was not only that, but it was the framing

[00:08:32] underneath it because that's what was corroding. Holy shit. Sorry. Yeah. The structure.

[00:08:39] Yeah. The straw. Yeah. I mean, you know what? It is what it is, but it helped me keep it.

[00:08:43] No, I sold it. No, still sold it. Still sold it because what I had to do is I wanted to get

[00:08:48] into something where I was like, I don't have a condo fee. I don't have to worry about this

[00:08:52] ever having a special assessment again. So that's like a nightmare story for someone

[00:08:55] young and doesn't have money. It's some shit like that happens. I literally was like calling banks

[00:09:00] going, uh, will you give me a loan? They're like, no, no. I was like, well, this is what I need it for.

[00:09:06] They're like, no. And that was even the two banks that were trying to help the building out.

[00:09:10] But I was the youngest in my building. There were a hundred, about 120, maybe in the building.

[00:09:16] That's a lot of money back then. You're talking seven mil. Oh, it was, I think the total project

[00:09:22] ended up being like $11 million to Reese. Cause they had to do that and the windows and all of the

[00:09:27] everything. It was a nightmare. And so I learned, you know, so what did I learn in three years? I

[00:09:32] learned don't invest in the stock market and don't buy a condo. Holy shit. You're ahead,

[00:09:38] you're ahead of about 80% of the population. There you go. Yeah, exactly. So it was just,

[00:09:42] so that's, you know, I was blessed that that happened early on in my career. Yeah. It almost

[00:09:45] broke me, but I didn't have a family. I didn't have kids. You know, it was just me. It was like,

[00:09:48] I could have slept in my car if I needed to. It didn't matter. Um, but it was just one of those

[00:09:53] things. Yeah. Horrible. I didn't, I mean, imagine what that, you know, the 70,000 on the building and

[00:10:00] then, you know, not getting that equity. And then the 30, I lost in the market. That's a hundred

[00:10:04] thousand dollars, 26 years ago. That makes you a multimillionaire today. And I had to just restart

[00:10:09] twice. This is a word to the wise. It is a cautionary tale for everybody here, you're living

[00:10:15] in Florida. What's going on with condos right now. I almost purchased a condo three years ago,

[00:10:20] but I was like, Jake, I don't like monthly recurring bills. I don't like an HOA fee of a thousand

[00:10:25] dollars on a $700,000 asset. It's $12,000 a year. That's just HOA fees. That's not property

[00:10:31] taxes. That's not insurance. So if you have no mortgage city and county taxes in 90% of condos,

[00:10:37] right? Cause you're like, so you're looking at like, and then insurance at the time just

[00:10:41] escalated. So thousand dollars a month for an inexpensive condo. Now all of these special

[00:10:46] assessments are going on. I think the valuations for condos are going to get completely whacked in

[00:10:52] Florida is what happened with that condo that actually collapsed. The vast majority of them

[00:10:56] are underfunded. So when you're going in, this is just anybody listening to this, you really need

[00:11:01] to get a condo for a great price. And if you can Airbnb it, you're okay. Cause most of these condos

[00:11:07] don't even allow you to Airbnb maybe once a year. So if you're going with that strategy, just be

[00:11:12] careful. And, and all the HOA fees is one of those fees that doesn't go away. And if you don't pay it,

[00:11:17] that is the highest lien, even higher than the bank. So you have to pay your HOA fee no matter what.

[00:11:24] And it's interesting as things get tough and these things go into foreclosures, well, everyone else

[00:11:29] has to start picking up the HOA fees. So your fees will only continue to go higher and higher. So I'm

[00:11:34] not telling you not to buy a condominium, just go in there with eyes completely wide open, make sure

[00:11:39] that they are well-funded, make sure that they have a CapEx account, make sure there's not a lot of

[00:11:43] deferred maintenance, the elevator works, the roof is newer, the HVACs don't have to be changed,

[00:11:48] the parking lots, the painting, just make sure going, going eyes open.

[00:11:53] Gino, it's, it's interesting because these condo HOA associations in Florida that were,

[00:12:00] you know, like the one that you described, low funded, didn't keep up over time. You had a bunch

[00:12:05] of residents that didn't want to pay the fee, right? And they probably had a weak HOA board that

[00:12:09] didn't want to fight it. And they just let it, I mean, these, these are just residents within the

[00:12:12] building, right? So if you're going to buy into a condo, think about that perspective, because if

[00:12:21] it's a low fee and it's an older building, chances are you might have trouble down the road. Whereas

[00:12:26] you're going to have to pay it either through a special assessment to his point, or you're going

[00:12:31] to be paying a monthly to keep it up in good condition, because it's not like your house where

[00:12:35] you may do some of this stuff, you may sub some of this stuff out, right? This is going to be subbed

[00:12:39] out. Everything's subbed out in a similar way to almost a hotel, right? That's, that's condo

[00:12:44] living. You hands off. You don't want to do anything if it's run properly. So if it, if

[00:12:48] there's a low monthly, I would be wary of that. And so if you're going to do it, make

[00:12:53] sure you have the money to actually do it and know that you want that because you want that

[00:12:56] low, uh, you know, kind of. There's trade-offs. Yeah. Yeah. The low maintenance, the, the,

[00:13:03] the, the, I don't have to really fix much because it's being taken care of. That's what it is,

[00:13:06] but you got to pay for it. Right? Yes. I agree. Matt, as you're looking at assets nowadays,

[00:13:11] how has your strategy evolved from those early days of just, I guess, buying anything, buying

[00:13:17] anything that made sense, maybe seller financing, whatever it takes to close the deal. How has that

[00:13:22] evolved over time for you? Well, I think that, you know, uh, I think that that's, what's been

[00:13:27] great about my journey is not, it's not really evolved. It's just been more and faster. Um, you

[00:13:32] know, I felt like I, I really picked, you know, spending as much time as I did on the front

[00:13:36] and kind of figuring out what I wanted my strategy to be. I knew I didn't want it to be HOA, you know,

[00:13:41] condos or houses. I knew that I didn't want to be single family houses because single fault

[00:13:45] tolerance, right? Most people need both incomes to be able to pay the rent. And so when one of those

[00:13:52] people loses their job, guess what happens? They're still not paying their rent. So I much rather be in

[00:13:57] a multifamily, small two, three, four unit residential loan type. Um, and that means that

[00:14:03] it is based on comps, which means I can find something where it's undervalued because of what

[00:14:10] else sold. And it, it has the opportunity to be a much nicer asset. So really what my focus was,

[00:14:16] you know, in being, and in trying to get the cheapest debt, you know, Fannie Freddie passed that

[00:14:21] rule where they said, you can't have 10 mortgages. You can only have four. Well, I already had five at the

[00:14:24] time. And so it didn't work for me. So I said, the only other way that I'm going to get additional

[00:14:29] assets is one way and one way only. And that is move into them, find a way to fix them up while

[00:14:35] I'm living in them. And then gives me the opportunity to do that. Um, so that's what,

[00:14:40] that's what that house. So that's what the house has strategy really did for me was I could move

[00:14:44] into it. I could fix it while it was in it. I could then rent out the side that I fixed up. And then I

[00:14:48] moved into the other side and I fixed that up while I was living in the other side. Um, you know,

[00:14:53] there were times when I went with no toilets and no showers and no kitchens and you just,

[00:14:58] we just roughed it and figured out how to make it work. But I think small multifamily two, three,

[00:15:03] and four unit stuff is absolutely the best assets to be in and house hacking. I think that people too

[00:15:10] often say, I'm finally ready to get out of my apartment and buy a house. You're used to sharing

[00:15:15] walls anyway. What do you care? Like buy a duplex, buy a triplex, buy a quad. And you know,

[00:15:20] if you have four buildings and you do those over a 10 year period, what did you really lose in life

[00:15:26] opportunity? You'll create so much more life opportunity for a majority of the rest of your

[00:15:30] life. If you make that early on sacrifice, I think far too many people are getting fixated

[00:15:33] on, I want to buy a single family home.

[00:15:36] Gina, real quick, I want to say something on the marketplace for those size units.

[00:15:41] So we're, we're buying hold investors. We very rarely sell. We sold out of Kentucky simply because

[00:15:48] we didn't like the laws that changed during COVID. So we exited about 500 units out of Kentucky, but

[00:15:53] besides that we typically hold, I will say this though, for that, you know, two, three, four,

[00:15:59] six unit size multifamily, there's a great market because there's a lot of first time people

[00:16:05] that want to get in. And I think you can get a premium on those types of assets if,

[00:16:11] if you know what you're doing. So I think, you know, even though that we typically don't sell,

[00:16:15] I think if you, you are in a position where you need to sell something, there's typically a good

[00:16:19] market on resale for the, for those type assets. So I do like, you know, they're, they're a little

[00:16:25] bit more liquid than some of the other multifamily assets. You can get out of them quicker if you need

[00:16:29] to, which is nice.

[00:16:30] Yeah. And I think that's the key for me is, is that, you know, guys that have, you know, 500 unit

[00:16:34] accounts. Right. And it's like, they, they might be in seven assets that can be challenging to

[00:16:39] liquidate a portfolio in that type of a market and not have to take at least.

[00:16:43] Well, it depends. It depends that we're in the market cycle, right?

[00:16:46] Absolutely. A thousand percent. Right. And that duplex is always liquid. Even in a bad market,

[00:16:51] that duplex is always liquid. That triplex is always liquid. The quad is always liquid,

[00:16:56] especially if you're an actual owner, you know, owner occupant, that thing is always liquid and,

[00:17:03] you know, let's face it. I believe that the market's going to take a tumble. It coincidentally

[00:17:08] will likely be right after the election. Um, it's being propped up, I think pretty artificially

[00:17:12] right now. I think we're in for some tougher times in 2025, even the end of 24. Um, and I think

[00:17:19] that people, you know, that are living paycheck to paycheck, I think that they're more likely to lose

[00:17:25] a paycheck in that household than they ever have been, um, over the course of the next, you know,

[00:17:30] I mean, we see it continue to take up, um, and the numbers that's, if you believe them or not,

[00:17:35] but I see it, I see all, I, I, I'm still a hands-on guy. So I see all of the applications that come in.

[00:17:40] I see all the credit scores. I see all the debt loads. I can't remember the last time I saw somebody

[00:17:45] that was less than a 35 or 40% DTI. Can't remember the last person I saw like that.

[00:17:52] You know, it just doesn't happen.

[00:17:53] You, you live in a market that has those types of assets. So somebody listening to this may say,

[00:17:59] well, I live in the Southeast, all the newer assets. I don't have small assets in New,

[00:18:03] in New Hampshire where you live, the buildings are older. They tend to be built a little bit better.

[00:18:08] And so understand it is part of the market cycle, but it's also the assets that you're focusing on.

[00:18:13] We're not here to tell you to buy duplexes or quads. If you live in a market that has bigger assets,

[00:18:18] I would like to buy bigger assets if I could, because I started out with the smaller assets

[00:18:22] and Jake and I went full. You always tend to start smaller because you don't really understand what

[00:18:27] you're doing. You start with a four or five. We started with a 25 unit. Then we went to a 36 unit.

[00:18:32] Then we went back down to, then we did 136 units. Then we went back down to a 22 unit. So you need

[00:18:38] to find your comfort level and especially where you're operating or where you'd like to operate

[00:18:43] and then focus on that strategy. But I need to ask you, you know, you said you met your wife,

[00:18:47] you have a melodious voice in church choir. What was she saying? Hey Matt, I'm living in this house.

[00:18:54] We're fixing it up and we got to go to the next day. That's got to be challenging early on. And how

[00:18:58] did you show her the vision of- You need that ride or die change, you know? That's what it's about.

[00:19:03] Values alignment. I mean, literally, I mean, on our second date, I literally said to her, I said,

[00:19:08] Hey, so I've got a good job now. I really enjoy my job, but I'm in my twenties and I doubt that I'm

[00:19:15] going to enjoy my job and all the pressures that come with it in my forties or certainly not my

[00:19:19] fifties. And I said, so I invest in real estate now. I've already got five properties. That's going

[00:19:25] to be how I retire early. So if you need to think about that, that's fine, but that is not something

[00:19:30] I'm going to abandon. So no getting in. And that was a very serious conversation on the second date,

[00:19:36] but we kind of, you know, after the first day, we're just kind of like, this just feels right.

[00:19:40] And so I had that conversation. She's like, Nope, I get it. And so she was somewhat on board.

[00:19:46] The first place that she saw after we got married that I put an offer in on,

[00:19:50] she actually walked out of the show and crying. And I just said to her, I said,

[00:19:55] what have I ever not fixed it and made it right? And she goes, you're right. And so yeah,

[00:20:03] she, she got through it. I don't want to be part of this.

[00:20:05] She was, yeah, she was great, but yeah, she, she, she recognized real quickly that,

[00:20:11] um, that I was going to do it and that we needed to do it. Um, and so she was a part of

[00:20:16] the solution, not part of the problem. You know, when we had some big catastrophic event,

[00:20:19] she wasn't like, see, I told you so she was just like, all right, so how do we fix it?

[00:20:23] So yeah, my wife is amazing. Yeah. She was just a team player from the word go, no matter what it

[00:20:29] was. And she was like, we're willing to do it. And I said, if you want to be a stay at home mom,

[00:20:33] where you get to stay at home and the kids can go to whatever schools they want, we can do whatever,

[00:20:38] any things that we want, we're going to need significant income to do all those things.

[00:20:42] And this is how we're going to get there. So I could see Matt.

[00:20:45] What are you smirking for over there, Barbaro?

[00:20:47] I'm just planning my mind. I can see Matt, his wife is on the balcony and he's saying to himself,

[00:20:54] I'm going to serenade her. Can we please fix this property up? And she's like, Matt,

[00:21:08] I love your vision. Let's do it, baby. That's exactly how it went down. I guarantee it, Gina.

[00:21:13] It's close. I mean, it's close. No, no balcony.

[00:21:15] All he had on was a tool belt too.

[00:21:17] Yeah. Yeah. Yeah. No, no balcony. And the neighbors were throwing stuff at me while I did it,

[00:21:22] but that's cool. Yeah. It's because they wanted you to put some clothes on.

[00:21:25] Yeah. I was like, don't make me come over there. I will come over there. Don't make me come over

[00:21:29] there. But yeah, it was great. Team player.

[00:21:32] It's interesting because people think that it's get rich quick and you're in your twenties,

[00:21:37] you've got five assets. And if you're getting rich quick, you're going to get poor even quicker.

[00:21:42] I think that's what people don't understand because I think you need to be able to build the muscle.

[00:21:47] I think you need to understand what cashflow is. And I'm going to ask you the question,

[00:21:51] what are some of the big mistakes you see members joining your group? But I think for us,

[00:21:56] there's two big mistakes. I think maybe Jake can pine in real quick on this, but the two biggest

[00:22:00] mistakes I think that we made or I made early on was I didn't treat it as a business. I thought I

[00:22:05] was just buying assets and there's no systems, there's no processes.

[00:22:08] That's everybody. That's the biggest mistake everybody makes.

[00:22:11] Yeah. And I think the other biggest mistake was that we're buying everything. That's why we created

[00:22:15] buy right, manage right, finance right. Because every new investor is like, I got 10 grand.

[00:22:20] What should I buy? What's a deal? And I'm like, if you got 10 grand, you're the deal. You need to

[00:22:26] invest in yourself. You need to have skin in the game and yourself and understand what an asset is.

[00:22:31] You need to understand what you're buying, what your goals are. You need to work on some personal

[00:22:35] development before you start putting money out and buying these assets. And I think those are the

[00:22:39] two biggest mistakes. Mr. Stenziano, what say you brother? What mistakes? What are the mistakes

[00:22:42] we make? No, the personal development thing, people could take that the wrong way of self-serving

[00:22:48] because we have an education company, but I'll be the first to tell you, I probably logged,

[00:22:54] I don't know, something ridiculous, like 10 hours a week of business books for like five or six years

[00:23:05] when I was doing my outside sales job. Every hour in the car, I was like ridiculously disciplined.

[00:23:11] And then you and I did like many different coachings over the years. So it's like,

[00:23:15] it could sound self-serving, but it's not, you have to develop your mind because what you're taught

[00:23:20] in school is not going to translate to business success in the real world. It's like polar opposites.

[00:23:27] So, you know, look, there's a million different ways to do it. We're not saying, you know, work with

[00:23:31] Matt, work with us. If you want to, that's great. This is not a plug here, but you're going to have to

[00:23:35] develop your mind. If you went the traditional route, like you went to school, I don't care if it's

[00:23:39] private school or whatever. You're not built for the business world until you do the self-education.

[00:23:46] And I firmly believe that. So I wanted to tag that on there because it might've came out like,

[00:23:49] oh, we're plugging ourselves, but we're really not. You need to develop your mind and create,

[00:23:54] you know, a positive mindset that's growth oriented before any of this shit's going to work.

[00:23:59] And Matt, before you answer that, the reason why I say that is like Jake said,

[00:24:03] you're not born with these skills. I mean, we're at 500 units. We don't know how to scale a company.

[00:24:08] So we go to traction and we go to scaling up by Ed Varnish's company.

[00:24:14] What's his name, Jake?

[00:24:15] Vern Harnish.

[00:24:16] Vern Harnish. I'm sorry. So we use them for two years and it isn't cheap, but if we don't use Vern

[00:24:21] Harnish's company, we are not sitting at 1800 units right now with over eight employees. It's just not

[00:24:27] happening. We probably would have lost a ton of money in the process. So I'm not here to tell you,

[00:24:31] you need to, I'm not here to tell you to join ours, but I'm here to tell you, you need to join a

[00:24:35] community. And if you want to learn how to buy self-storage, find somebody who is really doing

[00:24:40] it and doing it, you know, find a guru. I can see that Matt's a guru, Jake and Gino are gurus.

[00:24:45] We're doing it as we're, you know, educating and creating these communities. So that's really

[00:24:49] important. Matt, what are some of the mistakes that you've seen investors make early on?

[00:24:54] Yeah, I think you guys are dead on. I think that, you know, businesses only grow as far as their

[00:24:58] systems and processes will take them. You know, if you, if you look at, I know, cause I'm,

[00:25:02] I was a corporate fixer. I would go in and I would say, this is what your limit,

[00:25:06] these are what your limitations are. And they're almost always self-inflicted. You know, it's just

[00:25:11] like, well, this is the way we do it. Why? Cause that's the way we've always done it. Excellent.

[00:25:16] Are you willing to change to make more money? Well, of course I am. Well, here's the changes.

[00:25:20] I don't know if we want to do it that way. Exactly. I don't know. Okay. Then don't do it that way.

[00:25:24] It's all good to the road. It's the road. Yeah, exactly. So that's why it's got, you know,

[00:25:27] you gotta be able to, you have to have systems, have processes. There's a reason my course was

[00:25:33] named, Oh shit, I'm a landlord. Now what? I was sitting at the closing table. I had no idea what

[00:25:37] an estoppel is. I didn't have tenant contact information. I didn't have emails. I had no

[00:25:42] idea what any of these things were. I hadn't, you know, called in for the last, you know, water check

[00:25:49] to get that final water bill. I hadn't set up the electricity. So the electricity was going to be

[00:25:54] off in that building the next day. Literally I'm sitting there going, shit, I'm a landlord. No,

[00:26:00] I have no idea what to do next. And I think that, you know, the small multifamily or single family

[00:26:06] with an ADU, because you can do single families with an ADU all over the country. Those are pretty

[00:26:10] straightforward. And that's what I talk about the modern day duplex. The modern day duplex is a

[00:26:15] single family with an ADU because that's going to get you the income that you need. So as I'm going

[00:26:20] through that process, I'm literally looking at it going, I have none of the information that I need.

[00:26:23] In fact, I'm looking for this sheet of sheet rock and it's not lost, but this sheet of sheet rock

[00:26:28] is basically, you know, this is, we'll see if you get a good view of it. This is your purchase

[00:26:35] window. It's bleaching out on the, on the camera, but we believe it's there. I think it's like a

[00:26:40] scroll that was lost in national treasure, but I know it's, it's on there. Is it? So here you've

[00:26:44] got your purchase window, but here you've got your maintenance window. You know, it's 30 times,

[00:26:49] 20 times the size of your purchase window. So, so many people spend all their time on purchase,

[00:26:54] purchase, purchase, purchase. And then they're surprised when they suck at managing their asset.

[00:26:58] They're surprised when they have tenant turnover. They surprised when they have

[00:27:00] more than average maintenance calls. Well, it's what you said about treating like a business that

[00:27:05] people look and it's like, I got to buy multifamily because I want to diversify this.

[00:27:08] I think, okay, great. It's your point, the point of your program. Now, what are you going to do once

[00:27:13] you know, like they don't think that's far ahead, right? It's important to note though,

[00:27:18] managing an asset and writing an asset management book, it's not sexy. I mean, go out and listen to

[00:27:23] all the multifamily, you know, gurus out there. I can say we're probably one of the only groups

[00:27:28] out there that has buy right, manage right, and finance right. Everyone's focused on buying and

[00:27:35] financing the assets where we like to focus on the managing part, whether that's asset managing,

[00:27:40] self-property managing, self-doing it yourself or third party. That's a really important component

[00:27:46] to it. Buying the assets is probably not the hard thing. Actually increasing NOI and managing a

[00:27:51] portfolio is what's really challenging. And it seems as if that's what you're focusing on as well,

[00:27:55] correct? Yeah. I mean, I really, so I think that the buy right, I think so many people do the buy

[00:28:00] side. You know, there's a thousand different ways to do it, whether you're doing, you know,

[00:28:03] sub two where you're doing a wraps or you're doing seller financing, or you're doing bank

[00:28:08] financing, or you're doing owner rock financing. There's a thousand different ways to get your butt

[00:28:12] in the unit. And that's not, truthfully, people think that that's the biggest challenge in the

[00:28:16] beginning. That's just where you begin. The biggest challenge is you own that property and day one,

[00:28:21] you get an emergency phone call with a leak. What's up buttercup? What are you doing now?

[00:28:27] You know, do you have a list of plumbers that you know that you can count on? Do you know how to fix

[00:28:31] a leak? Do you know the first thing about it? And neither of those to me are a good solution.

[00:28:36] Yeah, exactly. And I think, and I think the key to that though, is, is that, you know, A is, you know,

[00:28:41] are you in your own area? Are you investing in your own area? So that might not even be an option.

[00:28:46] So I think the biggest thing for me was managing. I think Gino said it perfectly, which was

[00:28:50] you either have, uh, you know, somebody that's actually your property manager that you can count

[00:28:55] on to do that stuff, but you have that network set up beforehand. Um, or you have an actual

[00:29:01] property management company. The key is I don't want a property management firm making more money

[00:29:07] on my asset than I make. I am diametrically opposed to that as, as an idea. So the only way that I can

[00:29:14] do that is if, if I find a way, what we do is we call it in-source property management. We allow you,

[00:29:20] we, we show you how to in-source the ability to manage your assets and your properties,

[00:29:25] but you've insourced it. So while the end buck starts with you, you're not having to constantly

[00:29:30] manage this, you know, manage this property manager who may be good or not, but a lot of them suck,

[00:29:35] as you know, just like real estate agents, a lot of them suck. Um, and so I think the key to that

[00:29:39] is really understanding which path am I going down, setting that up before you've actually bought

[00:29:44] a house. So you know who your go-tos are and then managing through that process. Um, you know,

[00:29:50] Hey, what does it cost to fix that? I have no idea, right? How often do people have any

[00:29:55] idea what something costs? They're the ones that end up being suckers and pay $2,000 for a $300

[00:30:00] service. That's the type of stuff that I want to spend my time teaching people, which is this is how

[00:30:05] you always get a fair price for the work that's being done. This is how you always get the work

[00:30:10] done quickly and efficiently. And that's what actually base basically get you on a better page

[00:30:17] with your tenant as well. So I just think that on the day-to-day management of things,

[00:30:21] I think that 90% of landlords, you know, need a whole lot better of a plan of how to manage their

[00:30:28] asset, not only from a bank side of things, but also from an actual human interaction with how

[00:30:34] they work with their tenants and how they address maintenance issues.

[00:30:37] Two points before I ask you the last question, before going to the short answer. The first thing

[00:30:41] is that landlords need to have a paradigm shift. You're not buying an asset or you're not starting a

[00:30:47] business to provide for yourself. You're buying it to provide for your resident or your tenant. And

[00:30:51] once you understand that life changes, it's like, wow. Okay. I'm not buying this because I like this

[00:30:56] house and it's cute. It's got granite. You're buying this house because the people that live

[00:31:00] there need that place. They need a safe, affordable, clean place to live. Once you understand that,

[00:31:06] that's truly important. And I think once you start buying these assets, you start saying to yourself,

[00:31:11] I need to manage them and run them like a business. Now, when you're looking at property management,

[00:31:17] are you using any type of technologies, any kind of property management software,

[00:31:20] anything that's helping you to manage these assets?

[00:31:23] Yeah. Up until about 60 units, we were a spreadsheet. That was a bad idea. That was not.

[00:31:30] That was horrible.

[00:31:31] Yeah. We've been there.

[00:31:32] Yeah. And so then I went to, I went to Doorloop. I like Doorloop a lot and it gave us the ability to

[00:31:38] completely 100% automate our business. We spent time setting it up. We've added a lot of things

[00:31:43] onto it, kind of connections and hook-ons to it. But the core product was there that gave me that,

[00:31:49] basically that ability to transact in their platform, but then use other ancillary products

[00:31:55] that I added onto it, which helped me automate. So it made my life a whole lot easier. And the

[00:32:01] amount of activity that I had dropped probably 80% because we were able to automate stuff.

[00:32:07] Thanks.

[00:32:08] All right, gang, let's take a quick time out to hear from our sponsor.

[00:32:11] Now we have had a great run in multifamily going from zero units to over 250 million in assets.

[00:32:16] That's over 2000 apartment deals that we've been able to purchase through our framework,

[00:32:21] buy right, manage right, and finance right.

[00:32:23] Now Jake and I, we created the Jake and Gino community back in 2015. We launched our first book,

[00:32:29] Build Our Profits. And since then, our students have closed over 60,000 units. That's over $4

[00:32:34] billion in assets that they've been able to close over the last six years.

[00:32:38] And that's why this community has been so successful. We call it results-based education,

[00:32:42] and we pour back into the community everything that we've learned on our journey from zero to

[00:32:46] 2,000 units and all our systems and scale that we use on our very own property management and

[00:32:51] investing companies.

[00:32:52] Jake, I love that. It's not just education, it's implementation. So what I want you to do,

[00:32:57] click on that link down below, apply to work with our team, see how we can help you on your journey

[00:33:03] in multifamily.

[00:33:05] All right. We are back. So I'm not totally clear on this. So do you run your own property management

[00:33:12] company?

[00:33:14] So we aren't a property management company, but we do manage all of our own properties.

[00:33:19] How's that make it more muddy for you? So basically, I have a couple of 1099s that I use.

[00:33:28] And I also have, we have one employee, but we did that for other reasons. My daughter had cancer and we

[00:33:33] needed healthcare when I retired. So that's why we actually had to hire an employee because

[00:33:38] we couldn't get access to the doctors that we needed to without actually starting a company.

[00:33:43] So that's the only reason that we started the company. But it's just 1 PM. And he's the only

[00:33:50] employee that I have. Everybody else is 1099s that we basically just bring in task oriented

[00:33:56] to items. So yes.

[00:33:57] So I think you have your own property management company with one employee that relies heavily on subs.

[00:34:03] Yep. Fair.

[00:34:05] Yeah.

[00:34:06] Yeah.

[00:34:07] So you're saying you had a bolt on. So are you using property mill?

[00:34:10] No, not using property mill.

[00:34:12] Okay. This is the, we're looking at it right now. What about, do you have a maintenance

[00:34:16] coordinator, like a VA maintenance coordinator, or is it being done by the property manager?

[00:34:21] Well, that's the part that we automated. So we have all of our, all of our tenants.

[00:34:27] This is one of the things that we teach in our course is all of our tenants actually have

[00:34:31] a emergency number that they can call. They can also text it. And so that all comes into

[00:34:36] a bucket. And then depending on what it, which Avenue it goes is it alerts either one of the

[00:34:41] 1099s or it alerts, it alerts the PM and alerts me too, unless I shut off alerts. But it alerts us

[00:34:47] and then it gets allocated and then scheduled for something to be done or completed. But that process

[00:34:52] is a hundred percent automated because it comes through in text. But if they call, it also does,

[00:34:58] it does not only does it record it, but it also transcribes it. So right away, they can see anything

[00:35:04] that comes in exactly what the issue is. And if it's something that can wait until wait until

[00:35:07] morning, if it was after five or something that can be wait until tomorrow or until we can schedule it,

[00:35:12] or if it's something we need to drop whatever we're doing and get to it. But I've got two people

[00:35:16] that are on that essentially a primary and a backup that way, if something comes in,

[00:35:21] they see it right away and then it can get scheduled.

[00:35:24] So I was waiting for this to happen organically, but apparently has not.

[00:35:28] So can we get to the firework part of the show and you tell us the lumberjack story?

[00:35:33] Because that never came out. We're just calling you a lumberjack. You got the beard.

[00:35:38] You know, is this, is this all no cattle or is there a story here?

[00:35:42] There's a story. Um, when I, so being from New Hampshire and working in Massachusetts,

[00:35:47] um, and how witty they all are. Um, they were, I showed up in plaid, something like this, but

[00:35:55] layered, um, and showed up and what's that? So, um, to my office. Okay. This is everyday wear

[00:36:07] right here. Show up to my office. Like, Oh, what are you a lumberjack? I was like, and that's how it

[00:36:14] started. And everyone started calling me lumberjack. They're like, Oh, whatever lumberjack. I was like,

[00:36:18] all you need to worry about is the board and the fact that I'm dominating you, you know? And so that

[00:36:23] was how we lived life. And so I was a elite sales guy for a couple of decades, um, before I got into

[00:36:29] senior management. Um, but that's how the lumberjack, that's how the lumberjack thing started.

[00:36:33] You can handle a chainsaw though, right? I can. Yeah. Okay. All right. Yeah. Like no

[00:36:37] much business. I'm not carving, I'm not carving, I'm not carving bears out in front of my house,

[00:36:41] but I could, if I needed to. He's got a, he's got a carved chair out in the front lawn,

[00:36:44] you know, from, um, any, any, um, tips on scaling, uh, the business, you know, and anything that

[00:36:55] really made a big difference that we want to share with the folks.

[00:36:57] Yeah. I mean, I think for me, you know, I, I purposefully scaled more slowly

[00:37:02] because I wanted my assets to be ready to be walked away from and only minor maintenance.

[00:37:10] So a lot of what I did was making sure that the unit wasn't perfect, but it was clean, safe,

[00:37:17] upgraded, ready for the market. And you know, systems had been done, stuff had been taken care

[00:37:23] of. Everything had been fine tuned. That's one of the nice things about when you house hack is that

[00:37:27] you get to do that in that house for a year. So you know how everything works, you know how

[00:37:31] everything should work, you know, everything has been maintained, everything has been brought up to,

[00:37:34] up to snuff and where it needs to be. And then it's just regular maintenance thereafter.

[00:37:38] So I think the easiest way to scale is where you're not constantly, I look at when you move

[00:37:44] on from one building to the next, that if you left a bunch of stuff that still needed to be done,

[00:37:48] then you're carrying baggage with you. And you get to a certain point where you can only carry so

[00:37:52] much baggage and you're like, now I'm overwhelmed, but you're overwhelmed by 10 units and you're

[00:37:57] overwhelmed by 10 units because you didn't take care of them the right way. So that's when I think

[00:38:00] people too often are looking for the next deal. And what they need to do, we have three steps,

[00:38:06] acquisition, stabilization, and optimization. Most people get acquisition, maybe get to

[00:38:11] stabilization, but optimization is a four letter word for most people. But that's where I want

[00:38:16] people spending their time. I want people spending their time getting from stabilized to optimized

[00:38:19] because you can get something stabilized, completely ready. So you can move out and move

[00:38:24] on to the next asset. And then you can optimize little things here and there over time. But I think

[00:38:29] far too many people move on to their next project before the previous one's really done and kind of

[00:38:33] bulletproofed and ready for the market and ready for renters where they're not going to place a bunch

[00:38:38] of maintenance calls. Any book recommendations, any education that you've absorbed in the last year

[00:38:45] or two that you want to share? A lumberjack landlord course. That's fantastic if you want to start the

[00:38:50] right way, in all honesty. A lot of people are looking for mentors. You guys see it, right? How many people

[00:38:55] need mentors, need mentors, need mentors? And the amount of money that you spend on education

[00:39:00] from the right educators will save you tenfold in a few years' time. And so I'm not, honestly, I'm not a big

[00:39:09] book guy. I'm a big doer guy. I like watching the process of other doers. And that's how I learn. I don't

[00:39:16] learn from reading a book and then trying to apply it. I learn far more from people that are doers in what

[00:39:21] they're talking about. And then I know that they have that firsthand experience. That way when they say,

[00:39:26] oh, go do this. You're not like, yeah, you've clearly never done it before. Right? So I'm a big

[00:39:33] watching doers guy. And if I'm seeing you do it and I know how you've done it, okay, now we're talking

[00:39:38] because now I know that I just have to replicate that. What are you, a lumberjack? I am. It's true.

[00:39:46] Gino, take us home, dude.

[00:39:48] So yeah, lumberjack, Matt, at the age of 15, he's like, I don't want to go to school. I got to get

[00:39:55] myself a job. I'm not even qualified to work at Blockbusters. So I got to work somewhere else

[00:40:00] making five bucks an hour. I meet this lady.

[00:40:03] 525. I meet this lady. She's like, I got a job for you. I'm in software. And Matt's like,

[00:40:07] oh, you make computers? She's like, no, it's software. Damn it. There's a difference between

[00:40:11] hardware and software. So he goes and works. He makes 18 G's his first year telemarketing. You know,

[00:40:16] the guys that pick up the phone and go, hi, hey, may I help you? That kind of thing. At that time,

[00:40:20] we were still in America. They weren't in India. So he was in New Hampshire doing his gig.

[00:40:23] And all of a sudden, he falls in love with real estate. He meets his wife at church. On the second

[00:40:29] date, he tells her, you know, honey, I love you with all my heart, but I love this real estate thing.

[00:40:35] And in the next two decades, I'm going to be leaving my job and I'm going to be getting the

[00:40:40] real estate. Are you on board? And she thankfully said, yes, I'm on board. I see your vision.

[00:40:45] Matt starts house hacking, one little house, another little house. And before you know it,

[00:40:50] after 20 something years, this year in February, he leaves his job with over 50 buildings and he

[00:40:56] starts building his platform as well. So listen, kudos to you. I mean, it's the long game. And you

[00:41:02] know, one thing I need to reiterate from your story is everybody out there, Matt is the small giants

[00:41:07] of the multifamily space and he is not outgrowing his infrastructure. He's working on his three-step

[00:41:14] framework, which is really important. You're buying these assets, you got to manage them. And then

[00:41:18] ultimately you've got to optimize them. It sounds like a great story and a great framework for your

[00:41:24] life as well. Yeah. Thanks guys. Well said G-Daddy. Our pleasure. Gang, as always, we believe in buying

[00:41:29] deals for the long-term. Think in decades. I'm Jake. He is the G-Daddy and that's the Lumberjack.

[00:41:34] We'll see you next time. Thank you.