BiggerPockets Real Estate Podcast - 821: From Making $48K/Year to Millionaire By His Mid-30s w/Ryan Tseko

Episode Date: September 21, 2023

Ryan Tseko became a multifamily millionaire by his mid-thirties after giving up his previous career to invest. By the time Ryan was thirty, he already had twenty-one rental units, paid off over six figures in student debt, and used his pilot job to scope out new property markets. Everything was going to plan until a once-in-a-lifetime opportunity presented itself. Ryan left everything and made the jump. But how did Ryan end up in his multi-millionaire position? How did he go from house hacking “crash pads” for pilots to helping manage one of the largest real estate portfolios in the country? A better question—how did a commercial pilot become Grant Cardone’s right-hand man? Ryan’s story is unbelievable, but it’s true. In today’s episode, Ryan will share why he gave up his high-paid job to bust his butt working for Cardone Capital, why Grant Cardone told him to sell his ENTIRE real estate portfolio, and the two-minute deal analysis Ryan does that instantly tells him whether a property is worth pursuing. Ryan proves ANYONE can go from nothing to much more than something—and you can, too! In This Episode We Cover: Becoming a millionaire by your mid-thirties and turning active income into passive income  House hacking, “crash pads,” and how to make money off of your first home Paying off six figures in student debt and why you MUST be frugal at the beginning of your investing career  Millionaire tips from Grant Cardone and what to do when your property ISN’T profiting  The two-minute deal analysis Ryan uses at Cardone Capital EVERY day  And So Much More! Links from the Show Find an Agent Find a Lender BiggerPockets Youtube Channel BiggerPockets Forums BiggerPockets Pro Membership BiggerPockets Bookstore BiggerPockets Bootcamps BiggerPockets Podcast BiggerPockets Merch Listen to All Your Favorite BiggerPockets Podcasts in One Place Learn About Real Estate, The Housing Market, and Money Management with The BiggerPockets Podcasts Get More Deals Done with The BiggerPockets Investing Tools Find a BiggerPockets Real Estate Meetup in Your Area Davids's BiggerPockets Profile David's Instagram Rob's BiggerPockets Profile Rob's Instagram Rob's TikTok Rob's Twitter Rob's YouTube Need a Real Estate Lingo Review? Check Out the BiggerPockets Glossary BiggerPockets Podcast 108 with Grant Cardone BiggerPockets Podcast 250 with Grant Cardone Book Mentioned in the Show Rich Dad Poor Dad by Robert Kiyosaki Connect with Ryan: Ryan's Instagram Ryan's YouTube Click here to listen to the full episode: https://www.biggerpockets.com/blog/real-estate-821 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email [e-mail]. Learn more about your ad choices. Visit megaphone.fm/adchoices

This is the Bigger Pockets podcast show 821. Day one, when I joined Grant's team, he used to underwrite a deal. I used to tell him two minutes. It's actually like 43 seconds. But I'm like, man, if I could underwrite a deal like Grant, then my whole life would change. What I do is I just take the number of units times the rents in place, not like what the broker's telling me, in place rents. And then I just use the occupancy of like 94 or 95 percent, depending on the marketplace. And I just use rough numbers.

Like, okay, my expenses typically in between 40 and 45 percent. And so I just, okay, this is what my NOI is going to be based on here's the income minus the expenses. Here's my NOI. And so I can solve for like on these bigger deals, they all traded a cap rate. And so I literally can underwrite a multifamily deal 300 units within two minutes. What's up everyone? This is David Green, your host of the Bigger Pockets Real Estate podcast. The biggest, the best and the baddest real estate podcast in the world.

Every week we are bringing you stories, how-toes and answers that you need to make smart real estate decisions now in this current and ever-changing market. I'm joined today by my co-host Roberto Abasolo, who does a great job today, by the way, Rob. Oh, thank you. I appreciate that. This is a fun one. You know, you and I walked out of this with brand new shiny nicknames. You are the skyscraper of real estate, and I am the fire hydrant of real estate.

And so, you know, I think people are really going to have to stick around to the very end to find out how we got these self-dub nicknames. That is a great point. Make sure you check those out. This will be something funny. and when you see Rob in person, you're going to want to call him the fire. Today's guest is Ryan Seco, an airline pilot-turned real estate investor who started buying some single-family property, turned that into multifamily, now runs a fund and is crushing it.

And he gives some great advice for how to do everything I just said, as well as the right way to approach somebody to get into the right situation. I thought this was fantastic. Rob, what did you think about that? It was really good. It was really good because he put himself out there in a way that showed value to someone else and solved a problem for them. And I think this is probably, I mean, there are so many lessons to take away from today's podcast, but the way that he approached it and his willingness to just get in the mud, get a little dirty, figure things out,

and really jump in the ring, really set him apart to really have one of the most amazing career transformations I think I've ever heard of on this podcast. So I'm excited for people to hear his career unfold as we get. get into it for the next hour. Yes, sir. This is a great episode. You're going to listen all the way through and take some notes. Before we bring in Ryan, today's quick tip is simple. Show up with solutions and not just problems. Any human being can show up and say, hey, boss, there's a problem over here. That doesn't help. It's better to come and say, hey, here's a problem and here's what I've already done to try to fix it. What are you thinking? What could I do better? Be the person bringing the solutions in your world, not the problems. And by the way, and I have another quick tip.

Number two, quick tip, light. All right. If you ever get intimidated by R.E. Terms, R.E means real estate, by the way, real estate terms, you don't know. No. I cap rate, L-O-I. Go to biggerpockets.com slash glossary. If you've ever heard us toss around abbreviations or things that really, you know, like terms, a lot of the times that can be found on the glossary and it can explain it for you. We do our best to always stop and rewind and explain anything that might be a little too, you know, might be a little bit too, you know, Might be a little bit too much of an acronym. You know, we get a little carried away with the like eight letter acronyms every so often. So, yeah, go to BiggerPockets.com slash glossary if you want to brush up.

Yeah, I'm excited when he talks about the GQ LMIP. I think that's one of the most standard real estate principles out there. There are two kinds of real estate investors, those who have reviewed their insurance and those who think that they have. Most don't realize their coverage wasn't built for how they actually invest. Vacancy periods, rehabs, short-term rentals, or LLC held properties. These gaps surface only when filing claims. That's why investors work with NREG.

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You've upgraded how to buy properties, but did your insurance get the memo? When investors start scaling, insurance can't be an afterthought. Most policies were designed for a single property, not multiple rentals, LLC ownership, short-term stays, or properties mid-rehab. That's where blind spots can creep in. NREG works exclusively with real estate investors. They understand portfolios, how risk compounds as you grow, and why insurance should protect your upside, not just a checkbox.

One uncovered claim can undo years of progress. Before your next acquisition, review your insurance. Talk to NREG and get investor-specific coverage from specialists who actually understand real estate at NREG.com slash BPPod. That's N-R-E-I-G.com slash B-Pod. Let's bring in Ryan. Ryan Siko, welcome to the bigger podcast. Lockets podcast. Little background for our listeners. Ryan's been investing for about 15 years. He started

in single family and small multifamily early on in the state of Arizona. Has three million invested making 10 to 12 a month fully passive now. And we will find out why that is later. Ryan has a love of flying and leverage that passion into a new career. The biggest hurdle he overcame was the do it yourself mindset. And we are excited to hear all about this. Ryan, welcome to the show. Thank you so much for having me, Dave and and Rob. Always great to be here. Thank you for that. It sounds like a lot of your foundation is built on being a pilot, which is important because I've learned the older I get how much the foundation of myself is built on looking

at the world through the prism of a basketball player. It was like my first passion I ever had. So when I form a business, I build a team, I take an approach. I always see it analogous to playing basketball. I'm guessing that you're probably going to have something similar to being a pilot. Is that the case? For sure. And look, I actually didn't even know I was going to be a pilot when I was growing up.

my uncle. It was something that he always wanted to do. I was 17 years old. He was a builder. I wanted to buy my first house. And he looked at me. He says, son, you don't have any money. And so we were flying one day. And he's like, I looked at him and I'm like, I could actually get paid to fly airplanes. And when he said, yes, I was hooked. And so it was actually kind of a roundabout way for me getting back into real estate. But 1,000 percent, I mean, aviation and flying like basketball, there's just a lot of discipline. There's a lot of training. There's a lot of checklist. And so that's helped me tremendously, uh, transfer the skill set that I've learned in my 20s into, um, you know, buying real estate and in managing real estate. So 100%. Oh yeah. I imagine that's

very much like your pre-flight checklist buying properties and knowing what needs to be done when they're bought. You have to have great vision, know and trust your instruments, rely on the information that other people gave you and trust that you're getting good info. People are your priority, you value safety of others, you trust your team to get you on and off the ground and support you on this journey. In your opinion, what makes a great pilot? So I think what makes a really good pilot is somebody who has the ability to learn, but also stay curious. When I was getting into becoming a pilot, you know, there's two different types of pilot. There's bold pilots and there's old pilots. But there's no such thing as a

bold, old pilot. And so these are the different things that we have. have in the aviation business because, you know, we could all be bold. But at a certain point in time, you have to, you have to rely on, okay, what is the safe approach, you know, for the flight? And I really think that, you know, it's a constant training event. As a pilot, it's over and over and over. And so what makes a tremendous pilot is somebody who flies a lot. Same in the real estate game. Who's the most proficient in real estate is somebody who's doing deal over a deal over a deal. And it's, I just keep it simple. Right. And you mentioned that your uncle, kind of introduce you to your love of flying as well as your love of real estate. Sounds like that's a very

influential person in your life. Can you tell me about your relationship with that person and how real estate sort of entered into the conversation? Yeah. So when I was about 10 years old, my parents split. I moved from Southern California to Scottsdale. And my uncle, he was actually a builder in Scottsdale, Arizona. When I was a young man, he brought me on the job sites because for for for for for me i was just trying to okay what what's next right so i wanted a car um and so he started teaching me about real estate he was a builder uh he always wanted to be a commercial airline pilot but one day he took off he was flying and he actually scared himself because he couldn't find the airport and so he literally gave up on his dream of becoming a commercial airline pilot

and so when i was 17 years old i didn't have any money and we were flying and i asked him i said hey look you know can i get actually get paid to to do this and he said yeah and so you know really that went that that that's when aviation was introduced into my life from a young man and I really just you know just started grinding I started flying every single day I put the real estate on hold but I always knew that I wanted to come back to it so that's really how was introduced to me uh from a young age and you know I just I had a wait because I didn't have any money so that's awesome so that's how you ended up in in aviation but what was life like in the early days of your career in aviation or in the real estate uh in aviation so

I mean, look, in aviation, when you first get started out, you're traveling a lot, you're not making a lot of money. My first year as a commercial airline pot, I think I made $48,000 a year because they had to put so much time and energy and effort into training me. And so I went and got a student loan for $140,000. My first year, I made $48,000. I was a first officer on a $40 million jet. And I was traveling all over the U.S., Canada, and Mexico. and as I built seniority, life started to become better for me, and I started getting more days off. And so you fast track that to 25 years old.

This is actually where 2008, 2009, 2010 happened. And it was really great timing for me because I started making money in the airline. There was great deals in real estate in Arizona. And so that's actually when I bought my first, what I call a crash pad, which is really cool because in aviation, it's kind of like, the house hacking, but in aviation, we call it a crash pad where you rent your rooms out to these other pilots. And so I bought my first home and I was able to rent out three of the rooms, collect net profit of 400 bucks. And so that was really my start in real estate. It was a single family home in Phoenix, Arizona. And I was making 400 bucks. I was living in the master bedroom.

And that's when I realized I needed to do something bigger. So why didn't you scale? and just buy a whole bunch of properties and make them all crash pads? Because it's management intensive. The reason I didn't do that is because you had to manage it. Like I literally, I went home one night and, you know, it's a common area. You share everything. And I didn't want to, you know, I could have scaled it with many homes and it would have been a great business, but it's really management intensive. There's a lot of people coming in and out of the homes. And it's just really, really heavy on the time. What I, what I started looking at is, okay, how do I buy these apartments? So my next deal was a fourplex because I didn't want to live with the renters.

I didn't want to live with the people. And so that's where my breakthrough happened where I was like, okay, I could do these single family, but how do I scale? So how did you have the vision or the foresight to even save and invest in your first property? Do you remember how much you had saved up to even get into this crash pad house hacking situation? Yeah. So I bought that as my primary. So I needed like three and a half percent down.

I think I put down like 10 grand. I'm very frugal when it comes to money. And so even when I was making 50, 60, 70 grand, I was able to save 10 grand a year. What had happened was on my next deal, I saved up 25 grand because I actually had a car that I had bought and flipped in order to get the 25 grand to put down on the fourplex. And so I've just, I've always been creative. I've always, I've always saved my money to invest it. But I just, I just knew that I had to keep buying deals because I wanted. of the cash flow. I wanted to buy a deal and it actually makes some passive income. Yeah, I always thought,

you know, commercial airline pilots were, you know, pretty high salary starting right at the top. But it sounds like no matter what, you sort of have this base salary and incrementally over the years, just like any job, it kind of grows. Is there like a side to that where it is super juicy, a really lucrative salary that you were sort of looking forward to? And that was kind of what was going to fuel your real estate in the future? Or did you not really have aspirations to go all in in the real estate space early on? Early on, I literally thought that I'd buy a single family home and buy another one and buy another one and then, you know, have some multifamily. I didn't really think of it as like I'd be a huge multifamily apartment owner or operator. I just, you know, I didn't have the,

I didn't have the belief. I didn't have the vision at that point in time. And I think like any of us, we just, you know, we want to start off with our first deal. And we want to kind of get feet wet. Like I literally, when I bought my first deal, I didn't even know what they were talking about when they asked me, hey, you know, you want to buy it down a point. Do you want conventional? Do you want FHA? I had no idea what any of that meant because I was never taught that in school. So, you know, for me, it was like, okay, once I found out I could do the first deal, it excited me because I was making $400. My second deal was making $600, but it was a fourplex. And I actually bought that. It was a foreclosure. And I redid everything. And the biggest mistake that I did was I

I thought I had to do it myself. So I had no idea I'd end up with 21 units at the age of 30. I just knew that once I bought my first deal and I said, if you could do one, you could do two. If you could do two, I could do four. If I could do five, I could do 10. And so I literally just started reading a bunch of books. I mean, I really like to just figure things out. I'm very curious.

And so once I had my first deal, I was like, okay, what's next? That's pretty cool. Yeah, so 21 by the age of 30 is really quite the accomplished. you said you wanted to get into this and you're like, I'm just going to buy a single family house, single family house, single family house. You know, a lot of people have different reasons for getting into real estate, but what was yours? Did you have a why or a motivation that? Because like it's very like I would say, I don't want to say rare, but it's not like a lot of people go into real estate like, oh yeah, I'm going to buy one and then on. Like usually there's some

kind of turning point or some kind of fuel that's like firing them up. What was that reason for you? So when I would go to work at the airline, what I started to realize is that when I was having these conversations about real estate with my family and with coworkers, a lot of them were saying, oh, you know, be careful. You know, real estate's risky. And my turning point for me was, you know, I was going to work every single day and I was trading my time for money. And at the time I was getting paid $100 or $120 per hour. And I was like, how long can I do this for? like like like how long can I travel uh for the airlines and so I really had that turning point because I read rich dead poor dead Robert kiosaki like how long are you going to trade your time for money and and that was awakening for me and that's really what got me on that path to real estate is like okay if I can make money here put it to work in real estate and then get the cash flow to pay off my student loans I mean you guys have to realize I was in debt 140 grand I was in debt 140 grand and people are like pay it off as soon as you can pay it off as you can and so what I did is I I bought a fourplex with the $25,000 and the extra cash flow that I was getting from the

fourplex, I would just pay down an extra $400 on my student loans every month. And literally, by the age of 30 years old, I had $140,000 paid off. I still had the principal, Rob and Dave. Like, I still had the principal working for me and my student loans were paid off. So for me, it was really just that shift at like 24 and 25 because although my uncle was very helpful in my early age, he didn't understand cash flow. He didn't understand having the assets because remember he was a builder. He would build to sell for a profit.

When I started getting my head right in my mental right, I was like, man, I want to, I want to buy it, I want to hold it, I want to cash flow it, and I want to get the benefits that real estate actually provides. Do you remember just out of curiosity because, you know, student loan payments, they aren't very friendly. What was the student loan payment like on $140,000? It was like $600 for 30 years. What?

That's nothing. But, but, but, but, but, but, but, but, but, but, but, but, but, it was, it was, it was, it was, it was back in, you know, 2002 where interest rates were lower. And, and, and, you know, you paid 600 or 700 bucks per month. And over 30 years, that's a long time, right? It's over 30 years. Got it. Okay. That makes a lot more sense.

Because I was paying like a thousand bucks, but it was amortized over 10 or, yeah, 10 years or something like that. Okay. So, 600 bucks, I mean, not super bad, but obviously like, if you could replace that with income, that was sort of like the goal. You're like, let's chop that out. And then let's start. figuring out how to use real estate to sort of fuel the overall wealth of your life, right? Well, yeah, and everybody was telling me, like, I had 25 grand. They're like, no, you should pay off your student loan. And I was like, no, no, hang on, hang on. Let me go buy a four unit. The rents were

like 500 bucks. So I was literally collecting two grand from four units. The mortgage and everything was like $1,200. And, you know, after expenses and everything, I had like $600. So I would literally take the $600,000, double it. And I would just start chipping it down. So that way, when the student loan was paid off, I still had this four units or I saw that principal working for me. Yeah. Okay. All right. That's cool. So was there any benefit to being a pilot and getting into the real estate world and as a pilot just flying around into new markets, discovering markets? Yeah. Like certainly you must have been more privy to market than the typical investor that never actually may get to visit a market before they invest there. It was a huge advantage because I was based

So I was based at Chicago O'Hare, LaGuardia, D.C. My last base was actually Denver. And so I was able to go and see these cities and I was always shopping real estate on my overnights. And then also I was getting like 13, 14, 15 days off because typically in the aviation space, you get four days on, four days off, four days on, four days off. And so it actually gave me time when I got back home to Scottsdale, I can go and look at real estate. When I bought my first deal, I'd have four or five days to actually renovate the units. And so for sure, like, I always think the biggest mistake for people is when they're so, like when you grow up somewhere, you have to go and see other cities. You have to go and see other spots because you see the growth. You see the trends. You see different things that maybe you're not seeing in your city. You see the path of progress. So I've always been a student and I've always loved real estate. So I used to take advantage of like, okay, the airline's paying for my hotel. The airline's paying for me to overnight. The airline's paying me to eat. So when I was done doing all my job and all my duties, I would go and shop and drive blocks and in shop real estate all over the U.S. That's cool. So the thing that is always going to be like, I think, I'd love, I love your insight on how you can do this because you're probably going to be a big help to a lot of the audience today, which is a lot of people get really nervous about investing long distance. And they're like, man, you know, what happens if I get called in the middle of the night and this and that? You were on an airplane. And it's not like you can just take a phone call on an airplane because they make you put it in airplane mode. but mostly because you don't have reception, right? So if you don't have reception, you can't physically answer a phone call, how can you even run a real estate business that way? Well, it's difficult.

You know, and honestly, when I bought my fourplex, I was managing it myself. I'd have my girlfriend help me. Like, when we're all getting started out, you literally have to get creative. So my girlfriend would help me, like, if I was traveling. But typically, you know, if they left the voicemail, I'd get back with them within four or five.

my typical flights were between, you know, call it two and four hours. So that wasn't a huge issue. But yeah, no, it's a big deal. Like when you buy deals in other cities and states, you want to make sure you have boots on the ground because you have to have somebody who's managing it very close. And that's actually one of my biggest fears. Like, that's why I started, when I started investing in real estate, I started investing in my backyard because I was actually terrified.

I was so scared to go to San Antonio in Austin because Texas was a really, big market back in 2012, 2013. There was a lot of that growth between Austin and San Antonio, but I was always so terrified because I didn't have any boots on the ground. I didn't know any management companies. I didn't know anybody who managed real estate. And the smaller the deal is, the harder it is to find a management company to actually manage it. Were you pretty good at that point? You know, you said that you're working with a girlfriend and she's picking up the slack for you a little bit. Were you pretty good at sort of turning off the real estate button while you were flying? Or did it take a while for you to sort? Because like for me, when I go into the movie

theaters, this is my big thing. When I go into a movie theater, I'm like, I'm not going to get to enjoy this movie because I'm definitely going to get a text message or a phone call in the middle of this movie. And of course, it always does happen. Was that ever, did that ever happen? Did you ever go through that when you were up in the air? Were you able to shut that off pretty easily? You can't shut it off. I'm the same as you. like I'm always looking at my phone. It's just always like I was actually, I used to not go on vacations because I was like, well, what if the toilet gets backed up? What if they call me? Like, what if they do this? Like, what if I'm international? They can't get a hold of me.

Like I was, I was the typical scared young investor in real estate and I wanted to do it and manage it all myself. So we haven't covered who you actually started working for as a pilot yet. How did you go from commercial to private as a pilot? So this is a crazy. story. I actually was, when I had 21 units, I was 30 years old, and I said, okay, what's next? And I knew that I always, by this time, I knew that I wanted to own and operate and control multifamily units. I just didn't have anybody where I was from that was doing, like, what Grant was doing. So at 30 years old, I said, what's next? And on YouTube and actually bigger pockets, I found Grant Cardone. And on Bigger Pockets podcast, this is crazy. He's like,

look, I've got like 3,000 units. I'm looking to grow. I'm looking to scale. If there's anybody out there who's listening who wants to come and join my team, call me. And I picked up the phone and I called him and I literally didn't even get an interview with Grant. I got an interview with his team. And they're like, well, we don't really have a job in the real estate yet. Because they knew I was a pilot. They're like, we don't even have an airplane yet. It's coming in two weeks. But we got a sales job, like a sales role job. And I said, perfect. I'll take it. And so literally two weeks later, I packed all my stuff in Scottsdale in Arizona and I moved out to Miami and I started working for Grant Cardone. And I just, I just, I knew like the way he was talking about real estate when I heard him on bigger pockets, when I heard him on YouTube, like I just knew that he wanted to grow in skills portfolio. And I was like, man, instead of me doing this by myself, how cool would that be to do it with somebody who has already has like a huge head start from where I was? And so that's what I did. Yeah, that's crazy. So how long ago was that? That was nine years ago. Okay. So he was this,

Grant Cardone, was he established at this point? I mean, because now obviously he's got a huge name, huge platform, huge portfolio. What did it look like back then? Was he super established? Because it seems like you just took a giant risk, you know, to go work for him. What did you see in kind of where he was at that moment? Yeah. So I saw the opportunity in the real estate market, but I saw Grant was, was very passionate and he understood real estate. He had about 3,000 units at the time. So we kind of operated kind of like a single family, like a family office. So, you know, he would buy the deal, invested in himself. So he would buy a deal. He would take his money. He would invest the money and he would hold it for long term. We didn't have like the Cardone capital and the crowdfunding and,

you know, the 12,000 units. We, we had none of that. It was literally like Grant Cardone was a business and a consultant and he had real estate on the side. And, And that's it. Man, that's nuts. Okay. And then you didn't even, I thought you were going to say, did you become a private pilot for him? Or did you join his sales team? So I joined his sales team.

And then two weeks later, he, so two weeks later, he bought a golf stream G200. And Elena, I met Elena day one. I was like, look, I love flying airplanes. I got 10, I had almost 10,000 hours at that time. Like, I was literally flying every single day building up my time. And so I had almost 10,000 hours. I said, I love flying. I love real estate.

love helping people. And she's like, does Grant know this? I says, no. And she's like, well, we're buying an airplane. And so Grant was like looking to hire these other pilots. And he called me in his office one day. And he's like, look, if I hire you be my pilot, will you also work with me in my companies and in my businesses on the downtime? And I said, where do I sign? And so I literally signed a three-year contract with Grant to be his pilot, but then also work with them in whatever business, whether it's the sales, whether it's the real estate, whatever it was. I just knew that he was the right guy. Cool. Wow. What a crazy story, man. I don't think, well, first of all, I think the craziest thing is that you were like, yeah, he said to call him. So I picked up the phone and I called him. I feel like a different

time. Rob, I was terrified. Like, I was on the line because it's, it's Grant Cardone, right? I was like, you know, when you call anybody, like, like, if I was calling, if I wanted to go work for David and I'm 30 years old, it's like, man, David's this and you're this, like, you're like, you're like, you don't know what you're calling, right? So I was calling Grant's office and I was like, I want to come work for grant and it was a little bit nerve-wracking because I was taking a huge risk because I was giving up my career. I was giving up the airlines. I was giving up the 401ks. I was giving up the 18 days off. I had built an awesome career for myself, but I just knew there was something bigger. I want to ask you when you made the call, because here's why I'm asking if I'm being transparent, this gets spoken

about a lot. We just spoke with Tarik El-Musson today, and he's like, you got to try, you got to reach out. And so this gets spoken about often from influencers. And what that translates into is me getting 40 DMs a day from 23-year-old guys that are like, I'll do this, I'll run your social media, I'll build a course for you, I'll automate something and make money off of you. And meanwhile, this kid has 300 followers and he's telling me he's going to grow my brand. And it's like, exhausting having people reach out and say, I want to work from you. And you're like, what can you do? And they're like, yeah, I don't know.

Just tell me what you want me to do. We get in this stalemate, right? So I'm sure if you spoke to Grant, you came in with a plan, you proposed something and you thought about it. Can you share with our audience the effort you put in, before you made the call so we don't give the impression. Simply making the call leads to life-changing things, and you end up on the Bigger Pockets podcast,

and you had this huge story. Well, look, I think that I started building my resume, and I started building my skill set. Because to your point, you have to have a skill set that adds massive value to the team. Otherwise, you just don't add massive value. Like, if I call up Grant said, hey, I want to run your social media, I want to do this. Like, I don't have any experience doing it.

What I did is I said, hey, look, I wanted to be super. super easy, by the way. But I said, look, I've got a career in aviation. Like, if you're going to buy an airplane, I will run the entire flight department for you. And I'll do it for, I'll do it for free. Like, people don't, the one thing that people don't realize, like, I would have done this for free because when you get really close to somebody like Grant, like David, like Rob, like me now, it's so valuable because you just learn a whole new skill set. And so my pitch was three things. I know how to fly airplanes. And Grant actually kind of made a crack. at me one day. He's like, do you really know how to fly? I'm like, look, in four weeks, I can get

type rate on your airplane and I'll be the lead captain and I will be there every single day. I haven't called in sick in 10 years at my current airline. And I also have 21 units in real estate that I know they're kind of junk, but I want to grow in scale, but give me the shot at the flying first and then I'll work into the real estate piece. And so really, I think that that was the big value ad piece because number one, I was willing to come and make phone calls. I was terrible at it, by the way. I was like, I was making sales calls, but I was willing to do it. And that showed Grant really like, I'm willing to do anything. Like, honestly, guys, I'll sweep the floors. I'll make the phone calls. I could be at the top. I could be at the middle. I could be at the bottom. I'm willing to do what

other people are not willing to do. And he saw that from day one. And also it helped that I met Elena on like day two. And she, because Elena has been a huge part of my success, meaning that, you know, when I got in here, She's like, hey, Ryan likes real estate. Hey, Ryan can fly airplanes. Hey, Ryan liked it. Because that's really what led into me transitioning from being the pilot into real estate. Few things that we should highlight from that. One, you didn't come with vagueness or ambiguity.

You said, I can help you in this way. And here is why you can trust me. When we get someone that reaches out and they're like, just tell me something that doesn't work. You showed clear value. Two, you said I'll do it for free. Oftentimes when people reach out, they're hoping that they get paid in some way or it's some kind of a partnership and you don't know who they are, so you're not comfortable with that.

So you took the smart road and said, let me just build trust with the person. I'll work for free. And three, you offered to work in a capacity where you said making phone calls in a system he already had established. Grant did not have to take you and say, follow me around, kid, and I'll teach you the ropes on the first day. He could plug you into a team he already had and they could evaluate your character, your skills.

They could see what you were good at. That would be the equivalent of someone saying, hey, David, I want to come be a real agent on your team, I can say yes to that because I could stick them with another agent and they can tell me how they're doing versus I have to be the way to evaluate, which means I'm probably going to say no until I know the person better. So that right there is incredibly valuable. That's great. I think you nail down like his like pain point, right? And you're like, a pain point is if you're buying a plane, someone's got to fly the plane, right? Like a thousand percent of the time when I work with someone from like that reaches out, it's because they've heard me say

something on the podcast. They've heard me say something on my YouTube channel on Instagram that's like, oh, I'm really struggling with this. Like, I cannot figure this thing out or does anyone have a recommendation? When someone's like, oh, hey, I've got the solution to that very specific problem you have, boom. Like door open immediately, right? It's 100% what you said, David. I think you framed that up pretty correctly. Find the value, solve the pain. Yeah, and Rob, I didn't negotiate too. Like when he said, here's the deal. I just said, hey, where do you want to sign? He's like, I want to do a three-year deal with you, I was like, I'll do a 10 because I just knew, like I just, I hope that if people could take one thing away, if you can get around the movers and shakers, if you can get around the

people who are actually doing guilt, that's my advice to all the young guys out there. It's like when I'm to my 21 year old self, if you could add value to a team, if you can get around a team who's already doing what you want, that is the fast track. Yeah, it's just take note there. It's not about reaching out to someone with a terrible pitch or saying, I just want to work with you. You have to be clear about what you're looking for if you want to get a clear response back from the person, but it can work out really well when they do it the way that we're describing here. There are two kinds of real estate investors, those who have reviewed their insurance and those who think that they have. Most don't realize their coverage wasn't

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Don't overpay the IRS. Head to Costsegregation.com before April 15th. Now, we understand there was a pivotal moment when you went from flying high to being grounded. Can you share what happened in Alabama? Yeah, so as I was really, you know, Elena was a huge part of my career in bringing me into what I call the circle. I literally, in Christmas, it was eight years ago, we landed the airplane in Fairhope, Alabama, which is a super cool runway. It's like really, really small. We landed the G200 there.

It's kind of a private air strip. And I went to the hotel. And this is over Christmas. And Elena calls me, she's like, hey, look, you guys are a crew. Because the one thing about Grant Elena is that they actually, the people who work with them and work for them, they're, they're really like an extended family. And so, you know, she's like, hey, do you want to come over for, you know, Christmas dinner? It's at her parents' house. And I'm like, I looked at the other pilot. And Rob and David, I sh-you-not. He said, I'm like, hey, they just, just invited us to come over for dinner. And the other pilot's like, no, I'll pass.

You know, I'm going to go down the street and, you know, eat at this pub or whatever. And I'm like, really? Like, you don't want to go and have dinner with the boss. And so I went over to the house. And I noticed when I got there, Grant was a little bit aggravated. And I started asking him questions. I was like, well, what's going on? And he's like, well, I have a property that's 10 minutes north of here.

And when I went there, the pool was dirty. The blinds were down. It was closed. There was nobody there. And he's like, I pulled up a report. And I had four. I have 40 units that are not leased. And I was like, wow.

I was like, that is like, I'm like, that's, that's, that's, that's, that's, that's, that's, that's, that's, that's, that's, that's, that's, that's, that's, how can I help you? And he's like, well, what do you mean? I'm like, well, how, how do I help you? Like, like, what, I want to lease those units. And he's like, you would do that? And I was like, yeah. I was like, heck yeah, tell me more about it.

And so he started going on and telling me out the property and everything else. And I looked at him, I said, well, what if I part the airplane in Miami when we landed in three days? And I came back up here and I rented those 40 units for you. Would that be of service? Would that help you? And he's like, wow. He's like, you would do that. And I said, absolutely.

I'm going to get a plane ticket right now. And I'm going to come up here. And I have, guys, you got to keep in mind. Like, I've never ran a 344 unit complex before. I have 21 units. And I took a huge risk. And I was like, you know what? I'm willing to do it because I knew I could lease.

I knew I could call. I knew like if I just got in this building, I can lease 40. units in 40 days. So I told them, all these 40 units and 40 days, will you give me a shot? And he's like, come up here. Let's do it. And so that, yes, that's the transition. That was my transition where Grant actually gave me a shot working in the, in the real estate. And I was up there the next week. Okay. So a couple of things. You've kind of mentioned you were working with Elena was pivotal in this kind of relationship with you and Grant. Who is that for reference? So Elena Cardone is Grant's wife. Got it. Okay. Cool, cool, cool. And so you're

flying for them. I guess you're doing phone sales a little bit at the beginning of it. And then he's like, I got at least all these units. And you're like, I'm going to do it. He's like, wow, you would do this for me. You're like, great. And you go and you do it. How did you actually lease 40 units in how long? So the task and the goal was 40 units and 40 days over, over New Year's and over Christmas holiday. Okay. All right. So how the heck did you do that? So here's the cool thing. So I went up there the next week and he's like, look, I want you to get an air mattress. And I want you to live on site. The high life right there.

Yeah. And I want you to stay in a one bedroom apartment. And I'm like, okay, I was just willing to do whatever it took. And so I flew up there, got an air mattress, got a one bedroom, put the air mattress up. And I was literally like the first day that I walked into the leasing office, I realized really quick that there was nobody leasing. There was no leadership. The manager was posting on Facebook. There was like three likes.

I'm like, well, clearly that's not a lead gen. And so I called Grant. I said, what would Grant do? And he says, this is what I would do, Ryan. He's like, I'd go back in the last 90 days, pull out the list and print it off, though all the people who came in and didn't rent. And I'm like, perfect, done. He's like, I'd paint a picture and I'd get them back in there and I'd lease them a unit.

He's like, I'd just start with that. And so without doing anything else, I pulled the list. I started calling people, Cole calling them, right? Hey, you know, you came to this apartment complex, you know, 30 days ago, 45 days ago. Have you found a place yet? Nope, I haven't. Perfect. I found the perfect unit for you.

We actually have a discount where you have a special right now. Come back in tomorrow. I've already picked out your unit. And so I started getting all these people coming in. I literally started getting all these people coming in. I said, what else would you do, Grant? He's like, well, I'd go put your phone number on the front side of the building. On the street, I'd go and put your cell number.

I'm like, perfect. I'll go get a sign made. And so I went and got a sign made, got some new balloons, got new flowers, started cold calling people like on the 90-day list. And I started going knocking on doors of all the businesses in the five mile radius. And within 15 days, I had 15 leases each lease every single day. And by the 15 day, he called me back. He says, Ryan, get your ass back here. You are now a part of the real estate team. Man, dude, rock and roll. I honestly am really impressed because I feel like I would be already

pessimistic about that advice of like call everyone who has come in in the last 45 days and see if they are interested. Because I would have assumed everyone found a place. Right. And that wasn't the case. That's what we call follow up. As a side note, that is the number one biggest area where people need improvement in almost every business. I call it lead bleed in the real estate books I wrote, the top producer series. So much of the time, it's lead bleeds what's hurting you. You write an offer on a house. They say no.

You forget to go back and check a couple weeks later. You just assume someone else bought it. The thing's still sitting there. The sellers are singing a different tune, right? Maybe someone else tried to put it in escrow and they accepted. And then it fell out of escrow when they're heartbroken. And if you show up at that exact time, they'll take an offer for 75 grand less. But you're looking for the next deal that you can just write the offer on and try to get.

We frequently give advice. You got to write a lot of offers. But we never remind people, go back and write offers on houses that you were already rejected for. It's that same principle. And yeah, he's smart. He knows that. That's crazy. That's good.

So you're, all right. So you get the 15 done 15 days. What about the other 25 units? Was Grant no longer worried about that? because you sort of figured out those systems for the rest of the team or what? Yeah. So what happened was I identified who the real leadership was coming from in the community, which was the assistant manager.

And so what happened was we promoted the assistant to the management role. And then also on the maintenance standpoint, because that's also a big thing in multifamily and apartments, right, is you have to turn the units and make them ready because everybody, when you show an apartment, just like when you show a house, David, you know this better than anybody. You want to show the end result.

You want to show the finished product. So I think, you know, 20 days, I was there for about 15 to 20 days and that was plenty of time to identify who the players were. Give them enough momentum and energy. Because look, when a guy like myself or you or David go into somewhere, like that's great energy and you could really start building that momentum. So we got that place least. It was like 95% within 30 days. And then the proper team members were in there. So now I could start going and focusing on because at the time I did get 3,000 units.

to 300, so he had about 10 deals. I was able to go and start working on other deals because that's really where I started cutting my teeth in this business is I wanted to make sure that Grant's portfolio was running 10X. And so he started putting me on all these other deals saying, hey, you get in touch with this management company, you get in touch with this property manager, you go and just make sure that you're going through all these deals. And so, yeah, at least 15 units. I came back here. There was a team of two. It was called Grant Cardone and Ryan, and, you know, that's, that's, that's what we built off of. It's crazy. I mean, what you just showed is not, not only were you willing to, you know, roll up your sleeves, get your, your hands dirty,

but you actually succeeded. That's the thing is anyone might be willing to go out there and try it, but you actually did it. Were you already a natural leader? Was this something that you were good at? Are you particularly a charismatic salesperson? Or was it sort of like a fake it till you make it type of thing. I think I've always had the ability to learn. I think, you know, back what David asked me earlier is, you know, how did the leadership and the pilot skills transfer into what you're doing now? You know, I was a captain for nine years of a 70 passenger jet, $40 million airplane. Leadership is highly trained in the airlines. And I think that, you know, from a piloting standpoint is I'm very systematic. I am very logical. And I just, I'm a people

person. I think people are the most important part of the business. I know a lot of people are like, oh, it's this and it's this, it's the people. If a deal is doing bad, it's the people. If a deal is doing good, it's the people. Because you could have a great deal and crappy people, the deal is not going to do great. You could have a okay deal and have great people. The deal is actually going to do really well. So I think, I think that the people are super important. And I think that for me, I've had a lot of great mentors where I'm just willing to do stuff that people aren't. And I also had a great mentor, Grant. You know, Grant, Grant had the ability, like, I was calling them every day. This is what built my relationship with Grant, is I was calling them. What would you do?

What would you do? What would you do? And also to one of the David's points, too, like, Grant was not in the mood. Like, Grant's not going to teach me anything. Grant's going to put me in the positions to learn. Like, that's what people are making the mistakes. Like, they're calling people saying, that's just adjusting the expectations on that, Ryan. Grant can't teach you anything. Even if he could, it'd be like drinking from a fire hose. You don't have the capacity to sponge up what Grant would be able to teach you. I give you an analogy. Like, when you're learning from a black belt and you're first learning the martial art, they probably don't remember what you need to learn because they were five years old when they learned that. It doesn't make sense. They were not a grown person trying to understand these concepts. They were a kid whose brain soaked it up quickly, right? But we all think I want to be

trained by the best person ever. That's not the right coach for you. You want a person a step, maybe two steps ahead. Grant has an ecosystem that he can put you in with people that are somewhat vetted, that have a standard that he upholds, that have a system that he had a hand in creating that puts you in a position to succeed, right? So that Black Belt built a school. He picked out instructors. Those people can teach you the martial you're trying to learn so much better. I love your saying that because there's this idea where our ego says, I want to learn from Grant Cardone. I want the best. And now you're useless to him because you can't keep up with the level of stuff. he does. However, if you get plugged into his world, you learn something there, you prove yourself

valuable, you become one of those captains at some point that he's put in place. You're training the new people. Now, as you gain the experience of living there, you do get to a level that you can start to rub elbows with Grant and what he needs is helpful. Would you like to add anything into just that story of how you're kind of, you climb the ranks? Well, just to hit on that point too, like, like, Grant was never the type where he was like, sit down and let me teach you, you. know how to do a deal or how to do multifamily. I'll just add this. You know, when I, when I got heavy in the properties, I got on these calls and I was learning from all the property managers and the regional managers and in the really, really smart people in the real estate. When it comes to lending,

Grant put me around a bunch of bankers and a bunch of brokers. And so I had to learn the lingo. So everything, David, that you were mentioning, like, in real estate, there's different buckets, right? You got to find a deal and you have to get with the broker. who are selling the deals. Grant put me into the wolf, to the cage, and I learned the lingo, and I learned the relationships. Because you're so right, like, you can't build these relationships by yourself. You have to get around people who already have the relationships. And then you actually, by association, you become very powerful because you now have the relationships because you get spool up quicker. Same thing with debt. Same thing with property management company. Same thing with

all of this stuff in real estate. So I just think that, you know, for me, I understood that I wasn't going to go back to Grant and say, hey, Grant, what can you teach me? me, I would always go back to Grant David and say, what's next? What do you want me to help you? Can I take off your plate? What's next? And he loved that. I'm always a guy who likes and wants more responsibility. I just kept going back because my bandwidth is there. Like I have bandwidth, right? Like I'm like, we're at 12,000 units. We have office. We have multifamily. I'm like, what's next? I think a lot of us get bogged down and like, oh, well, this is a problem. But this is a problem. leaders have solutions,

leaders, non-leaders have problems. And for me, I always wanted to come back to grant with the solution. Well, you know, we've kind of highlighted

a lot of the, a lot of the skills that you said transferred over, but one thing that we haven't really mentioned is that you are now the EVP of Cardone Capital nowadays. And so we've heard from your early days and what it was like,

but what is your role nowadays in the business? Because obviously, things have really exploded since your time at the beginning of this? Well, now I run Cardo Capital with Grant. You know, so, so, so I run Cardone Capital and in, in Grant is a phenomenal partner in, you know, what has happened. I mean, a lot changes in nine years. You know, I think, I think if people look back at, you know, what we've done and this goes back to crowdfunding as well, right? Because now Cardone Capital, we're a crowdfunding platform where, you know, we're going to find deals. We have our own platform. So we don't use a lot of

these third parties. And we've been really successful just going straight to investors who are looking to invest in multifamily real estate. And we've really built out a done for you platform where we got great, beautiful, awesome deals. And we offer them to retail investors. We've raised one point, almost $2 billion in capital. In our portfolio is $4.3 billion. And look, a lot of our deals are great assets, great locations. And so, you know, my, my, my, my, my day to day has changed a lot as we continue to grow the portfolio. But I'm always still very curious. And I'm always still learning. And, you know, now that now, now, now the team's different. The deals are different. You know, they're bigger deals. But it's really the same thing. And I always go back to this.

The people that we have on our team are phenomenal. The, the, the, the thing that I'll tell people if you're just getting started in real estate, you don't have to have a big team. You have to have a really, really good third parties, meaning third party attorneys, third party property managers, third party bankers. Like, you just have to have good people around you. Yeah, so it sounds like you're buying a lot of multifamily. Can you tell us? I mean, obviously, your experience as a pilot, how does the pilot's checklist apply to buying large multifamily as you sort of go down this route? Well, the due diligence checklist on multifamily is a lot bigger than my checklist as a pilot. Yeah, I believe that. And the checklist goes for the debt,

It goes for the deal. It goes for the investors. But it's all transferable. And this is what I always say, too, like, it doesn't matter if you're in a corporate job or if you're a pilot. Because really being a pilot is really like a corporate job. Like everybody who has a skill set of either being a leader or managing a team, you can become a great real estate professional by transferring those skills. So, yeah, look, I look at a lot of deals. And I look at a lot of markets.

And so again, all of this stuff that I was telling you about earlier is like I've been to a lot of markets. I've looked at a lot of deals. I've looked at a lot of deals with Grant. I've learned from the best. I was literally with Grant. And this is what maybe people didn't pick up on this. I've literally been with Grant for nine years. But for the first six years, David and Rob, I was with him every day.

Like I was with them every day because I was flying. When we were not flying, we were looking at deals. We were not looking at deals. We were flying. When we weren't flying, we were looking at deals. Everywhere we would land, we'd look at deals. And when we were overniting somewhere, typically I would stay with him. By as most as you're observing the framework that Grant sees the world through the problems he's anticipating before they come.

And there's a lot you're learning in your subconscious. I didn't think that was a problem. Or he sees opportunity where someone else wouldn't. Or he sees an order to take this deal down. It's different than the last one. And that here's where the challenge is going to be not there, which now gives you the empowered ability to go out there, say, let me fix that, which makes you even more crucial to him. And that's the secret. If you want someone to become a partner with you, whether it's romantic, whether it's

business, whether it's friendship, whether it's anything, make yourself such a crucial part of their life that they can't live without you. I mean, that's really how you take leverage in a relationship. Yep, it really is, David. And then also you layer that with the rules that are changing because before 2014 and 2015, you actually couldn't do general solicitation, which is the way you raise money. And so as we're building this foundation in the real estate, 2015 and 2016 happened. And now the SEC, they started allowing you guys, started allowing us to go and do

general solicitation. And so all of the business owners, all of his friends, all of his power base were reaching out and saying, hey, I see you guys are doing deals. I want to invest with you. Like Cardone Capital actually started because we did one deal that was $20 million. The debt was 14. The equity was six. We raised a $6 million in seven days. And Grant looked at me and said, hey, can we do this again? The next deal was $40 million. So like all of these things, like you can't just look at Grant and Ryan and Cardo Capital like, oh, these guys are overnight successes. We literally built this thing in gradients. And I highly encourage people that are listening.

You can do it too. But you brought a skill set to the opportunity. That's just where I really want to like plant my flag here. You didn't bring nothing and say, turn me into a superstar and then get frustrated when it didn't happen. You had already done some things in life and you brought those to the opportunity and the opportunity to help you flourish. And I was investing in the day. too, David. So like I was at dinner, I was at lunch one day with Grant in Chicago and I started showing him my 21 units and he looked at him. He's like, man, these are kind of, these are junk.

And I was kind of offended at first. I was like, well, what do you mean? I was like, this is the eightplex. This is the single family home. It's like, this is good to me. And he's like, Ryan, he's like, look at what I'm buying. And I'm like, well, what would you recommend? And he's like, I would sell them all. And I was like, you would sell them all. I went home the next day and I sold them all. I listened. I called Eddie the real estate agent. Like I called David. I was like sell them all. And within 30 days, because I mean, Scottsdale was a great market.

Within 30 days, I ended up with 500 grand. I paid, I couldn't 1031 because Grant had already bought the deal. Like we do, like he buys the deal and, you know, you could roll your money in. So I paid the tax of 100 grand. But I literally took 400 grand, David. This is really what, you know, you said, I'm putting my flag in. I took my 400 grand. I invested it with grant in 826 units in Nashville, Tennessee.

And I said, I am committed to doing this. Not only am I going to time, energy, and effort, here's my money. And within three and a half years, that 400 grand turned into 1.1. And Grant, you know, I tell this all the time, Grant actually made me a millionaire. And I'm the first millionaire from my family. And I'm really proud to say that. And it's been life changing working for somebody. It's been life changing working for Grant.

I'll bet you what Grant saw when he looked at that was the return on equity was very poor, where you were probably looking at the return on your initial investment. they had appreciated to the point that the cash flow was not keeping up with how much equity you had. So he saw the inefficiency of your capital. You put it into a new deal with a value at component and stronger cash flow. And so you turn that equity to something that would give you a higher return. And I didn't have to work in the day to day, too. So it's like, it's like I went from 21 units being the manager because we all start there, right?

And I actually encourage people, start, do it. Get a fourplex, get an eightplex, get 12, plus, get 12, get 32 units. Like, do it. Because the worst thing in the world is not doing anything. and then now you have no assets. All you have is liabilities. And sometimes it takes time. Sometimes like in today's market, you're not going to go out there and crush it and add six

figures to your net worth buying a fixer-upper that nobody wanted that you found on Zillow. You may have to wait a significant period of time to build that equity up to go do what you did. But still, it's better than not doing it, right? It doesn't make sense to cry about how easy the market used to be. So you're not going to invest. Well, this is what the market offers today. So how do you build a strategy around that? Yeah, because as you buy these assets, they will over time.

I truly believe, you know, if you, if, and this is my strategy is, you know, five, seven, 10 years, even longer. You buy the best real estate. You buy great real estate that you want to hold for a long time. You don't just buy the real estate that's on a discount because that, my first deal was on a discount. I made the least amount of money on it because of the location because of the market. The third deal that I bought, I actually paid the most, but I made 100 grand within 12

months because of the location. It was so good. So, so it's interesting. Like, like, as I, as I did my first deal, second deal, third deal, deal. I started learning. I started picking up on these different pieces where I was like, man, I want to go and invest in that market because the appreciation and the cash flow was better. I don't want to just go here because it's a discount. I'm working on a book like that right now. Let me and Rob be the co-author on that book, okay? I'll write the forward.

Rob did write a forward once and it was rejected. Nobody wanted it. It will be a forward forward forward, a forward forward. Right, you've mentioned that you've, you've seen a lot of deals. You've underwritten a lot of them. And I understand you now have a two-minute process to underwrite a deal. Can you tell us what that's like? Oh yeah. I mean, so look, I, you know, the, the, the, when I, day one when I joined Grant's team, he used to underwrite a deal. I used to tell him two minutes. It's actually like 43 seconds. But I'm like, man, if I could underwrite a deal like Grant, then my whole life would change. And so literally what I do, and as you get spool up, you start learning these markets, right? And in multifamily, what I do is I just

take the number of units times the rents in place, not like what the broker's telling me in place rents and then I just use the occupancy of like 94 or 95 percent depending on the marketplace. And I just use rough numbers. Like, okay, my expenses typically in Florida on the East Coast are 40, between 40 and 45 percent on the West Coast or 30. And so I just, okay, this is what my N-O-I is going to be based on here's the income, minus the expenses, here's my N-O-I. And so I can solve for, like on these bigger deals, they all traded a cap rate.

And so I literally can underwrite a multifamily deal 300 units within two minutes. And it gives me so much power because now I'm communicating to the broker that I've got, number one, speed. Number two, I know if it's a good deal or a bad deal. So I don't waste a bunch of time on bad deals. But I've learned that from Grant. And I highly encourage people, if you're listening, learn how to underwrite really quick. Identify bad deals. Move them away from you as fast as possible.

So that way you could focus on really good deals. You know, I got to give you some props, man. I've been asking every single multifamily operator that I know for something like that for years. And none of them will because if they leave their spreadsheet, they get separation anxiety. They can't handle it. We have that with single family houses. It's called the 1% rule. Basically, you throw out everything that isn't, it doesn't have to be exactly that.

It has to be close to it. And then as interest rates are low, you can get further away from a full 1%. But as they go up, you got to get closer. And then I also learned that the higher price the asset is, the less dependent it is on the 1% rule. So a 50,000 house better rent for $500 a door, but a $900,000 house doesn't have to bring in $9,000 a month, just to cash in positive. We're not saying it's a good investment. But that's because I've seen enough of them that those patterns jump out. And you're basically saying I've seen enough of these houses that I know expenses are X over here and Y over here.

And it all goes in the algorithm of your brain and you can spend out of N-O-Y that lets you say, all right, if we're trading at a six cap based on this NOI, hey, this is the ballpark we're going to be in. play ball. And if they go, no, no, no, it needs to be something. All right, we're done. We're moving on. Not running it through a three-hour process of putting it into a spreadsheet. You're so spot on, David. And also the 1% rule, I still use it in today's market. Like, I looked at a deal today. It was 140 units. They wanted, it was like 240 grand. And, you know, rents were, it was like 1,900 bucks. And so I'm always looking at that 1% rule because I always know that if I could meet the 1% rule, I'm going to buy every deal. If a unit's 100 grand, I can get a thousand bucks, I'm buying it. Put it under contract,

right in L-O-I. Let's move on. I'll figure out the expenses, all that stuff later. But I just know. And also, the bigger the deal gets, the less you have to be to the 1% rule. Same thing else. You have a little bit more slack when it gets bigger. Because you get economies at scale. Can you just define the 1% rule for anyone at home that doesn't know exactly what that is? Yeah. So if I buy a house for 100 grand, I need to get $1,000 per month in rent. Gross, not profit. Gross. Awesome.

Well, it's encouraging to hear that that applies at the unit level of the apartment complex. So for clarity's sake, we're not saying if you buy it for $100 million, it doesn't mean it has to bring in a million every single month. What we're saying is the door count here. If it's bought for $100,000 a door, if each average rent of these units is $1,000, it's worth putting through your analysis. I'm looking into deeper. That's where you're saying, write the letter of intent, get that thing under contract.

let the guys then start to the bean counters kind of identify all the exact measurements, make sure that it's a property you want. But if it doesn't, you're throwing that thing out right away. That right there is very, very useful. If you, if it is 100 million, I'm just trying to understand why the 1% rule wouldn't be like proportional. Wouldn't it still be it's a hundred million dollar building? You'd still, you would want it to bring in a million dollars gross. I feel like in multifamily there would be more, there's more, there's more expenses to take into. account than there are with single family. And there's more income sources, right? So with multifamily, you can have income coming in from laundry, from parking, from storage. Like, it's not just the rent

versus with residential real estate, your only income sources. That's true, though. That makes sense. Yeah. When we're spitballing how something feels to us, it makes sense in our head. But if you have to articulate how you got there, you almost got to pull apart the algorithm of your own brain to be like, why did I think that was a bad idea? And hopefully there's actually logic behind what you said. But a lot of like what you're doing, Ryan, when you've looked at so many deals is it will stand out like, oh, that just feels like that's probably good.

You don't know why. You couldn't explain it. But when you dive in deeper, you'd be like, oh, that's why there's inefficiency here. They could bump rents much more than what they realize or insurance is much higher than what they thought. So they're not going to get this much money. Sometimes you don't know exactly why it feels right, but you know that it does. Yeah, exactly right.

And to your point, David, like the income and the rent is one thing. But then you also have like utility reimbursements. You got other income. And those are really big numbers on multifamily. That's why it doesn't have to meet and match the 1% rule on like the door count. But what I was going with that too, David, is also like knowing the number is quick, it allows you to be the captain. It allows you to be the guy now in these bigger deals where you have confidence where you could actually start using crew resource.

which is team resource management, which is actually the broker, hey, what numbers did you come up with? Hey, what are you showing for the going and yield? Hey, what are you showing debt guide? Like, I think people overcomplicate multifamily. And really what I want to instill is saying, hey, look, know the numbers really quick. So that way you can communicate with the brokers with confidence. That way you can communicate with the debt with confidence. Because the bigger the deal you get, the more partners you have. And this is actually a safeguard in these bigger deals. because the debt's going to thoroughly look at the deal. The broker, when you're, my competition right now is these big institutions, whether it's

Blackstone or Starwood or you can go down the whole list. These guys are very, very professional and everything has to check a box. So the sooner you guys can get to these bigger deals, the less risk or the less chance of missing something actually occurs, which is crazy to think about. Man, that is kind of nuts. At what point, just out of curiosity, at what point will you be a, will you be a big institution? I mean, you guys are, you guys are growing at such a fast pace. Well, look, we slow down our buying over the last eight, ten months because of this shift.

We think that there's going to be a huge opportunity in the next 12 to 24 months, especially as, you know, debt and maturities and where interest rates are to buy assets at a great basis. What I mean by that is if you can buy a deal for 225 a unit and it costs 300 with inflation and everything else, build. We think that long term over 10 years, those are great buys. But, you know, I, you know, look, we're, we're competing with them now. It really is just a function of how do you grow and scale the correct way? We're not in a hurry, but we know we'll get there. So, you know, we're just, we're just really patient. You know, we are very conservative. I know a lot of people look at Grant and Cardo Capital, you know, Instagram is one thing, but when he goes to invested money, like Grant has a lot of money invested in these deals. Like he literally takes his money,

invest in these deals. For me personally, all my net worth is invested in these deals. So we know it will come. It's just a matter of time. And the cool thing about it is we're doing it with retail investors. We're doing it with partners. Like when I say retail investors, this is just everyday folks. This is just like me and my family and David and Rob and like there's no middleman. So it may take a little bit longer. But when we do get there, it's going to be together, which is super awesome for us. It's amazing, man. What a journey. What a journey. I'm excited to, I want to connect with with you after the podcast for sure, but we got one more segment for you, if you're willing to indulge us. We call it flight, fight, or fright, and we have three questions for you

that we want you to answer that each one of those words. Is that cool? What is it? It's fight, flight, or fright? Close. It's flight, fight, or fright. Okay, we're going to send you some, some rapid fire questions here, all right? So first one, fright. What are the fears you had to overcome to get where you are? I had to overcome the fear of failure. When I first started working with grant on that 15 units or the 40 units and 40 days, I was actually terrified because I was like, what if I fail? I won't have the opportunity, but I did it anyway. All right. Flight. When do you know to walk away from a deal, a job, or an opportunity? When the numbers don't make sense and there's no more growth. Okay. Last one.

Fight. What were the hardest lessons you had to learn in real estate? The hardest lesson I had to learn was not doing it myself. So the hardest lesson that I had to learn was like, like in my mind, my dad always taught me that I want to control 100% of everything. The hardest thing for me to undo was that partnerships are really, really good and they actually accelerate what you could achieve if you partner with the right people. Awesome. I like that. David, that's kind of like a like a mental or like a mindset. deal deep dive almost. It's like the mindset version of it. And Ryan, you gave awesome answers. It's almost like you've been training for this. And I didn't even have, I didn't even,

nobody even prep me for that. That was kind of like random. Well, thanks, Ryan. This has been an excellent show. We covered how to get started with the advice that you have. It doesn't have to be perfect. So your uncle gave you some advice for how to get you going in real estate. You built a portfolio that eventually Grant Cardone told you was crap. But it doesn't matter because that crap got you to a point where it could even be called crap and you could put it into something better. We talked about the right way to reach out to somebody and we gave kind of a framework for everybody that's trying to get an opportunity. I hate the spaghetti against the wall method. Just send a bunch of DMs and hope that something sticks. Actually come with something feasible

that you're proposing and be humble, like you said, just I'll work for free. Let me prove my way. But if you get in the right environment, that will get you to the top. You're now running Cardone Capital. Well, if that's not a great example for everyone to follow, I don't know what is. We talked about underwriting deals quickly, right? Not getting too caught up in the mess. That does not mean that you're going to buy a property based off of a 43-second underwriting system. But it does mean that you're going to get your foot in the door and that you can move with the power players. Those brokers are trying to figure out who's legit and who's kicking tires.

And you kind of put yourself as a frontrunner in that situation and then take some time to analyze the deals. and we talked about buying properties thinking about the future, not just right now. What do you expect rents to do in that area? What do you expect jobs to do in that area? Is there going to be more supply coming in or a supply somewhat constricted when we had grant on the show the first time? He actually talked about how he likes to buy in liberal areas because they are less likely to issue new building permits.

And it's a way of kind of eliminating competition. It's a different way of thinking that your typical investor that just runs it through a calculator and says, yay or nay, is it taking into consideration? Rob, anything you want to add there? No, no. You covered every single thing. And just going back to your thing about, you know, people reaching out and everything, you mentioned getting your foot in the door.

There was this old adage back in the day or this old kind of urban legend of this guy that really wanted to work at a very prestigious ad agency. And so what he did is he sent a shoe to the creative director with a note that said, I just wanted to get my foot in the door. So I just wanted to know, would that work on you, David? Do you think that would be a way to get through your DMs if everyone just sent you a shoe? No, that's the opposite of what I was just saying. People come with a plan.

Don't try to be cute. Don't, but I'm so clever. I said, David, a shoe. And I get the shoe. And I'm like, well, now what do I do with you? Like, it just, it always sounds good when you hear the story. And it just turns into a Cinderella tale. But no, that isn't, that's not.

Unless inside the shoe, you have a business plan and you tell me what your skills are and say, give me a shot. I'll do this thing for you. And then you can see how it looks. All right. Well, thank you, Ryan. This has been fantastic. I really enjoyed getting to know you and thank you for sharing things.

Where can people find out more about you? Very easy. Social media, Ryan Seco, YouTube, Instagram, cardoncapital.com. I mean, I'm very out there. I'm very open. I typically get people, my cell number, but I'll leave it for the social media and also the website. And Seco is spelled T-S-E-K-O. So that's R-Y-A-N-T-S-E-K-O.

Go give Ryan a follow. Rob, how about you? Where can people follow you? Oh, you can find me over on Instagram or threads or YouTube at Rob Built, R-O-B-U-I-L-T. I teach people how to do real estate, Airbnb, short-term rentals, investing, life liberally, the pursuit of happiness, and everything in between. What about you, David?

Find me at David Green 24 all over social media, including threads and Instagram and everything else, or at David Green 24 on YouTube. My website's Davidgreen24.com, so thank you for saying that. My social media used to be pretty boring, I will admit, but it's been stepped up quite a bit. It's fire now, my friend. You have done it. Absolute fire. If my social media had to glow up, it would be Ryan going from a pilot to Grant Cardone's pilot and now running Cardone Capital. So just like you don't want to miss out Ryan's story, you don't want to miss out on my social media. How is that, Ryan? So basically, David's social media is the Ryan Seco of social media.

That's what I'm saying. Yes. Thank you for clarifying that. This is David Green for Rob the fire hydrant. solo. Signing out. Thank you all for listening to the Bigger Pockets Real Estate podcast. Make sure you get all our new episodes by subscribing on YouTube, Apple, Spotify, or any other podcast platform. Our new episodes come out Monday, Wednesday, and Friday. I'm the host and executive producer of the show, Dave Meyer. The show is produced by Ian K, copywriting is by Calicoe content, and editing is by Exodus Media. If you'd like to learn more about real estate investing or to sign up for our free newsletter, please visit www.com.com

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