The Code To Winning - AIRBNB ARBITRAGE: GET YOUR FIRST AIRBNB WITHOUT OWNING || STEVEN MCCOMBS || EPISODE 013

Episode Date: January 21, 2025

AIRBNB ARBITRAGE: Get your first Airbnb without owning #013   In this first episode of The Code To Winning in 2025, we sit down with Steven, a self-made millionaire and inspiring entrepreneur whose journey embodies the American Dream. 🌟 Born in Mexico, Steven’s story is one of grit, determination, and unwavering focus. From saving money as a restaurant manager in his home country to making the leap to the U.S., Steven started in door-to-door sales, where he honed invaluable skills that laid the foundation for his success. 🚪💼 Now thriving in the insurance industry with his own agency, Steven helps thousands of Americans secure the right coverage every day. But his ambitions don’t stop there—he’s also mastering the game of Airbnb arbitrage, turning the concept of property ownership on its head. 🏠✨ 🎙️ In this episode, Steven shares: ✅ His journey from immigrant to millionaire ✅ The door-to-door sales lessons that changed his life ✅ How he built a thriving insurance agency ✅ A step-by-step guide to Airbnb arbitrage so you can start today Whether you’re chasing your first big win or looking for your next big move, Steven’s story is a must-listen. It’s packed with actionable insights and proof that with the right mindset, anything is possible. 🚀 🎧 Tune in, take notes, and as always—STAY WINNING!

I came up to the United States about nine years ago with $1,000 in my bank account. That was about two or three years' worth of money I had saved in Mexico as a restaurant manager when I was 17 years old. Basically, I had been in the insurance world for about, I would say, six to seven years at that point. And I kind of realized I was like, okay, insurance, I'm going to kind of grow slowly. And I need to find a way or where to put the money that I'm making in insurance to be able to, start a new business or something or maybe buy real estate or something right so you could do air bmb without owning a property seemed unobtainable and owning a property also seems unobtainable here in utah the houses are six hundred seven hundred thousand dollars that's a lot of money to get your first properties obviously

we made a lot of money our first month and i was kind of surprised honestly and that i could say that was kind of the end of the golden era of air bmb the reason i say that is you could throw anything to the wall and it would stick. Now it's not like that. Now you need to be very careful with anything that you do and you put up because it has to fit the mold to get results. So basically, Airbnb arbitrage is you rent a property from someone or an apartment or whatnot and get permission by the ownership to put the property on Airbnb. A lot of people say, well, why would they give you permission or why wouldn't they do it themselves? Well, if you haven't noticed, having a hotel is very hard. Having the cleaning staff, dealing with people coming in and out of the property is very hard. It's a business.

And so a lot of homeowners don't want a business. That's why they bought a home because they just wanted to buy it, put a renter, and not deal with it. Getting one is obviously not the best idea because you're only going to make a very small amount. And you want to focus on making the most amount of money as possible, as quick as possible. How do you end up finding the right areas and how do you end negotiating with the landlord. Finding the right area is getting easier now because there's tools like... The Code 2 winning insights you need today to seize the world tomorrow. Today we're in a brand new, amazing studio right here in Utah.

We have an amazing guest, a special guest. He goes by the name of Stephen McCombs, a brief and short introduction of him. I often love those very fascinating and inspiring stories of immigrants that have come to America to pursue the American dream. And we have an entrepreneur today, year, who completely defines what the American dream is and what it stands for at the same time as well. A man who's been very successful in the Airbnb, in the insurance space, you name it, all right. So without further introduction, our entrepreneur and special guest today on the co-winning, ladies and gentlemen, Stephen McCormick. homes. Nice to meet you.

Sorry about that. Awesome stuff, man. One of the things I want to really be grateful for you is the short time frame I gave you or when we discussed for you to actually join us in the studio. So I really want to thank you for your time, especially coming about like 20 minutes early as well. So thank you so much for your time, boss. Yeah, thank you so much for inviting me.

Awesome stuff. Now I want to touch base. If you notice in the introduction, I spoke about. the importance of like the immigrants that come in and pursue the American dream. And often yours is very, very fascinating. Hence why that's the reason why we reached out as well. I want to know personally for myself and also the viewers, who is Stephen McCombs? Your upbringing and just about yourself. Yeah, for sure. So my name is Stephen McCombs. I came up to the United States about nine years ago with $1,000 in my bank account.

that was about two or three years worth of money I had saved in Mexico as a restaurant manager when I was 17 years old. So as a young age, I've always been a hard worker. I've been taught by my grandparents and my parents to be hardworking, right? And so it's my upbringing was very interesting. I was very into money and working and knowledge. And as a young kid, I used to read books like the richest man in Babylon. And I was probably 10 or 9 years old when I read that book. And I was always learning about interest and all these different things about work. And so when I turned, I think I was like 20 or 21, I decided to come to the States.

And luckily, I call myself, I could be an immigrant because I am coming from. a different country, but I am half white. And so I do like to be clear with that with people, as I am half white. I did have citizenship in Mexico and the United States. So that part was very easy for me to come to the United States, but obviously I didn't have anything over here to come to. Exactly. Yeah. Awesome stuff. And so when you first moved, Jay, did you move by yourself, or did you move with a family member? Did you just reside in California? How, what was the situation like? So interesting story is I was in Mexico and I just kind of realized that I didn't have a future there. I lived in a very small community.

It's like an Americanized community in Mexico. Okay. It's very small. It's called Chapala. Oh, right. And I just realized that the only thing I would have out there would be like a restaurant manager or some random odd job there that I could find. and I didn't really have a lot of potential to growth. And so with $1,000 in my bank, I withdrew that money, had it in cash, changed it to dollars,

and I flew to California. And no family members there. I reached out to a friend that was selling pest control, and that was my first job in America, was selling pest control. I love that. You know, I'm grateful you mentioned that. I think we have similar stories. And I want to touch on when you said you had $1,000 in your bank account.

One thing that also people don't realize is how strong the dollar is. So the amount you have to actually save up in your prospective countries or respective countries rather is the fact that it has to be such a substantial amount of money. For instance, South Africa was like at 1.20 rand to $1.00. And so going back home with a thousand bucks, you can live for like a decent, a decent few months without like less few expenses, but like food and most stuff are rather cheaper. So having $1,000 coming from. like in Mexico, you had to save up a substantial amount of money in that specific currency as well, right?

It was substantial. I mean, I was living with my mom in Mexico, and I wasn't spending a lot of money, and I was a restaurant manager, which I was making good money for Mexico. Exactly. And it took me two years to save $1,000. Wow. And where did you sell pest control? I sold pest control in northern California. I lived there. The Dublin area, Concord area. Tracy. Yes. Yeah. So that was my first job in America, which I'm very grateful for.

Which year was that? That was in 2015, I think. Okay. Yeah, I hadn't just arrived here just right there and then. But I'm very familiar with the area. I lived in Tracy for like three years as well. So like the Dublin side. Yes.

We used to go golfing around there because they have an amazing. It's beautiful. Exactly. It's so beautiful. Yeah. That's when I realized I was like, that's why I came to Utah because I was like, I can't afford to live here. long term. It was very expensive. I remember. I used to pay like $500 for like a bed in a room or something. It was, it was very expensive. Our rent there was about $2,500 for a one bedroom a month. And so if you look at like the most expensive places to live, not just in America, but in the world, San Francisco, because it's part of the Bay Area. Yeah, yeah. It's relatively the highest. Like in America, I think it's second to New York. If not, it's a past New York. It's just crazy expensive down there. Yep. Yeah, it was insane. That's why I came to Utah at that time.

And since then you've blew, when did you come to Utah? It was, I was in California for about six months. And then, uh, usually in pest control, there's like a season, right? And so in the summer months, I think it was like, or end of summer around August is when I came to Utah, um, for the first time. And I've, I've been here for almost nine years now. Awesome stuff. No, I'm grateful that you. you took the time from your busy schedule to join us today. And I love the entrepreneur journey as much as possible. Obviously, we're going to touch on a few things.

But one of the things I want to first touch on and speak a bit about is this Airbnb. You know, it's becoming ever so popular. It's been trending. I'm not familiar with it. And I know you're an expert. You understand the market in depth as well. I wanted to know what inspired you to take the first step for your first Airbnb. me. So I kind of have to talk about my journey that got me to that point.

100%. But basically, I had been in the insurance world for about, I would say, six to seven years at that point. And I kind of realized I was like, okay, insurance, I'm going to kind of grow slowly and I need to find a way or where to put the money that I'm making in insurance to be able to start a new business or something or maybe buy real estate or something, right? So I've always been looking for ways maybe putting in the stock market or something, you know? And so I came up with this, well, I didn't come up with it, but I saw it on YouTube about Airbnb arbitrage, right? And so I started looking into it. And the more I looked into it, the more fake it seemed, I didn't think it was real. I thought that was like you could do Airbnb

without owning a property seemed unobtainable. And owning a property also seems unobtainable. Here in Utah, the houses are $600,000, $700,000. That's a lot of money to get your first property. So that seemed unobtainable as well. And one day I met with a guy that I knew he was also doing very well in the insurance world. And one day we just met and I was like, hey, have you heard about Airbnb arbitrage? and he's like, yeah, I've been wanting to do it for a long time.

And I'm like, why don't we just team up and do it? And the next Monday, we got together, we bought a course on it, and we learned it. And within two, three weeks, we had a property. Wow. Wow. And was your first property year in Utah? It was, yeah. And like, if you can try and walk us, just by simplifying, how did you go through your first process to get the first listing?

So that's where real on. entrepreneurship is shown. That is where the real versus the fake kind of washes out. It took us a lot of nose. That first Monday that we met with my partner, we watched the course. We finished that course within like a couple of days. And then we started looking for properties. We got about a hundred knows before we got our first yes. We drove to property. We drove to properties. We met with people. We met with managers. We met with everyone, owners, and we were perfecting the skill, right? It's kind of like you're perfecting your pitch. And even though we knew what we were doing, we didn't really know if it would work. And so we didn't know what to say or how to

say it, even though we went through the course, we just didn't know because we hadn't been in it. And so we kind of looked insecure. We didn't really know if it was going to work or not. And And once we got our first yes, and I think the first month on that property, we made $3,000 profit. Wow. Yeah. And we immediately started to look for more after that. My gosh, that's actually very fascinating.

But then how do you end up, you know, as an entrepreneur, those are very, very important skills to gain because 100 knows is very discouraging, especially if you already had the experience of sales. So you understand the door-to-door rejection and understanding the purpose. of, you know, just being resilient. How did you end up utilizing that entrepreneurial skill into, like, the short-term rentals? Like, what are the skills that you gained that perfected or helped you in that specific field? Yeah, and that's the reason why I say I'm very appreciative that that pest control job was my first job in America

because anything else was easy, right? Knocking doors all day with all day getting nose and knocking 100 to 2.2. 200 doors every day for a week and getting only one yes teaches you the grit that you have to have to get that one yes and then you perfect your pitch right and then the more you do it the better you get and the more yeses you get so now we can go knock on let's say an example five doors and we get three of them where before we knocked on 100 and we got one right so you have to learn the grit of doing it until you get the yes and then perfecting your pitch while you're doing it. Okay.

And that's what the entrepreneurship journey that I've had has taught me to do. Okay. I actually wanted to read this one out here directly. It says what was some of the early mistakes you made with your first Airbnb and what did you learn from them? Because I mean, your first one, you made $3,000. I mean, there's no mistake there in my opinion. Yeah.

But we did some mistakes. I mean, obviously we made a lot of money our first month. and I was kind of surprised, honestly, and that was the, that I could say that was kind of the end of the golden era of Airbnb. Okay. The reason I say that is you could throw anything to the wall and it would stick. Okay. Now it's not like that.

Now you need to be very careful with anything that you do and you put up because it has to fit the mold to get results. Before, again, you could throw anything and it would stick and you would make $3,000. thousand dollars and that's what we did for a couple months and then we started to notice a trend of more competition and then now you have to stand out compared to everyone else exactly and so one of the mistakes we made um at the beginning was we spent a lot of money on these air bambes that we shouldn't have on things that weren't necessary like a lot of decorations that we bought we probably spent on that one unit, we probably spent about $15,000.

Now we spend about $7,000. Okay. So learning what to buy and what not to buy was very important, so you don't overspend on things that are not necessary. Oh, that's perfect. I love that. For those that aren't very familiar with the term arbitrage or what Airbnb arbitrage is, could you try and give a definition or explain the differences between both Airbnb arbitrage and your traditional home-owning property ownership.

Yeah, for sure. So basically, Airbnb arbitrage is you rent a property from someone or an apartment or whatnot and get permission by the ownership to put the property on Airbnb. Okay. A lot of people say, well, why would they give you permission or why wouldn't they do it themselves. Well, if you haven't noticed having a hotel is very hard. Okay, having the cleaning staff, dealing with people coming in and out of the property is very hard. It's a business. And so a lot of homeowners don't want a business. That's why they bought a home because they just wanted to buy it,

put a renter, and not deal with it. And that's why sometimes even these homeowners hire a management company so they can deal with the long-term tenant. Right. So I'm, that long-term tenant, right? I'm renting the property from them for a long time. I sign, you know, obviously 12-month leases, but I prefer to sign 24, maybe two or three-year leases, so that way the homeowner doesn't have to deal with the house turning the tenant over and over and over again. They just deal with me, right? And now they don't even need a management company because I'm managing the home for them. So they get all the profits from that. rental. Awesome. No, I love that. And I'll actually tell you the real truth as well.

Another reason why I reached out. We just recently had a tragedy like in the family, but what happened is my parents were here in the US, we were for general conference, but we're in Salt Lake City for about like five weeks or so. And while we're there, we just rented a very beautiful place and I ended up staying here as well it was a luxury kind of place like those apartments as well and i was just fascinated by like what a good price it was in salt lake considering it's very close to everything in terms of like just the mall um conference center if you remember all these different places but it was situated perfectly i spoke to the landlords and there was a company that was uh renting out of uh places or like the apartments out there,

but then I figured out I was one of the people that was renting from one of their places. And so in my mind, I'm like, arbitrage. I have to get an expert. So it took me like about a few days to try and find the right person that I could reach out to you. And I was very specific exactly like

why I wanted to do an interview with you as well. Yeah. Now where this leads me, that is a bigger company. You guys started off at a very probably at a good time when you're doing the arbitrage thing. If somebody today would have to start considering how you started,

what would you say would be the first step they should do try and help build a relationship with the landlords or any other step that you feel is very important. Yeah, so the most important thing when starting right now is you have to know what you're doing. Again, you could get burned very quickly if you don't know exactly how much you're going to be making and then you also need to make sure that you can cover the rents, right?

Because your rent is, let's say an example, $2,800. and if you're only generating $2,800 from Airbnb, you're just paying the rent and that's it. You're not making money. The reason why Airbnb arbitrage is called Airbnb arbitrage is because you're arbitraging the difference between the rents and the profit. So that's the arbitrage. You're making the difference between rents and the profit.

And that's where the money is, is basically you want to make that money. And it all depends on several factors. Location is big, right? So you want to make sure that that location is close to either college, downtown, a convention center, a hospital, a military base, just things that you know that there's going to be constant flow of people all year long. So that way you don't have to deal with seasonality.

Like an example, if you have a property in feelings, Phoenix, right, you deal with seasonality where people are only going there in the wintertime, but they're leaving in the summertime, right? So that way, you're not dealing with the ups and downs of peaks and valleys of the seasons, you could say. So that way you're not losing money because the rent has to be paid no matter what. And it's not a mortgage, right, where if you pay your mortgage, you're paying on your own house. You're paying someone else's house off, no matter what. So you want to make a profit. And also knowing how much you're going to make is very important because if you're only going to make $300 and the arbitrage, right, is that worth all the headache?

Not really. So you want to make sure you're making at least our numbers is about $1,500 per property. Man, I'm glad you mentioned that. You know, this is as good as a course. I think this podcast is going to be your because you mentioned all those factors, areas that you need to be in front of as well. The reason I was asking, because it's, I wouldn't, I wanted to just go get like three properties. Like, I wanted to get maybe, I wanted to stop maybe with studios. Yeah.

Something that's like more like within budget, I know I can afford. Even if things don't go well, I can, you know, maybe like a 12 month, knowing that it's a loss I'm willing to take. But from your experience, would you say starting with one Airbnb is way better than just getting boom and jumping in? If you know what you're doing, getting one is obviously not, not the best idea. because you're only going to make a very small amount. And you want to focus on making the most amount of money as possible, as quick as possible. Because the way I started was we started with credit cards.

We started with a 0% interest rate credit card and bought all the furniture. So that way in two, three months that we made the profit, we could pay off the credit cards. So that's why we were like, let's go get five or six. But we kind of knew what we were doing because we took a course. So we had a lot of knowledge compared to a person that just jumps in and doesn't know what they're doing, right? So taking a course, finding mentorship, finding someone that can teach you what to do is very important because you're going to not make the mistakes that we did, even though we took the course. We still make some mistakes.

But finding that guy that actually will teach you the ways to do it, the correct way will save you a lot of money. but in response to that, I think that I personally don't have studios. The reason is you want to fit as many people as possible, so that way you make the most money as possible. People are looking for, I'll give an example. So in this case where you rented an apartment in downtown, a two-bedroom apartment, we try to fit eight people, okay? Or the chance to fit eight people because we come up in the search bars a lot more. if we can fit eight people. Wow, that's interesting.

So the reason why I was in this looking at the studios is because they were all fully furnished. I don't want to buy any furniture. I want to just jump, but it's correct what you're saying, because whenever we do Airbnbs, whether we go to Hawaii or whether it's Puerto Rico or something, it's always Airbnbs. But then the ones that have the most reviews, the search that just seem to pop up as well. And it's never, I've never really, it's never been a studio. It's always been like a one or two bedroom and so forth. And even when we're having like teams that you see, you know, when you're selling, when you're trying to get people coming out for blitzes, you end up getting a massive place.

It's like an eight bedroom where you can fit like a whole team and stuff like that. So that does make sense. I was looking at the fact that I don't want to spend any additional amount. Just wanted to focus entirely on the rent, you know. So if you do that, you also want to make sure that that property, if you do that, you want to make sure that that that property has amenities. The most search amenity is hot tubs and pools. So if that property does not have a hot tub and pool, I see it very hard that you're going to make any money on that property.

Okay. So that's very important. Hot tub and pool is very important. Awesome. I love that. And then now a very important part while we're still in the topic of Airbnb, how do you end up finding the right areas and how do you end up negotiating with the landlords? So finding the right area is getting easier now because there's tools like AirDNA that

lets you find these areas. It lets you look at the occupancy levels of that area. So if you look at an occupancy level of an area and it says like 70%, that's the average, right? So we try to be above average, right? So if you're looking at a salesman, right, and they're like, oh, I make an average, I make $5,000 and you know you're better than average, you're like, well, I'll probably make like $8,000, right? So this is the same idea with us, is we try to look at areas that the average, location is anywhere between 60 to 70% occupancy rate, and we know we'll be around 80 to 90% just because of the things we do and we know. Okay.

So that's kind of how you find the area. And then in regards to landlords, the biggest thing is peace of mind for landlords, right? So if you just come up to them and say, oh, I'm going to do Airbnb here, they're going to be like, hell, no, you're not, right? but if I come and say, hey, you know, let me figure out what the problem is that you're having and I'll present the solution. What's the problem? Well, the problem is I keep finding tenants that leave every year, right? And I have to keep looking for new tenants every single year and fix up the property and deal with management. And I present the solution. I say, hey, you don't have to

deal with that anymore because I'll rent the property for you for the rest of your life. If the property still makes money for us, we'll rent it forever. I'll be your last tenant, right? And so that's the solution to their problem is they no longer have to find tenants anymore and I'll manage the property for them and I'll even pay for small repairs. So that way they don't have to come in and hire a handyman, a plumber to go fix small problems. I'll fix it myself. Wow. Okay. And then do you prefer houses or do you prefer apartments or condos? I have both. Okay. Um, condos are great or apartments are great because they're easy to manage. You have five apartments at an apartment complex.

You can have one or two cleaners to clean all of them. It's easy, right? It's kind of like managing a hotel, right? Houses are a little bit different or harder to manage because obviously it's one location and then you've got another one across town and then another one all the way across town. So you've got three different locations that you have to manage and they're far away. So if anything happens at these locations, it's not like you can just run to one and fix all the problems. You have to run to different ones.

So having a place in an apartment complex or multiple in an apartment complex definitely makes management easier. But if you ask me which makes the most amount of money, houses do. Okay. All right. That definitely makes a lot of sense. And I've seen it. Like I said, whenever we're like going on a few blitzes and so forth, we'd rent even for like a month, we're not going to be there that long.

We're just trying to make sure we have that buffer there that's created to try and prevent continually having that open gap where people is availability as well. While we're on the business, I don't want to take so long. I obviously want to focus a lot on the entrepreneurial side of things. But while we hear, what are the steps then that you would take in order to become a super host? The reason I like the super host thing, whenever I look at Airbnb, I look at the cheapest super host. Two birds and one stone, you know. So what are the steps you'd have to take to become a great super host?

So I like that Airbnb does the super host status because it allows people to know that this person that is managing this property has a very strict way that they manage their home. It's not a secondary house that they don't really can. care about. It's a business that they're running. Any super host on the platform is basically running a business. And the reason why people stay at hotels is because they like the normal, that they know that the bed is going to be made, everything's going to be clean. They know, right? It's just a standard. Superhost, to be a super host, you have to have a standard. Most other Airbnbs that are not a super host don't have a standard. And that's why they get bad reviews because you could go and go to this Airbnb that is not a super host and maybe the floor is not

clean, maybe the carpet's not vacuum, maybe this issue or whatever issue happens that the person before you maybe left a good review because they had a good experience, but maybe the experience is not the same for you. When you're a super host, there is a standard, which means that it's basically the same thing as going to a hotel. It's going to be the same. Okay. Right. Yeah, that makes perfect sense. And then can you give some tips on how to maintain a high level of customer satisfaction? In other words, trying to gain as many of those five-star reviews. Yeah, so we're very, very relentless with five-star reviews. And the reason why I say this is five-star reviews is everything on Airbnb. You could get your listing taken off Airbnb if you have a 4.6-star review on the platform.

So it could be at risk if you have a 4.6% or 4.6 star on the overall star rating on your listing. And Airbnb has gotten even more strict now. So you have to be very careful with your star ratings. And the reason why I say we're relentless is I have stickers, and it's so funny, I have stickers on the fridge that say what a five-star rating means, and then what a four-star rating means and what a three-star rating means and then I say I would love a four-star rating

but that's not the same thing in real life as it is on Airbnb. A four-star rating means that you did not have a good experience with us. Okay. Because pretty much Airbnb's got a very high standard. Very high. And it's gotten crazy.

It's gotten worse. Yeah, it's gone very like if you, again, if you have a 4.6, you're at risk of your listing getting shut down. Oh, wow. So you have to be, very careful with that. Anytime there's issues, we try to solve it. But again, there's obviously situations where we can't do much about it. If a customer complains about, let's say,

I don't know, they say that there's no hot water in the house and it's 7.30 p.m. You can't really get a plumber out there to go fix that issue. Right. And so we try to solve issues as fast as we can, but there are situations where you can't really do much. And obviously, the fact that I'm going to be starting it out myself. I'm going to obviously be handling most of the stuff. Are you at the point where right now you guys delegated like a little or a manager that can like try and like manage all the properties you guys have rented out on arbitraged? Yeah, so we have 25 properties right now. We have 25 and then we have a it's an internal team. So we have the cleaners are internal and the management is internal. So we have a guy that basically his job is to go restock the property. with everything. So again, if you're managing this on your own,

you're going to be the one that has to go and restock the properties, paper towels, toilet paper, cleaning supplies, all these different things, right? So we have a guy that does that for all our properties, and then he also manages the chat, so he's answering messages from people. And we also have someone in Philippines that covers the after hours, so she's the one chatting with the customer

if there's an issue or something comes up. She's the one managing those chats after 9 p.m. Okay. So, yeah, basically we have an internal team that does all of that. Awesome. Now, I love that. I love that so much. I mean, we always talk about, I mean, how much profits we make as well.

But I'm pretty sure you've had a few losses in your 25 rental properties, haven't you? No, fortunately, we haven't had any losses. So our business generates anywhere between $1.5 to $2 million a year. And no property has had a loss? None. In a single month, do you've been there? None. That's impressive.

Yeah. Yeah, none. Wow. We haven't even hit like... Break even. Yeah, like break even. It's always been profit. And that's, again, because of the way that we run the properties and we know what appeals to people

that attracts them to the properties. There are other properties out there that are barely breaking even. I know a lot of the owners. I know people here in Salt Lake that have... 50 to 100 properties, and a lot of them are barely breaking even on them. So my partner and I focus on how can we have the least amount of properties and make the most amount of profit? Oh.

Because a lot of these guys that have 50 to 100 properties, their revenues are great, but their profits are very small. That makes perfect sense. And speaking about courses, I don't know if the one you did is the one I also was enrolled in about a year and a half ago. The course covered arbitrageing as like the owner of the arbitrage. In other words, you get the rent. Everything's under your name, other corporate lease, whatever.

And the second portion was managing it. Yes. And so I don't need to do both courses to try and figure out the responsibility for those that are managing it? Yeah, the course that I took was included all of that together. It didn't really kind of separate everything. It was all together. Yeah, yeah. When looking at properties, I definitely recommend you doing it under a corporation.

So you're a corporate leasing company. Exactly. And the reason why you want to do that is just in case, worst case scenario, you are losing money. If for some reason you can't pay rents, no one can try to get that from your personal income. Because you sign the lease under a corporation. Okay. Yeah, yeah, that's what they were saying actually in the apartment I was speaking to. It was a beautiful, beautiful.

It was a luxury apartment downtown. It didn't have the hot tub, though. It had a pool. The gym was exceptional. It had also like a top main floor that just had like all the nice amenities, tables and all the kind of stuff. And so it was fascinating to see that. And I just felt like it's a good start because it's easy.

I don't want to keep getting more expenses. But it's something that when I talk to you about like you offer a course right or something. Correct. Yeah. I'll talk to you about that as well and try and see what else to live. look at, because I know you're touching very important, valuable information for the viewers and people to hear about as well, but I also know that your course is in depth and breaks everything down to the T from step one to the last step, right? Yeah, and honestly, I don't do this for a living.

I'm not like a coach. I'm not a guru, right? I, the reason why I came on is because I like helping people. I learned this from one of my, I've had multiple mentors. One of my mentors is the Muscle Keaton, another guy, his name is Hector Padilla. He's worth about $100 million in real estate out in California. And one thing that I really liked about Hector is he really likes helping people. He's worth hundreds of millions of dollars and he reaches out constantly to try to help me and give me tips and give me life advice. And I love that, love doing that for people as well. You know, anyone asked me a question on Instagram. I'll definitely answer it on my time if I have time to answer and help someone. That's what I love to do. My time is worth money. Obviously,

I'm busy, right? And so whenever someone has a question and they want me to go in depth into helping them build their business, I do offer them like coaching or mentorship, as well as a course if they just want to do the course. Oh, I love that. I love that so much. Matter of fact, that's where I said, that's where I came across you for the first time in the Limitless Society. Yep. Do you know Tay Noble or something like that? I'm not sure. He's one of the, the coaches as well there that I bought the course or the I have the lifetime membership and the limitless and so the entrepreneurs that are inside there and it's it's just very fascinating to see it's so important coaching is so important in mentorship because somebody that has done it can actually give

you the path for you to actually do it as well did you have that for Airbnb specifically a coach yeah yeah yeah yeah the guy that I bought the course from he has I think uh I think at that time he had about 200 properties on Airbnb arbitrage okay so he had been doing it for a while. He started back in like 2017, 2018. And I think, I wouldn't say he invented Airbnb arbitrage, but he was like one of the pioneers in that world. Awesome. Awesome. Just before we transitioned out, I wanted to know then, and still while we had Airbnb, because we have to like leave that topic. Marketing is so important. And standing out, like you mentioned, I think earlier when we first started off, just standing out is also very important, especially

in a market that could potentially become more saturated as people become more exposed and learn about it as well. How do your properties and your listings, like how do you market them to stand out from other competitions? Yeah, so the most important thing about Airbnb is people are not looking at your listings name. They're not looking at your listing's description. They're not looking at any of that. If you scroll through Airbnb, what are you looking at? You're looking at the pictures, right? So if your pictures don't stand out,

no one's going to look at your listing. So your pictures have to be spectacular. They have to be the best pictures ever. So that way your listing stands out to someone when they're scrolling and they're like, oh, that stands out. Let me click on it. And then they read your description.

They don't first read your description. They see your pictures. That's true. So the only way that you, the first thing, that you want to do is take amazing pictures and decorate your house accordingly so the pictures stand out.

So that could be through vibrant colors. That could be through beautiful design. That could be through lighting. There's many factors that go into it as well as maybe putting a picture of the pool or the hot tub because people are attracted to that. And so if you know that hot tubs and pools

are the most searched items on Airbnb, why is your picture or your first picture, your hero picture, a picture of the bedroom? No, that makes perfect sense. And I'm glad you mentioned that because, I mean, I've been Airbnb and always being a guest for a while, and I think I've only probably had like one bad experience, but it was like their first time ever doing it.

It was probably in L.A. like four years ago or something I guess. But apart from then, the standard is just increased so much. And some of them have not even been super hosts. And it's like, wow, like the communication is amazing. Someone's always talking to me. And so I often feel like it's a good thing that they have such a high 4.6 star because it's trying to say like if you're not keeping up the standard, you're removed. Yep.

Yeah. And it's very strict. Again, and people do take advantage of that. Unfortunately, people have gotten very savvy with taking advantage of host. And unfortunately, hosts are not strong. enough to leave bad reviews on guests. I feel like when they have a bad experience with guests, they just leave them a five-star review.

And that's very unfortunate because then that guest takes advantage of the host and then they go and do it the same to another person. So the rating, I definitely think that hosts should say the truth about their experience with guests because that is very unfortunate when we get a reservation and they have, let's a five, five star reviews, and they're just very mean to us. And we're like, how is this even possible that this person has five star reviews and they're just taking advantage of us? They want a 50% refund because one of the towels had a little stain.

Wow. Yeah. Are people that crazy? They are, unfortunately. That's one thing that I've learned about this business is you are going to find the worst of the worst in people. Wow, that's very unfortunate because like I've received on my guest thing. I've always got five star, but I've always given five stars because I know how hard it is.

And you try, I try to be that guess that if things are not really like perfect and stuff, I'm not going to try because they're doing this with so many different customers. At least I'll be like, hey, listen, we'd have no other ward isn't running and something. But I can go get like tap water. Can somebody come and fix it if I'm here long term. But I'm not overnight. It's like, yeah, things that work, I didn't break it. To protect myself in a way, you know what I'm saying?

But that's interesting. Well, that's because you're an immigrant. You appreciate, right, the hard work. But a lot of people that grew up in a bubble, whenever the hot water doesn't work, that's the end of the world, right? And so they act up like if that's something that shouldn't happen ever in the life of, you know, of them staying there. And it's like, how does that even make sense?

Things break. Things happen. So it's like it's the response that the host gives. And obviously if like we go out there the next day, we can fix it. But sometimes unfortunately those same people, they act out and they want to, we had a guest a week ago that wanted a hundred percent refund because the hot water stopped working at 8 p.m. the night before he checked out. And he wanted a full refund of his whole week. Yep. So you deal with that all the time.

Yeah, but is there where you can like try and screenshot this like this nonsense and show the Airbnb company? Like it's just, it's so ridiculous. How people can be so entitled and just like just so rude. Yeah. So unfortunately in that case, Airbnb gave him 30% back of his whole reservation. Did it take it from you? Yep. That's so unfair.

Yeah. That is so, so unfair. Yep. So that's the things that you have to deal with in this business. Unfortunately is you're just another number. You're just another listing. And so you have to make as much profit as possible on the listing. So these 30% reservations that ask back, it doesn't happen all the time,

but it does happen at least once every two months or three months. That's the there's a guess like that. Wow. Yeah. Right. Last question on the Airbnb. Right now, if somebody wanted to just start arbitrage, right? What are the credit school that you need, number one?

And then number two, what's the main? what's the minimum that you would need in terms of money for expenses, it's just starting. Yeah, let me break it down for you. So basically, if you want to do it like I did, I did it the very cheap way. And the reason why I say this is... Now you're talking my language.

Yeah, exactly. Yeah, so I didn't go in with a bunch of cash, even though I had the money. It was, I wanted to prove the concept, right? Because again, at the beginning, I thought it was a scam. I thought it was not real. I was like, this doesn't even make sense.

And so I was like, I talked to my partner and I was like, hey, like, how much money do we want to put in? So we put in into our business account, we created a business and we put into our business account, I think $10,000 between him and I. So $5,000 and $5,000, okay? We opened up a credit card, a business credit card with Chase that had a 0% interest rate for 12 months. That business credit card, because I had good credit, so that's why having good credit is important because to get that business credit card, they're going to check your personal

credit. Okay? So having good credit first is very important if you want to do it this way. Okay, this way you're not risking your own funds to start the business. That credit card, I think they gave us $10,000 in credit line because I already have some, I probably have half a million dollars in credit line with my other businesses. So that's why Chase was like, you already have so much. Here's only $10,000.

So I was like, okay, I'll take that. So we basically use that $10,000 credit line to buy the furniture. So when you're going into an apartment or a house, you have to have one month of reserves for the deposit. Sometimes they ask you for a month deposit plus the rent and then plus the application fee and everything. So you have to think about those things. That's cash. You can't use a credit card to pay cash, right? So you have to have one month reserve for a deposit.

You have to have the first month of rent and then whatever that rent is. And then for a two-bedroom apartment, you probably need anywhere between $10,000 to $15,000 in furniture. So you're looking at about maybe $20,000 that you probably need just to have just to feel safe. Because if you don't have that, if you have one bad, month that you don't know what you're doing, you're not going to be able to pay your rents. So you definitely want to be safe about it. You don't want to go all in and not know what you're doing. The only reason I would go all in is if you knew what you were doing. Yeah. And all your properties are in Utah, right? So yeah, we have some in Utah. We have some in Arizona. We have some in Florida as well.

Okay. Awesome stuff. Yep. Now, you know what's fascinating, ladies and gentlemen, is the fact that this is actually Stevens' side hustle. It's just a side hustle portion of stuff. I want to talk now just the importance of the entrepreneurial side of things. And I feel I love your story coming in here from Mexico, pursuing the American dream. I want to know what other businesses are you currently in your entrepreneurial portfolio. Yeah.

So like he says, this started as a side hustle. It still kind of is. honestly, I probably work four hours a week in the Airbnb. I would have made a $1.5 million side hustle. Yeah, exactly. So, yeah, like I said, it is still a side hustle, but it does create enough money that it could be a full-time hustle, but we have automated everything that it doesn't require me to work all the time.

Again, I probably work in this business alone in the Airbnb world with my properties about four to five hours a week. Okay. This business again generates about 1.5 to $2 million in revenue. We're probably making about 47% net profits off of that $1.5 to $2 million. And this started as a side hustle when I met with my partner and we just got along together and we're like, let's just start an Airbnb business. Right. So what I want to say with this is I, I, the only thing I had an advantage on someone else was I had some cash, a little bit of cash, but I had a good credit score. I had good credit cards and I had a relationship with Chase that they allowed me to start

a credit card to have that type of funding. Okay. So if that's the only advantage that I had, why can't you do it? Right? Because that's not a big advantage. That's not like I knew someone that you didn't. No, that's not like my father got me into this problem. None of that happened. The only advantage I had was I knew how to credit worked. I had a good relationship with Chase. I was a hustler,

and I just went into it, right? So it doesn't require you to have a huge advantage to be successful. You just have to know how to kind of put that all together and go for it. And I think 99% of my businesses have been successful because I just go for it. And you mentioned you had also like a credit repair business, didn't you? Yes. And so many people, people have the cash, you know, because there's so many opportunities, especially like here where people can try and find side hustles, do something, just get some sort of cash.

But sometimes people don't have a good credit line because maybe they missed a car payment in 2000 and, I don't know, 19 for like three months. And this was trying to recover. How do you help those, like what advice you give those people that are trying to fix their credit score that they can get into that field. Yeah, so I did have a credit repair business back like two, three years ago. I no longer do that. I sold that business.

But one thing that I can't tell you is having a good credit is probably the most important thing to have in the United States. Right now, anything you do in the United States is based on how much credit you can get. If you really want to build wealth, you want to be. over leveraged. And that goes against Dave Ramsey and all these crazy people that say you shouldn't have debt, which I highly agree with if you are an employee and have a W-2 income, don't get credit, don't use credit, don't use a credit card, just use your income to pay your bills, and that's it. If you want to make wealth and you want to be rich, you have to use credit. You have to either

get funding from your uncle, your dad, whoever, Trump didn't make his millions through himself. He had a small loan of a million dollars from his dad. Right? So that's what I'm saying is funding is the biggest part of building wealth in the United States. Right. So if you know that, why do you have bad credit then? And if you do, do everything you can to fix that immediately. because that is going to be the reason why you're not successful.

That little thing could be the reason why you can't get funding for a business. You can't get funding for Airbnb. You can't buy your first house. You can't buy a car. That one thing. Discredit. That alone can then hurt the rest of your life. And I think that's one of the reasons why.

That's the only reason, actually, that I preferred press control over solar is because I was running people's credits. And, you know, when you're down and that, Bay Area, the more south you get towards Stockton and so forth. It was just like you get people that are interested, but credit is everything. And no credit means I don't get paid. And so credit is very, very important. It's so important. And that's why, again, I think that the first thing you should work on, before you go and jump into a business or do anything, work on your credit.

If you're an employee, your W-2, work on your credit first while you're working a W-2 job. work on your credit, try to fix that, study how your credit works, understand what affects your credit first and then hire a credit repair company to fix your credit. There are just before anyone goes and jumps into a credit repair business, there are very scammy credit repair businesses. So be careful with who you go with because they make money off of the monthly fee you're paying. So if you're just paying monthly fees and they don't fix your credit, they're just, making money. So be very careful. Work with someone that you trust and especially just look at the reviews and stuff and understand, but that's the first thing I would do. Once you fix your

credit, the second thing I would do is work on building your credit lines. So work on getting credit cards and don't use them. Don't you use a certain percentage of what it is? You just don't use it at all? I have over 35 credit cards and I use three of them. Okay. You're just, you know, You obviously want to use a little bit of, like once every six months, you want to use them to buy like a lollipop or something so they keep the credit line open. But the reason why you don't want to use them is you want to create a big buffer between your total credit and the credit you use. So if tomorrow I wanted to use, let's say, $30,000 on my credit cards, that's still 2% of my total credit. Okay. So that's not going to make my credit go down.

it's just going to stay the same. That is fascinating. I never knew that. That's actually very interesting. And then how long would you say it would take for somebody to fix their crater? Because you know, you said there's a lot of these scammy gurus out there that say one month. To me, I think it's more realistic three to six months,

but you know way better than me in this industry. Honestly, six months is even very quick. Okay. Now I'm saying for those that are like in like just 600, I want to try and get it like a 700. Okay, yeah. So if you don't have any collections or, or any negative stuff.

You just have low credit because you don't have credit lines and stuff like that. You could grow your credit in six months easy. Okay. Like that's easy. You just go get a couple credit cards. You use less than 30% of your total credit limit, right? So if you have a $500 credit card, you calculate 30% of 500, this is how much I can use. And don't use more than that and pay it off every single month.

Okay. Okay. Once you build that up, you go get another one and another one and another one and another one and another one and you just keep doing that until you have 100, 200, 300,000 in credit line and you could go use as much as you want and it's not going to affect your credit score. The fun part comes in where you have $300,000 in personal credit lines and then you can go get a business credit card that doesn't report on your personal credit. So I could go use $100,000 in my business credit card and it doesn't affect my personal

credit because it doesn't report to the personal. That is interesting. And so right now with the Airbnb, when you got the 10,000 credit card, it didn't ever affect so you can actually max it out. Max it out. And then it will not affect your personal thing. Exactly. This is a whole course.

Yeah, exactly. This is interesting. Because nobody ever learns these stuff because I'll be honest. Some people, I understand the importance of paying for mentorship. I do that. I think it's very important because people are with you. There's a lifeline. You can call them.

I'm struggling with this thing. It's important. This information, nobody, like, I've never, ever heard of it because I always had the perception that a personal and business are somehow linked because they look at your personal history when they give you a business line. And that is correct, like you said, and that's why it's so important to have good personal credit. So when you apply for business credit, they give you big credit lines, but when you use that

credit line in the business, it doesn't report to your personal. So the entire purpose is just get as much. personal credit line and just use your business. Correct. Walla. Yo, you lived, you learned. Yeah. And all of this, obviously, is learned by me.

I honestly live on YouTube. I watch YouTube literally 24-7, every single financial podcast, every single credit. All this information that I know is out there for free. That's the thing. YouTube is a new university and it's for free and it's very educational as well. So I love that. So now about your other businesses, which one would you say is probably the most profitable for you in this current market? So profitable, I would say they're about equal now.

Okay. Yeah. The side business has grown enough for it to be equal to my main business. Which is insurance. Which is insurance, yeah. So I started insurance nine years ago, built my own. franchise and I have employees. Again, I think the biggest thing with me is I find ways to automate things. I find ways that the how can I make the most amount of money with the least amount of work?

People think I'm a hustler or grinder. I don't like to grind. I like to make money while I'm sitting down. I like to make money while I'm watching YouTube about how to make more money. That's me. So I don't like to be out there hustling and grinding and doing all this stuff. I like to see, okay, how can I find a way to make money, put someone there to do what I was doing, and then I could go sit back and learn another business that I could put more money into and build that and then put someone there and then find, that's what I like to do is automate my businesses so that way I don't have to hustle and bustle and work the 10 or 14 hour a job answering emails. It's like, why am I doing that?

Why can I just put someone to do that? Oh, I've actually answered my question. Because I was going to say, isn't the dangers of running a business sometimes delegating too early? But you spoke about pretty much the stuff like the answering the emails, the calls, the front line kind of stuff. The big picture stuff, that's what I'm involved in. Okay. The small picture stuff, answering emails, dealing with phone calls, dealing. with clients, dealing with all that stuff, I hire employees and train them so I don't have to

deal with that stuff. Okay. No, that makes per-that that answers my question. Yeah. Everyone has a different answer to this next question. Do you think people are often born entrepreneurs or do they become or can become entrepreneurs? That's a hard one. The reason why I'm an entrepreneur, one is I was pushed into it. That's why a lot of immigrants are entrepreneurs is because we're pushed into if we don't do this, if we don't figure life out, we're going to be stuck in a place we don't want to be.

I was very fortunate as a child, as a kid, to have a very fun childhood. I had my parent, my dad had, we weren't rich, but to Mexico, we were. Okay? Maybe here we were like middle class. Over there, we were high class, okay? And the reason why I say I was blessed with that is because when you taste something, right,

when you taste a candy and then they take it away and you remember what that candy tastes like, you want to have that candy again. 100%. So that's what happened to me is unfortunately when I was, about 20 years old or 19 years old, I had a problem with my family and I kind of, they kind of like let me go in a way. And I didn't have communication with them. I was kind of banned in a way. And I remembered the taste of that candy of having things that I didn't have anymore, right? And so that's what I was blessed with is I tasted the candy of riches or wealth or,

having money, right? And so when I came to the States and I only had a thousand dollars and I had to figure shit out, I had to do things to go back to that lifestyle. And the reason why I work so hard is because I want to live that lifestyle again. I want to have that lifestyle and live that lifestyle and maybe even do bigger and better things that I had before because I tasted it. And that's why poor people, unfortunately, that have never tasted money, they have resentment against money because the only thing money has done to them is make them even more poor, because the rich man keeps the poor man poor. And so I feel that there's a resentment towards money because they've never had money.

Okay. And I often think the term poor, in my ideology, in my understanding, it's more psychological thing more than it is like an actual physical thing. A hundred percent. And that's why I say it wasn't like we were very rich. We didn't have a lot of money like cash money. My parents, my dad, my grandfather were very hard workers. And that's what they taught me. They taught me the riches of being a hard worker. They taught me how to generate income out of nothing. I used to work for my grandfather when I was like five or six years old. I used to like clean sand and put the, put grass in his, in his front yard and do things for him and make a

little bit of money, which made me a hard worker. And so one thing, like you said, it is psychological. The poor man remains poor because they don't learn how to be rich. And that's why books is so important to read, is finding those books like rich man poor, rich dad, poor dad. One of my favorite books, by the way. It's a blueprint to my life. Yeah, yeah. I mean, I used to work at a call center when I finished selling pest control. I came to Utah, worked at a call center for six months, and hated my life. I did not enjoy what I was doing. And while I was on like free time on the calls, I would read Rich Dad, Poor Dad. And when I finished Rich Dad, Poor Dad, I quit my job and I looked for a job in insurance.

Wow. Yeah. I love that. Just because I changed my mentality. Perspective is everything. Yep. Awesome stuff. Now, with the last two questions,

as we about to wrap up over there as well, I want to know you spoke about like just the, pretty much spent four hours in your schedule per day, right? Is that just for one business or is that pretty much to what Tim Ferriss said the four-hour work week? No, that's just for one business. Okay. Yeah, the insurance business requires a lot more time because I have a lot more clients.

I have anywhere between 3 to 4,000 clients in the insurance business. It requires me to work a lot more in the insurance business. Again, that's my main business. The Airbnb allows me to work four hours in it because I have management that can deal with a lot of the smaller problems. I love that. Now, as we conclude, we often ask our viewers and guests, sorry, our guests rather, this very important question, you know, it's the co-winning insights we need today to seize the world tomorrow. In your definition, what is winning?

Winning has a lot of meanings to me. And winning, in this case, would be success, okay? And success has different meanings to each person. One thing that one of my mentors taught me was to learn what success meant to me. and the easiest way to do this is sit down, grab a piece of paper and a pen, and write what you want for your life. And then next to those things, like I'll give an example, you want a house, you want a car, you want vacations, you want a second house, etc. Right? You want a wife. You want kids, all these things, right? Write these things down. And then on the right side, write how much that cost on a monthly basis. Okay. And then,

then once you do that, you total everything out, and then whatever that total is, $20,000 a month, $30,000 a month, $50,000 a month, whatever that total is, if that is your definition of success, if that is your goal, once you reach that goal, you should have achieved success. And that's what I call success or in this case, I forget what winning, winning is once you achieve that goal, you are winning. Powerful. Awesome stuff. Well, Stephen, if you could let the viewers know where they could get a hold of you, so your socials, if you're having a course, any events, anything that you're doing, you just let our viewers know as well. Yeah, for sure. So again, I'm on Instagram, Steve Arbitrage, so S-E-E-V-E, and then Arbitrage is on Instagram.

You can reach out. Again, I'm here to help. I'm not a guru. I'm not here to sell you a $10,000 coaching event or anything like that. I'm here to help. If you have questions, reach out to me on Instagram. I'm more than happy to answer any questions. And then if you want specific one-on-one coaching, I have a link there where you can book a call with me

and then see if you're eligible for me to coach you and do a one-on-one basis, as well as direct you to my course. Ladies and gentlemen, Stephen McComb. Thank you. Thank you. I started building a supply company and was getting ready to start that up and then 9-11 happen. And my investors backed out, all my money and all my resources backed out. And even my supply chain backed out.

So I said, well, I'm getting married. I got 80 bucks in my account. And I have no idea what I'm going to do. How to do things the right way after doing them the wrong way. many times. And I just trial and error, man. I think, you know, any entrepreneur that you see say it was a similar story is as they went through that process of beating their head against the wall. We were right on age 20 and 21, I figured out that this was, this was where to go. And I started going that path and then just built one after another and, you know, kind of use those successes to

apply my passions. And then the real magic is when you can connect your passions to your businesses, right? Then, none of the fun, but it's also internally rewarding. Real passion pieces was it. We landed a contract with New York City in the late 2000s to manage all their equipment. So they had firefighters that had all this equipment and gear to do threat detection now to make sure we don't have it under 9-11. But no real way to keep track of it or maintain it or make sure that it was even property measuring when they went on the field. The great recession in 2008 and 7, 8 and 9, you look at COVID. And now the question I want to ask you, especially with your experience, how can somebody build a recession-proof business? I think there's a lot of people every

day to ask themselves that question. And I will tell you, there are a lot of big money people. That is the key word for them. How do I buy and acquire recession-proof businesses? And especially right now with where we're at, you know, I think there's a lot of people think we're on the verge of a recession. I personally think we have more...