The Iced Coffee Hour - Meet The Man Who Owns 100 Lamborghinis For $10 Million Per Year

Episode Date: January 12, 2022

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My name's Houston. So far the podcast has made $354,000. Almost. Oh, not bad. Good guess. If we divide that by two, then you would have been right. It's $153,000 ad revenue. Not bad.

Yeah. For 70 weeks. Yeah, it's not bad at all. Jack counts down to the weeks. I feel like that's more appropriate. Yeah. Yeah. Seventy weeks, yeah.

Like a year and a half. Yeah, but I mean, if you break it down weekly revenue, right? I guess so. Pretty much the way to do it. It's easier to multiply. So the next person on the podcast can just add like $10,000. This is true. And then they might be right.

So every week you just add $10,000 and you're doing a good. Yeah. Well, thank you so much for coming on the podcast today. This is something I've been really interesting talking to you about because you have, first of all, a very unique YouTube channel where you rent out some of the world's most expensive cars and people will either wreck them or you wind up making a lot of money from renting these cars on a daily basis, sometimes hourly basis. How many cars do you have at this point that you rent out? You know, that changes so much because cars are coming and going, but I typically keep

between 50 and 80 cars. And that's a collection of exotic cars, hypercars, sports cars, SUVs, luxury cars and then you know you have the auto cycles so everything combined between 50 and 80 and it's kind of seasonal right you don't want to have a hundred auto cycles in December when it's a little too cold and then you don't want to have 100 in the summer when it's 200 degrees outside so uh it fluctuates quite a bit but the youtube channel is predominantly now i mean it's kind of overrun by all the bad in the beginning i made the youtube channel and i was like so excited i would go and film all the times I'd buy a new car and, you know, save up the money and build my business. And now it's just turned into all the bad things that are happening.

So every time... Give us an example of that. Well, like, what stands out the last six months? So I'll actually give you like a little sneak peek. These videos aren't out yet, but I could now talk about them. We were the first company in the entire world to have a Huracont STO for rent. And the third or fourth renter drove a little bit to aggressive. next to a construction site and jumped off the side of the road.

The car was essentially totaled all the body panels. There was like a couple hundred grand in damage. So the insurance company accepts liability. It takes about six months. We go, we take it, we get it fixed. One of my employees picked it up about three weeks ago and drove out of the body shop were a woman with $20,000 worth of insurance policy hit the front end. No.

One minute after getting this thing fixed. you serious and basically totaled it again I hate to interrupt did he not see this this lady come he was at a stoplight he was at a stoplight and the light had turned green he went to go and we have it on camera actually

it's a very vague camera there was a guy with a dash cam behind him but she runs a red light and takes the front of the car up just like that and it's so unfortunate because it's $146,000 of additional damage that we only are going to get

$20,000 for and when you rent cars, insurance is so complicated. It's actually my best interest to not file a claim on my own insurance. Because right now, my insurance policy is like about $800 to a million a year. With any claim, I've never had a claim. With any claim, I'm literally like scared out of my mind to file because I think they're going to either drop me or they're going to raise the rates like 20%, which could be 200,000. dollars a year. Since the pandemic, it's just all bad. Like anybody in the rental car business, I kind of feel bad for you guys. You know, it's not the best time to be there. So it costs you

a million dollars a year just to ensure your vehicles? It does. And like I said, that fluctuates. So now it's really funny. I had a conversation on the way over here in the car with, I have a partner in the business. He's an orthopedic surgeon. And I told him, I said, we now have to look at our business, not in terms of what each vehicle revenues us, but what it costs to insure. So about a year ago, so I'm sorry, 2020 went by too quick. So a year and a half ago,

our insurance was about $400,000 a year for the same coverage since the pandemic. And this is nationwide, right? I mean, these insurance companies aren't just local to Las Vegas. They don't just do like four or five companies. They're doing hundreds of companies across the board. And they decided to basically,

say take it or leave it. We're going to cancel you or you're going to pay like three times the rate. And companies like mine who kind of have like a long track record, I mean, I'm seven years in the business now. I don't really have the option to just close up shop, right, and just start a new business. You know, I'm kind of, we've got employees, you've got long leases, we've got a huge business, you know. So it was for me, I had to accept that raise in rates in November. So now since November of 2021, the rates have been three times the price. So yeah, we're paying almost a million bucks, two and a half times the price. Wow.

So when you're talking about revenues on each car, what's the most profitable one? A hurricane. And that's why I have like 14 of them, right? So a hurricane is the easiest car to use. Yeah. Right? It's easiest car to drive. And it's the most approachable for anybody that wants to try an exotic car for the first time, right?

It's basically like a Huracon and like a Rolls Royce Cullinan. Because the colonin's like the one that fits the most people. So typically a family would rent that car and they would take it for multiple days and the Cullin being such a new car doesn't depreciate as much. So we're able to obviously make more money if it doesn't depreciate. Right. And Hurricanes are pretty much the same because they're so reliable, people buy them for higher value used, right? 14,000 miles on a McLaren is totally different than 14,000 miles on a Lamborghini. Right.

And I mean, I think you know that because you're a car guy. and every specialty, specialty car depreciates so much more aggressive than like the general Lamborghini mass production car. I mean, essentially, Heracons, the most mass and widely produced exotic car, right, as was the Gallardo.

You know, so it's like kind of that similar mid-engine Lamborghini that we do. So how much you buy the car for and how much is it rent out a day? Or how much revenue does that bring in a month? So, we'll break it down by car. Okay. We'll use a general car.

The Hurricanes are a great example because the base price of a Hurricon is mediocrely about $250,000. I order every car brand new. Every single car in my fleet, I order myself. I spec my own options. I have orders up until 2024 currently. Wow. So my business has all planned out just two, three, almost two years in advance. I order the fanciest colors.

So I kind of pay a little extra for that. It's $20,000 usually for an extra color on a car. But I don't spec them with a lot of carbon. Carbon's the death of an exotic car. You know, that's where you go crazy $100,000 in options. I mean, visible carbon pack on a Ferrari could be $40,000, right? That's crazy. So I get them bare bones, but really cool looking.

So they're about $275,000. And we'll rent that car per day for $1,800 after tax, which tax in Nevada is like almost 30% for car rental. Why is it so much? We have the highest tax in the whole country. We actually have the highest hotel tax. We basically have the highest tourism taxes. But that pays for basically the other state income tax.

So they tax people on rent-al cars. Essentially, yeah, we have no state-income taxes as an individual, but they get all their money from the marijuana and the rental cars and everything. So we get about $1,200 bucks from that, right? So you have all those taxes and fees and stuff that we don't get, right? We get $1,200. and the average person drives about 140 miles in that 24-hour period. So we're getting essentially $7 to $8 a mile. So my goal is to make about $75,000 per 10,000 miles.

That's my goal, right? And so if I can do that, we can pay off, not pay off, but pay down and, you know, whatever you see as the investment, that car, 10,000 miles is two and a half, half months. So in seven to eight months, we get our initial money back. Right. And if the car can go one year, which typically it does, right, we're able to get, you know, a profit from that. And then we get to sell the car for whatever's left. Since the pandemic, it doesn't really play out that way because I'm not able to get so many cars. So getting cars right now from a dealer's kind of a luxury. So we're keeping them kind of shorter, right? So we can kind of mitigate the huge miles. Yeah. But, you know,

You know, essentially you're making about double what you pay for the car every 12 months. You know, what's the least profitable car? McLaren. Why? Because they break every day. And I keep a McLaren for like 3,000 miles. I can't keep a McClare. Really?

If it hits like 2,500, I'm already starting to sell it. So I buy them brand new. I'll rent them for like one. The McLaren's drive less than Lamborghinisies, like a lot less, like 50% less. So when someone has a McLaren, they typically don't. drive it because they're less comfortable. They're not uncomfortable. Yeah.

But they're just not as comfortable as something like that. So they'll drive them about 75 to 80 miles. They'll do like from the strip to Red Rock and back. Or someone in a Lamborghini will go from the strip to Red Rock to Hoover Dam and back. Right. So they do a little extra. But those cars break too much. And so we lose them for quite a bit.

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Subscribe. I think it would be interesting because you're so young and very successful. How did you get to be so successful at a young age? When did you start this? And what did you have that made you so successful in this space? How old are you? I don't know how old you are. I'm 33.

So I'm super old. Really? Yeah. I mean, I might look 21. Yeah, right. But yeah, I started when I was 25 or 26. I was a cable guy and I was traveling all over the United States doing like strike work and hurricanes. And I was making a few thousand bucks a week.

It was good. I had a GTR, Nissan GTR. It was like I had a car payment. It was like $1,600 bucks a month. And I was in town in between the traveling jobs. And I got hit by a Hummer H2 while I was driving. I had a little mini Cooper John Cooper. And I got rerended and I broke my back and I wasn't able to go and I had to carry this big 28 foot ladder as a cable guy. And I wasn't able to do that anymore. So I was trying to find another job. And in the meantime, I thought, well, I have this really cool sports car. If I give it to a car rental company, they'll make enough money to pay me the payment. Right. So I went there was like six or seven car rental companies in Vegas at the time. It's like 2015. Yeah. Every single person said down. They were like, why would we rent a Nissan? And I was like, I was like, I

I was trying to explain this car and how cool it was to these old men that had these 355 Ferraris and this this weird vibe, right? And I couldn't really wrap my head around it. I was like, wow, this is the exotic car rental industry in Vegas. Everybody was so pessimistic. So I'm driving down Las Vegas Boulevard and I see another GTR on the side of the road and a guy has drive me for $99. And I'm like, oh, yes, this guy gets it. I've seen those cars. So parked on the strip.

Yeah. Yep. They're in the windshield. Always drive me $99. So he had... They had a yellow guy harder there all the time. That was actually my car. No, really?

Yeah. So we'll get to that part. Okay. But, so that space that you're referring to, they had leased a month or two weeks before I had met them. It was a couple of Israeli guys. So I went to them and I said, hey, like, can you guys buy my car? Because at this point, I was like kind of beaten down. Everybody said, no.

I was like, no one's going to rent my car, but maybe they'll buy it now. They already had a white GTR, and mine was red. So I go to them, they said, no, I don't want to buy your car. I'm like, red. I'm like, oh, my God, again with these people, you know. So they said and agreed to let me stand next to their white one. And after their white one got rented, I was allowed to rent my red one. But I had to do all the work.

And then I would give them 50% of the profit. And me being like 25, 26, I'm like, that's a great. Great idea. It's not in Las Vegas Boulevard. So anyways, a little bit longer story short, I go out there and I start renting my GTR and I'm sitting in the back seat while I let people drive the car on like a little predetermined route for $150. I raised the price a little bit because my GTR was a modified, had 800 horsepower.

So it was a cooler experience, right? You trusted someone else to be in the car. No, but I was so young and I had no clue what I was doing, right? So for me, I was sitting in the backseat. I would be nauseous all day. I was taking about 10 of those dramamine pills and they weren't making a dent. So after two weeks, I said,

oh, I can't do this anymore. I let my first guy from Boston, okay, I'll never forget this guy, take the car for $600 by himself to Red Rock and back for two hours. He went up there, he went and did some donuts in the rocks and sprayed the side of my car

with a bunch of rocks. The first, rental I ever did, this happened. And I'm just sitting here like, oh my gosh, what did I do? I made a huge mistake. But I don't want to go with these people. I don't want to sit in the backseat. And so I just kept now my car was messed up. Yeah, had sprayed rocks all over it. The guy dumped it. He didn't pay me. It was a big huge mess. And I felt, okay, whatever, I'm in it now. So I just started letting everybody take the car. I just crossed my fingers it would come back. And six months later, I had like eight cars. So,

I had the yellow Gallardo. Yeah. I had a white R8. I had a red California. I had a whole bunch of slingshots. And then I had a bunch of scooters. Now, I'm curious, how were you able to get financing for these cars to begin with? Because getting the GTR, obviously, you had a good job.

You're making a few thousand dollars a week. So how much were you making a month when you got the GTR? Well, when I was renting those cars, right? Oh, well. When you bought it. When I bought the GTR, I was making like $18,000 a month gross. Wow. But it was all piecework.

work. So I wouldn't make it consistently. Yeah. So you'd only make that money when you were working. So you would get a job for three months, make, you know, $50,000. And then you'd be out of work until the next strike or the next hurricane. So you'd go into work at like a $1,500 a week pace. And then when those big jobs happen, you get like $5,000 a week. Wow.

So it was okay. But how are you able to get financing on these cards? Because even for me, I looked into this a few years ago and it was so difficult. wanted, there was a brief moment where I wanted a Gallardo Super Lusera. Brief moment there. Very nice car. And you can speak with the banks, it's just like they wanted you to have a history of working your way up.

And since I had always paid cash for these cars, I had never had a previous loan. They were like, well, we want you to have a mid-tier. And so you don't just go from nothing to this car. So what you're talking about happened to me when I went from the GTR to the Gallardo. Okay. And so I bought the 2006 Gallardo Spider, and it was $116,000. I had only had a loan on my GTR, which the GTR I bought for, I believe it was like low 70s.

It was a 2015. And they were giving like $20,000 off MSRP back then. There were GTRs were $106,000 bucks. They were really hard to sell. And this one was a demo, so it had miles on it. So I think I was out the door just about $80,000. And I put $10,000 down, right? So the down payment is the most important part of financing a car, right?

I mean, there's a lot of guys on the internet that'll tell you zero. down this, zero down that. I mean, it's, I don't get that. No one does those loans. In the car business, if you put 30% down, you're automatically approved no matter what. You could tell them you make a billion dollars a year and they won't check it if you put 30% down. It's like the golden rule for financing cars. So when I, when I got the Gallardo, I already had the GTR and I didn't really want to trade it in. I wanted to keep it, right? Because I was kind of like, well, this car's making money. I don't want to sell that one just to get a different one to make a little more money. I want to make a lot more money and have two. So I saved for those those months that we were

making money. I had two months that we were making money and I say $40,000 from the rental fees, right? And so I was able to put $40,000 down and I financed it with a company called Putnam leasing, which is like a 20% interest, crappy bank. But when I was that age and I was making from the car, I didn't really matter to me. And so they don't put it on your credit report. They don't really write it down unless you do like a bad deal with them. It's often it's under the table. It's a leasing company.

And most exotic car financing is like that. So two months after that, I was able to go to another leasing company, and put $40,000 down into Ferrari, California, which also did not report to my credit report. So all I had was this GTR on my credit that was with the regular bank. Yeah. And so now I had three cars. And those three cars were making enough money for me to buy a fourth car cash.

And that was a McLaren MP412C. So by the time I had four cars, it was a lot of money coming in, right? But then there was a lot of money going out. And so essentially, after about six months, I had a lot of things. I had scooters. I had slingshots. I had all this stuff. I had a bunch of car payments.

And the city came down and sent these two guys a letter. And basically they were doing business on a business license. Well, they kind of had a business license, but it was at a location, like a warehouse on the side of the strip somewhere, and they were doing business in the front. So I was, like, kind of, like, completely shocked, and they shut us down. Wow. I had all this debt. I had all these cars. I had 35, 40 scooters that I was renting, and I had nowhere to go.

And these guys just kind of packed up and were like, sorry. It's like, what? And I was, I panicked. I had no idea. I went home. I, like, started crying. I was like I told my wife I sold my house for us to expand this like little business right I had had to buy some you know time money to pay my bills because all that money wasn't going to pay my bills it was going to pay my for cars so I sold my house about a month before this happened and my wife almost killed me I'm pretty sure that she wanted to so uh I use the last $15,000 I had and I leased the space that you went to so I didn't did any at any point it crossed your mind just like one You know, I could sell off these cars.

I built up some equity in them. Yeah, but then it had to be a cable guy again. And I already had this cool lifestyle where, I mean, after you buy a really nice car, I don't really care what it is. It's old and you want another one after a couple weeks, right? Like there's always another one. There's always a better one. So after I had gotten three really cool supercars and I still had the GTR and then I had a slingshot,

I had all these things. And my family saw like how I was doing so good. And yeah, I was really innovative. I mean, no one had really kind of done this before hourly supercar rentals, right? It was a new thing. So I didn't want to let anybody down. And I really didn't want to show any weakness. So no one actually knew besides my wife that the business wasn't like cool.

And I was kind of young and dumb. And so when I went, I leased this space at Dean Martin, the one you went to. And I just put up a sign out front and people from the Belagio could see the sign. And they called the day I opened. I mean, I went through the licensing process. I got all my stuff situated, right? And that took about 45 days, right? So through that time, leasing it, getting all of it ready, I went down to zero dollars, like nothing.

Like, my credit cards are maxed out. I had no money. And the only way I was going to survive if I had rented those cars. And the first day we opened, I did. And so kind of like the rest is history. Yeah. And when you were working with those two guys using their lot, were they just making bank off of you if you were still giving them 50% of what you're making at that point wouldn't you have realized

that it would probably be better if you were to get your own lot if you're paying them half of your so i wasn't only just paying them half i was actually paying them fees as well they were charging me for insurance which there definitely wasn't insurance right i mean they they keep telling me to this day i mean not to this day but a few years ago i had ran into one of the guys i'm like dude just tell me the truth was there really insurance because it was like $10,000 a month and i'm just sitting here like was there really insurance and he swears the state there was insurance. I was curious how that worked, how the insurance, like if a car was wrecked, so you didn't have insurance in your name in that car. At that time, all those cars

are registered to my personal name. Oh, wow. And they were all personally insured by me, which if you were to have rented the car, I would have been screwed if you would have crashed it. Because I wasn't, I didn't have my stuff together yet. Yeah. Like I didn't know what I was doing, right? And I didn't understand rental contracts. But, When I was forced to do this on my own and I had no one else, I had to learn. I went to the DMV. I got my license to sell insurance. I became an insurance broker, insurance agent.

I got my license to do every single thing, car sales, car dealer. So I went through the state stuff. And I mean, I'm actually like pretty interested in learning the law and to do it the right way. So I spent a lot of time reading all the manuals and the books for the DMV and everything. And so through this process, I actually became relatively smarter, you know? I mean, it was a good learning experience. And now that's why royalty still exists. The typical age of an exotic car rental company is like a year and a half to two years.

Why? Because they don't do all of the things the right way. They did it how I did it in the beginning where there's no insurance and you had all your cars financed. Now there's no royalty cars financed. I mean, there hasn't been for years. But being in the beginning, you know, I wasn't wealthy. I didn't have any money for my parents. I didn't have anything. So I just did it the way I could and I got away with it.

But today you can't do that anymore. I mean, now there's like so many players like Turo and all these other apps and ride share things and this and that. It's really easy for people to just put up one car on one of those apps and make a little bit of money, right? To do what I do to start and to get to the 50 car level. It takes a massive overhead. And, I mean, five years of YouTube videos, it's a lot of work. Yeah. Why don't you do Turo?

Why not put a few of the cars up there and just kind of capture that market as well? Because I have more customers than Turo now. I have a wider range. Actually, Turo like four years ago, reached out to us and invited this. We put some slingshots on Turo and like the first customer crashed it. Like that wrecked it, but like destroyed it. Like the front hit the curb and everything. And Turo said because we were a commercial business that we're on our own.

We just pay for it. And I was like, well, that's not okay. Like doesn't the customer have insurance or something? So we had like a really bad experience. But they take 30%. And sometimes, up to 50%. So if I have my own network of people, you know, we have our own business, then why would we want to give it away for no reason? I mean, that's like paying Google ads

or, you know, some advertising service, right? And plus, Turo is actually kind of a bad business. They don't really price match or price cap different categories. So if you have a slingshot and yours yours is 500, mine could be $5. It could be $20. It could be $100. We can set our own prices and that's kind of unfair to the renter because if there's like 10 of the same car the lowest one wins right and it works from the bottom up and the guy that actually knows what the value of his car is really never rents the car so it's kind of unfair turos should change their business model slightly i think it's kind of similar to Airbnb though where people could set their own rates and you know you want to stay competitive but at the same time you want to try to maximize

yeah but Airbnb isn't like like for like right it's not like you're renting the exact same thing. It's true. Yeah. So like if I'm looking for a Lamborghini Huracon and I have one for or you have one for 1,000 and he has one for 500, well, who do you think I'm going to rent? It's the same thing, right? So the same condo isn't the same condo. You know, I mean, it's like a little bit unique. And Airbnb is actually relatively competitive. I mean, they're all pretty much the same, you know, I think in the car world, because people have different car payments, they have different insurance payments. The variety of people that have, have them, right, in their current living situation, dictate the price that the cars get rented for. Got it. Right. If someone wants to make $500 a month or $5,000 a month, that determines your price point. That's interesting. How much are you making now from the entire rental car business, just overall?

Because I'm curious about if you, if you're comfortable sharing, some of the numbers behind it. It depends. With COVID, we did really good and then we did really bad. We did really good and we did really bad, right? So we don't really know where we're going to sit, but typically with the fleet size that I have, it should be a $6 to $8 million a year revenue business, right? That should be adequate. We've done better than that, and we've done worse than that, you know? So it kind of fluctuates right now quite a bit.

Yeah. But then it's also the overhead, right? So then you have leasing space, insurance. What about gasoline or repairs? How often do these cars need to be repaired? Well, damages are prevalent, right? damages happen every day. I actually started making my own wheels.

I'm like I manufacture my own wheels now because they were damaging so many wheels and Lamborghini and Ferrari were unable. They don't make that many wheels. Like they don't have them in stock. So like curbed wheels happen sometimes three to four times a day. And sometimes they crack. And like I'm kind of against powder coating because I'm like a firm believer. If you powder coat your wheel too many times that we can see integrity of it.

And I don't really like to take risk. Like I don't leave myself. open for anybody to assume me. So we make our own wheels now. That's how many damaged wheels we get. So I've got like a warehouse full of 600 sets of wheels that are ready to go at any given time to replace on a car. I stock like almost every bumper, every brake pad.

The way you make money in car rentals is to never have the car unavailable, right? And if you come and rent the car and you get a flat tire, it may be your fault, but you're going to want your money back. So like I have a van specifically dedicated with the tire machine and everything built in I can drive to you and change your tire right there. I'm really, I don't like giving people their money back for things that I can control, right? So the car rental business is very demanding for extreme immediate service, right?

And when someone feels like they get that service, you get the amazing customer and you get very loyal people that want to rent 10, 20, 30 times. And when you're renting a car at the price point that we rent, that's a great customer, right? And that comes down to service. So the typical person rents one time. But like right now, we're seeing like a 30 to 35% repeat rate because of the pandemic. Because there's not that many things to do.

People are coming back to Vegas a lot, right? I mean, if you live in Southern California, there's more restrictions there than there are here. Right. And if you live in other states like the East Coast, there's also more restrictions there. So they come here more often. because they're not going to Europe or wherever. So right now it's okay. Do you think your average customer is someone

that's just trying to rent a car for a day and have a good time? Or would you say that they're like, because in my opinion, just from someone who doesn't know much about the business, I feel like a lot of people would want to rent a car to like show off, you're going back to your high school reunion.

Or you're taking a girl on a date, something like that. Oh, Jack, you should get a car to pick up a date. Let's do that. We could vlog it. Picking up a date in a Lamborghini or a car. Come on. I could not actually do that. Why not?

Jack, that is so embarrassing. You have to do it. That is so horribly embarrassing. I would not get a second date. Yes, you would. I guarantee you would make a difference. Listen, you would get a second date, but not a third date.

Because when you showed up in your regular car on the second date, then she'd be like, oh, what's this? I'm out. Yes, bait and switch. Second date guaranteed? Third date, probably not. Amazon presents. salsa, whether it's

Verde, Roja, or the orange one. For Jeff, trying any salsa is like playing Russian roulette with a flamethrower. Luckily, Jeff saved with Amazon and stocked up on antacids, ginger tea, and

milk. Habaniero? More like habanier, yes. Save the everyday with Amazon. Got it. Well, I drive a Lexus, too. Okay. Well, that's good. RX 330. It's all the same. Lexus is Lexus, right? Yeah, exactly. Very similar. You probably have better seats than I do. Mine are relatively uncomfortable. I got seat warmers. I don't know if you... I don't. He drives a Lexus LFA. I drove that today. Yes. Yeah. The customers come in are like 99%

today about showing off, right? There's like 1% that people come in and they rent cars for longer than one day where they're used to that car and they own those cars where they're from and they want that car while they're on vacation, right? That's like 1% of people. That seems crazy to me to be like, that's my threshold. I need that car everywhere I go. Yeah, I mean, it's tough because like you're a typical rental car person when they come to Las Vegas, Vegas is such an easy place to use that car.

Do you rent that car when you're in Dallas, Texas for business? Probably not. right do you rent that car when you're in Miami yeah like it's easy to show off in Miami just as easy to show off on Las Vegas Boulevard right and actually Las Vegas has a lot of cool places to drive and use the cars I mean you live in a wonderful place right I mean there's great roads out here

they're open they're clean it's all paved right so it's a good place to use the car too so I think we have pretty much a millennial focused business right now that is a lot centered around Instagram and people showing off but that's also a bad thing because when people show off, they make poor choices. I'm curious.

I remember seeing on Instagram where people were renting out the private jets on the inside just to take pictures and videos. Why haven't you done that with cars? People could go and take pictures with the car. The cars stays stationary, but you could have a cool backdrop or something. I mean, maybe we could rent a car to like selfie world, right?

Where that's where they do that. Sure. They have sets built out that are for people to take selfies and show off, right? I don't know. I think I'm kind of like trying to focus on the more, I want to say bigger money, but I mean, how much could, how much would you pay to take a picture in a Lamborghini? $20, right? Maybe. Yeah, give a.

A Lamborghini seat is $14,000. So how many people will take to ruin the seat? So you would need 700, you would need 700 people to make that money back just to break even and replace your seat. I don't know. Doesn't seem like a good of a business. That's fair. It's wild to me because I do see anytime you're on the strip, the people, and you always know they're the rentals

because they're completely stock, their bone stock cars usually. No tints and they're bright colors. Always. And the windows are always down and the music's all the way up and they're always looking around. Always looking at people. And they're like, oh, they're looking at me. They're looking at me.

It's kind of funny. They're looking. Yeah. And you can tell, because they're always, leaving first gear open till the end. Oh, yeah, yeah, yeah. And then the last, yeah. Last second shift.

Yeah, yeah, yeah. Yeah, so. Downshifting a little too early. Exactly. I kind of pride myself in window tint and black wheels. And I'm one of the founders of Rift exhaust. So like I try to put exhaust on the cars and make them a little bit more than the typical rental that you would see from another company. Yeah.

Right. Like I'm really offended by people that have silver wheels on their car. I mean, silver works on some cars, but like on an orange Lamborghini, I feel like it just should have aggressive black wheels and look more like it's your own. Yeah. Right. So that's kind of like a little bit more. Royalty has that ownership look. Yeah.

There's no like license plates that say rental on them or rent me or phone numbers. So that's always been kind of a staple of our business. That's interesting. What's shocking to me is the fact that you can start a multi-million dollar business or at least a. business that gross is over $1,000 a day with just like $30,000 to $40,000. I mean, I think that's most good businesses. I mean, I started a restaurant with not $40,000, but I started a restaurant with like $200,000, and it's already got, we've already got 10 locations, right?

Let's talk about that. Why did you decide to do a restaurant? Isn't that a business that so many people fail at? Isn't that a really difficult thing to get into? You know, I swear, I don't know why. but when people tell me that the number one failing businesses are the ones you obviously don't do, it makes me want to do those only. I don't know why.

It's like crazy to me. But yeah, like the restaurant was always a big thing. And I've always wanted to be in a quick service industry because I feel like the customer, I guess once you have the experience with a customer that spends $2,000 with you and the level of detail you have to have, everything seems easy, right? The level of responsibility, when I give you a $400,000 car and you give me $2,000, and there's no other money exchanged, there's no deposit, there's nothing else, it's a very large risk. And you have to be really focused on who you're giving that to.

Otherwise, you can end up on a YouTube video, right? Because that's pretty much the customers that get there, the ones that probably shouldn't be doing that. And when you learn that customer and you learn that type of business, you learn so much about people and the control you have within that atmosphere. So like for the restaurant industry, for me to give you a sandwich for $12, it seems like, like child's play to me. Like I'm like, it's so easy. You're either gonna ask me for $12 back because you didn't like it or you're gonna eat it and love it.

Or maybe you eat it and give me a three star review. There's like three options there. Sure. Yeah. You're not gonna take the sandwich and hit me in the face with it. You're not gonna steal it. and take it to California and it's going to get impounded somewhere

and I'm not going to be able to get it back, right? And you're not going to go and do crazy things and risk everybody's life and I have to file an insurance claim to get my sandwich back, right? So all of those crazy things that happen at royalty can't happen in a restaurant. So all I have to do with the restaurant

to be successful is to give you that same feeling you get when you get that $2,000 Lamborghini. And that what makes it easy? And it was $200,000 to start this up? Basically, yeah. I mean, we've spent more money since then because we have nine locations now, but the first restaurant, we spent a little over $200,000 at. We've made improvements after we opened, but we got voted the number one restaurant in Las Vegas on Yelp for 2021. And that restaurant grosses almost as much as our chicken or is our royalty exotic cars.

No, $8 million, $6 to $8 million in one restaurant? Well, we have two now. Okay. That are open, open. Yeah. We'll have, we have eight under construction. Two are open. Each restaurant's doing about $250,000 a month.

Wow. Out of 2,000 square feet. What's the overhead? Because I've seen on restaurants, it's like a 10 to 15% profit margin. Is that about accurate? 25 to 28 for what we do because we have one item. We have chicken, fried chicken. So we have an 84 skew restaurant.

Yeah. So we are just starting to sell franchises in January right now. But the hot chicken industry is like blowing up like crazy. So we're getting. getting an average about $7,500 to $10,000 a day in revenue, which is essentially 700 customers a day in a 2,000 square foot space at an average, average ticket at $21. So it's like really, really, really good business. How do you get so many people? I mean, YouTube helps a lot. Yeah. Right? Because we're popular. Is that the channel? Um, your channel or is it, is there another like

Houston's chicken? No, there's only, um, mine. That would be fun to vlog to behind the scenes. of that. So I would be great. We're my business partner, Edmund. He, um, uh, his YouTube channel was Edmund Mondi, I think, uh, or Mondi. And he's, uh, he was a professional race car driver. So since I have royalty and I'm like full fledg in my rental car business, I put like 50% of my time in the business, but he's 100% there.

So he is vowed to change his YouTube channel to basically the Houston's hot chicken YouTube channel where, I mean, we have like some of the hottest chicken tenders. in America. So like we have like this game called tender roulette where there's like six tenders and everybody grabs one and some have no spice and some have the you don't want to taste that spice because it could kill you. Right. And so we have all these like games that we play and that's what his channel is going to turn into. So the tender roulette, I mean the tender eating competition, how many people can eat the spiciest stuff. It's really fun to watch. Like that stuff right there for me is exciting. You know it's funny. I think this is pure coincidence but I don't know if you know this guy on

TikTok. He goes hooked L. I think it's hooked LV. Yeah, he's a big, he actually runs our social media. Are you serious? Yeah, well, I mean, he's awesome. Yeah, he helps us run our social media. So his video came up. Now, I'm, I have two TikTok accounts. One of them is my, my personal one where I watch him. The other one is just a random one that, uh, just for, you know, random scrolling or whatever. But, uh, his video came up on Houston's chicken. Yeah. And it was so good. And he actually reached out to me, uh, as just a subscriber.

when we moved to Vegas and we met up with him. Yeah. He's such a smart guy. Yeah. So I met him when I first, first started the idea of opening this restaurant. This is early 2019. And he was working at Whole Foods. Yeah.

And I met him there. And he was talking, showing me his vlog or his account, his TikTok. And how he does restaurant reviews. And I'm like, man, like when we open, you're going to be my guy. Yeah. So we had talked to him for, I mean, I had seen him in Whole Foods. He was working at like the little deli thing. I'd see him for like a year before, you know, we shut down and everything.

I was going to the grocery store all the time. And I would always say hi to him. We chat and talk. And so when we opened, he was my guy. I mean, he was the guy that helped us. So we gave him the contract to do our social media. Yeah. And he's great.

And he actually has a lot of really good ideas too. And I'm hoping he has a really cool burger place I want to invest in. But that's maybe for the future. Yeah. There's something else here now. Something new. From exclusively on Paramount Plus, it's the C.

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Yeah, I'm thinking this would be so viral to be able to do like that, you know, the hottest chicken ever little challenges like that i mean there's so much content you can make with food because it reaches such a wide audience that's like what the car business is tough because it reaches car guys and i've like i mean we're mutual friends with stradman right and i talk to james every once in all when i go up to utah and i'm just like you know james like what's next i always ask him and he never really gives me a straight answer but what's next for him yeah because i mean how many more subscribers can he get right i mean he's been doing it though which is crazy i love i love him for the year I'm like, what else could he do?

But he keeps delivering on just great content. It's wild. And so like once you take, get out of that niche of like one specific thing, right? Food is like a completely open genre that reaches the world's population because everybody eats. Everybody wants to, you know, we release all those really great, what's the word I'm looking for? But like the serotonin in your brain when you eat something really good, right?

People crave it. I mean, that's why we're all overweight, right? I mean, that's why I'm overweight because when I'm stressed out, I love to go eat something good. I'm trying to lose that. That's my resolution this year. Is it really? I've made my resolution to never want to lose my weight because like it's just something I always

try to do and I just can't. So I just accepted the fact that I'm just going to eat good. You know? I'm eat healthy. I don't know. I think there's a balance. Like I'm hungry right now and I'm resisting. I'm starving right now.

I'm so hungry. See, now we're talking about chicken and I was like, geez, that would be. Yeah, you'd make me so hungry this whole time. We could have sponsored this episode. It's brought in some chicken. Oh my God. We should have. I didn't think about it.

We should have had one of our, we get like four or five burgers, and one of them should be the really hot one. And we all agree that we have to eat that one. I'm vegetarian. Oh, Chad is vegetarian. If you are, I can make you a... For 30 days. I can make you a Houston.

So Houston, we have a problem is our hottest sandwich. That's a great name. Right. And so lift off is the one right before it. And then you have spicy, medium, mild. And then we have a Memphis dry rub. And then we have one that has no spice at all, just chicken for kids. Grams.

And regular, you know, stuff. For me. The Memphis dry rub is kind of like my favorite because I try to, I have a pretty weak stomach myself. So I try not to eat anything spicy. So that Memphis one's pretty good. But Houston, we have a problem. We can make it a tofu. So you can do a fried tofu for you.

And it's actually not bad. The tofu is good. It's the first time I've ever tried tofu. I mean, we fried it and put all the seasoning on it. So kind of tasted like chicken to me. But one thing I thought that you did that I really liked a lot, didn't you host a car meat outside of Houston chicken chicken chicken chicken? That's growing the restaurant. Yes.

Going back to that, we do car meets once a month. And we bring, I mean, we had four or five thousand. The F spot video was out of Houston's hot chicken car meat. Yeah. It was like four or five thousand car show up. Yeah, they invited me that night. It was at night, right? Yeah.

Yeah, yeah, I couldn't make it. I wanted to make it, though. Yeah, we do them once a month. And so for every grand opening, we have a few grand openings coming up. We have two in April. And then we're opening our fashion. show mall location on the strip probably in June. So that one's going to be hard to do a car show because it's inside, you know, the mall

on Las Vegas Boulevard. But for every new place, we have two drive-thrues that are opening in March, April, May, whatever those are. And those are going to be really fun because we're going to have cars all over the place. And those are great shows. So I've had this theory, okay? And I've had two friends in the past who have opened restaurants. We've always said when you open a restaurant, you have to have a car meet in the

parking lot. And both people who didn't do it, the businesses did not end up doing well. So from now on, I'm like, in order for a business too well, they have to do a car meet in the party. It works, though, because it gets so many people just parking there out front of the place. You get cool cars there. Everyone's like, oh, what are they? What's going on? Oh, it's the Houston's car meet. So we have, I think we have like, we have 410 five star reviews. We have seven one stars. And about four of our one stars, are because people were mad about our car meat. It was too loud. It went on too late. It was all the old grandma. Oh, it's great. I love it.

If I can get a one-star review that talks bad about how many people came to my restaurant, I think I'm doing something good, right? And the other three bad ones are because it's too hot, right? I mean, one guy walked in and was like, I need your hottest sandwich right now.

And then he said in the review that he has a sensitivity to spice. I'm just like, you know, were you on drugs when you do this? I don't feel like you should order the hot. There's two million scovil units. Two million. I don't know what that means.

Yeah. A normal mild Popeye spicy sandwich, right? Like, yeah, that's a Popeye spice sandwich. So good. 25,000 skulls units. 25,000 to 2 million. That's the difference.

How is that enjoyable? It's not. No one's supposed to eat it. That's why it's called Houston. We have a problem. You shouldn't eat that one. You had it? I can't even smell it.

I'm like, you never had it? No. Oh my gosh. I haven't even eaten the medium one. I'm scared. I'm like not about spice, you know? Would you eat it, Graham?

I don't, I hate, I hate hot. What if we had a competition, you and I, loser had to eat it. I don't know if I'd be able to finish it. I would try it. So the sandwich is kind of a cheery way to try it because you have coleslaw, you have pickles, you have our sauce,

you have the bread. The real way to screw someone up is to let them eat the tenders. The tenders are plain. It's just spice on spice on spice on spice. There's nothing else Just more spice

Somebody finished the whole thing Yes one of my employees Andre Is he must not have any taste buds He could eat this Houston we have a problem tender With a blank face and just eat it He doesn't even make an expression

His body is sweating You can see him physically sweating But like we've had people Take one bite and profusely puke Now we've had people pass out Like you have to sign a waiver Like, you have to wave like, you're like, legitimately, you could go to the hospital

if you eat too much of these particular spices. And so, like, it's dangerous. I mean, you're not supposed to eat scorpion powder or pepper. You're not supposed to eat these things. And so, like, people, this is like a challenge, right? I mean, the hot chicken genre, the space, is kind of fitted with these people trying too spicy of things. Now, some people can handle it no problem.

I mean, if you're from some ethnic regions that are used to those spices when you grow up, obviously you're going to be okay. But coming from Las Vegas where I've never even seen a ghost pepper or, I mean, let alone a habanero at some places, that's like insane to me, you know? So it's pretty, it's pretty dangerous. Do you ever turn anybody down at the restaurant? All the time. Really? This lady wanted her eight-year-old son. She signed a waiver for eight-year-old son.

I said, ma'am, listen. you can write me all the reviews you want, but you're not taking this, and you're not giving this to your kid. And that was that. And I happened to be there at that moment. I don't know, maybe she didn't like him.

I'm not sure. It's the only excuse I can think about. She just didn't understand. Maybe her son wanted it. She didn't get. I really have no idea. But like, if you just understand,

I mean, we literally label Scoval units, right? Like hot Cheetos, right? Are like 5,000 skullsul units. Really? I don't know. Those are hotter than Popeye's hot chick. They're so low.

Yeah. Well, it's, but when you eat Popeye's chicken, you have so much more to, you're eating, like, such a different way. Like, if you just take Popeye's chicken and cut it up and eat it, it's going to be way spicier than if you have it with bread and all the sauce, right? Because it drowns it out. So you have to look up Scoville units and do your research before you, like, go there and go crazy. That's fair. Maybe I'm just a skeptic because I've never really had anything that's, like, that hot. Like, I had the world's sourest candy.

Oh, we did that. That was still very tolerant. Oh, man. I can't even eat a warhead. Yeah, I think we still do. You know, yeah. I mean, you probably, you said you have the stomach. Yeah.

No, I'm not. I'm, I can't take that type of risk. Yeah. No, that's, that's fair. But even the world's sourst candy was not. Have you eaten that chip? The one chip. No, I'm not.

No. That's supposed to be crazy hot. Um, but it's different. It's like a, it's a very, it's a dark ghost pepper that they use. And it's a very hard ghost pepper. And I heard that there's scorpion pepper on it, too. Scorpion pepper is like very, very hard. Like different peppers do different things, right? I mean, you've eaten wasabi at a sushi restaurant, right? That's only spicy in your mouth and then like it kind of goes away, right? But there's peppers that don't go away. They like increase the more you digest it, right? And so that's kind of the one chip challenge where you eat it and you're like, okay, and then it like destroys you. It's like an explosion. And you can watch some of these people. I mean, I watch Shaq eat it. It's pretty funny. I'm sure for him the chip is like this big. It was like this big. It was like this big.

I've seen this video. It keeps getting recommended of Shaq. With the water bottle? Yeah. I see that. Normal people in. Yeah.

The water bottle looks like this and he's just holding it with his aunt. That's hilarious. Yeah. It's really interesting. It's very interesting. What,

uh, we're, influencer culture is building now. Right? I mean, think about all the things that we think are cool today. And so that's why Houston saw chicken works. You know,

if I open like a Thai restaurant, my might not do good. You know? Who knows? Yeah. Now, you turned down people at the restaurant occasionally for certain situations like that. What about the car rental business? Somebody walked in and you're just like, no, I could tell that this is.

I am the king of turn down to car rental. Yeah. Like the king. How do you do that in a way that they don't feel like? I have no feelings anymore. Really? I am, it doesn't matter. I used to be like, I would just make them jump through more hoops, get better insurance and do this and do that.

Now I'm just like, here's an address of a company that will rent to you that feels more comfortable with it. That's what I said. Yeah. And what sort of red flags do you look for in that? Today during the pandemic era, it's mostly younger kids, right? I don't know why, but we never really had like the 18 to 21 year olds. Yeah. We make it pretty mandatory to do 25.

But like you don't always know when they're not 25 until you like go through the whole process. you've rented them the car, then you get their ID. Like we don't get their ID and check their insurance first before they pay. Typically they pay online, they preserve it, and then we find, we see them. Then we see their ID. So it becomes a little bit more difficult to turn them away once you've already have a reservation, a month in advance, and all of those factors, right? We get their insurance about a week before they rent typically so we can kind of mitigate some

of that, but sometimes people don't send their insurance all same day. Something that on your website that says, like, you must be over 25 and, like, they certify. Yeah, they don't listen to that. That happens all the time. Yeah. So, let's say I walked into your place and I wanted to rent a car. Do you think I would be approved or denied? Jack's 23.

Well, he's 23. I already can tell you it's approved, right? Why? There's certain mannerisms that you can tell. Someone's responsible or not responsible, right? And, I mean, I can tell by your hairstyle that you're responsible. Like, I mean, it's. My hair is atrocious today.

Thank you. That's why, Jack. Pretty bad. Yeah. You're not impressing anybody. Yeah. I mean, there's just certain, I mean, how do you explain this without being offensive, right? You can't.

But like, you just learn how to read people and what they're feeling, right? Like their vibe, their aura, like all that stuff really plays into a factor. How calm they are, how they talk, right? If they come in with a group of, like, 10. guys and they want one car it's an automatic zero no for me that was what we uh it was lucky who helped us get uh for father's day we got a lambau and a Ferrari and we brought it back and uh that exact same situation it was like it must they almost have been 20 21 years old five of them all wanting to rent one car and it seemed as though they were each like throwing in like a little

bit each like a hundred bucks each and they're just going to share it that's a hard no for me yeah um Anybody that comes in with like any girls that come in that seem like they should be renting a car, a lot of guys with no insurance will send their girlfriends in and rent cars like straw renters. It happens every day. And it's typically like on holiday weekends, right? It doesn't happen like on a regular weekend where it's like families or the events are different. It's like Memorial Day or Super Bowl weekend where you get like a large crowd from like all over the world or all over the world or all. over the country and you can kind of tell like they're more they're nervous you know or they're they have like kind of like they're on the phone a lot there's a lot of those little red flags that you're

just like we can't rent to you you know because a lot of people it happened actually to another car rental company of mine is it's kind of a sad story yeah but a girl walked in rented the car and her uninsured unlicensed boyfriend was driving like over 150 miles an hour and hit someone else on a motorcycle and that motorcycle list died. No. And so those things typically happen. And I'm like a really big proponent of this. Like I'm in like the news and I'm working with the city to try to change this because

it's really dangerous. And there's really no regulation in this industry and a lot of people risk a lot of things. And so a lot of companies don't really go through and check their renters. Right. And they, uh, I do a pretty deep check. Like I have like a physical driver's license scanner. like a DMV record. Like it's pretty quick.

I mean, we have to pay seven bucks for it, but it helps us make those determinations, you know. So there was another accident that happened with a guy who had just got out of jail for a DUI. It was his third or second DUI. Wow. Three hours later,

he was, or not three or it was like a little bit later, a few hours later, he was driving like 140 miles an hour down Tropicana, lost control and had a guy on the sidewalk. Wow. For third DUI. Oh my gosh.

So those types of things. You've got to avoid. I've never Knock on Wood had any injury accidents since I've started. But I'm really picky because like there's always another customer that's responsible. I think four million people come to Vegas every month. If I only have 80 cars, it's pretty good odds. I'm gonna rent them every day, right? I mean, and if you have less

than 80 cars like let's say 10, 12, right? Most of the other competitors here town have like 10 to 12 cars. You're gonna rent them every day. You don't have to push the luck and just take the first dollar that comes in. Yeah. Right. And so that's kind of the big red flags. You got to be very careful. You were telling us, though, about like going to California and having to get like, go to go to court. What happened there? How common is that? So I had a woman rent a car and she came from the Cosmo. She refused. This is, unfortunately, while I was out of town and had a couple of new employees.

that were training. We had a retail store at the mall. So those employees trained at our main office, then went to the mall and sold rentals. Got it. So this one of my new girls was renting a car, didn't really learn the red flags yet, rented a car to a girl and took all the information over the phone

and went to the Cosmo to drop off Dodge Hellcat. And they did the contract there on the spot, took the pictures, did all the stuff. But we didn't get her in our, our office. And so that was a big issue. She paid to go to California and it's okay. Like sometimes international people will come from like the UK and they'll want to go to Disneyland. That happens like every time. I mean, if you come from the UK, Disneyland's a cool place. Yeah. So they fly into Vegas and then they drive the Disneyland and come back. So you take an SUV or a four-seater car. Yeah.

Right. So we have a fee for that and they go and they do it. They come back. So this girl paid. She rented the car for three days. And on the third. day she was due back at 2.30, like 1 o'clock, we tracked the car and it was still in California. So we sent her a message and she's like, oh, yeah, I'm so sorry. I'll extend it, charge my card. Well, her card got declined. So she's like, well, I'm on my way back right now. I'll just pay you guys cash. I can't put it in the account. Just an excuse after an excuse after an excuse. So like the fourth day happened and the car is still an exact same spot. It's right next to Dodger Stadium. Like it hasn't moved in, it hasn't actually moved in three

days. So on the second day she's in California, it was still there. So now it's the fifth day, and she doesn't answer us anymore. We call. We do this. We do that. So I said, okay, guys, I had a location in Orange County. I mailed the key there, and they went up to go get the car. Yeah. So they go to this guy's house or this house where the car is at. And the car's in the driveway, they just turn the car on. They back it out. They get in the street. And as this is happening, some older gentleman comes out, sort of screaming and yelling, where are you taking my son's car. And my renter's like, well, he rented it. He's like, no, he bought this car. And my, one of my employees is like, I'm sorry, you're just, we're confused. It's just a rental. He didn't bring it

back. We're going to take it now. He calls the police. And it turns out that the son was actually a police officer. And he purchased this car on offer up. He purchased my hellcat on offer up. Now, there's a little bit more to the story in my opinion, because why would a police officer give 30% less value the car was 30% less value on offer up how does that in cash yeah and think it's a legitimate transaction how did he he didn't get a title he did they made a title for this car so they had someone at the dmv make a title legitimate california title but the title number was wrong it was a it was a manufactured title number yeah and the v number was one digit off and then the year was also wrong.

So, like, the title wasn't, like, legit. And, like, if you check the title on the thing, it was wrong. Like, it was, the car was a 2017. Title said 16. It was really weird. Yeah. And, like, the title looked perfect, but you had to, like, look into it. So these police officers come and they're, like, going crazy.

They didn't know what to believe. And so I'm in Las Vegas at the time, and I'm like, why didn't I go to this one? You know, this was a huge video, right? We were filming the whole thing. And it turns out this woman. sold this car, this guy. I think that guy was in on it. Because I don't see who in the right mind pays 30% less in cash as an officer of the law for a car and doesn't drive it.

He, the act, the place where they said that they bought it. Yeah. It drove from there to his house, stayed there three days. If you buy a brand new Hellcat, aren't you going to every one of your moms and friends and everybody you know's house and showing off and doing burnout? What would be the point of just keeping it there, not driving it? It was at his house. I feel like he was, he was the one, in my opinion,

that created the title and hadn't sold it yet. That's where I'm at, because he was too calm about losing X amount of dollars and it was a large amount of money. Like, why would he be cool? Oh, I see he said he paid cash,

but okay. There was no record. Got it. And I'm like, okay, so I'm selling you. If I buy a brand new Lamborghini, I'm going to drive that thing every second of the day.

I'm going to go to work and back and here and there and the gas engine. I'm just going to go to the 7-11 just to get gas And I don't need it Could you ask for a bank statement or something It's just like I want to see that you get through that We like I mean

Why does the police officer have X amount of dollars in cash? I mean a hellcat's worth 60,000 You pretty much do the math Right 30% less of that is what the alleged amount was I mean it's a little fishy Sure So they impound this car Because I refused to report the car stolen

And the reason I refused to do that was because if I report the car stolen, I'm going to have to get my insurance involved. They're going to have to do an investigation. I'm going to have to file a claim, right? We go back to that insurance thing that I was talking about. And it's going to be a huge mess, and they're going to impound the car. And then it's going to say stolen recovery on Carfax, which is going to devalue the car even more.

And the people who rented it didn't have legitimate insurance, likely, right? Weren't a legitimate person, right? So we didn't find this out until after. but of course all of the documents they gave us were fake, right? And so all of these things happened and the police take our car. So they threatened me and say, if you don't report this stolen to protect our officer, that's what he said. We're going to impound it.

They took the car for three months. I didn't call me. They ghosted me every single day. I'd call them and call them and call him. And then after like three months, they were like, hey, we called you three months ago to pick up this car. Come get it. And they made the release stamp the day after they picked it up. Wow.

Just so that I had no right to sue the department for wrongful in everything and all that stuff. They were very calculated. It was a really weird situation. It was the weirdest thing that's ever happened in my company period. Wow. So. Why not just can't you self-insure? I want to.

It's a million dollars a year. I want to. Yeah. I mean, I think that's the necessary next step. Yeah. At $400,000 a year, maybe it wasn't the right thing.

But now it seems like the only logical thing to do. Yeah. You know, so I'm going to have to do that this year, I think. Or we just translate our business into something else, right? I mean, with YouTube, I thought about becoming a full-fledged car dealership. We're licensed to do that, right? I mean, if we just do rentals on the side, right, then maybe it's not that big of a deal, right? We don't have to have all of our eggs in one basket, you know?

If we just sell cars, rent them a little bit here and there and make the main focus something else, the insurance liability will go down dramatically, right? but self-insuring is probably the only answer. How has the appreciation of like the used car market affected you with such high inventory and just the overall cost of cars increasing lately? I mean, that's the best thing that's happened because I had all these cars, 50 plus cars before the appreciation happened. So like the entire year of 2020, most of 21, I didn't take any depreciation.

So what's your thought about the value of the? used car market. Is it getting too crazy right now? Just to put this into perspective. Yeah. I'll give you a real life example. My sister-in-law leased a 2000, whatever, 18 or 19 Chevy Equinox. And the lease came up in December of 2021. And like earlier in July, August, she wanted to trade it in and get a new car because

she was already over it, right? She took it to CarMax and her lease payoff was around $17,000. and they offered her $15,200 for the car. So she didn't have the money at the time to pay off the difference and trade it in. She didn't really want a negative equity. So she said, okay, I'll just wait until December, pay my payments, and then I'll turn the lease in, no problem. So November comes around.

This is only what three months ago. And I told her, just take it back to CarMax, see what they say. They reevaluated the same car with 1,000 more miles on it and five or six months older for $23,000. The card appreciated $8,000. The car brand new in 2019 was less money than $23,000. So a used car that is two and a half, three years old at this point is worth more than it was new in 2019. Trade in.

That means they're going to take the car for $23,000. They're going to spend about $1,000 reconditioning it. And they're going to list it for $2,900. That car was $22,500 new. And now it's $2,900 used with about 18,000 miles on it at the time. Does that seem logical? Yeah, I mean, it's crazy. But that's true for Tesla's.

It's true for any car. Yeah. So just think of this narrative. At what point does the ball drop? So my sister-in-law goes and buys a new call. right there's new inventory sitting all across the country waiting for these chips that we're all waiting for right the world's waiting for chips chip shortage is real there's hundreds of thousands of cars across the country sitting in storage lots and ports and here and there waiting to be sold

so the guy that buys the 2019 car for 29-9 plus sales tax plus fees is in the car for 34 000 What happens when the 2003 version comes out and the MSRP is still 22,500, right? Because eventually there's going to be enough of those cars, right, for us to be able to buy them at a normal price again because the dealer can't sell everything for $10,000 over sticker forever. Manufacturers are going to make $100,000 a month. There's not going to be enough people to trade in the $2,000. That they're upside down now consider the value is truly 15,250 only eight months earlier, right? Six months earlier. So he's in it for 34,000. He now legitimately bought this car for almost $20,000 more than it was truly worth six months before now when you take that on a scale of a car like a 4GT or a mercy log or some huge number and you add 10 12 20 percent absorption rate is easier, but if you take it and you say 110% markup on a used car, the ball's got to drop, right? Because that person that wants

a new car in 2024 cannot get any, how could they get out of that car? Yeah, they're upside down 100% in value, right? And that's if they have a three or four percent interest rate and they've paid it down some. Imagine if they have a 12, 15% interest rate. The car's going to cost them $50,000, right? So like the used car market is, going to destroy America's finances eventually. When is that going to happen? I mean, the chip shortage, like, we have to follow what's happening with COVID because COVID in America is a little bit less than COVID in other countries, right? Like, the Asian countries are a little more strict. European countries are a little more strict. So they're like blocking the manufacturing plants

from working, right? I mean, here, we kind of like go to work and do our daily thing. We wear a mask and, you know, we appreciate the news every night. But at the end of the day, like, Life's kind of normal in America. Yeah. Right. Like no one's scared to go to work, I think, at this point. But like in, you know, China, I heard and read that they have a lockdown where you're only allowed to leave every two days from your house to go shopping. So like if all those chips and all those things are coming from those regions, when does it end?

Right. I think this is going to probably persist through this year and probably the beginning of next year. But there's only so many people that can buy a new car. And when this value started to go crazy It was because so many people got out of lockdown And was like, I'm buying my dream car Or I'm spending all of my money, right? Like I don't want to sit here anymore.

So how do you determine when it ends probably ends like in a year? I mean, it can't go farther than that Because the dealerships have to sell cars, right? And the banks have to give loans And the salesmen have to sell cars And then they have to service them. So like there's a huge circle that we have to feed, you know?

So eventually, you're not going to be able to trade in your car and get a new one. Where do you invest your money? Right now, I'm investing in land. Land is the only thing that I can see putting my money into. They don't make more land. It's just, they have enough, right? In Vegas? Anywhere.

The land is just finite. So I do have land in the sandbox, which is great. There we go. Just in case metaverse land is worth way more than real land one day. I'll have one. I'm curious of it. We'll be. We'll see.

Yeah. I have a board ape. Okay. So I'm a partner with Steve Ayoki and a board ape, which is cool. Kind of gambling in the NFT market a little bit because I don't understand it. And things that I understand, I kind of want to participate because I feel like there's a lot way smarter people out there making the rules. But land cars I have probably 50% of my investments in because I know them very well, right? That's the one thing that I think I'm the best at.

Okay. But how about this? For the viewers watching, if you have one car that you could buy that you think is undervalued today, that you think five years from now is going to be worth more, what would that car be? Is there a price point that I can set at? Just give any, any car. Gosh, this is a tough one. The older, Accura NSX is undervalued.

That's like a sub-100,000 car, and I think those are going to be mid-150s. I think there's a 50% appreciation in that. The gated Gallardoes are like $125,000 right now. I think those are $250,000 cars, right?

Your car, Ford GT, 05,06 are like high threes, mid-force. Those are $600,000, cars for sure. Just like a Carrera GT is about the same number,

production numbers in that, and the CGTs went from $700 to $2 million overnight. In the big hypercars, the Konex-X CCX the one I took you into that's a five million dollar car and those they're very rare but they're between one and a half to two point five million so that's a double LFA I think reached its pinnacle I think the car is a million dollar car nothing more right there's so many unique

cars like the Merseilago that haven't sold LPs haven't sold at auction yet that we don't really know where they're going to go I bought a 2010 Merse Lago SV which is a hard there's less than 100 in America. There's no real finite number of that. I think that's a $1.5 million car because there's only like 30 or 40 of them. Right. And it was the final edition V12 that made the biggest impact. Yeah. I paid $750. Right. So for me to pay $750, I kind of feel like there's a minimum 50% appreciation in that car within 12 months. What about for Jack? Jack wants to impress a girl. Mazda miata. That's the next car. I think I want it so badly, but they're so expensive. They're like Probably 20 grand now, huh?

I was looking at Mazda's, I don't even know, maybe like two years ago because my friend bought one. $5,000, I bet. Yeah. No, they were like $3,500. Oh, my friend bought one for $600. And there was just one stuck lifter, $40 to fix it. And then it ran perfectly. Oh, wow.

What a cool car. Yeah. So I, for you, honestly, I know he can relate, Lotus Exige. I think that's expensive, man. No, no, no, they're 40 grand. $40,000. No, more now. There's a tad.

There's a few of them that are 60. 2010, 2012, they're a little bit more. But if you get a 2006, Lotus Xige, you're like low 40s. I think you're hard to find 50s now. I was looking. I was looking. If the right one came up, I would do it. It's the best car I've owned in my life.

When I was 22, I bought my first Lotus. I bought an 07 Exige S for $21,000 from CarMax. They had a little CarMax auction. And I bought that car. It was the greatest experience you could ever imagine. It's a Miata in every respect, but it looks like a super car. Well, it is a super car. I would say a Lotus Elise.

It's easier to drive. How much of those? You can take the top off. Right now about 40. Yeah. I've seen Lotus Elises. Like, I sold one for $16,000 one time. My gosh, yeah.

It was crazy. I feel like the Lotus is right now are artificially inflated a little bit. That's a very unique car. And it has a very young demographic that likes it. And so right now with crypto, the young kids have a lot of money. So there's a lot more inflation in that car. But those cars typically sit at the 30 to 40 range. And that's like the best deal.

I don't know if that's good for no. No, I mean, if I'm gonna spend 30 to 40, I'll buy a Tesla. Yeah, because you know what? I saw that. I saw that. The corners of your mouth flickered down. I just, I don't know. Like, I can't get behind this.

I have a plaid. I mean, so my wife drives. She traded her Uris for a plaid. She's, she's crazy. to me. I just can't relate to her. I don't know why. The reason why I am now very gung-ho on getting an electric cars because I was reconciling all of my accounts for like last year. Figured out how much I spent in gas alone.

$4,600. Yeah, but imagine how much you're spending in electricity. I don't think it's going to be that big difference. Now that supercharging is costing people money. Yeah, true. I don't think there's that bunch of a difference anymore. Oh, gosh, supercharging is expensive. It's like $10 and $12.

But yeah. Yeah, but gas is like $7. Yeah, imagine you're spending 60% on electricity versus 100% of gas. Sure, all right. It's not that much less. I can't get my head around driving an electric car as my only car, right? Like, I could have, I wish that, like, Rolls Royces and, like, really nice sedans were electric because they'd be way better, right? But, like, as my only car, you end up with no soul.

I mean, you just, if you're a car guy, that's a real problem. Yeah. You could beat every car. It's super fast. But, I mean, at the end of the day, like, it doesn't give you that emotion. And that's the issue I have with these electric cars. The Porsche take on turbo S. I owned one for a very short time.

It got someone T-Bone me, unfortunately, and I didn't replace it with another one. But that car had some weird futuristic sounds it would make. And it really tried to put a Porsche back into an electric car. And I think they did the best job. at it so the model three it's like 60 grand right 70 grand model three is now it used to be 35 but now it's like 47 or something yeah that's going up so much you could buy a new one for less but you have to wait about a year yeah they're so backed up or you could buy a used one and pay a grand oh it jumped like 30 percent 25 percent it's see I've never driven in model three

yeah and that that short wheelbase maybe a little bit more sporty and it maybe have a little bit more umph, I guess. I have a brand new plaid, like the 22 or whatever, and I can't handle the yoke wheel. I think it's terrible. I just ordered a regular wheel and I'm putting it on there myself, but it's too fast. And I think that's like a scary thing. Like when you really push that car, it makes you sick. Like it's too fast. I love it. Do you have a, what's Tesla do you have? Model three. Oh, okay. Yeah. I mean, do you like it? I do. I love it. I mean, what's good about it? Everything. Like, but what? Self driving is incredible.

Okay, sure. I love the quietness of the interior. I love the big iPad in front. It's smooth. It's smooth. It's quick. It's, you know, you press the accelerator. It goes instantly.

It's quiet. I love the car. The storage in the car, too, is incredible. Yeah. I mean, you say all valid points. Yeah. I can't disagree with those things. I just, I don't know.

I just can't be effective. man yet. Got it. So you vouch for the lotus, because Graham has a lotus that I actually wanted to buy off of Graham. I'm not going to sell it. Best car ever. No,

you're not going to sell it. It's a lotus avora. Oh, you have a vora? Avoras are great. Avoras are V6, right? So they're like a little bit, they don't, they sound cool,

but I like the four sounder sound. It sounded nice. It was more analog. The avora is a good car. I mean, I don't know. How much are Avora is now? 60, 70.

He doesn't drive it, though. He's got the 4GT. I feel like Graham walks everywhere, apparently. He hasn't driving a 4GD. He has a 2006. He sits in his house all day. I drive that the most often. He drives all the time. It's my favorite car. Graham, we're like almost sell Jack the Lotus and then Jack can sell me his Lexus. No, I'm never going to sell. I'm not going to sell a lotus. I feel like Graham and I like could

go to a boxing match and all we had to do was like talk cars that we drive and it would make me so mad I would be like okay with it. It's like people people say I have a punchable face. It's just so funny. I mean, you have cars that people dream to even sit in. I'm a collector. I've not seen him drive the Lotus once. I have Pokemon cards that I used to use, right? I mean, I'm down to, like, throw down and play the Pokemon cards at this point.

You know, I mean, I haven't done it since I was 12 or 13. I still have all those cards. But, like, I feel like we shouldn't lock them in a box somewhere and just sit them. It's a work of art. You look at it. Put it there. I disagree. How often do you go look at your uncut sheet of Pokemon cards?

Every time I go to the past. Glance or do you sit there and appreciate it? It's the same thing. Look at this thing for it. I see it every time I go to the bathroom. I see it on the wall. What am I supposed to do? Cut it up and play the game?

Yeah. No, no. I'm just saying, no. Oh, yeah, yeah, let's take some scissors to that. I don't know. I like the perspective of like you utilize the things that you have. I think there's a balance. You don't board stuff.

Right? I think there's a balance. You know, I don't know, there's no right answer to this because everybody has a different value of what they spend their money on, right? I mean, I could spend unbelievable amounts of money on guns. I love guns, right? But I'd never use them. I never use my guns, right?

I just love collecting guns. I don't really think I should go use my guns, right? I think that's kind of like a weird thing. I mean, shooting range every once in a while, go practice. But you can only take one or two or three. I have like 400 guns, you know, so I can relate to collecting because it looks really cool. I'm at this huge room, it's all guns, right? the intruders away.

Yeah, I guess. But they're literally not like, they're specialty things. Like some are gold and they're all crazy colors and it's good. I don't really want to go out and just shoot in my backyard all day, right? But like with the cars, you can kind of like drive them in your normal daily routine, right? I can't just take a gun with me to work, right? I mean, I guess I could legally, but it's not really fitting. But like with I could drive my Lexus LFA to work and I can have a great drive on the freeway,

13 minutes of bliss, seven miles on the freeway and just go and have great time. You know, I think there's a balance of that, right? Collecting and then using. But at some point, you're going to have to realize we spent money on this and like it wasn't worth it. Money sitting in the bank probably isn't that fun either, right? I mean, can we agree? It's pretty fun. You know, I mean, if we just have it in the bank, we're just losing money to inflation, aren't we?

Yeah. There's, yes, but there is also the opportunity of, you know, if a good deal comes up that you're able to jump on it. Yeah, I think that's Graham's trigger. I think wasting money is Graham's trigger. Yeah, yes, for sure. I like just looking, appreciating, and that's it. Jack, let me give you the only sensible advice in this room. Let's hear. Don't buy another car. That's, there you go. These, these guys right here, they're out of their mind for telling you to buy a car. That's all I'm going to say. Just keep your Lexus, man. I'm not wasteful. I'm very, I waste my money a little bit, but it's on very, it's a, it's a, it's a, Like small relative to what is your vice what I could be food like okay I get I go out for food a lot like That's good britos tacos Amazing burgers You're talking my language Yeah so you're talking my language yeah but it's not like it's a lot of money right so I know that on occasion I can splurge if I if I so please

So I do want to get another car at some point and I think you should buy a very exciting car to use To go on all of the food adventures And it adds to that experience So every time you go to some new food place, drive your really cool car. Mazda Miata would make it. Top down, it's 60 degrees outside or 50 degrees heater on, windows up. Oh gosh. Place some, I don't know.

Crazy train. Yeah, something awesome. There you go. Yeah. Place something nice and just jam on the freeway and get a good burger. That'll be the greatest experience that you can get. I agree. I mean, that's pretty much what we live.

for is those moments. And you have long hair. It'll be like flowing. Oh, I'm going to grow it out if I get a me on it. It'll just be like all over the place. Yeah. I think, I think that's enough, Jack.

All right. Is there anything else that you want to throw in? That's a great thing to end this video on. That emotional visual moment. Thank you so much for coming on Houston. I really appreciate it. For opening up my third eye. I appreciate it.

Thanks, Graham. Yeah. And thank you guys for watching. Make sure, by the way, we'll link to your channel down below in the description. Make sure to like the video and get your free restock down below in the description. You may as well.

It's worth all the way up to it. Thank you guys. I really appreciate it and subscribe. Thanks for coming on. That was awesome, man. Nice meeting you too.