#137: Raising Capital for Multi-Family Syndications – Part 2

Welcome to The Accelerated Investor Podcast with Josh Cantwell, if you love entrepreneurship and investing in real estate then you are in the right place. Josh is the CEO of Freeland Ventures Real Estate Private Equity and has personally invested in well over 500 properties all across the country. He’s also made hundreds of private lender loans and owns over 1,000 units of apartments. Josh is an expert at raising private money for deals and he prides himself on never having had a boss in his entire adult life. Josh and his team also mentor investors and entrepreneurs from all over the world. He doesn’t dream about doing deals, he actually does them and so do his listeners and students. Now sit back, listen, learn, and accelerate your business, your life, and your investing with The Accelerated Investor Podcast.

Josh:So hey, guys, it’s Josh, welcome back to Accelerated Investor. In this interview today, I am spending some more time with Adam Adams, also known as Triple A. If you caught our interview released a few days ago, this is part two. Adam owns over 1400 units of apartments. He is a general partner in over seven syndications, as well as a passive investor in deals. He hosted a bet called the Raising Money Summit and has over a thousand attendees. In this second part of the interview, I think you’re really going to enjoy it.

Josh: I asked Adam specific questions about how he got started in real estate with tax deeds and even a property that he lost to foreclosure. You’ll also hear about Adam’s advice that he would give his younger former self and some personal hacks that he gives away for being a more involved father and for having better health and how that’s allowed him to be a bigger, better entrepreneur. So I hope you enjoy part number two of my interview with Adam Adams.

Josh: So, Adam, with all your successes and following, everybody starts somewhere, you know, you’ve got to kind of back up. And so I’m interested to hear what your background-background is. OK. You know, education wise or jobs before real estate and then those first kind of year of transition of your first deal or jumping in full time. Do you have like the “I hate my job” story and able to jump into real estate? Or a lot of people have a great job and then tinker with real estate on side. And what was that first, you know, kind of transition like for you that first year?

Adam:So the first year was 2005 for me. I grew up in a family who…

Josh: I can’t believe this is the first time we’re meeting. That was the same time I got started. Fifteen years later.

Adam: I was small fry back then. I was small fry. My stepdad, the guy who I call dad because he raised me. And what an amazing guy. My mom started dating him when I was five years old. They got married when I was eight and they actually knew each other in elementary, junior high and high school. And my mom had a crush on him forever. And I can see why. He’s a great guy and also very handsome. I wish I had his genes. But the point is that he was a real estate investor. He was an entrepreneur. He owned land. He owned multifamily. Eventually, while we were growing up, he bought a self-storage unit. When I turned 16, I used to snowplow the self-storage unit with a little four-wheeler. A little tiny ATV. I grew up in a in a family that that was kind of a normal thing to do. And I remember my stepdad used to say, Adam, you’ve got to save 10 percent. You’ve got to invest 10 percent. You’ve got to give away 10 percent.

Adam: And I was like, Dad, you’re giving me a dollar an hour. What am I going to do after I do all those things? Buy a hamburger? Buy a hotdog? Buy a candy bar? And so I remember just thinking my dad, like, he obviously knows what he’s doing, but I’ll do that eventually, like when I’m old and boring like he is. And all of a sudden out of nowhere, he bought me a piece of land. And he bought it when I was in college because I just I hadn’t listened to him yet. Like, what was I going to do in high school anyways? But he bought me a piece of land and then is his CPA said you can’t give that to your son. He has to buy it. And so my dad, Indian-gave that thing and said, you’re going to have to pay at least 100 bucks for it. And I’m like, Dad, I’m in college.  How am I supposed to pay for this? I can’t get hundred bucks.

Adam: That’s like a whole day’s salary at my bartending job. Right. So anyway, I ended up going ahead and finding a way to pay him. And I finally owned a piece of America. I thought it was kind of cool. I owned a little cabin lot out in three hours away in the middle of nowhere Utah. And I remember just thinking it was kind of cool until I got the tax bill and then I was like, Dad, do I have to pay this? He goes, of course, like, are you an idiot? Like, you have got to pay your taxes. But I didn’t do anything with it. I haven’t even seen it this whole year. My dad’s like, you’ve got to pay them. So I paid the real estate taxes and then someone offered me money for it. So this is what really got me into real estate.

Adam: 2007, I sold that thing for a 12000 percent return on my money. And I remember just being like, holy cow, this amount of money is more than I’ve ever made in a year bartending. And I’m like, I think I just got to do real estate. So I was going to school as a music educator. I play the tuba and some older instruments. I write music. And I thought all I want to do is teach. But I made more money on that transaction that I was going to make my first year of teaching. And I just thought to myself, Huh.

Adam: I don’t think I’m gonna be a teacher. I finally read the book Rich Dad Poor Dad in 2007. I learned that Robert Kiyosaki didn’t do single family. Most people have no idea. They assume. He says, real estate. They imagine it’s single family. But he was doing multi-family. He was doing syndications. He was investing in his money. In in. What’s his name? Nick. I don’t remember his name right now, but he’s a famous guy. He owns Malcaroyd Kenny, Malcaroyd. Right. Anyway, he invested with him and made a bunch of money. And I was like, I’m doing that. So how do I do that?

Adam:So what I decided in 2007, as I said, I needed to learn how to do property management. So I managed three properties, 23 total doors. An 18 plex fourplex and a condo for this one guy named Reid Quinn. And then in 2008, I bought my first property that I already told you earlier, I ended up losing in 2011 because there was aftermath from the 2008 crash. In 2015, I started doing tax deeds and we started doing awesome. 2016, I bought a bunch of rentals and 2017 I started syndicating, so that’s kind of my journey.

Josh: And during that time, what do you think’s been the biggest obstacle that you’ve had to overcome? You know, maybe losing that building in 2011? Maybe it’s your first syndication? Maybe it’s believing that you’re worthy of having a following? That sometimes fight out. I think a lot of people who have a leadership role or take a step up to become more of a mentor. And you had a certain amount of success there’s that doubt that creeps in at the beginning, when you’re like, are people really going to listen to me? Am I worthy of being listened to? So that was something that I thought long ago. Also, how about you, what you think was your biggest challenge on this journey of yours?

Adam: The biggest challenge was getting my mind around all that it takes to raise millions of dollars from other people. My biggest challenge was the doubt that I had. You know, did we did it? Did we do enough education? Did we spend enough time researching? Do we have the right people on our team? Like, it’s like this is a big thing. Taking all this money in. And I remember before raising millions of dollars. I remember thinking like that. Who’s going to put their money with me? And if they do, am I going to be able to save and protect it? So it was just a mindset game all around having other people’s money in my deals. And I think that a lot of people listening will probably resonate with that, too.

Josh: How do you think you overcame it? Was it the numbers? Was it looking at deals where job growth was two percent? Population growth was one percent. Did the numbers give you confidence or was it the deal? Somebody smack you upside the head and that you could do this? That was the challenge, but how do you think you got through it?

Adam: There’s probably three major things that helped. The first one was my team. The first one was just making sure that I had people on my team that were all smarter than me. And so other people that can underwrite somebody who has an engineering degree, loves numbers, loves playing the role of devil’s advocate. Like you say, Adam, you say this is a great deal. Look at this and this and this and this. I can point out all of the bad things. So that was really helpful for me. But if I could get something to pass this engineer, then I knew it was good.

Adam: So that was the first major thing. The next major thing was something that not everybody who’s listening can do, unfortunately. And even the ones that can might just feel like they shouldn’t. They might just feel like they listened to a Bigger Pockets podcast. And it said you shouldn’t do this. But I will say for sure it was us having a mentor. Now, I’m not even saying that we’re paying for education because I can get a book for 20 bucks anywhere. I can listen to podcasts about multifamily anywhere. It’s not about paying for education. It’s more about paying for that person to hold your hand, who’s been there, who’s done that, who’s seen the problems? And when they are on your team, coaching you, mentoring you, they can kind of show you the ropes of what you may have missed. A book can’t do that.

Adam:So I would say the next big thing is hiring a mentor. And it was a big deal for me because I had just spent forty thousand dollars on a mentor. That I didn’t have. Forty thousand dollars that I didn’t have on a mentor for doing tax deeds. And now I’m in this thing where I’m like, I’m going to syndicate. And we hired somebody else for another 40 thousand dollars. Now, I’m not saying it’s going to be 40 for your listener. It might be 10 or 15 or 20 or 25 or 150. I’ve seen that one hundred and fifty too, But regardless, you gotta pay for somebody who can really be there on your side. That mentor was something that not only helped us be safe, but it helped us feel confident when we were putting passive investor money into a deal. So those are two major ones I think we should mention.

Josh: Fantastic. And now that you’ve been through this journey, you know, and you’re to the point where which I don’t know if our listeners will catch this, so I’m going to point this out. Where you’re like we talked about, you’re observing COVID, basically pencils down, we’re not going to buy any deals. We’re working on this Raising Money Summit. A thousand people coming, but it doesn’t seem like you’re feeling a lot of pressure to do a deal right now because you have a cash flow coming in from your assets. And I think that’s the thing that’s happening actually behind the scenes that many people are maybe not grasping is that seeds that you planted, trees that you’ve grown, the apartments that you bought, syndications you’ve done, have allowed you now to not feel pressure?

Josh: I’ve got to flip my next property. I gotta flip my next house. I gotta buy something. I need an acquisition fee to pay the bills. That to me is maybe the biggest takeaway that I’m getting from this interview with you is your capacity to be able to say, no, I’m good with pencils down. I have the cash flow. You’re certainly still growing. That’s what you want to do. You’re young. You want to grow for a long time, but you’ve earned yourself the right to basically take a breath and say that it’s proper now to just have pencils. Now let’s see what happens. And so along that journey, if you were to go back and talk to that 2005-self or the 2011-self, what are a couple pieces of advice you would give to yourself and our audience about your journey that’s really resonated with you, things that you maybe would do differently?

Adam: 2005, if I could have said anything to myself at that time, it’s what I learned in 2007. And that was that my piece of land wasn’t technically an asset. It didn’t pay me. All of a sudden, I got a tax bill and I’m like WTF. I didn’t have enough money to pay for the property. Now I had to pay taxes?! And you know what the answer of that is, right? Real estate means royal estate. It doesn’t mean tangible estate. It means royal estate, which basically means that it comes from this history of that the government owns the property.

Adam: You pay rent to the government, which AKA is property taxes, because nothing technically is ours. They can take it no matter what. You don’t pay your taxes? They own it automatic, free and clear. They don’t have to do anything. And by the way, they don’t have a mortgage anymore because it’s the royal estate. But regardless, I would have told my 2005-self, Adam, you need to start getting cash flow as soon as possible.

Adam: It’s more about cash flow than it is about just placing your money somewhere. Right. And then the 2011-self. What I would have probably said is don’t put your tail between your legs for four years. Like, I get it. This hurt. It was embarrassing. You’ll never want to tell anybody that you lost this property. But like, the last thing that you needed, I told myself, A, I have kids now and I’ve got to be responsible. I can’t ever have let that happen to me again. If I could just go to my 2011-self when I lost that first multi-family, if I could just go back in time, I watched Back to the Future recently. I could just go back in time and give myself that almanac, I would just be like, dude, just get right back on the horse. Like there is no reason to take any type of time away from this. The only when you fall, you fall forward, Adam. I wish I could have said that. 

Josh: Adam, you’ve had a lot of success. You have a team, joint venture partners, you know, a bunch of buildings, you’ve done a lot of things right. It takes a lot. On a day to day basis to be sort of an elite entrepreneur, an elite performer. And I’m not talking about really what you do with work. What I’m talking about is what you do outside of work that allows you to be a great entrepreneur, have a balanced life, be a great father, be a good partner or a spouse to someone. So what are some things that you do? Maybe the way you manage your times and kind of personal habits, maybe what you eat that allows you to feel energy and clarity and focus and be able to be a high performer both in your personal life. In your business life.

Adam: Yeah, good. I wish there was just one. I wish there it was just so easy to sum it up to one. Maybe the easiest way to add value to the listener right now is to say that during the period that I looked at work as being my main thing, income was my main thing. Growing my business or my influence was the main thing I cared about. When I did that, I got fat and I got angry at my kids. I remember resenting the kids being like, man, if I just didn’t have kids, I could be so much more successful. And so when you put at the top of your pedestal money, it kind of hurt me. And so I changed that only about two years ago.

Adam: Only about two years ago, where I finally said, you know what? All I care about is a strong relationship with my family. And a secondary thing is my health. If I got those, I have a great life. And then I tried to fill in the work around it. And what I found that I did is I built a better team. I became a better boss. I became a better dad, a better partner. More healthy. I lost 30 pounds. And so it was like once I understood that my family and my health were the top, most important things, I was able to put everything else into perspective.

Adam: Drink less alcohol at night. I remember I used to have like six beers, which to some that’s nothing. And to others you’re like six beers! Are you kidding me? It was like water.

Josh: When everyone was home, I definitely was drinking more. And then to that point, like, my wife and I went to Florida for a month in the whole month of June, we were gone. Came back and I really have drunk almost nothing for the last three weeks or four weeks. Yeah. And I’m like, you know what? This just isn’t me. This isn’t really how I operate. Like, we had so much downtime because of COVID and like didn’t have to really get up very early the next day. Kids were home. We were all home. No one was going anywhere.

Josh: And it just didn’t feel like me, you know? I guess I’m just agreeing with you that that part of my life has a place. It’s fun. Great friends who like to party. But to be doing like even a couple beers at night. I wake up the next day. I just don’t feel as sharp. I don’t feel as focused. And it’s honestly, it’s the choice of when I reach in the fridge, am I reaching for like a water or a bottom in water or a green shake? Or am I reaching for a Miller Lite. And that will determine part of how my next day goes. Probably very similar for you.

Adam: I read the book Compound Effect, which really started this for me. I was reading the book Compound Effect about two years ago, and I was in this mastermind. And just to paint the picture. Adam Before: I was working about fifteen hours per day, probably six days a week. And then the seventh day I was just getting out with my kids. It was still important. I got to play with them. I’ve got to do something fun. Go to the amusement park, whatever. But it was like six days a week. Working probably seventy-five hours a week or so. And it was like by the time I got done, I put the kids to bed and then I would just crack open a beer, have the second, have the third.

Adam: And that was just like I needed that release because like today was so hard. But then you wake up, you don’t feel like you don’t feel happy or healthy. You don’t go and exercise. You just get up, get the kids out to school and you just run to the office all day again. And that was just a horrible cycle for me. And then when I finally changed that, it became like it was all about family and then health. And then I just kind of, even though I still work a lot, maybe I’m working 10 hour days or six hour days, I still work a lot more than some of the people listening want to end up working. But I think that it’s good to say if you really want to grow, you’ve got to put in the work. Right. But I feel happy, healthy, energetic. I’m kind to my kids nine out of ten times instead of one out of ten times.

Adam: And I think that’s really important. And so one of the big things that I did is I started practicing gratitude. In the morning and at night, in any time I was stressed in the morning, I did it. I still do. At night I did it. And then any time that I just felt super overwhelmed. Instead of saying, man, I got to do this, I got to do this, I got to do this. And you’re just, like, stressing yourself out more, giving yourself hives or whatever. What I did instead is I just took a step back and said, look, I have this, I have this. I have that. This is going right. This is going right. And that allowed me to see the positive and to understand that, like, if I don’t make a million dollars overnight, it’ll be OK because I have an amazing family and my health all intact. And I got 20 years to go. So I think that was a big part of it is just tweaking my mindset and adding in gratitude.

Josh: Yeah. Fantastic. Adam, love Listen for my audience. I absolutely will push all of you to connect with Adam. Check out his events. Check out his business. RealBlueSpruce.com. Also RealBlueSpruce.com/podcast. Adam was gracious to interview me about two months ago. And we just, you know, just kind of growing this new relationship with Adam is really exciting. And I love your content on social media. Connect with Adam on Facebook and any other kind of parting shots, words of advice for places that people can connect with you.

Adam: Yeah. There is. In fact, I was talking to my business partner this morning and I said I let him know that I was going to come on your show. And he goes, hey, let’s give him a discount. So the Raising Money Summit. Yeah. If the Raising Money Summit is typically 400 bucks for a virtual ticket or I think it’s double that for a VIP. But we’ve done something incredibly special. So if they text AI to, oh, my gosh. One second. I need to find my notepad again. I think it’s. Oh, my goodness. Why would I do this right on the spot? To 55444. Double five, triple four. AI. They get a massive discount only because they follow your podcast.

Josh: Fantastic. And listen, it’s been an absolute blast having you on the Accelerated Investor podcast. Thanks for being here. Thank you.

Josh: So, hey, I hope you really enjoyed that interview with Adam Adams. Had a blast interviewing him. He and I started around the same time 2005, and have done a lot of amazing things. He’s got a huge audience. So if you’ve joined this podcast, make sure you leave us a rating and a review at iTunes. Leave us five stars, if you could. And a rating or a question. Appreciate that. Don’t forget about our free T-shirt contest. If you leave us reading in a review and let us know. Take a screenshot of that rating and review. Send it to our customer service department. We’ll put the link inside the description and send it to us. Post that on Facebook, post it on Instagram, post it on LinkedIn. And so we can see it.

Josh: And we will send you a free Accelerated Investor T-shirt and some additional goodies from my office as a way to say thank you. Also, don’t forget to join our free Facebook group on Facebook. It’s called, as you would guess, Accelerated Investor. It’s absolutely free. I answer questions in there on an almost daily basis. We do Facebook lives inside of that group. It’s a very engaged community and it’s absolutely free. Don’t forget to check it out on Facebook. Accelerated Investor, join the group for free today.

Hey, Josh here. And do you want to win a free Accelerated Investor T-shirt? All you have to do is give Accelerated Investor our podcasta rating and a review on iTunes. OK. Do that now then send us a screenshot on Facebook, Instagram or Twitter. What we’re going to do then is every week we’re gonna pick our favorite rating in review and we’re going to send that person a free T-shirt and maybe again, some other cool fun stuff as well from Accelerated Investor. So, again, don’t forget to take a screenshot, leave a rating review, take a screenshot, send it to us so we know exactly who you are. And then once a week, every week on the podcast, we will announce a new winner. Don’t forget to take a screenshot and send it to us so we know exactly who you are. We’ll announce a new winner every week.

You’ve been listening to Josh Cantwell and the Accelerated Investor Podcast. Leave a comment on our iTunes channel and let us know what you want to learn next, or who you’d like Josh to interview. While you’re there, give us some five-star rating and make sure to subscribe so you can be the first to hear new episodes. Follow Josh Cantwell and his companies, the Strategic Real Estate Coach and Freeland Ventures on all social media platforms now and stay up to date on new training and investment opportunities to start your journey toward the lifestyle you’ve always dreamed of. Apply for coaching at JoshCantwellCoaching.com.

Making that jump into raising huge amounts of money for multi-family deals was scary for Adam Adams of Real Blue Spruce. As a real estate investor, he’d been burned before in big deals, and he didn’t want to make that mistake again.

Some of the biggest fears that Adam had about raising capital were questions like: Am I going to be able to save and protect this money? Who’s going to even want to invest with me? Do I have enough education? Do we have the right people on our team? Did we do enough research?

But there were two major things that pushed him through this mental block: smart people on his team, and paying for a mentor to guide him through the tricky parts. Having these two things in place have also helped him make it through the “pencils down” phase of COVID. He can afford to take a deep breath because he’s prepared his portfolio to handle all of this.

If you’re ready to network with other high-level real estate entrepreneurs, then you definitely want to get involved with Adam’s Raising Money Summit 2020. My listeners can receive a discount on their tickets by texting AI (as in Artificial Intelligence) to 55444.

Jump into our Facebook group to engage with me or my team on a daily basis. And remember to leave us a review in a chance to win an Accelerated Investor t-shirt.

What’s Inside:

  • What the “pencils down” stage is and how it’s helping Adam get through COVID.
  • Adam’s advice to his 2005-self and his 2011-self.
  • Why Adam decided to focus on his health and his family.
  • How you can get discounted tickets to the virtual Raising Money Summit.

Mentioned in this episode​

Leave a Reply

Your email address will not be published. Required fields are marked *

WordPress Video Lightbox