Michael Fitzgerald Shares How He Went From Bandit Signs to 100s of Doors and Running a Fund

Steve Trang: Today, we have Michael Fitzgerald with Gideon Properties. Mike flew in from Maryland to share how he went from a one bedroom apartment to doing his million dollar farm deal with no money out of pocket to owning hundreds of doors and running the dream fund. If this is your first time tuning in, I'm Steve Trang, founder of the OfferFast Homes app, the only MLS for off market wholesale properties, and I'm on a mission to create 100 millionaires. One question I get a lot is how do I become one of the 100 millionaires? And please allow me to answer it here.

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That way we can all grow together. And this is a live show, so please ask your questions for Mike to answer. You ready?

Michael Fitzgerald: I'm ready.

Steve: Alright. So first question is what got you into real estate?

Michael: So I was driving down, on Route 40 in Maryland, and I called a rent to own ad in the newspaper. I had about 10,000 saved up. And the guy on another line, his name was Dave, and he said I sounded like I'd make a much better real estate investor when running down his house and told me about the real estate associations in DC and Baltimore and said I could buy property, no money down. So, of course, you know, I was voted most gullible my senior of high school. So, of course, I believed I could buy property, no money down, and it worked.

Yeah. So I started going to real estate associations about two months in. I had my first deal, 13706 Mercersburg Road, Clear Spring, Maryland. I bought it with a division of proceeds, no money out of pocket, where I could make x and the homeowner could make everything over over x. So we agreed to a price, and I was allowed to, make profit on everything over that price.

Left my job two weeks before the property settled and never looked back.

Steve: That was your first deal. How long? So you call the rent to own sign. What prompted you to call the rent to own sign?

Michael: So the rent to own wasn't my first deal, but on the rent to own, you know, I I knew I wanted to create wealth, and I just didn't know how. What was there? So I said if I if I own it why I figured if I owned a piece of real estate, I I create wealth. So I had to own something. You know, I was 20 years old in the apartment.

I I had to own something, so I saw this rent to own sign. I called the guy, and he said, look. You know, I don't think my rent to own is the right type of deal for you, but I I think you sound like you'd make a much better investor than running down my house. I started going to Baltimore Real Estate Investors Association, the Washington DC Area Associations, Traction Ria, so on.

Steve: But was there a book or something that you read that compelled you, like, rent to own, or it was just real estate? I just know real estate will make me wealthy.

Michael: I I wanted to, I wanted to make money. So So right before that, how I saved up to 10,000 is I negotiated a deal over the Internet with the company in China for 3,000 little little mini motorcycles then said that I wanted a sample order at the same price of 30. Used all my $500 credit cards, everything. Sold them in a month by, word-of-mouth. I I I I used to roll them through, the the local mall with my name on a piece of paper.

I got kicked out of there three or four times when I sold them in a month. Had between ten to fifteen thousand, called a rent to own ad, thought I would be a big importer, found real estate, and never looked back. You know, real estate, has been really good to me.

Steve: So what so you went to the Rios, you went to and you bought it you bought, you know, that property. How long from your very first Ria to actually doing a deal? About two months. Okay. So not terribly long.

Michael: No. But I took a lot of action. You know, I first, I bought a couple $100 in bandit signs. Then I called everybody on Craigslist, and I I just took a lot of action. And, you know, I I probably had the same thoughts everybody else has.

Is this gonna work? Should I keep pursuing it? But I stuck with it. I took massive amounts of action, and it worked.

Steve: Got it. Okay. So all of this, you said that you're 20 you're 20 years old. So this it sound like you were in college? No.

Okay. So what were you doing? I know you you did that that that the toys with China. What were you doing for money before then?

Michael: I was in I went in the military a week after I graduate graduated high school. I went to senior week. I left two days later. I mean, what what a surprise. And, I was in the eighteenth airborne corps down at Fort Bragg, jumping out of planes with first of the three two first heavy artillery.

I I only had a three year enlistment, and then I was 20 years old still when when my enlistment ended. And within a a week or two, I I talked my way into a job I was supposed to have a two year degree for, left the job four or five months later, still 20 at the time, and and, jumped into real estate.

Steve: Alright. So then you do your first deal all from your one bedroom apartment.

Michael: All from my one bedroom apartment. I actually did 15 of my first 17 houses

Steve: Mhmm.

Michael: And about 13 of them no money down creatively from a one bedroom apartment.

Steve: Yeah. So because there's two things I wanna emphasize here because, you know, we're we're doing our free wholesale on the course. We get a lot of questions. And the two of the questions that seem to come

Michael: up a lot is, how do I get started and how much money do I need? And you you don't need any money. Any money. You know what? Even the million dollar deal you're talking about, when I got that, I had, like, 24,000 in the bank.

A farmer calls me up, says, hey. I want a million dollars for my farm. I'm like, sure. I can help you.

Steve: Yeah.

Michael: Then I I I ended up working it out for around 600, where I could subdivide the property, pay so much a month for his living expenses, then sell any or all the subdivision towards my purchase price. Literally did the whole deal no money down at some point.

Steve: Financed the

Michael: whole thing? He financed the whole thing. And at the end of the day, I created over a million dollars in equity. Now that being said, I thought it would take me three months. It took about fifteen.

The county denied me for no apparent reason other than I had a baby face and looked 10 years old because we went to the zoning appeals board. I'll never forget it. The surveyor, Fred at the time, I had a surveyor and attorney. When when I started the deal, I had 20 something thousand in the bank. By the time I got done the deal, I had over 50,000 in it.

It was money I made along the way on other real estate deals, paying the guy's living expenses, paying for the surveyor. The surveyor stands in front of his own commission. He he explains four of the exact situation. And at the end of each one, he's like, so I took an aspirin that day at work. So why when I take the same aspirin for mister Fitzgerald's situation?

Is he not allowed the subdivision? And I I got it unanimously, netted 1,100,000.0 in equity from a one bedroom apartment. Yeah. And then I I did. I I learned one of the biggest lessons in my life, Steve

Steve: Which is?

Michael: Because I didn't sell it. I held on to it. Mhmm. And I just thought the equity would keep going up. And then, the recession happened, you know, right before o seven, and, you know, luckily, I I had the farm.

I ended up, I ended up selling it for much less and, and moving to the farmhouse, and that's how I you know, I had multiple rehabs going all the time. My my original investor, told me, Mike, you know, you you gotta cut everything out like a cancer. I I leveraged the farm, moved into it, paid all my investors off, paid all my losses, and moved forward. I started out after a recession about negative 200,000 equity, never filed bankruptcy, never modified anything. In fact, the farmhouse multiple times, I tried to get a refinance.

Steve: Mhmm.

Michael: And they kept saying, no. No. No. You gotta miss a payment and do a loan modification. So I drove down to BB and T a couple years in because I was paying an arm 6%, parked out out front, rented a sports car, walked in and asked for the top three people of BB and T by name.

And, they actually got their offices on the phone. They thought I was supposed to be there. I brought a briefcase and everything. So security escorted me out. The next day, they called me up and they said, you know, what was that about?

I said, I just wanna refinance my mortgage. I called them loan modification. They want me to miss a payment. They sent me a refinance letter the very same day, refinanced me at, 3.75%. I got it the next day in the mail.

Steve: That's awesome.

Michael: And the funny thing is years later, I got a BB and T loan on a on a building called the Professional Arts Building. So I told the local market president about it. So he he he talked to some people at BB and T corporate. The people I said I contacted, they remembered it. They thought it was very funny.

Steve: I think the key here, because a lot of people, you know, they try to go through the front door. And there's nothing wrong trying to go through the front door. Right? Like, that's the way you're supposed to go. But the front door doesn't always work.

And if front door doesn't work, you gotta go through other means and measures. And that's what you did. So I love that. So you actually rented a sports car? Yes.

Did you did you just buy that suit that day?

Michael: Yes. And I double parked out front. But I got my refinance. I got my refinance. You know?

And then years later, the farm's actually an Airbnb now. I'd I ended up living there ten years. I went from never living in a farmhouse, never living in the country. I moved in there, Steve. There was four chickens in the barn, and I heard about the livestock auction, like, 15 miles away.

So I start going to these livestock auctions. You know, I'm a young kid. I'm I'm I'm wearing a tie. I'm around these Mennonite, seeing these Amish folks. I mean and literally every animal that went through at a at a deal I ended up buying.

So to make a long story short, I had over a 150 animals. Now it's an Airbnb of about 70 animals, peacocks, guineas, turkeys, goats. If you want, you can stay there for free. We were at it for about 300 a night, and it's it's attached to a a bunch of state parks. So there's hundreds of acres behind it.

And, I actually had this all all, six Washington County boys and girls clubs up there multiple different years, and I ended up living there about ten years, until I moved in, 2015.

Steve: Did you make money, like, flipping the livestock too?

Michael: No. No. No. It was just, it was a hobby. Got it.

I decided I'm I'm doing enough real estate. I'll work on my office and stuff. But but the cool thing is we get a lot of families there from all over the country. It stays pretty booked. You know?

It's kinda like a destination Airbnb now. And Interesting.

Steve: It's

Michael: bringing in about $6

Steve: a month, so I'm happy

Michael: with it. No. But I I should, I I should leave that. Behind it. It's not doing really well.

Steve: Okay. So first deal, remind me again how you got the first deal.

Michael: So I put bandit signs out.

Steve: The first deal

Michael: is It actually came off a bandit sign.

Steve: Awesome.

Michael: And,

Steve: so did your first deal was bandit sign. The fourth one, was that

Michael: a bandit sign too, that farm? It was, it was a mixture of direct mail and bandit sign. So Got it. The the farm was actually, direct mail.

Steve: Okay. And so for everyone listening, like, how long ago was this?

Michael: This was in 2005. I first got that deal, and I closed on it in 2006, right right end of 2005, 2006. It was beginning of it was maybe 2004, 2005 I got the deal. Mhmm. And then 2006, I I closed out the deal.

But you gotta imagine you're in a one bedroom apartment. You've done but when when I when I first, got that deal, I had done three real estate deals. I I had around $30 to bank. You know, I I I was rolling. Some peep you get a call from a farmer who wants a million dollars for his farm.

Some people are gonna say, hey. I, you you know, I I'm I'm not ready for that deal. You know? You you never know until you look at it. And it ended up being one of the best deals of my lifetime, and it definitely, allowed me to, not miss a beat through the recession, and pay all my debts and move forward.

And

Steve: Yeah.

Michael: By I I and the recession was great to a lot of real estate investors that could take advantage of it.

Steve: So we're, like, fifteen minutes into this. Right? And I've heard two two two instances where being super resourceful paid off big time. So one of the things that, you know, I I've mentioned before talking about, like, what you need to be successful. One of them is resourcefulness, and we look for that when we hire.

So it seems like you got that in space. How would you teach someone or show someone how to become resourceful?

Michael: Don't let fear block your way. Don't let, you know, distance block your way. Think about what you're doing. Make sure you're not doing any one deal that would take that would take your business under. You know, know, on the farm deal, I knew I was paying for it along the way.

Mhmm. You know? And then I I was ultimately gonna figure out a way to do it, but you wanna look at everything. You know? You don't wanna do something that doesn't make sense.

You don't wanna get distracted. You don't wanna, get, 20 things going on to where you can't do anything. But if when you're when you're just starting out and you get a deal, if someone calls you up and they want 500,000 for a building, that building could be worth 700,000. You might be able to negotiate it for 400 and make a $100,000 wholesale fee. You know, always move forward and, don't don't be scared to actually do.

So many people when they start out real estate, Steve, they they think they think about what they're gonna do, but they don't actually do it. Now when the leads actually come in, they don't, they they they hold back on calling. They don't

Steve: Yeah.

Michael: You know, if you take action and you take massive action, it's gonna work.

Steve: Right. So you did the farm thing, and you said along the way, you were doing additional deals. So what other kind of deals were you doing?

Michael: So my second deal was a subject to the existing mortgage. That's where I actually bought the property, closed on the property with a, with a title company, Premier Settlements and Title, I believe it was at the time. And the mortgage stayed in the homeowner's name, but the deed moved in my name, and I got title insurance on everything excluding the existing mortgage. And when I wanted to do the deal, you know, you gotta remember, I looked 10 years old, 11 years old. I had a baby face.

So I used to I used to go in and I used to go with my tie, be all dressed up, and, and I I used to always say, let me get back to, let me get back to, my my my senior advisers. I had always I'd always say, let me get back to someone else because they thought I was in charge. They wouldn't take me serious.

Steve: Right.

Michael: But what that did is they always you know, a lot of homeowners would tell me, hey. Here's what I really need for the property. You can go ask them for this. So when I was asking a lot of people with the RIA, you know, my first division of proceeds contract, I got from someone at the local RIA. My first, subject to contract, I mean, it was it was a it was a 40 page, a friend of mine now, loop around contract I got from someone at the RIA.

Yeah. And, that that that's how it happened along the way. Now now my third deal was an owner financing deal. My fourth my my fourth deal was a farm. My fifth deal was subject to the existing mortgage.

Steve: There's no trend here. You're just doing all sorts of different deals.

Michael: Well well, correct. So what first, I did all creative deals because I didn't I didn't have you know, how was I gonna buy properties without money?

Steve: There you go.

Michael: So, you know, good creative deals, division of proceeds, subject to the existing mortgage, owner financing. Then about two years in, I started raising money, and and that's where things got really good because, and it was, 2005, I guess, about a year and a half in, a fellow by the name of, of, Richard Greenwald came in my one bedroom apartment, and Richard had built a business to 400 employees, just one of the businesses he built, and they were the biggest in the in the country for Christmas music. They invented the Christmas music box sets. The really nice guys. They, and he, he he came in my apartment, took my shoebox full of receipts, said, Mike, you need a bookkeeper.

Steve: Mhmm.

Michael: Then he said, Mike, you need an office. Then he said, Mike, you need you need a girl. Friday, you need somebody at the office. And and at first, I didn't know why was I spending all this money. But the the the truth of the matter is him coming into my life is really what allowed me to, really grow as I've as as I've grown along the way.

So this is

Steve: a guy, massive success, 400 employees, walks into your apartment and is like, alright. You gotta fix this, fix this, fix this.

Michael: Correct. So he actually he was in his, he was in his, late seventies at the time.

Steve: What was he doing? Mentoring, you know, this

Michael: I I just I just, so he was a member of a local group called Score. I just went to him and said, hey. Score. You know, I'm I'm looking to raise some money. And, he wanted to know more about what I did, and so he came in and and helped me with it.

The funny thing is they're the biggest in the country for Christmas music, three Jewish guys. They sold their company in 1989, for $40,000,000. And, now we're still friends to this day. And, he still he works out three times a week, does elliptical frat hours, super great guy. But the first four years of my business, he was really involved in, in advising me when the recession happened.

He said, Mike, things are gonna keep dropping. Cut everything out like a cancer.

Steve: Oh, he was the guy. Guy.

Michael: Pay all your investors. Don't don't modify anything. Don't short sale anything. You know, work on your reputation all the way through. And, you know, I've I've got a flawless reputation on the lending side.

Mhmm. And and I've I've I've I've I've done so much real estate over the years, but I I have a good understanding of real estate deals. And that's why I like that's why I like the fund I have so much with with my partner, Mike Zlotnick, because I get to look at deals all day, and that's that's fun to me.

Steve: Well, I think one thing just, you know, we we kinda touched on it really quickly, but I wanna emphasize for everybody. You know, you went to SCORE. And so for some people that can't afford to get a mentor, right, can't afford to, you know, join a mastermind, this or that, there's a lot of free mentorship. And the guys that are involved in SCORE are older folks who've had successful businesses that wanna help young people get started.

Michael: Well, it it they're really awesome. And, actually, all my new managers now I actually I I learned this. I got this advice from a a guy by the name of Guy Stern. He's, I asked him how he became so successful. He said from a young age, he always worked for billionaires, and he gave me the advice to give all my managers a business plan and have them fill out the business plan, for what they're doing.

So I use a score business plan for that to this day.

Steve: You do. Wow. That's impressive. Really long. So I'm I'm surprised that they're able to complete that.

I've tried it. I did the score business plan. I did it one year, and I could never do it again because it's so freaking long. Okay. So how did we so you you did I mean, you're doing these deals, then the recession occurs.

Was that before or after you started looking for money?

Michael: So that was after, and I'd already borrowed money. So at the time of the recession, I had seven or eight renovations going on, and everything went down. I I took over a half million dollars in losses, and I leveraged equity in the farm to pay that

Steve: Mhmm.

Michael: And didn't miss a beat. I didn't negotiate any interest, and I was paying 12 to 15% interest at the time.

Steve: But then So not only were the investors kept whole, you're paying them interest as well. Yeah.

Michael: I paid their full interest, took all the losses. After the recession, I went from being over a million dollars positive to about 200,000 negative, but I I worked my way. I I did everything I was supposed to do. I paid all my debts. I never, I never, didn't pay a dime of interest.

So it's, I've I'm proud of that fact.

Steve: Yeah. That's really impressive because I I know people that made it through recession, and they never they didn't necessarily fall. You know, everyone was was repaid. But I don't know anyone else who was paying the interest as well. Right?

Yeah.

Michael: I paid all the I paid all the I paid every single bit of interest. You know, luckily, I had seven or eight going on going on. You know, if that happened, you know, a couple years down the road when I had 20 going on, it would have been a little tougher.

Steve: Yeah. For sure. Alright. So you're finding money, and then you, the recession occurs. So what did you do during the recession?

Michael: So during the recession, I, did more deals. I, looked for real estate harder. I bought real estate lower. All recession did was change the numbers I buy. I had to change nothing else.

Yeah. And, actually, a couple years of banks wouldn't work with me my first three to four years. Every time I went to a bank, they, they said I didn't have enough experience or, you know, I didn't so I remember there was a fellow Steve Michael in town for a long time. And he used to tell people when when Mike first came in, he looked 10 years old. And I said, this kid's even gonna be really rich or flat broke.

I can't take a risk on him yet. And the same thing, I I used to walk into all the banks and I it took after about four years, I started working with the bank. The recession was still going on. You know, it's a lengthy recession and it was, the best thing I ever did. You know, I started picking up a lot of rental property and in real estate, rental property is very forgiving.

You know, I I anybody getting into real estate, I'd recommend wholesaling at first building capital then picking up rentals. The great thing about rentals is no matter what you're making what what you're making a day on cash flow, you're paying it down. You're increasing equity. You got a good write off. And, you know, I've been very blessed to have the rental portfolio I have.

And, I recommend anybody getting into real estate, you know, if you're sitting on a lot of cash or wholesaling a lot, turn to the rental property, buy it at a discount, refinance it. You don't have to have 20 or 30% in it a lot of times if you buy it at a discount and and grow wealth.

Steve: Yeah. So you're acquiring properties. You're buying these are for buy and hold? Yes. Okay.

So then what you do once things turned around? Like, when did when when did the

Michael: So I was so so so when during during a recession, I wholesaled, I renovated and flipped homes, and I bought I started buying rentals about four years in. I I did I did the whole array. It wasn't until about 2000 and, and, yeah, be before 2013, I just did regular, real estate projects. Although my fourth deal bless you. Although my my fourth deal was a was the was the actual subdivision deal.

I did another subdivision deal in between which netted about $5,500,000 equity. I did pretty good. And, it took me, like, four years to sell. That's how these deals tend to work. But I, I I I just kept moving forward.

And then in about 2013, I took on a condo project, my very first one, to this day in in a market that has some very high end condos. That project through four and five resales last time I checked two months ago still has the highest selling square footage. In Frederick, Maryland, 900 square foot condos, for about 500,000. So I've done, I did an I've done two I did another high end condo project, the Pythian Castle. And then I've, so

Steve: I mean, when you say you build a project, what does that mean to do a project?

Michael: That means I buy a building. I completely gut it and completely redo it and make it beautiful. And then So you're

Steve: well, some of us are wholesaling contracts or flipping houses. You're flipping entire projects.

Michael: Correct.

Steve: Awesome.

Michael: So right right now, I got one of the coolest ones in my lifetime going on. I'm actually hoping for a state catalyst label. Yeah. And it's looking like I'll get it.

Steve: For what label? A catalyst label. What does that mean?

Michael: It's I'm I'm hoping, and I think I'm gonna get it a federal state and city partnership on a catalyst project for a city. In 2015, somebody called me up. It was kinda like the farm deal, Steve. And they said, Mike, are you interested in buying this office building? The bank was in big trouble.

The feds were about to take them over, and they had to sell 270,000,000 in real estate or the feds are gonna take them over. So I ended up buying a building called the Grand Piano Building on a short sale. The original note was 2,200,000.0. I got it for approximately 700,000. Had never done a project over the condo project, which was less than 10,000 square feet, and I bought a 50,000 square foot office building.

But I said to myself, if I'm buying a 50,000 square foot office building for 700,000, it has to be a good deal. Right?

Steve: It has to be.

Michael: So, actually, that was my first city partnership. The city contributed a $150,000 to that project as long as I hit my goals. At the end of the day, I added over a 100 jobs downtown and, and about 5,000 feet on the street a month. Now the big part of this is when I did that project, local developers called me up. This was before Hagerstown, the city I'm in, started really moving forward.

They said, Mike, what are you thinking? It's gonna take you ten years to fill. This could bankrupt you. You've been doing so well. When I finished the building, it took me four months to fill.

You wanna know how I filled it, Steve? I went to the market next door in Frederick. It's popping. I started knocking on business doors asking them if they ever thought of opening a second location and taking them to Hagerstown, and I a 100% filled the building. So in 2015 Wow.

I got a citation from the governor in the state of Maryland, which is a good thing, not like a citation, like a ticket in in front of about 800 people at the Maryland Theater. And it was, thanking me for being an entrepreneur in the state and making such a big contribution towards the gentrification in Hagerstown. And then a lot of other folks started, jumping on jumping on as well, and now Hagerstown's really took off. You know? We have

Steve: thousands of people. Get into a position where the city is calling you or or some institution the city. So you called the city. You're asking, like, hey. You got anything that you guys are taking down?

You guys were closing on any property?

Michael: The city. The city I I bought it from a bank. Oh. Then I went to the city and and said if I do these certain things in this amount of time,

Steve: will

Michael: you contribute towards the project? And the city contributed a 150,000 towards the project.

Steve: Got it. So it's kinda like, some of the, city subsidies trying to encourage companies to do that.

Michael: Correct. And I I did another one, that was about 600,000 in contributions about two years ago, and now I'm working on the biggest one yet.

Steve: Yeah. So okay. So you go into the city and they're working with you. So it's not necessarily the city calling, like, hey, Mike. I need you to buy this property.

It's the bank's No.

Michael: No. No. That that was a that was an owner calling, connecting me with the bank because the bank was looking to move the property. So the bank would this bank in, in the recession literally had to sell a lot of real estate. So they were calling your borrower saying, look.

We won't go after you for the money, and this was a nonperforming note. So I was able to get to per property at about a 1 and a half million dollar discount from a note. Then I raised some money going into it. You know, you gotta figure I'm going to investors I normally flip houses with and banks trying to raise money for this. We put about one point, we we put about one point, 2,000,000 into the building.

Mhmm. And I got a 150,000 of that back, and it's, it's a good building. You know? I'm actually my office, we just moved in there a couple months ago, so it's

Steve: a great day.

Michael: Still own it? I still own it.

Steve: Got it. Alright. And then from there, how do you go to you said, you know, a few like, 400 plus doors.

Michael: So I I just along the way, good deals that came up, I was buying. Actually, in the past four years, I've sold about 200 doors or I'd have more. And then, most of them I own myself. I have a partnership in Oklahoma where I have a 105 units with two guys that that's going well. And the doors, so when banks started lending to me before they could blink, when when a banker first took a chance on me and now that that banker is a commercial lender, took a chance on me, said, you know, I'm gonna take a chance on you.

And before he knew it, I had 2,000,000 in loans. So when I went to another bank, I said, well, this bank's giving me 2,000,000 in loans and rentals. They're working out good. I can still keep working with them. Would you like to give me a loan?

Like, if you wanna do anything, let me know.

Steve: Right.

Michael: And, and before you knew it, I was working with four or five banks and had and, I said and I said when I was 20, five years old, I wanted to own 200 rental units by the time I was 29. When I was 27, I owned 200 round units.

Steve: That's awesome. That's incredible.

Michael: And I did it from nothing. You know, my my biggest achievement still is, you know, I was able to, to, buy my childhood home back from my parents and move them into it. So I'm Yeah. Happy about that.

Steve: So one of the things that people, you know, kinda, like, have a mental hurdle that you need again, I'm talking about earlier, you know, you needed money. So what was your circumstance growing up to

Michael: See, my my my dad worked very, very hard. You know? He always had, two, three, even four four jobs. And, when we when we were growing up, I used to get, bags of clothes on the porch from churches, presents from churches around holiday times. You know, my dad worked really hard, but, I I've always been motivated to make money.

So when I was eight and nine and 10 years old, I was shoveling sidewalks. When I was 10, I had a paper route. I got my first front page newspaper article. They dropped me off in neighborhoods, and I ended up selling almost every door that opened. So I sold over 2,000 new newspaper subscriptions in the summer.

Mhmm. I started a paper out of, like, 70 customers. When I was done, it had 400, and they had to split it in half. And they, gave me a paper article. It was called the Bird Boy Sharpsburg.

In the middle of an article, it said this charismatic, five foot one, seventh grader says what he's gonna do do is, sell all his baseball cards and open up a pet store, even a chain of pet stores. Then, I had always worked before I was 18. You know? So I

Steve: was 10 years old that you were in paper about opening all these pet stores?

Michael: Yeah. Then I then I had about 20 lawn mowing jobs. I started paying other kids to mow them. Yeah. Then I, before I before I went in the army, before I graduated, I I played, sports every season, and I I went to, I worked at Britches Great Outdoors, a clothing store, the Timberland, Levi's Dockers, multiple restaurants.

Type of business before I went in the military. Even when I got out of the military, I said, you know, what do I do? Do I do I go out of college? I I wanna make money. Yeah.

And I just kept looking for ways to make money. I read something in Forbes about importing, so I did the deal on China. And then a guy said, hey. You sound like you make a better real estate investor, so I turned to real estate.

Steve: The reason why I'm asking this is because I want these people to get the the limiting belief that you need to come from money or your parents need to see jobs.

Michael: I I come from no money. My parents are really hard workers. They're wonderful people. My I definitely got a work ethic from my parents, but, you know, I come I I I started with nothing. You know, my my parents really struggled when I as I was growing up.

Late later on after I was in the army, they they were, they my my dad went full time army, actually, full time national guard for the retirement. But, growing up, it it started out when I was nine or 10. I I wanted, I wanted, new clothes. I wanted some of the clothes other kids wore because I'd get picked on for moving to, different towns and and getting clothes given to me and and wearing the same clothes that somebody else wore that they donated. So that's where it's you know, I've just always been motivated.

But I remember from a very young age, I used to, hide my birthday money until it added up. I'd always end up giving it to my parents to help them out, same with the paper route. I, I I contributed, my whole time growing up. And Wow. But I'm I'm grateful.

My like I said, my dad's a hard worker, and they're good people.

Steve: So going back, I know you said that, you know, you just had deals just coming through and, you know, just kinda it it sounds like they fell on your lap, but they ultimately didn't. Right? Like, when you're acquiring all these No.

Michael: Nothing nothing really falls in your lap. You know? I was I was marketing. I was direct mailing. At that time, I mean, it was it was it was really easy because all these foreclosures kept popping up.

All these short sales on the MLS. So a lot of the deals at that time, I got on the MLS.

Steve: So you weren't even so you're finding that the the multifamily on

Michael: the MLS. Correct. But the overwhelming majority of my deals in in my lifetime had been for marketing or personal referrals. Mhmm. You know, I I have an apartment complex in in Hagerstown, Longmeadow Apartments, one of the best deals I've ever done, and that was a referral from an appraiser.

So, you know, I always tell people what I do, and to this day, I get five, ten, 15 real estate referrals a month.

Steve: Wow. That's really good. I used

Michael: to when I was when I first started, Steve, I used to stand in line at Borders, if you remember that bookstore. Yeah. And, I used to start talking to people in line and just just start making conversation. Then I talk then I'd say, hey, guys. I got a question.

How many of you drive by a piece of real estate that looks a little bit rundown? How long does it take it to write down the address? They'd all say, like, thirty seconds to one minute. And I'd say, so, hey. If you're for me 20 of them and I close on one and I give you $500, that's a couple $100 an hour.

So I I literally from doing that at different stores and talking to different people, at one point in my life, I got 40 to 50 personal referrals a month Wow. Just from telling everybody what I did. And I I used to hand out referral fees all the time.

Steve: Were you handing out those metallic business cards then?

Michael: No. No. No. More more recently, I do mass, I I do a lot of marketing, a lot of direct mail

Steve: Yeah.

Michael: RBM and stuff like that.

Steve: Alright. So you're acquiring all these doors, and then, somewhere along the line, you get involved with Zlotnik.

Michael: Well, that that's way down the road. So Way

Steve: down the road.

Michael: I'm fortunate to be a member of, of, of, two masterminds, Collective Genius, the top mastermind in the country for real estate investors. Great folks. I've been a member six years. The fund is more in the past two years. So March makes seventeen years in real estate.

I've literally been doing real estate 44% of my life, Steve, and I started with nothing.

Steve: Yeah. So you recently you said the last couple of years connected. Yes. Was it a lot, Nick?

Michael: And and that's that's really what I see as, as a future. You know, I I wanna get it to where I we're we're very good at what we do. We got a lot of great tier one sponsors from the pat mastermind. What that means is guys that have been doing real estate a good number of years, and they're buying properties at discounts. So we got a lot of opportunity.

Mhmm.

Steve: We

Michael: have third party administration, so everything's verified. In, 2019, q one through q four, first full year of inception, investors made over an 11% return with 10% distributed, and, I enjoy it. You know? So what what I right now, we're still doing marketing. We're still we're still, picking up a lot of new properties.

But what I wanna get it to in the next three or four years is I'd like to do one big deal myself away from the fund because I don't borrow from the fund like an apartment complex Mhmm. An office building and really be a fund manager. I absolutely love it. You know, a lot of our sponsors are are just, amazing what they do. You know, it's the guys that are going out there offering on a 100 apartment complexes a year to buy two that are worth 5,000,000 for two and a half million.

So I feel really comfortable. The downside protection is massive, and I really look at that as where I wanna be in the future. I'm hoping I'm 37 right now. Just turned 37, but I'm hoping by the time I'm 40

Steve: the baby. You

Michael: gotta be this. I'd like to, I'd like to you know, my goal is to, raise a 100,000,000 from Fund Buy, and we we we have the clients to put it to work. We got third party administration in the next three years. You know, first, I I, I I'm in such a great mastermind, great folks, you know, both masterminds. I mean, I'm also in the in in in the top for real estate marketers.

You you just I like a lot of the guys in it, and Collective Genius is great. So through Collective Genius, I was recommended EOS. So we got EOS, and I'm work I'm working on getting the business to where I have to be there about ten or fifteen hours a week, then I I just wanna raise money for the fund. Whenever you're looking at real estate deals and every single one, it's like, man, I wish I had that deal. It's it's a good day to lend on them.

So I, I I really enjoy that.

Steve: The other one you're talking about, you're talking about, Matt Andrews?

Michael: Yes. Yes. Matt Matt's a great guy.

Steve: I'm in that one too. That guy, he's he he kinda cracked the code a little bit with Clubhouse. I mean, he's just crazy in that thing. Alright. Yeah.

So we're both in in in CG together. So while I was at CG, someone introduced us, Kong Lee. Great guy. Wholesale to millions. Wholesale to millions.

So he said, Steve, you gotta meet Mike. He's my mentor. You wanna talk about that?

Michael: So I haven't mentored many people, but I have mentored three people. And, all three people I've mentored are are crushing it. Just crushing it. So, Kong, it met me. I I'm I'm friends with, a fellow by the name of Robert Shem, and he wrote a book, Why Is That It He Rich and I'm Not.

Super great guy. So he invites me different places. I went to one of his super high end seminars, and, Kong comes up to me. He says, my wife says you gotta coach us in real estate. I'm like, look.

I I don't coach people in real estate. And then, he said, just just give me a number. Give me a number. And after he he was so persistent. After about a, half day, I gave him a number.

He, he paid me. I went out there for three days. He had been going to high end seminars for around seven or eight months or any seminars trying to pick up his first deal. Mhmm. He picked picked up his first deal within a couple weeks of me going out there, had three deals in two months, and I I gotta give the guy credit.

He's he's amazing. What he what he's done and what he's turned his business into is absolutely something special. He's an amazing wholesale business. He he he is an amazing business providing people info on real estate. He's amazing guy.

Yeah. And, I I I told him what to do. He did it, and, he crushed it. He's come a long way on his own right. And there was, two other people too that are doing very well.

Yeah. I've decided with focus, you know, coaching really isn't what I do, but I I'm probably gonna set up something once I'm just raising money for the fund and and my office is really managing a lot on its own, which I'm already seeing that that start to happen. I'm probably gonna do something where I where I bring maybe one person a month to my office just to, shadow my office and me for a couple days. It's some kinda some kind of fee because I the the value someone gets off that is is is massive.

Steve: Right.

Michael: But, yeah, I like I like Khan a lot. He's he's a very good guy.

Steve: Great guy. And, you know, we we're we're always, you know, texting, you know, pushing each other. So, but, yeah, I I I wasn't sure what to take him because he's always, like, you know, like, kinda joking around a little bit.

Michael: No. I was his mentor. Yeah.

Steve: Alright. So, I mean, you're in Maryland. It's there's a lot of people in Maryland. Right? Like, you have to only fish No.

No. No. No. No. Yes.

So how are you different than than your peers?

Michael: So I I'd say I'm different than my peers because a lot of folks, they just stop marketing. Once they get some deals, they they stop marketing. They do those deals. They interrupt their marketing. Or, you know, other other guys, they they get a hang up and they slow down.

One of the biggest things I learned in real estate, Steve, is if you have a problem and you lost money on something, do more deals. If you stop doing deals, that that kinda messes you up. If you keep doing more deals, pay for the problem and move on. You know, I learned that, I guess, in, after recession in 2011, 10/2011, I had a building collapse, and insurance company denied me. And it was a 13 unit apartment building.

And, it collapsed while we were doing work. I I had no idea there was foundation issues. And, I fought the insurance company. I won. I I still got a fraction after paying attorneys, but over over that time, I could've just stopped.

And if I just stopped, I would've been hurt, and I would've had to sell stuff. But I kept wholesaling. I kept buying and fixing up, and I paid for everything and and and moved along. So I'd say, you know what? Once you start doing real estate, don't let anything slow you down.

Don't let anything hold you up. Keep moving forward. Because as soon as you stop moving forward, you take a chance of moving backwards. Yeah. And you just don't want that.

You know, real estate has been, very good to me, and I I I credit it to the action moving forward and, you know, being blessed to be around wonderful people. And speaking of Kong earlier, I've learned stuff from him in the last couple years, but, that that's been a wonderful relationship, and he's he's a great guy.

Steve: Yeah. The last time we hung out, you and I was about, let's see. It was it was actually last month. We're and we had the chance to see Mark speak, Mark Dela Torres speak. And I think everyone got, like, a big crush, on his business.

Michael: I agree. I agree.

Steve: So what does your business look like today? Or what does your organization look like today, and what do you want it to look like?

Michael: Okay. So what it looks like today is I've hired some high level people. We got a rental division. We got the wholesale division, which we're which which we're going moving forward on. We got the rehab division, which we're kinda slowing down on.

We got the accounting. And, and then we have four VAs that are doing, that are taking all the calls, live calls from advertising and stuff stuff like that. And then we have three maintenance people. So right now, I'm trying to grow my managers. I learned a lot from Mark about letting them make mistakes and really just try to be the the best I can be for them.

And and I I I feel like what what Mark did was the right way. One thing he said one thing he said during the mastermind that really touched me was the fact he he let his, implementer go work in each part of the business. You know, I think that's really important, so I took that out of it. And, so my my organization today, we we have a whole chart. It's me and the COO then, then the, the finance manager.

And then, over top of different divisions, the person is charged to sales. The the person doing the selling isn't a VA anymore, and, then the the con the construction and the rentals. I used to have a RIA. So I started a real estate investor association with two guys. A lot of folks have spoken my RIA actually in CG in about 2007.

Then in 2017, I decided I really knew the focus if I wanted to get to being a fund manager and get everything I wanted. So at one point, we had, like, 300 members. But, I ended up giving up the RIA and just really zeroing in on, zeroing in on the business.

Steve: Yeah. It's tough because I got I wouldn't call it a RIA, but, you know, we have our

Michael: meetup, which is a lot of fun. They're always fun, aren't they?

Steve: They are. Right? And you you get to hang out and drink and whatever. But COVID really screwed everything up. And so, like, I haven't had one since March.

And so I gotta figure out what I wanna do with that.

Michael: COVID is, it depends how it relates to your business. You know, if it relates directly to your business and it doesn't take your focus away, I'd recommend keeping it. If it doesn't if it doesn't meet the end goals and it doesn't relate directly to your business, maybe move on. But I'll I'll tell you they're a lot of fun.

Steve: They're a lot of fun. No. I always it always reinvigorates me. It gets me fired up. So one question, I wanna ask you.

It seems like you're always got things going together. Things seem to be, you know, working really well. Do you have moments where you're discouraged or, you know, feeling down on yourself?

Michael: I think everybody has moments when you're discouraged. Mhmm. But, the best thing you can do is is think about the end result, and you're already on the way there.

Steve: Yeah. You

Michael: know, of course, I have moments where I'm discouraged. But, you usually, when I have those moments, I I think about all the great things I have to be grateful for and, where where I wanna be. You know, I'm a big, believer in in in in announcing what you want. You know, I I am doing this. I can do this, kinda like the Saint Germain thing.

Steve: You

Michael: know? I was a little bit discouraged as, you know, I was when I first joined CG the first couple years, I I see all these amazing guys, and I see me working forty, fifty hours a week to be amazing. I was like, I wanna be one of these guys. So I've I've we're working on that, and we're, we're we're getting to that point very quickly now. So I I would say I would say yes, but I I always move on move beyond that quickly.

Steve: Got it. So tell me about the Dream Fund.

Michael: So the Dream Fund's with me and my partner, Mike Zlotnick. Mike has a podcast, big, big, Big Mike Fund podcast. It's, he's been a successful fund manager for, about ten years. And we really came up together because I've, I looked at what he was doing, and he could put a lot more money to work. You know, we're in his mastermind.

We have these guys buying real estate at fractions

Steve: Mhmm.

Michael: On the dollar and, you know, just through it's it's relationship deal making. We don't take people on the street. Mhmm. We meet people in masterminds, and we which we, look to be part of their deals where it's a win from them and make sense for the fund. Our target return is 10 to 12%, and we pay investors a 5% preferred return, on their money.

Meaning, if a fund ever didn't make, 10 to 12, that 5% would be made up, in when when it did. Mhmm. But so far, we've, we we've done very well even through COVID. I'm I'm happy with this year, and, we feel good about our targeted returns. And then we have third party, fund administration, which means they they look through everything, verify everything, which is VeriVest.

Steve: Got it. So, was that what you were talking about earlier where you get first looks on lots of great deals?

Michael: Yeah. That's that's really enjoyable to me. You know, I I love looking at real estate deals, you know, the the deal itself. And I I feel like too when a tier one guy is doing a deal, I can add a lot of, add a lot of value to that. I also like the wholesaling model.

So the idea is that we're gonna we're gonna really I'd like to slow down down a rehabbing, do one big deal, keep the whole do one big deal at a time maybe in three or four years, keep the wholesaling model going, keep my existing portfolio rentals, and then, really just work on on the fund.

Steve: Got it. So

Michael: You've had by the way, I love your podcast. You have some really awesome guys on here.

Steve: We're very lucky to have some really good names, come out here and including yourself. So you said you're 35?

Michael: I'm 37.

Steve: 37. Alright. So you could stop right now.

Michael: I could.

Steve: So why don't you stop? You know, I

Michael: I I'm driven. And on top of being driven, the core key people in my business, I wanna take care of and provide retirement for through real estate. And I'm not ready to stop. You know? What am I gonna do if I stop?

I'm 37 years old. I I I, I want to, really be, I I really wanna, have the wholesale model because historically, I've done a lot of rehabs. You know, I was doing, sixty, seventy plus rehabs a year for a long time and only a chunk of wholesales. I'm trying to get it to where it's all wholesale so it's less time consuming. And, I really like you had a guy on here a few weeks ago, Eric Brewer.

He's he's an awesome wholesale model. So I'm really trying to, really trying to, get the wholesale model going, super strong and just move forward. I don't I think if I stop, what

Steve: I do, Steve? How bored you'd be bored. You know? Part of my mind.

Michael: What would you do? I just I I don't see any reason to stop right now. When I'm gonna stop, I don't Yeah. And that everything moves forward, very smoothly regardless. What what about you?

What keeps you going, Steve?

Steve: I just have to crush everybody. I don't know what what else to say. Right? You know, my, we had, the kids were, you know, they're they had an extra day off with COVID. You know, like, school's trying to figure out what to do.

So my wife's working from home, and they're like you know, I was like, you know, you guys ready to go back to school? The kids are like, no. Not really. I asked my wife, you ready to go back to work? She's like, I guess.

She's like, what about you? I was like, I can't wait to get back to the office. Right? It's killing me sitting at home, like, not doing anything. Like, I'm playing freaking solitaire, watching videos on, like, on TikTok.

Right? Listening to things like clubhouse. I'm going crazy. Yeah. I need to be doing something.

Michael: It's because you love what you do. Yeah. That's very important. You know, anybody listening to your podcast that hasn't done their first real estate deal yet, If they start taking action, it'll happen. If you believe it's gonna happen and if you if you keep taking action and don't give up, you're gonna get your first deal.

And one one thing I often think about is my first year in real estate, you know, it's hard to get four deals. By next year, it was hard to get nine or 10 deals. My next year, it was hard to get 20 deals. Well, now, you know, if I push it, I could do over a 100 deals a year.

Steve: Right.

Michael: So it gets easier and easier the longer you do it, and a lot of it's just experience moving forward and taking action.

Steve: Absolutely. Absolutely. So what is

Michael: your biggest struggle right now? So I've got, I've got a lot of new high level people through hiring EOS, like business implementers, and it's giving giving them enough time and growing them enough and that and and not just, not just jumping on things myself.

Steve: Got it. And what is your superpower?

Michael: I'd say networking. I, I love to network, which is why I wanted to be a fund manager. Actually, COVID's messed me up on that. I've, I've got some great friendships in The Middle East. I got great friendships in America.

Some people have seen me in a room and said, Mike, why watching tonight? Do you realize you went to all 70 tables in this room and, shook everybody's hand? Honestly, I I can't do that with COVID, but, I've been able and I've been fortunate enough to, meet a lot of great people networking. And, a lot of folks in CG and other folks have told me that's my my superpower. So

Steve: Interesting. I did not know that. You did you did make an appearance in our last YouTube video about CG giving the toast. Guys, please ask questions. Right?

Like, we got we got Mike here. I'm asking a lot of questions here, but this is this is open for you guys to ask questions as well.

Michael: And and my Instagram, if Steve doesn't mind, is Mike, the number two, the t h e fits. Mike to the fits.

Steve: I tried tagging you on Instagram, but you have it set where you can't picture it.

Michael: I can I'll I'll set that off. So I'll fix that so you can tag me.

Steve: Yeah. Alright. So then, I I saw you answer this question, so I I have to ask it. What book have you gifted more than any other?

Michael: Why is that Idiot Rich and I'm Not by my good friend, Robert Shemin.

Steve: Okay. So let's talk about that. What were the lessons in that book? Because that's a very interesting title.

Michael: It it's it's it's it's a fact if you just do it, you believe in it, you envision it, it's gonna happen. Mhmm. If you, if you say you're gonna do it, but you don't envision it, you don't believe in it, it doesn't it doesn't necessarily happen. So it's it's a a lot of people and what they did different and what made them rich.

Steve: But why is that idiot rich?

Michael: You know? Because they because they envision in it, they dream it, and they do it. If you if you if you do it and you envision it, it's always gonna happen. You just can't give up the first time it doesn't happen. You know, would have been easy for me my first I remember probably a month and three weeks into my real estate career, my apartment, is this gonna work?

But, I mean, if you if you don't if you don't keep moving forward, it's never gonna work. Or no matter what you're doing in life, if you really wanna do it, say, hey. Here's where I wanna get. Here's who I wanna be. How do I get there?

How do I do it? And you'll get better every day.

Steve: You know, it's it's interesting because, I have a my best friend. Right? He's still my accountability partner. We still meet every single month. Month.

That's awesome. Let's talk about our business. And, you know, it's somewhat like a best friend since, like, seventh grade. So we still meet every month. And one of the things that fires us up was, like, that guy.

There's nothing more special about that guy than me. There's no reason why we shouldn't be able to pass him. And that's just something that and we're both competitive. Right? And so we're always looking and measuring.

It's like, okay. Well, we should definitely pass that guy. So that that guy is the next target. And once we pass the okay. That guy is the next target.

And, you know, we were saying earlier, what is your what is your why? I think just for me, it's just that competition.

Michael: So I'm I'm definitely ultra competitive. For me, it was, like, really helping out my family, and I've been able to do that a lot. Mhmm. Now, it's my son. I'm a single dad.

So I, he I definitely wanna, create a super bright future for him, and, I wanna take care of people. You know? At the end of the day, when I'm done real estate, I love I love doing charity work. You know? You brought up, Matt Andrews.

Mhmm. And with the family mastermind, you know, he loves charity, you know, and I I I love doing that kind of work. And then the second thing I really like, and this is this is going to, this is gonna surprise you is is I like history. I like old things. So, you know, I'd like to dig up a few sites in The Middle East and, I

Steve: Like, to dig up sites?

Michael: Yeah. I I really I really like burial. I I really like ancient history. Interesting. And I really like, I I I I really wouldn't mind, sponsoring some of the excavation of that.

Mhmm. And, it's just really interesting to me, especially ancient texts and everything else.

Steve: So That's fascinating.

Michael: You know, at the end of the day, I wanna have enough to where I can, where I can do that and, just off interest

Steve: and

Michael: off the rent money. Yeah. And I can also, do the things I wanna do for my family. And, I love charity, especially children's charities. You know, children, are just, their future.

And a child doesn't have a choice, you know, when when I was growing up, you know, you you don't have a choice in how you grow up. You have a choice in what you do when you grow up. And I like, I like being able to help you.

Steve: Yeah. Oh, I I that's powerful. And I think the it's what's important here is, like, we all start with money in our family. Like, that's we that's where we all start, but that's not where we all end. Right?

Because that's where you start. You can stop very early. You can rest on your laurels very quickly. Right? Matter of two, three, four, five years.

That's not what's gonna keep you going. So what's gonna keep you going? You have the bigger why. So you kinda talked about taking care of people, charities, your, excavations. So, Toby has a question.

Sure. Do you find multifamily to be more attractive than single family?

Michael: You know, that's a good question. I like them both. They're both attracted to me. Attractive to me. Kind kind of like, Bitcoin and Elon Musk.

You know?

Steve: Mhmm.

Michael: I I I like, I like single families because you generally get longer longer tenants, and, the the residents are there a long time, and, it's it's really consistent. I like multifamilies, which are also consistent because you have more people in one place, and usually they're higher income earners. You know, I I'd say if you're just starting out and you haven't bought your first rental yet, stay at a single family or a two units. You know? Don't overwhelm yourself.

Learn the ins and outs and, you know, really learn what you're doing. But, I like them both equally to answer that.

Steve: As your company grew and your deal kinda went up, other than experience, what allowed you to continue growing?

Michael: Taking action, moving forward, doing different types of deals. You know, at at the end of the day, I'm a pretty diverse guy. I've done, I've done land deals. I've done office building deals. I've I've done condos.

I've built new homes. I decided that wasn't for me. But at one point, I think in 2013, I built 12 or 13 new homes. And I've, I just kept moving forward and finding what I like. You know, today, I think it's, I have a large rental portfolio.

I think it's wholesaling and, buying a buying a whole asset, here there is in running the fund is where I'm at today. But along the way, it was looking at everything that came before me and saying, at the end of the day, how long is this gonna take me? What's the return? Mhmm. And moving forward, you don't wanna limit yourself to what comes in front of you.

You wanna you wanna limit yourself to what

Steve: Absolutely. I love that. Alright. So we got no more questions. So I'm gonna

Michael: Guys, come on. Let let me ask me a question. Let me help you.

Steve: Yeah. Guys, please fire away. Right? I mean, Mike flew in from Maryland, and the guy's obviously a wealth of knowledge. Like, you talk about your superpower being networking.

I would say your superpower. I barely know you. But from what I've seen, it's just not taking no for an answer.

Michael: And I don't take no, but I've, I have congressional recognition, senate recognition. I have a credibility website. I can I can send everybody on this, but Yeah? I've been able to make friendships in The Middle East. I've been able to make friendships with, you know, different political figures.

I've been able to make friendships. I've, Santana Moss is a good friend of mine, a football player. I have some really good, UFC, fighter friends and MMA gold team. So I've, whenever you're out, you know, meet people, talk to people, find out what they do. And, there's a lot of great people in this world, and you never know it until you know how I met MMA gold team?

I was in a airport security line, and I just started talking to them. And then I gave them my business card, and it, was a UFC fighter, Aspen Ladd, the head of the head of MMA gold team, Jim Westgold from that. And they actually took me behind the scenes at the UFC. I I got to sit in front of a fight with Aspen and all the top fighters, and I I just created a good friendship. So, you know, the world, the world really is a is a great place with a lot of great people.

And until you get out there, you talk to people, and you keep your mind open, you don't know what you're truly capable of.

Steve: Absolutely. Gregory Ballard wants to know how difficult was it to start a fund?

Michael: So that really I have a great partner with a lot of experience. So we we actually went through an attorney. They did a lot of the work. It's a reg d fund with the SEC, and it, I'd say if you use an attorney, it's not that hard. I would not recommend starting a fund on your own.

Absolutely. If you're just doing a fund to to buy and sell real estate, I'd probably look at borrowing the money on a mortgage. But if you really wanna start a fund, I'd I'd hire a qualified attorney and have them do the PPM, the private placement memorandum, and all the paperwork. Yeah. You definitely wanna cross your t's and dot your i's with that.

Steve: Yes. You do. No. You don't wanna mess around with SEC. How would one how would somebody go about finding a qualified attorney to do to do that?

Google. Google?

Michael: Attorney set up a fund.

Steve: I I I was just maybe there was another resource.

Michael: No. You gotta you gotta keep it simple. You know? Too many people complicate everything. Too many people go out there and they wanna start real estate, and they're like, well, if I find a deal, how am I gonna buy the deal?

If I have a way to buy the deal, what if something goes wrong when I do the deal? Well, if something goes wrong when I do the deal, but I get through the deal, what if I don't sell the deal? You know? You just if you don't you you just gotta move forward. Don't don't think so much about what you wanna do.

Lay it out in executional action items. Do those action items and move forward.

Steve: Yeah. Definitely. So let's say I I took you, right, plopped you out, dropped you. Well, I mean, you're in Phoenix now. So you don't have any deals you don't have any deals right now in Phoenix.

Michael: I I don't. But I I could.

Steve: Okay. So let's say, you know, we confiscate your cell phone, give you a burner phone. How are you doing deals right now? If if

Michael: I just had burner phone?

Steve: If you had no contacts, right, we had no relationships, how's Mike gonna be?

Michael: I would start walking around looking for houses that were a little bit rundown and start knocking on doors. I go to the courthouse or I go to the courthouse online. I'd I'd figure out, you know, who may need help that's behind on payments, the divorces, and I I'd start making phone calls. Mhmm. I I'd I'd get it done.

I mean, if you wanna give me a burner phone today, Steve, you really wanna test me. I'll get 50 calls and maybe a deal tomorrow.

Steve: Absolutely. Absolutely. I love it. Very cool. Alright.

So

Michael: The the point is you don't need money to invest in real estate.

Steve: Mhmm.

Michael: You need you need some time, and you need to do it. You know, if you look at my first deals, I didn't do money I didn't need money to do my first deals the way I did them. And you there's always someone out there that whether it's family, whether it's a friend, whether it's somebody you just go up to. To me, it was just I just started going up to people saying, I I made a little credibility packet that that had, hey. Here's who my attorney was.

Here's who my CPA was. Ask some real estate guys at the real estate association if I could put them on there as my advisers. And, just started going up to people saying, hey. I'm looking to raise money to buy and sell real estate. I can give you 12% on your money or 15% at the time.

And now I still pay 10% to a lot of the private guys. Yeah. But it's, it it's been a it's been a good run.

Steve: Yeah. It's it's incredible. And I think that, there there's something that so I I I I announced a free wholesaling course. Right? So over the New Year, it's like, hey, guys.

I'm for 2021, I'm gonna create a free wholesaling course. I'm better than any other wholesaling course you were saying out there is gonna be free.

Michael: Everybody should sign up for it. I'll sign up for it. I'll probably if you learn one thing you didn't know before, it's it's an advancement.

Steve: Absolutely. So, I I as part of that, I asked, you know, everyone to submit a question. And more than half the questions we got was how do I get started? And I counter that with you guys actually already know what to do because you guys been watching this show. So it's not what you need to get started.

It's just freaking start. Anything you wanna add

Michael: to that? You just start. Just start doing it. When I went out to when when I went out, you brought up Kong earlier to visit him. First thing we do is start driving around looking for properties and pulling list.

Just do it. If you don't have money to do direct mail, call the people direct and have a friend call them direct. But just call the people, find your first real estate deal. I mean, for real estate, you know, I I I've heard a lot of times that over 90% of of millionaires and wealthy people had some form of the first part of their wealth created through real estate. Real estate is an amazing vehicle.

It's an amazing vehicle to live your dream life, do things you wanna do, and create other opportunities. I encourage anybody, but anybody listening to this podcast, my assumption is you wanna do real estate. So go to your local real estate association, ask questions, and try to get your first deal. If it's no money down, the division of proceeds to subject to contract, read the contract twice before you go in and act like you've done it a 100 times.

Steve: So we got a question here, from Ale is, you told us about your best deal so far. What's your worst experience or deal? That's a good

Michael: question. Worst experience or deal? Okay. I'm I'm not so worst deal, I have my I'm trying to think because, you know, in real estate, I've had a few learning lessons. They're kinda like college degrees.

Steve: Yeah.

Michael: I would say the worst deals I'm gonna I'm gonna blanket this. Okay? So I but the worst deals, which, I've always paid all my interest on, they they come from, letting it sit too long. In real estate, if you're passive of anything, if you give something to someone else to control and you're not watching it and you're not working through it, that can create a, a a loss. So my my worst deal, I myself, not my investors, had to pay a few $100,000 for the deal.

But at the end of the day, I look at it as it's a it's a beautiful property, and it's a good piece of credibility. So Yeah. I would say that in the beginning, I didn't have you know, when you're just buying and selling and wholesaling just houses, if you're buying right, you're not gonna come across a lot of losses. If you do, the next deal is gonna make up for it. Once you get into the bigger deals, you gotta be a lot more, cautious.

Steve: Yeah. One thing you mentioned just a moment ago, was that you you you wanna do more wholesaling. I was on a clubhouse with Matt Andrews, and he had finagled Grant Cardone to be on that. Mhmm. And Grant Cardone said that you guys are idiots, that if you guys are gonna keep wholesaling.

So, you know, we get big enough, you just keep everything. You don't wholesale anymore. Any thoughts on that? You know,

Michael: I I I don't know Grant Cardone personally, but I have respect for what he does. You know, obviously, he's an amazing guy. I think wholesaling is a good vehicle to keep what you want. Mhmm. I don't I don't necessarily believe in keeping everything.

You should keep what you want. And right now, you know, what I want is the nicer apartment buildings, the nicer houses, and nicer complexes. Yeah. You know, you if you keep everything, then, I guess you still make just as much money in equity growth and paying it down for sure. But I I I I disagree with Grant Cardone's advice there.

I would say wholesaling is a very good vehicle to keep and own what you want and keep the right properties.

Steve: So I had a class a apartment. I wanted to send it to Mike. How would I go about doing that?

Michael: Oh, call me right Mike two the fifths on Instagram. R sent me a personal email. Do do you have the numbers off the top of your head? How many doors? What's it bringing in?

Steve: I don't. I'm just curious because you might you might be looking for more deals.

Michael: Yeah. I definitely, the apartment complexes I'm after are more like the b and a class. Yeah. Plus I sell deals. You know?

I I have some, turnkey apartments we manage, and I still, raise money to buy and sell real estate. I pay 10% of the money, and I have a fund. So I've, with the fund, of course, no investments guaranteed. Investiture on risk. We do have third party administrators, and we have a good record.

With my real estate, I've I've paid every single loan as agreed. I've done everything I'm supposed to do, and I've done, you know, I'd estimate, definitely north of 1,500 transactions. Yeah. So, I love my real estate business. You know, I loved rehabbing, but if you're rehabbing sixty, seventy homes a year, you don't necessarily have the time to do other things, but some people wanna rehab forever.

It's it's what you wanna do. What makes you happy?

Steve: It's your passion. So Jason Tullydon wants to know, how do you keep your edge in this business as far as health mentality?

Michael: I go to my masterminds. Yeah. So, as far as health and mentality, you know, I I've been focused on getting up at 04:30, 05:00 every single morning, reading, meditating a little bit before I go out there for the day. And and during weeks, I have my son, I try to cut it off at around five or 05:30. You know, it's it's easy in this business just to keep it going, going, going, going.

Steve: There's no end.

Michael: But you gotta take time for family and you gotta look if if there's no end, you gotta look at who can do this for me. I remember when I first started getting other people to do stuff for me back when I had my office manager. It's amazing what you can do with other people.

Steve: Mhmm.

Michael: And I'd say the trick is for, any other people you're hiring, whether it be a via virtual assistant and, you know, Robert, Nickel, a good friend of mine, has a good program. They're about $1,700 a month, with Rocket Station or it's a, it's an employee. You wanna say, hey. What I'm giving this person, is that making me two to five times what that person is costing me? If it is, they're they're a good hire and if it if if it gives you free time, it gives you quality of life.

You know, you don't have to wait till you're five years in real estate to hire an employee. You know, if you're if you're starting out and you did your first couple deals and you have, you know, $30.40, even 20,000 in the bank, maybe hire a virtual assistant. You'll be surprised what you can do when you have other people helping you and you create a team.

Steve: It's amazing what you can do. Larry wants to know how is COVID affecting, how you do your business besides not being able to shake hands anymore?

Michael: Yeah. So COVID's affected a lot because I I had made some very good friendships, around the country and around the world, and I, you know, those have, really, didn't I I haven't been able to move us forward the way I lie I'd like to. So I would say it's affected my ability, of course, to shake hands and things like that, but, also, it's affected everything. You know? In the office, we have to social distance.

A lot of times, you know, even even even wear a mask if somebody even thinks they're sick. So it affects how we meet with sellers. It it affects, it absolutely affects advertising. Now more people are home, so the digital advertising, seems to have a lot greater edge on Facebook and stuff now. COVID's affected everything across the board.

I mean, I really hope six months from now, COVID's over. I hope this is a bad dream, but it's definitely, it's definitely affected. I'd say the biggest thing it affected is is how we place tenants, our residents. We we've increased all our standards to move someone in one of our places because at the beginning of COVID, a lot of folks just stopped paying and said, well, I don't have to pay. The the governor said so.

The government said so. So I I'd say we've raised our standard on rentals. We have a lot more Zoom meetings and, and a lot less face to face contact. But we're still buying and selling real estate. We're still wholesaling, and it's actually, it's it's probably gonna lower our marketing cost because we we've started some some Facebook campaigns, and we're getting, we're getting good leads from digital marketing that's, even less.

So anything that happens, no matter who's president, you can still make money. Right. You know, the focus is to make money and to change with it. I I like to think about urban years through all the hurdles I faced. I've stayed in business by, changing with the times Right.

And by, moving forward with the times. So always be willing to adapt.

Steve: Absolutely. Gregory Bowery wants to know if you were starting from zero, how would you get your first commercial deal?

Michael: If you're starting from zero, I would recommend wholesaling your first commercial deal.

Steve: Yeah.

Michael: When you're doing something like that and and you're doing you you gotta make sure if you have a private investor and you're buying, say, a $200,000 commercial property for a 100 and you're pulling you're pulling out $50 and it needs $20, you have enough money, you gotta remember when you're doing these type of deals, you're gonna put some money into them. I if this is your first deal and you have no money, I'd recommend wholesaling a commercial deal. And it's funny you said that. There's a, young lady in California that called me up and had her first commercial deal when she was debating wholesaling it or buying it and holding it as a rental. I said, look.

This looks like it's gonna make 4,000 a month, but what if it doesn't for three months? You should, you should buy it and sell it in, or wholesale. And, actually, it's what she did. I think she lined up some hard money. She's buying it and selling it and making, I think, like, 75,000.

So I would say if you wanna do your first commercial deal, put it under contract and sell it to someone else. How do you find someone else? Look at everybody else who owns commercial property in an area. Look at what they paid for it and give them a call.

Steve: There you go. Ali wants to know, most successful entrepreneurs have a daily routine. What is yours?

Michael: My daily routine is to generally get up around 04:30, 05:00 in the morning. On weeks, I don't have my son. I I I tend to work a little bit late, but I try to stay balanced. I try to stay healthy. Recently, about a a year and a half or a year ago, I was, I'd actually let myself get up to two hundred fifteen pounds, and now I'm down to, like, one sixty five, one seventy.

And, you know, I stay pretty balanced with working out three times a week, trying to read something every day other than, other than real estate and other than business, even though I'd rather be reading real estate in business.

Steve: Yeah.

Michael: And, really just trying to make sure I spend time with my family, call call my parents. You know, every every night, I, I call family members, see how they're doing now. That's awesome. I'm and I I'd like to get it to where I can well, we are getting it to where I don't have to work, you know, more fifteen hours a week, but I I'm I'm gonna do it because I love it. So I'd say, you know, stay balanced, eat right, and, and make sure that you you you're you're reading, you're, you're you're spending time talking to family because ultimately that's what matters in the end.

You know? I know I love real estate. I know I love building. I know, you know, one day I'd like to do some archaeology, dig up cities that are 300 feet under the ground, you know, everything else. But, you know, your family, especially your older relatives, are only gonna be there so long.

You know? Think about what's important today, and that definitely helps you stay balanced in life, what's important for the future, by looking at today.

Steve: Yep. Yuri wants to know which VA service was it that you recommended again?

Michael: Rocket Station, Robert Nickel.

Steve: So, you

Michael: know If if you want, message me on Instagram at mike, the number two, the, t h e, fits, f I t z, and I'll be tagged on the podcast after this. And, I'll connect you with him directly. Cool. And and also for real estate software, I use InvestorFuse, and, they've really, honed in their new software, and that's going really well as well.

Steve: So one thing that, you were saying, sometimes he gets discouraged, because he doesn't have consistent deal flow. How do you stay focused and train your mind?

Michael: So I I got really discouraged in my first year. I was like, why does it take me two or three months for every deal I find? Then my next year, why does it take me a month month and a half, three weeks for every deal I find? It gets easier and easier. What you do is you keep looking.

You take more action to find deals. And then one day, you're gonna say, hey. I I can just work one day and have a deal a month.

Steve: Yeah. Awesome. Very cool. Alright. So we'll wrap up here, guys.

If this was helpful, please like it, share, comment. It helps the algorithms.

Michael: Yeah. Let let me say this too. Yeah. Steve really has his heart in this, and he really wants to help you guys. He wants to show you guys how you can not only better yourselves today, but you can have the dreams you want for tomorrow.

You know, I I I I get invited on multiple podcasts. I flew out, and I did this one because of who Steve is and where his heart's at. So I'd encourage you to listen, like, and subscribe to his podcast.

Steve: I appreciate that. Thank thank you very much. And then, guys, tune in next week. We got Tiffany High coming out from, Ohio. She's gonna talk about how she scaled to 200 a month by focusing on KPIs, which I know is one of those things that no one likes to look at.

Last thoughts.

Michael: When you grow in real estate, you will learn to love KPIs because they vegetables. They save you a lot of money.

Steve: A lot of money. Yes. So what are some last thoughts you'd like to leave the listings with?

Michael: So last thoughts, you know, take massive action. Kong likes to say this, and I told him this years ago, action plus action equals massive actions, then results are inevitable.

Steve: Yeah.

Michael: You know, if you dream it, you can do it. The world you dream of tomorrow, depends on what you do today. And if you take action, you're gonna have it.

Steve: I love it. That's it. If we had a mic that we could drop, we would drop it. Thank you. Gotcha.

So mic to the fifth, m I k e, the number two, t h e f I t Z on Instagram, guys. Alright. Thank you guys for for watching. Thank you. Appreciate you coming up, man.

This is awesome.

Michael: Thank you.