Real Estate Business into 47 Franchise Locations in 23 States

Steve Trang: Everybody. Thank you for joining us for today's episode of Real Estate Disrupters. Today, we've got Matt Lavender with New Again Houses. Matt flew in from Bristol, Tennessee. How about he turned his real estate business into 47 franchise locations in 23 states?

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Alright. So first question is, what was your life like right before getting the real estate?

Matt Lavender: Well, the simple answer to that is I was a college soccer coach. Mhmm. But that story goes back to the beginning. That's this inner intertwined journey of sports and business, and all of it all of it's been transferable to real estate.

Steve: Yeah. I love aspects of sports and coaching and how it translates into real estate. So you were, at that time, when you got into real estate, coaching, college? Yeah.

Matt: Yeah. I was coaching college soccer. I loved it. Like, I think when you're when you're a coach, when you've got that in your when you've got that in your DNA, it's it's there with you. You you can't you can't leave it.

And so, it I I really enjoy I really enjoyed the coaching. The the problem with college coaching is very small part of it's actually coaching. A lot of it is bureaucratic. A lot of it is administrative. Oh.

The recruiting is the recruiting's a lot. Mhmm. But what really what really made me move on to something else was the feeling that I couldn't fully spread my wings without being dependent upon someone else. And so, an athletic director or a middle manager at the at the university, I felt like was dictating my future. And I would imagine a lot of people feel like that in their in their job.

Steve: Right. Yeah. Most people definitely do. That's why I couldn't stick around. Yeah.

So then did you have that feeling and then you pursued something different, or did you find real estate and then you decided it was time for a change?

Matt: Well, the the real estate goes back it it goes back to my childhood, really, because

Steve: I

Matt: I grew up in a small I grew up in a small town. Mhmm. My, I was the I was the first I think I was the first male in my family who didn't go to work at the local factory. And my whole childhood, I was told, you're gonna go to college so you don't have to work at Eastman, which is the big chemical factory there in in in our area. And so that's all I heard that's all I heard all my life.

And so my my father was a he was an entrepreneur at at heart. Like, he had the heart of an entrepreneur, but he didn't have didn't have the opportunity to spread those wings. And so he had, some small businesses. He had a couple of franchises. One of them turned into a into a Dairy Queen, and I saw how hard he worked and how entrepreneurial his spirit was and how happy he was Yeah.

There. But he always told me that the best investment he ever made was buying his buying an apartment, and he lived in half of it Mhmm. And then renting the other half.

Steve: Yeah.

Matt: And that's really how he got started, and I think that's what put him on a path to a middle class a middle class life. And I never I never forgot that.

Steve: So who got out of state? Yeah. Back ages ago.

Matt: Yeah. In the early seventies. Yeah. Yeah. And I I remember him saying that and all the things that he tried and he did, he always told me that that was that was the the most important investment that he that he ever made.

Steve: Gotcha. Yeah. So getting into, soccer, you were I mean, this is trajectory that you have, like, a a soccer did you play a lot of soccer? And then you Yeah. And then once that career ended, then you went to coaching?

Or was this Yeah.

Matt: You you

Steve: do in middle school and you just kinda the the the wins just kinda push you that way?

Matt: Yeah. No, man. Every I played every sport when I was little, like, everything. Football, basketball, baseball, soccer, and played five sports in middle school. So that was that was that was my life.

Like, that was that was where I learned. That's where I learned life. And I learned a lot of life lessons in the baseball dugout, and you learn so much about life that you probably shouldn't know in a football locker Yeah. Around the football team. But I'll, I remember my my fifth grade teacher had a parent teacher conference with my mom, and she says teacher said, Matt's Matt's gotta learn that life isn't just a game.

She was wrong. Well, yeah. I've I've I've been trying to prove her wrong, but I do think she was right. There's there is a lot to life that's not that's not a game. But, so then in high school, you know, your your, heroes and your influences are usually sports.

Mhmm.

Steve: Sports figures.

Matt: Yeah. Yeah. And I think back to, you know, how much those those heroes influenced me and maybe even values and approach approach to life. I was a massive Dennis Rodman fan. And not because of yeah.

Not because of the off the court stuff, but because yeah. Yeah. But, man, the the, relentlessness that the guy had on the basketball court and just the hunger to get the rebound. Mhmm. He was so he was so inspiring to me.

Like, I grew up a Celtics fan, and I remember him shutting down Larry Bird in the in the playoffs. Yeah. Man, those Pistons. That's a great team to watch. And so, anyway, those guys ended up being, you know, you idolize them in high school.

You idolize your you idolize your parents. And then, I went on, went on to school. I majored in accounting Mhmm. Because accounting was just easy to me, and somebody told me that that would be a good career. And then I went all the way through school, did an internship in accounting the summer before my senior year.

I hated that internship. And, like, to to this day, accounting is the least favorite thing I do in my life.

Steve: That resonates with me. Yeah. So so then why what pushed you into real estate?

Matt: Well, so that, when I finished that, I did that I did that internship before my senior year of college, and so, man, I was it's a little too late to change. Mhmm. So I didn't know what I was I didn't know what I was gonna do. So I went to I went to graduate school still not knowing. I fell in love I fell in love with history in graduate school Mhmm.

And coaching. So I had some opportunities at Duke to coach, and it was it it was just just a great great opportunity. So I got into coaching and teaching in graduate school. And then right out of right out of graduate school, I started coaching and coaching and teaching at the at the college. Right.

And so I did that for twelve I did that for twelve years. And, you know, coaching coaching, you just learn so you learn so much Yeah. In in coaching. And part of it is seeing what kids can be rather than just who they are.

Steve: Right.

Matt: Do you see these 18 year olds? It's like, I can see that there's something that there's something in there. Mhmm. And then you spend four years trying to trying to help them

Steve: Right. Tap into it.

Matt: Tap into it. Well, it's not all that unlike what we do now. Right? Like, that's that's the that's the heart of it. But you learn you learn so much because, you know, in coaching, one of the things I miss about coaching is the feedback.

Like, when you're coaching in college, you either win or you lose. Mhmm. And there's a scoreboard.

Steve: Oh, yeah.

Matt: And it's pretty clear whether you've been success you've been successful or not. It's a

Steve: very tight feedback loop.

Matt: Yeah. And then you give an interview after, and you got to explain it. And so you don't have that in business. Mhmm. Like, it's a long term thing.

And so I do miss that about coaching, but it forces it it forces you to pivot. Like, it forces you to acknowledge mistakes. Mhmm. And I think that's one of the things I really learned from coaching and, has been really transferable.

Steve: Yeah. Yeah. So then you did it for twelve years. So why Yeah. Why into real estate?

Matt: Yeah. So we, we started my wife and I had always, just from my childhood knowing that real estate was, was what it was and the opportunity that it was. We started, doing fixing up some rentals, and so I remember our kids would be, in diapers on the floor. My wife would be doing tile work, and I'd be doing whatever. I'm not really useful.

Mhmm. And so but I was there. And so we were we'd fix up a few house a few houses, rent them out on a on a really small scale.

Steve: Mhmm.

Matt: And then in February or in 2007, I realized that I didn't want to continue coaching. I felt like I was living in a I just I explain it as feeling like I was in a box that was too small.

Steve: Mhmm.

Matt: And I wanted I really wanted to spread my wings and build a business where if I succeeded or I failed, it was because of me.

Steve: Mhmm.

Matt: It wasn't because of some vice president or some CFO in an office that was gonna dictate my success or not. Yeah. And so I wanted to build a business. I wasn't passionate about flipping houses. What I was passionate about is building a business that could flip houses.

Mhmm. And back in 2007, there just weren't many sophisticated players out there.

Steve: There were not a lot of conversations about that.

Matt: Yeah. It was just it was a mom and pop it was a mom and pop cottage industry. Everybody was doing one or two with their HELOC. It just wasn't sophisticated. Yeah.

It's like, can can we turn this into a business? And so that's what I've always been passionate about is the is the business side of that product.

Steve: So you already had rentals before you changed careers.

Matt: Yep.

Steve: So you were working as a coach. You were you had assets. They were cash flowing.

Matt: Yeah.

Steve: And so that kind of probably gave you some more freedom Yeah. To pivot.

Matt: It it it did give me freedom, but it it's never easy. Mhmm. Like, that shift, like, I knew I knew that I wanted to transition from coaching full time to doing real estate full time.

Steve: Mhmm.

Matt: Like, I knew there was opportunity in this, but that is not easy. Like, you never you never wake up one day and think, man, today's the day I'm gonna walk away from my W two. Mhmm. Right? Like, you never feel that way, and so it's always it's always a leap of a leap of faith that you just have to make at some point, and I remember, like, how hard that was for me.

And it wasn't just the security of a w two, but I genuinely loved what I did. And when The coaching aspect. The coaching part of it, and even the teaching part of it. Like, I taught history.

Steve: But not the bureaucracy.

Matt: Not the bureaucracy. Yeah. And and I just felt like yeah, I needed to do something. I needed to do something new. I needed to build something that was mine.

Mhmm. And I also realized during that time, I wasn't building something for me. I was building it for somebody else.

Steve: Yeah. And this really resonates with me.

Matt: Yeah.

Steve: Right? Because for me, I did enjoy the engineering part. I did. Yeah. But only the engineering part.

Yeah. Right? But I didn't care for being told how to do my job.

Matt: Yeah.

Steve: Right? And I also knew whether I worked twenty hours a week or eighty hours a week, the paycheck was the

Matt: same. Yeah.

Steve: And so for me, when people were asking me, like, why are you quitting such a great cushy job, right, with great benefits is, like, I I would rather work somewhere where if I fail, I make zero. Yeah. But if I win, I win big.

Matt: Yeah. Right?

Steve: So that was that was what what was inside me. So when you're talking about, like, you know, like, you cornered in and this box is just getting a little too small, like, that's kinda how I was feeling

Matt: Yeah.

Steve: Most of my career, when I was at Intel.

Matt: Yeah. But it's hard to leave. Right? Like

Steve: It wasn't hard for me only because for myself personally, young, single, no responsibilities. My only responsibility was my mortgage payment. That was the only responsibility.

Matt: Yeah. That that makes it easy. Yep. Most people don't most people aren't in that situation. Like, I had we just had our third we just had our third child.

Steve: It's a lot harder when you got kids.

Matt: Yeah. You're not making that decision just for yourself. You're making it for people who didn't sign up to be an entrepreneur and take take risks.

Steve: I remember when I the the last day when I was walking out, so many of my fellow engineers are like, we're envious. We're jealous. Like, we wish we could do this. Yeah. But we can't.

Right? We they got the golden handcuffs.

Matt: Yeah. Yeah. And it's it's it's sad. You know, it's sad in a way because the the window the window doesn't stay open forever. Like, the longer you stay there, especially in that field, the longer you stay, the harder it is the harder it is to leave.

But I I also you know, looking back, once I realized that I wanted to do something more, that, like, my ambition was different, I started to resent that job. Mhmm. And once you begin to resent something, you're never you're never gonna be happy with it. Like, that never I found when you start resenting it, like, there's no there's no moving forward with it. Yeah.

Yeah.

Steve: Well, another thing you talked about is, like, you didn't want to flip. You wanted to build a business. Yeah. Flip. That's not a language.

That's very common back in No. O seven. Right? But, again, this resonates with me. Like, I'm not trying to make the show about me, but, like, the joke I've made is I love everything about real estate except for houses and people.

Yeah. Right? Like Yeah. I just wanna own a business that's super profitable with high margins. Yeah.

Real estate just happens to fit that box. Yeah. Right? So I I love that you're saying, like, this was your thought process. Yeah.

So you submit your notice. What? Is it o seven?

Matt: Yeah. But it wasn't that instantaneous. Like, I I real I did, like, two jobs those last two years. Like, I realized in 2007 that I wanted to move on, but I didn't actually leave until 2010. And what I was doing is I was working during the day Mhmm.

Coaching and recruiting. That's a really consuming profession. And then at night, I was digging. Like, I was I was burning the midnight oil every Getting

Steve: to the bottom of your purse.

Matt: Every night. Yeah. Just because I was I needed to get this going. I needed to get enough momentum Mhmm. To where I could I could leave without having the risk.

Yeah. And it was it was tough. Like, it was long, exhausting hours, but I think people sometimes have to go through that unless you've got a big nest egg.

Steve: Yeah. No. You've gotta go through the the suffering season.

Matt: Yeah. It

Steve: doesn't work if you don't suffer. Yeah. Yeah. So you talked about recruiting. What what where where were you coaching?

Matt: At, King King University

Steve: King University.

Matt: In Tennessee.

Steve: So we had a a conversation some time ago, you know, the last couple of months. Like, Deion Sanders has been all over the Yeah. Right? It's the sports

Matt: pages. Yeah.

Steve: And someone was saying, like, he's a great coach and great leader, this and that. My opinion, and I'd like to get your opinion, is because you Yeah. You've lived that world

Matt: Yeah.

Steve: Is I'm not discounting his ability to coach or his ability to lead. I'm not discounting any of that. But my argument is that he's just the best marketer. Mhmm. Right?

Recruiting is getting people to raise their hands. Recruiting is is inspiring people to want to follow you. So I'd like to get your perspective on that on my perspective.

Matt: Yeah. I think recruiting college athletes is very similar to sales and anything else. Mhmm. And it's about being about telling a story. But it's not just telling the story, it's about having a big enough vision Mhmm.

That people wanna be a part of it. And I think he's really good at that. Mhmm. Like, he thinks he thinks big. He draws a picture of what he wants this to be, and then he tells a story, and he's he's gotten talented talented 18 year olds

Steve: Yeah.

Matt: To wanna be a part of

Steve: it. Yeah.

Matt: So I think I think the the the this being a being a gifted storyteller like he is it's hard to separate his recruiting ability from his leadership ability. Mhmm. Because I I I what I sense is the kids that he's got there. Once you recruit them, you still have to inspire them. Yeah.

Right? It doesn't get easier No. When you get

Steve: That's just step one. Yeah.

Matt: You get, like, he's got, what, eighty eighty type a, 20 year old men in a locker room. Like, it doesn't get any easier. Mhmm. And so that that now it's then it becomes like recruiting them to to play off the same playbook Mhmm. To to and so the recruiting never it never ends.

Steve: So in the recruiting component, how much has that translated into running a business?

Matt: Man, it's it's there's so many overlaps with coaching and business. I think coaching is a lot teaching. I've I don't think I've ever seen a great coach who wasn't also a gifted teacher. I think that's what separates the great coaches is they're they're really good teachers. Mhmm.

And I think that's so When you

Steve: say teach, do

Matt: you mean,

Steve: like, teaching concepts, teaching life lessons, teaching the development of a play? Like, what kind of teaching are we talking about? I

Matt: think all of those you know, some coaches are better at some of those than others, but I think back to the best coaches that I've had, they were able to teach the fundamentals. Mhmm. They were able to they were just really good teachers, and you see guys at the highest level, and they just have that ability. And it's an empathy. It's a leadership.

It's just this teaching ability that not everybody has. Like, you think about the average coaches. They they might know their sport, but they're not great teachers. Mhmm.

Steve: You

Matt: know? And so, I think that that ability to teach is important for for coaching. But in business, like, if you're building a business that is bigger than yourself, right, which is what, ultimately, I think we wanna we wanna do is build something bigger than ourselves. It's probably why you wanted to leave your engineering

Steve: Yeah. Job.

Matt: Right? You wanted to build something bigger than you. If you're going to do that, then you've got to teach at some point. Mhmm. And teaching, I see teaching as empowering other people

Steve: Yeah.

Matt: You know, and empowering them, trusting them to to spread their wings. And hopefully, if you do it well, they end up doing it better than you. Yeah. So I I jumped in this real estate thing with flipping houses, and I learned it. I I just dove in.

I'm I am not I I don't have skills myself. I am not a contractor. I'm not useful with a hammer, but I learned the business. I learned the numbers. I learned what pieces you need to flip a house, the people that you need to flip a house, how the numbers how the numbers work, and I tried to create, tried to create systems Mhmm.

Around that so that I could build a business that didn't depend on me. Yeah. And so, that's been that's been a process, and we do we do 30 houses a year now locally just in our in our own corporate headquarters, and they don't let me near a house. Like, I haven't seen a house since before COVID. Yeah.

And if I get if I go near one, they start throwing stuff at me. Because I would just get I would just get in the way.

Steve: Just get out of here.

Matt: But they have become better at it than me. Right. Like, every facet, they are better at it than I Well,

Steve: I love what you're talking about here as far as teaching. The ability the difference between great coaches and the and the not so great coaches is the ability to teach. Something that we've been harping on recently is we're moving away from a learning organization to a teaching organization. Right? Because if we're teaching the lessons, there's a greater amount of responsibility and ownership from the leaders.

Yeah. Right? If I'm if there's a learning organization, you go learn what you learn. I'll go learn what I Mhmm. Maybe we do a book club, whatever.

Right? Yeah. But if it's a teaching organization, then the expectations once I teach it to you, examining, are you getting it? Right? Are you getting it?

Are you committed to executing it? Yeah. Right? So there's a greater onus on on the owners if it's a teaching organization. Because now the expectation is not just here.

Here's the login. Here's the course. Here's the book. Alright. Get out there and go crush it.

Yeah. Now it's like, this is there's feedback here.

Matt: Yeah. I'll I mean, I like that. And, you know, going back to going back to coaching and and Dion, like, if he doesn't teach it well, there's it's not just the it's not the player's problem. Right? It's it's his problem.

So he's he's invested. And I do think I do think that a lot of our learning learning platforms today have become so transactional Mhmm. That there isn't that long term that long term relationship.

Steve: Yeah.

Matt: And so when we started doing, franchising, you know, franchising is coaching. Like, I didn't realize that when I got into it. Like, I just didn't understand. But franchising is all about it's all about coaching. Mhmm.

And so you have to learn how to teach at at scale. Yeah. And,

Steve: Well, we need to transfer all the knowledge base Yeah.

Matt: Out of your head. Man, franchising, that was that was the hardest thing, because when you when with a franchise, you have to be able to explain what you know to a stranger Mhmm. And do it efficiently and at scale. Right? That's that sounds easy.

That is not easy because you don't realize how much is in your brain Mhmm. Until you try to explain it to a stranger.

Steve: Yeah.

Matt: Like, even things like, what do you what do you call like, terminology. Mhmm. Right? So there were three of us in the office when we started franchising, and we would have terminology that was loose. It was vague.

Like, we might call it one thing one day and one thing another.

Steve: Yeah.

Matt: That doesn't work. That doesn't work in franchising.

Steve: ARV, market value, retail. Which one are we talking about?

Matt: Yeah. So it forces you to, like, really understand your own your own knowledge Mhmm. And give everything a name, and the formulas have to be the same here as they are there Mhmm. And then teach them.

Steve: Yeah. Yeah. Language is one of the most important tools. We don't really recognize it. It was one of the most important tools for communicating.

Matt: Yeah. Yeah. Like and if if but it's work. Like, it is it is work because so much is so much that we have accumulated, especially when you're when you become good at something. You just take so much for you know?

Or you become knowledgeable or an expert on something.

Steve: You just expect someone else to get it.

Matt: Yeah. And you you take it. You you take it for granted.

Steve: Well, I mean, before we go back to your journey. Right? Like, we're talking about the ability to empathize and teach. One thing we talked about is, like, you know, why I feel qualified to be a sales trainer is because I just tell everyone because I was awful at it. Right?

Like, Michael Jordan tried coaching. He wasn't very effective at coaching. He couldn't teach it Yeah. Because he couldn't empathize Yeah. Why they struggled.

Yeah. I mean, do you do you believe in that? Like, that's that's what I've said. I'm just interested in what your thoughts are on that.

Matt: I think if you I think there are people that were are born teachers Mhmm. That it comes a lot easier to them.

Steve: Yeah.

Matt: I think it's a very difficult thing to learn, and I think it's it can be learned, but I think it takes a lot of work and commitment to learn how to learn how to do do that if you're not good at it. Yeah. It's just because teaching is so much about seeing the world from someone else's perspective. Mhmm.

Steve: You

Matt: know, like, the that's where the that's where the empathy part of it

Steve: Yeah.

Matt: Empathy part of it comes. And Michael Jordan, I don't think empathy was ever his strong suit. Right? He

Steve: was not known for most most empathetic, most empathetic player of

Matt: the year.

Steve: Yeah. Yeah. Empathetic player of the year. He was never won.

Matt: No. Never won. Never won that one.

Steve: Yeah. Another thing too before sorry. I apologize. Just keep adding these things. Like Yeah.

I'm really appreciating this conversation. Yeah. The the part about being able to download what's in your brain. Like, there's a running joke. Matthew Potter and myself, he's a host of Pardon the Disruption.

Running joke is, like, the first person that can figure out how to download everything in your brain Yeah. Can be a billionaire practically overnight.

Matt: Yeah. Right?

Steve: Just all that tribal knowledge, all that experience

Matt: Yeah.

Steve: How to deal with this problem, that problem. Like, we've seen the problems.

Matt: Yeah. But we can't Yeah.

Steve: Teach all those things.

Matt: But if you, like, if you picture that, like, if you could do that tomorrow, you could, like, download all the information, and it it wouldn't be helpful. It would be like drinking from a a fire hydrant. Right? Not a fire hose, but a fire hydrant. Like, if you could download everything that you know in your brain and dump it on me right now, like, what would I do with that?

Right? And so it's it's much more it's much more difficult problem to solve than that. And so the way that we've tackled it and franchising forces you to do this, and the typical thing that franchises have done historically is they'll do an operations manual. Right? And it'll be 300, 400 pages.

Yeah. And then you invite your new franchise your your new franchisees in for a weekend, and you teach them everything. Right? Mhmm. Well, that's the that's the data download.

Well, it doesn't work

Steve: Right.

Matt: Because, I used to teach history, and I remember it was a six hour course. It was Western civilization, like, all of Western civilization in six hours, like, over the course of a year. Alright. Well, that was tough. Well, then they got the bright idea.

Well, we can be more efficient. We can do this in one semester. Mhmm. So they jump it in one semester. Well, you can't learn that way.

No. Like, you you it takes time. Like, things have to have to marinate. Mhmm. And I think the hardest part with real estate is you learn by doing.

Steve: Yeah.

Matt: Right? You can't just learn from information. You really have to do it in order to learn, and so that's one of the challenges that we've been trying to solve. And so we've created this kind of interactive, interactive process for teaching, where we teach we teach from a lot of different mediums. And so some of it's written, but it's written on, a a digital platform where they get bite sized pieces.

Mhmm. And so we call it the flip simulator. And so we teach flipping, but I I call it like breadcrumbs. Mhmm. Like, we give them little bits at a time, learn that, and then you move on.

But it's not just words. There's also, like, simulations where you walk through a house, and you you evaluate it, and then small group sessions and large group sessions, one to one coaching. Like, it takes all of those all of those different things. Right? If you go back to coaching, like, you can't teach someone to play football out of a manual.

Right? Like, it's the team teaches them how to play play that to play at a high level, but you've got position coaches that do small group, and you do technical, you do tactical, you do the the film room, you practice, you play. Like, all of these different inputs are required to teach someone to do something at a high level. Yeah. And that's a real like, it's a real challenge.

Steve: It is. So let's go back to your story. So you decide so you worked for three years to build up reserves Yeah. So you can so that you can Yeah. Go and and do your thing.

So 2010, you you quit. Yeah. How long from when you quit till you realize you had the franchise or you were gonna start a franchise?

Matt: Yeah. And and that quitting, the the it wasn't just financial. Like, when you're a coach, like, that's your identity.

Steve: Yeah.

Matt: Like, maybe I'm sure engineering was part of your identity.

Steve: It was.

Matt: But, like, people referred to me as coach. Like, all of my relationships was a coaching relation. Like, it was it was hard to walk away from that, just from that part of it. But when I did, we started we started, flipping houses. We're in we started in a small area, and we started we were up to about ten, fifteen, in our in our town.

And then,

Steve: 10 or 15 ongoing flips or lost? 10 or

Matt: 15 flips. Yeah. Yeah. We just started flipping. Like, we've accumulated some rentals along the way, but for the most part, we're we've we've been flipping through these years.

Mhmm. And so, I brought in somebody year one, to help me, and he became my right hand person. He's fantastic. He's been with me. Sam Ferguson has been with me from the the very beginning, and he's still with me in in driving driving

Steve: the franchise. Sam was with you.

Matt: Yeah. Yeah. So this was, like, 2011. Mhmm. So I took a I took a when I sorry to go back to this transition, but I think people I think those of us on the other side of that, like, when we've gone full full time with something that we're passionate about and we have the we have the privilege to do something that we're good at full time.

I think we take for granted, like, how hard it is to make steps, like, to get there. You know? Like, going back to that time, those first steps toward that. Like, but they're hard, man. Like, emotionally, risk, financially, all of that.

And so I remember I came I I set up a home office, and we just had our third child, and it was an open open floor plan. Right? That's all the that everybody's building an open floor plan in 2008 or whatever, and that's what we had. And so I set up my office right there in the middle of the house, and it was it was January. Things went alright, and then spring break came.

Mhmm. And I'm trying to do deals and three kids running through the house Yeah. With no walls. Like, I I learned to appreciate walls

Steve: Mhmm.

Matt: That that summer. I was like, I can't do this from home. Like, I'm not wired this way. So we we bought an old, roofing shop that was about 300 square feet plus a garage. And I renovated that roofing shop, and it was just big enough to put four desks in there.

Mhmm. But I was the only one, but I put four desks in there knowing that my goal was to fill to fill that little roofing shop up because I wanted to be bigger than me. And so Sam Sam came. He he trusted the vision, and, he was one, and we we filled that up.

Steve: Yeah.

Matt: And then we began expanding to, towns about thirty, forty five minutes away. And when we did that, it forced us to to really tighten up our systems and our processes. So really process based, we try to turn a flip into a math problem. And, but there's people involved, so it's not always just a math problem, right? But we started doing flips in neighboring areas.

Well, what that changed is now you can't be on-site for those flips. Mhmm. Right? So now your terminology has to be better. Mhmm.

You have to now you really have to empower the contractors Mhmm. Because you can't be there to manage them. Right. And so we that experience forced us to tighten that up. And so even though they were only forty five minutes away, it forced us to to make our systems and our processes better.

Well, we kept we kept building that out. It eventually became software, and so that those systems and processes really became too big for what we were doing locally

Steve: Mhmm.

Matt: And franchising just made sense. And so in 2015, we started that journey on franchising.

Steve: So you quit in 2010, and then you franchise in 2015.

Matt: We started we started thinking about franchising in 2015. So you we had to build that out. Mhmm. So there's the legal. There's turn and and again So

Steve: I wanna get into that later on. So before we do that, so you decide to go. Mhmm. When you quit Mhmm. How many flips were you doing at that time?

Matt: Oh, gosh. I was probably doing, maybe three, four a year. Okay.

Steve: So you're working from three or four to 15 ongoing. Yeah. Okay. So, we talked about the challenges being at home, open concept. Yeah.

I mean, I can speak for myself. My first my some of my challenges was I was completely directionless. Mhmm. Right? Because, like, when you got a job, you know where you're supposed to be Yeah.

When you're supposed to be there, what you're supposed to be doing Yeah. While you're there. Mhmm. Once I was on my own, I was just kinda like I was doing things. Yep.

But were they income producing?

Matt: Yeah.

Steve: Were they the right activities?

Matt: Yeah. You

Steve: know, am I talking to the right people? Right? There's all these things, challenges I had. So what were some of the biggest obstacles besides an open floor plan?

Matt: Well, it's what I think what you're talking about is is structure, really. Right? Like, when you've got a job, there you have structure imposed on you. Right. And it's something that a lot of us, like, push push against.

Right? But it's important. Like because when you go when you're sitting alone sitting alone in a or in a remodeled roofing shop Mhmm. Like, you have to you have to start managing your time. Mhmm.

And that's not easy because you and and you're at the beginning of a business. You don't really know what's important, So you're making that up. You're making that up as you go, trying to manage your own time, and we tend to do things that we want to do Mhmm. Rather than what we need to do. Yeah.

And I think one of the the biggest villains for entrepreneurs is the urgent. Mhmm. And when you're in that situation, like, everything's urgent. And when you're doing the urgent will consume the important. Yeah.

Right? Absolutely. And if you don't and but you it's hard to know that when you when you're getting started with something. Like, so much of this I've learned over time, and I think I think we're really I think we're really bad at managing our time, like, all of us. And one of your recent guests, I think it was I think it may have been Trevor Mhmm.

Talked about that he wasn't disciplined.

Steve: Mhmm.

Matt: And he said he imposed, like, he imposed a structure on on himself Mhmm. And he didn't take any meetings before 11:00. Mhmm. I started doing that a few years ago.

Steve: Yeah.

Matt: But it it's structure. Right? And you don't have that when you're starting out and Right. Makes it it it makes it tough.

Steve: For sure. Yeah. What are some other, like, big challenges, things you'd not expect at that time?

Matt: I would say loneliness. Like, you're making big decisions Mhmm. And, like, there's no one there's no one to talk to. That was before online communities were, you know, a a really viable viable thing. And so you're making these big decisions.

There's a lot of pressure.

Steve: A lot of money on the line.

Matt: And and it's lonely out there. Mhmm. Yeah. And you're you don't have friends who are going through this. Right?

Like

Steve: I wanna share your your your sob stories with

Matt: you. Yeah. But then it's also, like, in in flipping in particular, like, there you you need to and and this is really this has influenced the way we've created the the franchise, is you, you have to do enough volume to create competitive advantages Mhmm. But you can't you're limited on your volume because of your capacity. Right?

Your systems are limited. Your capital is limited. Your what we call it, construction ecosystem is limited.

Steve: Yeah. Your

Matt: everything is limited, but you've got to establish enough volume to where you can create some competitive advantages because it's competitive out there.

Steve: Right. Super competitive. Yeah. Yeah. So

Matt: I would imagine the same is true with wholesaling.

Steve: Oh, absolutely. Like Absolutely. You gotta create your competitive advantages. So you said you wanted to create a business that flipped houses. You don't wanna flip houses.

Yeah. What kinds of questions were you asking yourself with that mindset? Because not everyone starts a career with that mindset. Right? Everyone starts off like, I wanna do this.

Mhmm. And then it's like, oh, I actually don't wanna do this. Yeah. I wanna do this. Yeah.

Right. So you went in there intentionally. Well, I wanna build a business that flips houses. What kinds of questions were you asking yourself to go in that direction? Well,

Matt: a a couple of things. I I think the the easy part for me is I didn't have the skills. Like, I think a lot of people in that situation would be tempted to grab the hammer Mhmm. And jump in there and and get in the in the business. That wasn't an option for me because I wasn't I wasn't skilled.

So I had to build a business if I was gonna do this. Mhmm. Mhmm. There are things I could have done, outside of real estate, but I was pretty strategic on picking real estate because, I think the product is important. If you're gonna build a business, the product is important.

And I see a lot of talented people, like, talented salespeople that pick the wrong product. Like, they pick a low margin product Mhmm. That sets them up for failure. Like, why would you do that? Yeah.

Right? Yeah. And so but I think the same that that has always attracted me to real estate. And it goes I think it goes back to seeing my parents in the small businesses that they had. Like, they had a t shirt shop and a popcorn shop and a ice cream and shoes, and I just saw them work so hard, and they were so talented.

Steve: Mhmm.

Matt: But the product, like, it's tough, man. Like, those are tough products. The margin just isn't there, especially in a in a smaller town like we were. So I saw them, like, work so hard for every dollar.

Steve: Mhmm.

Matt: And I I didn't want I didn't wanna do it that way. And real estate is unique. And, you know, everybody knows that most of the millionaires that you come in contact with, they probably made it through real estate. Yeah. Why?

Because you can leverage real estate. Mhmm. Right? I didn't I didn't have I didn't have money. But if if I tried to do this with shoes, no one would have loaned money against shoe inventory.

Yeah. Right? But real estate's different. It's unique it's unique that way.

Steve: You know, it's, there was a there was an ice cream shop in Downtown Chandler, not that far from here, Sammy's. We loved it. Yeah. Right? And one day, it just shuts down.

And I remember when I was there Yeah. It's like there's no way Yeah. This place stays in business. Yeah. There's just no way.

Yeah. Right. I'm paying $34 for ice cream sandwiches Yep. For me and my wife, my three girls. Not a lot of revenue.

And then they're teenagers, so so they operate with the efficiency of teenagers. Yeah. Like, it's not a franchise. Yep. So they operate with efficiency of teenagers.

So, like, it's taking, like, ten, fifteen minutes Yeah. To get $20 from me. Yeah. And I'm just looking around all these expenses, and, like, there's no way to say it's in business. So I remember when it went out of business, the, one of my daughter's teachers was, like, sad, and, you know, she liked it as well.

So I had I I sat down with my daughter. He's like, why do you think it went out of business? She's like, I don't know. Maybe it wasn't that pop. It's like, okay.

So let's remember when we were there. Yeah. Remember how long it took?

Matt: Yeah.

Steve: How much revenue we're generating? How much do you think those teenagers are making? How much do you think the lease is on a space like this? Yeah. Let's talk about the utilities.

Yeah. Right? So, yeah, to your point, like, why would you sell a low margin product? You're setting yourself up for failure.

Matt: Yeah. And low margin products usually have to come with high volume.

Steve: Must come with high volume.

Matt: That's more people. Yeah. And the more people, the harder the harder it is. Right? So

Steve: yeah. Yeah. Yeah. So in five years so when you last had conversations and thoughts about starting the franchise, you said in 2015. It was at that point you were flipping 15 houses at a time?

Matt: Yeah. It was it was about that. It was between fifteen and twenty. Okay.

Steve: So what was the question you were asking yourself where the answer was, I need to franchise this?

Matt: I think we we had I felt like we had built such robust systems and processes, and they were really, like, they were really good. Mhmm. But they were built on spreadsheets, like, really intricate spreadsheets, but they were good. And and we we we were getting pretty good. We were getting pretty good at this.

And, but the sis it's almost like we'd built this foundation that was bigger than our market.

Steve: Mhmm.

Matt: And it was like, I didn't feel comfortable scaling our business much further in our small market just because of the just because of the risk of having so much so many houses in one in one market. But then we had this asset of all these processes, and so it just it, Mark Pate came to me, and he said, man, I think you need to I think you need to franchise this. Mhmm.

Steve: Who's Mark?

Matt: So Mark has headed up our capital fund. Mhmm. And so that's a that's an important piece of this, and so we've created a a capital fund that helps our our franchise owners on on the capital side so that they can scale their business. So he's the one that came up with that, with that idea, and I fought it for probably a year, and then we finally started, started the process with Mhmm. With franchising.

And and that like, people go into franchising thinking they're gonna take the business that they do, and then it's just gonna be an extension of that. Mhmm. What they don't understand is that being a franchisor is a completely different business.

Steve: Yeah. In what way?

Matt: So, like, the the new again houses local, the the development side of it, the the part that's flipping houses, was it had it it was good at what it did. It was good at flipping houses. But to be a franchisor, it's not flipping more houses. Mhmm. It's becoming a completely different role.

Mhmm. So now you become a teacher. You become a coach. You become all of these things that, as a friend, it has nothing to do with what you were good at Mhmm. Flipping houses.

And so, fortunately, they didn't need me to flip houses. So Sam Sam is really like, Sam's really good. He's better at it than me. Annie came in. She she's became better at it than me.

And so they had they were able to continue that business, and because I hadn't put myself in the middle of it and made myself expendable, then it allowed me to really throw myself into building the franchise. Yeah. And so they continued that. They continued the work of and then I just really went all in on building the franchise.

Steve: Which is really what you love to do anyway, Coaching.

Matt: It is. Yeah. Like, I didn't love flipping houses, but I do love coaching.

Steve: Yeah. And so, like and that's in myself as well. Right? Like, someone's asking me an event of the day. They're like, why do you coach?

Right? Because everyone I think the perception is that you coach for money. And I'm not saying the money is bad.

Matt: Yeah.

Steve: Right? I'm not complaining about the money. Yeah. But I coach because I love teaching. Yeah.

I love serving. I love watching people take a concept. You see a light bulb go off. You see them go make this change. You can see the changes that's occurring in their lives.

Matt: Yeah.

Steve: It's so fulfilling and rewarding. So I wanna ask another question here. You decided to franchise. Mhmm. I have a couple of peers that also own franchises.

Mhmm. And when I've seen that model, I was like, man, that's brilliant. I've been an idiot for doing coaching versus franchising all these years. Mhmm. So I wanna ask you, were there conversations between franchising versus coaching?

Matt: Yeah. I I am not a, I I it's a good that's a good question. I'm trying to think I'm trying to think back to that. And I think we looked at different options for, for that space, for flipping houses. If we were just transferring knowledge, then coaching would have been an option.

Mhmm. And at at that time, there were there were several gurus

Steve: Mhmm.

Matt: That were out trying to teach flipping, and part of what we were doing is kind of a reaction against them.

Steve: Mhmm.

Matt: Like, we didn't wanna be because it wasn't quality, and we didn't want to just be we didn't wanna do that, and so we wanted to go all in on on franchising and and do it do it by the book, be able to have have royalties. And, you know, looking back, I think probably could have made a similar influence by by coaching. Mhmm. I don't know that I have the personality. I don't know that I have, like, the skills that you have to promote myself as a coach.

Yeah. Because that's a skill set. Right? And and I think we have to understand and there's so many it's actually a good question because there's so many different ways that you can make money in real estate.

Steve: It's nearly unlimited.

Matt: Like, you're talking about making however many million millionaires. Well, there's a lot of different ways Yeah. To to become a millionaire in this space. Mhmm. And getting good at sales is probably the key to almost all of them.

Like, you need that's a common denominator. But if you have those skills if you have those sales skills, there's a lot of different ways to do it. And I think I think it's really important to understand what you're good at. You know? Like, what your skill set at you what your skill set is.

If you're good at some things, you're probably not good at others. Right. And so what makes you a good coach and have been able to create this platform and this audience, I don't think I have those skills. And so for me, I had to do it from a franchise perspective because I don't put myself out in front of it. Mhmm.

So I I don't so I can do it from the I can I can create these processes? I can coach, almost from from the background Right. Which which fits it it just fits my my skill set.

Steve: That's actually my persona as well. Yeah. But I had a mentor. Alright. Darren Hardy.

Matt: Yeah.

Steve: And, asked him this question specifically. Right? We were at his event, two and a half day boot camp, and he was like, you gotta be the face of the company. Yeah. You gotta be like, the company needs a face.

Company needs a face. Yeah. And it was not you. It's gotta be somebody else. Right?

And I was like, well, I don't know who else I would wanna put as a face. Yeah. But I don't wanna be the face. Yeah. So I asked him, like, hey.

You know, like, I don't wanna be the face. Like, you know, but I don't have anyone else. I think I should be should be the face. Like, what do you think? And, basically, his answer was

Matt: too bad.

Steve: Right? And you want your business to be successful Yeah. Either you need to be the face, you need to pick someone else. And if you can't think of anybody else Yeah. It's you.

Matt: Yeah. Yeah. So how long did it take you to work through that?

Steve: Not too long. Only because once I know the path to victory I I can quickly adjust my my my direction. In fact, my downside probably is not the ability to change direction. My downside is probably I change directions too often. Right?

Yeah. The ability to take something to its eventual end is probably my greatest weakness. That's why I have so many people around me because they're all great Yeah. At finishing Yeah. These ideas in our heads.

Matt: Yeah. Yeah. No. That makes that makes sense.

Steve: Yeah. Okay. So you decide the franchise. What was talk to me about franchising. Let's just say Yeah.

I decide I'm gonna start a real estate disruptors franchise.

Matt: Mhmm.

Steve: What's involved in creating a franchise?

Matt: Yeah. So I've I've been absorbed in the franchise industry now for for several years, and, I've I've learned so much from the franchising world because it's much more it's just a much more mature business Mhmm. Than, like, anything like, the the real estate business that we're in. Yeah. Because like we said, like, in 2007, this is a mom and pop industry.

There's nobody sophisticated in real estate investing. I mean, Carlton Sheets and a few others maybe back then that were out there. And but franchising, like, that's a really mature business. Like, there's a lot of history and data and expertise, generational knowledge in in franchising. Mhmm.

And so being able to be around that and and tap into that has been has been really has been really useful. But I think everybody everyone underestimates all that has to go in to Right. To a franchise. And so it starts with it starts with the legal because it is it is very regulated.

Steve: Mhmm.

Matt: And coming from the real estate industry, which is not that, like It's Wild West. Yeah. So you we take that for granted in real estate, though. Right? Mhmm.

Like, in in franchising, it's not like that. Like, you have to have your, franchise disclosure document. You have to, there's just so every state has has different things, and so you've gotta manage all of that. And then there's franchise attorneys that are really good at that, and then the way you sell a franchise is regulated. So there's certain things, like, there's a lot of certain things that I can't say Mhmm.

Because it would it would cross that line. So, there there's there's the whole legal part that takes quite a bit of quite a bit of time to work through. Mhmm. And and it's like any other business, but, like, that you're you're creating those documents when you don't really know what they should be. Yeah.

So there's a lot of ways to get that wrong Mhmm. In the beginning. And so there's the legal part, but then there's the things that you take for granted, like the things we talked about before. Like, the things that are in your head that you think are common sense, they're not common sense. Right?

And so you've gotta name them, and then you've gotta create a a platform for people to learn it. But then there's also just the the responsibility. And I know you feel this with coaching as well. Yeah. People invest in the coaching program.

You take ownership in that. You feel responsible. And so we feel such responsibility for this for this franchise community that that we have. And so you're constantly trying to invest in the system and making it better. And so there's a lot that everybody that starts a franchise underestimates the time that it takes and the and the money that it takes Mhmm.

To build it out. Yeah. Because you think it's just an extension of the business you're doing.

Steve: Right.

Matt: It is a completely different business.

Steve: Well, this is like, you know, the e myth, right,

Matt: where she

Steve: talks about, like, well, I love baking pies, so I'm gonna start a pie store. Yeah. I'm gonna start a bakery. Yeah. Right?

It should be easy. The skills should just translate.

Matt: Yeah. Yeah. And then she becomes a franchisor, and she's not making pies at all.

Steve: Right. Exactly. So when you're selling Yeah. You're no longer selling that. Yeah.

Yeah. So, can you say roughly again, if I were to start a franchise Uh-huh. My understanding, the limited research I've done

Matt: Yeah.

Steve: Right, it's, like, 30 to 50 k to get it even just approved by the federal government. Yeah. Right? Yeah. That's not even, like, before selling it or Yeah.

Or getting the financing or the, yeah, I guess it's just just money wise. Like, before we even try to sell anything or even talk about, hey. I'm doing this.

Matt: Yeah. That might get you that might get you the document that you can file at the federal level.

Steve: Right.

Matt: It's probably not the right document. It takes a lot of it takes several versions to get it right. There's just so many ways you can make a make a mistake, and a franchise agreement is a it's a ten year it's a ten year agreement. Mhmm. So that first franchise agreement that you make, like, that's bonding for ten years.

Yeah. So, that part of it that part of it's it's it's difficult. Mhmm. But then there's just the the systems, and you're right. Like, the sales process is is not inexpensive because your salespeople have to understand franchise law.

Steve: Right.

Matt: So, yeah, it's it's it's a lot. And, like, I think,

Steve: you know,

Matt: it's it's a lot of, it's a lot of the bureaucracy that we probably ran away with to start with.

Steve: But this bureaucracy we have to put up with. You can't get around this one.

Matt: Yeah.

Steve: Yeah.

Matt: Yeah. Yeah. But it's also it's also really rewarding. And, you know, it it's it's been so much like coaching. Like, there's just so many transferables between, between the the coaching of sport and a a franchise.

It's a community. You're really invested in one another's success. Mhmm. Like, we chose to have protected territories, which is not usually the case in real estate franchises. Mhmm.

Like, you you the typical model is you'd sell as many as you could in Atlanta or Nashville. We wanted to have protected territory. So our protect our territories are usually 500,000 people. And we did that because we didn't want our franchise owners competing against one another. Mhmm.

We wanted to build a community where their interests were aligned. Yeah. And so, that part of it has probably been one of the more rewarding parts, is every time you bring in a new franchise owner, they bring they bring something with them. Like, they bring an expertise from a different career, and they make the system better. Mhmm.

Steve: Tell me about the first franchise you sold. So twenty fifteen, you have a conversation. Twenty sixteen is legal. Tell me about the first one that signed up.

Matt: Yeah. So we did a pilot, and so we had, we had a a guy, a a recent graduate, Eric Wilkening, who interned in our office during school, and then he started working for us. And so he really learned the business. Mhmm.

Steve: We

Matt: thought, let's set him up in Charlottesville, Virginia, and, let's trial this. Like, by him doing it, we'll learn where the weaknesses are. And so we did that we did that for about a year. Mhmm. And we learned a lot.

He gave great feedback. He helped us with he helped build a lot of the processes, and so that really helped. And then the next year is when we launched, and so that's when I think we had four him plus four other people Mhmm. That that came in that year. And that year, we we did the whole manual and a weekend in the office drinking from a fire hose.

Mhmm. And it didn't work.

Steve: Well, yeah.

Matt: Yeah. Like and so we, quickly pivoted to a different approach, and that's when we started building out the, building out the the training the training part of it.

Steve: Yeah. So, you know, if I'm a prospect Mhmm. I guess before we do

Matt: that Yeah.

Steve: How do you find people that are interested in buying a franchise?

Matt: Yeah. So the persona you know, one of the things with one of the things that I've learned in marketing is that you really need to have a persona. Like, who who is your target? Who is your target for this? And that that's tough in franchising too because you really don't know Mhmm.

In the beginning, and we were surprised. Yeah. Like, our our assumptions or reality's different than we assumed. Imagine that.

Steve: What did you think it was gonna be?

Matt: We thought it was gonna be really analytical people Mhmm. That would do it part time Mhmm. And as as they transitioned out of a job. Mhmm. And what we found is the analytic the analytics wasn't as important as the sales.

Mhmm. And so, so it was, you can teach you can teach the math. Mhmm. Right? Like, the software is really good at that.

Steve: Like,

Matt: you can put you you can put guardrails, for people. You don't have

Steve: to teach the math. You just have to make it so they can screw it up.

Matt: Yeah. Yeah. Which is where the software comes in. Yeah. It's it's not easy, but that's where it comes in.

But but it's the, it's the relational skills, the, the the the the sales skills. Mhmm. We we recently we've just now had enough, of a history because it's still a young system. Like, we're our that group, that first group that came in, I think they're in their fourth, third or fourth year. And so we just now had enough history to be able to go back and say, what are the characteristics of our of our high high performers?

Mhmm. And we used franchise tools for that because franchise world has those tools. Like, that's the sort of thing we don't have in the real estate world. You know, we can guess, but the franchise world's much more mature, and they can go in and they can say, what is let's build a profile of what are the skill sets of a of a franchise owner in this particular business. Mhmm.

So we had enough history to do that, and we've just recently we've recently done it. And it was really, really interesting. Like, what are the characteristics of our highest performers? And, so one of them one of them is self management

Steve: Mhmm.

Matt: Which you talked about before. You're an entrepreneur. You're on your own. Like, how are you gonna manage your how are you gonna manage your time? You don't have a manager telling you how to spend your time.

Right. So self self management was was one. There are three things that were really, really stark. Self management, relationship management. Like, how do you manage relationships?

Like, how do you manage conflict? Because flipping a house is a dirty like, you get your hands dirty. Right? Like, you've got contractors. There's plenty of opportunities for conflict, but it's also an opportunity.

Right? It's an opportunity to bring people around a common vision.

Steve: Yeah.

Matt: How you how you do that, like, your, diplomacy your diplomacy skills, you know, and and how you how you manage those relationships, that was that was a real, a real indicator. Yeah. The third one, self awareness. And that one was really that one was really interesting to me because I hadn't thought about it, but now, like, that's obvious.

Steve: Yeah. It makes sense when you

Matt: hear it. Like, yeah. But self awareness, the the that characteristic really separated the highest performers. Mhmm. And it was you know, thinking back to some of your your recent guess, was it, Sean Terry?

Sean Terry? Yeah. Sean Terry, talked about the times that he wanted to give up. Right. And he talked about that first house and having to go back to the car.

Mhmm. You know? And, like, is this for me? But what he described was this process this ability to be self aware. Mhmm.

He sat in that car, and he didn't blame someone else. He held his hand up. He said, I'm gonna do this. Right? Mhmm.

Like, that moment separates I think that moment, that ability to understand yourself and understand your role in it, and it it it often separates successful people, probably not just in our businesses, but probably in any business. And so then I thought back to, the coaching days, you know, and coaching teams. It's like, well, what made what made the best soccer players? Mhmm. And it it wasn't the most athletic players.

Like, that was never an indicator of success.

Steve: That's a bonus.

Matt: Yeah. It's nice to have. It's not an indicator of success. What was an indicator of success is did he have the ability that when he made a mistake that he would raise his hand and say, that was my fault. Mhmm.

Because if a kid like, if an 18 year old kid has that kind of self awareness to raise his hand and say, my bad Mhmm. Then that means they're coachable.

Steve: Yeah. Right? Right.

Matt: They understand they understand that a blind spot was exposed. And if they can understand if they can have that level of self awareness, which is really rare in 18 year old boys, But if they can have that level of self awareness to to raise their hand and say, I was wrong, then they're coachable. Mhmm. And we can fix it. Well, it's no different with franchise owners or with you or me.

Right? Like, that that that quality of having self awareness is, is so important. And it's almost like the key to solving the other two problems Mhmm. Which is self management Mhmm. And relationship management.

Yep.

Steve: Right? Well, I was listening to a podcast recently. I was scrolling TikTok, and I saw these great shorts.

Matt: Yeah.

Steve: Right? And it was basically it was, Tom Bilyeu impact theory interviewing a CIA spy. It was interesting about the CIA's opinion when he was asked, like, what is your number one what is the number one secret skill, like, every CIA successful CIA agent has? And the answer he gave was, like, not what I expected at all.

Matt: It

Steve: was the ability to have perspective. Yeah. Right? The ability to get outside of your head Yeah. And see it from the other person's perspective, but also from a third person perspective.

If you can see this from a third person perspective who's not there, right, but what they can see, what maybe the reality of the situation, right, what a third party observer might see Yeah. What the other person can see Yeah. Then you then at that point have the most valuable skill apparently according to him,

Matt: of

Steve: a CIA agent. Well, you go that, you say, relationship. I look at conflict resolution. Yeah. Right?

Yep. Conflict resolution. Mhmm. You look at self awareness and self management. Yep.

I mean, I would argue if you have those if you're doing those two things well, it doesn't matter what industry you're in. Yeah. What industry, what role, like, you will be successful Right. No matter where you are.

Matt: Yeah. It's not unique to to franchise. But I think some of those skills some of those skills, it's easier like, self awareness, I think some people are it's easier for some people than others. Mhmm. But I do think a lot of that can be taught.

Steve: Yes. Absolutely can be taught.

Matt: And and but but it does require structure. Mhmm. And if you it also requires self awareness. Yeah. Like, that you know, like, the ability to hold your hand up and say, I'm not good at this.

But if you but I think they can be they can be taught in, like, for example, that, self management. I thought, Trevor. I thought Trevor did a really he did a great job of describing that blind spot that he had and and how he did it. And just managing your time as an entrepreneur is so important, and it and it involves it involves imposing structure Mhmm. On yourself.

And I think to those of us who are entrepreneurial minded, that seems like something that's that we fight. You know?

Steve: We fight it, but it's easier when we set the structure.

Matt: Yeah. Yeah.

Steve: Right? Yeah. Matt comes in. It's like, Steve, here's your structure moving forward. Woah.

What are we talking about here? But but if you self imposing structure to but you were saying earlier, guardrails Yep. Around yourself Yeah. Is a different story. Yeah.

I wanna touch on something else too because, you know, we're talking a lot about coaching here. Right?

Matt: I'm

Steve: passionate about coaching. One of the things I've said is that the greatest value in coaching is not what I have to

Matt: say. Mhmm.

Steve: That's not the greatest value.

Matt: Yeah.

Steve: Right? My life experience is not the greatest value in the coaching. Yeah. The greatest value in the coaching is every week for thirty minutes, you and I have a conversation. Yeah.

And we sit down, and you have to stop what you're doing, and you have to introspect. Mhmm. Because I'm gonna ask you a handful of questions. What have you done well in the last week? Yeah.

Right? Because then it might be an opportunity. How can we do that more often? Yeah. What didn't go so well last week Yeah.

We might have an opportunity to stop some things from happening again. Right? But your my demand upon you, right, because coaching is, my demand upon you is to stop everything you're doing. And for thirty minutes, just think about you and your business. Require it demands self awareness.

Matt: Yeah. Yeah. And and allocate time for it.

Steve: Yeah.

Matt: And the if if you didn't commit to that coaching, you wouldn't spend the time on it.

Steve: Right.

Matt: Right? There would be something there would always be something

Steve: Always something talking at you.

Matt: More urgent. Mhmm. And the urgent will come in, and it will it will steal everything from the important. Like, it will consume everything, especially especially when you're an entrepreneur and you're building stuff. Mhmm.

There's always urgent stuff. If you don't protect if you don't protect the important, like, you don't have a chance of you don't have no one else is gonna protect the important. No. Like, no one no one else is gonna protect Steve's what's important to you. Like Right.

They're gonna consume it with it because it's urgent to them. Right?

Steve: Like It's important to them. It's it's the world to them at the moment.

Matt: Yeah. Yeah. And so that's where that structure comes in. And, like, the coaching the weekly coaching call, it's it it allocates time to the important. And I think as entrepreneurs, we're really good at allocating dollars.

Like, we're good at building a budget. We're terrible at allocating time. Yeah. And I've I've really come to understand this in the past few years is there's always new ways you can make money.

Steve: Yeah.

Matt: Right? Like Yeah. But you can't make time. Like, it's finite. Mhmm.

And if your quality of life is fifty hours of work a week, like, that's fifty hours. And if you give one of them away, now you've only got forty nine. Right? Mhmm. The only way to increase that is to steal time from your kids.

Steve: It is.

Matt: And but we're not good at that. Like but I think that's where this for me, that's where the structure has come, and that's what I heard from Trevor too. You know, he said before 11:00, that's my time. I'm gonna allocate that time to the important. Mhmm.

And my calendar is the same way. Like, every day up until 11:00, it's blocked off, and it's called the important. Mhmm. And then every hour after that is is is is organized. It's structured, but it's like a budget.

I have draw my line at about forty five hours a week, and so every one of those hours is important. And so I sat down, and I budgeted everyone. And and that's been that's been life changing for me.

Steve: Yeah. Yeah. I love it. Yeah. So going back to how you're finding additional franchise owners.

Right? Because you're forty seven.

Matt: Yep.

Steve: I mean, everything is, at the end of the day, is a sales marketing business.

Matt: Yep.

Steve: So I'm wondering from the franchise world Yeah. How do you market to find potential franchisees?

Matt: Yeah. So we're bringing in, one to two new, franchisees a month, and and we intentionally call them franchise owners rather than franchisees. And franchisees is the term used in the industry, but we don't want we don't want them to be passive. And I feel like a franchisee is a passive word. Mhmm.

And one of our core values is ownership.

Steve: Yeah.

Matt: And so we use the term franchise, franchise owner. And so our job we see our job is to empower them

Steve: Mhmm.

Matt: And create competitive advantages for them in in, lead flow, in analysis, capital, building the construction, but it's to empower them. So we use the we we use the word franchise owner. So we've, it's a it's marketing. It's it's a very competitive space, in in franchising, and so but we've been very narrow, and we don't throw our whole philosophy, this is true on the the real estate side too, is we don't throw just money at the problem. We really try to use a scalpel, and we wanna make every marketing dollar go as far as it can.

Mhmm.

Steve: And

Matt: so in franchising, it's it's it's better understanding, our prospects and finding that our target prospect is someone who wants to do six to 12 flips a year. Mhmm. And we find that to be we find that to be a, a sweet spot because there's financial opportunity there. Mhmm. But there's also you can have a quality of life.

Yeah. Once you go beyond one a month, it starts you start to either have to take on overhead and hire people, or you start giving up quality of life. Yeah. And so that's our that's our prospect, and it's typically someone who's not doesn't have construction skills. It's somebody like me that wants to build a business.

Mhmm. And so finding those people, we we we use, Google Google Ads, a lot. Mhmm. A lot of the franchise world uses brokers who are almost like agents. We don't we don't use brokers, and so, because we don't want to we don't wanna grow too fast either.

Steve: Yeah.

Matt: We really wanna we we there's just a lot of different ways to build a franchise. Sure. And and we found we found that quality in franchising, that quality is much more important than quantity.

Steve: Yeah.

Matt: Same is true in flipping too. Oh, absolutely true. Yeah. We could do do a 100 flips next year, but probably wouldn't be a 100 good flips.

Steve: Quality won't be consistent. Yes. So, why why should I franchise with new again houses? Yeah. Right?

There's Yeah. There's plenty of options. Mhmm. Right? I think We Buy Ugly is the is the gorilla.

Yeah. Is that accurate?

Matt: They were the first. Yeah. When we came when we started, I think we were the second, and they were they were the only other ones in the space. But, yeah, they're big.

Steve: So why should I franchise with New Again houses?

Matt: Yeah. So, we are so when you think about flipping a house Mhmm. You are you have to add value in a you or you have the opportunity to add value in a lot of different places along the way. And so wholesalers, for example, go really deep in adding value at the acquisition. Mhmm.

So they have to be really, really you guys have to be really, really good at negotiating and lead generation at the at the acquisition. Right?

Steve: Yeah.

Matt: But to create enough margin in that one value add spot, you have to be really, really good at that. Mhmm. Flipping is different because what we're trying to do is create enough volume so that they can have a competitive advantage. And so in order to be good at any of these things, you need to do multiple houses a year. K?

So the value add is lead generation, so we need to get upstream and get, directly to that directly to that seller. We can add value there. Mhmm. But that requires a competitive advantage. Right?

Mhmm. Then once you get the lead, you have to analyze it, and you have to analyze it quickly. Because you wholesalers are fast. Mhmm. Right?

Yeah. So we have to analyze that lead quickly, but we also have to analyze it accurately. Yeah. It's a really small window. So if you get the lead generation right, but you don't have the tools and the sophistication to analyze those deals fast, flipping doesn't work.

Mhmm. So you gotta have so but it's another opportunity to add value to the deal. Mhmm. So work so there's the lead generation. There's the analysis.

Once you have those two pieces, the next place that you can add value is with the financing. It's capital like, it's capital intensive. Mhmm. So if we have a location that wants to do 12 a year, that means they need to have seven in inventory, and over half of those are in construction at any one point. Mhmm.

So that's capital intensive. So we have to provide the capital, to overcome those constraints to reach a goal like that. Mhmm. Right? So that but it's another opportunity to add value.

So now you've got the lead generation, you got the analysis, you got the capital. But then once all those things are done, now we have to actually add value to the house. Mhmm. Right. And and that's that we I think this is one thing that's different with us than some of the other franchises is we really embrace adding value with construction.

Mhmm. And I know that that's, that is seen by some as the most import the most difficult part. Like, why would you get your hands dirty with that when you can wholesale? But I was also around in 2007, and in my opinion, to survive through all of the market cycles, you need to have the capacity to add value in different ways. Mhmm.

And I've always believed that if we can add real value to the house, we can we can weather through we we can prosper.

Steve: Mhmm.

Matt: Because we we have locally. We've gone through all of the cycles now. If you can't add value to the house, there are cycles that are really, really difficult unless you are really good at one of those things. Yeah. But to survive a tough cycle and only have one place in that value chain Mhmm.

That makes it tough. So when we think about flipping, we're thinking about doing six to 12 deals a year. What does that entrepreneur need that what what do they need? What competitive advantages can we provide at every one of those places on the on the value chain? Mhmm.

And that's our job as a franchisor. And so we're adding value on the lead gen side. We're trying to add value on the analysis side with the software, the capital piece

Steve: Mhmm.

Matt: And then the the construction the construction execution piece. So it's a lot.

Steve: It is a lot. So then, you guys offer support in in the financing side?

Matt: Yeah.

Steve: So if I'm a franchise owner Mhmm. And I say, hey, man. I got this property. You guys offer some sort of financing options.

Matt: Yeah. So it is it's technically outside the franchise. Mhmm. And so it is not a part of the franchise offering, but we have created an an equity we've we've created a fund. Mhmm.

And it's in excess of $20,000,000 now. And I I mentioned Mark Pate earlier, the one who really encouraged us to do, franchising, is also the one who's built this who's built this fund. He's an engineer, and so he's very analytical. Yeah. And so he's always valued our analytical approach to flipping houses and valued our numbers, and so that fund only invests in New Again projects.

And so because the capital the capital limitation is what keeps people only doing one or two a year. Mhmm. But if you're only doing one or two a year, you can't create any competitive advantage. Like, how how are you gonna compete with the wholesalers if you're only doing one or two a year? You have to buy them from the wholesalers.

Steve: Right?

Matt: Yeah. And then the analysis. Like, you don't do enough to be able to analyze it well. Right? And then and then the the execution.

If you're only doing one or two a year, you can't keep contractors loyal to you. Like, you don't control any of the contractors. Right? Yeah. Now that that becomes untenable.

And so in a lot of ways, the construction of our business drives the, quantity of everything else. Mhmm. Because at the end of the day, that contractor who's swinging a hammer in the house, he is adding value. He's he's the one adding value. Mhmm.

We have to create enough volume to set him up for success. Yeah. And so that's why we feel like six to 12 a year is a a real sweet spot so you can have that that construction ecosystem. Well, what keeps peep a lot of people from reaching that is the capital piece. And so we knew we had to solve that piece in order to build the competitive advantages.

Steve: Right. And it makes sense if if someone in your ecosystem is underwriting it the way you're underwriting it

Matt: Yeah.

Steve: And they have the process and procedures flipping based off your model

Matt: Yeah.

Steve: You're a lot more confident Yeah. In getting those deals funded.

Matt: Yeah. So that's important because it goes back to speed. Right? Like, it's a short window. You get a seller I mean, I'm preaching to the choir here.

Like, you get that call. Like, you gotta

Steve: Gotta jump.

Matt: You gotta analyze it. Mhmm. And, it better be it better be accurate. You gotta do it fast.

Steve: Well, underwrite it while I'm on the someone in the office has to underwrite it while I'm on the way to the appointment.

Matt: Yeah. Yeah. And so, and then you can't you can't do that, and then may well, maybe I'll get it funded. Like, maybe the money will be there, but that'll be thirty days from now to where I really know. Like, it doesn't work that way.

Steve: And that confidence will come across at the appointment if you don't have confidence in the financial backing.

Matt: But that's that's where the software has become so important, and it is cost. Like, anybody that's built software knows how expensive it is. Like Outrageous. Way more expensive, like, exponentially more expensive than you think it's gonna be.

Steve: So most things are, like, 10 times harder. I would say whatever software, at least a 100 x. Whatever you think it is. For sure.

Matt: Definitely in dollars. But in time too.

Steve: Yeah. Whatever you think is gonna cost, just a 100 x it. I mean Yes.

Matt: What did you think it

Steve: was gonna be? And if you don't mind, like, as a factor

Matt: Oh. Oh, yeah. A a lot less zeros. Mhmm. Like, multiples of zeros.

Steve: Yeah. And I I can only speak on this. Right? Because I do have an engineering background. Yeah.

I did, you know, I did computer science in college. My wife, computer science. My brothers are all computer science. I understand

Matt: Yeah.

Steve: What's involved.

Matt: Yeah. Well, you can do software on the cheap.

Steve: You can. It it's not Now you're trading time for money

Matt: Yeah.

Steve: Or money for time.

Matt: Yeah. Well, it it also what you guys call technical debt. Right? Like, you do it on the cheap now. You're gonna pay for it.

Steve: When you do it right? For

Matt: it later. And when you got a franchise system, like, you can't have bugs. Right? Like, it goes back. Like, it's important.

Steve: Well, just to put it in layman's terms, technical debt and software. Right? You do it fast for now, so you and you'll clean up later. It's like putting poor foundation on the house and fixing the foundation later.

Matt: Yeah. Yeah. And it's just as difficult.

Steve: It's just as difficult. Alright. Well, now we gotta fix these different foundations. It's not as simple, like, oh, we'll just fix it later. It's like we gotta undo because there's so many ripple effects and spider webs inside of of software.

Matt: Man, we could spend a whole another podcast talking about similarities of building software and flipping a house.

Steve: Yeah. Like But if you haven't gone through it,

Matt: you don't know. You there's no way you can explain to someone No. How difficult it is how difficult it is to create a quality product, especially when it it's important. Like, it like, getting it right is important. Like, the analysis can't be it can't be sort of

Steve: Can be glitchy or unreliable.

Matt: Yeah. Like, it's it's important, but, man, it's like it kinda like franchising. You learn so much about your craft Mhmm. When you put it in software. Yeah.

It's it's like you learn it you learn it at a completely different different level. And so we've been focused on, we've been focused on flips for from the beginning. We we do some buy and hold rentals, but now we're really starting to lean into, having the same model toward buy and holds. Mhmm. And so I've been I've had my head down trying to develop that model and get that into the the software, and it's a it's it's a heavy lift.

Steve: Yep. Yeah. So I had a chance to, you know, go through your website before our podcast. And going to New Again Houses, it looks like people can submit inquiries Mhmm. To say, hey.

You know, like, I wanna sell my house. Yep.

Matt: Is that accurate?

Steve: Correct. And that's all and then in that depending on where you are nationwide or what what part of the country you're in,

Matt: you get

Steve: those leads exclusively. Yes. Yeah. So, I mean, I think if I wasn't running operation right now, I'd be like, where do I sign up? Yeah.

So Yeah. For someone who's listening, who's interested, like, how would they express interest Yeah. In being a franchise owner?

Matt: Yeah. And and that lead that lead gen piece, what we've tried to do is lean into our competitive advantage of being a franchise. And so we really lean into, like we we lean into the local. Because it's protected territories, we can put our local owner front and center as the hero. But then That's great.

And then also the local unique content that Google values so much. Right? So that's really difficult for other for franchises that don't have protected territories. They're really limited there. Mhmm.

We really lean into that. And so

Steve: I like that.

Matt: We we we, leverage the local content, but it's through the franchise site. And so we're able to boost the SEO because it's piggybacking on all of the other local sites. Mhmm. But we're able to go really deep into that local content and get ourselves recognized as Google as we're trying to be the the most credible local, option Mhmm. On on page one.

Steve: Yeah. I like it.

Matt: Yeah. But, yeah, in in terms of, there's a lot there's a lot to it. Our, our process for becoming a franchise owner is about five weeks.

Steve: Mhmm.

Matt: And it's the same same concept. We don't want people drinking from a fire hose. We don't want hasty decisions because it's ten year. It's a ten year marriage.

Steve: Mhmm.

Matt: It's a ten year agreement, and so we wanna make sure it's the right cultural, the right cultural fit. And so it's a five week process. It's kind of a guided guided discovery just like our training is. Mhmm. And it's at New Again Houses, and there's franchise tab.

There's always all kinds of different ways to find us.

Steve: So go to the New Again Houses website. Yep. Look on that franchise tab.

Matt: Yep. Awesome.

Steve: So one thing is really cool, and I look forward to being able to do this. You came here with your son.

Matt: Yeah. Yeah.

Steve: Right? So, like, I'm not at a place yet where I can bring my kids with me Yeah. But I look forward to that day Yeah. Where I can. So talk to me.

Like, what was important about bringing your son with you here? Yeah.

Matt: You know, he he happens to to have the the real estate the real estate bug. Mhmm. And, he's actually a a a fan of the podcast. He's listened to the podcast a lot. They're, doing some doing they got a pretty good wholesaling, business going, and I think he's really learned a lot and using a lot of what he's what he's learned from you.

And so, you know, I think we all when entrepreneurs, you think there's a chance that one of your kids might enjoy what you enjoy, and so when that when that comes true, it's really rewarding. But I think being an entrepreneur, you know, kids I think kids are inspired by that. Maybe it's what maybe it's what we do Mhmm. But it could be something else. Yeah.

So but it's it's it is real it is really rewarding, and we've always got something to talk about Yeah. Spend time together with. Yeah.

Steve: You brought him here, went to the Suns game. Yeah. Right? You're going to the Grand Canyon. Yeah.

You're able to create, not sure life experiences, but he gets to see what it's like, when you run a business. He gets to see perks. Maybe he also gets to see the downsides Yeah. With the negative days. But he gets he gets to he gets a sneak peek before he has to to commit to all of this.

Matt: Yeah. Yeah. It's, it's it's really cool. Like, it's, it's it's just it's really it it's really rewarding, and I'm fortunate to have a lot of the fortunate to have a lot of the same interests. We like a lot of the same things.

And so it it it is. It's it's a, it's a real it's a real it's a real privilege Yeah. To be able to to build something with your kids.

Steve: Is he the oldest?

Matt: He is. Yeah. Yeah.

Steve: Yeah. So my daughter is 12.

Matt: Yeah. And I hope Yeah.

Steve: I'm not gonna impose on her on her, but I hope that she has that that same bug. She's a strong driver, stubborn as heck. So I feel like she's gonna be either an entrepreneur or a salesperson. We'll see. Yeah.

Matt: Yeah. Yeah. It's it's, so it's so rewarding to see your kids, you know, go from 12. That's when they that that was my favorite. That's it's been my favorite part of parenting is they they just start to spread their wings and and find their own find their own path.

And, hopefully hopefully, we do a good job and they're inspired by something we do so that they can find so that they can find their their thing. And, yeah, it's it's really cool. We we tried to our big thing is we just wanted our kids to be independent. We wanted them to be able to to go, we didn't want them to be helpless. Yeah.

You know? And and be able to have confidence and confidence in going and taking on something something new Mhmm. And not be afraid afraid by it and have that end that independence.

Steve: I I think I heard you guys saying he played soccer in college.

Matt: Yep. Yeah.

Steve: Yeah. What position?

Matt: He's a he's a midfielder.

Steve: Mhmm.

Matt: Yeah. I was a forward. All my kids are midfielders. Mhmm. But our our my two girls both played played soccer too.

And Yeah. Yeah. That's another thing. We're we're all massive arsenal arsenal supporters. I have been for over twenty years.

Favorite place in the world is London. Really? Yeah. Yeah. Massive arsenal support.

It's a good year. We're Completely disconnected. Yeah. Yeah.

Steve: There's only one thing I'm paying attention to, and you can imagine why. It's that team in Miami.

Matt: Yeah. No. It's so good for, it's so good for the game, in America.

Steve: Yeah. Yeah. Yeah. So is this the first time you traveled with him, or are there other times you've traveled?

Matt: No. We've been we've been a lot of places together.

Steve: So for anyone that's listening, what is the most eye opening thing about traveling, having your kids come along with you for your business ventures?

Matt: Oh, wow. You know, I think I guess I'm thinking back to my like, nothing's easy. Right? Like, you know, I think we we look back and we see some of us may see our parents try to put on a good face. Like, everything's easy, and they they try to hide us from the hard parts of it.

But if you're They protect us. They do protect us. And sometimes you don't you don't really understand all of the struggles that your parents go through until later in life, or maybe you never like, I I don't know all the struggles my dad had Mhmm. Trying to manage working in a factory and building these businesses on on the side because he protected me from it. And I wish I'd have known.

You know? I could have learned so much from seeing him go through those struggles. Right? Mhmm. But, so, you know, none of this is easy.

Like, anybody gets on this podcast and says, like, you you have people that have built really big things here. If they're honest, none of it's easy. It doesn't get easy. It just gets more complicated, more responsibility. So, I think sharing that with your kids and them actually, like, understanding, like, how hard it is and the the the struggle and the perseverance and the persistence that it takes to, like, grind through solutions, and then them having the opportunity to do that themselves and sometimes not being able to protect them from it.

Steve: Mhmm.

Matt: You know? And they just have to they have to work through it. Like, it's a connection that I think a lot of people never had with their parents Mhmm. That's unique if you're sharing in a business. Yeah.

And I would imagine, like, families that have a a business together, you know, whether that's a dry cleaner or whatever. Like, they probably have a deeper connection Mhmm. And probably a deeper appreciation and respect for one another Yeah. Through that.

Steve: I believe that. Yeah. Definitely, my parents, did it you know, they protected us. Yeah. I do remember their fights about money.

Matt: Right? Yeah.

Steve: I remember those fights.

Matt: Yeah.

Steve: Or at least the ones that were Mhmm. In front of us.

Matt: You You

Steve: know, last year was pretty tough in real estate.

Matt: Yeah. And I remember we

Steve: had a conversation. You know, the girls are crying. They're acting spoiled. Right? Mhmm.

They're kids. Yeah. Right. They wanna do this. They wanna do this.

Right? With without regard for budgets or anything else. And I had to sit down with them. It's like, hey. Look.

I understand you wanna do this, this, and this. Look. I'm not discounting it, but here's also the reality of the situation. Right? Like, moms and mortgages Mhmm.

Not good times. Yeah. Dads and real estate, we're talking conversations about letting people go in the organization. Right?

Matt: Yeah.

Steve: So I understand you wanna go to Red Robin. Yeah. But right now Yeah. We've got a lot of things we're worried about. Right?

And we had that conversation, and, I felt like it was the right thing to do. Mhmm. But my wife's like, I think we're putting too much of reality on them. Mhmm. Like, they're still young.

Right? I mean, like, they're six, ten, and 12 now, so five, nine, 11 last year. Yeah. Yeah. Right?

But I felt like they were getting a little entitled. Mhmm. And so they needed to, like we need to hit them with a reality check.

Matt: Yeah. Yeah. I don't know if

Steve: that was the right thing to do, but that's what we did.

Matt: Yeah. I mean, I'm I mean, I just think, yeah, we could have another podcast on on parenting ideas and how it relates to business and coaching. But, you know, I I had the advantage of coaching early in life, and so I saw the end product of parenting. Mhmm. Because I coached I recruited them, and I coached them.

And I took a lot of mental notes from, like, the parents that did that well.

Steve: Yeah. Parenting styles.

Matt: Yeah. Yeah. And then I would I would talk to them about it. Like, what did you like, what was your philosophy here? Mhmm.

And they didn't they didn't protect they didn't protect their kids. You know? Like, you gotta let them struggle and let them fail. Mhmm. And going back to coaching, like, you can't learn you can't learn without failure.

No. You cannot. Like, if we protect each other from failure, like, we'll never be good never be good at anything. Right? Like

Steve: Yeah.

Matt: Struggle. But it's it's the failure that you learn from, but then just the the perseverance to, like, get up, you know, get yourself up. And going back to to Sean, like, he articulated that so well. I think it was a couple weeks ago. He articulated that so well.

Like, you have to pick yourself. You have to pick yourself up. Mhmm. Right? There's

Steve: So you notice a trend between parents that let their kids experience failure and the resiliency within those kids. Is that what you're saying?

Matt: Oh, man. I still coach. Like, I still coach club. I still coach club. And, like, the urge for parents today to protect their kids Mhmm.

And not let them struggle through their own problems and find their own solutions is just cheating them. Mhmm. Like, what what is sports? Right? Like, what is the benefit of sports?

It's like, that's adversity.

Steve: Mhmm.

Matt: Like, where in life is some upper middle class kid in America going to experience adversity, like, in real life? They're not going through dark alleys. No. Right? Right.

They're not fighting their way out of their neighborhood. No. Like, where are they where are they gonna experience adversity and learn persistence? Well, sports. Yeah.

That's it. If we take that away from them, like, if we take the adversity away, like, what do we like, what chance do they have? Because when you if you wanna build something, if you wanna spread your wings, like, you're gonna have to fail and pick yourself up. Mhmm. Get through it.

Steve: Yeah. We are we we're bringing on a recruiter, and her favorite place to recruit are former college athletes.

Matt: Yeah. Right? Yeah.

Steve: It's like if they're not, like, if they're not former college athletes or excelled in something else Yeah. Right? So that purse the ability to persevere and excel. And, you know, one of the things I was talking about is I I was, like, I was doing a presentation about leadership. Yeah.

And I had to let your people fail, and it sucks. Mhmm. It sucks.

Matt: Mhmm.

Steve: Right? And and people struggle with it, like, letting your letting your team fail, especially because, you know, money's on the line when you fail.

Matt: For sure.

Steve: But then I put it another way. It's like, well, how many helicopter parents are you like, man? I love the way they raise their kids. No. No one.

Yeah. Well, it's the same thing. Yeah. You're not if they're not letting their kids fail and you see, like, they're they're coddling their kids and their kids are not not contributing members of society, you gotta let your team members eat dirt sometimes so that they can solve problems.

Matt: Yeah. Because, you know, I think back, like, our our flipping operation, like, those guys weren't better than me on day one. Right. Right? They got better than me, but it was because they made mistakes.

Mhmm. Right? You learn you learn from them, and you have to be but coaching, like, the number one the hardest thing with coaching that I found is the fear of failure for kids. So when you're coaching kids to do something, the the the lift of getting them to go outside their comfort zone

Steve: Mhmm.

Matt: And try something they're not good at, the hardest thing to overcome is the fear of failure. Mhmm. And until you create an environment where they're not afraid of failure, like, you can't get from here to there. Like, you can't develop. You can't develop that player.

Yeah. Like, you have to go through that. You have to go through that failure, but it takes a it takes

Steve: a it

Matt: takes a bit of courage to to risk failure. And I think that's harder in today's world too because your failure could end up on social media. Right? Yeah. Like so it's but but, yeah, it's it's so important.

Steve: Well, I mean, there's one of the reasons why. So we offer coaching and mentorship and this and that. One of the things we don't do is you've never done a transaction before. We won't bring you on for coaching.

Matt: Yeah.

Steve: And that might sound, you know, horrible. Right? Like, you know, like, if you don't have experience, don't apply. Right? That might sound terrible.

But what I have found is if you haven't done a deal before, there's a lot of skills in overcoming, persevering, problem solving.

Matt: Yeah.

Steve: Right? Like, you've never done a deal before. You've got a lot of mental baggage

Matt: Yeah.

Steve: That I don't feel qualified. Right? Yeah. Or really the bandwidth to help as many people as possible Yep. With that struggle.

Matt: Yep. The bandwidth is the bandwidth is important, and I think I think that's wise. In our franchise system, like, most of the people that come in have not done a deal. And but we compensate for that by by just a lot of support in terms of structure. We surround them.

Yeah. Structure Yeah. Guardrails, community. Mhmm. Like, we really try to surround them with a with a village Mhmm.

And really try to overcompensate for that lack of experience. But there is no there is no substitute for for experience.

Steve: Yeah. So you got a lot of things going on. Right? Again, going back to we were talking about headline. Right?

23 states, 47 franchise franchise owners. It's a big vision. And he talked about you have to have a vision big enough for others to to see themselves in it. Yep. So what is your vision?

Matt: I think what what I've learned from franchising is that people define that vision with a number. Like, I wanna have 500 franchises. I have really tried to fight that, and I don't think I don't wanna measure success in numbers. Mhmm. My why is I want to be a part of an organization that does something at the very highest level.

Mhmm. Like, I wanna be a part of something that does it be the best at it. Yeah. And I don't think that is quantity as much as quality.

Steve: Right.

Matt: And one of the things that I'm working through now is, like, what is the optimal team size? Because you see these franchise systems that get really large really quick, and then they start hiring managers and then middle managers, and then they've got this whole bureaucracy before you. And then that's what we're running from.

Steve: Mhmm.

Matt: Right? Like, I don't wanna recreate that. Like, I don't wanna have a 100 employees and

Steve: Right.

Matt: 2,000 franchises.

Steve: And then you call your life suffers.

Matt: Yeah. And, like, some I I keep coming back to like, I think a small team has so many advantages. Mhmm. And thinking back to this past year in real estate, like, the the ground shifted under everybody's feet Mhmm. In 2022.

Right? And, like, if you didn't pivot fast, you got in trouble quick. Right? Like, it happened so fast. And so our our advantage was that we were small, and I compare it to a jet ski.

Mhmm. Like, we were able to really pivot. We were able to, switch strategies with inventory and really navigate that well. Mhmm. But if we had been, like, a big freightliner of an organization, we could not have gotten through that Mhmm.

The way that we did. Yeah. And so when you think about building a business, like, what do you want that to look like? Well, maybe it's better to think, alright. What do I want my team to look like?

Like, what does the what does the ideal best in class team look like? Mhmm. Is that 10 people? Is it 15 people? Is it 20 people?

Let's figure out what that is, and then how big how big does the platform have to be to to set them up for success? Yeah. And so we're still figuring that out, but it's not gonna be I don't I don't think of it in terms of becoming some massive organization. That's not success to me.

Steve: Yeah. So going back to, though, you're mentioning, like, that you know, figuring out your why. What is your why?

Matt: I I think it it is it is being a it is really being a part of a world class organization. I get so much satisfaction in that, and and maybe it it it's not unlike it's not unlike coaching, because, you know, in coaching, your your greatest success is when you see players do it better than you could do it. Like, that's the whole goal, and you wanna celebrate that. And I see that as this thing that we're building. Like, I want I wanna empower I truly wanna empower not only our team, but the franchise owners to be better at this than we are.

Steve: Yeah.

Matt: And that that has I think that has always been my why, and it comes back to the the the teaching the the teaching gene. Mhmm. Yeah. Why

Steve: do you think that's important? Or why is that important to you?

Matt: It's a it's a it's a really good question that I don't have an answer for yet. Mhmm. And I think, like, I just turned I just turned 50 recently, and, like, I feel like this whole thing has been self discovery. Like, it it's like a journey of self discovery. Yeah.

Like, I learned things about myself when I did the accounting internship. Right? Like, I learned I learned a lot about myself. I learned, like, how much I didn't know about myself. Like, I was gonna be an accountant, and I hate accounting.

But I learned stuff there. You learn stuff from the the coaching and the teaching. You learn stuff, at in every decade. You learn stuff from parenting, but you you what you really learn is about yourself. Mhmm.

Right? Like, how much more do we learn and know about yourself after having kids?

Steve: A lot. Yeah.

Matt: They're still a mystery, but I learned a lot about my I learned a lot about myself. But, I think, honestly, that I I don't think I figured that out yet, why that's my why. Yeah. And And I think it'll change too. Mhmm.

Like, my why when I was in my twenties was different in my thirties. Mhmm. I outgrew I outgrew my why. Mhmm. Right?

That's why I needed to do something different. Yeah. Then my why was different in my forties. Mhmm. And I hope my why is different in my fifties.

Steve: Yeah. Yeah. Yeah. I'm asking these questions because there's a lot of similarities. I can see, like, I have a lot of common interest.

Yeah. And I have a lot of the same ambitions, but I still articulate at times still struggle at times to articulate why that's important

Matt: to me. You know, another another answer to that question is this this made a profound effect on me when I heard it, and it was Nick Saban talking about, on a sixty minutes episode. And they asked him something about team chemistry. Mhmm. And he said, the secret to team chemistry is having people with similar ambitions.

If you have a team with people with different ambition levels, none of them will be happy. I heard that probably ten, fifteen years ago, and it has stuck with me, and I think it's so it's so true. Yeah. And I think part of my why in wanting to build that world class team is because I wanna have a team where our of similar ambition levels. Right?

Yeah. Because if if you're surrounded by people that are more ambitious than you, they're gonna be frustrated with you.

Steve: Mhmm.

Matt: Right? Yeah. And and there are people way more ambitious than me, but I I value quality of life Mhmm. In a way that they don't, but they'd be frustrated with me. Right.

So, like, building an organization and a culture that is has has those things in in place, I think, is part of is part of what I'm wanting to do, but I haven't figured I haven't figured it out.

Steve: What's your biggest struggle today?

Matt: I think it's the responsibility. And, you know, when you when you coach, you just take you can't separate the personal responsibility. It's it's very similar to parenting. Like, in theory, you want to, you can't. You know?

And, when when you when you when you people trust you and they come in, that I carry that responsibility. I'm sure you do with with students Mhmm. That that trust you, and, that that's a that's a lot. It's a lot of responsibility. So kind of, working through working through that, along with just the responsibilities of building stuff.

So now, like, I've figured out at some point along the way, I need to be building things, But now you've got the responsibility of building them, not just for myself, but for other people too. Yeah. So yeah. Yep. Yeah.

Steve: What is your superpower?

Matt: I would say two things. I'm I'm a really good listener, and I learned listening back in graduate school. I had an opportunity to be a work with, World War two veterans in the VA hospital during graduate school, and I was there with them when they were dying. It was, around 2000, so that was kinda what was happening. And you'd you'd walk in you'd walk in this room, and you'd be, you didn't know what was on the other side, but you knew it was a as a veteran, and they'd be getting things limbs amputated and lonely and all those things, and I'm 23 years old.

Steve: Yeah.

Matt: And so the mentor of that program taught me active listening, which I know you've written on Mhmm. Recently. Like, there is nothing that I can say that has any value to a veteran who has fought in Normandy and is dying. Yeah. Right?

I'm 23. There's nothing I can offer. The only the only thing that I could do was listen. Mhmm.

Steve: So

Matt: I had to learn to listen, and he was really good at teaching me how to listen. And so Yeah. I feel like, I learned that there, and it's been so valuable valuable throughout. The other thing is I think there's a, just a a relent relentlessness. Yeah.

Like, when I see a problem that needs to be solved, I just don't let go of it until

Steve: You're a bulldog.

Matt: Yeah. And and maybe it's almost to a fault because I probably spend more time on some problems than they've I should've, but, it's just that real that relentlessness and But

Steve: you get the satisfaction when it's done.

Matt: Yeah. And I and I maybe I got that from Dennis Rodman's rebounding.

Steve: Yeah. Well, maybe that's why you're such a big fan.

Matt: Yeah. It could be. It could be. Like Right.

Steve: Relentlessness and tenacity. I mean Yeah. I mean, I loved it too. Right? I wish I had his Energizer Bunny energy Yeah.

Right, where you can go all out on every play. I wish I had that. I don't have that.

Matt: Yeah.

Steve: I can go out Yeah. Every tenth play. Uh-huh. Alright? But you can go out on every single play

Matt: Yeah.

Steve: And not be tired. I mean, like, you've watched the the last dance. Right? I mean, he was going out drinking, and the next day he's

Matt: Unbelievable.

Steve: He's got the he's at full capacity.

Matt: Yeah. Can I tell you a story? One one story about Dennis Rodman. One one thing, like, they asked him one time, like, he's the rebounding king. Right?

Like, they said, and a journalist said, how do you, like, how do you rebound? And Rodman was like, what do you mean? How do I rebound? How do you dig a hole? Mhmm.

You get a shovel and you start digging.

Steve: Yeah. You just You just do it.

Matt: So much of so money like, there's a time where you you do just have to pick up a shovel and you

Steve: It's the work.

Matt: You you dig. Yeah. Especially in the beginning. Right? Right.

Like, you don't have an infrastructure. You don't have a team. Like, there's a time in life where you just have to pick up the shovel and Yeah. And dig.

Steve: That's exactly I mean, I said this a couple of times on today's show. Right? The season of suffering. Like, everyone who's been in the show Yeah. Has gone through a season of suffering.

You can't make it if you haven't suffered. No. No.

Matt: You can't build anything without without that part of it.

Steve: Yeah. So I want you to think about something you wanna leave all the listeners with. Right? Last last thoughts. We'll make a couple of, you know, announcements.

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Yeah. So what are some last thoughts? Gone through a lot of topics here.

Matt: Yeah. Yeah.

Steve: Last thoughts you wanna leave

Matt: all the listeners with? Man, I've I've thought a lot about the the why with coaching and the in it, like, the the parallels. We we talked about, talked about parenting today. And I've I've asked myself, you know, peep peep parents invest so much in their kids. They invest so much in sports.

Why they do it? Like, what is the point of it? They're not gonna be professional athletes. Right? And one of the things where I've landed in the past couple years with coaching is maybe the point of it is to make them good teammates.

And when you think about those qualities that came out in what the indicators of success for our franchise owners, self management, relationship management, self awareness. Like, those are the qualities of a good teammate. Mhmm. And maybe and and that's who we wanna that's who we wanna work with. Like, that's what we that's who we wanna build teams with.

That's who we wanna enjoy success with or or good teammates. And so maybe maybe that's the point of a lot of the stuff that we've talked about today, and maybe that's what success looks like and this process looks like, is just learning how to be, a better teammate. Mhmm. But then I also think that maybe success is intentionally surrounding yourself with good teammates.

Steve: Yeah. I like it. Yeah. I like it. You wanna be a valuable team member on a team where everyone wants to be contributing.

Yeah. One of the things that you know, like, what do I want for my kids? I don't want money for them. Right? Yeah.

I don't necessarily want happiness for them. Like, they're gonna find they're gonna have to find what happiness means to them. Yep. But what is important to me is that they're gonna be contributing members of society. Yeah.

Right? Like, that's what's important to me. Like, I wanna like, when I when I'm done, like, they're valuable people. Yeah. That's what I want.

Matt: They give more than they took.

Steve: You

Matt: know? Being a good team

Steve: Being a good teammate.

Matt: Teammate. Yeah. Yeah. Maybe it's maybe all of this is that. Maybe it's maybe it's that that simple.

Steve: Yeah. Maybe it is. If someone wants, get a hold of you, what's the best way for them to do that?

Matt: Newagainhouses.com. And, or if you wanna get directly in contact with me, it's Matt Lavender on LinkedIn. Lavender with an I. There's not many of us, so I'm pretty easy to pretty easy to find.

Steve: Yeah. Yeah. Perfect. Thank you so much. Alright.

Matt: Thanks for having me.

Steve: Yeah. Yeah. Absolutely. My pleasure. Thank you guys for watching.

See you guys next time.