As the United States goes through what is possibly the most divisive election in ages, we find ourselves in (needless to say) very partisan times. Indeed, one poll found that a full 61% of Americans believe we are on “the verge of Civil War.” This is certainly hyperbole. But if “divided we fall” has any truth to it, we are certainly falling.
Added to these tensions is a pandemic that is driving more and more small businesses out of business and keeping many people unemployed. At the same time, wage growth is slow and income and wealth inequality continue to increase (even if the statistics given are often misleading or exaggerated. And every metric of partisan division—most notably my Facebook feed—is basically off the chart.
Gurus Are Selling FOMO
And into this mess steps in a particularly annoying brand of individual, intent on lining their own pockets or padding their fragile ego by injecting content-consuming “normies” everywhere with a highly toxic dose of FOMO directly into their striatum.
I’m sure you’ve seen these jokers.
The gurus trying to sell their $10,000 course on real estate investing (or cryptocurrencies or drop shipping or Amazon FBA or day trading or some other multilevel marketing scam). For some reason, their “educational videos” usually have a Lamborghini in them. Maybe scenes from a Caribbean vacation, a few supermodels, an entourage of guys in suits with sunglasses walking decisively in slow motion. Someone’s probably smoking a cigar (presumably Cuban).
It’s really rather sad actually.
Many such gurus have what seems to be an almost identical approach. Yet even with what appears to be a boilerplate sales pitch, many online gurus have gotten in way over their heads in all sorts of ways—from making up fake credentials to forging income statements to plagiarizing—whether plagiarizing other gurus or trying to plagiarize their own students.
(For those interested in how the guru method works, this video by James Jani has the best breakdown of the “fake internet guru” I’ve seen thus far. It’s definitely worth checking out.)
One of the things that’s so refreshing about BiggerPockets is that it avoids “get-rich-quick” marketing, sleazy sales tactics, and high-ticket “trainings.” Instead of charging many thousands of dollars for false promises it favors free educational articles and podcasts, as well as books that cost all of $20.
I’ve dealt with these gurus overcharging and lacking substance before, but here, I want to focus more on their fakeness. The extreme but illustrative example of Lee McKenna from a few years back is telling.
“A fraudster who convinced his victims he was an ‘internet millionaire’ using films he made in sprawling mansions and expensive cars was actually running a scam from a terraced house in Middlesbrough.
“Lee McKenna promised that for a £2,000 sign-up fee, his followers would earn up to £1,000 a day using the tips in his promotional videos.
“He shot the films while strolling around huge mansions and leaning on a silver Bentley in a bid to make himself look successful.”
Did I say every one of these guys had a Lamborghini? My apologies. Some “have” Bentleys.
Not only was his product fake, but his entire shtick was also fake. He wasn’t rich. He didn’t own a mansion, instead he “visited a large property which was for sale and asked to film a video tour ‘to show his fiancee.'”
Then he “passed the house off as his own and even returned when the occupants were out to photograph himself in the driveway with a Bentley.” Class act for sure.
Or then there’s Tanya Marchiol, the “Phoenix celebrity real-estate guru” who “was sentenced in federal court this week for helping drug dealers buy a house and for failing to pay income tax on $1.4 million.”
There’s something about many of these types—they just can’t help themselves.
Such things have been going for a long time and first came to my attention back in the mid-2000s: John T. Reed was waging his battles with various gurus. But as should be plain to see, much of what these gurus sell is a dream.
“Look how wealthy I am and how awesome my life is! For just $2,500/month you can have the same!”
And, “Don’t ask why I would be wasting my time selling this stuff if I was making so much money with my own program—just pay me!”
Of course, what they sell tends to be as fake as their wealth. Yes, some of them are fantastically wealthy (usually from selling their coaching rather than having success in whatever they are coaching about). But it doesn’t take much research to realize many of them are simply pretending to be rich so they can sell their actual product (the dream).
Aside from the ethical concerns of such gurus, they also create externalities that spill over into the rest of society. As I noted in my last takedown of the gurus, their marketing campaigns “shouting about how much money they make [and] how easily they made it” have “seeped into the culture at large and convinced a substantial number of regular folks that a handful of super-wealthy landlords live a life of luxury off their rent while doing virtually nothing else. It’s false.”
Unfortunately, convincing all people that capitalism ain’t so bad is going to be a tough sell. But for those who have no inherent problem with people who are wealthy—but tend to despise those who brag about their wealth almost as much as those who gain their wealth by corrupt means—the guru schtick isn’t helping our case.
In Praise of Seemliness
I am certainly not saying that all coaching is illegitimate. Nor am I arguing that nothing should be done on a political level. COVID-19 and the subsequent lockdowns have hammered small businesses and lead to a major consolidation of industry. This needs to be addressed.
Still, by rehabbing dilapidated properties, creating jobs for employees and contractors, providing returns to lenders and investors, and maybe donating to a few charities for good measure, real estate investors offer a valuable service to society. But aside from that, I think we need to get back to a culture of seemliness, meaning “fitting or becoming with respect to propriety or good taste; decent; decorous.”
Perhaps add in a little humility, too. (This would go for real estate investors and non-investors alike, of course.)
Yes, we should announce our newest projects and celebrate our successes. There is a lot of nuance here and no exact lines. But I think the famous phrase “act as if you’ve been here before” is a good rule of thumb.
Success should not seem effortless; nor should it be something you feel the need to rub in other people’s faces. Unfortunately, not everyone agrees on these points.
Trying to win approval by flaunting a wealthy lifestyle (again, real or imaginary) will always be fake and superficial. And doing so en masse hollows out our culture and builds resentment. Plus, those lifestyles are about as real as a seller-provided pro forma on a completely vacant 100-unit apartment complex.
Material wealth is the wrong motivation and thereby is unlikely to inspire you to persist when the going gets tough. The costs of maintaining such a lifestyle (even if fake) are also highly counterproductive and poor use of time.
Finally, bragging sets a bad example for others while bringing negative attention and building resentment toward our industry. It also breeds complacency. You might just start believing your own press clippings—which, of course, you also conveniently wrote.
The Bottom Line
Material wealth and the “guru lifestyle” are not even things to aspire to. Life is a journey, not a destination. So is building a business or becoming a successful real estate investor. The goal should be to enjoy the path and eventually reach a point of financial freedom (hint: a flamboyant lifestyle doesn’t help).
Aside from relationships, it’s growth and building something great that are the things truly worth living for. Remember: “Pride cometh before the fall.” In fact, research shows leaders who are more humble are more successful. Seemliness goes right along with that. This isn’t always the case, but it does seem to be the general trend.
Let’s discuss below.