Quit my full-time job

Real Estate Deal Analysis & Advice
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Quit my full-time job

John Blackman
Developer · Austin, TX · Member since 2010 · 371 posts · 284 votes

I figured I would share a personal victory here.  @Bryan Hancock and myself have been ramping up our project volume over the last four years and this is turning out to be a banner year.  So much so that I was able to quit my full time job as a Development Manager at Microsoft to take on real estate investing and development as a full time passion.  My last day was in April, and I can't imagine going back.  The business would suffer too much.

I started investing about 5 years ago, starting with fix and flips.  My very first flip made $700 and took me 6 months.  But the lessons learned were priceless.  The next flip I did made $7,000.  One power of ten is pretty good for deal #2.  Then I started building.  Deal #3 made about $30,000 and took 9 months.

Today Inner 10 Capital has 43 active projects with a full pipeline and I'm doing it full time.  It's actually more work than my day job was, but it doesn't feel like it.  It's fun, more lucrative than my day job, and scalable which is the most important part.

Five years isn't that long anymore, but it's long enough to have a complete transformation.  Thanks to everyone who's been a partner, mentor, and cheer leader.

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Lamar Cannon
Investor · Austin, TX · Member since 2012 · 205 posts · 112 votes
12y

@John Blackman congrats again. I was there to see you quit your day job and it was awesome, but it's good to read the detailed story of how you got there. 

I'm glad to be working with / learning from you and @Bryan Hancock    In our short time working together, the info I've learned has been invaluable. I have no doubt I will have a similar story soon.  Thanks for the willingness to share your knowledge guys!

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  • Bryan Hancock
    Investor · Round Rock, TX · Member since 2010 · 8k+ posts · 4k+ votes
    12y

    @Karen Margrave John has committed to do a J Scott-style blow by blow of two of our development projects. One will be a deal we crowdfunded where he'll share the details about that process. The other will be a project that is about to start that was a JV among some Austin folks. In each instance he will share details about the deal structure and weekly details about the project's progress, the financials, how we're tracking to budget, pictures of completed work, etc. We send this out every week to our investors on each project anyway so the overhead in sharing it on BP is pretty low. Plus this will help him hit is 10 post/day target ;-)

    I hope that this is helpful for some and inspires people to act instead of sitting on the sidelines waiting on things to happen.  Get on a team of some sort either actively or passively and make it happen folks.  The benefits are well worth the costs for those that take it seriously!

    1Reply
  • Karen MargraveBusiness Member
    Moderator
    Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
    12y

    @Bryan Hancock That will be great! I get calls regularly from people asking questions, and I've posted blogs on the basics, but a J Scott style blow by blow would be a great way to keep it front and center! 

    There are people with the experience in rehabbng, or construction that want to make the move to development, and it may help them get off the fence. For others, they may realize there's far more to this than it seems, and they may want to consider doing a partnership of some type with a developer or builder. Then for those that like the niche but don't have the money, crowdfunding allows smaller investors to opt in.  

    So, @John Blackman I'll be looking forward to your posts, and referring some of those people there! 

    I take it you, Bryan, are the financier of the company? How many project managers are you using to run that many jobs, etc.? 

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  • Account Closed
    Investor · Austin, TX · Member since 2014 · 27 posts · 9 votes
    12y

    Wow! Congratulations @John Blackman . I am inspired to see a fellow techie go down this route :) Great to see that.

    BTW, I was fully expecting you to say that you didn't go for any coaching/classes. Its good to get a different perspective of that. You often see coaching being bashed on BP, I wasn't a big believer in it myself. So its great to get an alternative viewpoint. 

    @Bryan Hancock - you make good points. Coaching is all about how its done. As with most things, if done right, it will reap benefits. Same with coaching I guess :)

    Congratulations and happy investing!

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  • Bryan Hancock
    Investor · Round Rock, TX · Member since 2010 · 8k+ posts · 4k+ votes
    12y

    We finance the projects in many different ways @Karen Margrave Crowdfunding is one of many different ways.   We have 4 builders working for us now, but one is our main builder.  We have some experienced folks proving themselves with our model that will likely take on 10-12 projects at a time in the next year or so.  Finding quality builders that can bring stuff in on time, budget, and quality is really our main constraint at this point.  We have way more money than operational capacity right now, which is a good "problem" to have ;-)

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  • Joe Demonte
    Contractor · Chicago, IL · Member since 2013 · 105 posts · 28 votes
    12y

    @John Blackman Thanks for sharing & congratulations on finding a new financial path and passion!

    Its great to hear about a positive mentorship experience. Having someone ready to hit the ground running and accepting the challenging bumps along the road really help differentiate the serious investor from the hobbyist.
    Happy to hear you are part of the serious (get it done) group! ;)

    I am excited to hear about the details on the 2 development projects @Brian Hancock is talking about. :D

    0Reply
  • John Blackman
    OP
    Developer · Austin, TX · Member since 2010 · 371 posts · 284 votes
    12y

    @Stephen D. 

    There was a convenient turning point in my career at Microsoft.  I had just finished a big project with them and there was some down time around the holidays where I was able to spend more time on the Real Estate business.  Within a few months I was easily spending about half of my time on developing the business and half on keeping my responsibilities afloat at Microsoft.  However at that point I was no longer growing in my career, I was just keeping up.

    Then came the next project at Microsoft which would have sent me to China for three months to help start a new factory for one of our device partners.  That would have unplugged me from the Real Estate business for three months.  I think it would have hurt the business in a big way.  I also have two kids aged 1 and 3 which I did not want to be away from for 3 months.  That is 25% of my little guy's life!

    Fortunately the timing worked out that we had 4 projects that were exiting at that time which yielded for me about half of my annual salary.  So I figured this was the time to put up or shut up.  I would have 6 months to close another 4 sales which would cover me for the rest of the year.  Seeing as how we have 14 that should finish by the end of the year, there was really no reason not to quit and go full time to help bring those other projects in on time and budget.  My time was officially better spent on Real Estate in terms of yield per hour of work than it was at Microsoft.

    2Reply
  • Pyrrha Rivers
    Investor · Yokosuka, Japan · Member since 2014 · 631 posts · 184 votes
    12y

    @John Blackman and @Bryan Hancock it is so heartwarming and encouraging to read of your relationship resulting in such a huge success! Congratulations and best wishes to you both with your endeavors jointly and individually.

    Pyrrha

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  • John CasmonPro Member
    Cincinnati, OH · Member since 2013 · 1k+ posts · 1k+ votes
    12y

    @John Blackman Congratulations. What a huge accomplishment. Shows the power in networking and partnerships. Hoping to take similar steps this year. Congrats again.

    0Reply
  • Jon Klaus
    Developer · Garland, TX · Member since 2008 · 8k+ posts · 4k+ votes
    12y

    John, it's been great to be able to watch your progress over the past three years.  Leaving a good job with its golden handcuffs is a  tough call.  Fortunately they made it a little easier for you by threatening to send you to China. 

    BP, John is a fantastic project manager. He will run down the details that get by many of us "big picture" guys. Sometimes those details make the difference. 

    I vividly remember visiting one of John and Bryan's new builds a couple of years ago. The house was about halfway done. John was sitting on the kitchen subfloor with his laptop, holding the Builder's feet to the fire, wanting every receipt.  That builder was a bit too sloppy with his bookkeeping for John. 

    Congrats, John!

    Bryan, when are you leaving the day job?

    2Reply
  • Bryan Hancock
    Investor · Round Rock, TX · Member since 2010 · 8k+ posts · 4k+ votes
    12y

    Not sure Jon....too lucrative right now ;-)

    0Reply
  • Pete T.
    Real estate investor · Las Vegas · Member since 2013 · 798 posts · 171 votes
    12y

    Congrats Jon. My job absolutely gets in the way of my REI. I am planning an exit in 6.5 years.

    0Reply
  • Phillip Gonzales
    Real Estate Investor · Glendale, AZ · Member since 2014 · 17 posts · 3 votes
    12y

    Wow this story is truly inspirational to me. I am just getting into real estate and feel my goal is to leave a W4 in 5 years which would make me 30. I have big plans and its stories like this that get me even more excited! Thanks for your story and wish you nothing but continued success! 

    0Reply
  • Robert Johnson
    Wholesaler · Chandler, AZ · Member since 2013 · 21 posts · 6 votes
    12y

    Congrads John!

    0Reply
  • Sapan T.
    Real Estate Investor · Los Angeles, CA · Member since 2014 · 10 posts · 0 votes
    12y

    @John Blackman Congratulations on your success and full time transition into your passion. Also, thanks for sharing your story; it's inspiring/motivating. I'm building/working my way to that transition-goal myself. 

    0Reply
  • Arthur Banks
    Real Estate Investor · Waukegan, IL · Member since 2013 · 367 posts · 80 votes
    12y

    @John Blackman Congrats! Very inspiring!

    0Reply
  • Tom Keith
    Investor · Longview, TX · Member since 2012 · 631 posts · 186 votes
    12y

    @John Blackman Way to Go John,  congrats and Wishing you the best. I am looking forward to seeing another deal like Austin.  Tom 

    0Reply
  • Don Koss
    Investor · Fox River Grove, IL · Member since 2011 · 28 posts · 10 votes
    12y

    @John Blackman   Congrats John!  I am also planning on leaving the corporate world very soon.  One question for you (since you have small kids), is what did you do about health insurance (or does you wife work)?

    Thanks so much!

    Best Regards.

    Donko

    0Reply
  • Paul Palmer
    Real Estate Broker · Minneapolis, MN · Member since 2014 · 20 posts · 21 votes
    12y

    Hey Congrats, @johnblackman, it's always awesome to hear about investors who pull the corporate cord. I did it some 20 years ago. Never look back and build in increments, stairstep it and don't be afraid to hand the management. You need your sleep to run during the day.

    0Reply
  • Judd Campbell
    Georgetown, KY · Member since 2014 · 179 posts · 55 votes
    12y
    Congrats! I am also curious about the health insurance question
    0Reply
  • Mike Palmer
    UT · Member since 2013 · 164 posts · 55 votes
    12y

    I can't speak for John directly, but with Obamacare you can get on private insurance if/when you leave your job. With the beneficial tax advantages of real estate to offset much of your income, it is also likely that you can get subsidies to cover much of the cost. 

    0Reply
  • George P.
    Property Manager · Livonia, MI · Member since 2011 · 4k+ posts · 1k+ votes
    12y

    that's amazing that you got the courage to do it while having a great paying full time job. could you have done it if you hired people instead and kept the job?

    and i agree that real estate does not feel like work! 

    0Reply
  • Rolanda Eldridge
    Investor/Realtor · Hoover, AL · Member since 2010 · 1k+ posts · 459 votes
    12y

    Congrats!!!

    0Reply
  • Brandon Foken
    Wholesaler · San Francisco, CA · Member since 2012 · 259 posts · 147 votes
    12y

    Congrats @John Blackman 

    I left my cushy corporate IT sales job to work with a real estate investing firm; however, less than 2 months later they let me go. Since that time, I've had to blaze a trail of self-employment and I'm loving every wonderful, stressful minute of it. I like your way much better though - have the money and projects going before jumping in with both feet!

    @Judd Campbell - Obamacare is where it's at, especially in California where we have a robust private exchange. I have regular ol' Blue Cross insurance that is subsidised a bit. Extremely easy to enroll and use your coverage.

    0Reply
  • John HornerPro Member
    Flipper/Rehabber · Columbus, OH · Member since 2013 · 1k+ posts · 655 votes
    12y

    Fantastic, congrats!

    0Reply
  • John Blackman
    OP
    Developer · Austin, TX · Member since 2010 · 371 posts · 284 votes
    12y

    Thanks for all of the well wishes everyone.  I hope I can contribute back by sharing some of my experiences.

    Regarding healthcare, the Microsoft plan was what I would consider a 'Cadillac' plan.  It cost us nothing and paid for everything.  So I knew I was going to have to bite that bullet pretty hard.  To continue to pay for healthcare at the same level would have cost me $1,300/month for my family.  Ouch.

    After looking at all of the plans out there, I found that they scale in price based on your out of pocket deductible.  So at the low end I could pay $800/month for an annual *gasp* $12,000 deductible before the insurance kicks in.  This is basically the you pay for everything unless there is a major disaster plan.

    On the high end, there was $1,300/mo for the no deductible plan.  However that costs $6,000 more per year.

    I chose the $800/month plan which is basically the same except I get to put that $6,000 in my pocket instead of the insurance companies pocket.  So I get to keep it if I don't use $6,000 a year in health costs which to date my family has not come near.

    With that extra cash I simply put it into my HSA for a nice tax savings and write off and I just pay out of pocket for all of our health care expenses from the HSA card.

    So at the end of the day my total annual health insurance costs are $9,600 in insurance and about $2,000 in actual expenses I pay from my HSA card.

    Health insurance always seems like a scary topic, but really you can just assign a cash value to it and get on with life.  $10,000 is only a portion of one deal.  So if I can do at least 12 deals a year, this is just another line item on my household budget with some nice tax advantages.  I pay for my health insurance with my business account, so it's deductible too which further lowers my actual healthcare costs.

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