Rookie Reply: Tony & Ashley Talk Challenges They Face Today

Ashley:
This is Real Estate Rookie episode 124. My name is Ashley Kehr, and today I’m going to be Tony’s therapist as we walk through some issues he’s having in real estate.

Tony:
I got so many issues.

Ashley:
All kidding aside is that we thought we would do this Rookie Reply episode, just being vulnerable and talking about things that we are currently struggling with.

Tony:
I think people see us or hear our voices on the podcast and think that we’ve got everything figured out. But it’s so far from the truth. We’re normal people. We’re investors trying to figure things out just like you guys. So we thought it’d be cool to share what’s going on in our-

Ashley:
I have two conflicting events I could go to in a couple of weeks. And I text my friends in our group chat and I said, “I have to decide which one should I do.” And I said, basically what scenery, what I prefer when I cry during a mental breakdown. So that’s where I’m at at life, everybody.

Tony:
Well, where do you want to start Ashley? What are some challenges that you’re facing in your business right now?

Ashley:
I think a lot of it is I’m the shiny object syndrome. And then we’ve talked about this already, the clarity that we both have as to what’s next and what to focus on. So I’ve done buy and hold, and honestly, I’m bored with it, which isn’t a great thing to have because it works well for me. I know it well. I could buy a property in my sleep, but a lot of things motivate me by being interested in them and I’m getting bored. So I’m trying to figure out what’s the next thing. Is it mobile home parks? Is it self-storage? Is it commercial property? Is it flips? What is that? Is it short term rentals, taking over Joshua Tree from Tony? What’s the next thing. And I think that’s something we’re both struggling on.

Tony:
Very similar. I bought my first investment property in October, 2019. And I feel like sometimes people will forget that I’m still a relative rookie myself. Now, obviously we’ve made a lot of purchases since then. So I think I probably got more experience than the average person who started two years ago. But similar to you, it’s like now we’ve gotten to a point where it’s like, okay, what does expansion look like for us? What does scale look like? We’ve partnered with other investors on a lot of our deals. And I think the question we have to ask ourselves is do we want to continue to partner with other people in that same capacity? So what we’re trying to figure out is, what does it look like for us to scale? We’ve partnered with several other investors on a lot of our deals.
And the question we have to ask ourselves is if we end up buying 500 short term rentals, do we want 500 different partners? Or is there a different structure for us to do? Like, can we do it that way? We can, but it’s like, okay, if we go that route, what does our team meets look like? Who are the people that I need start hiring to be able to build a business of that scale? Or do we do something where we’re building out short-term rental developments. And maybe we’re building 10 houses at one time and that’s a totally different business model. So it’s tough to know what-

Ashley:
Because it’s also … like there’s opportunities that are attractive, but is that really what you want to be doing for the next couple of years? Is that going to fit the lifestyle you want? And I think for me, I’m trying to figure out what’s the best opportunity, but I can still live the lifestyle that I have now, like being very flexible, being spontaneous.

Tony:
But do you want a big team or do you want to manage 100 people?

Ashley:
No, because I don’t think I’d be good at it. I think people would hate me as their leader.

Tony:
For me, it’s like I did that in my WT and I already know the level of responsibility and accountability that comes along with having a big team. And I don’t want that.

Ashley:
I don’t want responsibility to other ones and that’s why I’ve been very selective with having partners and kind of the same with you is you’ve had some of the partners on the Airbnb and how many partners do you take on before you become responsible to all of these people? So that’s another thing too, is figuring out who are the people that you’re going to work with and how much is too much, and just having to hire someone and be financially responsible for them really.

Tony:
It’s tricky, right? Because obviously working with people has its benefits. And I think most of the big players in real estate are leveraging partnerships to some extent, but it’s how are you structuring those in a way that still supports you. I was talking to another investor, they have a big syndication company, they’re doing tens of millions of deals of dollars every deal and he told me that they are extremely picky with who they allow to work with them. When they first started, they just pretty much took everybody because most investors have to but as their businesses matured, they’ve been able to say, “Hey, we really appreciate your interest in working with us, but we don’t think it’s a good fit.” And I feel like we’re getting … I say we, me and my wife and our partner [inaudible 00:05:06] getting to that point in our business where we can say, luckily we’ve done well and there’s a lot of interest to work with us. And even though-

Ashley:
Selective.

Tony:
… you seem like a really great person, but I’m not sure if your interests align with ours.

Ashley:
That’s such a great point is being able to get to that point where you are kind of interviewing them instead of them interviewing you. What about managing the employees? Because you have a couple of VA’s. I have the staff at the liquor store and then a supervisor that handles our short-term rental and the liquor store and things like that. But she pretty much takes care of everything for me because I’m just not good at that. So what’s your experience with having employees and growing that? Or I guess they’re all 1099.

Tony:
Yeah, they’re all contractors. I will say this is that the relationship I have with the VA’s in our team is very different than the level of relationship I would need with people to help me scale the business in that way. Like, our VA’s help with the bookkeeping, like some background, social media type things. But if I wanted someone to come in and actually be the face of my investment business of Alpha Geek Capital, that’s a totally different kind of skillset and it has to be someone that I trust. It has to be someone that I believe is coachable, someone that I believe has the skillset, the abilities to talk to different investors and guide them through the process of buying their first short-term rental. So it would be a very, very different experience, I think, than the VA’s that we currently have.

Ashley:
I think that in a way I would be too much … like, it’s hard for me sometimes to get what’s going on in my brain and to explain it to somebody else or to put it on paper or to get it out, I guess. And then I also think that I’m sometimes too adaptable where I’ll just tell somebody just do it because I don’t want to deal with it. Just handle it yourself even if it’s not the best option. I just want to get it off my plate, I guess.

Tony:
Well, let me ask this as a follow up question. I’m rereading the Cashflow Quadrant by Robert Kiyosaki. He talks about a lot of different quadrants. And when he talks about the B, the business, it’s different than being self-employed. Right now I’m self-employed because I’m very much in the day-to-day of running Alpha Geek Capital. I would like to get to the point where it’s a B, but I’m having this struggle where it’s like, okay, if I bring somebody in, that’s us giving up a lot of the financial portion of running our business. So, what’s your take on it? Do you bring someone in, pay them healthy amounts to keep them interested, meaning you get less, but the hope is that they can scale it or do you do it yourself and kind of bootstrap it?

Ashley:
Honestly, right now, I’m at the point where I want to hire somebody. So I am talking to somebody right now to be an acquisitions manager for me, where it would be salary based. But then also he would get a cut of the pie of the properties that he brings and then eventually build it into a partnership if that worked out. But here’s the thing is I like to build businesses. I’ve built an insurance agency. I’ve built two property management companies. I’ve built all these different things, but once they’re built, the day-to-day stuff, don’t bring it near me. I don’t want to look at it. I don’t want to touch it. So that’s the thing. I enjoy putting the systems in place, building a business, and even the liquor store, that was fun to get it going. But then once it’s operational, I could care less like about being involved.
And so I think that I would enjoy building a business with somebody who’s going to run it and then they kind of take it over. And then I think that gives me the opportunity to go and create more things or more ideas. Ryan Dorsey, an investor out of Florida, but does a lot of business in Indianapolis, I talked with him a couple of times and I’ve seen on his Instagram and things like that, where he is the head of his company but he has a COO, the chief operations officer. And so basically Ryan’s the idea generator and then his COO puts it into action and creates it. So I would love to get to a point like that too where I can pretty much just think of ways to make the business better or to do different things and then have somebody that goes in and runs with it, I guess.

Tony:
How do you find that person?

Ashley:
God. It took me what, how long? Six, eight months to actually hire a bookkeeper. And I also think that what I do too, is I try and wait for a person to come to me instead of going out and actually finding a person too.

Tony:
But it is challenging. Especially if you’re taking something that you’ve invested, like actual blood, sweat, and tears into to hand that off to somebody else. It is a scary task. But I think for anyone that’s looking to scale you, you got to do that at a certain point, right?

Ashley:
When I gave up property management, so I had built two property management companies, one that had my properties and one for another investor. And when I didn’t want to do the day-to-day, I had built these companies up, there was really not a lot to change them or improve them and I was getting super bored. So I interviewed people to hire them to just take them over. And I just could not find somebody because I didn’t want to give up that control. And if something went bad, these are my babies. So instead I went and hired a property management company where if it does not go well, well, then I yank them away and give it to another property manager. And it’s not like I have an employee that I’m still having to overseeing the property management company. And if she quits one day, I have to step in and take care of it. So that was my medium spot right there was getting that third party in there instead of hiring someone or to keep doing it myself.

Tony:
It probably works in that scenario. But say for your …

Ashley:
Right, yeah. There’s other ways that that would not work at all or it’d be a lot more expensive.

Tony:
And that’s why we’re stuck because it’s like, what’s the best path? But I guess for those of you that are listening, what Ash and I really want all of you to understand is that there’s always going to be uncertainty as you grow your business. There’s always going to be so many different paths that you can take to try and get to your ultimate goals. And it’s not always going to be super clear as to which path is the right one. And a lot of times maybe there is no right answer. It’s just, which one do you like the most? Which one do you feel might give you the best benefit? I don’t know. There’s no right answer, but just try things.

Ashley:
And I think talking to people who are doing those things and seeing what their day-to-day is like. I did that job shadowing with an investor in Seattle to see what it, and I followed them around for three days and seeing what his life and his job and everything like that was like, and it was awesome. I learned things that I would really like to do and things that I would not want to do that were part of his business. So even just me and Tony talking, when we get this face to face time, this is pretty much what we talk about. Things are struggling and I’m like, “Oh, what do we do?”

Tony:
So I hope the rookies that are listening, A, that you all understand that you’re not alone in feeling the indecision or the analysis paralysis and B, that you guys can get some … I don’t know. Maybe some confidence maybe is the right word to just take action anyway.

Ashley:
And one thing that’s helping Tony and I, that we just started a couple of weeks ago is we actually picked three previous guests on the show and asked them if they would do a little mini mastermind with us, just the five of us. And it’s been going really great. We’ve been meeting once a week. It’s not like a paid thing or anything. We’re all just friends and we talk and hold each other accountable. So if you think that that might help you, having that tight knit community, just reach out to people in the Real Estate Rookie Facebook group in the bootcamp that I’m hosting and Tony is going to be hosting one. There’s accountability groups. So find those people that you can talk these things out for free and not have to pay for a therapist.

Tony:
Or pay for a therapist too. Do both.

Ashley:
I actually wanted to start this out. So there’s a couch right over there. I wanted Tony to lay down on the couch and we sit here talking about therapy.

Tony:
But these are good questions to ask. And like Ashley said, having that community around you, I think is super, super important. And if you feel like you don’t have that community, that’s what BiggerPockets is there for. The website itself, they’re like over 2 million members now. If you’re not in the Real Estate Rookie Facebook group, join that, super active, super engaged. But just start adding people to your circle, people that have achieved the success that you want to achieve, people that are on the same journey as you. And you’d be surprised at how much insight you can get from folks that are working the same path.

Ashley:
And we have Brynn coming up, I think it’s on episode 125. I think. So we interviewed her today and it will be released a couple of weeks. She talked about social media and how when she wanted to get in real estate investing, she just started following people who were real estate investors. And she muted a lot of other people on social media that were toxic or didn’t support what she was trying to achieve. And there’s so much power in social media if you use it the correct way. And I think she said it perfectly. So make sure you guys listen to that episode when it comes out about how to really get that motivation from social media.

Tony:
And last, if you guys have some advice for me and Ashley on what we should do in our businesses, please let us know.

Ashley:
Maybe we should have the next Rookie Reply, we should actually hire a therapist.

Tony:
Or like a business coach, someone to come on.

Ashley:
I think I’d be scared for what they’d the say to us. Thank you guys so much for joining us today live from viva Las Vegas. I’m Ashley and he’s Tony. You guys can check us out on Instagram @wealthfromrentals or @TonyJRobinson. Thank you guys for joining us for this Rookie Reply. And now we’re going to go eat.