From Teaching Spanish to Teaching Accounting: Shannon Weinstein’s Journey

September 26, 2023

Title: “From Teaching Spanish to Teaching Accounting: Shannon Weinstein’s Journey”

Episode: 199

Do you want some honest and helpful information to help you achieve financial freedom?

We have Shannon Weinstein for today’s episode of Profit First for REI podcast. Shannon is a financial expert, podcast host, and entrepreneur.

She is ready to take complicated subjects and make them very simple. Shannon also talks about reasons why we don’t pay ourselves enough. Learn more about this topic and the psychology behind it.

Enjoy the show!

Key Takeaways:

[01:19] Introducing Shannon Weinstein

[03:22] When Shannon started to help people

[06:32] The Language of Business

[13:02] Leaving her corporate job

[18:46] Why don’t people keep more of what they earn?

[21:26] Shannon’s work as fractional CFO

[29:12] About tax laws

[33:05] Connect with Shannon

Quotes:

[06:45] “When you speak it (language of business)… I forget other people don’t speak it, you don’t have that perspective.”

[18:45] “Why don’t people keep more of what they earn?… The main reason I think is because they are not paying attention to what the number is to tell them.”

[26:15] “You never really gonna be feel ready… you have to start the habit now.”

Connect with Shannon:

Website: https://www.fitnancialsolutions.com/

Tired of living deal to deal?

If you are a real estate investor or business owner who is tired of living deal to deal and want to double your profits, head over here to book your no-obligation discovery call with me. Either myself or someone from my team will hop on a short call with you to get clear on your business goals, remove any obstacles holding you back, and map out a game plan to help you finally start keeping more of the money you work so hard to make. – David

Transcript:

Speaker 1 (00:00):

They’re not paying any attention to what the numbers are trying to tell them. I think that their numbers are basically screaming off that piece of paper, off that p and l and balance sheet, but you are not looking at it and not willing to listen. And it’s okay because we haven’t been taught how to read this stuff. It’s like reading your blood work at the doctor. You’re like, I don’t know if 2.4 is good. What does this mean? They’re arbitrary metrics and you need somebody to interpret them for you to tell you how to apply them in your life or what they’re trying to tell you. And I think when you can equip yourself with either the basic skills to do that or a really good professional who can translate it, it empowers you to the nth degree to take the actions in your business you need to be. But if you’re not looking at your numbers, then you’re kind of operating off of intuition and gut and it’s going to take you a lot longer to get where you want to go.

Speaker 2 (00:46):

If you’re a real estate investor who’s sick and tired of living deal to deal, then welcome home. Hear from everyday real estate investors just like you, and discover how they’ve completely transformed their business by taking a profit First approach. This is the profit first for R e I podcast, where we believe revenue is vanity. Profit is sanity. It’s time to start making profit a habit in your business. So here’s your host, David Richter.

Speaker 3 (01:14):

This is another episode that I absolutely love because I know it will provide value to you. I’m having Shannon Weinstein on and she can take complicated subjects and make them very simple. She talks about a lot of reasons why we don’t pay ourselves enough and the psychology behind that and what she’s seen. And honestly, I believe that if you listen to this one, you will come away and you could keep more of what you earn right from this podcast. I’m super excited for this episode. Thank you for listening. Appreciate you. I am super excited for this episode, the Profit First r i podcast. I have Shannon Weinstein here. She is a fellow fractional C F O that runs her own business. She’s incredible. She has a podcast. Keep What You Earn. I absolutely love it. We were on there talking about all the nerdy stuff that you hear from me all the time and from the guests and people, and she’s going to give you some great stuff. She puts things on the bottom shelf, which is incredible because it’s like, I want you to be able to do that, and this is where I want to invite people from other industries and just helping you know that this is a common problem out there. So Shannon, thank you so much for being on here today.

Speaker 1 (02:18):

Thank you. And I love the phrasing of putting things on the bottom shelf. That’s such a cool concept. I love it.

Speaker 3 (02:23):

Yeah. Well, honestly, I’m a bottom of the shelf person. I’m very simple. People look at me and think, I look smart because of the glasses used to have braces, all that stuff. Same. I part my hair. And then it’s like, well, I need stuff simple too. So that’s why going down this road, but I did, whenever I’ve heard you speak or whenever I’ve ever listened to your podcast, you just make things very simple. I think that’s a gift. That is definitely a gift and a talent and a skill. You can work on it, but it’s something that I think comes very naturally to you because even before this, okay, here, if you’re listening to this, I’m giving you a little bit of sneak peek. Before this, she even was talking about something. I’m like, I love how she phrases things. I just talking about the money and just the things that we were talking about, which I want to explore here on the show. So let’s go into that. So let’s go into how did you even get to have a podcast, keep what you learn into this fractional C F O world. What was the epiphany that I want to help entrepreneurs who struggle with the money?

Speaker 1 (03:22):

So it actually dates back to in high school I wanted to be a language teacher, so I wanted to teach Spanish. It was my favorite subject because you know how we’re taught in high school and middle school, what’s your favorite subject? Make that a career. That was the default kind of gift and sign that was like, oh, you’re good at this skill, then you should just do this the rest of your life. Like, oh, okay, I guess that’s what I’ll do then. So I was thinking, oh, I love Spanish. What can I make Spanish into a career for? And I thought teaching, I love to teach. This would be great. So I ended up taking an accounting class on a bet with my dad in high school and he said, and by the way, he’s an accountant, but he said, if you hate it, I’m never going to bug you about your career again.

(04:04):

I’ll let you do whatever you want. You don’t have to be an accountant, you don’t have to do this business, but if you love it, you need to major in it. And I was like, okay, there’s really no not winning here. It’s a win-win. Either he leaves me alone or I get to do what I love. Jokes on you dad. And then lo and behold, joke was on me because I loved it. I majored in it and he had another C p A in the generation. So what ended up happening though, the way he sold it to me, which directly answers your question, is because I have an obsession with teaching and I love teaching language and I happen to choose the language of business. So my dad convinced me to go into accounting because he said, if you want to teach a language han, this is the language that nobody speaks.

(04:48):

This is the language that people should be speaking and if you understand it, you are wasting your gift if you’re not using it. And that really hit me when I was 17. I said, okay, that makes sense. This is the thing I’m uniquely positioned to teach, and I truly believe that. So ever since then, I have just been finding every excuse I can to train, to teach, to develop even the employees who worked beneath me in corporate and in big four. And I’ve just always kind of come from this heart of a teacher. So that’s what drove me into starting my own firm and eventually creating content on a podcast platform, which now we are over two years in 400 episodes in doing five a week. And it’s basically my favorite part of my business, which I thought would not be the case at all when I first started. I was so scared of like, is anyone going to listen to this? Am I going to be able to be consistent? Am I going to dread waking up and getting behind this microphone? It’s a chore. And I don’t know how you feel, David, but I feel like this is one of the things that lights me up the most is actually getting behind the microphone, having conversations like this and getting to interact with entrepreneurs and teach them.

Speaker 3 (05:55):

Yeah, I a hundred agree. I love being able to come on it and just give that knowledge and being able to help people because we can’t help everyone in your business. You’re not going to be able to reach as many people as if you get behind the microphone and people really want to learn. I mean, then you have that podcast and you’re very consistent and that’s awesome. You said over, did you say over 400 episodes at this point? Yes. There you go. When you know someone is serious, two years, 400 episodes, she loves what she does. I want to go back to what you said though. You said the language of business is the accounting world. Have you found that to be true what your dad said that most people don’t speak it?

Speaker 1 (06:32):

Absolutely. Would you agree? I think

Speaker 3 (06:34):

So. Yes. I would definitely agree. I just want to know from your perspective,

Speaker 1 (06:39):

Years. A hundred percent. A hundred percent. And here’s the funny thing is when you speak it or when you’ve been speaking it since I was a teenager, then I forget other people don’t speak it. You don’t have that perspective. You kind of go, oh, I learned this when I was 12, 13, 14. I learned about stocks when I was 12 because instead of buying a toy, my dad said, instead of buying that toy you want or that Barbie or whatever, I’m going to buy you a piece of the whole store. And I was like, what? And we went into toys us and he literally said, I’m not going to buy you that thing, but I’m going to buy you a piece of everything in here. And I was like, that sounds awesome. What are you talking about? That’s great. And he got me a share of toys, Rus

Speaker 3 (07:23):

Uhoh, toys R Us.

Speaker 1 (07:27):

Well, yeah, that was in, we will say in the year like 1998 or something. But he got me a share in the company, and that was where I finally learned what a share is, what a stock is, how the stock market works. That’s

Speaker 3 (07:42):

Such great info.

Speaker 1 (07:43):

It is. And I’m like, of course, 37 year old Shannon is like, oh, that’s awesome. And 12 year old Shannon was like, this is bull. This is worse than socks for Christmas. Dad. What the hell are you doing? I want the Barbie. I’m 12. So if you look back and you go, what a blessing and a gift, but also going like that totally sucked in real time. But yeah, it taught me a lot. And I didn’t realize the gift he was truly giving me, which is the gift of education that I could reap the benefits of for decades beyond. So that was huge.

Speaker 3 (08:16):

I like what you said also. You said that you forget that other people haven’t learned this, so you were speaking it at an early age and you’ve become a master. When did you start, okay, I’m going to ask you. Do you think it’s always been a gift for you to make things simple? Or did you go through a growth curve of like, oh shoot, I have to scale this back or no one that’s going to know what I’m talking about? I feel like it’s a gift for you.

Speaker 1 (08:41):

Yes. So I was in a firm, I was always rewarded for sounding smarter than other people, as most of us are in accounting, right? Right. Yes, you are praised for how smart you sound or appear or what kind of aura you give off that you are smart. So what was interesting was I realized that that’s what was rewarded in my career. So I was constantly chasing this way to sound smarter. And then I realized as I was talking to my friends and colleagues that I worked in fitness part-time at night, I worked as a Zumba instructor for 10 years now. And what I realized was back in, we’ll say it’s like 20 13, 20 14, I was thinking they were asking me questions. My instructor friends, I have a 10 99, what does this mean? W 2, 10 99, my taxes, schedule C, all those things. They’re throwing these things at me and they’re saying, how does this actually work?

(09:37):

And again, I accidentally, we’ll say unintentionally made them feel stupid because I was explaining it and I was going, you guys don’t know this stuff. And I wasn’t trying to be judgmental, but it definitely came across that way because I realized it didn’t hit me until that point because I had been surrounded by other smart accountants my whole life and always been the dumbest one in the room that had to humble themselves to ask questions up, but then had to kind of earn their place in the room by trying to say something smart or trying to appear smart to almost justify your existence. So now I’m like, wait a minute, wait a minute. That’s not what’s going to win me relationships. That’s not what is going to win me in these conversations or let me teach anyone anything if they don’t understand it. So I actually had to make an active decision that if I was going to do this as a business, or if I was going to start my own company, I said, wait a minute, I need to go back to how did I learn this when I was 14, when I was 15, when I was 18, whatever it was.

(10:40):

I go, how did I learn this 10, 15 years ago? What were the ways that I conceptualized this? What was in my notebook in high school? How did I think about this back then in simpler terms? And then I just started finding all of these analogies and finding life examples and thinking about how it made me feel to learn it when I got it. And then I had to find parallel principles, parallel examples. I’ll give you one example. What I realized was people were not paying their taxes throughout the year. They were waiting until the April bill to hit. So they have these massive tax bills in April. They did no tax planning, but they were earning money throughout the year. And I said, okay, imagine you’re at a hotel and you’re ordering drinks every single night and you’re putting it on the room, but you don’t check out until next April.

(11:28):

Put it on the room, put it on the room, put it on the room, put it on the room. I go, what you’re doing is now, you’re surprised when that paper comes under the door and it’s like 18 pages long of all the margaritas you ordered over the past year. And it’s like you’re just keep putting it on the room. If you’re not paying it throughout the year or at least setting aside the money, the bill’s going to come. So analogies that make sense to people, like, oh my God, yeah, I’ve totally been there where I checked out of a hotel. And I’m like, who the hell order all these margaritas? Right? Everybody’s been through those experiences. And when you can bring in an experience that’s relatable that isn’t about the money, that’s where it hits home. And people go, oh yeah, now I totally get why that is the way it is. But when you try to explain it with the science and the tax code and the jargon, it doesn’t sink in.

Speaker 3 (12:13):

That makes sense. And man, I could just listen to you and your analogies all day long. This is great. I hope that was awesome. I do want to point out one thing too that you said that if you went down this road the same way you wouldn’t be winning relationships. I think that’s so great because that’s not just in the accounting world, but just in business in general. If you’re not communicating to win relationships, you’re really losing. No matter if you think you’re winning or you think you’re smarter than the other person, it’s not going to end up well. So I thought that was a piece of gold right there. Plus I love that analogy. That was so great of putting it on the room. So I want to ask, when did you make that leap from the Big four and working with all those people to actually owning your business? Why did you take that leap and yeah, just what was the whole story

Speaker 1 (13:02):

There? So many reasons to leave. I feel like there’s no, it’s almost a silly question at this point. Why leave a corporate job where you’re chained to a cubicle for 10 hours a day? What could ever come across your mind that would make you not want that? But yes, I’ll explain what triggered the why then and why. Then in my career too. So I reached a certain point where I was at a firm. I knew I didn’t want to make partner. I did not aspire to not see my family and work these crazy hours and be in the city all the time and be frankly, sucking up to other clients, other partners, and playing the politics game. I didn’t really want to do that. I said, I just want to be respected for what I know. And I was even told at one point that the main reason I was going to be on the partner track was because of my gender, because of quotas. I was the last woman left in a class of 24, 6 years later.

(13:55):

So they kind of looked at me and they were like, you’re going to make partner. And I was like, oh, not for all the work I put in and all the other, the blood, sweat and tears, but because I lasted this long and I happened to have this type of genetic makeup, this is so silly. So I just said, you know what? It’s all too superficial. And not to mention, I got a really short bereavement leave. When my dad died, I really knew where I stood when times were tested with the company. So I said, I know this isn’t for me. I went to a bunch of other corporate jobs, but I realized that all they were ways to make a paycheck and pay a mortgage. I wasn’t deeply connected to them. I didn’t feel the mission. I didn’t feel that I contributed heavily or that I kind of started having these superficial relationships with my companies I worked for where I wouldn’t get too emotionally invested because I got hurt so bad by the first one. So I kind of kept an arm’s length distance and was like, I’m going to do my work. I’m going to make my check, and I’m not going to think about you guys. I’m not going to stress myself out over you guys. And that worked for a while. But then I said, I want fulfillment. I want to be emotionally invested in something. I don’t want to be a vacuum of. Just show up, do your work, go home and try to find fulfillment elsewhere.

(15:07):

So I decided to start my own practice on the side. I started in 2019 and I got really lucky because my whole job went remote in 2020 and the practice took off because 2020 was a massive opportunity year for accountants between P P p idle loans, the uncertainty around the economy, cashflow issues, people were really craving our help at that point. And I kind of struck the right time to be almost a year into building my business, and that just kind of poured the gasoline on the fire and enabled me to build my business virtually. I was sitting there with two laptops every half hour, toggling between my two jobs. And yeah, it was crazy. But I left because I really wanted to find that fulfillment and I wanted to be part of a bigger mission and help real people, real business owners that were the backbone of the economy.

Speaker 3 (16:01):

That’s so good, and it’s so heartbreaking that these corporate monsters basically just in suits don’t understand what’s really going on. I feel, I don’t know, do you feel like in 10 years from now when our generation starts taking more of that over, do you think it’ll change in the corporate real? I feel

Speaker 1 (16:21):

Like I think it has changed. If we’re talking about that conversation around my partner track that happened over 10 years ago,

Speaker 3 (16:33):

I feel like it’s going more that direction, but that’s just still disheartening to hear stories like that, and it’s like

Speaker 1 (16:39):

It’s all too common. But I do think it leaves a scar. So even though it may not be happening, I think it leaves a scar on my generation and now has led us to discourage these types of careers or for us to be badmouthing them or talking about the trauma, and then now people are listening to that and going, oh, that sounds terrible. I don’t want to do that. And yes, I believe it has changed, but I think that there’s still a lot of scars left on it that are hard to erase.

Speaker 3 (17:05):

Yeah, well, that’s a really good way to put it, but you’re the queen of doing that. Okay, so let’s talk about the business. Who do you work with? You’re a fractional C F O, so to explain what you do and what type of client that you’re working with and want to work with.

Speaker 1 (17:20):

So we work with growth-minded business owners who are focused on their goals and helping their business achieve those goals. So although that sounds like a broad brush, what we’re really trying to do is help business owners who maybe haven’t gotten a ton of exposure to the numbers before in an approachable way. And we want to make sure that much what your business does called simple C F O, we try to bring simplicity into the mix and say, Hey, it’s actually a lot simpler than you think it is, and we’re going to help craft an activity plan or a set of goals that will help you take the actions you need to drive those outcomes. But we focus on service-based, but we have a few product businesses in the mix, but we’re really looking for that founder profile that is coachable, that wants to grow, that is hungry, motivated, and they have a big why. They have to have a really big why beyond. I want to make a profit just to make a profit. My founders, I love that. We have a mission right now for one of my founders to send her daughter to private school, and we have another mission for one of my founders to open a new location so that they can get a second home near where their kid goes to college.

(18:31):

All of these stories, the story that backs it up, I just love those types of stories where we can help a business owner really make a tangible difference in their own life.

Speaker 3 (18:39):

So let’s get into what you really like talking about. Why don’t people keep more of what they earn?

Speaker 1 (18:45):

Oh gosh, why don’t people keep more of what they earn other than tax law? Cite the I R C, the Internal Revenue code. That’s why. But the main reason I think is because they’re not paying any attention to what the numbers are trying to tell them. I think that their numbers are basically screaming off that piece of paper, off that p and l and balance sheet, but you are not looking at it and not willing to listen. And it’s okay because we haven’t been taught how to read this stuff. It’s like reading your blood work at the doctor. You’re like, I don’t know if 2.4 is good. What does this mean? They’re arbitrary metrics and you need somebody to interpret them for you to tell you how to apply them in your life or what they’re trying to tell you. I think when you can equip yourself with either the basic skills to do that or a really good professional who can translate it, it empowers you to the nth degree to take the actions in your business. You need to be. But if you’re not looking at your numbers, then you’re kind of operating off of intuition and gut, and it’s going to take you a lot longer to get where you want to go.

Speaker 3 (19:44):

That’s good. See, isn’t she great? The blood work, that is such a great analogy of,

Speaker 1 (19:50):

I mean, how many times have you gotten your blood work back and you’re like, this is meaningless until I have the interpreter to tell me the legend or the key code of where should it be? What does it mean? What is this chemical name I can’t pronounce? And I got my blood work back. I had to call my doctor, and I was like, and that’s where it comes from, David. I said, now I know how they feel. I sat in that and I said, oh, this is how my founders feel when I give them a p and L.

Speaker 3 (20:18):

Oh.

Speaker 1 (20:19):

And I started to relate to that because I knew I couldn’t relate. Like I said, I came from the number language. I can’t relate to somebody who doesn’t understand p and L at this point, but I can relate to them on a common ground area where I go, well, where do I have that experience elsewhere in my life that I can connect to that emotion? And that’s exactly where I got to. Yeah.

Speaker 3 (20:39):

Oh, that’s so good. It’s like putting yourself in those situations, and then you have the presence of mind and self-awareness to be able to say this is they think. And that’s why I fully endorse Shannon, use her her business, use her services, listen to her podcast. She makes things very, very simple. And she caress. She caress about you as a human being and wants to make sure you get to where you want to be and as a business owner. Okay, so let’s keep going. So you’ve been in this business. How long have you been doing this? The fractional C F O side?

Speaker 1 (21:11):

Fractional C F O game? About four years now.

Speaker 3 (21:13):

About four years. Awesome. So then you’ve worked with multiple owners over that time. Do you also do the bookkeeping taxes, that type of stuff, or you stay away from that? Or do you just do the C F O or do you help people with bookkeeping as

Speaker 1 (21:26):

Well? Yeah, I indulge my inner control freak. We do all of it because I don’t like to roommate on a business. I go, I don’t want a roommate. I want the house to myself. So I basically said, okay, we want to do everything end to end and do it our way and have control over the entire lifecycle and value chain. The last thing I want to do is be passing this baton in a real race going, where’s the bookkeeper? Where’s the bookkeeper? Okay, thank you. Finally, I get the baton. It’s like, oh, I have two days to get this done now. So we have control over the timeline of the project from end to end, and I like that. But yes, we do the bookkeeping all the way through the tax preparation and tax strategy. We are equipped to do all that, but actually what’s exciting is currently in my business, we’ve been using contracted bookkeepers, different people that I know and trust who specialize in different industries, and I’m now moving into an in-house employee model. So we’re bringing in a more permanent team right now as my company grows. I’m really excited about that, that we’re going to have installed a core team that serves all the clients consistently, and we have control over the entire process. So I’m really excited about that change coming up.

Speaker 3 (22:31):

Yeah, that’s awesome. And okay, being the business owner, how does your feelings for life in general plus business compared to when you were in the corporate world is a night and day?

Speaker 1 (22:43):

Absolutely. I’m a different person now with a outlook on the potential of earning money, how money should be earned, how money should be spent, the meaning, the value of money, totally different. I think when you are a business owner, there’s a lot that has to change in your mindset around how you earn money. Because we were taught, I say as a society and myself included, that the more you work, the more you make, and very true. And then to some degree, we feel guilty when we earn a lot of money we didn’t work for.

(23:22):

It’s not unique to me. I know I felt this way and a lot of other people did too, where it can’t be that easy. It’s not supposed to be easy. We’re supposed to work hard and make money. And those with a really good work ethic typically struggle with the idea of, wait, you’re telling me that I could sell something online or I could charge this much for my services and I just make that much money? And they grapple that, and they’re like, but I only did an hour of work to earn that. Yeah, yeah. Isn’t that awesome? But they have this discomfort and this sense of guilt of, but I didn’t work that hard for it. And even accountants too, who are used to the billable hours to think about that, they’re like, oh, it takes me 15 minutes, so I’m only going to charge a hundred bucks. And I go, but that 15 minutes generates 50 grand in tax savings for your client. So what is the value of what you’re doing versus the value of what you are doing? What is the value of what you’re producing versus what you’re putting in?

Speaker 3 (24:23):

And if you’re listening to this as a real estate investor, I think if you’re wholesaling, you’re right in that category. Like, Hey, I just did my first, oh my gosh, this really works. I made $10,000 and I made a couple phone calls and helped someone out where they had a burned out house, or they’ve got something that wouldn’t sell on the market place. And it’s like, yeah, I can see that in all areas in service-based businesses selling online in the different spaces that is so prevalent of just, oh, man, is this okay? And then, okay, let’s talk about this. So let’s say they make a lot of money. Do they have a hard time paying themselves anymore? Oh,

Speaker 1 (25:01):

All the time. Yeah, all the time. I mean, first of all, profit First exists for a reason. Yep. Profit First exists for a reason. If Mike Michalowicz and then David Richter now have, if we’re putting out books explaining how to do this, it’s because people aren’t doing it. People aren’t paying themselves, and there’s paying yourself and there’s paying yourself first. And I believe wholeheartedly in paying yourself first, because otherwise you will take the scraps leftover and you will justify not paying yourself because of priorities. And it’s a huge issue with business owners that their big why is, let’s say to put their kid through college, but they’re not actually taking any money out of the business. I think they’re perpetually in this sort of state of, well, when I hit this point, I will have made it. It’s almost the same rutt that we get in when we’re trying to quit our job and start our own business.

(25:52):

Like, oh, when I save this much money or when we have this much money, then we’ll talk about having kids. Or when we do this, then we’ll buy the house in Costa Rica. All of these things, we’ll do this when, and I go, there is no, when there is no, you’re not going to wait until you cross that peak. You can do it now. You could do it later, whatever, but you’re never really going to be feel ready, and you’re never really going to feel like you have enough money to pay yourself. So you have to start the habit now of just embedding that in your existing habits, your existing routine of how you run your business.

Speaker 3 (26:27):

Yeah, that’s so great. And I love what you said there of pay yourself is different than pay yourself first. And I don’t think I’ve ever heard anyone say that, but it makes a lot of sense where you can be paying yourself, but then if you aren’t paying yourself first, like you said, you bump yourself off and then you’re a lower priority. Anything you pay above yourself is a bigger priority than you. And it’s like, well, if you go down, what happens to the business? So it’s like, I think that was good. This

Speaker 1 (26:54):

Is good. Yeah, and I’ll add this too. When I brought my employee in, I was setting her salary and I was setting up, again, cashflow forecasting, all the things we use, we use it on myself, and I said, I need to have enough of a reserve to pay her. And I had her salary set, and then I also plugged in my forecast. I said, well, if her salary is X, my salary has to be raised to Y because I did not want to make less than her.

(27:18):

And I said, I’m going to have to level up my salary because I don’t want to feel like I’m paying my employee more than I’m taking home. And that was a big thing for me was I want to make sure that I am one of the heaviest paid employees in the company, or I’m in a position to be because I want to feel like that is what I’m contributing in. I don’t want to take the foot off the gas pedal and be like, well, I’m only making this and she’s making this much money and start resenting the work she’s doing because she’s making more than I am. I didn’t want that to be a factor at all. I said, until I can afford to be paid as much as my employee is, then I can’t afford an employee.

Speaker 3 (27:58):

Please listen. Are you listening to this right now? Please, for the love of God, take what Shannon’s saying and run with it. I don’t want you, if you’re feeling like that, like, oh, I need to starve and I need to not do this. And then you’re in that mindset right now. Press rewind, listen to that again. This is so good. Han, this has been awesome. Is there any other parting wisdom that you want to say before my last question?

Speaker 1 (28:25):

I will just add one more thing that I had mentioned to you before when we were chatting, and that is the i r s are amazing people. A

Speaker 3 (28:34):

Lot of get people mad on this show for sure.

Speaker 1 (28:36):

I know

Speaker 3 (28:37):

Real estate investors.

Speaker 1 (28:38):

I know, right? But I’m talking about the people and there’s a lot of fear around the I r s and a lot of this stigma. They’re this evil organization and this villain in a movie, which is hilarious to me because even though, yeah, even so understand, first of all, our legislative branch, we go back to social studies in fifth grade. Our legislative branch writes the law. The I r s is just there to enforce it. They’re given the book and say, go do this. So they’re not, I go talk to your Congress people if you don’t like the tax laws, number one. But number two is with the I R Ss itself. I have spoken on the phone with them a lot at length, lots of time, lots of time on hold relative to the time I’ve spent on the phone with them. But I’ve been chatting with them and they are the nicest Midwestern sweet family people working from home, just making it work.

(29:32):

And it really does take a lot of stigma out when you realize that they’re kind of on your side. They’re very flexible, they’re very cool to work with and cool to talk to that if you get a letter, if you get anything from the I r S, just know it’s probably some intern or some woman in Utah stuffing an envelope and sent it to you. Don’t put so much weight of fear on that thing. Half the time they’re wrong anyway because the intern sends them. So you really have to take a lot of this pressure off of, oh, the I r s, they really are super, super flexible and nobody’s going to jail. Don’t worry. It’s not going to happen.

Speaker 3 (30:12):

Awesome. Well, that’s encouraging to know that they’re real and they’re nice people behind it. We just, especially this group, if you’re listing, if you’re a real estate investor, I don’t think you can go to a real estate conference or a meetup or whatever without someone slapping the i r s around. So it’s nice to know to hear from someone who actually is talking to them on a regular basis that they’re humans too, and that they’re just forced to. Yeah, I feel like the same group that’s listing now doesn’t like their congressmen either. So I mean, yeah, they definitely sit both sides of the fence there.

Speaker 1 (30:42):

Oh yeah, totally. I feel it too. But just know that they’re the same people who work at the D M V be patient. It’s the government agency. They’re just a government employees and they have families too, and they’re normal people. So if you do ever have to interact with them, I just want you to just keep that in mind that they’re human.

Speaker 3 (30:59):

Well, let’s go back to what you said before. You said, I knew by having these conversations, I wasn’t winning relationships. Same thing with them. You’re not going to get the outcome you want. If you go in there with your fighting gloves on and you’re about, you’re punching them through the phone, that’s not going to help you. That doesn’t help in any situation. Has that ever helped you as a human being?

Speaker 1 (31:21):

It’s like customer service. You want somebody to do what you want. You have to be really nice to them. And I’m not saying fake nice, but genuinely come in with a smile on your face and say, thank you so much for picking up the phone. I really appreciate your time. How are you doing today? And it goes a long way just to have a little more humanity with everybody.

Speaker 3 (31:40):

Yeah, that’s really good, man. We could stay here all day. But Shannon, this has been awesome. I wanted to point out that when in relationships, comment earlier was incredible. I want to make sure that we do that in our business, but then just as human beings, whether that’s an I r S agent or whether that’s a virtual assistant that you get a call from or whatever, just be a human because those are humans there. I like that you work with growth minded business owners that have a big why, making sure that you have that why. And sometimes, I’m sure, Shannon, you even guide people to their why because they don’t even know what they’re wanting. But I love how you had those examples of those people making sure you’re paying attention to the numbers, making sure that if you don’t know something, get around someone like Shannon who knows how to make it simple and can really help you get to where you want to be.

(32:25):

I love what you said. Pay yourself is different than pay yourself first. And it’s like, please, for the love of God, pay yourself first. So you actually get to where you want to be. And then how she close with that. If there’s someone on your team and they’re making more than you, how can you get yourself to be able to be above that right then? Because it’s not bad. It’s not bad for you as an owner to make money and the psychology of like, you can make money and you can make money where you’ve built a business and systems and processes and people or whatever, and you are making money and you don’t have to feel bad. I think you touch on so many things that just hits at people’s core. Hits at my core too. This was incredible. How do people find you? How can they get more of Shannon?

Speaker 1 (33:05):

So more of me. There’s no shortage of that at keep What You Earn, because we are releasing five episodes a week, and I absolutely love it there. So keep what you earn.com or you could just look for, keep what You Earn in any podcast platform. That’s where you can find more of me

Speaker 3 (33:18):

Cool. If they want to work with you, what’s your website?

Speaker 1 (33:21):

You can actually go to keep what you earn cfo.com, and you’ll be able to get to my website where you can find out more about our C F O services about working with us and what we offer.

Speaker 3 (33:30):

Awesome. So there you go. I fully endorse Shannon. She’s amazing at what she does. She has the gift of making things simple, and she cares. She cares about you. And as I always end the show, if you want simple C F O in your life because we work with real estate investors, go to simple cfo.com. We can help you keep what you earn as well too. And I just, man, she has inspired me to make things even simpler in my life and how I communicate. So this has been incredible. Thank you so much for being on here. Remember also, if you’re listening to Make Profit a Habit in your business. And then Shannon, thank you again for all the value provided today.

Speaker 1 (34:07):

Thank you.

Speaker 2 (34:08):

This episode of The Profit First for R e I podcast is over, but there are plenty more where that came from. Are you ready to learn how David and his team can help implement the Profit First system in your business? Schedule a discovery call@simplecfo.com right now. We’ll see you next time on The Profit First for r e I podcast with David Richter.

Title: “Profit First Strategies with Jay Conner: The Power of Private Money”

Episode: 242

There are 15 reasons to love about borrowing private money over traditional money. One of them is making your own rules for your private money.

In this episode of Profit First for REI podcast, Jay Conner, a nationally renowned real estate investor and the king of private money. He talks about how private money works.

Jay helps you get your money from private lenders and will share with you the mindset that will get you money in the door without you ever having to worry about it.

Listen and enjoy the show!

Key Takeaways:

[01:01] Introducing Jay Conner

[05:00] Introduction to private money

[08:30] The Great News Phone Call

[11:23] Why don’t you use your own money?

[13:18] Maintaining relationships with private lenders

[15:40] Private money vs traditional money

[22:05] Things that make them want to recommend you

[25:18] Advice for real estate investors

[29:01] Connect with Jay Conner

Quotes:

[07:34] “If you are talking about private money and raising private money with an individual and you got a deal for them to fund, you already sounded desperate.”

[12:07] “If you want to scale your business, private money is the way to go.”

[16:05] “In this world of private money, we make the rules. We set the interest rate, we sent the length and all of that.”

Connect with Jay:

Website: https://www.jayconner.com/book-details/

Tired of living deal to deal?

Transcript:

Speaker 1 (00:00):

I got 15 reasons I love private money over traditional money. I won’t share all 15, but the biggest one is it puts you in the driver’s seat. The traditional way to borrow money is you go to the bank and get on your hands and knees and you’re begging and chasing. Well, they are making the rules right? Like the lender is making the rules. But in this world of private money, we make the rules, we set the interest rate, we set the length of the note and all that.

Speaker 2 (00:34):

If you’re a real estate investor who’s sick and tired of living deal to deal, then welcome home. Hear from everyday real estate investors just like you, and discover how they’ve completely transformed their business by taking a profit First approach. This is the profit first for REI podcast, where we believe revenue is vanity. Profit is sanity. It’s time to start making profit a habit in your business. So here’s your host, David Richter.

Speaker 3 (01:01):

We have Jay Connor back on the podcast. I love Jay Connor. He helps you get your money, the money from private lenders and that whole framework and process, but he does it from a passion and a place of heart. And servant Teachership. I feel like he goes out there and is a servant teacher of how private money works. Listen to this episode. He gives the magic question he tells about desperation and private lending, and I thought his perspective was so good, and then ultimately the mindset that will get you money in the door without you ever having to worry about it. So listen to this episode. Can’t wait for you to get value from it. Thank you for being a listener of the Profit First. RII podcast. Have a great episode. Hey, here’s the profit first RI podcast. Really excited to have Jay Connor back because he’s the came of private money. And this is where I love to go into this topic because I don’t care what kind of business you’re in, you probably need help with this, but especially if you’re in the real estate world, this comes up all the time at every event I’m at with every conversation I have. So we’re having the cane here talk about private money today. So Jay, thanks for being on the show.

Speaker 1 (02:07):

Hey David, thank you so much for having me come on here to talk about my most favorite topic. Of course, that being private money. And why is that? Because private money’s had a bigger impact on our real estate investing business than any other strategy that we’ve implemented in our business.

Speaker 3 (02:24):

Why did you go down that road though? I mean, you teach this all the time. You’re helping a ton of people, like anyone I’ve ever talked to that works with you is like he taught me how to do and I got money and it actually works. So I mean, how did you even go down that road where it made a difference on you and then you wanted to get it to others?

Speaker 1 (02:43):

Well, I actually backed into it. I didn’t do it on purpose. So here’s what happened. So my wife, Carol, joy and I, we’ve been investing in real estate, single family houses, other real estate full time here in eastern North Carolina since 2003. And here’s what happened. From 2003 until 2009, David, all I knew to do in my real estate investing business was rely on the local banks to fund my deals. I mean, all I knew to do was go to the bank, get on my hands and knees, put my hand underneath my chin, raise my skirt up so they could look at all my personal financial statements and stuff and actually beg to get my deals funded. That’s all I knew to do. And so I had a big wake up call in January of 2009 after being in this business here in Eastern North Carolina. I called up my banker.

(03:38):

I told him about these two deals I had under contract in Newport, these two single family houses. And David, I learned like that over the telephone that my line of credit had been shut down with no notice. My banker, his name was Steve, and the bank was bb and t at the time. I said, Steve, what in the world are you telling me? My line of credit is shut down. I got two deals under contract. You gave me no notice. Why is the bank closing my line of credit? He said, Jay, don’t. There’s a global financial crisis going on right now. I said, no, but now you just gave me a global financial crisis. Financial crisis, yeah, I ain’t got no way to fund my deals. And I got ’em under contract. So I hung up the phone and here’s what happened, David. I sat here and I asked myself a very important question.

(04:27):

And so I’m going to share this question with your audience right now. This question I’m going to share with you will help you solve any problem you’ve got. I don’t care if it’s business, financial, career, health, relationships. I don’t care what your problem is. By the way, David, these people going around and saying, any problem, you got some opportunity I want to throw up. I didn’t have no opportunity. I had a problem of not funding my deal. So here’s the question I asked myself. The question I asked myself was, Jay, who do you know that can help you with your problem? And when I asked myself that question, I immediately thought of my good friend Jeff, who lived in Greensboro, North Carolina at the time, and he was investing in real estate. And so I called him up and I told him what happened. And he said, well, Jay, welcome to the club.

(05:18):

I said, what club? He said, the club of the bank shutting you down and losing amount of credit. They shut me down last week. I said, well, how are you funding your deals, Jeff? He says, well, have you ever heard of private money? And I hadn’t. So Jeff told me about private money. He told me about self-directed IRAs and how people can use their retirement accounts and funds that they currently have and move them over to a self-directed IRA company and then loan that money out to us real estate investors, either tax deferred or tax free depending on the type of account they’ve got. Well, that just opened up my whole world. I’d never heard of that. And so what did I do? How did raise $2,150,000 in less than 90 days after being cut off from the bank? Well, here’s what I did, and here’s the secret sauce I put on my teacher hat.

(06:10):

So I put on my teacher cap, which is my private money teacher cap, and I just started teaching people in my own network what private money is, how they can earn high rates of returns safely and securely. And what’s interesting, Carol, joy and I, we got 47 private lenders right now. Not one of them had ever heard of private money and private lending. Not one of them had ever heard of self-directed IRA companies and what a third party custodian is. That’s important by the way, to establish a relationship with a self-directed IRA company because over half of my private lenders are using their retirement funds. And if I didn’t have that relationship to introduce them to move their retirement funds over, I’d be missing out on over half of my private money. So how did I go about raising all this money when I was cut off from the banks?

(07:02):

I led with a servant’s heart. I led with education. And here’s a really, really important point. I separated the activity. I separated the conversations of telling people what private money is and how they can earn high rates of return safely and securely and having a deal for them to fund. You see, desperation has got a smell to it. And when you talk about is that not true, David? Yeah, very true. So if you’re talking about private money and raising private money with an individual and you got a deal for them to fund, you’re already sounding desperate and you’re not even trying to sound desperate. So we don’t talk about deals and when we’re first exposing somebody to how they can earn high rates of return, we talk about private money. So how do we separate those conversations? Well, when someone has told me that they’ve got, let’s say they’ve got $150,000 they want to invest and get high rates of return conservatively, I’ll say, great, I’ll put your money to work for you just as soon as possible.

(08:11):

I don’t talk about a deal upfront. If they’ve got retirement funds that they want to get higher rates of return on, I’ll introduce ’em to the self-directed IRA company that I recommend. They’ll get their funds moved over. And so here’s what happens and here’s the magic sauce, David, I give ’em and I call ’em up with what I call the great news phone call. What in the world is the great news phone call? Well, the great news phone call is not a pitch. I’ve never pitched a deal in my life ever since I started raising private money in 2009. I pick up my handset with my cord attached to it here in North Carolina and I call some of your, don’t even know what that is. And let’s say, David, let’s say you’re one of my private lenders. So I’ll put my phone right up here and you’ll answer the phone and we’ll have a little chitchat and I’ll say, Dave, I got great news for you.

(09:06):

I can now put your money to work. I got a house in Newport with an after repaired value of $200,000. The funding requires 150. Closing is next Tuesday. You’ll need to have your funds wired to my real estate attorney next Monday. I’m going to have my real estate attorney email you the wiring instructions end of conversation. Notice I didn’t ask If you want to fund the deal, of course you want to fund the deal. You’ve been waiting for the phone call. I’ve told you the program. I’ve taught you the program, you know what kind of rate you get, what the maximum loan to value is, the program that I’ve taught you. And so now you’re waiting for the good news phone call, which I just gave you. And in addition to that, if you as my private lender, if you’ve moved your retirement funds over to a self-directed IRA company, you ain’t earning any money until I put your money to work.

(10:04):

You moved it at my recommendation. Now I’m ethically bound to put your money to work. You ain’t earning any money until you actually put her to work. So again, we separate conversations, we leave with a servant’s heart, we educate, and by the way, David, these people going around saying don’t just get the deal under contract. The money is show up. I want to throw up where is the money going to show up? Is it just going to rain out of clouds or something? No, get the money lined up and you can get it lined up fast. Just like me. There’s always going to be deals.

Speaker 3 (10:38):

Yeah. Oh man, that’s really good stuff. I love how you went down that road and it helped you personally. Now you’re just teaching a lot of people. I love that magic question. Who do you know that can help me with my problem? It’s that who, it’s not always the how. It’s the who did I know, and in that point it really helped you. I also run into a lot of times, I don’t know if you see this, where there’s someone who’s like, I could save a couple interest points if I just use my own money versus a private lender’s funds. What are your thoughts on that of always taking down your own deals versus going out there and putting the work into getting a private lender?

Speaker 1 (11:17):

Sure, I get that question all the time. They say, Jay, you making all that money? Why don’t you use your own money to invest in real estate? Why are you still borrowing private money? Well, here’s the answer. If you’re just going to do one deal, that’s a great use of your money. That’s a fantastic use of your money. But do you want to scale your business? I mean, right now we’ve got seven different projects going on, single family houses simultaneously. Well, I don’t want my money buried in seven houses or projects simultaneously, which here in our local market can easily be over 3 million with the prices of our homes. So if you want to scale and really, I mean most people have got a bottom of the bucket in their checkbook. So if you want to scale your business, then private money is the way to go. Another answer to that question is, do I want to pay myself 8% or do I want to use my money for something else,

Speaker 3 (12:22):

Right? Yep.

Speaker 1 (12:24):

So that’s a couple of answers to why I use private lending and why I’m still using 47 private lenders,

Speaker 3 (12:33):

Which is great. I love what you said. If you want to scale, it can run out of cash real quick. If you just keep using your own money where a lot of people have to choose between, okay, paying some percentage points or sleeping at night, and it’s like, I think I like your option a whole lot better, especially if you’re looking to grow. But I like how you said that one deal. That’s okay, but if you are looking to be a real estate investor, this is something you’re going to have to go down that road. Now, last time I asked you some questions about the private lending process. I don’t think I asked this one though, is how do you maintain a relationship with that many private lenders? You’ve got 47 people in your network that you call up with the good news call. So is it like how do you maintain a relationship with all those people?

Speaker 1 (13:22):

I mail ’em checks.

Speaker 3 (13:25):

I love that. That’s a great answer. Oh man. No better way to keep a relationship there.

Speaker 1 (13:33):

I mean, they love getting money in the mail, right? Yeah. They love mailbox money, so I mail ’em checks.

Speaker 3 (13:41):

So you mail ’em checks. So you’ve built a good enough business where you can keep 47 lenders busy and their money active.

Speaker 1 (13:50):

Well, to be totally transparent, I mean, it is a juggling act to tell you the truth. I mean, there’s more money than there is deals.

Speaker 3 (14:00):

Yep.

Speaker 1 (14:01):

There’s more money than there is deals. And so we got 47 private lenders. Some of them have got $30,000 with us, some of ’em have got a million dollars with us. I can’t buy a house for 30,000, but I can use 30,000 for rehab money. You can use private money, borrow private money in a junior position, you’ve got to disclose that. But I can put private money in a junior lien. But what comes into play there is what we call total loan to value. So I’m not going to be borrowing more than 75% of the after repaired value. I didn’t say the purchase price 75% of the after repaired value. But let’s say back to that example that we just talked about, David, where if I’ve got a after repaired value on a home of 200,000 for easy figuring, I can borrow up to 150,000. That’s 75% of the after repaired value. But if I buy it for a hundred thousand, which I do all the time, 50% of the after repaired value, I can have a private lender in first position at a hundred grand. I could have another private lender in second position at 50 grand. So add a hundred to the 50, now one 50 divided by 200,000 after repaired value, I got a total loan to value of still 75%.

Speaker 3 (15:27):

Yeah, I love that. And it seems like private money gives you flexibility and

Speaker 1 (15:32):

Options. Does that make sense?

Speaker 3 (15:34):

Yeah, that makes sense. A hundred percent.

Speaker 1 (15:37):

Oh, absolutely. Flexibility is where it’s all at. I got 15 reasons. I love private money over traditional money. I won’t share all 15, but the biggest one is it puts you in the driver’s seat. The traditional way to borrow money is you go to the bank and get on your hands and knees and you’re begging and chasing, well, they are making the rules, right? The lender is making the rules. But in this world of private money, we make the rules, we set the interest rate, we set the length of the node and all that.

Speaker 3 (16:14):

I love that. Flexibility is the ultimate play in real estate. You want to have flexibility and you want to be able to have that. So I love what you teach. Who is the person that you’re trying to teach out there? Is it the person that’s done one deal a thousand deals? Who are you trying to help the most with your business?

Speaker 1 (16:33):

Yeah, that’s interesting. At my live events, which is called the private money conference, and my live events, we have about 60% or so have already done deals. They’ve already done deals. They want to scale their business. They are real estate investors wanting to scale their business, and about 40% are looking to get their very first deal. So I’m helping everybody. I mean Stu and Harriet Baldwin from New York State, they enrolled and joined my mastermind membership community and they already had a portfolio of a hundred houses. They’d already raised over $2 million in private money, but they wanted to see how I went about it. Well, just one webinar that I recorded with them brought in 1.2 million in additional private private money. So I’ve worked with real estate investors that are brand new and those that are also seasoned to help them get more private money ready to go for their business.

Speaker 3 (17:33):

I love that. It sounds like a lot of people out there need private money, and even if you’re just getting started, if you don’t have the funds to do that first deal, like you mentioned, you do that first deal, that one deal at a time, it might be okay, but this sounds like a great spot where if you’re getting into it or if you’ve got lots of stuff going on, this could be another way to make sure your company can keep running without what you ran into with the banks back in 2007, eight or oh nine. Would you say that’s true as well?

Speaker 1 (18:04):

Absolutely. Absolutely. I mean, I’ve met very, very few people. In fact, I can’t even think of one. I haven’t met any real estate investor that says, I got enough money.

Speaker 3 (18:20):

Yeah, me either.

Speaker 1 (18:22):

I can’t use any more private money. However, David, you are looking at one right now. I got about almost $2 million right now, what I call sitting on the shelf waiting to be deployed. And I tell you what, I’ve had new private lenders come into my world that want to invest and just to prove to them that I can perform. I’ll take the new private lender’s money and pay off a current private lender, refinance the deal so I can get their money to work for ’em, right?

Speaker 3 (18:53):

Ah, yep, that makes sense. I like that. As you grow and scale, you might run into that issue and you make one lender a little bit happy. I mean, at least they’re getting paid off, but then they probably come back to you and say, I want you to put my money to work again. Do you have that come up a lot?

Speaker 1 (19:12):

Quite frankly, when I pay ’em off, they’re not happy.

Speaker 3 (19:17):

That’s why I said just a little happy, maybe a little bit.

Speaker 1 (19:20):

But when I pay ’em off, they’re not making any money on that money. In fact, with a new private lender, I’ll get ready to pay ’em off cashing out on a deal and I’ll call ’em up and say, Hey, just want you to know that you’re going to have a check coming in the mail from a real estate attorney’s trust account. We’re paying off this house. And they’ll say, Jay, can’t you just keep the money? And I’ll go, no, I can’t keep the money unless I’ve got your money secured by a property because we do not borrow unsecured funds. Now, here’s maybe a little advanced strategy for some folks, but I do substitutions of collateral or loan modifications all the time. If it’s a small amount of money that a private lender’s invested 30, 40, $50,000, and we use it for rehabbing a property. So when I’ve got another property I’m getting ready to start on, I’ll substitute the collateral and keep that 30 or $50,000 note in play. So they keep earning money on that money, but we will substitute the collateral just to a different project that we’re moving to.

Speaker 3 (20:25):

That’s awesome. So then sounds like you have a good problem. It’s like, I want that. Well, I think a lot of real estate investors would rather the problem, I have too much money versus I’ve got these deals and I can’t fund them. So I really like how you teach people that and where it could snowball into this, where it’s like, I’ve got 47 private lenders, I’ve got to go out there and get the deals for ’em. Absolutely. And I really like that. And

Speaker 1 (20:50):

For goodness sakes, you don’t start out with 47 private lenders. I started out with one, right? I started out with one and then that quickly became two and three and four and five because private lenders tell other people what’s going on. So I haven’t actively attracted private money for years because our current private lenders just keep sending us people. In fact, day before yesterday, day before yesterday, I got a phone call from the mother of a good friend of mine, his name’s Craig, lives in Newburg, North Carolina. Craig had told his mother about this investment thing that I got going on and she had never heard of it, which is really funny. I’ve been doing it now private money since 2009. So she calls me up and she says, Hey, my son’s been telling me about this investment thing you got going on. Tell me about it. So word of mouth gets around very, very quickly when you start doing business with private lenders the way I do.

Speaker 3 (21:53):

Yeah, I like that a lot. So in order to get people to talk like that, what are the biggest things that you do for your current private lenders that makes them want to recommend you?

Speaker 1 (22:07):

Well pay ’em on time.

Speaker 3 (22:08):

There you go. That’s a big one. Sounds like that would be a really great place to start.

Speaker 1 (22:12):

Pay ’em on time. But I also have three times a year I put on a party for our private lenders at the Dunes Club. So we have three times a year a VIP reception over at the Dunes Club on the beach, and it’s just an evening of private lenders getting together and we have a good old time and I feed them and give them all the soft shell crabs they want, and I tell ’em to bring their friends with them.

Speaker 3 (22:42):

Yeah, that’s awesome. So number one though, that anyone can do at any stage is pay people on time. So actually pay, would you say, what about communication? I hear that come up sometimes too. How do you do a good job on the communication with your private lenders as well?

Speaker 1 (23:03):

Well, it must be good enough. They never go away,

Speaker 3 (23:06):

Right? Yeah, that’s the big things I hear.

Speaker 1 (23:10):

Here’s one thing I have not delegated as far as communication. I personally, I mean my relationships with my private lenders are very, very important. So I personally pick up the phone, pick up the phone, and call my private lenders when I have got a deal for them to fund. I do not delegate that out. I could

(23:37):

Delegate that out, but I don’t, when I got a deal for them to fund, I’m the person on the phone keeping that relationship When I’m getting ready to pay them off. I don’t have a check just show up in the mail. Of course they got to sign a payoff instruction letter if a different closing agent is closing it for a buyer. But before any of that happens, I personally call ’em up and I tell ’em that we’ve got that property sold. We’re getting ready to pay you off. Or I’ll call ’em up and I’ll say, Hey, we’re getting ready to pay this property off, but I will keep your note open so you can keep earning money. I’m just going to substitute the collateral. We got some documents we’re going to email to you for you to sign and send back the communication. I’m personally involved in putting their money to work and letting them know when we’re cashing out and where they are on the deal.

Speaker 3 (24:31):

That’s awesome. Then since it’s the profit first I podcast here, I love this concept of the private money because you need your cash in your accounts. So to be able to run your business, do those things, and then setting up a separate account just for your private money lenders, so it makes it easier to do what Jay just told you to pay them back, to pay them back on time to be in good communication with them. So now this has been really good. Do you have any other advice before I ask you? How could they work with you? How can they get in touch with, because I know this is something that is needed desperately, that I send people your way all the time. I know I trust you to help people, but any other last minute advice here that you would give to the real estate investors listening to the podcast?

Speaker 1 (25:18):

Sure. I appreciate you asking that question. It’s going to be very hard to own a lot of real estate

(25:26):

Until you own the real estate between your ears. So what do I mean by that? People ask me, how do I start? How do I start raising money? I can tell you how you start raising private money. You get your heart right, you get your mindset right. So what do I mean by that? Well, what do you do? You lead with a servant’s heart, you lead with education, you put your private lender money hat on, you private lender, teacher hat on, and you leave with education, don’t pitch deals, and you really, really are concerned about the other person and realize, part of this mindset is realize you’ve got an opportunity to change people’s lives, right?

Speaker 3 (26:11):

That’s so good.

Speaker 1 (26:13):

We’ve got countless people that are particularly in their retirement years, that have thanked me and Carol Joy for making a difference in their retirement years to where they can, I mean, they don’t want to touch their principal. They want to live off of their principal investment. So they’ve been able to travel, go see grandkids, do all this stuff that they couldn’t do otherwise until they got involved in our program. So just know that you’ve got a way to really make an impact on other people’s lives. And lemme tell you another part of mindset. It ain’t about reaping. It’s not about reaping. It’s all about sowing. It’s all about sowing. I can’t be reaping all that private money and deals until I have sown and given and led with value first. So how you sow is how you’re going to reap.

Speaker 3 (27:08):

Yeah. Oh man, this is so good. I’m glad I asked that question because I hear the passion in your voice and I hear that you really care about the people you work with, the people that have private money lenders out there, you care about that relationship. I love what you said. Get your heart right, get your head right. I also think, like you said too, that if they don’t have that desperation has a smell. So if you’re out there, you’re desperate and you’re just going out there, then you won’t have people like you have that want to keep coming back, that want to continuously invest in you. So that was, I think, the best advice that you could give right there. Get it between your ears and get your heart right. I absolutely love that. And just to recap too, I love your magic question.

(27:55):

Who do you know that can help me with my problem? Then one day you’re going to wake up and you’re going to be like Jay, and you’re going to be helping other people with their problem. I’ve got money. I want to put it somewhere, and you’re the able to get them to where they can be. Desperation has a smell. I love that. And then honestly, I love that pivot. You are like, it’s not about the reaping, it’s not about the interest that I’m making or the profit I’m making for the deal. It’s more about sowing those seeds and ultimately you’re changing lives. That’s why you get private money, and it’s like that interest that you’re paying them is twofold. It’s like you get to sleep at night, you’re not using all your money and you’re getting to help someone else get a return that they wouldn’t be able to get anywhere else or in someone that they trust as well too, and that’s a little bit more tangible than the stock markets or all this other Bitcoin, some of that stuff that’s floating around out there. So this has been awesome. So how do people then, Jay, take that next step with you? Do you have a book? You talked about an event. What can people do?

Speaker 1 (29:01):

Absolutely. Well for your audience, David, I’ve got two gifts. First of all, I finished writing my book Where to Get the Money. Now, this is not a ebook. This is a book book that we actually send in the mail Autographic where to get the money. Now the subtitle is How and Where to Get Money for Your Real Estate Deals Without Relying on Hard Money Lenders or Traditional Lenders. It’ll walk you through step by step how to get all the private money you would want. Very, very easy to read. It’s $20 on Amazon, but you can get it for free. Being David’s audience, just cover shipping. You can go to www dot j Connor, J-A-Y-C-O-N-N-E r.com/book. So I’m an er, not an or. So that’s j Connor, J-A-Y-C-O-N-N-E r.com/book, and we’ll three day priority mail it out to you. Now, in addition to that, I’ve got an upcoming $3,000 per ticket live event right around the corner. But for your audience, Dave, I’m going to let everybody come for free with a measly $97 registration fee. This private money event. You can check it out at www.theprivatemoneyconference.com. The private money conference.com. That’s coming up right around the corner in June. Get on over there. Registrations are open, and I’d love to meet you in person at the private money conference.com.

Speaker 3 (30:31):

Awesome. I’m excited about that too. I love what you’re doing and you’re solving a big need that we hear all the time. Just like all people always needing to sharpen their acts when it comes to private money, you graciously have also invited me there to speak about Profit First. So I’m excited to get to tell people about that so they can get more private money and be more confident and not be desperate when they go and ask for people. So I’m really excited about that as well. So make sure we’re going to put those links there, but make sure either get his book or go to that event. I cannot endorse Jay Moore because I know how many people he helps, but then he also has the heart. You heard it right here. That’s how he wants to help you too. It’s very much a heart and a mission and a passion for him.

(31:13):

So Jay, thank you for coming on, for sharing your wisdom, your knowledge today. If you are listening to this episode and you feel stuck like, what the heck is going on? Where is my money? I don’t know what to do. I’m a little bit nervous to go out there and get private money. I can’t keep my own house in order. That’s where you could go to simple cfo.com where we can help you walk you through that process. We’ll link you up to Jay too. If you need private money or need to learn about private money, this is who we recommend. I recommend Jay to many people, so make sure that if you need that help you go to simple cfo.com. But Jay, again, thank you for being on the show and sharing your wisdom here today.

Speaker 1 (31:51):

David, thank you so much for having me. God bless you.

Speaker 2 (31:54):

This episode of the Profit First for REI podcast is over, but there are plenty more where that came from. Are you ready to learn how David and his team can help implement the Profit First system in your business? Schedule a discovery call@simplecfo.com right now. We’ll see you next time on The Profit First for REI podcast with David Richter.