by | 13, Sep 2022

How To Invest In A Chaotic Market?!

In today’s episode, you all are getting a sneak peek into our exclusive quarterly newsletter! Now, these newsletters are only for our investors, so this is a pretty big deal!

In this newsletter, our very own Anthony Vicino wrote an article on how to invest in a chaotic market. We all know the stock market is a roller coaster right now, and crpyto plummeted, but there is a way to navigate these times and come back out on top! How?

Cash flow, reserves, and optionality. These three things give you the ability to sit on your hands and wait! And time is an investor’s best friend! So how do these 3 things play into a chaotic market?

Find out on this week’s episode of Multifamily Investing Made Simple.

LEAVE A REVIEW if you liked this episode!!

Tweetable Quotes:

“Condense decades into days through modeling the behaviors of the other people that are doing the thing that you wanna do.” -Anthony Vicino

“If you’ve got your cash flow thing figured out, you can sit there and wait out any storm that, that comes your way.” – Dan Krueger

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five rules of investing

The Five Rules of Investing

** Transcripts

how do you invest in a chaotic market

[00:00:00] Anthony: Hello there. Welcome to the podcast. Uh, this is multifamily investing made simple. I didn’t see you there. My name’s Anthony

[00:00:21] Dan: this year. This is Dan. try on a new intro. I like it. I like it. It’s like a 1990s, like, uh, um, A corporate video, like, hello, didn’t see you walk in.

[00:00:35] Anthony: Let’s talk about sexual harassment in the workplace.

don’t do it. Don’t do it. Um, so if you’re not watching the video go to YouTube to multifamily investing mid, simple to channel, I recommend just watching the first 30 seconds because I I’m reading a. And, uh, this can’t explain a bit. I can’t explain it, but I’m gonna, I’m gonna try. It’s called passive wealth and it is a quarterly [00:01:00] physical newsletter that we send out to our investors.

So if you’ve never invested with us, this is as close as you’re ever gonna get to passive wealth, uh, then the newsletter. But I thought today there was a, there was an article, there was an article in my favorite publication. Um, It comes from us. We publish this. So, uh, not surprising that this is my favorite, but there’s an article in here.

So I thought we’d break it down and we talk about it. Sure. In today’s podcast episode, what is the article? Well, I’m not gonna tell you yet. Okay. I’m gonna leave. I’m gonna leave you on

[00:01:31] Dan: bated breath. I have yet to read this because it came out fresh. Yeah. I showed up today and then I had to leave for meetings and I’ve I’ve yet to read this.

wonderful publication, one wonderful publication.

[00:01:43] Anthony: It looks beautiful. It is very well done. Well done to read. This is great. So we, this is only the second edition that we’ve ever done of this. Um, it’s really cool. It’s fun to do, like send it to investors and have a physical thing that they get to read and like have the stories in

[00:01:56] Dan: here.

The cover’s beautiful. I gotta say our last one was, um, oh yeah. I think it [00:02:00] was just like, More of a generic, uh, photo, but this is AC you know, this is, these are

[00:02:04] Anthony: our most recent acquisitions. I can’t talk about it yet, but, um, beautiful. There they are. They’re very beautiful. So if you’re one of our investors, thank you very much.

Hope you got your copy of passive wealth. Hope you enjoy it. If youve got some ideas for articles, let us know if you’re not an investor, then that’s cool too. I’m I’m gonna share, uh, we’re gonna dive into one of these, um, articles, which actually I think is gonna be really, really interesting. Um, but before we do that, let’s just put a pin in this and just put this to the side, um, into my that’s cool into my.

[00:02:31] Dan: nook. Make sure. I gotta say, if you guys aren’t watching on YouTube, the audio only of this, one’s probably gonna be kind of weird. So you should probably just go to YouTube and watch

[00:02:37] Anthony: this. Yeah, I’m a physical comedian. I use my body a lot for, you know, here. Let’s, uh, let’s do that bad investing advice thing that we do sometimes.

Okay. Okay. What do you think about, um, right now, now, like immediately? What if, what if I stopped talking and then you started talking with bad investing advice. Ooh, wait.

[00:02:58] Dan: I’m not sure I follow. [00:03:00] Well, let’s give it a shot. Welcome to the bad investing tip of the week. Um, alright, here we go. In order to be a good investor, you need to an investor in real estate.

You need to understand, uh, the underwriting, the math, all that stuff, markets. and the asset class, that’s a lot to understand. This is too much, just a lot. Right? What? I don’t

[00:03:24] Anthony: understand any of that. Okay. Am I wrong? I can’t even hold out all in my head. So asset class, I heard that, uh, underwriting mm-hmm the marketing, the market.

The market. Yeah. Um, what was the last one? I meant this was just three. I blacked that. Oh, that was it. Okay. Yeah. okay, well, I’m hopeless. Yeah. Do I have to know all this

[00:03:42] Dan: to invest in real estate? No, actually, I mean, it sounds like good advice because those are all important things to understand whether or not a good, uh, a deal is good or bad.

Mm-hmm , but I’m gonna say that the most important thing that you need to know is the right people. oh, the right people. Yeah. Cause you know the right people, you don’t have to [00:04:00] wait out into that ocean of information and, and just go on Google, YouTube, start reading books and, and blindly start trying to consume all this potential information because there’s so much out there that you could be consuming.

You could be learning, but I was, I was meeting with somebody the other day and uh, he recently, uh, had, uh, acquired his first investment property. He was a single family. And he was thinking about, um, venturing into larger multi-family space. Right? Cuz he was talking to me, I’m a little biased. And so I’m pumping that up and talking to how great it is.

And he is like, oh, I’m not really sure how to get started. And I was like, first thing you gotta do is just meet as many people in that space as possible. And then you’ll organically find the right resources. So instead of just blindly going out there and reading things, watching videos, doing whatever it is you do to, to learn something new, getting to a room with people who are doing.

And you’re gonna be amazed at how quickly you actually learn about that thing. Uh, things that would’ve taken you months to stumble upon just blindly researching new topic. Uh, you’ll you’ll find much quicker and unless people are gonna be able to point you to the [00:05:00] right books, uh, to the right resources to learn.

So you don’t have to waste your time just wandering aimlessly. So I would say before you start to try to dive into information, get around the people who are doing the thing.

[00:05:10] Anthony: I like this. I like this a lot because I was actually talking with somebody earlier today. Very similar topic, which is people don’t pay for information, they pay for the organization and the application of that information.

And that’s the reason why you pay for courses or coaches, or like people that you can be around that have this information is because all the stuff that you need to know about like investing in multifamily real estate in particular, you can get it on YouTube for free. Yeah. But knowing exactly which videos you should watch and in which.

that’s the that’s the organization mm-hmm . And then the application is knowing, like with wisdom and experience when to apply which pieces of information in what scenario, like when to do what. And so instead of just diving into the information, which can be like drinking from a, like a legit fire hose, go find somebody who is doing the [00:06:00] things that you wanna do.

Go be in those rooms and start learning what. Organization and what their application system looks like. And that that’s the, that’s the secret fast tracking success right there. Yeah. It’ll save

[00:06:10] Dan: you months, if not years, like just, you know, yeah. What is a,

[00:06:14] Anthony: what does Tony Robbin say condense decades in days through modeling the behaviors of the other people that are doing the thing that you wanna do and you model it by being hopefully in close proximity to him.

I like that. Yeah. If you’re on this journey, like, because honestly, like we’ve done 280 ish episodes of this podcast. If you’re brand new to this, it’s good. Like, you could learn almost everything that you need to know about investing successfully in multi-family assets. Just do this podcast. However, there’s 280 episodes.

You do not know which order to listen to them in. Yeah, because we did not full disclosure guys. We didn’t do this like chronologically or any kind of like, uh, point a to point Z. We we’ve jumped around a little bit, little bit. Yeah. So I like that. All right. Let’s. Let’s talk about this, this article I read in a recent periodical who wrote this one?[00:07:00]

Um, this one is read written by Anthony vio. Yes. Yes. Um, so the topic today is investing in a world of chaos. And the three things that you need to know to succeed. Are you just gonna

[00:07:18] Dan: read this for the episode? Is that I’m yes. So this is book people.

[00:07:23] Anthony: All right. Dear listener, go ahead and get in bed and get called up.

Um, somebody, somebody had a request the other day for an ASMR episode, so no one had that request, please. I, I heard, do less. And so. Here we go. Nope. Sorry, go ahead and turn up my mic. I will leave this episode. Don’t do that. please. Don’t uh, that’s gonna make everybody real uncomfortable now. I’m not gonna read the article to you.

Um, I’m not even sure that you know, Dan what’s in here. No, I didn’t read that one. Okay. But I’m gonna, uh, we have three takeaways here. We have three things that you should know for operating and investing in a world of chaos. I think this will be very, very helpful as a passive investor, but also if you’re an active, um, on the active side too, keep these three concepts.[00:08:00]

So pin to the top of your mind, and you’re gonna do. So we’ll go through each one of these one by one by one. And I want to just get your, get your takeaways. Cause I know you haven’t read this yet. You haven’t had time to unpack it. You haven’t read like written an angry letter to the editor yet. So

[00:08:14] Dan: I think I’m looking at ’em right now.


[00:08:16] Anthony: read. You’re gonna be in trouble if this sucks. Strongly worded. All right, here we go. Number one, takeaway or number one thing that you need to know to invest in a world of chaos cash flow is king. Okay. Uh, should I just go through ’em all. Uh, yeah, I thought you were good. Okay. Okay. So number one, cash flow is king.

Okay. Number two, reserves our queen number three. That’s cute. I know. Right. Um, number three, optionality is also really good.

[00:08:48] Dan: is that, is that actually that’s actually

[00:08:49] Anthony: what it says. we have fun. We have fun with our PR with our newsletter. Okay. So those are the three takeaways. Cash flows, king reserves, a queen optionality is [00:09:00] also really good. okay. So let’s unpack those and yeah, I wrote this article from my perspective. You haven’t seen it.

So what do you think?

[00:09:08] Dan: Yeah, I mean, I think the first thing that comes to mind is, um, um, cash flow is, I mean, that’s, that’s your cushion, right? So, um, I know a lot of people, probably not so much lately, but, um, go back pre COVID. Um, I think a lot of people. Get into deals that, that were pretty light on cash flow.

Uh, but they had a plan to get it, to be, you know, cash flow positive and maybe even really healthy cash flow, um, at some point, right. Mm-hmm but, um, you know, after going through 2020, um, like we closed on a, we closed on a deal in January of 2020. Yeah. And so if we good timing had that plan. Of like, oh yeah, it doesn’t cash flow now.

But after we do X, Y, and Z in like three, four months, it’s gonna be, you know, it’s been out like four or 5%. And then at the end of the year, it’s gonna be 8%. Like if we had some kind of plan like that, which I’ve seen before, um,

[00:09:59] Anthony: we would’ve

[00:09:59] Dan: [00:10:00] bled a lot of money. Yeah. I mean, that would’ve been like, oh yeah, maybe we’re, you know, not cash flow for the first two or three months that, that would’ve turned into the first 12 months.

Very easily. Cuz you never know. Yeah. Um, so in my mind, that’s, that’s what I think of is, you know, if, if you’ve got your cash flow thing figured out. You can sit there and wait out any storm that, that comes your way, which is, uh, powerful. Yeah. A hundred

[00:10:20] Anthony: percent cash flow is like to me, it’s the lifeblood of a healthy company.

Yeah. It’s the sign that this company has margin has profit to work with. And man life gets so much easier when you have excess profit to work with, and that’s really what cash flow is. And as soon as that starts getting thin, you start feeling the pinch real quick. And I’ve seen a lot of deals over the last couple of years that had very, very little cash flow with the expectation that there’s gonna be a lot of appreci.

And there’s, there’s a place for that, like within a portfolio, perhaps, but I think for me, that’s not how I invest. Mm-hmm , um, I like the cash flow. In fact, for me, it’s a requisite. I it’s gotta be there. Cause without that, I, I lose sleep at night. Cuz anything [00:11:00] happens like, so you lose a tenant or, you know, something takes longer than expected.

We get an eviction moratorium and suddenly the, the business plan gets delayed by a couple months. It’s like, that’s just money coming outta your pocket,

[00:11:10] Dan: especially, I mean, in real estate, there’s nothing ever goes to. No right there. There’s never been a deal where everything just happened. The way we thought it was going to, something always changes.

Um, you know, sometimes things are, are favorable, but generally speaking you, and this is why we always build in a nice, big fat cushion in all of our deals because, okay. Here’s what we think is gonna happen. Okay. Now add like, 20% of cushion for all that stuff we don’t expect. And then, you know, 2020 rolls around and okay, we’re glad we had that 20%, but maybe we wish we had would’ve had 30 or 40, but what I’ve noticed is anyone that is like really blown up over the years.

It it’s been because, uh, they had to, they, they, they couldn’t just sit there in cash flow. Mm-hmm they had to either have a capital bent event because their loan was maturing or they [00:12:00] had like this appreciation play. Um, you get forced into doing things if you don’t have cash flow coming in, but if you’re cash flowing and you’ve got flexible terms, which I think we’re gonna talk a lot, a little bit about in, in number three here mm-hmm um, you could sit there and wait for a really long time while the world grows crazy and you’ll do okay.

[00:12:18] Anthony: And, and this gets into number two, you know, if cash flow is king and reserves are queen in, in, in, in a chaotic investing market. And I, and I wrote this article because in the last like six months, we’ve seen a lot happen with the stock market being way up and way down, and then crypto being way down. And there’s just, all this tumult and interest rates are rising.

Inflation is crazy. And people are like, well, what do we doing these crazy times? And these are like the bedrock cash flow. If you have. You’re you’re, you’re in a good position from day one, but number two is reserves, right? Like cuz cuz sometimes cashflow does disappear for whatever reason and like big things happen on a property.

And if you don’t have those reserves, then you can be caught with your [00:13:00] pants down and no backup pants to be seen.

[00:13:02] Dan: Yeah. And this one’s, um, this one’s a tricky one, especially because I, um, have to kind of explain this to a lot of people coming in and looking at our deals a lot because most groups do not.

Um, capitalize like we do a lot of groups use a lot more debt. They come in with, uh, skinnier, CapEx budgets, um, and they try to reduce the amount of capital needed needed in a deal as much as possible. Because if you’ve got, let’s say, you know, 10 bucks coming out in cash flow, um, to try, try to keep it simpler.

[00:13:34] Anthony: That’s terrible. even for a lemonade standard.

[00:13:38] Dan: That’s terrible listeners who can wrap the heads around this. So if you’ve got a deal, that’s gonna produce 10 bucks in cash flow and, uh, you can get in there with a hundred bucks. And just barely make it to, to cover the needs of the deal. Right. Okay. That that’s a 10% rate of return, but let’s say you’re a little bit more conservative and you’d rather come in with your, uh, with your reserves and your, and your, your CapEx [00:14:00] budget to, to reduce, you know, how much debt you’d have to take on.

And just basically come in with more cash. If your denominator goes up to 15, you know, that that 10% return drops pretty quickly. Right. So we come in and look at, okay, well, how much capital does it take to execute this, this. and, um, and that’s, that’s what we’re gonna do. We don’t try to back into, uh, the returns because the bigger that denominator gets, the point I’m trying to make here is that the, the more capital you bring into the deal, uh, the rate of return will decrease because the denominator gets bigger.

The same amount of money is coming outta the deal and the form of cash flow and returns and all that stuff. But the bigger that denominator is, uh, the smaller, the cash on cash returns gonna be the smaller, the IRR is gonna be the smaller, the average annual return’s gonna be. And so when someone’s putting together a deal to present to investors, they want those numbers to be as high as possible.

And one way to get those numbers theoretically higher is to reduce how much cash is needed to actually get into the deal. So I think a lot of guys get tempted into just coming in with really, really skinny deals and [00:15:00] not much capital because the potential returns look bigger on paper, but the risk profiles also substantially.

[00:15:06] Anthony: First, I’ve never heard anybody say the word denominator so many times in the span of a minute. Um, so that’s one number two. Um, what ends up happening a lot? If you don’t raise all your CapEx and ample reserves in the very beginning? Well, one you’ve killed a queen. So now you’re a single king, just relying on cash flow.

And the thesis is we’ll bring less capital to the. And therefore all of our returns will be juiced up a little bit because we have less money in the deal. This is where people are like, oh, I bought this thing with zero, $0 down. It’s like, yeah, you have infinite returns. But it’s also means that if something goes wrong with the property and you need to spend money on CapEx or something has to come out of reserves, where does that come out of?

It comes out of the cash. Right. And so it’s like, if you don’t have reserves, you have no queen. Then when times get thin or you have a project that needs to be funded, that means you have to like, go blood, let the king like, get over here king. We [00:16:00] need, we need some of your life force. And when you’re doing that, you’re you’re you’re man.

I just realized the queen died a couple days ago. Yeah. This is way too soon. Yeah. This is too soon. Like this is hitting me pretty hard. I’m getting, I’m getting a little emotion. But like, you never wanna put both of your never wanna put the entire monarchy at risk. That’s that’s all I’m gonna, like, just be careful to put both the queen and the king on the, on the chopping block segue.

I’ve never really been all that into like the royalty thing. I didn’t really understood it, but like somebody on Instagram or Twitter the other day they’re British and they’re like, here, let me explain this to the Americans out. It’s kind of like Mickey mouse died I was like, so like a cultural icon.

Yeah. Like, I don’t know, like the mascot or I still don’t really get it. I don’t get it, but, okay. So anyways, reserves super, super important. You probably need more than you realize, and if it brings the returns down. So be it because it goes back to one of the, the core foundational principles is take care of the downside.

The [00:17:00] upside takes care of itself. That’s hard marks. I’m gonna give Howard marks

[00:17:04] Dan: to crack. I don’t know everybody says it. So

[00:17:06] Anthony: I’ve said it many times at this point. I think it’s mostly my quote, if it’s just, yeah, I think it’s just, um, you get to claim quotes based off how frequently you say them. So I also own that, um, that old, the old Marilyn Monroe quote.

Now it’s an Anthony Vino quote that if you can’t handle me at my. My worst. You don’t deserve me at my best. Mm. That was Maryland. Yeah. I like it. That’s a, that’s a, that’s a mem all right. Right. So we got our king. Yeah. We got our queen. Those are

[00:17:34] Dan: great. And some sort of peasant down here at the bottom. I don’t know opportunity.

[00:17:38] Anthony: Yeah. When I was doing this, I couldn’t think of another form of royalty where I was like, so, and so was prince and I was like, that’s not quite right. Like gesture. It’s not really the judge. It’s not really the gesture either though. But like optionality could have easily been number one, the duke, the duke, ah, the duke of optionality.

so what, what, what do we mean when we say optionality? Mm.

[00:17:59] Dan: [00:18:00] Um, I mean, you could apply this to, to a lot of things, but the first thing that pops into my mind is, uh, mm, because that’s one of the, the biggest constraints on deals, or it could be one of the biggest constraints on deals because there’s a lot of groups that get into, uh, a deal specifically into a value, add deal with some really short term debt initially for that, that renovation period.

Um, typically because they can get, uh, maybe a little bit more leverage, uh, maybe a lower death service on the front end, uh, um, to help with the, the renovation period. Um, maybe you can get some pretty attractive terms in the form of lower rates, you know, again, try

[00:18:37] Anthony: to like reduce the amount of capital needed at the beginning of the project.

Right? Exactly. Yeah.

[00:18:41] Dan: So we’d never really have done the, the bridge debt thing, to be honest. So I don’t, I don’t know exactly what the draw is, but a lot of groups do it. And the, the downside of that is you’re gonna have a term of, I don’t know, maybe a year, six months kind of depends on the, on the deal. And the debt, but, [00:19:00] um, I mean, that would force you into having to refi or sell, uh, within a very short window of time.

Mm-hmm and if it’s 2008 and your short term bridge loan is, is, uh, maturing and you’ve gotta do something. Well, good luck. Credit markets are drying up. Um, no one’s lending, like you’ll be, I mean, this is what, uh, I think this is what happened with, uh, Dave Ramsey. I believe he was doing 90 day notes, I think.

And that’s so that’s so. and, uh, yeah, you just, you don’t have the option, um, to, to, to pivot if things change that’s. Yep. So that’s one option and 1, 1, 1 example. Yeah. But what else were you think where you said, uh, optionality? Well, another

[00:19:36] Anthony: one I think about a lot is, uh, what’s my exit strategy. Like never go in until, you know, how you get out and debt is one of those pieces, cuz debt can often influence to a large degree when you need to get.

And if you have to. So like, if you have a short term, you might find yourself having to exit the deal much more early than you previously wanted to because you maybe were planning on a refinance and now that’s not lining up. [00:20:00] Uh, but another way, you know, we had this interaction with a seller, not too long back where, you know, how what’s your, what’s your means for air profitably, exiting a deal.

You know, can you continue holding this thing indefinitely and doing refinancing? And is it a cash flowing asset? That’s like strong and there’s not a ton of CapEx. And so it’s good bones. It’s, building’s gonna last a long time. Or are you forced into a situation where it’s like, okay, in three years we need to sell this and we need to sell it to a very particular type of buyer.

We need to buy it, sell it to somebody who is maybe doing a 10 31 and therefore maybe willing to take lower returns to be able to offset the taxes. You know, that can be a way to make really good returns for. and it is a plan, but if your entire exit strategy depends on you selling it to a 10 31, um, buyer, your, your pigeonholed.

And if you, if that person doesn’t come along, when you need them to come along, because debt’s maybe coming up or you have, you know, something else lined up that you have to take advantage of, you could find yourself up a Creek without the paddle and [00:21:00] without the boat.

[00:21:01] Dan: Yeah. And I’ve got another one actually.

Um, uh, that just kind of came to mind here because. Uh, pre 2020, uh, we did deals that I would call, uh, they were, they were heavier lifts. There was more work that needed to be done. Uh, we were buying properties that, uh, needed renovations. They needed new operations and in some cases they needed new tenants.

Um, so there were, there was a lot of upside on these deals. A lot of. Um, but there needed to be a lot of things changed, uh, immediately when taking these properties over and you could make a lot of money doing that. But, uh, in 2020, we, um, we realized that we actually had a lot of opportunities in front of us due to the relationships that we’ve created here locally, where we had a lot of upside in these potential deals that were coming down the pipeline.

But the one they were, they were very stabilized and very well run. And so we had some optionality. In these new, uh, types of [00:22:00] deals that we were doing that were coming from very sophisticated sellers, who knew what they were doing, where the value add opportunity wasn’t necessarily completely revamping things.

We had the opportunity, uh, to force a lot of appreciation through raising rents and making renovations, but they also came with very good tenant base that was cash flowing nicely. And so we ne didn’t necessarily need to rush into that. Um, so I think that could be another one where. You’ve got more than one potential business plan.

[00:22:27] Anthony: Yeah. Yeah. And honestly, like thinking back on that, like the difference between like doing a deal, that’s projecting like a 23% IRR versus like, and that’s gonna require a lot of work and a lot of like a lot of heavy lifting versus maybe you take a 5% hit, maybe you settle for only like a 17 or 18% IRR, but it’s like way more stable, which is still really good.

It’s like really, really good. Like, and that’s what we started to look at. It was like, why are we trying. Why why try to chase like the, the home run when just hitting doubles is a really easy. Yeah. And if we just keep doing [00:23:00] that over and over, like it’s way less work

[00:23:03] Dan: yeah. And it’s really not so much, at least for me about, about the ease of it.

It’s just the fact that, um, you could, you could go for a home run if you want. But you don’t have to, well, I guess that’s what I mean

[00:23:15] Anthony: by ease is like you have the option. Yeah. When, when you’re going for the home run, you only have, you have to swing hard. Yeah. It’s a home run or nothing. Yeah. but if you’re, if you’re going for a double, you’re like, oh, I can swing for a double.

I can swing for a single, I can swing for home. You can swing at whatever pace you want to. And it’s, it’s nice to not always have to show up and put in a hundred. Like a hundred percent effort into that one swing to cuz you know, if you don’t, the deal’s not gonna

[00:23:36] Dan: work. Yeah. It’s really powerful to just be able to sit on your hands and wait.


[00:23:40] Anthony: And that’s, and that’s what cash flow. That’s what reserves and that’s what optionality gives you. It gives you the ability to sit on your hands and wait. And time is always an investor’s best friend. The, the more time you have to work with on a deal, uh, longer time horizon over your over, which you’re allowing your principal to compound the better off you’re gonna be.

And so. [00:24:00] that’s to me, how you invest in a chaotic market environment right now, anything add like cash, just have cash. Yeah, just lots of cash stack cash. Any, any, any that you would add? Anything that got missed? Any really obvious oversights? Obviously this, I wouldn’t say oversights,

[00:24:19] Dan: but comprehensive. You know, if you wanna add anything else to that, I’d say, you know, doing nothing is also a very good option.

Yeah. Don’t need. To be doing all the time. Um, we’ve talked about a lot of the stuff. Uh, a lot of our episodes about, you know, unpacking buffet, quotes, and, and, and talking about what we learned from billionaires while we’re hanging out with that hot tub. If you guys missed that episode, go check it

[00:24:39] Anthony: out.

That was awesome. Yeah. I’m still, I’m still recovering. I’m trying to brag, but I got wicked sunburn. Jeff Bezos does a really bad job of applying sunscreen to one’s back. So if you ever, if you ever, if you ever need a bro to like, get that hard to reach spot on your back, don’t ask Bezo. He sucks at it. I’m I’m calling you out.

Still love you. He doesn’t

[00:24:57] Dan: need to be good. He’s he’s Amazon. So,

[00:24:59] Anthony: [00:25:00] um, I mean he spends all his time, just lathering that bald dome. I get it. Like there’s a lot of surf there to

[00:25:04] Dan: cover up there, but, uh, big brain. Yeah. I mean, just like doing less in general is something people need to consider. They don’t always need to be actively deploying capital, getting in things.

Um, a lot of really good investors will tell you that. There’s a lot to be said about just sitting and waiting for long periods of time until like the really clearly asymmetric risk reward scenario presents itself. So

[00:25:26] Anthony: I, I think there’s something to be said that like, as there should be like this inverse correlation between as more things are happening in the world, in the market, the less you should do a hundred percent.

And then as fewer things are happening in the world, in the market, the more you should. Because there’s fewer variables that you like, you, you probably just need to take more action because it’s just a stable, stasis equilibrium. So, well, do less maybe

[00:25:49] Dan: stay away. I mean, typically, um, you know, chaos leads to stability and stability leads to chaos.

So if it’s incredibly quiet and stable, that kind of implies, [00:26:00] it’s some sort of shit storms coming. That’s why you

[00:26:02] Anthony: gotta get ready. Put your, put your storm pants on. Do you have storm pants I’m wearing ’em right. The brown ones, you know, mine, anywho.

[00:26:11] Dan: God, , I’m just, they’re tan. They’re

[00:26:15] Anthony: tan pants. These,

[00:26:16] Dan: I feel like they’re kind of like a light green.

They’re kind of a camo eye can they’re they’re not at all camo. I come on. I’m colorblind, uh, for the, for the listeners who aren’t on YouTube I’m I’m not wearing camo. I’ve never worn camo. Oh, I didn’t say camo.

[00:26:30] Anthony: I meant camel.

[00:26:31] Dan: Oh, camel. Okay. Camel. All right. I was about to get rid. Yeah. You were like, you got defensive I’ve I’m not a camo guy.

Yeah, this is, this is there’s camo guys. I’m not, he’s not that guy. He’s not that guy. I’m kind of flannel today. Come to think of this. Yeah. What do you,

[00:26:43] Anthony: you can’t be too. Drudgy in your flannel. You look good. Anyway. Um, what book did we recently review? Uh, what was that? Do you remember?

[00:26:51] Dan: Uh, yeah. Hard thing about hard things.


[00:26:53] Anthony: Benjamin Hortz Horwitz Benjamin Horrowitz. I always say. Um, if [00:27:00] you guys haven’t listened to that episode, I would recommend you go do it because especially if you’re a business owner or founder, and you’re trying to build something with people, um, because Benjamin Horowitz in that book shared some experiences that are not commonly discussed in the world of like, uh, business books.

Mm-hmm he talks about the thing, like the reality of actually building a business and what are the truly hard parts. And it’s not like the big vision goal setting. It’s not that it’s. It’s not finding product market fits. It’s not that stuff. Um, and we dove into that book in last week’s episode. And as always, if you’re interested in compressing the timeline on which you’re consum.

Books. I would recommend you go listen to those podcasts. Cuz we take books that we love. That we’re really, really good. We distill it in a 30 to 40 minute podcast episode and then we create investor notes. So the sophisticated investor notes, which you can download@invictusmultifamily.com slash notes and last week’s book.

The hard thing about hard things. What was off the top of your head? If you [00:28:00] remember what was like your biggest takeaway,

[00:28:02] Dan: um, I guess one thing that, that really resonated with me, uh, that I just liked, uh, was a point that he made about how there, there is no roadmap. There is no, um, you know, there’s, there’s nothing you can go out and find, that’s gonna tell you how to be a good CEO.

And literally everybody who goes down that road is gonna be doing things that they are going to suck at, and it’s gonna feel. shitty and stressful and overwhelming, and that is completely normal. Um, so if you are going down that road and you are feeling that way, that’s the way it’s supposed to feel. I, I like

[00:28:40] Anthony: that part.

Yeah. My biggest takeaway is, and that’s a good one because there is no operations manual for this thing. There’s a lot of books, everyone books, everyone sucks

[00:28:48] Dan: at it. Yeah. Like if so, yeah, just

[00:28:50] Anthony: a lot of frameworks, people will give you to help you like conceptualize it, but then how you apply it in your unique, specific situation.

It’s muddy. It’s messy and only you can figure out how to do it. The, [00:29:00] um, the, the, the phrase that is in my, my head is if you have to eat shit, don’t ni. . Yeah, I know it’s a, I know it’s a horrible, horrible mental image, but I think it’s really true that when there’s things that suck and things gotta get done and they it’s horrible, horrible things will happen and you’ve gotta deal with it.

Get over. Um, just do it, just get the work done, get in there, get it over with, get your spoon out and just get it, get it down. um, and then get your mouth washed and then just move on as quickly as possible. So

[00:29:29] Dan: yeah, I also add so much detail to your description of that. You really paint? Just a very clear picture.

[00:29:37] Anthony: Yeah. I mean, that’s what people tune in for, right? Like the, the really uncomfortable details of the awkwardness. Oh yeah. You guys tune in for the awkwardness. I assume that’s why I’m here. That’s I mean, I had no choice. Um, I was lured in here with granola bars. They’re good promises of YouTube fame. So listeners, if you’re out there and you got any value [00:30:00] outta this episode, I mean, help, help us become YouTube famous, go over to YouTube and just subscribe to the channel, hit a like button, leave a comment.

Um, also like we’re trying, we’re trying to become the number one multi-family investing podcast in the world. I wanna be able to say that. I think that’d be really cool. For no other reason, just be able to say it. So what would help us do that is if you go and just leave a review in a rating on Spotify or apple or Google, wherever you’re listening to this, just go drop a review real quick.

It just helps to podcast grow and get to more people. And that’s, that’d be real rad. So that’s all we got. That’s it. We’re gonna wrap it up now. And, um, at any minute, at some point. Reid’s just gonna stop the recording. Cut me off. Mid-sentence and I’ll just disappear and I won’t know it, but you’ll know I’m gone.


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