Next time you pull up to a meeting in your $100k car, I hope you know the first thought of your potential partner is not:

"Wow this person does well, I need to work with them"

Instead, its:

"This is where the fees are going?"
Triggered a lot of folks with $100k cars with this one.

I’m just being honest about the thought that crossed my mind when a contractor showed up to give a bid at my home in his $120k F-350 Superduty Platinum.
I don’t have anything against folks who drive nice cars.

I personally think they’re a waste of money. A lot of people feel like me and think like the original post.

There is nuance, of course and this doesn’t apply to everyone.

If you can’t handle a post like this:
I’m here to share with you what works for me.

My reputation in business is built around frugality and capital efficiency.

I show partners that I could care less about status - im a good steward of our precious capital.

I’ll drive a nice car someday, but they won’t see it.

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More from @sweatystartup

10 Feb
A few entrepreneurial superpowers that aren’t talked about enough.

A thread.
Many high performers are assholes.

Being able to work with and manage difficult people puts you at a huge advantage.
Fear, pride, anger, excitement cloud your ability to make sound, logical decisions.

Making non-emotional decisions with impartial information is a superpower.
Read 9 tweets
8 Feb
A few reasons why I love self storage:

-Fragmented market with old-school competition

-Revenue spread among many tenants ($90/mo avg customer portfolio wide)

-Less than 5% increase in delinquency during pandemic

-No utilities, paint, carpet, appliances
What I don’t like about self storage:

Everybody else loves it too.
Self storage is not a land-banking play.

(Using it to sit on land for use doing something else later)

Even in major markets the rent outpaces class B multifamily with each less opex and capex.
Read 4 tweets
7 Feb
The life of an entrepreneur can be brutally difficult.

But nobody talks about it.

Time for a stiff drink and a few words on some of the most stressful periods in my life.

A thread.
The thing about being an entrepreneur is that there is nobody you can ask for help.

There is no boss you can call and dish off the really hard problems.
And there is no track-record or “way of doing things” that is proven.

So you have this constant nagging feeling that what I’m doing might not work and I might lose a lot of money.
Read 34 tweets
6 Feb
Every business has either a customer problem or an employee problem.

1. Not enough customers

2. Not enough employees (or inadequate systems) to execute

75% of service businesses fall into that second group, so if you can recruit and build systems, you can dominate.
And thats why I think businesses on this list are such great opportunities.

The owners aren't real "business" people. So you can stack up well and make great money:

sweatystartup.com/businesses-i-l…
Way too many owners expect employees who care about their business like they do to walk in the door.

News flash:

Those employees don't exist. They are unicorns. Nobody cares about your business like you do.

Instead:

Build a business that can thrive with avg employees
Read 5 tweets
4 Feb
Corporate america is a trap for anyone who wants to stop working prior to 60 yrs old.

They pay you just enough so the opportunity cost of doing something on your own isn’t worth it.

And more and more every year so the new $ is just enough to keep you.
They love it when you buy nicer houses, cars, things.

They hate it when you buy investment properties or assets.

Their goal is to keep you making money for them as long as possible.
By the time you’re 35 with two kids making $200k a year but spending $175k a year there is no way out.

They have you exactly where they want you.

And you’re 100% stuck.
Read 34 tweets
4 Feb
Banks love loaning a lot of money to people who buy real estate and every investor I know loves DEBT.

It amplifies everything. Kicking appreciation, depreciation and cashflow (or lack thereof) into overdrive.

A thread on how I think about it and how it works 👇👇👇
Let’s say you’re buying a $1MM asset at a 7 cap. Meaning it generates $70k in net operating income (before debt service)

You put $300k down and borrow the rest ($700k) from a local bank.
At a 4% interest rate on a 20 yr amortization schedule you’re paying about $25k in interest and $25k in principle a year.

That’s 20k in cashflow on your $300k cash investment. A 6.6% CoC return.

You need better debt terms to buy 7 cap deals nowadays. But let’s continue.
Read 27 tweets

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