Fat FI by 23: Building a 7-Figure Income & 8-Figure Portfolio in 3 Years

Scott:
From a sneaker side hustle at high school and learning the value of having your money work for you to a seven figure income and eight figure small multifamily portfolio in three years by age 23. Good grief. Hello and welcome to the BiggerPockets Money podcast. My name is Scott Trench and with me today is Kyle Mast.

Kyle:
Yes, good grief, this is BiggerPockets. The goal here is building a million millionaires and not just so we have a bunch of wealthy people running around, but so that we can have really great lives and live on purpose. If you want to get your financial house in order, this is where we need to be because we truly do believe that financial independence is attainable for everyone no matter where or when you’re starting.

Scott:
Today’s guest is an example of how massive action taken consistently and starting very early in life can lead to ridiculous outputs in one’s early twenties. This guy does things like scheduling his day from 5:00 AM until eight 30, including on weekends, putting a hundred hour work weeks in writing down every single activity set that he does throughout the day and analyzing them for the ones that make money or that can be delegated and are waste of time, and then leveraging those insights to build massive and scalable systems. We’re going to hear about some of Josh’s big lessons that he’s learned on his journey to financial independence at 23 with easily a five plus million dollars net worth and the incredible costs that he’s incurred and what he’s given up to achieve that outcome.

Kyle:
Yeah, we’re going to get into seasons of life with Josh talking about different times of really driving after something and when it’s time to maybe pull back and transition to different things, this is going to be great.

Scott:
Josh was featured on the BiggerPockets Real Estate podcast episode 7 49 in April of 2023 after his first year of investing, having accumulated 10 properties worth $1.5 million in asset value. Check out that episode if you want to hear the full backstory today. We’re excited to hear about what’s happened Since that recording. Josh, can you give us a snapshot of where you are at now and how things have progressed since that recording in April, 2023? For

Josh:
Sure. Yeah, so as a real estate agent, which is my primary role, I scaled from selling around a hundred houses a year to around 200, so primarily to out-of-state investors looking in Cleveland and Columbus, Ohio, and I continue to buy and bur small multifamilies and single families, and I scaled up to right around 140, 150 units right now. And then I have a development company where I’ll buy properties, renovate them, sell them as turnkey rentals to investors looking for less headache cashflow. So I do a couple of those a month as well.

Scott:
And Josh, remind me of your age.

Josh:
Yeah, I’m 23.

Scott:
23, so 23 years. And then let’s put some context behind that, 150, 160 units you mentioned there and this volume you’re doing as an agent, what is the income you derive from this agent business and what is the value and equity, the asset value and equity value of this rental portfolio you’ve built?

Josh:
For sure. So my realtor income last year was right around a million, and then I flipped a couple properties and then made around two 50, so that’s where I was at last year and I’m trying to triplet this year if I can. I made a lot of mistakes with contractors and lost a lot of money on homes or didn’t make money on homes that I could have made money on by going through a bunch of stuff, so that should be much stronger this year.

Scott:
You paid taxes in 2023 on an income of 1.25 million, give or take?

Josh:
Yes, and I learned the importance of cost segregation depreciation because the year before my tax bill was actually four times higher on half the amount of income than it was last year.

Scott:
Okay, so you had, because you are a real estate professional, an agent selling houses, you’re able to take this 1.25 million, give or take income from your agent activities and selling properties to investors, and you’re flipping income, which is active income and offset it with losses from this passive investing portfolio. Now, can you walk us through, give us the high level structure of this 140 units? How many properties are these units housed in? What are they worth and what’s the debt or what’s the debt and equity ratio?

Josh:
For sure, so it’s around 50 to 60 properties. The market values right around 15 million and I’m sitting around $4 million personal equity as a result of that. Most of it is owned individually, some of it is owned in a partnership 50 50 with two different people, two different partnerships, but yeah, that’s the personal side.

Scott:
And tell us about the operations of this portfolio. What is the rent versus costs that are coming in? Is this portfolio cash flowing today?

Josh:
Yeah, so a good chunk of them are still being renovated or in the process of being rented out. They basically were all acquired through the bur method, but everything nets around $150 a door monthly cash flow roughly.

Scott:
Okay. And is that $150 a month monthly cash flow after everything is rented out and your projection or is that what it’s currently bringing in today? Averaged out across the

Josh:
Portfolio. That’s when everything’s rented, stabilized, assuming property management, vacancy, CapEx maintenance, all that stuff.

Scott:
Okay, so for context, we have a cashflow negative current state portfolio that is in process of being stabilized. Is that right?

Josh:
Yeah, yeah. It’s cashing a little bit, but not a ton just because I’m still at a large proportion of renovating to stabilize units.

Scott:
Okay, and then I’ll stop peppering you with questions here shortly. I just need two or three more minutes. All of this has happened since April, 2023. We’re sitting here, it’s June, 2024, that is 14 months, and you had 10 properties. I imagine there were a few more units than that, but you now have at least five x six x that portfolio. All of this is going to be purchased at today’s interest rates, not 2021 interest rates, is that correct?

Josh:
Correct, yeah. My average fixed rates probably eight and a half, 8.25.

Scott:
Okay. And these are going to be financed with commercial or balance sheet debt, I presume not with Fannie Mae, 30 year fixed rate mortgages because you can’t have that many loans on a portfolio like this, is that correct?

Josh:
Yeah, that’s right, and I wasn’t even lendable last year either.

Scott:
Thank you for letting me just pepper you with questions about the portfolio here. This is a really extraordinary outcome. I think it’s our duty to unpack those and provide some context here. Kyle, why don’t you react to that?

Kyle:
Yeah, no, I think that’s really good. I think it paints a really good picture of where we’re at. This is a ramp up of an extraordinary portfolio for a 23-year-old. So to just help me understand a little bit the renovations that you’re doing the capital for that you’re in the process of doing that. Are you kind of funding that with your growing real estate agent business, kind of pouring the money that you’re making? I mean that’s a crazy income on the real estate agent business.

Josh:
Yeah, it’s a lot of renovations, so all hard money, I basically bought everything with hard money. The first lender said I couldn’t get any more loans, so I went to the next one and the same thing happened there. So now I’m private money mostly.

Kyle:
Okay, so when you buy a fixer upper essentially to bur it, you’re buying it with hard money and then renovating it, trying to refinance back out of that. And then this what you’re bringing in from your other. You’ve got your active real estate brokering business and then you’ve got or agent and you’ve got your passive slash active B strategy business. So the million you’re bringing in a year in your agent business, are you using some of those funds to fund some of the deals also? Oh

Josh:
Yeah, yeah, yeah.

Kyle:
Okay.

Scott:
Yep. And do anything else with the money? Is your entire net worth what we just discussed here in the real estate or do you also have other assets like stocks?

Josh:
I just put a big chunk of money in a overfunded whole life insurance policy, which we can talk about if you want 401k, other retirement, but probably 60 70% is real estate right now.

Scott:
Okay, wow. So you’re well on track to have 10 million in net worth within a couple of years here, even if you cease your ordinary income activities that you’re generating.

Josh:
Yeah, the goal is a year from today. Yep.

Scott:
Okay, and then one more question here. Let’s walk through the unit economics on a bread and butter deal. You’ve done 50 deals in the last 14 months. What is an average one look like? Not a home run, but one of the ones that’s just fairway for you that’s contributing to this huge portfolio?

Josh:
Classic deals. A duplex I’ll buy for 90, I’ll put around 30 to 40,000 into it. It’ll take two to three months and then I’ll refinance it at around 170, $180,000 valuation generally at a 75% a RV loan. So it’ll pay back the old loan. Maybe I pull a little cash out, maybe I leave a little cash in. But that idea is just churn and burn.

Scott:
And this is all happening in Cleveland, Ohio or nearby, is that right?

Josh:
Cleveland, Ohio, Columbus, Ohio, yeah.

Scott:
Wow. So this is pretty extraordinary here. I have to ask, what is the end state here? You set a goal of 10 million net worth by the end of the year, but I want to observe that you are in extraordinary income here. Cleveland’s one of the few markets where I think you can actually get, you can just be, it’s not quite average. You don’t have to find home run deals to make this strategy work. You can do this with deals on a continuous basis here. I’m also observing a super highly leveraged portfolio with, I think it was like 70% debt to equity at this point across the average portfolio. So how do you think about where this is going to end up? Because I could see this marching well past 10 million to 50 or a hundred million dollars in wealth in a reasonable period of time, like 10, 15, 20 years, or I could see you letting it deleverage and being done with 15 million in five or five years on this. So how do you think about it?

Josh:
Yeah, one of the first people that I cold called in Columbus, Ohio and I started doing this, owns like 1200 units and he was like 39 years old and it blew my mind. So my goal is honestly to try to get to a thousand as quickly as possible and slowly convert the C class that I own into nicer stuff, nicer, bigger buildings and packages of five to 10 leveraging the 10 31 exchange.

Kyle:
And then what’s the goal after that? So you just keep building into more B class, A class like leveraging up or what’s like Josh in 10 years, what’s life look like for you? What’s the end goal?

Josh:
Yeah, I mean I grew up 20 minutes outside of East Cleveland and it needs a lot of help economically, structurally in many ways. That’s something I really want to attack and I’m trying to build up a bigger name, build up wealth and figure out a way to help that area. A desperate need. And I know some people doing some things there and I’d love to build a fund, what they’re doing on a significant level.

Scott:
Awesome. So the mission is build up wealth so you can revitalize huge chunk of Cleveland.

Josh:
Yeah, that’s kind of where it’s coming from.

Scott:
Oh, actually one more question here. Do you intend to raise capital at any point in time or do you not need it as a result of what you’re doing because you generated enough income and have enough private lending sources to allow this thing to roll for some time to come?

Josh:
If I get into the commercial space heavily where prices are much higher, then I would do that. I would like to syndicate eventually, but I’m just trying to make what I’m currently doing as efficient as I can.

Kyle:
Alright, we have a good understanding of where you’re at, but I’m pretty curious to find out where the money story actually begins and we’ll get into that right after this break.

Scott:
Alright, welcome back. We are here with Josh. Janice. Okay, so you’re able to roll all this without having to raise capital from that, which by the way, I think is great. I think that 23 year olds raising huge amounts of equity capital and syndicated structures has not proven to be a winning formula for many investors and that this is much more, it’s highly risky. You are highly leveraged at this point, but you’re only risking your own money for the most part in this and I think you got a great crack at it and having this workout did an extraordinary degree over the next couple of years based on what I’ve heard so far. So with that premise set, let’s go and understand how we got here. So where does your journey with money begin and how has it compounded this extraordinary outcome at the age of 23?

Josh:
So I was a basketball player as a kid and I loved sneakers and I couldn’t afford any of the ones that I wanted, so I started to look into reselling shoes. That’s really where it started. I would go to events, try to flip them, I’d go to stores early in the morning, wait in lines, and that’s kind of where the journey started and I learned the importance of time management. I could pay somebody 50 bucks or whatever to wait in line instead of me doing it, and then eventually I could have five, 10 people doing it for me at different stores in different cities and it kind of goes from there.

Scott:
Walk us through what you were able to accumulate during your high school years and how you parlayed that into what happens next.

Josh:
So when I was at these sneaker shows, kids would make 300, $500 selling one or two pairs of shoes and they would then go buy their own pair for two 300 bucks and wipe out most of their profit. And it was hard for me to see that as scalable. Yeah, it was cool. They were the cool kid walking around now with the shoes that we all wanted, but I knew that if I could save all of the cash that I was making, eventually I could buy all the shoes and it wouldn’t even be an issue. So that’s another thing that I really learned is save your money early. Very powerful in the beginning once you figure out a machine to put it into.

Scott:
Awesome. So how much did you save and what did you parlay this into?

Josh:
Yeah, so I probably saved around $20,000 selling shoes in high school and early college and now I had this money sitting around. I didn’t really know what to do with it. I wasn’t really wanting to go to college, but I went to the school. Both my parents went to, I was door dashing listening to audio books, trying to learn about real estate and finance. I had a general interest in it. Then it came across the concept of house hacking and while door dashing, I learned even more the importance of time management. I could drive 10 miles for $5 or I could drive two miles for $5 and over time the person driving less is going to win per hour every time. So I was able to learn that. I read probably a hundred books on my Audible account multiple times at 1.5 times the speed doing stuff, but if I read it twice, eventually it’ll get into my head.
So I had money saved up, I put that together. Then I wanted to house hack at Ohio State and Columbus and that’s where I came across BiggerPockets for the first time and found an agent that was on there working with investors. I hopped on a quick zoom call and I ended up going into his office to check things out. When I went down there, I switched colleges and I was like, man, there’s like 15 kids in here that own real estate under the age of 30 and they’re just on the phones banging the phones. It was basically the boiler room. It’s like one room with desks all around, everyone grinding and instead of house hacking, I was like, let me try to do this. This looks way more fun than what I was studying in terms of computer science. And they gave me a list and I started calling four to eight hours a day depending on the day, sort of taking classes door, dashing at night to pay my bills and I just took the money that I had.
I was like, all right, I’m just going to call for three months. I don’t really care if I make a dollar. I’m just here to try to learn and see if I can meet any cool people. What they said, if you call, you can eventually meet some people that own. And if you’re a young kid that is genuinely interested in how an investor built their portfolio, these are generally old dudes that are rich, they own a bunch of real estate, they made it better than their friends. Their family doesn’t really care that much about it. Their friends don’t care, they didn’t do it. But if you’re a young person, you don’t have to be, but if you’re genuinely interested like, Hey, how did you get this property? I see you own this too, you they’re going to pour their energy into you. I met a bunch of people that way and it’s just a numbers game too.
You’re going to get screamed at, yelled at, sworn at all that stuff, but it’s all about trying to find those couple owners that can teach you something and eventually bring your properties to sell what it eventually turns into. So I learned patience through that, just consistently calling, taking notes, trying to learn from every single call. I mean, not really so many calls that you do, but conceptually, what can I do differently? How can I approach this differently? And that’s sort of when I got into putting a couple deals together through calling, then I made some marketing fees.

Scott:
Walk us through what putting together a deal meant. Is this a wholesale deal?

Josh:
Yeah, so I found a four unit, the first one for 400 K in an eight class area. I couldn’t afford it at the time to house hack because I was actually calling to buy a house hack sort of too, but I was working under an agent, so I brought him the information. I was like, Hey, this owner wants to sell it. Here’s his rents, here’s the age of the roof furnace, high water tank, here’s the price. And he’s like, oh yeah, I probably got a buyer for that. So then he put together an email saying the price, all he did was add 6% commission on top of what the seller wanted. So it’s not really wholesaling, it’s like hybrid wholesaling, which is the concept people said before. And that agent brought a buyer to the seller, they presented the offer, the deal closed. I made a marketing fee and it was a check for $2,500 or something and I was like, all I did was call a person and give information over and I got paid what I made almost every month driving for hours.

Scott:
How many calls did you make to get to that first 2,500?

Josh:
Yeah, I was really bad when I started. So it was probably three months of at least 20, 30, 40 plus hours a week before I actually put something together and then that deal took another two months to close. Walk

Scott:
Me through how, just curious here you have two, there’s two concepts that I see are in conflict with what you just said in your mind, right? One is I made one call and I got 2,500 bucks, and the other is I spent three months making 30 to four hours, 40 hours a week of calls before I got this one deal. How do you marry those two concepts in your head of was that going through your mind at that point in time and how did you think about that?

Josh:
Yeah, I mean my primary goal with calling was honestly just to learn and learn how to talk real estate and learn the space. So I mean, yeah, making money was cool, but I was making enough to live and save a little bit door dashing and I was like if I closed a deal, which I felt like it was kind of quick, I started nervous to call because I didn’t know what to say. I didn’t know what to do. When I got objections, I was starting from the floor and I got that deal closed, man, if I get good at this, I could probably do one of these a week and then eventually that’s what started happening.

Scott:
How did you balance all this cold calling activity with having a social life in college?

Josh:
So I’m 23. I’ve never drank. I don’t really party. That’s just not who I am. So I literally was working, calling door, dashing, seeing my girlfriend and my family and that’s it.

Kyle:
So this calling you went into it. I was going to pull out the same thing Scott did there. I could see myself going in for one or two months, this is terrible. I am just calling and getting rejected all the time and not making any headway. But I think maybe the listeners need to hear Josh was going into this, he was going into it to learn and he had this other side hustle going on. His life is simple at this point. He’s trying to just gain some experience and see if this is something he wants to do and learn how to do it. And then when he does get the hit, it’s more of a confidence booster rather than it took me three months to get here. It’s more like, okay, I’ve learned a lot in three months and then something happened and let’s see if we can make it happen faster and more after that.
So I think sometimes people, and the other piece too is making sure that you’re still working hard in other ways too, to pay the bills. I think sometimes people think they’re just going to go all in on something and then they give up, but you might’ve been able to go a little bit longer if you were door dashing on the side or you had some other income coming in on the side to kind of carry you a little bit further through that new venture. So I think that’s another thing Good that you had going for you,

Scott:
Kyle. I think it’s like the first 40 hours get you by and the next 40 hours get you ahead and that’s what I’m hearing here from Josh, right? Those 30 to 40 hours a week of cold calling were happening after you paid the bills with your DoorDash, got your homework done and made all your family and relationship commitments. Is that right Josh?

Josh:
Yeah, yeah. It wasn’t the top priority when it started and I was just trying to be basic about it. I’m going to call and then once I can make more money calling than door dashing, I’ll just stop door dashing. And then if I can figure out a way to make more money door dashing than what my college degree would make, then I would switch to just calling. The other thing I learned too, if I had a really good mentor and another thing I learned is the concept of following up, just how important that is. Maybe I only closed one deal in the first three months, but I got 50 people that know my name, I know their address, I know their price ish and they’re going to sell probably some of them in the next three months or six months or 12 months. And as long as I keep my foot in the door, I’ll be that person. And that’s what happens constantly. It’s likes just like a fall over effect and you can’t stop because then you ruin all of the buildup that you built in the past.

Scott:
Josh, during this time period, cash was going into your life during this period you were not shelling out cash in the form of investing into this cold calling or other business activities. Your bank account was growing and increasing your optionality, is that correct?

Josh:
Yeah, I was probably saving a little bit of money every month. I was just getting by with DoorDash versus saving like two 3000 when I was doing it.

Scott:
Got it. Okay. And did you put it all in cash or did you have investments going at this point? This is your freshman year of college for context, right?

Josh:
Yeah, yeah. Or sophomore junior year I just kind of had it sitting in cash. I was going to do something with it active, I didn’t know what to do yet. Yeah,

Scott:
I want to call that out too here because there’s a lot of talk about investing and like, oh, I’m not going to earn any money on that, especially in 2021 I think when this is happening, 2022. But if you are Josh and clearly going to do something entrepreneurial or keep trying along a list of different things there, I think you’re foolish to put it into a 401k to put it into any type of market investment to put it into real estate or anything else. You should be keeping it in cash and allowing yourself options and options At 21, you weren’t even 21, you’re 2019 or 20 at this point in time with that level of ambition and hustle and drive, I mean you’re just shooting yourself in the foot, taking your 10% market return. It is so much better to have a 24-year-old with 50 K in cold hard cash than 50 K in a 401k if they have your mindset and are reading all these books and taking all these actions at the same time. So I dunno, just an observation I have there. Sounds like that’s what you were doing. Alright, well, so we have our first deal. We made 2,500 bucks. There’s a long way to go between 2,500 bucks and the four to 7 million that I’m mentally computing for your current net worth. So how do we progress from there and continue the journey here?

Josh:
Yeah, so the start of the new year started 2022 is when I got my license and all of those people that I called started to fall over and started to sell. Now my first 11 deals from January to the end of March early April fell out because I was, as David Green said, which I didn’t conceptualize, but he did a good job. I took unqualified buyers and unqualified sellers and I put ’em in a room together and it never worked in the beginning and all these things happened and I was losing my mind, but I was like, I’m going to have to figure this out, 15 people around me that have and thousands of others around. So every deal that fell out, I was like, all right, what can I do differently? And I kind of do that to the extreme. You got to be conscious about it, but if you can always adjust what you’re doing, you can up controlling as much as you can.
So with sellers, if they don’t know enough about their property, if they say, oh, the rent could be this or the roof could be this, they’re probably not as invested in making a move as you are on your end trying to get the sale done. And then the buyer, if they’re not pre-approved or they don’t have a clear buy box, if they haven’t run their numbers on their end, all of those things can cause issues down the road. So it was literally just, alright, this happened, this deal, let’s make sure it doesn’t happen again over and over. And then the first deal closed in April of 22 and I think I closed six deals that month and then 10 the next month or close to it and it all just was rolling and I basically just didn’t stop. Josh,

Scott:
When did you get licensed As an agent?

Josh:
Yeah, the beginning of that year. January 22. Okay,

Scott:
So you didn’t really close, you didn’t make any money really until you got licensed as an agent. The wholesaling, cold calling didn’t really contribute to your income until you were licensed and doing it basically through the MLS and taking brokerage fees I guess.

Josh:
Yeah.

Scott:
Did you graduate college?

Josh:
No. So I was 70% of the way there probably.

Scott:
In your case, that would’ve been foolish I think to finish that play out, what did your parents think about all this? I think that’s a big thing here. You said earlier on that you weren’t sure about college, but your parents, you went to the school, your parents wanted to, it sounds like it was Ohio State. I hear they have a mediocre football team at least this last year. How did you get into and then out of college and what was that dynamic like with your parents who it seems like are always an influence on someone prior to college graduation years typically

Josh:
Of course, and I look up to my parents heavily in many ways it wasn’t easy. I think the main thing that really got me over it was like, Hey mom and dad, I made the last 90 days what I would make if I finished my degree and I’m just getting started. I had people had some doubts like, oh, you had one good month or two good months, let’s see. And my motivation was like, I’m going to have that every single month. I have to, I got to keep this up. And that’s kind of what allowed me to stop doing college and have it be relatively smooth. Alright,

Scott:
We want to hear what your first year looked like from an income perspective right after this quick ad break. For those listening while we’re out, please go search for BiggerPockets money in your podcast app and follow us so that you can get the latest stories and of course our eternal gratitude.

Kyle:
Alright, welcome back. We heard the tipping point. Let’s get into the outcome. So when did you transition, so now you’re starting to have some income as an agent and started to make some stuff. What are you making in that first year? What’s your income look like the first year as an agent?

Josh:
Yeah, so my first deal closed in April and I finished out the year right around 600,000. So I kind of got it rolling pretty quick and I bought a couple deals and made some mistakes with contractors.

Kyle:
Your first deal was in, you said April and you finished the year with $600,000 in commissions to you like net to you

Josh:
Correct net, yeah.

Kyle:
That’s not a bad first year. Yeah, that’s pretty good. Yeah,

Scott:
And you’re generating this income by getting listings.

Josh:
I’ll have a buyer that wants a turnkey duplex and I’m going to go find it off market and I’ll be the only agent involved and I’ll just connect them and I’ll try to make 6%. That’s the core of the business is try to be the only agent involved. Not every deal is like that, but that’s the ideal You get to control the most. I get to represent the buyer and be aggressive to the seller.

Scott:
And what’s the average price on these deals?

Josh:
I was selling more Columbus then, so probably like 200 ish now I’m more Cleveland, so probably like 1 40, 1 50.

Scott:
So how many transactions, how many did the math here to make? $600,000 in net commissions at 6% on $200,000?

Josh:
Yeah, I think my average commission was like 4%, something like that. But it was around 120 transactions, 17 million gross.

Scott:
Did you have any staff or was this you as an individual?

Josh:
This was me and then one virtual assistant and then a second virtual assistant towards the end of the year and I still run the same business with the same setup.

Scott:
That’s unbelievable.

Kyle:
Yeah, that’s unbelievable. I’m kind of like my mouth, I’m just trying to pick it up, be like what just even happen here. So where are you sourcing? You said you’re connecting buyers to sellers off market deals, so you have a buyer liga, so where are you sourcing your buyers from to find, I mean people always want to find the deals, but where are you finding these specific buyers that you want to source?

Josh:
So as I was calling, I was learning things and I just started posting on BiggerPockets, so I found a ton on BiggerPockets, LinkedIn, Facebook, you actually find a decent amount of buyers calling if you approach it the correct way. It was just a mixture of that and then almost all the deals I found were from cold calling or MLS or some pocket listings and just trying to connect the dots. I have a notepad, I write down everything I do every single day, especially in the beginning, every little thing I sent an email to a title agent about this, I texted this person this, it should be like a hundred plus things and at the end of the day you want to look at it and it’s like, what did I repeat? What can I delegate? What makes me money? What doesn’t make me money and write out procedures for everything because that’s what allowed me to scale quickly and maintain it with little staff is I think those processes.

Kyle:
Well I think something else you mentioned there, the neat thing, you mentioned your calls and sometimes in the productivity world if you can use the same action for multiple outcomes, so you kind of glossed over it, but you said something about if you call in the right way, you can find buyers too. You’re calling for sellers but you might find buyers as well. So you are now basically getting twice the benefit of your calls as opposed to connecting these buyers and sellers. So yeah, I think that’s a neat concept for people to think about when you’re starting to a side hustle sometimes there’s ways to make it easier that you’re not even looking at it. Scott, you had something to say. Well,

Scott:
I was just going to say I love that approach with writing everything down. I did that a lot more five years ago than I do today and definitely should get back into it. I just love the analysis on an ongoing basis. I wanted to ask if this is a, once you graduate, is this going to 40 hours, 60 hours, 80 hours? Is this an all consuming obsession essentially with building the business in the first year? Where on that scale are you in terms of effort you’re putting in to generate this $600,000 in income and I began building the real estate portfolio.

Josh:
Yeah, I mean as soon as I stopped taking classes a little before the end of junior year, this was the a hundred hours a week or stinking near close, I would start working at 5:00 AM and I’d leave the office at 8:00 PM very frequently and then I would go to the gym a couple of days a week and then Saturdays and Sunday mornings would be about building the business, taking the notes and implementing different procedures. And then Monday through Friday I would be working in the business. So one of my best friends is a Navy Seal and him and I worked out in high school and he’s crazy and I learned a lot of really cool things from him and I just kind of met what we did into this.

Scott:
So this has been a natural extension of what you’re doing in high school essentially in terms of the amount of output of effort that has going into advancing your goals. Nothing’s changed, it’s been more directive more efficiently to the accumulation of money, but is that a way to interpret what you just said?

Josh:
Oh yeah, for sure. Yeah. Caden and I would go swimming in a freezing lake at five 30 in the morning before school or do pull-ups. We would do Murphs, we would do all these things and then we work out after school again and I’d work on basketball or whatever. Now it’s just real estate.

Scott:
Alright, so this is a really interesting, I love what we’ve heard here and I think it’s not a stretch to understand, hey, that this system has now spit out a compounding rate of return in terms of total income and then allowed you numerous investment opportunities. Once you find a deal, you can either sell it or to many contacts in your buyer’s list or buy it and turn it into a wealth building machine through your real estate investing and rehabbing business here. So it’s not hard to understand how that kind of has snowballed at the highest level, although I’d love to cover that in great detail at some future point here. Walk me through when we talk, when BiggerPockets money, I would say that the vast majority of listeners here are folks working at W2 or have a small business that is nowhere near as explosive from an income perspective as yours and I, how do we translate your life lessons here into something that someone maybe without the drive to do a hundred hour work weeks and relentlessly optimize every single part of their life and those types of things. How do we translate that into something that someone who doesn’t want to rebuild Cleveland from an ambition standpoint can take away as a message in the wealth building journey?

Josh:
If you already have a cash flowing business or a W2 where money’s coming in and maybe you have the desire to leave, don’t leave and then invest, stay your living expenses down as cheap as you can. I still live very cheap compared to what I make. That’s never changed, never will. And use all of the money you have on the side to invest.

Scott:
Walk me through that point real quick. I see your background here, right? And this is not the home of a 1.2 million per year income generator that one would expect. I mean you would probably be able to pay off this home entirely or buy it in cash three times in a year would be my guess based on the background we’re looking at there. Remind me, and I know you said it, you want to rebuild Cleveland essentially here as your motivation, but remind me, is there an intent to harvest any of this income to drive your lifestyle at some point? Or is that so far off in your mind that it just wouldn’t be efficient? I

Josh:
Bought two cars that I liked in the last year and it’s fun.

Scott:
What are the cars? What are the cars?

Josh:
I got a G wagon last year and then I just got a Porsche GT three. So I got two cool cars and they’re fun, but that’s not the motivating drive at all. It’s like I get them to look in my garage and be like, I cannot slack otherwise I got to give the car back. It’s more like a standard setter I guess. But yeah, I was making a hundred KA month in a $900 a month apartment driving a Honda Civic. I was fine two years ago.

Scott:
Sorry to interrupt you there. You’re conveying lessons, you’re conveying, hey, help me understand how I think what I’m hearing here and I’m reacting to is, yeah, it would’ve been great if I’d done this at 23, but let me ask you some hard questions here. Do you regret not doing any of the partying or some of the other social activities that maybe some peers were doing at Ohio State at that point in time or I’m trying to understand the costs associated with this incredible outcome that have come in place here and can I pick up nuggets from you if I’m not willing or able to commit the a hundred hours of just pure intensity that you’ve sustained now for seven, eight years to get to this point? Does that make sense?

Josh:
For sure. There are definitely costs. This is not all upside. I mean I had to sacrifice a lot of family time. I literally didn’t see any friends for two years, like nothing, zero row, I guess parties would’ve been fun. I mean here and there in this journey you do get lonely. It’s eight 30 on a Friday and I’m tired and I just worked all day every day, but I have these things that I’m trying to implement so that I don’t have to do this again. So I’m just going to sacrifice that night and then I’ll sacrifice the next night. I’d rather do it now or be really intense for a couple years and then relax for 50 years to some degree taking advantage of leverage of money and labor. But yeah, there’s definitely emotional sacrifice that you have to deal with along the way. It’s not all upside.

Scott:
Josh, I would really like you. Could you reach out when you do, take that foot off the gas and come back on the show because that’s going to be, that’s a super interesting, I think that’s one of the things that’s coming to me from this is I have no doubt anything had happened. You could lose it all with all this, but this is consistent with what I would expect to hear from the extraordinary numbers you talked about and posted at the beginning of the show here as the cost to achieving that. And I just wonder, I’m curious about when you will take that foot off the gas and what life will look like at that point because of the ridiculous amount of options you’re going to have at 25 and then 27 and how that’s going to explode for you. And I’m just super curious. I don’t know, I don’t know very many people like you. I haven’t talked with Mark Cuban or Mr. Wonderful or the other Shark Tank people that probably went through some sort of parallel journey here in tech or whatever to get to this. But I’m just curious what it will take for you to feel like you can take your foot off the gas and ease up and what you’re going to do at that time. I dunno if you thought about that.

Josh:
No, that’s fair. What I’m trying to achieve is the conflict is I can still grow my dollar per hour by working harder in terms of volume on a daily basis. And I have not mastered anywhere near people or teams or other forms of leverage or media. I haven’t gotten to that point. I’m starting there, but that’s where I have to get to in order to not have my physical hours of working on something be so valuable. So that’s just the conflict of being an operator, switching over to an owner it seems.

Scott:
Yeah, absolutely. But I will tell you this, I run BiggerPockets with all this and every day at six o’clock, six 30, whatever it is, I stop my work and there’s always a hundred grand activity that has to wait until tomorrow or a million dollar decision needs to go there because there’s other things there. And it’s like that, I dunno, I’m empathizing with what you went through here because the same thing was going on for me in the early stages of my wealth building journey. I was nowhere near as successful as you are at this age or three or four years into my journey. But I read a hundred books I house hacked with all my free time. I would wake up early, read a book, go to work after work, write for the BiggerPockets blog, research my next real estate investment, or try my next side hustle.
And I sustained that for a period of five years or whatever if I had started at 20 and really actually grounded out the way that you did and the way I admire something different. But I’m just curious. It is just a philosophical thing around there’s always more to chase on it. And when you have people involved and employees in those types of things, the leverage compounds even further. And that was a hard one for me, thinking about as a CEO is like, well, it’s six o’clock and yes, I could make 50 more thousand dollars if I work through the night on this one, but should I can, is that sustainable? So anyways, something to think about and I think that, I don’t know if I’m really dancing around it, I just haven’t explored it as much with people on the show about what this cost of the success that you’re experiencing is. And I think that’s it. It’s that there’s always the opportunity cost to your time is so high now it presents conflict about the other parts of life.

Josh:
Yeah, no, it totally does. And I love the gym and working out and being physically fit and I had to sacrifice that. I mean, I wasn’t getting overweight necessarily, but I was just not making it a daily part of my life and now I am again. And I implemented that and it was a struggle like, man, I could do something else, make money or whatever. But once you get over the hump on one thing, then it gets comfortable and then you can go on to the next, go on to the next.

Kyle:
I was just going to say, in hearing you both talk about your journey is just really, really interesting. Hopefully our listeners are really getting a lot out of this. I am. So if no one is getting anything out of it, I’m enjoying it. But this, I am hearing seasons of life and I think it would be really cool to have you back on Josh down the road because from what I’ve seen with different investors, different business owners especially, there is a grind for a season and the people that come out later in life with fewer regrets usually are better at determining when seasons change. And I’ve seen that again and again. I and I feel like I’m like a fatherly figure talking to you right now or so. This is not, you are way more successful.

Scott:
This is what I was getting at Kyle. This is perfect. Thank you. This is what I’m trying to wrap my head around is total aberration and this will not continue for 30 more

Kyle:
Years. Well, yes it can and people do continue it for 30 years, but they pay a higher price. I think there are seasons for everything. I mean in families, there’s a season for young kids, there’s a season for just busting your tail, building a business, but if you do it until you’re 35, you’re going to have a heart attack. I’m listening to this and it’s so cool that the season that you’re in is just like a crush it season. But I think what you’re going to run into is that you have such a drive and intellect honestly of analyzing and re-analyzing for optimization that you’re going to have to at some point figure out when does the season change where that optimization is not the goal anymore.
You’ve mentioned a big why here, revitalizing part of your city. So where does that transition take place? When does that transition take place? And you always have to, there’s this opportunity concept. There are always trade-offs. You always to move into another season, you’ll always give something up, but it just has to be better. You just have to remember that you’re giving up for something better. But this is just amazing hearing what you’ve got going on. But that’s why what you said, Scott, having you back on in three to five years and be like, okay, are you about ready to have a heart attack or have you figured out what is the season the same or has the season changed? I think it’ll be really interesting because you’ve got, and I think people listening to this podcast, they don’t have to be going a hundred hours a week to be relating to this. They might need to grind something for a bit, but be ready to shift seasons before you lose your marriage, your kids or your life to get a little serious on it. But yeah, this is just, let’s move on to the next thing, Scott here, but I just want to wrap that in that seasoned thought

Scott:
There. I just think that is the main thing because again, Josh, we don’t typically talk to folks like yourself on BiggerPockets money because BiggerPockets money is really geared towards folks trying to accumulate maybe a few million dollars and call it a day and retire and reap the rewards of that. I think what most people want who are listening to BiggerPockets money is I want to walk my dog on Tuesday afternoon at two o’clock and not have to worry about a work call, or I want to travel through Europe for six months and hang out, or I just want to chill at home and homeschool my kid or whatever. And I think that yours, yours is a completely different take than what we’re used to on BiggerPockets money. Obviously the real estate podcast has much, many more ambitious entrepreneurs like yourself on there. And I’m glad that we explored this concept because I think that’s the story here. The story is yes, you are a super talented, genius level ruthless optimizer with your time making a huge impact, making tons of people better off sellers, buyers connecting the dots, housing. You have a big goal in all this, and the cost is a hundred hours a week sustained for four or five years. And I think it’s just really illuminating discussion here. So thank you.

Josh:
Yeah, I know that if I worked a hundred hours every week for the next 10 years, I would probably die to a heart attack or stress or something. No, I’m not. No. I’ve scaled it back. I’m probably 60, 70, maybe something like that. But one of the biggest joys in my process is honestly teaching people around me to do as much of what I’m doing as they’re willing and wanting to do. So one of my goals was to help five people make a hundred thousand dollars this year. I think I’m going to hit it and then try to double it next year and then see those people help other people. That’s been one of the coolest things in this whole process, honestly.

Scott:
Awesome, man. Well, where can people find out more about you? Josh,

Josh:
You can connect with me on BiggerPockets or message me. It’s Josh. Janice on both. Then I’ll respond.

Kyle:
Do you need to do a better job on social media? I don’t feel like your time on social media is not worth it. It’s just a black hole anyways. You just keep doing what you’re doing.

Scott:
Yeah, I think you’re doing just fine here. Well, Josh, thank you so much for coming on the BiggerPockets Money podcast. Thank you for taking us down this philosophical rabbit hole here. Whether that’s not where I think I was expecting it to go, but your journey is just so extraordinary and poses some really interesting high level questions here. Congratulations on all your success and the huge optionality you’ve created for yourself. And yeah, come back on when you’re entering the next season of life. I was really curious to see what that looks like for you. I could see it going in so many ways and you’re going to have such good choices for whatever that looks like. I appreciate it. Thanks for having me on, Scott.

Kyle:
Pleasure, Josh. Thank you,

Scott:
Kyle. Alright, that was Josh, Janice, Kyle, what’d you

Kyle:
Think? I mean, I’m just kind of speechless. This was just a lot of fun. I loved how you kind of grilled him on his financials at the beginning to just dive in and make sure that we’re talking to someone who’s legit and he is. This guy is just unassuming. Hands down, get it done, analyze what I did, redo it better and just rinse and repeat. This was really neat to talk with Josh. Yeah.

Scott:
I’ve learned over the years to be a lot more skeptical about these kinds of claims. $5 million by age, 23, $4 million in equity. That’s 60% of his portfolio. What was that? Five, $6 million implied net worth by age 23. But that’s why I went and we’ve learned to press on that because we’ve had a couple of folks over the years that haven’t been all that on there. We haven’t gone in and seen a financial statement from Josh, but I think that he passed you and my sniff test of telling the truth about what’s going on here. And I believed him. And as a bonus and just a little dig here at certain individuals, he’s not selling a $50,000 mentorship or mastermind or whatever class around this. He’s just hustling with his business and trying to sell, buy and sell real estate and accumulate as much of it for himself as possible.
So I believe him and trust the guy. Maybe I’m wrong on that and we’ll find something out. But congratulations to Josh. I think he’s built a wonderful business and has an awesome thing. And I think what was even cooler about today’s show is understanding the cost. And as much as I admire Josh and what he’s achieved here, Kyle, I’m not sure I’d trade places with him and some of those things because of what he’s given up to attain it. And I think that’s an awesome lesson from this. And that’s not a dig on him at all. It’s a compliment and appreciation and I admire what he’s done, but I also recognize the sacrifice and not having college, not seeing friends and family and putting in those work weeks to really bust it out and get to this position. He’s going to have way better options than anybody I know by the time he’s 30 in life as a result of that. And so he’s super successful. But I think that was a super interesting and powerful takeaway from the conversation today.

Kyle:
Yeah, for sure. That discussion on trade-offs, it was just so good. I think that’s something that everyone needs to think about. We all live different lives, we all have different priorities, we all have different stages of our lives. And what works for Josh might not work for Scott or me, but it might and it might in a different season or the same season. But that was a really neat thing to dive into what he had chose to trade off for his vision of the future. And I think that was pretty neat.

Scott:
And I think another thing is if anybody’s coming out there and saying, here’s a hack on how to do this. Here’s how to get to Josh’s outcome without the cost that he put in the things that he’s given up, you should run away. That’s not how the world works. That’s not how personal finance works. That’s not how outlier success, like what Josh has seen here works. It is an all out commitment sustained for multiple years. And if you go that all out and if you’re smart and if you worked that hard and that smart, maybe you got a crack at something like that, what Josh has had, but not without that combination. Well, Kyle, should we get out of here?

Kyle:
Yep. Let’s jump on out.

Scott:
Alright. From this episode of the BiggerPockets Money podcast, he’s Kyle Mast. And I’m Scott Trench. Say, peace out Girl Scout.

Outro:
BiggerPockets money was created by Mindy Jensen and Scott Trench. This episode was produced by Eric Knutson, copywriting by Calico Content, post-production by Exodus Media and Cris Mikkan. Thanks for listening.