Ep #580 – Multifamily Beginner Purchased 950 Units during Pandemic!
Jenny Gou and Steve Louie both come from corporate backgrounds in sales and management. Jenny and Steve partnered and soon were leveraging their analytical and relationship skills to take down multifamily units – and a lot of them! This is a great example of setting your goals and going for them.
Here’s some of the topics we covered:
- You HAVE to SET GOALS!
- Single family investing vs Multifamily investing
- The lessons in failures
- Leaders “walk the floor”
- The value of taking ownership
- “Do your job well and something great will happen”
- Start with your “Why”
- The definition of success
To find out more about our guests:
https://verticalstreetventures.com/
Full Transcript Below:
Rod
Welcome to another edition of How to Build a Lifetime Cash Flow through Real Estate Investing. I’m Rod Khleif and I’m thrilled you’re here. And I know you’re going to get tremendous value from the two people that we’re interviewing today. We’re interviewing Jenny Gou and Steven Louie with Vertical Street Ventures, and they’re very big in the business. Steven has over 25,000 doors and Jenny has over 900, which she got in one year, which we are going to dig into, but I’m going to leave their bios at that and let them expand on them. Welcome to the show guys.
Jenny
Thanks Rod. Thanks for having us.
Rod
Absolutely. So,Jenny, if you would start please and talk, you know, tell us where you came from and how you got into real estate and all of that, please.
Jenny
Absolutely. Yeah. Thanks. Thanks again. It’s a little about me. I spent 13 years in corporate America working for a small company called Procter and Gamble. So I was a sales director, managed cross-functional teams, launched initiatives. I really loved my job. So I spent 13 years there. While I was working there, my husband and I wanted to obviously diversify our portfolio. And like many of your listeners, I’m sure we started with single families first. So we accumulated a portfolio of 10 single families, all in the Midwest. And then shortly after we said we got to scale faster. So we jumped into the multifamily train, love the industry and actually decided to pursue that full time, at least on my end, because of the flexibility, the time, the ability to, you know, do what you want when you want to. I left my corporate job February of 2020 right before everything kind of shut down and then started a new company this year with my partner, Steve. Yeah, that as you mentioned, within a 12 month time frame, I was able to purchase over 950 units.
Rod
Wow.
Jenny
So I’m happy to talk about that as well.
Rod
So February of 2020, was that a month after you came to my event?
Jenny
Yeah. Of course.
Sure, because I did it in January. I didn’t know if I did two in L.A., so I don’t know which one it was. Wow. That’s awesome. Well good for you. What PNG, yeah, not no small company. So sales director again, no small role either. Fantastic. Awesome. Well, Steven, please expand on your background and where you came from.
Steven
Absolutely. Thanks again Rod, for having us. And you know, I’ve been a corporate America guy all my life, W-2 wage earner for 25 plus years, I call it. I went from cubicle to corner office. Right, so work my way up. Started as an underwriter on the group health insurance side and quickly realized that I needed to monetize things and moved into a sales role and worked for a large company, MetLife and the Mercer, and so was on the insurance consulting side, sales and then moved into what do they do with great salespeople? They move them to leadership and so led the, you know, half of our country. Half the country in terms of our sales force, and then had multiple executive leadership roles most recently. But halfway through my career, I met with my CPA and financial planner and really realized that I needed to do something from a tax perspective. And so about 10 years, 15 years into my career, I started investing like Jenny in single family homes, so built a portfolio just like hers. But 10 single family homes outside of California, all in landlord friendly states and duplexes fourplexes and then, you know, went to a couple of different seminars, including yours. And that was about five years ago, four or five years ago, and realized that I needed to double down into multifamily. And then started investing in a multifamily, probably have close to 20 passive investments currently right now as part of my portfolio. And then also a general partner in about seven different opportunities there. So I really saw the value of apartment investing and while I was working my corporate job at the same time.
Rod
Wow, fantastic. Now, I didn’t know you came to forgive me that, you know, I see thousands of people a year, so it’s always embarrassing when this happens. But so you were you at the same event? Jenny was at or one prior to that?
Steven
I was the one prior to that. I was on the one prior to that event. I still have in L.A. and that’s when I was all open. And then people were networking on the outside. Right. And I still have your book here. And it’s all about goal setting, too, I think you’re so good about. And that’s one of the key pieces that we learned in corporate as well. You have to set goals. So if you set those goals, the sky’s the limit. And it’s all about mindset and self. I still refer back to the goals and I have them posted. You now, And those are very important on what you want to do from a business perspective as well as a personal individual perspective.
Rod
Yeah. No, absolutely. So what was the the catalyst, Jenny, to get you in to make that decision, to have it be real estate versus a franchise or stock market investing or trading or something like that? What was that? What was kind of like the epiphany or the aha moment? In fact, I’d like to ask each of you well, first of all, to answer that question about what got you into real estate. But then I want to ask each of you what was an aha moment in this journey. So I’d like that to be the next question. But start with the catalyst, please.
Jenny
Sure. Yeah, the catalyst. Both my husband I had worked for PNG and we had all of our retirement tied into the company, which is, of course tied to the market in the stock. And we said, you know what, we have to diversify. And just through education, the aha moment was really through education, listening to podcasts, understanding why the wealthy got wealthy. And that’s when we said, oh my gosh, lightbulb, everyone invests in real estate. I think the quote is 90% of millionaires got their wealth through some form of real estate. And so I had a little bit of background growing up. My parents had invested in some single family, so we naturally just said, let’s start there. And then again, through networking and meeting the right folks, it just then ballooned into something bigger. That was our kind of aha moment. For why real estate.
Rod
Anything different for you, Steven, or very similar?
Steven
Yeah. No, very similar, I think speaking with my CPA and tax, that there’s a lot of benefits of investing in real estate. They really didn’t get into the details on that. And so self education helped me understand. I think the opportunity to learn and single family home. So I call in moving to multifamily. I call single family. You can do it by yourself, that’s why they call it single. Multifamily, you need a team of individuals really to help you. And so and that’s what I’ve learned extremely well. So really the aha moment that I would have to say is tax, the tax rate, the opportunity to follow what the government tells you to do from a tax perspective. And real estate has so many different opportunities to utilize that from a tax perspective.
Rod
It’s kind of interesting. I literally just interviewed this reporter with US News and World Report and she was talking about the new infrastructure, 2.3 billion dollar infrastructure plan and how they plan to pay for it. And, you know, and their attack on the 1031 exchange and raising the capital gains. Which is a little sobering, honestly, for a business, in my opinion, because it’s going to mitigate some of the tax benefits. So we’ll see how it all shakes out. But it’s definitely something we need to keep an eye on. So, aha moments for you Jenny and it could be a month ago. It could have been a year ago. You know, anything that comes to mind in that in that realm.
Jenny
Yeah. I would say another aha moment for me is just speaking with our investors and our friends and family who we have helped jump into the space as well. So I think this is super powerful and I’m sure your listeners would say the same. But this real estate gig, I mean, everyone says, I wish somebody taught me 10 years earlier, 10, 15 years earlier, and all these folks are now telling us the same thing. And it’s powerful because it’s something we’re really passionate about, helping others understand the power of passive income through real estate investing. And so they’ll come to us and say, hey, thank you so much for sharing this investment with us, educating us on the tax benefits.
Rod
Let me ask you this. Do you have a failure or you know, I call them seminars. Do you have a failure, a favorite failure that may have helped set you up for future success in the in the real estate realm? Or maybe it was in a previous, you know, with PNG. And I want to ask each of you this question, but we’ll start with you, Jenny. Was there a, you know, a setback, a failure, a speed bump, any point in your journey that helps you set up for future success?
Jenny
Yeah. And how much time do you have? I have so many failures, but that is part of the journey from having to let go. I take pride in people I manage, right. And so having to let somebody go from the company, I consider just at least on me. I own that relationship and their performance. And that is one of the failures I consider that I’ve learned from launching a brand of brand new brand that didn’t do well in the marketplace. That’s a huge failure in my eyes, but something I learned so much from to take to the next level for the next project. So all of the corporate experiences that I’ve had so far and very thankful to PNG for teaching me all of these things. I’ve transferred over to real estate. Right. And I think that’s been a very easy and natural fit from a project management and management standpoint.
Rod
Yeah. And I want to talk back. I want to talk about the team dynamic with the two of you next. But please answer the question, Steven, about setbacks, failures that that helped position you.
Steven
Yeah, no, I like Jenny said, we all have different set backs. We all have different things that kind of help motivate us, that’s how I look at it. So I think mine actually goes back to, you know, graduating high school. I always wanted to go to a big name college, like a UCLA out there. I did not get in. And so that made me work that much harder in my quest in corporate America as well as what we do in real estate. So some of those foundations that, as Jenny and I always talk about, things happen for a particular reason, not my wife as well. Right. So, hey, these things happen for a particular reason. And it helped me really level set that I didn’t have to go to that big school. But I still is able to get to the top of the corporate ladder, as well as being super successful on the on the real estate side. So I would say that that’s probably the one thing that I always look back at and say, wow, that changed a lot of different. The different people that I met along that path of not ended up not going to the school that I really wanted to.
Rod
Yeah. Love it. So let’s talk about team fit. So, you know, it’s very common to find I mean, I see it probably 80, 80, maybe 90% of the time where you’ll find a team that includes an analytical person, an outgoing person. And they match up just fantastically. I know that you’ve got project management experience, Jenny, but you’re both in sales. So that is actually unusual for me to see that dynamic where you’re both, you know, superstars in the sales realm. But you also said you started out pretty analytical. I forgot what the role was that you were doing, underwriting some sort. Stevens, is that correct?
Steven
Yeah. So, yeah. So super analytical individuals who started it. I was a finance graduate as well. So very technical from that perspective, but then learned that I needed to broaden my skill set into meeting people. And, you know, initially you took the standard Myers Briggs test. I’m an ISTJ, right. So well, originally so introverted. And some of the things that as I morphed and moved into sales, I believe everybody can learn sales. You can learn it from reading a book, though. You do have to actually get out there and sell. And so the one thing about sales that teaches you how to flex your style very well or are the best salespeople can do that. And so being able to flex my style in all situations really work so I could go technical if I really need to. But I really enjoy the relationship building, building those relationships with the brokers, sourcing different capital, working with our investors, and it works extremely well. And Jenny’s super sales star as well, she tends to have some tendencies to like the asset management side. And we can execute on some of the vision that I come up with. And really, like Steve, we got ten things we have to do. Let’s narrow them down to three. And then that’s where the complementary skill sets really work well. And but yet, at the same time, we can right–, you know. Last night we were at a broker meeting. In the broker meeting, we went separate ways and connected with, you know, five, 10, 15 different brokers and then came back. So we have to have those both sides of those skill sets.
Rod
So. So do you both do the underwriting or do you have someone else in the team that does the heavy underwriting.
Jenny
Yeah. So we’re–, our company is still relatively new as a whole. Between Steve and I, we actually have one other person dedicated to underwriting.
Rod
Got it.
Jenny
His name’s Randy. He’s a former rocket scientist. So super bright. And I always say if he can launch a rocket, he can launch an apartment building. So that works well for us. Yeah.
Rod
I’m sorry. I just want to stop right there and I want you to continue the thought. But it’s funny. I used to show picture. I don’t know if I did at your events of a rocket engine and I would around visualization. And I’m like, who thought of that, you know, because you got a tubes coming out everywhere and in just funny that just triggered that memory, please continue your thought. Forgive me.
Jenny
Yes. No, that’s a great analogy. Yeah. It’s kind of multi hat, double hat, triple hat in some cases right now. But if you narrow it down a little bit more, Steve, you know, will traditionally focus more on acquisitions and then I will take it out into the asset management realm. Right. So we’re both really great at strategy and vision. But I really like and really I’m good at running properties and executing the business plan. So we kind of divvy it up that way.
Rod
Nice. Nice. So did I say where I was going to go next? Because I’m drawing a blank on that in my head. Did I did I say what the next topic was going to be? Forgive me. No.
Jenny
No, we just a–
Rod
All right. Well, then let’s let’s. Good. Let’s dig into your 950 doors in one year. How did you pull that off?
Jenny
Yeah. You know, it was, you know, goal back to goal setting. So I left my job at PNG and I had I thought I had all the time in the world, but then everything shut down. My kids were pulled out of school. So a little bit different dynamic versus what I pictured. But my goal for the year was I just want to buy at least one property as a GP. Okay, but through a fast education, finding a mentor, really taking action and continuing that mindset. Within 12 months, I purchased over 950 units, three of them being passive, and then three of them being a GP slash KP. And and that’s obviously finding ways and being creative with sourcing funds, but then also really digging into brokerage relationships, working with partners to execute more on the GP side.
Rod
Okay. And when you mention mentor, we’re talking about Steve. Yes?
Jenny
Yes. Steve was actually my mentor first and then really spent the better part of a year learning how we each operated, making sure that we it was almost like an interview. You know, when you kind of talk to people and you work with them for a little bit, you kind of get to know how your values, if your values lined up, if your styles line up. And so kind of a light bulb moment clicked when Steve told me he was leaving his corporate job. And I said, okay, well then, stars aligned. Let’s start a company together. Let’s do this together. So–
Rod
Love it. By the way, guys, if you haven’t heard me mention this before, I have a partner– a book about the questions that you should ask before you get into a partnership. And if you want it text the word “PARTNERSHIP” to “72345”. Yeah, here it is. Questions when forming a partnership, because, you know, a partnership like a marriage is easy to get into, but it can be hard to get out of. And, you know, I host the largest multifamily mastermind. I think out there, you know, is about 14 billion in assets in there. And there been a couple of very big partners. And there were three, 4,000 actually 4,000 plus doors that dissolve big partnerships because they didn’t ask those hard questions. So again, that’s “PARTNERSHIP” to “72345”, if you’re, you know, thinking about doing that. Okay. So, let’s talk about this now. Do you each have families, children, just to give me a little you’re nodding, Jenny, go ahead and tell me just because I’m going to take that and go somewhere with it.
Jenny
Sure. Yeah. I’m married to my husband, Ronnie. I’m the mom of two lucky kids, Jackson seven and Zoe’s five.
Rod
How about you Steve? That’s beautiful.
Steven
I’ve been married for 20 plus years and I have a 28 years, to be exact. And then so I have two girls, my wife, my lovely wife, Rebecca first and then I have two girls. Catherine is 21 and Elizabeth is 18, so a little bit older. And we live here in Southern California.
Rod
Well the reason I drive my wife crazy when people ask how long we were married because she hates it when I say this, but she pretend professes that she does. I say, well, we’ve been married for 12 years and they’ve been two of the happiest years of my life. As a joke. Anyway, now she’s the love of my life. But the reason I ask that question is, what did you have to sacrifice to get to the success that you’re at right now? Jenny, you first.
Jenny
Yeah. Funny story, my husband actually got us into real estate first. Okay, and he– I was kind of the reluctant spouse, if you will, because always probably one of those in this relationship, in this industry got sucked in. And then I, funny enough, was the one to leave my corporate job to do this full time. And so kind of went in a full circle. I don’t think it was sacrifice is the right word. I would say actually real estate and passive investing has enabled a lot more for our marriage. Right. So, you know, in a way, right now, I technically I don’t have to work for income because of the passive income we’ve been able to generate. I do this because I love the role and I love the industry and I love helping people. So actually, we’ve gained a lot more. I have gained more time for myself and my family. I’ve gained more flexibility and what I want to do, when I want to do, where I want to do it. So it’s actually reverse. I don’t think we’ve had to sacrifice much to be in the–
Rod
Turn-off. Fair enough. Same answer or different answer, Steve?
Steven
Probably a little bit different. So Jenny is a different point. Everybody’s at different points of their lives or milestones in their lives. So for me, huge sacrifice for my family as I grew my corporate career. Right. So anybody that’s in corporate knows how much time energy, especially if you want to kind of climb that ladder, you have to invest your time just like the business of real estate. But I sacrificed most of my life for climbing that corporate ladder, which was awesome, though, right? So for me, it provided me the funds to invest. It provided me the structure there were for the business and how to run a business. So all the learning points were there. But I did sacrifice family. And so that’s one thing I think your listeners should hear anybody that. Well, I think most people that have a corporate job know that there’s some sacrifices when you’re trying to run a family and you’re commuting in from Orange County to Los Angeles every single day for two hours in and then two hours back. That’s the sacrifice to the real estate. As I moved into as we pivot over to the real estate side, I can now give a lot of my time back to my family because of the passive income that comes in that you teach so well in your your classes as well, or the opportunity that real estate opens up for individuals in terms of tax perspective. The tax perspective as well from the legal people that you bring in to.
Rod
So, yeah. Yeah. Well, you guys are both leaders. And Steve, I’ll start with you. What do you– I mean, there’s no question in fact, anybody listening to this podcast, you’re a leader and right now the world needs leaders more than ever. And I will tell you let me just expand on that. So pay attention to your focus right now. Don’t get sucked into the news. Bring in the good stuff, stand guard at the door to your mind and be very cognizant of that, because , you know, even if you’re just a leader of your family, you’re a leader. But I want to ask this question. Steve, start with you. What do you think is one characteristic that you believe each leadership possess?
Steven
You know, that’s a great question. So as a leader, something that I always did so is like walk the floor. So the leader has to know what everybody is doing. Right. So a lot of times you’ll see leaders shut the door. And this is when we had open office, you know, this is when we had offices in space and what have you. So I’m a believer that you do have to go and walk the floor and know exactly what everybody is doing. Right. And so a lot of managers, a lot of folks out there, they just they’re not connected with their team. And so the more you connect with the team and you build those relationships, they’re going to work. Want to work that much more diligently for you and the organization across the board. So it’s all about building that relationship with the team members that are a part of the overall organization.
Rod
Great answer. Jenny, how about you? Anything different?
Jenny
Yeah, I think, you know, for me what I remember a strong leader, at least at PNG and other companies, is being able to deliver ownership. So what I mean by that is it doesn’t matter if something is your problem or your fault. Right. A good leader focuses on solutions take don’t– that’s not necessarily take the blame, but take the ownership that to acknowledge what the issues are and then find a solution. A lot of times people just get stuck on the problem and blame. Instead of focusing their time and energy on fixing it and preventing it from happening again.
Rod
Yeah, and that accountability is critical. In fact, we’ve implemented the EOS system from the book “Traction in Our Organization”. And if you haven’t, you should look into that. It’s fantastic. And instead of an organizational chart, they have what’s called an accountability chart. So, you know, if you’ve got more than one person accountable, nobody’s accountable. So, you know, you focus on that one person. Accountability is very powerful. I shared that with my master mind members and had somebody come in and speak to them about implementing it because it’s just so incredible. Most of them have. Well, let me ask you this, Jenny, starting with you. You know, there are a lot of listeners on the show that haven’t taken the plunge yet. They may own a house or two or a duplex or 10 units or something, and they haven’t taken action yet. What advice would you give them? What would you tell them? That might add some value.
Jenny
I would say. Aim higher than what you think you can do. So we a lot of times will say, okay, here’s what I think I can do, and then that’s kind of their goal, their limit. We at least. you know, in my corporate days, we always say, what is your stretch goal? So what is going to make you uncomfortable, make you a little bit stressed out, but in a good way. But then, you know, you that’s what you really want to hit because that when you do hit it and you will, that’s when you will get that success in the first deal is always the hardest. The first step is always the hardest. But once you do it, you’ll get all the other things will come easily. So just aim higher is kind of my point.
Rod
Get uncomfortable because the life of your dreams is just on the other side of that comfort. Comfort zones and warm place and nothing freakin grows there. Love it. Steve, how about you?
Steven
I would say the goal setting is super important, but most importantly is execution. Right? So you have to execute. So anything that you do, you have to execute on and a lot of people don’t. So you can have the best laid out plan. But if you don’t execute on it, you’re not going to get to that next level.
Rod
Nice. Steve, what are some of the best advice you’ve ever received? And it doesn’t have to be real estate. It can be life in general, can be anything, any topic. What’s some of the best advice?
Steven
Best advice–
Rod
I’m going to have you answer it to. So be ready, okay?
Steven
Yeah. No, the best advice that someone gave me that I use all the time right now is do your job well and great things will happen. Right. So there’s so many different variables. I call them politics, landmines that are out there. And if you start focusing on all those, you’re never going to get out from under it. And so if you’re if you really just do a great job at everything you do, the sky is kind the limit. And don’t let all the other obstacles take you down. And mind you, you like you mentioned, some of the media out there today. And there’s there’s different things that you can be watching that will change your mind in different ways. So don’t let that do that. And then, most importantly, just do your job well and great things will happen.
Rod
Love it, Jenny.
Jenny
Yeah. I heard this a long time ago, and I can’t remember from who, so I’m sorry, but I’ve heard it multiple times since then and it is start with your why. I think you’ve mentioned this as well.
Rod
I’m a cynic as a book with that title.
Jenny
Yes. And I’ve watched his YouTube video. Right. And and really, that resonates because nothing will make you happy. No matter what level of success you achieve until you understand why you’re doing it. And so that was one of one of our pivotal moments. Why do we want passive income? Well, obviously, everyone wants money to live and survive, but it’s because the passive income allows us to do what we want when we want, where we want to, the freedom, the flexibility to do that. So once you understand your why, everything else will make sense and your success just becomes that much better. Right?
Rod
Love it. So let’s see. Let’s see, so this is a good question. Jenny, what’s your definition of success?
Jenny
I mentioned just a little bit earlier, it is doing what you want, when you want, where you want to because when you achieve that, that is financial freedom. It empowers you to do what you really want to do. You know, for free. You could do anything you want to do at that point. So success for me is having that freedom.
Rod
Steve, what about you?
Steven
As I reflect, as you mentioned, that your success for me was making it to the top right and some of the material things right. That was what success was. But as I realized going through all of my career, the success is really how much impact you have with your family, your friends and the people that you come in contact with. Right. And so I think some of that shifts. You know, so I think a lot of your listeners probably are at the beginning stages and they want the Ferrari or the Lambo and all those things. And those things mean a lot. But at the end of the day, it’s really about the people that you impact and make a difference in their lives. And I’ve seen that, as I said on different interviews and podcasts. Those are the things that really make people move in that direction.
Rod
Yeah. Love it. I was hoping one of you would say that. It is. You know, we all have been taught to achieve to be happy. But when you are giving back in some fashion, you’re happily achieving and you know it. And I’m sure that’s where you were going with that journey. After you have the freedom, then you can give back. But I would say this, too, though, on that note, you know, if you’re listening to me and you want this so freaking bad, maybe you want the Lambo. I know I did all the exotic cars and stupid watches and other crap that I thought was important at the time. I didn’t get back till I was 40. And, you know, and it was an epiphany for me. I tell the story and I won’t bore you all with it right now. But the point is, even if you’re young and you don’t have a lot of money, you’re saying, I’ll give back when I have it. I’m going to say that’s a mistake. Find something you’re passionate about right now. I don’t children, the environment, animals, elderly, whatever it is, and give it even if it’s, you know, whatever political beliefs you have, whatever it is. But give back in some fashion right now and you’ll be happily achieving and you’ll be fulfilled. Tony Robbins calls it the science of achievement versus the art of fulfillment. And you’re just going to get further, so much faster. Would you guys agree?
Jenny
100 %. It doesn’t have to be money. Right? It can be your time. It can be your time–
Rod
Time. That’s right.
Jenny
Exactly.
Rod
Yep. Love it. Well, listen, I really you guys have added tremendous value today. We didn’t get technical and we can have you back on to go technical at some point. But, you know, people need to see that, you know, you just have to take action. You just have to do it. You have to align with your goals and and and and recognize it’s a team sport and, you know, align with somebody, connect with somebody you align with and the sky’s the limit. So I just want to thank you guys for coming on. Again, what’s the name of your web site? It’s “verticalstreetventures.com” I assume.
Jenny
Got it.
Rod
Okay, all right. Fantastic. And I really appreciate you. And I know that we’ll see you soon. And hopefully I’ll have a live event, you can come network. I’m looking at one towards the end of the year. It’s going to be on this coast, unfortunately, because I’m gonna be lazy. I’ll go to L.A. later next year. But anyway, thanks for coming on, guys.
