Ep #457 – Philip Michael – From $79 in his pocket to $57 Million Real Estate Portfolio
How to visualize your success
- Leveraging your strengths
- Get a bigger “Why”
- Acting “as if”
- Now is the time to create, innovate, and pivot
- The power of declarations
- Visualizing your way to success
- Power moves to those who serve
- Turning weaknesses into benefits
- Living with intent
- Maintaining positive expectations
To find out more about our guest click here.
Full Transcript Below
Ep #457 – Philip Michael – From $79 in his pocket to $57 Million Real Estate Portfolio
Rod: Welcome to another edition of How to Build Lifetime Cashflow through Real Estate Investing. I’m Rod Khleif and I am thrilled you’re here. And I promise you you’re going to enjoy this interview today. Now we are interviewing a gentleman named Philip Michael and if you don’t know Philip he emigrated this country, was seventy nine dollars in his pocket in 2014 and now has built a 57 million dollar real estate empire. He’s a prolific writer, super great energy, seems like a super nice guy. I’m really excited to get into his life story and and how he has built a success. And I saw this this awesome quote that from Forbes that said the mission for Michael is to create a 1 billion dollar millennial owned real estate community by 2025 and with business remaining on an upward curve. He’s well on target to achieve that aim. So awesome awesome to have you on the show today my friend
Mike: Thank you thank you very much. That was very flowering for you to say but I’ll take it. Thanks
Rod: All right that’s right. That’s right. Any press is good press well that was good press. So listen, you know you’ve got a unique story and I want to drill down on it but maybe you could just start by kind of giving people some background you know where you’re from how you got to where you are now. I know you’re also an incredible writer, a prolific writer. So let’s give my listeners kind of a you know
Mike: Absolutely, I will make sense of everything. So my background is, I originally, I’m essentially an entrepreneur and I feel as though business, a lot of people want to get into the hacks and it’s tips and the tactics and the secrets but essentially and this goes back to what you said up for one on the air is that the principles remain the same, your work ethic. Do you set goals? Do you work diligently? These are basic components that you require in any business and I feel like those principles are universal. Now so my background is in media and the reason I got into media was because I really like sports and my nephew had just turned professional so I wanted to, he could go play all over the world I could be in the stadium with him just writing about it. That was my silly dream as a young man. But in effect, the reason why I am I have the relationship with business and what drove me to become an entrepreneur is because my father had a business for a long long time. He has a commercial real estate portfolio. He’s develop office buildings he has a multi-family portfolio to this to this day that he operates. He owns office buildings with his brothers. So there’s five boys all together my father he has four brothers and with the exception of one, who’s actually a manager at a bank that gives us a line of credit and check this out, 2.5% non-recourse up to 12 million. We paid it quarterly and we use that to develop. So,
Rod: Nice
Mike: But the other four were entrepreneurs. So he never really pushed me that direction sometimes I wish he would have but he was a type, he was so nice, he didn’t want to push us that way he went he wanted us to find out for ourselves which is where I eventually did right. So anyways he had that business side and I just got to see that without and just innately understanding certain things without actually pursuing it. So I came here to go to business school and I was a trained journalist in Danish, then I went to Hawaii for journalism school as well and it was at that point in time I realized, that’s how the work probably wasn’t for me, I probably had some bigger dreams. I remember I started applying for Business School and in my essay I wrote I want to own buildings in New York, in Florida, and in in Europe. So that was one of the starting route and I came here and I just utilize because when I was, when I came in New York, yeah I was thirty years old, I didn’t have any money I came with $79. I didn’t have a Social Security or Green card at the time, that’s the process. So I couldn’t work even though I had lots of education. So what I just fell back on it was me being able to write and what I did was I book three nights on the hostel, has cost me $52.38 I still have the receipt and has this figured out a way to extend my stay and without getting into too many details, I was winning writing competitions where I would get paid on Paypal and then there one of the people that was involved with that was a former broadcaster and ESPN/ANC was a former commissioner of the New York State Athletic Commission. He was very much of boxing and he invited me on this show on Sirius XM as a guest then I ended up becoming a regular. Long story short, I was able to build a network in media using the ability that I had. I would reach out to financial publications and say this is how I start building network in real estate. Say hey, I know you guys have lots of information on stocks but real estate is the largest assest class in the world. I realize you guys don’t have that. I can give you free articles. Are you guys interested? So next thing you know I have a platform and I went and interviewed people started building relationships that way. Long story short, I got with a commercial real estate news and media company called Biznow Media, was the largest at the time, started as the editor, reporter-editor, and later director of content strategy and what’s that sold, that’s when I bought my first building
Rod: No kidding wow that’s quite a story
Mike: Not selling, it’s the leveraged relationships and then I got into the end game which was commercial real estate, was really the reason I did that was I realized the pillar every billion-dollar fortune, every fortune was real estate and it just hit me. Wow, that’s what my dad did all along
Rod: Nice nice. Isn’t that funny? You know you’ve got these parents I’ve got kids that aren’t doing real estate. I’m like they’ve seen the success, they’ve seen the trappings of success, they send the lifestyle that I have, and it takes something else to get their interest in it and the same thing happened to you in that hilarious you know well awesome story and I want to actually hammer home a couple things that you said my friend and that is you played to your superpower and you pivoted your superpower into real estate at this point. Who would, you know even I would have never thought to go from writing to real estate investment. What an incredible leap and guys, so those are you listening if you’ve you know there is, everybody in the world has a superpower of some sort. See how you can leverage it to capitalize on what it is that you to do, what it is you love, whether it’s real estate or not. And that’s just a fantastic example of that and you use that to build relationships. You use that to get into the business kind of through the back door really through a marketing
Mike: Absolutely yeah
Rod: I love it. I freaking love it. So tell me what you’re doing now. You’ve got this big project that’s gonna blow people’s minds. You’re developing something, talk about that for a minute
Mike: I have a few projects that I’m developing but like the Forbes article sort of alluded to and what I told them in the interview is that our large addition right now so and I say this with the utmost humility and gratitude but if my goal was to just live for me and just live a life where I can just travel and just like really do nothing, I could do that obviously money would, but with careful management, I could just do nothing for, I have a long I want to really. But it was just about that that you need a bigger why and my why was I realized I had less effectively than a homeless person because I didn’t have a social security room. So I couldn’t even go to McDonald’s and ask for a job because I wouldn’t be able to pass the
Rod: Training sure
Mike: Yeah I wouldn’t be able to. So one of the reasons was I went to business school I went to all this school and it didn’t really teach me the tools. I have my own personal thoughts and feelings about education. Now you know certain curricula outdated and the most critical things we need, sales training, financial literacy, tax credit, isn’t really taught. So I went out and practically learned by speaking to people becoming a writer. So the thing was I did was I knew nothing about real estate. So I would do these articles that are called Q&A. Basically, I asked some questions, I transcribed what they say, that way my ignorance wouldn’t be exposed because I would just write what they said. And I would ask very basic questions. I said okay, I remember the first guy interview was a guy who started the one of the biggest commercial real estate brokers up here in New York and they sold for a hundred million to a company called Cushman & Wakefield. So I asked him where’s the market go? It was basic question. What is a REIT and why do people like REITs? And anyone explained and really I would use Google. I would just look at glossary and real estate terms and just phrase them as journal
Rod: Wow
Mike: And that’s how it were and essentially it became self-taught that way and really
Rod: Can I stop you there for one second because I want a hammer, guys you know I just talked about this at my two-day boot camp last weekend about acting as if okay. Acting as if you’re already successful and Phillip just did the same thing via questions and not exposing ignorance and I love that, the way you coined that because guys, you can start a meetup group, you can start a Facebook group, you can do an Instagram and interview people and because by virtue of the fact that you’re the one doing the interviewing or presenting or hosting, even though you may be still be fairly ignorant about the subject matter, you’re positioned as an authority
Mike: And credibility
Rod: Exactly for credibility, so guys this is a you know I wanted to hammer that home. You can do the same thing okay and there’s so many incredible platforms now that you can utilize with social media. I mean good God, my podcast just hit 8 million downloads. It’s unthinkable and it was never my plan but there’s so many ways, YouTube, so many social media platforms that you can utilize for this. So I just want to hammer that home buddy. I apologize for interrupting
Mike: …that point because a month and a half ago where everyone was living, so by nature I’m the type, I will always look at the glass half-full. I’m looking, okay the status quo is this way, what opportunities created from? because again there’s this Shakespeare quote that I’m particularly drawn to, there’s nothing good or bad except thinking that makes it so. So basically, there’s no value builds into anything except for the one that we assigned to it. So I looked at, okay yes this is tragedy, yes this is difficult, but now what? So what I said was I did a video I said this is the time but you can take advantage and start creating content, this and that. Let me show you something, since I did that, my following grew from just my friends to 30,000 on Instagram
Rod: No kidding.
Mike: Yes and my
Rod: And you’re dead right. Now is the time to create. Now is now time to innovate, now is the time to pivot. And I want to circle back to something else you said, life is about meaning okay. So two people can experience the same thing and place completely different meanings on it. And so you know as it relates to that previous thing you just said, it’s like that quote and it’s really all about meaning and so, but that’s awesome that you that you put that out there in the universe
Mike: That’s exactly, it’s funny you said that because I was speaking to Martin and I was telling him so just really quickly about the developments we’re doing. We’re doing this 10 million-dollar, they tell me it would be its the terminal value once built, but it’s around 100 bed complex by Temple University and it has these AI power components to in this and that
Rod: Oh cool, so student housing, a student housing
Mike: Yes
Rod: Love it
Mike: We can get into it in a second about, some people are asking, what about how will this impact students housing? We’re very well hedged against that. So I can discuss that and second also but what I was like this is, look, I need to start marketing these things, can you please help me shout me out on your platforms that get to 10,000 so I can link to it in my stories and he said to me he looked at me and said, you don’t need me, you’re already there, and he’s this clear, you have a million followers. And the second he did that inside days is shot from six thousand to eleven tops inside days, one video got picked up, went viral, and is just sort of taking on a life of its own. It’s just that we declared it. So that’s one of the things we call the planting seeds, did we do together with each other accountable and talk about cuz him coming to Barcelona
Rod: Let’s talk about that for a minute because we haven’t brought that up. So you’ve got a nephew who you basically consider a brother who plays for Barcelona as soccer. And guys, if you don’t know anything about soccer, Barcelona is like the is like the crème de la crème in the soccer world okay. That club is the club okay and so very very cool so they didn’t know that so please continue
Mike: He signed on this club because he came from one of the lowest clubs in Spain. So one of the biggest new and stories in sports. So there’s really incredible journey of manifesting this things that he and I talk about every single day. And so this play that declaring that and like we tell your listeners to is just go out and we also hammer home this, act as though you are they
Rod: Act as if, act as if
Mike: And then it becomes a matter of, now that we, not to get cripping, the future you that you want to be and become that now, look to another future you. And this it just brings for them forth another level of confidence, security, and the things you bring it to your life are truly remarkable. But so, in terms of the actual projects because I can get
Rod: Okay okay hold on hold on I don’t want to pass that up that was sorry I think I gotta stop you and hammer some stuff home.
Mike: Let’s do it
Rod: You know because you basically said the biblical quote which is, as you say it so shall it be. You make a declaration and I do this every morning, every single morning. I sit in this recliner behind me here and I do gratitude for the things that I have in my life, my beautiful wife of color, by the way, she’s black but my beautiful wife, my kids, my students, my foundation and I just do gratitude. But then, I do gratitude for the things that I want is if I already have them. I’m making declarations. I’m thanking the universe for what I don’t even have. I have my vision board right here hold on
Mike: Dude look at my arm
Rod: My vision board is what I look at, right here is my travel one but I do this gratitude for these things that I want as if I have them
Mike: Goosebumps
Rod: Awesome
Mike: You know I do that every single morning. I wrote an article about this just yesterday we started an accountability mastermind group where people would do this, it’s a goal setting, its really the ancient concept of prayer but the way it was really meant, declare it, the way I write it I said, active voice, present tense,
Rod: Present tense
Mike: … we asked with intent and then the technique is to visualize it as if it was a memory as though you already had it
Rod: With gratitude
Mike: With gratitude
Rod: With gratitude, gratitude is one of the key pieces okay
Mike: Absolutely is. That’s what fuels, what activates the vibration. This would make sure it comes to you exactly and that’s the thing and then I put up a video about that and people say I’ve got a hundreds of messages yesterday. So that’s why we created the group but that’s my morning ritual. I literally wrote an article about that. So it’s crazy to say
Rod: Beautiful, but brother listen you know all of you analytical ones listening that turned me off when I get too foofy, here’s a guy with fifty seven million in portfolio in just a few years talking about the same stuff. So guys this stuff freakin works please trust me on this. It’s God, the universe, whatever you want to believe in. It can be just manifesting and meditating, whatever you want to label you want to put on it doesn’t matter but it works. And awesome buddy awesome. So and this is how you manifest what you want in your life you know I show these pictures of things that I wanted in my life in the back of my planner, and I got all of them all them
Mike: You wanna hear a crazy story?
Rod: Yeah
Mike: We were on a group chat and Martin, we’ve talked about this since the beginning I said, we’re gonna own high-rises together. I’m gonna sit by the waterfront in New York City and you’re gonna be in Madrid. Now, we just bought the house of Madrid and now we ended up in Barcelona. And in the group chat, we took a picture randomly of our breakfast table. I’m gonna show it to you privately
Rod: I love it
Mike: And I, dude look at where we’re at right now
Rod: …because you declared it, because you declared it you know and that’s the power of that is so freakin powerful. I’m trying to think of the singer ten years ago posted on Instagram that she was gonna sing in the Superbowl and she’s sang in this last Super Bowl. Her name’s escaping me
Mike: Faith is important also
Rod: What’s that?
Mike: Gratitude but also fiath
Rod: Of course, you have to have faith. You have to believe it. And that’s why you do gratitude as if you already have. Sometimes I’ll do gratitude and get emotional on things I don’t even have yet you know
Mike: Right, because they’re in our system, in the orbit, they’re just coming slowly
Rod: There it is
Mike: It just works. Even the view I have now, I had a picture of it in my first property.
Rod: Alright, I gotta show you something you know, people have listened to me have heard this before, but in the back of my book here, I’ve got pictures that have been in here for literally twenty years, first are my gratitude pictures. I told you all starts with gratitude, they’re my kids when they were young okay. But then the stuff that I wanted you know let’s see here, stupid crap like watches. I got a few hundred thousand dollars for the watches you know the material things the Lamborghini, the Rolls, the Bentley, all this stuff that I got. But let me show you something just because you talked about a picture. This, you know I knew I wanted to live on the beach that looks just like the house I built on the beach which I lost. But look here, this is, I live in a compound now and you can see it those of you on iTunes can’t see it but you see the walls in these pictures as walls in both these pictures these concrete walls. I live in a compound now. Look behind me, it’s the same freakin’ picture and this have been in here for 20 years. So there’s another example of what you’re you know exact same thing you had happen.
Mike: Yeah and the thing is this, it doesn’t even subscribe to me. I’m not even amazed because, so I’m not amazed, I’m grateful for taking breath every day for this a natural extension of my life. So I can totally see it even the view of looking at is the exact same picture, I put in that place and I said, this is what I want to have. And it doesn’t surprise me anymore. So this is saying what we declare it with I mean, everything I do is really that manifesting because the information I need will come. I don’t stress over my new shape
Rod: You don’t worry about the how, you must be focused on the what
Mike: Exactly, the what exactly, what you want and then again the gratitude for me comes from my why because again you know again so my father just like you my father’s white and my mother’s black right. One of the things for sure you know there’s a big wealth gap between minority communities America
Rod: Of course
Mike: And the one thing is absence of financial literacy, absence of homeownership, real estate ownership, and most importantly there’s a cultural premium on consumption. So what I’m doing is this is why I feel like there’s a shift happening. So my goal is when I spell it out for the next by 2030, I want a hundred thousand new people from the millennial generation, everybody’s welcome of course have them become first-time investors and millionaires by the end of the decade. That is my aim and that’s not what I’m doing with the real estate is that I built this portfolio which is all self-funded. We have no debt here from the US. We have line of credit from that home. We have this equity created, joint venture acquisitions and now I’m granting access into that portfolio not raising money because we needed for sake cause we were all very well capitalized and let’s face it Martin he’s gonna be making upwards of 20milion a year. So it’s not about that, it is more so granting that access, have leaving something behind, having an impact because at the end of the day, if I wonder you have to bring children into the world I understand coming from Denmark if there’s abundance there’s less crime desperation all the bad things that come with that. And that’s really what my big why is
Rod: I love it. I love it. I love it. And I will tell you something, you know whenever I hear this, success is inevitable. And I hear it from students that come into my ecosystem, come into my world, and I ask them you know what makes you think you’ll be a fit to come work with us? And I listen for commitment number one of course they have to be committed. They can’t be a dabbler but then if they tell me that they want to serve the world, that they want to help, they want to do more than that their focus is outward that they want to help other people and the environment or animals or elderly or children or anything other than themselves, I know they’re going to be successful because power moves to those that serve period. It just does you know whatever you believe it’s just a fact. So anyway we have gone completely off the ranch but I’ve really enjoyed this my friend. And now let’s talk about real estate. So talk about some of the stuff that you’ve got going on right now, maybe some of the stuff you’ve done. So you’re doing some student housing. I think you’re in other asset classes as well right?
Mike: Most of our family’s mix used, I started off with buying small multifamily, digressed that and turned into development with my dad and my nephew. When I bought some smaller property, some land, went out there and got, so one in particular that really marked the shift for us was a three-story mix used property, had two two-bedroom apartments in them and a commercial component on the ground floor. Now the two two-bedrooms they had separate entrances so what we wanted to do was to just chop them up into four one-bedroom Apartments turning it into a five unit. So went to that process with one architect and it was going kind of slow then I got connected with one particular lawyer who’s behind 90% of the skyscrapers in the, in Jersey City. In Jersey City, is one of the is part of the New York City skyline, only in Jersey City but it’s just part of the New York City. If you look at a certain place, Jersey City’s where the Statue of Liberty is.
Rod: Right
Mike: So he came there inside weeks, he had gotten us a meeting because in that same building, one of my mentors owned the building. There were tenants in the building, so was the Jersey City Planning Board, they were very close, inside weeks we had doubled the building rights and the asset value just shot up and from there we went and just I did a lot of the grunt work from the pre development stage to get it to acquire the building right. From there, our asset value grew then we got into the whole. I was very patient and diligent to make sure everything was in order. There’s always this thing you know we talked about what and we don’t worry so much about the how. So a lot of times they’re things happen that you’re not necessarily ready for. So it’s very important for me to be patient because you know what you don’t know. Anyway, then we started building and the one in Philadelphia is the first one we started. Right now we were supposed to demolish that one and start building that one in Jersey City. Everything is down now so that’s push back a few months
Rod: Sure
Mike: But the one in Philadelphia, phase one is halfway done. Again I’ll send you a picture it’s
Rod: What is it? What is it specifically?
Mike: … housing, the complex is in two phases, phase one is 17 units, phase two is actually the number of beds, we’re still working that out because pre-construction but
Rod: Okay
Mike: This earmark around 85 to 90 beds for that part too – it’s has four corners. One is owned by Temple University has the football field, another by the city of Philadelphia that remains owned by us. So that’s the one that we’re doing
Rod: Awesome
Mike: … some power building, the cool thing we’re doing is, we’re incorporating Scandinavian design into the interior
Rod: Oh very cool
Mike: That would be one of the best minds and that he started the first kitchen and bath retail, before it would sell to developers at building sites from trucks, they started that and became a 30 country franchise he still has a marvelous mind for it but that type of stuff, getting beautiful design finishes for very little money, that’s why I brought him in so
Rod: I love it you know Scandinavian design if you guys have never seen it google it see how clean and beautiful it is. It’s, I wouldn’t call it minimalistic but it’s a lot of woods and it’s just gorgeous
Mike: Elegant classic lines, very elegant, something again for sports, basketball, football, America’s ahead of the entire world for what you say everyone has a superpower, Scandinavia superpower is
Rod: Oh no question, agree completely
Mike: … for the world, I feel like it gives us tremendous competitive advantage because one thing, we allude to this briefly, but one thing I’m really a big on this is feel. How does it feel when you step into something? If there’s a disconnect between the one who creates, creates the properties and the end user,
Rod: Right and you’re incorporating tech as well. I think I could allude to
Mike: That’s run from the smartphone. So one thing for example, give you first example, we got this high-rise project in Jersey City. The reason why some of the Institute’s people did want that one was because they have an underwriting checklist in terms of their of the acquisition. Number one, numbers have to work but also certain things if it’s more than point a half a mile from the subway, it’ll lose some of their for the flare it may not be as interested. This was 0.8 miles. There was another big high-rise project right next to it. What they did was they had shuttles. Now shuttles is essentially just like a bus cuz it has a schedule on top of that you have transportation, you have insurance,
Rod: Oh it’s expensive
Mike: …labor. So what I did was, I reached out to Lyft and I wanna be with Lyft say, hey, if I pay you a subscription, this is that, can we get each of my tenants three rides every day so they can take the Uber, you know the lift, you know
Rod: Oh I love it
Mike: So what became a weakness, I turned it into
Rod: An asset. Like a benefit, it’s a benefit now
Mike: Exactly, you have your own personal driver
Rod: Wow
Mike: and we can roll it into the rent it only cost me 120 a month for tenant.
Rod: Wow
Mike: And the numbers against having the shuttle, which you would have to wait for and it just became a no-brainer but something simple as that, understanding the end users, seeing that everybody lives off their smartphones
Rod: Sure sure
Mike: This made it a compelling business case from that standpoint and I think that gives us an advantage also as being a younger investor development landlord
Rod: Well you’ve got that eye, you get that eye
Mike: Built it for myself essentially
Rod: Right right right right love it. So is that your focus then primarily millennial housing, student housing? Is that is that your focus right now?
Mike: Yes, in terms of the end user, if you create a cycle and demographic profile for up near New York City, it is the one who’s the second job, has a second job out of college and the alternative is living in a nice, if you live in that “Instagramable lifestyle”, you have to have to have two or three roommates. Or you’ll have to live in a classy type of building
Rod: Right
Mike: It may not be the best for this one here it targets them where they can have an Instagramable lifestyle for the same that they will pay for, for instance, some people they will pay $1,200-$1,400 for room, our units in that particular property well not the high-rise but this one with ten units, the one that I mentioned when we get done with the building rights, that particular one is, it has a rooftop that has an unobstructed view of the skyline. So basically, instead of creating a large small building, I took it as a boutique high-rise. So it’s a totally different paradigm in terms of the approach and philosophy in the finishes and everything. There’s an elevator like I said rooftop, and there’s everything you need to take selfies that you can post on Instagram, have a good shot. And it’s that feel. So that’s an example and we price it comparable to nice apartments and two family homes. So it’s an easy decision to make slightly below the high rises and the new product that’s coming up, not necessarily high-rises just mid rising high-rises and the new price of according to that. So that’s one thing targeting those that age group and then of course students, grad school students in and around Philadelphia
Rod: Love it. So let me ask you a question okay you know I love where you know the creativity that comes into what you’re doing which is frankly unusual. It’s usually very linear, very empirical, in this business is very empirical, it’s numbers, it’s linear, you don’t see a lot of creativity like you’re expressing here. So let me ask you this um you know I’ve got a lot of aspiring investors that I’m hoping are motivated by your story. I’m sure that they are and so what would you tell them about this business what coaching might you give them, what advice might you give someone that is maybe just getting started, maybe he’s got you know one small property, maybe they’ve just done some single-family, what would you tell them?
Mike: I would tell them that people we’re naturally wired I don’t know where it comes from the competitive systems the higher consistence that is just embedded into our entire beings whether it’s in school when we come up, that people always tend to overestimate other people and underestimate themselves. So whenever they think of where they are, they think of it as a weakness. Oh, I don’t have any money, therefore I cannot, instead of going I have nothing to lose, let me give it a shot. It’s this simple shift right there so what I say if you have one property ok great get another small property then get a third from there you have a proof of concept now you’re a single family mini mogul, you can go out there. Now you can raise small sum amounts of money and go buy a couple of more. From there, you can show, most people know, buy this, buy this, buy a couple of more so proof of concept steady returns because raising money for real estate deals isn’t necessarily because just okay, I have a good deal, a good idea, and a good deal. It’s also showing one, I’m imprudent and diligent on other people’s money. Two, I can manage budgets. Three, I can complete recycle. Four, I can audit successfully do all accounting and legal and all the things that come with it that people don’t think about. But I would just say, play to your strengths. Okay one thing, the biggest thing that people can’t buy, the only thing we cannot buy is time. So one of the things that I get to, is amounts of help because people see me because in the real estate game, I’m a really young guy. They see me and go, wow this kid is whatever the hell they see I don’t even know but there’s something that they see they go okay, let me give them a hand let me help him and there’s somebody that it would just come to you ways that you can actually successfully complete. We just number one, have to believe that it’s attainable for you but in terms of practicality because I know you don’t want to get to hocus focus. It was just say, play to your strengths and be patient. Just get started. Once you started with one, do another. Here’s a perfect strategy I give the people I mentioned is on my page. A quick way to earn 8 to 10 percent returns with very little money what I recommended people is they can go, there are people that go to auctions in Philadelphia specifically, they then put them for sale on Craigslist or Zillow and you can buy those that $5,000 pieces of land. Mark that up 50%, $7,500, sell it with no down payment, only five on the down payment and charge 10% interest which is very little for $7,500 property and if they don’t pay, you just take it back, rinse and repeat. But what you’re doing is, you’re showing again your dollar returns a minimal. But your percentage returns are, you market up 25% plus you put 8 to 10 percent interest, that’s a good case study. Do that two or three times, now you can actually create a, again, the dollar amount is not very large, we’re just showing that you are capable and responsible entrepreneur who can manage real estate assets and now people can invest in a concept that’s scalable versus an idea that’s of maybe not
Rod: Oh no no no that that’s a great case study and I will tell you that you know in our materials we provide people with like a sample deal package. So if they don’t have proof of concept they can say, hey this is what we’re looking for if we found something like this are you interested? And that works very very well to raise equity for deals so yeah
Mike: Okay. How does that work exactly?
Rod: So yeah so basically you know it’s one of our deals or a deal that that we like and we put it into a PowerPoint and I taught this at my two-day boot camp last weekend and we went through an example of one and it’s just, and it’s a package that you can present to a potential investor and you can say, hey this is what we like this is what we do you know if we find something like this, should we talk? Should we you know is this the kind of returns you’re looking for is this yeah and if asset you’re looking for, is this you know in the timeline and all of that and that works very very effectively for my students. So that’s another way. I love your idea of proven concept – and certainly anytime you can do that then then then you’ve proven yourself but if you don’t want to take that time to do that, here’s an alternative that’s an alternative
Mike: Really an amazing alternative because again I like to think okay, work what you do have because whenever people look at external factors, some people say okay I will go do that to get there. But most of the time not since how people looks that I don’t have that therefore I cannot. And just removing all the excuses and obstacles
Rod: I love what you just said about the fact that it’s human nature to overestimate other people and our own capabilities and when you can either act as if or build that competence to the level where you’re confident
Mike: Yes
Rod: The world is your oyster. There’s nothing you can’t do. It’s confidence is the biggest piece of this and that typically comes from expanding your knowledge base and just taking action and making the mistakes and moving forward regardless of those mistakes
Mike: That’s exactly it. Is that you’re not afraid, people think of mistake as, okay that is in soccer world, a red card, get out of here. That’s not the case at all. It is just a learning lesson that brings close to you. Oh I’d like to say if you do cold calls, you have to do 10, you have to get rejected ten times before you develop the numbness to no longer take it personally. And that’s when sales begin and it’s the same thing, you have to not fail necessarily, have setbacks that prepare you. Go through the emotional feeling of like, oh my God this is that deal with that and then go on. It’s just so important most people don’t, most just don’t do that
Rod: No, they’re afraid of the rejection or they fear failure not realizing that we fail our way to success you know I tell the story of a meeting you know guys, I’m sorry because I know you’ve heard this a lot of times I just want to share this with Phillip and that is I tell the story of meeting Sara Blakely, the billionaire owner of Spanx, you know the women’s undergarments and yeah and she started with $5,000 and now she got a jet and she’s on the cover of… cool lady cool cool lady but her dad used to tell her, asked her and her siblings every night at the dinner table, what have you failed at today?
Mike: Wow
Rod: Is that an awesome question to ask your kids? Yeah so you don’t fear failure
Mike: Yeah that’s what you want to instill in the children.
Rod: Yeah I love that. So, and you know and listen I’ve had 24 businesses that I’ve built and I call them seminars. I call them seminars by the way I don’t call them failures and several have been worth lots of money tens of millions of dollars but most have been spectacular flaming seminars okay and failures. And so and that’s what we do we you know and those are you listening guys don’t fear failure. Fear being in the same freakin place a year from now that you are right now unless you love where you are right now right? All right. So let me ask you this, were there any early failures in your life that contributed that turned into things that pivoted into success later? Any setbacks that, we all have setbacks but and you’ve got a great mindset around them but anything that you can think of that was a real doozy that might have contributed to future success?
Mike: Absolutely. I mean it’s a tough question on one end simply because I just don’t view life that way
Rod: Right
Mike: If there’s something that’s, if I get a rejection, I just don’t view it as a setback
Rod: Guys, guys, that’s a clue okay. What he just said is huge. I just got a hammer that home because your model of the world, you don’t stay in the setback you move past it and stay focused on what you want. And that’s so critical. So anyway I’m sorry
Mike: I really need to stop and think. One of the things that I learned more on a human level, is just lesson I learned along the way, do realizations. One was around 2011. One of my favorite places to hang out was Barnes and Noble. I would just go through the books and just like feel like which one do I like and one I go through was, it said, there was this challenge in there, don’t complain for two weeks and complaining about, oh this sucks or this is that because what that breeds us, if you stop complaining you start assuming accountability. Once you start assuming the accountability what that does is it makes you realize like you said the world is your oyster, everything is attainable to you however it totally removes the crutch and the comfort of excuses. So you really have to be ready for it. There’s no longer that out where you can point to everybody else for your circumstances. That’s the flip side but everything else belongs to you. So that’s the upside. So once I started realizing that I go okay, it got to the point where people could really do nothing to me to accept me and I had to sort of pull back from that because even if I knew, oh I should be upset here I would have to fake it so that was like is everything is about balance. So and that was one thing another thing coming from Denmark, it’s a very utopian society because one, there’s not really poverty. Two, because there’s no poverty, everybody has access together and that’s just naturally embedded into my personality because I feel this was, if you just tweak certain things, everything is attainable to you. So that’s why I try to empower the people who, my audience specifically I like to call it demystifying money. I’ll break down a million into what it is because it seems so elusive and far-fetched to something people cannot reach. And I remember thinking that way so that’s what I try to do with people go, wow I build this and that. But anyways, in terms of so that coming here realizing that this is a totally different society. There are actually people who don’t, that don’t mean well. There are people that want to speak to you kindly not because they care for you because there’s an ulterior motive. So I started to realize the true nature of the world not that, oh this is bad it’s just if we come from his very select utopian society. So I had to learn that. I had to have some personal setbacks in terms of I don’t call it heart break or wow this person
Rod: Where you felt betrayed and things happen financially and things of that nature right
Mike: Not financially but just personally
Rod: Oh yeah okay
Mike: And they I realize okay this is not personal. One developer told me, this billionaire, he said, if people try to, if you feel they’re trying to cheat you, cheat you in the bill, just don’t take it personally just understand you’re in the business of generating revenue for their enterprise. So if they can increase the revenue of their enterprise, it’s not because they want you to cheat you they have to try. So that does something for me right
Rod: Okay okay okay
Mike: Expanding consciousness so it’s a series of lessons. They’re all in the same category which I’m very grateful for. I’ve had one example where people try to rip me off, trying to cheat me ordeals. Fortunately, I have to the capacity. I feel at least to spot if someone has bad intentions. So I just move on.
Rod: You’re probably got an incredibly honed sense of intuition. I just, I can see that just by looking at you and talking to you right now and guys you know when you’re getting into partnerships and I talked about this quite extensively, you’ve got to trust that because your brain is so powerful. It will see little micro, that we don’t see consciously. And if you’ve got something in your gut, you feel it, trust it because it’s real
Mike: Rod, absolutely. That’s the number one thing. I say like, there’s another Einstein quote, I’ll paraphrase it, it says, keep things simple, something like that but basically life is, and its very, it’s not as difficult as we make a scene like you said our intuition will drown it by overthinking things. Analysis paralysis, trying to look for there’s a lot of times where we are now is a byproduct of choice we made in the past right. And thinking systems and everything if we’re looking at things from a standpoint of, oh this experience was, this person was mean to me. We can block off blessings by realizing there’s something that’s good here but because we’ve become jaded we can kill that blessing. So that’s why, I don’t, I’d much rather live and always assume positive intent and take a few hits along the way versus living and always looking something negative
Rod: Guys, guys, guys, I hope you’re hearing this because so many of us we go through life driving using the rearview mirror and living past setbacks, past failures, instead of focusing on what we want like what Philips doing here which is an absolute key to success guys. So right now more than ever with all the crap happening with Covid, it’s managing that focus and that positive expectation that’s so critical. Well listen my friend, this has been a real treat for me and you know we’ve talked about things that my listeners have heard from me ad nauseam about you know mindset and so we’re kindred spirits in that regard and it is the secret. It’s night 80%-90% psychology. It’s only 10%-20% the vehicle, the real estate, the business, the entrepreneurship, whatever it is but it’s been a real treat my friend and I’m definitely going to connect with you the next time I’m in New York
Mike: Absolutely my pleasure. Lunch on me, coffee on me, whatever you want
Rod: I will look forward to that my friend and I really appreciate you taking time to be on the show brother
Mike: Thank you so much. It’s an honor yeah
Rod: Take care buddy
Mike: Thank you
