Justin Colby

That's exactly right.

That's exactly right.

So I don't love, so here, you know, it's funny after, I don't know how much money I've raised over time or real estate, but a lot. I don't love when people don't quite have the experience to bring people in. For sure. Because now you're creating a friendship that Dan and I can be the closest friends of all time. And then the one deal, the one deal.

So I don't love, so here, you know, it's funny after, I don't know how much money I've raised over time or real estate, but a lot. I don't love when people don't quite have the experience to bring people in. For sure. Because now you're creating a friendship that Dan and I can be the closest friends of all time. And then the one deal, the one deal.

Right, that takes 14 months instead of nine months. And it becomes a loser. And you go, sorry, Dan. And then... Now the taco nights aren't as fun for me and Dan. And it's like this. So I'm really cautious there. I'm not saying you can't. But if you do it, I would say be extremely prudent. Make sure they're well aware of like, you're an investor. There is risk of loss.

Right, that takes 14 months instead of nine months. And it becomes a loser. And you go, sorry, Dan. And then... Now the taco nights aren't as fun for me and Dan. And it's like this. So I'm really cautious there. I'm not saying you can't. But if you do it, I would say be extremely prudent. Make sure they're well aware of like, you're an investor. There is risk of loss.

If we lose together, you will eat 50% of that loss. And I will eat 50% of the loss in paperwork, in writing, notarized on documents. Because the one time I didn't years ago, I found myself in a three-year lawsuit. And I would say that because I've raised a lot of money, but I keep it very straightforward of like, it is transactional. You're looking for a return. If there is a loss, we share.

If we lose together, you will eat 50% of that loss. And I will eat 50% of the loss in paperwork, in writing, notarized on documents. Because the one time I didn't years ago, I found myself in a three-year lawsuit. And I would say that because I've raised a lot of money, but I keep it very straightforward of like, it is transactional. You're looking for a return. If there is a loss, we share.

That's it. So I think it's up to them. I have a private client right now that just did this with a friend. He wants to be a little more ambitious. I'm pulling him back and saying, hey, your guy has the checkbook. I get it. But like do one or two with them. Let him create the certainty that this is going to work for you guys. And then let him lean into like, hey, let's open this up.

That's it. So I think it's up to them. I have a private client right now that just did this with a friend. He wants to be a little more ambitious. I'm pulling him back and saying, hey, your guy has the checkbook. I get it. But like do one or two with them. Let him create the certainty that this is going to work for you guys. And then let him lean into like, hey, let's open this up.

Then it's like, all right, as long as the paperwork's there, I would have a lawyer do it because the last thing you want to do is have a discrepancy of what does the loss mean to everybody? Because that's where it gets sticky is when it's all going great, everyone loves each other. Of course. The one deal that is an actual loss, then you have to deal with it. So I would tell people.

Then it's like, all right, as long as the paperwork's there, I would have a lawyer do it because the last thing you want to do is have a discrepancy of what does the loss mean to everybody? Because that's where it gets sticky is when it's all going great, everyone loves each other. Of course. The one deal that is an actual loss, then you have to deal with it. So I would tell people.

Wait as long as you can. And then I would also then say, if you were going to do it, I wouldn't always do it on flips. And how I would structure it on flips, if you're going to do it anyways and not listen to me, that's what people do. I would give them a return. Let's just say I give Dan a 10% return and or 25% of the profits.

Wait as long as you can. And then I would also then say, if you were going to do it, I wouldn't always do it on flips. And how I would structure it on flips, if you're going to do it anyways and not listen to me, that's what people do. I would give them a return. Let's just say I give Dan a 10% return and or 25% of the profits.

That way he has an opportunity that is more enjoyable for him that like if we hit a good deal, he's gonna be making more money by having the profits. So you have kind of a lever that gives you both opportunities and then do it more in the BRRRR model than The fix and flip model.

That way he has an opportunity that is more enjoyable for him that like if we hit a good deal, he's gonna be making more money by having the profits. So you have kind of a lever that gives you both opportunities and then do it more in the BRRRR model than The fix and flip model.

Because the BRRRR model, at least you have the opportunity to fix and flip or keep it as a rental because you're renovating it either way. So you need to underwrite to a BRRRR because that way if Dan and Justin found a deal that the contractor took too long, the city stopped us, whatever, whatever, we can say, hey, let's just hold this together. It's not ideal, but at least it's not a loser now.

Because the BRRRR model, at least you have the opportunity to fix and flip or keep it as a rental because you're renovating it either way. So you need to underwrite to a BRRRR because that way if Dan and Justin found a deal that the contractor took too long, the city stopped us, whatever, whatever, we can say, hey, let's just hold this together. It's not ideal, but at least it's not a loser now.

Yeah.

Yeah.