Episode 175 | Matt King | Military Millionaire

00:00 - 05:00

What's up Military Millionaires! I'm your host, David Pere and today I am hanging out with the one and only Matt King. And if you don't know who Matt King is, well, you should, but we're gonna dive into all of that. So Matt and I met, I was probably about a year, year and a half ago, David Osborne came to speak to our mastermind group, and he forgot that he was coming to speak to the mastermind group, he was actually golfing. So it was pretty funny to have a conversation while he was golfing.

But Matt and David work hand in hand, and Matt was on the call for 30,40,45 minutes before and after. And we got a ton of value from his insight into, you know, working with David, if you don't know David Osborne, as you know, he's one of the founders of Go Abundance. He's very successful in real estate and a lot of other ventures. And he wrote the book tribe of millionaires or, in part, and he's just an awesome, dude.

So Matt lives, you know, lives and breathes and does the day to day with him and helps with you know, he's a father. He is a servant leader. He's got kids, he's got a wife, he's got work in the family office, and he's just got his hands at a ton of things. And I got so much value out of that, that I was like, you know, one of these days, I'm gonna get him on the podcast. And here we are.

Intro:

Welcome to the Military Millionaire podcast where we teach service members, veterans and their families how to build wealth through personal finance, entrepreneurship, and real estate investing. I'm your host, David Pere. And together with my co host, Alex Felice, we're here to be your no BS Guides along the most important mission you'll ever embark on your finances.

Sponsor:

Hey, guys, if you're looking to take your investing, business, life, or just yourself to the next level, then I have something for you. The War Room Real Estate Military Mastermind group is a mastermind group that meets weekly in small groups of five to six people to help you hold yourself accountable and really experience that growth. But we also have a monthly guest speaker that we bring in. And we've had guest speakers that talk about mindfulness, taxes, we’re bringing in somebody to talk about marketing, we bring in very specific topics that will adhere to very broad any any kind of real estate investing, or investing or entrepreneurship that you want to do, and will really help you out and let you ask the speakers questions and get very personal with them. And then back to the small groups, weekly accountability for what you're trying to achieve. And just being surrounded by like minded people, and they say your network is your net worth. I know that's an overused phrase. But I recommend that you check it out. So just shoot an email to wrmastermind@gmail.com. Once again, that's wrmastermind@gmail.com. And we'll send you some more information.

Matt:

Yeah, thanks for having me, man. I'm honored.

I always tell people I wish I was brave enough to serve our country. And I was always too much of a coward. My sister went to West Point. So I wore her army shirt around. And I always see people in the grocery store be like, oh, did you go to West Point? Oh, you were in the army? I'm like, No, I was a coward. I just like to yeah, I've always been afraid to serve the country. So you know in war. But I'm honored to be here grateful for service and the other men and women listening to the show service and happy to pour as much value as possible into your group.

David:

Well, I appreciate that.

Let's set the stage a little bit. You want to give like a two minute overview of who Matt is and how you got into everything you're doing now?

Matt:

Yeah, for sure.

So I was born and raised in a small town in Wisconsin. Always very entrepreneurial in nature, kind of trying to figure out what to do. Worked at a country club back when I was in high school and college, and one of the members told me that there were a million ways to make a million dollars. And I was dumbfounded by that comment for a while because, you know, I just didn't know what I didn't know. And now, fast forward, whatever. 10-12 years and I look back on that comment and go man, he was right. There literally are a million ways to make a million dollars.

My girlfriend who is now my wife, graduated from the University of Minnesota and told me she was going to move to the inner city schools of DC and I still to this day, don't think she ever asked me to move with her. But I just did it anyway, because I was like, you know, I need to follow you like, love you. You're my best friend. But furthermore, I needed to push myself and I didn't have the courage to do it alone. So I needed somebody to do it for me.

Long story short, after volunteering at a children's camp for children with incarcerated parents got hooked up with a guy named Pat Heibon, who's also a fellow founder of GO Abundance with David, one of David's best friends. One thing led to another. I got introduced to David volunteers to Go Abundance events. And fast forward seven and a half years we've lived in Austin, Texas. I work for David Osborne running sort of his family office here in Austin. Been married for almost five years. We have a three year-old daughter, a one year old son. And I think that, you know, the way that I've gotten here is just hard work and sort of being a servant leader, like you said, I just kind of, you know, what can I do to help? What can I do to help? What can I do to help and trust that God the universe, whatever you believe in, will, you know, serve me in return. And so far it's worked.

05:00 - 10:00

David:

Yeah, I mean, that is the epitome of when people run around and say, Oh, if you want to find a mentor, add value. And it's like, well, you know, what do you mean by that? And a lot of people think, oh, well, I'm here, if you need me, tell me what you want. You know. And that's not the same as just showing up and making stuff happen, right, and you volunteering at that event in DC, led you to a connection. And you know, it's funny, you mentioned that, this should never be the reason for volunteering. But I have made some phenomenal connections through that. And I think part of it is just the people that it brings out, right, like the people who are willing to, you know, both able to give their time because they are able to take some time and give back, but willing to spend their time freely volunteering for other things like that. They're usually good people to associate with. And so I have made some phenomenal connections that way. So it's cool that you and Pat linked up that way. And then you volunteer for Go Abundance. And next thing, you know, you're, you're working right in the family office.

Matt:

Yeah. And I think what's interesting to me is like, when you look backward, it's easy to connect all the dots, right? Like, I think Steve Jobs has a famous quote about that, you know, looking forward, it's very hard to connect the dots. And it's my belief that the mistake a lot of people make is they look forward and try to project what the actions today are going to lead to, rather than just making action today and trusting that it will make sense when you look backward. And so people will oftentimes expect something in return. And from my point of view, that's limiting, you know, that only creates one possibility, if you're only looking for one outcome. And I think, you know, you're spot on and saying that, you know, oftentimes, when you hang out with other people that are servant leaders are willing to give their time, energy, effort, money, whatever it is. There's really cool connections to be made, because it's kind of like minded people.

So, you know, I think it's easy for me now to say, Hey, this is you know, I served, I served, I served in it, it worked. I didn't trust that serve serve serve would lead to where I'm at now. But looking backwards, it's like, oh, that was pretty easy. You know, it's hard work. Don't get me wrong, but I would have never guessed that it would have led to this looking forward.

David:

Yeah, I almost think that's, like by design, right? If you like the subtle, the differences between like, just trusting the process and trying to force the process. It's almost like that, and it feels like anything you do, right? Like, if you're, you know, I mean, you know, they say you're 500 times more effective when you're in flow state, one of the reasons is that you're not forcing it, you're just letting things happen. And it seems that that's kind of a recurring theme in life. I mean, I remember, you know, a funny analogy that has nothing to do with what we're talking about. But I used to, I wouldn't call myself a hustler. But I used to be really good at the pool or at least, I thought I was really good at the pool when I lived in Japan. There was nothing else to do but play pool, night, day, weekend, whatever. So we would just all go play pool all the time, I got pretty good at it. And I would do really well when I had you know, a beverage or two and wasn't caring at all. And then the moment I put money on the table or thought that I was going to try to compete with somebody and actually tried to force the game I did terribly. And it feels kind of like life has this weird sense. You know, in sales, what do they call it? Like people can sense the desperation if you have to make a sales vice if you're just genuinely out talking about your product.

Matt:

Yeah, and I think the same is true of deals, right? Like when deals naturally pop up, especially, you know, real estate and in the market we're in today, like, if you force things, I think ultimately you end up getting sort of slapped down. But if you let things naturally work for you, and you have good morals, good intentions, good principles by which you underwrite and follow deals and things you're looking for in the people you'll work with. It's my belief that there's a lot of really good deals that still exist in this hot market that we're in today. If you try to force things and you try to strong arm people, I think, eventually you're gonna get slapped down or the deal won't come to fruition. So I agree with you.

David:

Yeah. Yeah, that's cool.

So could you give, I guess, the overview of what a family office is, so I've never had anyone on the show who has dealt with family offices at all. And they're really cool. So I'd love it if we could chat about that for a little bit.

10:00 - 15:00

Matt:

Yeah, I mean, the best way to describe it is that it's really just a high net worth family or group of families that are able to operate their world or their empire almost as an organization as like, you know, think of a fortune 500 company, right? Like, it's a large enough family to have a CFO and, you know, financial team and investment team etc. And I think really what's really cool about it for me is you get to sort of be a steward or servant of the family and their wealth, life, longevity, legacy, all of those fun things. And you get to see and do a lot of really cool unique things, whether it's deal flow, talent flow, mergers and acquisitions, investment, thesis etc. So, you know, it's a very unique thing, there's, you know, it's definitely a high net worth thing. So there's not a ton of them out there. And it's a very bespoke, unique thing that a lot of people don't understand. But the easiest way to explain is just a family that's able to run their life like a corporation, due to the wealth that it has in its businesses.

David:

I know, David's pretty heavily involved in real estate, obviously, would you say that's kind of the majority of what you're dealing with on the day to day inside of the family office? Or you get I mean, you mentioned mergers and acquisitions. You know, I mean, I guess what's the day to day look like for Matt King running this? You know, family office?

Matt:

Yeah, I mean, every day is different, right? Like this morning. Let me just run you through today. Right this morning, wake up, go to the gym. Well, the first thing I did was feed our one year old little 530 extra shot bottle, so he'll get a couple hours more asleep. It's a little, you know, that little crutch that we're still hanging on to and went to the gym when played nine holes of golf with David and one of our business partners talked about some things we're doing right now refinancing a multifamily with a partner so talked a little business little strategy came to the house, which is David's, David's house where I work out of 90% of the time, we started working on structuring one of our C level employees inside of one of our businesses, his compensation and earning package. We met with him for about an hour. And then I'm here, you know, talking to you guys and in between all of that, looking at emails, checking deals, making sure deals are going through, pushing operating agreements through for different things we're up to.

So I would say primarily, we're in real estate and in the business of real estate. Now, that doesn't mean just all sticks and bricks, that definitely means you know, real estate backed things like distressed debt and development, land banking, single family, rentals, multifamily, etc. I would say real estate or a component of real estate is 65 to 70% of what we do, and the rest is just a bunch of hodgepodge fun stuff that we can either find value or find yield in and take some risks.

David:

It's kind of funny to hear you say that because one of the things I took away from when he was speaking with the mastermind group was he made a statement, I should have grabbed it, so I could quote it directly. But basically, he said something to the effect of you do a lot more damage with a hand grenade than you do a sniper rifle. And that was actually very insightful to me, because I'm, you know, everyone tells you like, oh, you should be hyper focused on this one thing all the time, otherwise, you're gonna fail. And that never really sat with me because I've always kind of been a, you know, a jack of all trades, master of none. And it was really refreshing to hear him say that. And then the more I think about it, I'm like, well, there's Richard Branson, there's, there's plenty of people who've been successful and not been, maybe they were hyper focused on something at one point, but they have their hands at a whole bunch of different stuff. So it's cool to hear you say like, yeah, we do all kinds of stuff. It's not a, it's not a one size, one shoe or, you know, one size fits all or whatever.
Matt:

Yeah, I think a great way to look at it is Elon Musk. The other day, I was doing some research on Tesla and its value. And I was like, I had this thesis that Tesla is way overvalued and I should be shorting Tesla, or we should be shorting Tesla.

I’m like, why is this company worth more than all the other car manufacturers? combined? It just doesn't make sense. So I started doing some research. And what the research led me to was, I look at Tesla, like a car company, but really Tesla is more than a car company. So I think you know, to use your analogy, you could do way more damage with a grenade than you can with a sniper. I think what a lot of these really successful entrepreneurs do, as they go a mile wide on the thing, they're going a mile deep on.

So Elon Musk said I'm going to create a car that is battery powered. But in the process of doing that, he said, I'm going to create a battery company. I'm going to create a microchip company and all of these are going to be a part of Tesla. But I'm going to control the entire manufacturing process. So I'm not beholden to anybody else in the market. I can control the widget machine because I can turn all the dials when I want to. And I think Richard Branson is another great example of somebody that does that. You know, I think what we try to do is we try to do something similar in that we find an avenue we like to go in. And then we say how many verticals within that vertical can we attack and can we go after, like, if you think about the real estate transaction, for instance, you have agents, you have appraisers, you have inspectors, you have home warranty companies, you have mortgage companies, you have insurance, you have title. So there's like, you know, seven minimum, seven verticals right there, inside of a real estate transaction. And I think, you know, if you're in real estate, it's like, okay, I'm a real estate agent, can you touch any other, any of those other verticals, to continue to build sort of ancillary businesses or revenue streams that can help you scale and grow your empire if that's what you choose? And that to us is more interesting than saying, Okay, I'm a real estate agent, and I'm gonna go become a farmer or on the side and invest in dairy cows, like, you know, those are two different things that are very different skill sets.

15:00 - 20:00

David:

Yeah, I love that.

The vertical integration thing is super cool. My buddy Cory Animoto, who's a Gobro. You know, a lot of these wholesalers, like, what Cory did they vertical integrate. So he's doing a ton of deals. He's doing a lot of wholesaling. He's doing a lot of volume. Well, now he also has, you know, the construction company, the agent side, and he's a hard money lender. Well, great, like there's four verticals in one industry that you're already very involved in.

I love that I like looking I'm kind of on a much smaller scale, I'd like to pretend that I'm the same same way where it's like, Okay, is there a synergistic way to tie this into what I'm already doing that will make it an easy next step and still be worth doing?

Matt:

Yeah, yeah, I think that's the best way to say it.

It's fun, and you're already an industry expert in that space. Now, you may have to accumulate some new knowledge. But you already pretty much know the game that you're playing and be like saying, Hey, I'm an expert Pool Shark. Now I'm going to get into the pool cue manufacturing business. Like if you know what needs to be in a pool cue and you know what you like, and you know what to do, you can actually do it. Now. I'm terrible at pool. So if I were to say, Hey, I'm gonna go figure out how to manufacture pool cues, my learning curve is way steeper than yours, because you are an expert already. And so it's just trying to maybe expedite the path and rate at which you can make decisions and drive impact and value. And I think if you stay within your sort of niche, there's many niches inside of that.

David:

I'm curious. And I meant to ask this earlier, and I got distracted by a different question. But we're talking about the, you know, it's easy to connect the dots in hindsight, but not going forward.

Are you big on vision and goals? And I asked, because I know, David is huge on goals and vision. And, you know, in fact, I read a bigger pockets conference in 2018. That was his, almost his entire presentation, I think was on that. And so I'm curious if you're still very much a vision goal guy, and just not so much on like, worrying about how to get there or if you're kind of just going with the flow.

Matt:

I am a big vision and goal guy. And the reason I am is I'm trying to train my subconscious mind to move in the direction in which I want to move. Now I don't like what I said, I don't think you can connect the dots perfectly looking forward. But I think you can help put yourself in a position where the dots can easily be connected. And so I have a five year vision. This year I'm crafting a 25 year vision, I have a vision board right above where my socks and underwear are. So I have to look at it every damn day. I have goals that I review, probably twice a week, maybe three times a week. I have two accountability partners plus David that I talk about my goals and my vision and where I'm at. And I'm just trying to surround myself with accountability and things that hold me accountable to doing what I said I want to do.

Now the thing that I've changed over the last seven years is I have become a little more flexible, and not being so hard on myself if the goal changes a little bit, or things change a little bit like when I set my 2022 goals. In late December. I have this theory that if I set goals in mid December, I'll have two extra weeks in the year than anybody else. So I started working on next year in the middle of December.

Now the thing I always forget when I said these stupid intentions is come the middle of December when I'm setting next year's goals and start working on next year I still had 12 months. So you know it's just my little theory to get a head start on people but you could also say that I don't ever finish the race because I'm starting the next race too soon. But when I set those goals, I was healthy and in a really good, you know, physical state. And you know two weeks after that I ruptured my Achilles tendon and so I had to be flexible and fluid with the goals I had set for myself because doing CrossFit 75 times this year is just out of the question. I'm not going to be putting myself in a place where I'm going to be doing box jumps or anything crazy, because I don't need to rupture this thing again.

So, you know, probably seven years ago, Matt King would have just said, Screw it. I'm hard headed. I'm stubborn. I'll do it. And, you know, the 32 year old version of Matt King is like, I'll just modify the goal. I'll change it. No big deal.

20:00 - 25:00

David:

Yeah, it's funny, because it's really easy to get sucked into exactly what you just said, like, Nope, this is what I wrote down and if I don't achieve this, and so similarly, I at the beginning of the year, one of my goals was a seven figure, wholesaling, and flipping, you know, gross, seven figures this year, with the company that was only around for like, 18 months. And then I essentially had a mutiny is probably a good word. You know, it is what it is that the team went from two w two and 4-99 to 110-99, in about the matter of three days. Because one gentleman was like, I can do this on my own, I'll pay everybody better. Let's go and then, you know, good luck but so I ended up, the PSA isn't signed, but the attorneys are going back and forth, we're selling that company, I'm gonna walk away just fine. And I'm gonna focus on things that actually I enjoy a lot more because that business was much too transactional. You gotta feed the beast, it's not something that I really enjoyed as much as I thought I would so you know, works out but obviously, like, had I been hard headed, I'd be in the spot where it's like, well, now I gotta hire five more people and rebuild this whole thing that I don't even really enjoy anymore. And you know, so yeah, I agree completely. That fluidity.

Matt:

Yeah. David has a great saying he says you can have, there's two reasons you don't achieve your goals. One, you die. And two, you change your mind. Now, you know, you can't say, Hey, I want to be 150 pounds, and then plow Culver's cheeseburgers all year and go like, Oh, I changed my mind. I just want to be a fat ass like you can't, you know, like, that's not acceptable. But like, you know, you change your mind, this isn't fulfilling me, this isn't resonating with my soul. This isn't in alignment with where I want to go. So I'm just going to change my mind and choose something else. And I used to think that that was a cop up with what I've come to realize, or at least the story I tell myself. It actually takes a lot of awareness and a high level of internal awareness to say, Hey, this is outside of where I want to go. I'm going to choose something else.

David:

Yeah. Yeah, I agree.

I think that's, yeah it's funny, because it's a really difficult thing to realize that you should quit on, like, you know, quit something that isn't serving you. And it's, and it's funny, because it's so easy to get stuck in that trap of like, I don't quit. I especially like, I spent 13 years in the Marine Corps, we're pretty hard headed. You know, individuals, we are kind of asinine sometimes. And so, like, ya know, I'm gonna keep doing this thing. Why, like..

Matt:

Yeah, like I said, if it's like a workout, and you're like, Hey, I'm not. I'm tired. I'm gonna quit. Like that's different. You know, if it's like, Hey, I wanted to run a marathon, but I've torn my ACL and broke my ankle, and I have heart conditions. Well, then, yeah, probably choose something else, it’s okay.

David:

Yeah. Yeah, absolutely.

What do you think? You know, before, I definitely wanted to talk about some crypto stuff, because we chatted before the recording. And I like where you were going with that. What do you think, like having moved from, you know, DC, and just that position where you were serving into, I mean, a family office, like, your responsibilities as Chief of Staff for somebody like David Osborne, you have, I mean, you're a very busy guy. And you're all over the place, I would imagine, and you're doing a million things at once. But you're also getting to be in the room with some really successful people. And so I'm curious, like, what are some of the kind of key takeaways that you've learned over the last few years interacting with? You know, I don't want to use the word wealthy, just successful. I don't think that wealth has anything to do with it. I think it's the, you know, having just a successful life, individual, but like, what have you, I don't know, if there's anything, you've noticed that you're like, Wow, that's a really common thing or something I never would have known or I don't know.

Matt:

Yeah, I would say that there's a couple of things that bounced in mind really quickly. The first is that there's no magic bullet. Like, I always thought that there would be some little secret to success, and like, oh, once I get that secret, I can unlock this beautiful chest and all this great things will come to me and I think what I recognized is like, it's hard work. It's having some, you know, high level of integrity, having some grit and having an ability and a willingness to just keep charging forward. I would say that the one thing that I've noticed that a lot of very successful people do is they keep good track of what's going on, whether it's notes, journals, etc.

25:00 - 30:00

Matt:

They do a good job of tracking deals, they do a good job of tracking and holding talent accountable. And they do a really good job of holding themselves accountable and tracking themselves, whether that's through journaling, meditation, goal setting, etc. So I mean, a lot of these rooms, I've been in some really sick, twisted, really successful people.

One guy who's a Partner of the Chicago Cubs, and he's, you know, probably 75 years old, and he still sits there with a work journal and writes notes on the meeting. And then when you go to meet with him, he goes back to those notes and starts busting your balls over what you said six months ago. And so there's just this super high level of accountability. And I always thought, like, oh, Elon Musk, like, yeah, he just has a big brain. And he doesn't have to write stuff down. And he probably doesn't write stuff down anymore. But I guarantee you, he's built systems and processes that track things, that he's discussed, deals, he's worked on, relationships, he's got going on things that are in process, and he has a good really good way of tracking things, having reporting done on those things, and then holding those things accountable.

David:

Yeah, I like that. And I'm sad to hear there's no secret pill. I'm still waiting on the pill that makes you lose weight without working out. You know, I heard those infomercials for like, 20 years, and they don't work.

So yeah.

The fact that you mentioned the tracking and the accountability. And it wasn't just the journal. I mean, I do the journal every day, it's great. And I feel like that helps a lot. But the fact that you mentioned, like metrics and holding people accountable. I think that is probably where a lot of people struggle as they start building a team, and I don't have a ton of experience with this. But you know, I had the six, I guess seven is probably not counting virtual assistants, the most people I've had working under me. And it's really easy to fall into the trap, especially when you're small I felt and maybe this is just because I'm a high I personality on the DISC profile, of wanting to be friends and wanting to like, understand when things don't quite go your way and be easygoing. And so I struggle sometimes with, you know, holding people accountable. And so one of the things I had to wrestle with was like, Okay, we gotta put the metrics in writing. And you're gonna be involved in this process, so that when it doesn't happen, I can be like, no, no, no, this was in writing. And this was, you know, in part, your idea, so we're sticking to it.
Matt:

And I would say the one thing I would say about that, is it dehumanizes the result critique, right? It's like, if I told you, Hey, David, I'm gonna do X, Y, and Z for you. And you're like, great, man, can you please send that to me in an email? like, Sure, no problem. Hey, hey, David, in six months, I'm going to do XY and Z, and you can respond great. And in six months, we meet and say, Hey, Matt, did you do X, Y, and Z and show me the email? I have no place to hide, I have no place to run and I have no excuses. I did it or I didn't do it. It wasn't you telling me what I had to do. It was me committing to you, this is what I'm going to do. And this is when I'm going to do that thing.

And so I think, you know, the one place that doesn't work, by the way is your marriage. But you know, even with your kids, right? Like, I mean, my daughter all the time, I'm like, Hey, let's you know, set a deal for when you can watch your iPad, or if you can have macaroni for dinner, whatever the deal is. And if you achieve, set expectations, deal, and I always make her tell me what's going to happen. And I always make her say a deal because. And I want her to know that there's nothing higher than her following through on her word. And that's what I try to live by. And I'm not perfect, man, I make mistakes. You know, I am what I am. But I try to always hold myself to the highest level possible. And I always try to hold myself accountable to my word. Because at the end of the day, that's really all we have is our word.

David:

Yeah, I like that.

And so you're saying that screenshotting previous text conversations with your wife when you're mad and saying no, no, you said this doesn't work out for you very well?

Matt:

Hasn't for me yet, but I'll keep trying. If you think it's there's a possibility now. You know, the one thing I've found and I mean, I have so fortunate my wife is just an absolute saint. But like, you know, wife and business and goals are very, very, very different. And when I start trying to treat my relationship, like a goal or like a business, it just doesn't serve me like it's just not gone very well.

And again, that comes back to what we talked about earlier about forcing things right like I think the tracking the goals and stuff when you bring that stuff into a relationship, it's almost trying to force a result.

David:

You know, we've done a little bit of counseling, and it's not amazing to me how, you know, we can have the exact same conversation or maybe nothing.

Obviously, it's not the exact same conversation but a very similar conversation together. And a very similar conversation together with the counselor. And one of those conversations, we both leave feeling way better about ourselves. And the other conversation we leave, you know, not feeling better about ourselves. So, you know, it's interesting that dynamic.

30:00 - 35:00

Matt:

Yeah, and I don't know if you've studied Enneagram at all.

David:

I have not, no.

Matt:

The Enneagram is a great one, you should definitely take it and have your spouse take it. I'm an eight, which is like, competitive, aggressive. You know, my way or the highway is kind of a person at times, and my wife is a one, which is a perfectionist.

And the more I studied our differences in personality, the more I understood that the differences in our conversation ultimately resides from the way we see the world. And it's not right or wrong, it's just different.

And my wife's a perfectionist, so I always thought she was criticizing me for moving my shoes and criticizing me for picking up my socks. And my response was always like, well, your shoes are there too. And your account or stuff, like, you know, I always had this rebuttal of like, but you're doing it, that's okay. And what I realized is like her correcting me was just a reflection of her correcting herself, but trying to not beat herself up.

Now, I'm still not perfect, I still have some smart out comments, and I'm pretty, pretty witty. So I've got some good ones, at least in my opinion. But having an awareness around, you know, how we tick and how we operate has been very insightful for me. And it's given me a sense of compassion and empathy towards her and the way she's wired, rather than like a frustration and an aggravation of like, Why do you care? Where my socks are? Like, this is my drawer, you know, whatever.

David:

I like it.

Cool.

Well, you know, obviously, I want to be respectful of your time. So I've got probably two more things that I'd like to touch on real quick. First, I definitely want to hear your take on crypto because we mentioned it, and obviously we don't need to go super in the weeds. But I'm curious.

Matt:

I think Man, I really believe crypto is the greater fool game. I mean, the stock market is to a degree as well. But I mean, crypto is just another level of it. I think. Like, man, I've told everybody, I think it's probably like the world's greatest Ponzi scheme, like, we'll look back on this, and either I'm gonna be somewhat right or I'm gonna be totally wrong, and it's gonna take over the world, I'm gonna have them bitcoins in my pocket, transacting them at the grocery store. But I really don't believe that.

Early on, when crypto and Aetherium, and Bitcoin and all these things became a fad or a thing. I had somebody that reached out to me, who would you know, he's younger at the time, had already declared bankruptcy, didn't do well and a couple different things, and started giving me investing advice about Bitcoin. And when he sent me this link, it said, hey, sign up for this bit locker, whatever the heck it's called. And you'll get free credits, like a referral program, and I'll get credits. And then you can start using this program and it almost feels like those new betting games, those betting schemes. And you're like, Okay, well, it sure I'll use Bovada, or whatever to gamble on my sports book.

But Bovada is a company so they have the ability to give you referrals and stuff, because it's just them taking from them. But there's other things like how are you going to give me free money to use your platform to transact currency that you don't have ownership or any equity stake in? And I think it's Abraham Lincoln, or one of these famous old presidents who said, he knew that things were in trouble in the market when the shoeshine boys started giving them investing advice. And I think, you know, crypto and NF T's and all that stuff has become a little bit of that. No disrespect to the people that are doing it. I mean, I'm sure there's a use case, and I'm sure there's ways to make a lot of money, like I said, a million ways to make a million bucks, and I'm sure there's a lot of people that are killing it. It's just my belief that it is a great fool's game. And, you know, at the end of the day, there's no real value there unless the people say there's value and at some point, when people say there's no value, it's gonna go to zero.

David:

I've been saying for probably two years now that I view crypto as the dot com bubble. You know, I think the technology, I think blockchain is probably here to stay in some capacity. But I would imagine 95% of the current coins are at some point going to be wiped and the remaining like, 5% will be the ones that actually function, right.

Matt:

I mean, I forget the exact number but there was some sort of like, trillions of dollars have been wiped from wealth since the start of the year and in the hammering of Bitcoin and Etherium. And my theory is like, okay, that stuff just lost its value, or that money transferred to somebody else's hands. And I still can't quite figure out that answer.

35:00 - 40:00

David:

I mean, there's the, what is it recently? Luna? I think lost like $62 billion just evaporated?

Matt:

Yeah, the guy was a billionaire, the founder was a billionaire. And now he's like, eating ramen noodles. I don't know what he's doing. But you know, it's like, yeah, where did that go?

David:

Yeah, it's a weird world.

All right, that kind of leads me into, I guess my last question or questions. A lot has changed in the last few years. And we're in a very interesting market. And I'm not going to ask you to predict the market, because I'm sure you get that question. You're probably just as sick of it as I am.

But I'm curious what you guys have done or are doing, you know, with your investment strategy, that's like how you guys have kind of pivoted, and if you're, you know, trying to maintain a large liquid position with thoughts that something may go down, or if you're, if there's a balance there, or if you're still leaning into things, or, you know, just in general, what the sentiment is within the, the office as far as what way to go?

Matt:

Yeah, so I think the way to go is to continue to be in the game. There's a lot of people that will tell you, they're stockpiling cash and waiting to go in. But it's impossible, the time the bottom is impossible, the time the market, I think the best way to play it, at least in my humble opinion, is to be in the game, but just be more disciplined and more critical of your underwriting in your analysis, we're definitely trying to build up a pretty strong liquid cash position, because it's our belief that, you know, there's this whole narrative that cash is trash in an inflationary environment, which is true.

However, after inflation, when there becomes an opportunity to take advantage of real assets that have maybe again, been in distress or have lost value, I think cash is going to be king. And if you have the ability to pounce on that, that's going to be some serious, some serious opportunities.

I think commodities are really interesting right now. I'm surprised gold hasn't performed better. But at the end of the day, it's still not that transactional. So I think it's hard for people to wrap their heads around, you know, two ounce gold bars sitting in their underwear drawer, you're like, Oh, what's this? What's the point of this? I don't get it.

At the end of the day, I think interest rate risk is real. I don't think that interest rates will go to double digits anytime soon. I mean, let's face it, the government itself is the largest debtor, and it controls its interest rates. So they're going to be cognizant of that. They're going to use interest rate as a way to sort of lever on and off the accelerator, if you will, of the economy. But I don't think we can continue to grow at the pace we have, especially coming out of COVID. I mean, let's face it, we've had a really good, good long run, and a lot of people will say that we already went through a recession, and that was COVID. And while that could be true by the actual definition of a recession, I don't believe that we've actually seen the real impacts of what printing trillions of dollars does to the world.

And, you know, furthermore, I think that there's been a lot of, you know, overnight millionaires made by this crazy run up that we've had, and there's a lot smarter people in the world than me that are probably sitting behind a desk just waiting and are going to just totally pounce when the opportunity strikes to take advantage and feast off of the people that thought that they were geniuses through this.

You know, I really believe that we're going to see a pretty strong correction fall of this year, I think we're already starting to see some little chinks in the armor. But at the end of the day, I thought COVID would have been way worse, and the government printed a bunch of money. So I can't make any predictions because I don't, I don't have the rules of the game, they do. But I'm definitely trying to reserve cash for myself, the family office is trying to increase our sort of liquid cash position and, and focus on yields.

I think yield and real estate is still a really good place. I mean, I just read an article the other day that actually real estate performs very well in an inflationary environment, specifically cash flowing real estate. But I think you just got to be super disciplined, and I think you've got to be, you got to be patient. You know, I think you got to play the long game and can't just assume, hey, I'm making the decision for today, you've got to, you know, keep in mind that I'm trying to make decisions for the next 30 years.

David:

I agree, and there's a lot to unpack there. But I think that's just really solid in general. I mean, I'm kind of, I'm working to build the cash position and pay down somewhat little remaining debt I have. But the other thing is, you know, I'm still buying, I'm just making sure that what I'm buying is still at a discount, right? You've got to have that, that buffer. So definitely not getting sucked up into the idea of oh, it's gonna keep going. You got to buy it at a discount now so that even if it does drop back, you're covered. And I think that's huge.

40:00 - 45:00

Matt:

That's a margin of safety, right? You got to underwrite things with a margin of safety. And I think what we're doing right now is we're trying to build in a little bit larger margin of safety.

We're trying to make sure the cash was really strong or the interest rate risk of the deal is not going to be impacted if rates go to eight. And I think the other thing to do is be prudent about leverage. I mean, you just alluded to it right? You're just trying to pay down a little that you have left. Now, the one caveat is is it good debt? Or is it bad debt? Meaning is it you know, low interest rate debt on, you know, good rental properties that are going to cash flow forever? And if it's that, then hang on for dear life. Because I don't think you're gonna get a 3.25 anytime soon. If it's 7%, student loan debt, yeah, pay that.

David:

Most of it's the remains of a personal loan that I use to renovate a few properties, which have all been, you know, I did the you could, you could argue stupid thing, right? So I renovated, refinanced, and then rather than paying off the personal loan, like I should have, I rolled that immediately into the next property. And so I played that game, and it worked out, well, I've got enough equity to justify the cash flow and the properties were all bought under market and yada, yada, yada. But now I'm like, Okay, it's time to actually pay that down, because that one has a higher interest rate than the rest of these, but I do have them locked on, you know, lower rates.

Matt:

Yeah, I mean, the good thing is you build assets that pay you and so technically, your tenants are actually paying down that loan, and helping you build more equity. So I mean, you could say it's bad, because the rates might be a little bit higher. But, you know, you use it to amass assets and to build wealth and as a smart decision, in my opinion,

David:

I appreciate that. So we'll see how it plays out, right?

Matt:

Yeah. Now, if you get slaughtered in two years, don't call me and say, well, you said it’s a good idea.

David:

If I get slaughtered in two years, I'll rebuild and mind my own business for playing a little risky.

Matt:

As long as you're positive cash flow, you can't get slaughtered.

David:

Yeah, and you know, it's funny, you mentioned, people thinking the pandemic was a recession, I just saw, it was recorded a BiggerPockets money podcast before this. And I looked up, the guy said something, so I looked it up. And apparently, the median home price in the US was 323, at the beginning of 2020. And 429, now, which even after accounting for 11 and a half percent of inflation over that period of time is a $68,000 increase in net value.

So I definitely wouldn't consider that a recession. And my thoughts are probably similar to yours. I don't, I don't think the Fed has the balls to do what they probably should with interest rates, because it's almost a little too politicized. You know, it's like one of those games where it's like, you know, you need to increase the rates a little bit. You know, nobody's gonna like that. Do you want to play that game?

Matt:

Well, I mean, let's be honest, right? It's a self-inflicted downturn, like, I mean, the government literally has to swallow its pride and say, we can maintain the growth that which we've had, and so we're going to raise interest rates, which basically signals a downturn and say, sorry, but this is the only option we have. And, you know, in the political environment we live where a lot of these politicians make a ton of money from donors and people that have different agendas. I just, I think there's going to be a hard time to really raise I'm like you said, so it is what it is.

David:

It is what it is. I love it. Cool!

Parting shots, any book that has been life changing that you would recommend?

Matt:

Oh, man, well, David's books are all great. Wealth Can't Wait, Tribe of Millionaires, Miracle Morning Millionaires, those are really good books. I would say that the two books that changed my life were as a man think it and Thinking Grow Rich. Both of them are just phenomenal books. You know, it depends on the phase of life you're in, it depends on the message you need. There's a ton of content in the world. There's a ton of value in the world right now that can help you get through whatever you're going through. And I just encourage people to have the courage to reach out and ask for help. Have the courage to reach out and say, This is what I'm going through, what resources do you think would be good for me? And you know, I think, I think there's so many things right now podcasts like yours that will help you get over that next hurdle or that next obstacle. You just have to choose where you're at and where you're trying to go and say, Okay, what content can I consume that will help me cross this hurdle?

David:

That's awesome.

Where can people get a hold of you if they want to reach out and connect?

Matt:

Yeah, my email is I'll give you my email in the show notes but it's just mking@droinv.com.

I actually locked myself out of Facebook and Instagram because I didn't want to waste any more time in my life there. So if you message me there, my virtual system will pick up the thread and then send it to me. So you can do that too, but I won't access it. Email is probably the best.

David:

I like it. That's clever to have your virtual assistant run that, that's cool.

45:00 - 46:39

Matt:

I told her to change the passwords. Don't give them to me. I can't log in, I can't see them. I'll be like, you know, hey, today's my wife's birthday. Here's the message, can you please post it? Because the world we live in today says, If you don't post your wife's birthday on social media, you're a bad husband. But I just had to get out of it, man, I was just, it was just a life sucking trap of negativity and opinions. And I just wanted nothing to do with it.

David:

I agree, I think, yeah, I mean, and I run, you know, half of what I do is a brand and a social media platform, and I have the notifications turned off for everything. So I still have to go there. But I have to go in there when I decide to go in there, not just because someone reached out.

Matt:

Yeah, when you choose. That's amazing.

And the last thing I'll say is, thanks for your service. Thanks to everybody on this podcast for their service and who's listening and who's in your tribe and who's in your group. I mean, I take my freedom for granted sometimes. And I hate to admit that, but I wouldn't be living the life I'm living without the courage that you and other men and women have had to serve and defend this country. So thank you.

David:

Well, we appreciate it.

And man, thanks for joining me today. It's always fun, because you're not just a guy who's like I do real estate and that's the only thing I do like you get to see a whole bunch of stuff. So it's, it's good conversation. I appreciate it.

Matt:

Thanks for having me.

End:

Thank you for listening to another episode about my journey From Military to Millionaire. If you liked it, be sure to visit frommilitarytomillionaire.com/podcast to subscribe to future podcasts. While you're there, we'd love for you to rate the show. Give us a review on iTunes. Now get out there and take action.