Are you stuck? Not satisfied with your productivity? Do you have a big idea but can’t seem to take the first step? You’re not alone. We dive into the psychology of procrastination and list some tangible steps you can take to start moving the needle.
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How To Stop Procrastinating (Repost)
You are not a big-time show until you start reposting some of your classic content. This is one of our favorite episodes. Why am I procrastinating? As Frank likes to say, “Done is better than perfect.” It might be the 2nd or 3rd that Frankie and I ever did resonating with a lot of people. It has got a lot of downloads and we want to repost it and bring it back in classic style. Frankie is not even swearing as much at the beginning of this episode back then, so I hope you enjoy this blast from the past.
Ian, you look great in blue shirt.
I’m doing my best. Your hair starts to grow really nice and thick.
I got to live up to the artwork of that caricature. I literally have that cut out and pasted it on my mirror now. That is what I’m going in.
That cartoon artist nailed your hair. It is a perfect hair and beard.
The best thing about that is I showed that to my family and they were like, “Frank, you look like you’re bald and how come your stake is half done and Ian is drinking?” This is another episode. It is taking control of the things you want to make sure you have taken control over.
Frank and I are talking about our logo for this show because we are big-time enough where we hired an artist on Upwork to create a cartoon. Honestly, that is the best example to start off the topic of this. This poor guy, we hired him for $200 to draw pretty much a caricature as you could get at Disneyworld with your kids. You play sports, football or something, with big cartoon heads. This guy must have done sixteen drafts.
It starts off where it does not look a lot like us and then we keep poking, keep picking at it a little bit. Frank does not have that much hair on his arms. He has got my eye color wrong. My nose does not look like that. Frank is like, “Are our foreheads really that big?” I’m like, “Yeah, but I’m going to tell him to bring it down a little anyway.” Long story short, we have thirteen renditions of our logo to go back to, but the new one is perfect. We both look 22 years old and handsome.
You do not look like Mitt Romney or Colin Cowherd, which is both in the early rendition. You were like, “We don’t look like this.”
My first comment to the guy was, “This is a really nice drawing. I’m just not sure it is us.” He was like, “Okay, I get it. I will do better.” In this episode, we are talking about something that plagues anyone in any career, but definitely startup owners. Me, as always as a manager and as a creative now, as someone who writes and creates videos, I struggle with this. Your line has done as the new perfect. What we are talking about here is perfectionism. We will get into it. We disagree a little on some things, but I look at it as also procrastination.
We will talk a little about the difference between perfectionism and procrastination. What kicked us off talking about this is Frank and I are both aficionados of ‘80s hair bands. That is the area era that we grew up in. GNR, Guns N’ Roses, is one band that we share a special affinity for. Anyone that grew up in the ‘80s, I would question anyone who was not a fan of Appetite for Destruction. It is a fascinating album.
If you grew up in the ‘80s and you are not a fan of Guns N’ Roses, you are probably a Russian spy.
You suspect KGB if you do not like Appetite for Destruction. There is no doubt about it. It is fascinating that album if you hear any of the band members, Axl, Slash, and even Duff. When you hear them talk about it, it is hard to believe because the songs on that album are so iconic and good. Yet when they talk about making the songs, you would think that it was the first take. All of them say they wrote them and produced them and recorded them in 3 to 4 hours. That is how they would do a song back then. Sweet Child O’ Mine, the way that started, Slash was just doing a little practice exercise. He was warming up. He was screwing around with Duff in their apartment and Axl heard it.
He heard the main riff, which is probably a top ten guitar riff of all time, the lead guitar and he said, “Play that again. I want to hear it.” He is like, “It was just a warmup.” He said, “I want to hear it again.” He brought over a poem that he had written to his girlfriend at that time, which would become the lyrics to Sweet Child O’ Mine. Axl, instead of reading the poem, started singing the words to that poem to Slash’s riff. The beauty of this song is that they got into the studio and are like, “We got to record this. It is good.” Slash never liked it because Slash thought they did not put a lot of time into it. It was too much of a ballad.
He wasn’t into rock ballads. He thought it was weak for the concept of GNR, but they get to the studio and recorded it. It was only a minute and a half and they needed a three-minute song. They had to come up with new lyrics and new riffs into this song. That is when Axl started singing along, “Where do we go now?” Instead of singing, he would start saying, “Where do we go now?” He was doing that over and over to where Slash was like, “That is pretty good. Let’s leave that.” If you look at the lyrics, he says, “Where do we go now,” seventeen times. It is like filler in a crab cake to finish the song. Axl liked it because it was a poem to his girlfriend.Don’t cripple yourself with overthinking. Just get your work out to the market. Click To Tweet
Slash did not even want to put it on the album. He thought it was garbage. He did not think it would ever do anything. Sweet Child O’ Mine ended up being their first hit. The first song they released was Welcome To The Jungle, but it did not do well. They did put out Sweet Child O’ Mine because the label thought it would do well and it killed it. It is their best seller to the point where they then went back out and put Welcome To The Jungle out after Sweet Child O’ Mine a second time. The second time, Welcome to the Jungle hit, but the first time it did not hit. People did not like it. This is a great example of you never knowing what’s going to be a hit. If you are creative at all, building a business or products, or a writer, you do not know what the hits are going to be.
It is usually the opposite of what you think it is going to be. Most people will tell you, “This one is a sure-fire hit. You have no idea,” and it is exactly the opposite. You are like, “It is a throwaway. It is a smash.”
It is the same with anything. Frank has a real estate business. I bet you have some deals that you were sure were going to kill it and you lost your ass on it. You have had some deals that you were like, “This one is marginal. I will throw it in,” and it absolutely made you a fortune.
It is no longer this way, but the curse of death early in my career several years ago, whenever I projected something as a $100,000 profit deal, we lost money. I go into like, “We can’t lose. We are going to make $100,000.” In the end, they got to write a check.
Think about all the people that we have interviewed and hired. How many times have you hired someone that you are so excited you are like, “We can’t miss. We have crushed it. What a great hire.” and they turn out to be a maniac within a month and you are like, “That was an awful hire?”
On the opposite side, one of our best salespeople, we had a recruiter. He is no longer with us. He sent me an email. He goes, “This guy is not a hire for us.” I was like, “Bring him in. If you do not like him, I want him.”
That story with Guns N’ Roses is you do not know what’s going to be a hit. Put it out, but you can’t be perfect. They could have sat on that song for two years trying to get the perfect third stanza, which there is no third stanza. The third stanza was, “Where do we go now?” That is all he does after that. They just released it. They let the market decide whether it was a good decision to release it. It turned out to be their best decision to release it
On the opposite side, this comes down to professionalism and being on heroin, which we aren’t. They were during these stretches of time, which is a big part of it. If we are going to take a business lesson from this, the thing that you have to look at is they were living in a crappy apartment. There were drugs and booze. They were scrappy and hungry. They hadn’t made it, they were broke, and they took a chance. Two and a half decades later, they finally released Chinese Democracy. It is garbage. It has got arrangements from orchestras and all this other stuff. I listened to it all the way through once. It is overproduced. It is not relevant. It gets nothing out of you, where Sweet Child O’ Mine still stops me in my tracks.
I get fired up to hear that song, even though I have listened to it thousands of times by this point in my life because it is relevant. It is quick. You can think of where you were. It speaks to you. We did not talk about this in prep. I want to surprise you with this. I’m going to bring this up. The theme of this is done is the new perfect. Done is the new perfect. You can overthink it. You can procrastinate, or you can just say, “Screw it. It is close enough.” I flip houses. No house is perfect. Guns N’ Roses is riding high. Ian talks about their first song tanked. Sweet Child O’ Mine comes out. They rerelease that second song.
Here’s another thing that we did not talk about, Ian. Guns N’ Roses’ Lies is their second album. There are eight songs. Four of them are new. Four of them were just covers from their clubs, club day hits. They released it literally in 1988 while all these other songs were going nuts. Was it a perfect album? Was it a studio-produced album? No. It sold 5 million copies and four of the songs were a decade old. To that point, it is just like, “Get it out there. We are hot. We are doing well.” Do not cripple yourself with overthinking.
I’m going to go one more on music, but I’m going to go off of rock and roll on this. On the radio, a song from Ice Cube came on, the radio edit. It was one of his old ones. It wasn’t when he was big. It was right after he left N.W.A. It was from his AmeriKKKa’s Most Wanted. It came on. My son loves old-school hip-hop. Do not judge me as a dad. He was like, “Who is this?” I’m like, “That is Ice Cube.” He goes, “His voice is awesome, dad. He is a great rapper.”
I’m listening to the song. It brought back a flood of memories because I loved N.W.A, Ice Cube, and all that. What was fascinating, Frank, is that song is so underproduced. It is like a baseline and Cube’s voice. It is raw. He is angry. He is upset with N.W.A because they screwed him out of a bunch of money. I went back and I watched the movie on N.W.A and how all of that happened, Straight Outta Compton.
I watched the scene of when he left and when he went out and produced AmeriKKKa’s Most Wanted. He did it in no time, like in lightning. He did it when he was raw, emotional, and upset. He wrote a bunch of lyrics with a pencil, went out, and got in a studio. You picture him with a synthesizer. He went out and crushed those guys. As a kid listening to it, and even now listening to it, it is his voice. He is emotional and enthused, and it is good stuff. It is good music, but he put it out because he wanted people to know that he was talented and he could do it without the band. It is a raw unproduced thing. The opposite of Chinese Democracy is more like Appetite for Destruction, where if you listen to those songs, it is a lead guitar, a rhythm guitar, drums, and voice. That is it and it is great.
I want to finish off the musical analogies with this so we can move into the next topic. When you are young and you are hungry, it is easier to write songs. Angst-driven songs come from young and hungry. There is a famous story of Dee Snider. He is another ‘80s band guy right from Twisted Sister. Their best songs are We are Not Gonna Take It and I Wanna Rock. In both songs, Ian and I have gotten drunk to and taken our shirts off multiple times.
Their fourth album sucked. He was being interviewed and he was like, “This album is not the same. I’m an angst-driven guy. I’m sitting at The Ritz. I can’t write the same lyrics at The Ritz as I could write when I was broke.” It is hard to capture lightning in a bottle, but I want to go in a different direction with this. If you are good at your craft and your trade, which Ian and I are, which Ice Cube was when he left N.W.A, he can go out and do something fast. Guns N’ Roses had been a club band for almost ten years, together and apart, when Appetite for Destruction came out.
They were good at their craft. One of the greatest songs of all time is written by Roy Orbison. It turned into a movie, Pretty Woman. He wrote that song while his wife was walking away and walking back from the grocery store. It took twenty minutes. What I want to say in this is it is easier to do things quicker that are incredibly high quality when you have put in the work. One of the things we are going to talk about at the end of this is the difference between being a pro and being an amateur.Success leaves clues. Click To Tweet
Cube was a pro when he recorded that first album on his own. Orbison was a pro when he did that incredible song, but you can be faster. When you are in the beginning, and this is something we are going to talk about, you can often overthink things because of your inexperience. When you have the experience, you do not overthink things as much you like, “That is freaking good. I’m going to screw it up at this point.”
Colin Powell has a fascinating concept. He has a rule of the 40/70 rule. He is a former secretary of state, a four-star general. He is very accomplished. His concept of the 40/70 rule is that if you do not have 40% of the information you need, you are probably winging it, so you need to get to 40% of the information. If you are over 70%, you are probably overthinking it. You do not need that much information. In a military situation, you can never have 100% intel. Think about the bin Laden mission. They did not have 100% information.
They weren’t even sure he was in the house, but they were probably at 40%. They are on the low end of Powell’s rule, the 40/70 rule, but this rule is if you are under 40%, you are probably being reckless. If you are over 70%, you are dragging your feet and you are procrastinating something you should do. That applies to business and to anything creative. It applies to managers, employees, and people taking chances. Certainly, if I look at all the decisions that I have made, I feel like that 40/70 holds pretty well.
We hosted an event with The Collective Genius, which is a group I work with. Ian knows that because he had spoken there before. We had Jocko Willink speak, a motivational speaker, former Navy SEAL, and have a huge podcast audience. Jocko talked about this. The numbers were incredibly similar. For him, it is anything over 70%. It is go-time. It is the same kind of thing. If he is going to delegate something to somebody else, he is like, “You get into analysis to paralysis if it is better. If you are roughly around that number, you have got enough.”
It comes back to what we talked about. Do you have the training? Do you have the chops? Have you put in your time? If you have done all that stuff right with 70% knowledge, you can then adjust on the fly as you are in that position. We talked about hiring in this show about you think you got a slam dunk and you do not. Everything in life is a leap of faith. You have got to do it at a certain percentage and you have to be able to let it rip. Procrastination or lack of being able to make a decision comes in later. You are crippling yourself because you can never be 100% certain.
Frank, your entire business model, you are in the real estate speculation business. Anyone in real estate is in the speculation business, whether they want to admit it or not. You are speculating 100%. If you are acquiring assets that appreciate or depreciate, you are speculating. Talk a little bit about how the 40/70 rule would apply to your day-to-day decisions on acquisitions.
For those of you who are involved in this space, you will know this. For those of you that are not, which is probably a vast majority of the audience, I do what they do on TV. We buy an existing house and we fix it up and sell it. Our exits are a little bit different than what they show you on TV. If you are going to boil it down, we buy an existing asset and then we repurpose it for sale. To Ian’s point, when I buy a house, I do not understand everything. I do not know what’s behind all the walls and what’s buried in the yard. There are always surprises. If I needed to make sure I knew every element, I would never buy a house because I can’t know every element. It is part of the deal.
What you have to come up with is you have to look at, “What can I be certain about? What am I uncertain about? What are the elements I can control? What are the elements I can’t control?” When I was in the very beginning of my business, a bad deal could bankrupt me. We have got 300-plus houses and I have 50 under construction right now. I run into bad deals every fifteen minutes. Something was not what we thought, but we now have the bandwidth that we can handle it in ways that we were not able to handle before. I am probably less risk-averse now than I was in the beginning because I have a better team, I’m more creative, and we have different exits that we can take that we couldn’t take in the past.
You are better at evaluating, so you do not take the same risk because you have a team that is good at digging into the details that have cost you money in the past.
As an example of that, I no longer buy houses that were built prior to 1930 that are wood-frame. I won’t buy it. I have lost my ass on enough of those that I know that I can’t. They are going to be riddled with termites. If it was built sub-1930, but it is a brick frame and has a four-sided brick house, I will buy it.
How many of those houses did you have to buy before that became a rule?
More than a dozen.
It wasn’t like the first one you were like, “Damn it.” You probably did not even notice. You were like, “Termites, this sucks. This was a loser.” You buy another, and you buy another. At some point, you start doing the math of, “When were all these built?” All of a sudden, that is a rule.
One of the things you have to realize is success leaves clues. When you start to realize this, you are like, “This one had termites. This one had water damage. This one has a rotten floor. This one has a piling that is no good.” You start to look at it and you are like, “All these are framed with wood.” In 100 years of history, something bad is going to happen to a piece of property, but if it is built of brick, less bad things can happen than if it is built of wood. What you have to look at is, what else in your life is the difference between built-in brick and built-in wood? Where are the things that are built in brick? Those are the things you invest in. If it was built in wood, I got to pass.
A house is such a good analogy. I’m glad you brought this up. I have had three interesting startup opportunities to invest in my life with people that I knew and I trusted. One of them was one of my best friends from college, who started a restaurant business and winery. It was an interesting concept. It was at a time when I had just moved to DC. I probably had enough where I could have invested in and got involved, but I was buying a house and some other things going on. Everything I knew was do not ever invest in restaurants. They are a bad margin. They go belly up. You will lose your money. The one thing I knew about this deal was the guy starting it was made from my kind of stock.
He is a hard worker. He is passionate, smart as hell, and absolutely outgoing. He is a great marketer with high energy. Long story short, I did not invest in it. Here we are, many years later, it is a $700 million business and I missed it. To me, that was a brick foundation. The foundation was the owner who was the startup, was the person starting it because it was just an idea. I made a different decision on a technology startup several years ago. I made 15 to 18 times my money on that investment.You need to understand where you are in your life when making decisions. Click To Tweet
I’m about to invest in another deal with the same owner because the foundation is brick. This startup owner, I know what he is made of and how smart he is. I know if I’m going to lose money, it is not going to be from integrity, a lack of hard work or focus, or because of someone’s pride getting in the way of asking for help. I know that is the kind of deal I would lose money on. I feel very good about the upside.
Even if you lose money on that deal, you are on the right side of it. Nothing is certain, but you are on the right side of the investment. You have got the right person, the right concept, and the right period in time, all green shoots. If you are looking at 40/70, you are over 70%. That is when you let it rip.
I’m not even close to 100%. It is still a tech startup. It is hardware and software. It is a new product. There are patents. There are so many question marks unanswered right now going into this startup. I’m going to be excited as hell to go back and look at this show with you in ten years and see, “Did I get crushed on that or did we kill it?” Right now, I can tell you in the pit of my stomach, I’m nervous. It is a big investment that I’m throwing into this thing. I’m diving in as an equity partner.
Your two questions are great. What can I be certain of? What could I not be certain of? I have done enough homework where I’m well over 70% that if I lose money, I’m not going to go back and say, “You miss some really obvious stuff.” It is just going to be the market was not as excited as we thought, or we just did not execute right.
This is going to get slightly off-topic, but I think it is worth bringing up here for this reason. You also need to understand where you are in your life when you are making these decisions. The restaurant you missed out on, you are 15 to 20 years younger. You did not have the money and the security. You weren’t in the same place. It is like, “I shouldn’t take this chance,” but now things are different.
You are like, “I can take this chance.” It comes from two things. It comes from, number one, where you are in life and your level of savings. It also comes from sharpening your skills and honing your craft. Ice Cube could make that album because he was a bad-ass and he was ready. You can make this decision because you have made a lot of other decisions. You haven’t made this decision, but you have made a lot of other decisions.
It gets easier to put out the final product. It gets better to say, “Done is the new perfect, because I have done enough of this where I know it is quality. I know I’m making a good decision. Is it going to work? I do not know, but it is a good decision.” It gets easier if you have progressed properly. If you have done this right as a 25-year-old versus a 45-year-old, you should have more angst at 25. You do not have the experience, the net worth, or any of that, but if you have paid attention at 45, successes lead to clues, and you are like, “This is good.” You might have missed it before, but now you do not have to miss it.
You do acquire properties for a living, but you had to acquire your first resi properties at some point. Cava had to go out and buy its first deals and try to make its first deals. I bet before you did that, you probably looked at a lot first and dragged your feet on some where finally, you had to say, “Either I have a business or I do not have a business, but I can’t keep looking at deals.” You do not have a business until you take some risk.
To be completely honest with you, buying a house was easy for me because I had done that a bunch of times at NVR, but the first time I ever assigned a house, I was scared to death. I ended up making $2,700 and I was positive. Every time there was a siren in the background, I thought they were coming for me. I knew I was going to get arrested. I had done $1 billion worth of real estate. This little $2,700 deal was going to fucking cripple me. I was going to jail for the rest of my life and be in stripes. I was scared but what happened was, I said, “I am scared, but I have the fundamentals. I know what I’m doing.”
I couldn’t afford an attorney back then, so I read everything myself. I’m like, “I do not think I’m doing anything illegal. Everything I’m being told, this works. I got to let it rip.” Do you know what happened? I did the deal. Now, we are going to do over $400,000 of that kind of deal. Had I not done that first deal for $2,700 when I couldn’t sleep for a week because I knew I was going to jail, I never would have gotten here. You got to take those steps.
When I left NVR, the first thing I was focused on was acquiring commercial real estate. I knew the exact product I wanted. I wanted to be in industrial. I wanted one tenant and something that was triple net and had a 10 to 15-year lease on it. I’d probably looked at 150 to 200 of those deals. Realtors are calling me all over. I will call them all to get on these lists and to get off lists. People call me all the time. I kept saying no. I was saying no to some good deals.
At some point, I had to tell myself, “No one is going to call you anymore if you won’t do it. You are either doing this or you are not doing it, but you are not going to learn and you are not going to find the perfect deal because if it was a perfect deal, why would you know about it? Someone else already did it. There is going to be some hair on something you do. If you do not take the risk, you are never going to be in this deal.” That is how I’m going to have to learn. I had to close the deal. Once I closed a deal, I relaxed on the next one. It wasn’t as scary.
I remember you in that process of buying that first deal. You were driving through Richmond to get down there because it is in Georgia. You are like, “Maybe I will stop or we will talk.” I was hoping to get in the car with you so we could both drive down and have a couple of days together and just talk about deals. I remember where I was. You were asking me questions like, “What do you consider? I thought about this. What are the risks?” I was in a house that we were flipping. I sat on a stoop. It was a nice fall day. I remember talking to you for a while. It was the same thing I felt when I first started. They were exactly the same, but we both took that step because we had done enough research.
We had enough of the answers. We were way closer to 70% than we were to 40%. What all of this boils down to is self-belief, like, “Am I making a good decision? Can I do it?” When you do a deal on your own, you have got to believe in yourself. Ice Cube knew when he got in the studio, shit was going to happen. That comes down to personal belief. You are going to invest in this restaurant and this tech startup. You can control a little bit of it, but some of it is, does that person have that self-belief? Do they know they got the goods? That is part of the calculus that you have to look at. It comes down in a lot of instances. Your self-confidence or the self-confidence of the person who you are betting on, can they do it?
Frank and I did a very interesting and creative deal together at the end of 2019. It is probably worth unwrapping that from both of our perspectives because we are way out there on risk, multiple fronts, and what we had to do. We certainly did not have enough time to vet it to 100%, but I think we got to 70%. It certainly wasn’t below 40%. It would meet Powell’s 40/70. Frank, talk about how that deal started and why you had to bring me in at the end of 2019 in the first place.
We buy real estate and we repurpose it. We bought a 30-unit package at the beginning of 2018. It got written up in the local business paper. Someone who owned a bunch of units, which ultimately became 75, called us. They brought us this deal and my team analyzed it. We analyzed it for nine months. If we did not analyze it for nine months because we couldn’t come up with a decision, we had to get to the right number. We got them all the way down to a number that really made sense. I looked at it with my team and we were like, “The way that we need to do this is we need some capital. We are going to get complicated here on banking terms, but instead of debt, we also need an equity partner. The equity partner gives us money in the bank that gives us the liquidity to do the deal.”When you do a deal on your own, you have to believe in yourself. Click To Tweet
I thought about this deal and Ian’s deals with his service and collision centers and I was like, “He is the right guy for this. He would comprehend it. He would know it. Ian writes for Forbes. He is good at summarizing things, so I knew that he could put together something that I couldn’t in how to build this deal.” We had worked on it for about nine months. Ian knew that I am a strong operator who works hard and has a lot of integrity, the same things he said about the tech startup. In probably four hours of conversation, maybe less, you felt comfortable enough to pitch this. I will stop there and I will ask you, where do you want to pick it up from here?
Where it came down to is Frank needed to talk to me because it was a very large deal and Frank had multiple large deals going on at the same time. You had multiple tranches of projects that you were working on. This was a whale that was in the middle of a lot of other whales that you had going on. This was a very good year for Frank. To make it work with the debt, he needed private capital, which I couldn’t provide all of it. We needed to raise some capital. He needed an operator to step back from. It is the way this deal works. There were 75 properties and Frank felt relatively assured that he could give a great return to investors. My role was to go out and raise some money, either doing as much of it with myself as I could or raising money.
For me, not only did I need to be comfortable with Frank, that was an easy one. I have invested with Frank before. I needed to be comfortable enough with Frank’s deal to call my friends and ask them for money. It was a little bit of a difficult decision for me just because I had to answer to myself, “Was the return worth it for me to stress out about making other friends?” You start to get into derivatives farther from it. To me, it comes right back to what Frank said, the foundation was good. It was a brick foundation. I believe in Frank’s company. I know his company is strong. I believe in Frank’s integrity. I know Frank wouldn’t call me out of greed just to make some money, knowing that he could lose me a bunch of money and he’d keep it.
I knew that no matter what would happen, Frank would try to find every avenue he could to make it work. My decision was to go call a bunch of my friends and ask for money, raise money, put my name on an LLC as a manager, and work with Frank on it, knowing that I would lean on his people to do all of it the work. For both of us, it was very much a 40/70-type of a deal, but closer to the 70%. Looking back on it, there are 75 houses. Frank vetted them as best he could. Some of the deals, we have absolutely killed our pro forma on. We thought we would get 30% and we are making 60% to 70%. Some of them doubled. Some of them, we have gotten killed. You and I were going back and forth.
I’m like, “Why is not the projected return higher?” You are like, “Honestly, we took a bath on a few of these. I did not see them as bad as they could be,” but that is where I think quantity trumps quality in most things. If he had asked me to get involved in one house and that house had termites or was a problem, we’d lost. We’d had all our eggs in one basket, but with 75 houses, you will win some and you will lose some. The quantity is what has helped us on this, Frank, but from my decision perspective, just like yours, I had enough information that the foundation of the investment was solid, that it made a lot of sense for me to get involved and to also get others involved that I respected and trusted.
I do not know if you remember this, but we were doing a pitch video for the people we ultimately took this to during this deal. Done is the new perfect. This was the pitch. I believe in the operator, the market, and the deals. Not only do I believe in those deals, but this is also an area where these people are incredibly proficient. It is Richmond, where I live. It is the type of assets we own. I own stuff on the same streets already. When you are looking at it, you are saying, “Do I want to let this control me forever or not?” Those were some of the decisions like, “Here it is in a box on why.”
As I was talking to investors, this was a big deal. This was a $5.5 million worth of homes. We are looking for an exit of close to $9 million. This was a big risk. This was a stressful situation. I did not just say I believe in Frank because it is 75 deals. Frank is good. Frank is not good enough to do all of it himself because you have 75 tenants. You have to collect rent. If someone quits paying rent, you have to get them out and find a new tenant. You have to work with permits and the city. What I believed in and knowing Frank well enough, Frank has a good team.
If Frank would have said, “I’m going to do all this myself. I won’t let you down,” I would have been hesitant, Frank, if you had said that. I’m going to keep this separate from my company, but I know he has Eddie and Cindy. I know he has a property management arm. I knew the people you would have in the middle, technically, on this deal. That made me feel comfortable that you had the capacity to take on something that big. I sold that to the people as I raised the money. That deal is going to do very well for everyone who has been involved in it.
Along the way, we have had to adjust, course correct, and change things, then COVID happens. We can’t collect rent and evict people, but we have got enough leeway. This is something I think is really critical to talk about right here as we are wrapping this thing up. Novices fall in love with the deal. The reason you fall in love with the deal is because you do not have other deals. The difference between a novice and a pro, a pro knows more deals are coming around the corner.
I know I can say no to something because I know I can generate leads. That makes me more discretionary. We do 300 to 400 deals a year, but I say no to so much. I have seen so many things. I can say, “I do not need to procrastinate. I can go because of all of these things.” I can also say, “I can pass because another thing is coming around the corner.”
We are leaning on real estate, but I think all decisions out of creativity come down to this. I’m a writer. I enjoy writing. The first article I ever wrote after I signed a contract for Forbes, I probably have 25 hours into that, which is hilarious. For people that do not write, that is absolutely obnoxious. It is a 3,000-word article. It is not the length of it. I edited that thing 40 times because I was so scared to write on Forbes. They let you publish it yourself. There is no editor. I knew that when I hit this little button that says publish, Ian Mathews was going to have an article on the Forbes website. If it was bad grammatically, I have this thick grammar book that they give you. I was checking every sentence. Now I have written 50 articles for Forbes.
I can bang one out in a couple of hours. I can write them much faster. I do not edit them as much. I’m still careful. Frank, when I started writing a newsletter, I had an email list. I take it seriously. If someone gives me their email, that is a personal thing to do to give someone your email. That means you expect the content to be good. When I first started sharing my daily writing with my email list, I spent hours on each article every day. It needs to be perfect and great. They trusted me. I do not want to bother someone with an email if it is not this light bulb invoking a moment that will change their lives. Now I write every day. I probably spend 10 to 15 minutes on it.
Half of the things I send to my newsletter, I type on my iPhone. I do not send crap. I do not think so, at least. I still write good stuff, but the more I write, the more the quantity is, the less I procrastinate, and the less perfectionist tendencies I have because if I write a turd, I’m going to write again tomorrow. Maybe they will like tomorrow’s and will not like everything I write. The more I write, the more I can experiment, the more I can try something new, the more I can screw around and use a song lyric, use a movie or do an interview with someone. Whereas if I’m only writing once a month, the pressure on that has to be so perfect.
That comes down to anything you want to be good at creatively. Do more of it. My son is less stressed about every at-bat because he plays on two teams and he plays five games a week. He has hundreds of play appearances a year. Whereas he used to play one game a week and it was the World Series game seven every time. The first time he struck out, he was in tears because, “I’m not going to get another play appearance for a week.” Now it is like, “Another at-bat.” He is like a Major Leaguer that strikes out.
Volume gives you the ability to hasten this curve quickly. What Ian and I want you to take away from this is this. What is Nike? They make shoes and apparel. It wasn’t a shoes and apparel company when it started. They could have over-thought that name. They might not have a name. They became that name. It is like a logo. You can do your logo 300 times, but it does not matter. What matters is, is it out there? Is it done? Once it is out there and it is done, this is what gets to happen.
You get feedback. “Did people buy the album or did they not buy the album? Do people like it? Let me give them more of that.” You can overthink everything and you can overproduce it. Chinese Democracy took twenty years. Most of the good songs on Appetite for Destruction took twenty minutes. We are talking about Appetite Destruction a hell of a lot more than Chinese Democracy because they had their craft and they put it out there, and then the world consumed it.To anything you want to be good at creatively, do more of it. Click To Tweet
Chinese Democracy would probably still suck if they had done it in three months, but they wouldn’t have gone through two decades of stressing, worrying, and fighting.
They would have 17 or 18 more years to put out something else besides that.
They could have got that feedback right away and been like, “What did not they like about it? Let’s go iterate again.” They wasted all those years. If you are going to flop, flop fast and go learn from it. Let the market tell you whether you are right or not. Do not sit and guess for years worrying about it.
If you are investing other people’s money, you need to make sure you have got a pretty high stick rate. If you are going into an operation in Iraq, you need to make sure you got a pretty high chance of succeeding. If you are putting out an article or a song, life or death is not there, you can then turn this into your audience, but you have got to be serious and committed to your outcome.
If your outcome is to be like Ian, someone who’s giving opinions about business, growth, and management, he can course correct. For me, the 75-unit deal, we knew that there was going to be ups and downs, but overall, it was a good body of work. You have to understand where can you be cavalier and where can you not? The goal of this entire show is do not cripple yourself with fear and procrastination. We can do nothing.
The way I’m going to wrap this, Frank, and it is a good lead-in, this show is a very good example of everything that we are talking about. Frank and I could have gone out and hired camera crews and perfect lighting. We could be in a studio only when we do this to make it appear like we are Joe Rogan. We are not. We are a couple of guys that have some decent ideas that we want to share. Frank has his microphone sitting on two architecture books just to get it close enough to his mouth right now. Our lighting is not perfect. If you look at our background, we have a half piece of art. Anyone who does a podcast would probably poke holes all over this thing.
Both of us said, “Let’s have fun. Our goal is not to make money. Our goal is to put some things out. Let’s test it. Maybe they do. Maybe they do not. Maybe in five years, we look back at these first ones where we are using free Zoom software to put it together and my guys, Tanitia, over in Bosnia is editing these things for $100 a pop. We will look back at it and say, “That is pretty wild how low budget we were in the beginning.”
It might still be the same, but nothing is changing about our content. If we do not put it out, we won’t know whether it was worth doing it, and we are having a blast doing it. This show is a perfect example of done is the new perfect. We pay attention and prepare for these things, but we are not over-preparing to where we will never produce a freaking show. That is a great wrap-up, Frank. Thank you very much. You are not the best color man in the business for nothing.