EP 184: Randy Smith and Pascal Wagner - Don't start passive investing with an advanced strategy

[00:00:00] Hello and thank you for joining us today on The Gentle Art of Crushing It show where we focus on learning and sharing with our listeners all there is to know about how to create success in our lives.

[00:00:12] This show stands on the shoulders of giants. Our mission is to empower and inspire our listeners to create the life of their dreams whilst having a blast in the process. Let's celebrate life together. Welcome to the show.

[00:00:29] Welcome back to The Gentle Art of Crushing It podcast. My name is Randy Smith and I'm your host today.

[00:00:35] I am really excited to be chatting with a friend, Pascal Wagner. Pascal and I met through a mastermind that we're both a part of and I've just grown to really like the guy over the last six to nine months or so.

[00:00:47] Pascal is the founder and CEO of Grow Your Cash Flow. He has deployed over $150 million from a prior employer and he is currently earning over $265,000 a year as a passive investor in investments. So Pascal, welcome to the show. Glad you're here.

[00:01:10] Thanks, Randy. I'm really excited to dive in and have some fun with you here today. Outstanding. Well, let's jump in. Like tell us a little bit about yourself, some background. How did you go from where you were to where you are today?

[00:01:25] Yeah, cool. I love it. So, you know, I think it's important to start my story with back in 2019.

[00:01:35] I started working as a fund manager at a company called Techstars, which is an early stage venture capital firm where we would just make investments. We'd usually be one of the first checks in companies giving them 100 to $300,000.

[00:01:52] I, you know, I'd previously sold a company back in 2019. That was my last venture back to start up to a national photography firm reached out to one of the investors that was on my cap table or that was an investor in the company and said, hey, you know, I'd love to work in venture capital.

[00:02:11] Do you have a spot for me? So they ended up making up a spot. They made up a role that they couldn't hire for for the previous year and they brought me in. And, and that's how my, my journey and kind of big money investing started.

[00:02:28] Are you interested in real estate investing but don't know where to get started or think you don't have the time or money? Are you stuck in your W2 because the golden handcuffs make it hard to walk away?

[00:02:38] If this sounds like you, check out impact equity.net and schedule some time to talk with the founder, Randy Smith. Randy went from massive income to leaving his W2 through passive income and he can help you do the same. www.impactequity.net

[00:03:08] Yeah, I mean, so, so the way tech stars works is it's if you're familiar with Y Combinator or 500 startups they're all accelerator programs where the idea is, you know, tons of companies from all around the world are submitting applications.

[00:03:23] It's actually harder to get into tech stars than it is to get into Harvard. There was like a 0.3% acceptance rate of companies who applied to people who get money.

[00:03:33] And, you know, there's 15,000 that apply and that gets whittled down to, you know, a couple hundred that we invested. And those companies then have, we give them $120,000 and they would get into our program for three months and they would get mentorship and coaching and we teach them how to run their company and

[00:03:54] we teach them how to frame their offering and pitch investors and get feedback and ultimately, you know, the big deal that tech stars has is 60% of companies go on to go raise over a million dollars within a year after graduating the program.

[00:04:15] So it's a big accelerator to help companies grow. So now were you part of the group that's choosing which ones move forward or the due diligence or what was your role in that?

[00:04:26] Yeah, so specifically, so I did a lot of that what you're talking about. So, but specifically my role was on the investment team where we focused on managing the follow-on fund.

[00:04:42] So if you think about the world of venture capital, you know, the first check-in is what tech stars did. These are like pre-seed checks to get the company, you know, enough capital to get to their next milestone to where they have some like real revenue that they can go raise from.

[00:04:59] And, you know, how it would happen is there are a lot of these managing directors that would put together screening committees, you know, where we would sit in a room with 10 people and we would, the companies, the top 30 companies would pitch and we would talk about what were the pros and cons of each investment.

[00:05:17] How did we like the team? Like, how big do we think the market is?

[00:05:21] Sure. And so I would help with those and then my role was to then figure out of all of the, you know, 2500 plus companies that exist within the tech stars portfolio, which ones should we double down on and make those investments into. So that was my specific role.

[00:05:39] Got it. Got it. Okay. Yeah, very, very interesting. What a neat role that's really kind of set you up for what you're doing today, obviously, with your own personal investments and fund management too.

[00:05:49] So, interesting. Okay, so you spent, you spent a handful of years at tech stars and got just great experience. And I'm guessing at some point you start looking into investing passively yourself. Otherwise, otherwise we likely wouldn't be here today. So tell me about that a little bit. Yeah.

[00:06:06] Yeah, so look, I think at the time I was working at a full-time job at tech stars being a fund manager and you know I'd also built up a small real estate portfolio. I've been doing co-living where I buy single family homes and I rent them by the room.

[00:06:23] And I have 12 of those now in Atlanta. So that's kind of my active portfolio of real estate that I quote unquote manage or own.

[00:06:32] Sure. And you know, I took on investors to fund buying some of those homes. So that was kind of like my first foray into you know raising money for real estate projects.

[00:06:45] I'd previously raised over $2 million for my last venture backed startup and you know had experience raising money and being a steward of capital.

[00:06:53] And then in 2019 I took on $200,000 of investor capital to go buy some additional real estate. And really what happened was you know I had this friend his name was Mike Klein who is an incredible crypto expert and now fund manager who we would hang out regularly

[00:07:18] and he would be the person that's buying when markets are low. He was constantly telling me about different way like where I should be placing my money and you know I'm sitting there without you know managing both a full-time job and you know this active real estate portfolio and wanting to be involved in

[00:07:38] you know figuring out where to invest my money in crypto. And you know after you know maybe like two years of just watching how much better Mike was able to have his portfolio grow than myself.

[00:07:53] That's when I started having someone else manage money on my behalf. So that was kind of like the spark right it was the you know it wasn't officially investing in a fund but it was it was investing with other people and having to manage it.

[00:08:10] I'd done that as well with hard money loans before you know I take some money and I give that to someone and then they pay me interest payments and give it back. And I would say then the real you know I continue investing like that where Mike was managing my crypto money and I was managing

[00:08:28] my job and my co-living portfolio but then in 2021 everything changed. My dad passed away from old age RIP dad but you know at that point I became the money manager of the family.

[00:08:50] My mom you know my dad managed all the finances for the family and my mom really today still doesn't know how to you know where to place money or you know how much is she spending and how much is she bringing in. She doesn't really know any of that because my dad handled it so all of a sudden you know in April of 2021 I now was tasked with like helping my mom find a new place to live

[00:09:16] and you know on top of working this job and having my co-living portfolio and the first thing that I did was I needed to figure out how to provide her an income. And so I took the part of the inheritance that my dad had left her and putting it into things that I knew personally would generate cash flow.

[00:09:42] And so for me that was investing it in single family homes rented. Sure. Sure. Okay. And after about a year I had gotten to 12 homes and generating like $40,000 a month and I started to realize how incredibly risky it would be to keep putting more and more money into that.

[00:10:07] And you know if anything goes sideways this is my mom's you know life for retirement on the line everything. Yeah. And then that's when I realized like I need to go diversify this and put it with someone else and having had those experiences where I worked with Mike and managing my money and working with hard money lenders and you know I needed a way to invest the money without money.

[00:10:37] And so I started to think about pulling my hair out and diversifying it. And you know after having you know months long of sessions with my coach of giving up the control of managing it.

[00:10:53] You know I was I was surrounded by people within go bonans. The mastermind group that we're both a part of where everyone there talks about investing for horizontal or passive income and they talk about the number of income streams that they have.

[00:11:11] And I think that really opened up my eyes and you would you would see some of these the elders in go bonans they would have 304050 different income streams from different projects and to have that kind of diversification when you're living off of the income.

[00:11:31] I've found has has been insanely important especially when you have ups and downs in the cycle so that's really how I got into to passive investing I was almost forced and just realize that I couldn't continue to do just this one asset class and that I needed to expand.

[00:11:51] It's such a great story and I think like your aha moment of one that diversification scare that you ran into with your mom's money like that's scary. If all of a sudden you wake up and you've got 100% exposure to any one of anything.

[00:12:09] Nothing is a sure bet no matter how good you are no matter how how great the market is going we've seen in recent years and months that that is not always a good thing to do so right.

[00:12:20] I think that was important. I think also you know your story about your friend Mike like what a great aha moment to realize that you know your superpower was probably focusing on something other than crypto and you identified an expert.

[00:12:37] So let's leverage his expertise and then you go leverage what your expertise is so you know those are two great lessons.

[00:12:45] So like it's crazy because I you know when I put two and two together I realized I was working out of fund like there are there are other wealthy investors who've given tech stars money to go manage and deploy that money on their behalf and then you know once once you have that lens and

[00:13:09] especially sitting there in the driver seat it's like who do you think is going to do a better job. You know the person that's doing this for the first time and they're trying to pick you know one or two startups that they think are going to be the ultimate success

[00:13:21] or tech stars who's looking at thousands of applications and has been doing this for over a decade and you know has a track record and they're you know and they have all those learnings over time and I think that's also when you look at the

[00:13:39] writing on the wall of how the really high net worth investors invest is they have their money deployed across all different types of fund managers there. They might have an active real estate portfolio but they are 100% diversified in in all of these different

[00:13:55] there's no way you can be an expert in all these different classes. No way but but I think you can become an expert at vetting operators and then sifting through those deals and we're going to get into that I know because that's really kind of your strength

[00:14:09] and Forte and superpower today but you have you have these all home moments and then all of a sudden you're forced with this this challenge of I've got to diversify this money so like how do you do that like how did you go out there and try to give your mom and then ultimately yourself diversification.

[00:14:27] Did you just start searching Google or hanging out with guys that were doing the same or what did that look like. Yeah so look I.

[00:14:36] One of the first problems that I had as an investor coming from the world of tech stars where my whole role was to you know that the tech stars follow on fund at tech stars didn't have deal flow if you think about it they they have 2500 companies in their

[00:14:58] within the tech stars network that have received money from tech stars but the follow on fund investment team had no insight into what companies were raising rounds within their own portfolio and so my job was to go out and figure out how to get that information

[00:15:19] and pull it in so that I knew which what opportunities were even available for us to invest in so taking that lens.

[00:15:28] I approached the same thing to pass investing but I had the same problem that anyone who gets into passive investing has which is how do I find deals or how do I get deal flow.

[00:15:41] I'm a huge advocate for when you in order to be a great investor you need to see a lot of deals. Yeah you know when I imagine you have this to where it's like you know when you first started if you only get a deal in your inbox every other month then you really look at it and you're

[00:16:06] like oh this could be good and like or you might be asking yourself how do I know if this is good and that's yeah but if you're looking at 10 deals a week you know then you're seeing 500 deals in a year and like you're very quickly going to know what's market what's not oh this person's charging way more fees than

[00:16:26] then 80% of all the other deals that I've seen so my first objective was to figure out how to build up my deal flow and that's that's how I started building this database of deals that you know all of the investors who subscribe on my list you know see it's

[00:16:46] I am signing up when I'm on Facebook I'm signing up for every single syndicate was email you know I am if someone's saying hey I've heard of this deal I'm like can you send it to me. Sure.

[00:17:00] I go to that operator and I say hey what other what other deals are you in.

[00:17:05] I'll go to other investors or these investor communities like we have within go bonance and I'm asking them, you know what deals are you invested into what what do you like what have you looked at it's it's really something where when you are in this space.

[00:17:21] And if you become an investor the number I think the first thing that you need to do is to raise your flag up in the air and say hey guys, I'm looking for deals if you have a deal I want to see it how have you seen that play out.

[00:17:38] Yeah, I'm kind of the same way like I when I first got started I was I was the podcast guy so I had listening to you know 10 hours of podcast today I don't know where I find found the time to do it.

[00:17:48] But then I would get on the phone with these guys to and at first I remember being a little star struck like gosh I'm talking to so and so who's on this podcast and then I get his deal and I think well this is the greatest deal I've ever seen until I got on the next one and saw the next one and as you said before you know it after you've looked at

[00:18:07] 100 different deals you start to see trends you start seeing things that are concerning and you start seeing you you also kind of start you start developing your own appetite as to the type of deals that you want because a good deal for you might not be a good deal for me.

[00:18:24] Because we all have different needs so I think I think that's a great point.

[00:18:28] I think there's also you know, all of these things take effort and I you know I talked to a lot of investors on the phone when they when they are interested in talking about potentially joining my fund.

[00:18:40] And, you know, a lot of them say like okay well how do I know what's a good deal or how much effort do I need to put in and it's like, okay well if you think about it you just you're about to take a huge lump sum of money, you know 50 hundred maybe more $1,000.

[00:18:57] And you're, you're trying to deploy that money into something where you could lose it all and you and there's there's this hesitation of like oh I don't have the time or I don't want to invest into into learning this skill.

[00:19:13] And I think I was there to you know as I think when you when you get into anything new it's like oh do I really have time do I do I really want to get into this but it's actually just a new skill that you need to develop and learn.

[00:19:30] And one other point to something that you mentioned was once you start getting on the phone more with a lot of these operators you also understand who you like to work with who's who's who's short on the phone or who will absolutely take the time and explain everything to you

[00:19:50] and so I was on an investor call for a fund last week and I asked where they got this information that they did what data source did they use for a bold claim they made and then the fund operator immediately told me hey man I don't think this investment's for you.

[00:20:09] It's like wow, you know you learn a lot by just talking to some of these people and learning about who do you want to invest with. Yeah, no I think I think that's a really good point.

[00:20:21] Personality is coming to play here and when you get to a point where you're starting to accumulate some wealth, you do get to pick and choose who who you want to be with you're not just an excel sheet or person on an excel sheet.

[00:20:34] You get to choose the personalities and and the quality of the people that you invest with and I think over time that probably starts to weigh more heavily.

[00:20:43] And you're potentially even willing to sacrifice some returns for that investor experience as well and I think it's important to also consider that you've got to be a good investor partner as well.

[00:20:59] So if you're the guy who asked 187 questions and then you place $25,000 and then you follow up six times a week on what's going on and how things are going. You might get more responses where you know they'd rather walk away than take your capital.

[00:21:14] So it's a balancing act early on no doubt. Yeah, I know I definitely resonate with that and I definitely think you can go overboard and and I think you know if you're a newer investor to this space. It is a shift that you need to make.

[00:21:32] You'd unlike stocks, you do have access to the fund managers and CEOs often when you're investing in these funds.

[00:21:41] But also, you know, it's not that you can email them every week and and ask them, you know, if they're a good operator, they will provide you updates on an ongoing basis and you can sit there and ask questions.

[00:21:57] But but to pepper over and over, it kind of means like you probably shouldn't have been placing your money in that fund. It was too much of your net worth for you to do that. What's your take on that? No, I think that's a great point.

[00:22:15] And I think you're you're kind of dancing around a topic that is, you know, how much dollars do you put and, you know, as a new investor coming in. Do you do you take if you've got 500 grand and investable capital?

[00:22:28] Like, do you put that in one, two, five, 20 different deals? What does that look like for you to have certain strategies that are guidelines that you follow? Yeah, I think there's the ideal approach. And then there's how I've played it out in practice. So two different things.

[00:22:47] I'm guessing different two different. Yeah, yeah. You know, I was just mentioning before this my my goal right now is to have less than 3% of my net worth with anyone fund operator because I think it's just a smart diversification play. Now, that is the goal.

[00:23:06] And I would say the way that I started because I had I had to deploy money very quickly and to have it kind of start generating yield, you know, to provide my mom some sort of income right so Sure.

[00:23:21] The way the way I went about doing it for better or for worse was I did a lot of heavy diligence and found, you know, the one or two funds that I felt incredibly safe with and I invested, you know, in bulk five, six, 800 K.

[00:23:39] And then over time, you know, as I would find more operators to place money with, I pulled that money and moved it and diversified it.

[00:23:49] You know, could could be, you know, some could see that as risky. I think it depends a lot on your situation and your goals and what you're trying to do. And for me, That just felt like the most appropriate path.

[00:24:03] And I think it's important to kind of highlight that point. You had to get the dollars deployed to create income and create or maintain lifestyle for your loved ones. Right.

[00:24:14] So very different than potentially the high income W2 person who is, you know, maybe they're getting annual bonuses or quarterly bonuses that they're deploying at some type of regular interval where you might have, you know, 90 days to 120 days to investigate your next investment.

[00:24:31] Now, you mentioned something that we've not gotten into a lot on this podcast and I'd like to dig into it because you mentioned deploying capital into funds and then moving it.

[00:24:44] And a lot of times when people think about syndications or they think about alternative investments, passive investments, there is this illiquidity issue that comes into play.

[00:24:54] So it sounds like you might be leveraging some different tools than even what this subset of the population understands around alternative investing. Can you talk about that a little bit?

[00:25:05] Yeah. So as I started getting into passive investing and thinking about, did I want to start a fund or help other people do this?

[00:25:16] I really started once I'd invested in these different debt funds such as the DLP capital ending fund that we're both big fans of, you know, I came up with this concept of beginner intermediate and advanced level funds or private investments.

[00:25:37] So I think where most people go wrong and where most people start, unfortunately, is in the advanced bucket. You know, when you're younger or if you don't really know anything about private investing, most people, you know, they hear about some startup or company opportunity,

[00:25:59] which you deploy money and you're probably not going to see your money back for at least 10 years if ever at all.

[00:26:08] So a lot of people, including myself have invested in startups in the advanced bucket before I had all this training at Techstars and being able to see tons of deal flow and then they get burned.

[00:26:23] And then they think, oh, you know what private investments? Not for me. Then I think you have this intermediate bucket, which is what I consider, you know, maybe a more cash flow focused approach where you're investing money that you can't pull out or you can't pull out for five to 10 years.

[00:26:48] But within two or three years, people will start to see some cash flow or some sort of return. And you know, if you're a newer investor, I think one of the big things that happen is you've decided you're going to make an investment.

[00:27:09] You wire the $50,000 and then you're sitting there three months later and you're asking yourself, okay, so when's the money going to flow in? Is this real? Have these people run away with my money?

[00:27:23] Like, you know, if you've never done it before, you don't know what to expect and it's really weird. And so, you know, people will invest as their first deal in these multifamily syndications.

[00:27:35] And look, there's nothing wrong with that. And if that's the route you want to go by all means. But when I think about my investment journey, I wish that people started with showing me what I now call beginner funds, which are these funds like the DLP Capital Ending Fund where they're more...

[00:27:55] You as an investor can invest in the deal and you get cash flow within the first one to three months. And you have the ability to pull your money out.

[00:28:09] So if it's your first time investing in a deal and something in private investments and you're ready to graduate, you've maybe tried Fundrise or Yield Street and you're ready to graduate.

[00:28:19] Then putting your money in a fund where you get to actually see, oh, what's the communication like on a monthly basis from this operator? Are the checks actually rolling in? Right.

[00:28:33] You know, and that's what I think has really helped me gain confidence in investing passively. And that's something, you know, I'm trying to educate or at least share with people that if you're going to get into the space, a way you can do that is by starting with beginner funds and then slowly graduating as you become more advanced and know how to do due diligence on different deals and operators.

[00:29:03] I love it. It's honestly, I wish I had met you about five years ago because I did exactly what you said. I jumped right into, I would say probably the higher intermediate where they...

[00:29:18] You know, there wasn't a lot of cash flow early on. Sure, I was getting something but not enough to live on or anything like that. And now that I'm thinking back, I remember when I joined GoBundance, the resounding message was cash flow, cash flow, cash flow.

[00:29:34] And I remember when I was in the W-2, I was making very good W-2 income. So I didn't really have... I didn't have a cash flow problem at all. In fact, I didn't even want it for tax reasons. I didn't want any additional income.

[00:29:50] But the second you get laid off from corporate America, all of a sudden you become a cash flow investor and if you've got all of your money tied up in these intermediate type of funds, all of a sudden you're in a situation.

[00:30:01] So I think it's such a good point to look at immediately cash flowing options that have a liquidity kind of aspect to them. And then as you get more comfortable with those, you can pull portions out and start moving into the intermediate space.

[00:30:18] But such a good point that really needs to be shared more and more, I think. Great stuff. Yeah. And to build off that point, it's like you don't really realize how illiquid the investment is until you need it. Exactly.

[00:30:36] Like in your case that you were talking about where you get laid off and you think like, oh, maybe I have a million dollars and I'm a wealthy person but you feel poor all of a sudden. Sure.

[00:30:51] You're going to have cash flow coming in and you need to figure out how to pay for your ongoing expenses somehow. Exactly. Exactly. Such a good point. Such a good point. Well, let's see here. We've got so much more I want to cover here.

[00:31:05] So let's talk about some specifics if we can. I know you're in all kinds of different asset classes, but can you share maybe a few that maybe the traditional multifamily investor maybe they haven't heard of and maybe why you chose those or pursued those? Yeah.

[00:31:25] So I think the way I would start is by saying I have a barbell investing approach. So I very much have a, I think when you make an investment there are three things that you can get out of that money.

[00:31:42] And I think that when you make an investment you need to understand what am I trying to get out of the money that I'm placing? Yeah. Cash flow. Am I trying to get equity growth, meaning like I want my money to grow as quickly as possible?

[00:32:00] Or do I want some sort of tax benefits from it? There are some investments that do just one. You know, if you invest in the stock market that's largely equity growth, you're trying to get your money to grow as quickly as possible.

[00:32:13] You could invest in these debt funds where you only get cash flow and they don't have any equity growth. And there you could invest in just for tax credits, right? Like you can make investments and just buy tax credits. And then there are investments that have all three.

[00:32:28] And so, you know, like real estate, like real estate you get some rent, you get some appreciation and you get depreciation with some tax benefits. And so I think it's important to figure out what you want out of your money.

[00:32:42] For me, I have two different buckets in this barbell approach. The one is I have money that's strictly focused on generating as much yield as possible that I can find safely. So my cash flow component. And then the other is this equity growth.

[00:32:59] I'm trying to get this money to grow as quickly as possible. And then I have a little bit in between. So, you know, in terms of equity growth, the things that I'm in are pretty much largely like Tesla stock on the equities market.

[00:33:13] And then I'm in a crypto fund called Crypto bull capital. That's managed by my client, the guy I mentioned earlier on this call that I'd learned to have way, way better returns than I did.

[00:33:24] And then in terms of on the front end, in terms of cash flow, you know, I'm in all different kinds of things. I've been in a business field with Grant Cardone in an apartment building 10 X here Miami. I've invested in reliance self storage fund.

[00:33:45] I've been in the ATM investment that generates, you know, it's kind of like a more business focused play. And I mean, you name it, I've been in commercial real estate deals. I'm in multiple different apartments, indications in Denver. So I've a large gamut of things.

[00:34:07] My focus has just been how do I invest with someone who has an incredible track record through a down cycle. Okay, so that is, that's amazing one that you've identified that so succinctly is to your strategy.

[00:34:21] Very rarely do I run into folks that have that type of detailed plan. So clearly you've been taking lessons in the community that we're a part of and learning, learning a lot there I suspect.

[00:34:33] Yeah, what, you know, I think I learned the concept of, I think what we're talking about here is an investment thesis from my role at Techstars. You know, when you have this big institutional $150 million fund, you need to have a strategy on how you're going to approach it.

[00:34:55] And then you're going to approach finding startups and then which ones you're investing in. And so I feel like that really helped build that muscle of, okay, what is my investment thesis for this money? Oh, I think crypto is going to be worth a lot in the future.

[00:35:12] I don't need this money right now. I think it's the, you know, the next financial system. And so that is my thesis. And then if I write that down years later, I can come back and say, was I right? You know, all of it's an experiment.

[00:35:30] You need to think of it like an experiment and you only learn if you know why you invested in the first place. Okay, that makes a ton of sense. So yeah, I like how you've kind of, you've given some names to the strategies.

[00:35:46] You've given some visuals, some analogies with those. I like the barbell piece. You mentioned something earlier, you know, this advanced intermediate and I'm not sure what the lower one is. Intermediate advanced funds, yeah. Exactly.

[00:36:02] Like so I like the structure that you're applying to this and it really gives kind of the new investor that's coming in.

[00:36:07] It gives them something to really attach to and associate and affiliate with so that can help to direct some of their, some of their decisioning that they're going through.

[00:36:17] So well, let's, if we can, let's, let's dig into what you're doing in the community today and your specific offering that you're solving one side of that dumbbell, that dumbbell very specifically.

[00:36:32] And let's talk about what you in your group are going to be doing for the next year to two years plus. I'd love to hear that.

[00:36:40] Yeah, so, you know, I think where I started is I realized that my dad, my dad had tried to invest in multiple different private investments and I learned that many of them did not pan out due to many of the things that were taught by me.

[00:37:01] I'm not talking about and learning here today. Okay. And I realized how hard it was for someone like my dad, who I thought was a great investor to do.

[00:37:16] And so, you know, then having have then having to do that for my mom and really do the due diligence and figure out, okay, how to rule number one, how do I not lose any money? And then how do I make it generate real cashflow?

[00:37:36] And that's not easy. Right. Like if you're not in this world, then what other options do you have today? Today, there are money markets that generate 5%, but that's not always the case and is actually just very new, right? And then probably won't stay forever.

[00:37:55] And then you have this, you could maybe invest in bonds. You could, you know, try and loan money out yourself, but you're not going to get anything at the bank. And you could maybe invest in dividend stocks or REITs, you know.

[00:38:08] And I didn't like the REIT approach because, you know, with volatility, the stock goes up and down. And I was struggling to find someone who focused on helping you diversify your cashflow sources and help them retire, right?

[00:38:31] And so I saw that need in the market and, you know, that I'm basically building the resources that I wish existed a couple of years ago.

[00:38:40] Our focus is I'm looking for cash flowing funds that distribute cashflow within 12 months from an investment and that have been through a down cycle in the exact strategy I am investing in. Those are kind of like my high level criteria.

[00:38:59] And when I think about some of the problems that I uncovered, you know, at the beginning, I think of myself as an investor first. You know, I am out here looking for deals and trying to scout them and I'm putting my own money into the deals.

[00:39:19] And I'm allowing people to invest alongside me in all of these cash flowing type funds. And so that's where my focus is and that's how I'm helping people.

[00:39:29] Okay. So now if an investor is intrigued with this beginning to intermediate stage and they wanted to connect with you to hear more about this, how would they find you? Yeah. So they can reach out to me either info.info at pascalwagner.com.

[00:39:48] They can go on to growyourcashlow.io and join our email list or follow me on LinkedIn. I'm pretty active on LinkedIn and you can follow along there and book a call directly from me there. And you've got a pretty unique newsletter that you do.

[00:40:04] I believe it's a weekly newsletter where you're sending out, I mean sometimes it's a dozen plus opportunities a week so they can find that information or sign up for that on your newsletters or on your website as well.

[00:40:15] Exactly. So when you join the email list, part of its education helping you learn a lot of these concepts that we're talking about here that I've learned along the way that I wish someone taught me. And to go along with that it's deal flow.

[00:40:30] So I'm out here, I'm looking for deals and I have a team, I have an assistant that kind of takes every single deal, plugs it into this database and you can sort it by asset class.

[00:40:42] Is it a fund or syndication? You can rank them by their returns and so you can get access to all of that. All of the deals that I find you can get access to if you join the list at growyourcashlow.io.

[00:40:55] What an amazing service too and it really goes back to kind of the first things we were talking about early on is if you have access to one deal, that deal's either going to look really good or it's going to look really bad and you don't have anything to compare it to.

[00:41:08] So this service gives you, I mean there's literally hundreds of deals in that database I believe.

[00:41:14] How do you go about finding deals? I mean I think what's fascinating is I have not, there are platforms like the Yield Street and the Fundrise and the Realty Mogul and the way I think about it is that if you're a passive investor you should be looking at all of these platforms.

[00:41:32] They're all part of your deal flow but outside of that and maybe clicking on some ads. I mean different fund manager groups and masterminds and that's how I collect a lot of my deals through my network. How do you do it?

[00:41:48] Well, and it's very similar. I raise my hand to read every opportunity I can get a new deal to come into my inbox. I want to take a look at it.

[00:41:56] It's not necessarily because I'm going to invest in it but I want to know what's going on in the marketplace but I spend 60 hours a week doing this stuff.

[00:42:04] This is not a couple of hours on a weekend so guys like you and I who see 50 to 100 deals a month, it just talks to the importance of an investor who connects with you that feels comfortable, has that personality thing that we discussed earlier

[00:42:22] and then really starting to become or starting to build a relationship with someone like you so they can start to trust your expertise and see the type of deals that you put in front of them. So I think, yeah.

[00:42:33] Yeah, I mean I think likewise right so so Rainey and I we both do a similar thing where we help people get access to these real estate deals that they could not have otherwise or by aggregating more capital they can get better you know splits or better returns than you and just investing yourself and I think part of you know if you're an investor listening to this call.

[00:42:57] The takeaway that I would want you to have from this conversation is that you should be finding the people or quote unquote the influencers that you resonate with that you you like their strategy you like the way that they think you know you maybe do do diligence here on Randy and you understand how he evaluates deals

[00:43:19] and what he goes through before he recommends a deal because then you can sit there and say hey I don't need to necessarily become an expert at looking at thousands of deals like Randy and I do every single week, but you can shortcut that by working with someone like Randy or myself

[00:43:41] and not to say that that's you know you shouldn't be doing your own diligence on those types of deals that we both present but it you know everyone's looking for the hack and I think that is the way to approach it.

[00:43:56] And I think having somebody like yourself or myself be just one piece of your individual due diligence is does it doesn't pass the Pascal Wegener check.

[00:44:07] And if it does, then it's something at least I want to take a look at right and I think I think that's really the value both you and I bring in it.

[00:44:14] It's neat to hear that we have so much in common with an alignment on the type of operators that we like so it just shows that the work we're doing is kind of leading to similar conclusions with a lot of the same operators that that we know like and trust as well so.

[00:44:30] Well, I feel like you know, I always keep trying to keep these 30 minutes to 40 minutes and inevitably here we are again.

[00:44:38] This has been a lot of fun Pascal I've enjoyed the time enjoyed the conversation I thought you've brought a ton of value to the group but I'm not going to let you go just yet because I have a few questions that I do like to wrap up with everybody.

[00:44:50] Okay, all right. So this is the easy one but you and I are both kind of whole life entrepreneurs and we are trying to live big lives in all facets of our lives so.

[00:45:03] Knowing that knowing that we're constant learners and educators I suspect that you're a reader and you try to find new ideas and techniques for books so are there some favorite books you'd care to share with us or something recently you've put on the bookshelf that that really caught your attention.

[00:45:22] Yeah, there are three books that come to mind. So I think if you are in the passive investing space there.

[00:45:33] There is the avoiding rookie errors as a left field investor by Steve so that one, you know just it goes through I think there's like 18 different errors or things that you should look out for and it kind of offers practical advice and insights into common pitfalls in investment.

[00:45:53] Great read, you know all from firsthand experience of Steve so and what he what he's learned along the way that that's the book I just finished last week and definitely recommend that. Okay, there's another one called the hands off investor by Brian Burke.

[00:46:11] Yeah, it should be many, many times many times on this show yes.

[00:46:15] Yeah, and then you know it's it's fascinating to see how Justin has codified this into a book but the lifestyle investor by Justin Donald really talks about this concept of stacking your investments over time and and I don't think he uses this verbiage but I call it the velocity of capital.

[00:46:42] Like if you're investing in a longer term deal and you can get most of your principal back early in the life cycle of that deal you can keep investing that principle and have it compound while you're still earning returns and have a position in your previous investments so great concept and definitely recommend that one too.

[00:47:01] Love it. Yeah, I know I'm a big Justin Donald fan and the first book you mentioned I had not heard of that so that is on my list now and I will go find it.

[00:47:12] Okay, now kind of kind of a fun one here. Do you have a recent bucket list item you checked off your list or one you're hoping to assume.

[00:47:21] Yes, so if you know anything about me. You'll know that I love anything to do with yachts, big yachts, small yachts.

[00:47:35] Anything in between so I'm a huge cruiser and I had there were eight of us that went on a week long cruise with Royal Caribbean for my birthday in October last year which was, you know, I just think there's something special about.

[00:47:55] I think cruises are like all inclusive resorts on the water. Sure. And you have everything taken care of for you. You don't need to think about where you're going to eat or what you're going to do and so it allows you to have really solid bonding time with the people that you spend it with.

[00:48:16] So that was recent. Where'd you go? Where did the cruise go?

[00:48:19] You know, I hate to say it but so we had there were three destinations. I think it was it was a Cosmow, Ponderis and somewhere in Mexico but to me it's not even about the destinations at least in the Caribbean because most of them are all the same.

[00:48:37] It's really just that you're on the water and you're hanging out with your friends. I love it. I love it. Very cool. Yeah. Any future ones? Yeah. Yeah, future ones include I really want to do running with the bowls in Pamplona, Spain. Oh yeah.

[00:48:55] And that's been on my bucket list for a while. I as a German, I still haven't been to Oktoberfest so I'm that's big on my list and then the third thing is the zero G experience which is like this plane on 787 that again.

[00:49:14] It gives you the experience of weightlessness. Yeah, who is that? I was just listening to a podcast that he was talking about that and he brought up.

[00:49:23] Oh, the gentleman in gosh, I can't remember the guy's name, the old Superman. He brought him up to do that. Yeah, that sounds amazing though. You actually have I think it's like 40 seconds where you're completely weightlessness. Yeah.

[00:49:37] Yeah, I've had friends that have been on it and that are actually scientists and have run experiments on it. And so they've told me a time and it's definitely on my list.

[00:49:48] Short of going to space. Yeah, you know, you talk to go bundled skies about bucket list items and you always hear something cool. So yeah, it's yeah, that is a lot of fun Pascal.

[00:49:59] And I think you and I are going to hang out more in the future. No doubt. So very cool. All right.

[00:50:04] And then this is a new question that I've just asked. So we're catching you off guard here, but if you if you were given 100 grand today and you had to place it and you couldn't put it in one of your own deals. Where would you place that capital?

[00:50:18] So this is the question where I would go back to what I said earlier in the episode is like you need to understand what is it that you're trying to do with the money. Right.

[00:50:29] So I think on the equity side, if I was trying to just grow it, you know, as quickly as possible, I would definitely stick it in the the Crypto capital fund. Okay. If if it was a tax play, I'd probably do something like the ATM investment.

[00:50:49] And if it was a strict cash flow play. Yeah, I mean, the DLP fund is, I would, I'd probably stick it in some sort of of high yielding debt fund. Yeah.

[00:51:08] All right. Well, I happen to know a couple of guys that do just that. So yeah. Yeah. Absolutely. Well, very good. Pascal. This has been just a ton of fun and it's neat to kind of compare notes with somebody that's doing something similar to me.

[00:51:22] And I feel like I learned a ton. So I'm sure the audience did as well. But yeah, thanks so much for being on the show and any any final comments you'd care to share with the audience before we wrap up.

[00:51:33] Yeah, no, I just appreciate you having me on Randy. This has been a ton of fun and for all the those that don't know, I've actually been talking to Randy quite a bit and I view Randy as a mentor for myself. So I'm just, I'm happy to have had this opportunity to connect with Randy.

[00:51:47] And again, if you'd just like to learn more about me and enjoy my email list, you can just go to grow your cashflow.io and we can start a conversation there. Awesome.

[00:51:58] Well, very good. And to the audience as always, thank you so much for joining today. It's it's been a fun experience today. We've all learned a lot.

[00:52:07] Our advice as always is continue that education process, but more importantly than the education make the decision to invest in that first passive investment deal.

[00:52:18] Both Pascal and I are convinced once you do, you'll just wish you had started much, much sooner. And you'll be one step closer to decreasing your dependence on your W2. So join us again next Thursday for another great episode. And thank you again for joining us today.

[00:52:48] And please just know that we only ask for one favor, and that is to make this life magnificent. Thank you and have a wonderful day.