BiggerPockets Business Podcast 105: The MOST Profitable Skill to Learn (From a $200M+ VC Investor) with Codie Sanchez

BiggerPockets Business Podcast 105: The MOST Profitable Skill to Learn (From a $200M+ VC Investor) with Codie Sanchez

50 min read
The BiggerPockets Business Podcast Read More

Join BiggerPockets (for free!) and get access to real estate investing tips, market updates, and exclusive email content.

Sign in Already a member?

Successful business owners are addicted to building businesses, sometimes to their folly. For someone like Codie Sanchez, this isn’t a problem, but a superpower. Codie is a journalist, a venture capital partner, an angel investor, and an entrepreneur. She loves, as she puts it, “building herself out of a job”, which means creating businesses with huge potential, getting a team in place, and heading on to better things.

Now, managing many millions of dollars, she has to look into which businesses are worth capital investments. Codie often advises business owners to act out of confidence, not fear, and consistently hire people that are better at their jobs than them. She places a very high value on having employees and workers who are competent and can help the team grow (as any smart business owner should).

Codie mentions the most profitable skill of today and how she’s using that specific skill to grow her newsletter, Contrarian Thinking. She argues that in today’s society, the top level of hierarchies for time freedom and ideological freedom is financial freedom. If you can decide what you do, where you do it from, what you can and can’t say, and how to live your life, you have the ultimate freedom available.

This episode delves not only into the life of a VC, but how small businesses can keep their loyal customers, grow their audiences, and repel those who aren’t a good fit for them. Regardless of the size of business you have, Codie presents great arguments for everyone about developing yourself, your business, and your mindset.

Click here to listen on Apple Podcast.

Listen to the Podcast Here

Read the Transcript Here

J:
Welcome to the BiggerPockets Business Podcast show 105.

Codie:
I’m no genius. I am just as likely to make mistakes as anybody else. Once I realized that I was like, “Okay, what is the path of least resistance with highest ROI?” What I’ve found over the years is those are usually businesses that people don’t think are sexy.

J:
Welcome to a real world MBA from the school of hard knocks, where entrepreneurs reveal, what it really takes to make it. Whether you’re already in business or you’re on your way there, this show is for you. This is BiggerPockets Business.

J:
Hey, there everybody, I am J. Scott. I’m your co-host for the BiggerPockets Business Podcast. I am here once again, like every other amazing week with my amazing wife, and co-host Mrs. Carol Scott. Carol, I think you have something to say today, don’t you?

Carol:
Oh my goodness, what a bitter sweet day, right? We have had so much fun for the past 100 episodes, over the past two years doing this show. It’s our last one for a while, and we want to take a minute to thank so many people. All of our behind the scenes people, our editors, our producers, everybody at BP, Scott and the whole rest of the crew, and especially you our amazing listeners, our wonderful community. You have tuned in week after week. You’ve sent us feedback. You’ve given us ideas.

Carol:
You’ve poured so much love into our world and we are so, so grateful for each and every one of you. Thank you to everybody who has made this show, this journey so much fun and we hope you stay tuned for more great stuff that’s in the work, so thank you, thank you, thank you from the bottom of our hearts.

J:
Yeah, absolutely. It is bittersweet, and this is our last episode of the business podcast, at least for a little while, but we do have some fun stuff in the works. Carol and I are, we’re not going anywhere. You’re going to see plenty of us, whether it be back here or somewhere else in the very near future. I am thrilled to say that we are going out on a super high note on this episode. We have an amazing, amazing show today. We have somebody who, we had to jump through hoops to record this episode as our last one and it was well worth it.

J:
Our guest today, her name is Codie Sanchez and she has a tremendously diverse background. She is a former journalist. She is a mutual fund manager, MBA, PhD. I even mentioned that I should be calling her Dr. Codie Sanchez. She has done private equity. She’s done angel investing. She’s bought and sold small businesses and she’s a VC. Just an amazing woman who has done so many amazing things over the years, and she’s here today to basically help us get started.

J:
For anybody out there who is struggling to figure out how I get from step zero, step one, square one to becoming financially free, this is the episode for you. We talk about everything from why is financial freedom the most important thing, and how do we start down the path? What are the specific steps that we should be taking to eventually achieve financial freedom? Codie mentions throughout the episode, I guess she mentions towards the end that there’s no reason why this should take anybody more than six to 12 months, to really gain traction and start building that financial freedom.

J:
We talk about the path that we take, and one of the steps on that path is buying and building businesses. We’ve talked a lot about that on this show over the last two years, should we buy businesses? Should we build businesses? Codie has a very unique take. From her perspective, we should be doing both buying and building, but we should be focusing on specific types of businesses to buy and very different types of businesses to build. Make sure you listen to the distinction there, and start thinking about what businesses you should be buying today and what businesses you should be building today.

J:
Then we talk about how we take those businesses that we’re either buying or building and how we put them on autopilot, how we build them up to the point where we can hand them off to somebody else, make them self sufficient and then take our time and devote it to whatever the next project is. Then Codie tells us what the number one thing we should be focused on today, if we want to be building our brand, if we want to be building a business, if we want to be successful and become financially free.

J:
Make sure you listen for that one thing and it doesn’t go by quickly. We talk about it for awhile, but listen for that one thing we should be learning about today. Next, we talk about why building a media company and a media brand may be the next big thing. Codie talks about how throughout history, there’s been different types of leverage that have allowed people to become financially free and to become wealthy, and how today that piece of leverage may very well be an audience, and how you can start building your audience and building your brand.

J:
Codie actually provides a step-by-step approach to building that audience and to building that brand. Make sure you listen to the very end, because we get into buying and investing in businesses, small businesses. We talk about angel investing and Codie provides some tremendous advice, for anybody out there that’s looking to start buying into businesses or doing angel investing or anything like that. Literally this is one of the most jam packed episodes with just tips, advice, just amazing ideas for anybody looking to build financial freedom.

J:
I am so sorry that this is the last episode for now, but I am so thrilled that this is the episode we’re ending with, because it really sums up so much of what we talked about for the last two years. Okay, wow. That was a mouthful and I probably strung that out for a long time, but I think you’re really going to love this episode. Let me reiterate what Carol said. Thank you everybody so much for tuning in for the last two years. I really hope you enjoy this amazing episode that we have for you today with Codie Sanchez.

J:
For more info about anything we talk about today, check out our show notes, Biggerpockets.com/bizshow105. That’s biggerpockets.com/bizshow105. Without any further ado, let’s welcome Codie Sanchez to the show.

Carol:
Codie, thank you so much for joining us today on the BiggerPockets business podcast. I’ve got to tell you, J and I are absolute huge fans. We have so been looking forward to this conversation with you, and you have so much amazing knowledge and expertise to share. Thank you for being here with us today.

Codie:
I’m stoked.

J:
We are really excited to have you. I need to start with this question because I’ve been following you for a little while now. Every time I listened to you or hear about you or hear from you, it’s kind of like, there’s a different facet of Codie Sanchez I learn about. I believe you started out as a journalist. You were a mutual fund manager. You have an MBA from Georgetown. You have your PhD, so I guess we should be calling you Dr. Codie Sanchez. I apologize for not. You are a VC. You’re an angel investor.

J:
You do a whole lot of stuff that you’re a social media icon. You’ve got a huge social media following. I guess my first question is, I’d love to get your take on who you are, what you are, where you started and what you’ve become? But I also want to ask how do you have the time to do all of these things?

Codie:
Well, I think the biggest thing is I really like to start things. I’m a big foundational, let’s lay the foundation, let’s start this. Then once something gets to a point where it’s rolling and everything is moving along, I usually back out and that’s when I want a team in there that’s going to continue running it. A perfect example for that is Entourage Effect Capital, which is our cannabis, private equity fund. We raised the first couple of hundred million dollars, and as that business has stabilized and we’ve started growing the business and we have a team to fundraise, now other people do most of the work there.

Codie:
I sit on the advisory board and bring investments and ideas, but I don’t have to be actually cold calling people for investments anymore. I think the most important thing is that, I basically build myself out of a job in every job, career, business that I create. That’s been just huge for my ability to keep creating and to not stagnate.

J:
I love that. It’s a hard thing to do because we all talk about this idea of working on your business and not in your business. In the entrepreneurship world, we often talk about you are the one that builds your business, but then if you do it correctly, you hand it off to a team and you start to slowly extract yourself from the business, so that you can take either a more visionary role or you can move on to the next thing. But for so many of us that’s a pipe dream. It’s hard to actually do in practice, even though it sounds so good in theory.

J:
What are some of your piece of advice, for how you actually go about extracting yourself from each of these businesses after you’ve gotten them rolling and moving, and to the point where you feel like they could be self-sufficient?

Codie:
Rule number one; don’t operate from a place of fear. The biggest reason why most people, even employees won’t be able to progress and move forward is, that they’re scared that if they hire somebody smarter than them, or they hire somebody who’s better at these skills than them, that that person will supersede them. Instead, what usually happens is you’re seen as a finder of talent and that’s actually a superpower in today’s age. I would say the very first thing is, don’t operate from a place of fear at all.

Codie:
Always try to find the best talent you humanly can and then find talent that actually fills in your weaknesses. My very first business or my very first big business was an asset management firm in Latin America. I am not so great at details in any way, shape or form. I’m anal retentive on things and that I want branding this way, and I want the words this way, but when it comes to, oh, there’s a grammatical mistake here, or we were supposed to send at 9:50 AM, and I accidentally sent it for 9:50 PM, that’s the type of stuff I do.

Codie:
I hired somebody who was so detail oriented that she got excited organizing my wallet when she’d meet me, because it was a mess and she wanted it to be all organized. That is I think one of the most important things, don’t be scared to hire people better than you, and then hire people that are better than you at your weaknesses. Then the last thing is realize, eventually if you want to do this, you either need a company that supports this kind of behavior that will see this ability and continue to promote you, because they realize that you are a talent finder or you’re going to have to start your own thing.

Codie:
When you start your own thing, it’s much easier to hire really incredible people. But then you’ve got to figure out how do I incentivize them? One of my biggest pet peeves, one of the partners at one of the firms I worked at, he was all on one of our analysts. He’s not doing a good adjunct job. He’s not doing this. He’s not doing that and I said, “Well, have you talked to the guy?” He’s like, “Well, yeah. I told him this is what he needs to do.” I said, “Well, that’s not really talking to him. That’s talking at him.”

Codie:
You’re trying to work in this 19th century model of thinking that you own somebody and guess what, nobody owns anybody these days. There is a hugely transient market and so I said, “You’re never going have great employees, because you’re trying to be a dictator and sorry, this is a democracy.” What you need to do is then talk to the people. Lots of the people on my team right now, they’re not motivated by money. They’re motivated by do they get to do what they like to do with whom they like to do it when they like to do it?

Codie:
As long as I understand their motivators, then I can have a team that does a bunch of stuff so that I get to do the things I want to do, and lo and behold, they like the stuff they get to do.

Carol:
Very cool. I want to dig more into Codie, a few of these overarching themes you’re talking about, right? I heard you talk about, for example, finding the best talent now can truly be considered a super power. I love that, and things like making sure you are not operating from a place of fear. You’re finding people who are motivated by very different things than money. In all of those, I guess, are very different ways of thinking from what has typically been done throughout the life cycle of business, which I think really lends well to contrarian thinking, which is what you are all about.

Carol:
Can you please tell us more, what is this whole concept of contrarian thinking, which implies going against the crowd? Tell us what you mean by that and how do we go about getting ourselves in that mindset too?

Codie:
Yeah, so contrarian thinking we have a motto, which is that we like to get people to think critically and cash flow unconventionally. The goal is really this, that my belief through years of being human, human trafficking as a journalist and drug smuggling, and seeing the base level of humanity and what we’re all really striving for, and then going into finance and working with billionaires and multi-millionaires and presidents of countries and CEOs of companies like Apple at the time, when we told them how to invest in portfolios, what I’ve realized is there is no freedom without financial freedom.

Codie:
We start with financial freedom because I have a belief that when you are financially free, that is today’s Maslow’s pyramid and the Maslow’s hierarchy of needs, right? If you are financially free, then you can actually get to what I think is the most important freedom for our society today, ideological freedom. Meaning, you can say what you actually think, you can do what you think is right and you can stand up for what you believe your ethics and moral compass are.

Codie:
But until you have financial freedom, it’s really scary to stand out from the crowd, because especially in today’s world where you don’t just get kicked out of one town, you might get kicked out of a society or platforms or whatever the case may be. We started contrarian thinking, because I was like, “We’ve got to be able to question things and we’ve got to be able to get people to financial freedom, because if we have those two things, then we’re going to have a society that is actually rational and able to operate from reason as opposed to fear or prejudice.”

Codie:
That’s been our entire goal. Now, we have 115,000 people along for the ride with us, which has been really cool to see.

J:
That’s awesome. I want to talk about that 115,000 people. But before we do that, I love this idea of the Maslow hierarchy of needs and really that need to be financially free, because it sets yourself free. It opens yourself up to be able to focus on other things in your life that are important. It’s basically a gate. For those of our listeners who agree with that, and I assume all of us agree with that, but don’t really know where to start, what is your just general recommendations for a path towards financial freedom?

J:
Should we be starting businesses? Should we be getting a nine to five job and starting there? Should we be doing “side hustles?” What’s that formula that you recommend to people that are young and want to get on this path to financial freedom, but don’t really know where to start.

Codie:
Yeah. Well, first of all, I don’t think it’s just for the youth. Let’s clarify that upfront. You all know this as well given all the circles we run in, when I think about my father who ran businesses for many years, he would never call himself an entrepreneur though. That was a word he wouldn’t have even thought of. He’d be like, “I’m a small business owner. I run a small business.” No ego about it at all. But this is something that I’ve been putting into place for him too, because he’s worked his entire life and largely sales, thinking of real estate.

Codie:
He did commercial real estate, industrial real estate. Anyway, so those are hard ways to make a living especially when you don’t realize at the time. For so many years he was risk adverse, so he didn’t do what you really have to do to make wealth in real estate, which is do the transactions, take the money and actually invest in assets. You just did transactions, transactions, transactions, transactions, and trying to stack wealth that way it’s really hard to do.

Codie:
But I think the most important thing is first you’ve got to actually start with something that is so annoying, but so true. You’ve got to start with your mindset. This is where I think most people fail is, people love to play the victim. I just get so annoyed by this, because I’m a woman, I’m a Latina. In today’s world, those are two things that are seen as potential victim status and I think it’s ridiculous. I think in today’s age, if we look at the numbers and we forget about the narrative for a second, take out emotions and look at the math, what we find is there’s no better time to be alive from a longevity perspective, from a decreased likelihood of violence perspective, from a prosperity perspective and from a personal freedom, at least in the US perspective.

Codie:
Literally categorically, no better time to be alive. Now, does that mean that everything’s easy? No, of course not. This whole part of life is really, really difficult, but I think where people have to start, if you could start with one thing, it’s that everything that happens to you in your life is a product of your actions. That’s sucks for people to take in, that you are your biggest personal responsibility. But heck if you look at any religion from Buddhism to Islam, to Christianity, that’s what they all say. Buddha says life is suffering, right?

Codie:
They actually, there’s a quote that I love from this book I’m reading right now called Inner Engineering that says, he says, “I have given you so much suffering. Why are you not wise?” I love that line. We start with that. We start with, can you change your mindset to really appreciate all the difficulties that have been placed in front of you because they’re going to make you harder, just like the more that you lift weights, the bigger and stronger you’re going to get? Once we can get there, then we can move to financial freedom, and it all starts with personal responsibility.

Codie:
Are you allowing somebody to give you a paycheck? Are you realizing how to create your own?

Carol:
Super. I would like to know your path to financial freedom. You talked a little bit about, you did all these other things before, as a journalist, as an analyst, working in all these different spaces. You talked about your thought process around why you needed to become financially free, to be able to do all of these things and you shifted your mindset. What were the first couple of steps you took, or the first couple of businesses that you invested in or started in whatever to pull you out of that being relying on somebody else giving you a paycheck versus you creating your own paycheck? What were a couple of those things?

Codie:
Yeah. Well, first I think in the very beginning, you want to earn as much as possible. Say for like the first two to five years of my career, I was optimizing for the highest salary humanly imaginable. To find the higher salary human imaginable, I went to finance. At the time that was the highest paid. Now it’s probably tech, but you can make a lot of money in both. I optimized for my salary. I would negotiate my salary at least twice a year, if possible, three times a year, if really possible on quarterly bonuses.

Codie:
There’s actually statistics, you can look at the difference between somebody who makes $100,000 a year, starts out with a 10% increase year over year, and they negotiate a salary increase every year versus somebody who starts out with $100,000, exact same thing. If they get their 10% increase year over year, they don’t negotiate a salary. At the end of their career, the difference is $2 million. Start with where you are. You can always negotiate, because the worst thing that’s going to happen is they’re going to say no.

Codie:
That’s what I did first, is I would negotiate my salary and then negotiate … I wouldn’t say like, “Hey boss, I want to make more money.” I’d be like, “I want to make $100,000 this year. Right now I make, I don’t know, $70,000. What would it take for me to get from 70 to $100,000?” Then my boss would say something like, “Well, I don’t know, Codie, that’s a big job.” That freaks bosses out, and you say, “Well, how about this? If I actually my sales by 25%, then it would be here. What if I decreased our bottom line by this then it’d be here, then I’d make you guys maybe 2X what I bring in.

Codie:
Do you think that that would be enough to get 100K?” They’re like, “Yeah, sure, perfect. I’m going to write that up. Would you mind reviewing that? Then if I get there, we can talk.” I would do that every single year. Then I started to take every dollar that I made, rich dad, poor dad. You don’t have to recreate the wheel. I took every dollar that I made and I put it towards investments. At the time, all I knew was the stock market, but it could be real estate too. I put it in the stock market and I put it in things that earned money for me.

Codie:
Then I would say about five years in, no, actually I guess it was more like three years in, I started doing side hustles and side businesses. They all failed. None of them made money in the first five years, I don’t think. But I learned a lot about how to create stuff online, about how to sell a business, about what kind of businesses I don’t want to buy. These were websites. One was like a news site. One was a marketplace for stylists. They were very small scale, but taught me like, “Oh, I know how to make a dollar online.” That’s actually really powerful.

Codie:
That was my model. I start with earn as much as possible, and then I go to learn and then I go to learn, earn and what was the last one? Oh, and then you take the money and you invest in big risks.

J:
I love that. It’s so funny because what you said very much mirrors, Carol or my experience and what we like to teach our kids, what we often talk about on this show. We started in Silicon Valley. We were in tech for a long time. We made a bunch of money and then we use that money to start buying assets, not to start like, as we were making money, we were buying assets. Then once we realized, “Okay, now we have a nice little nest egg. We have some assets. Those things are growing for us.” Then we said, “Okay, now it’s time to start with the side businesses.”

J:
From there we grew into additional investments and now we do angel investing and all these other things that I know you do as well. It’s one of those tried and true paths, and we often hear so many people say, “No don’t do the education thing. Don’t do the college thing. Don’t do the nine to five thing. Just go out there when you’re 18 years old and start a business and make $10 million.” It doesn’t always work that way. There’s nothing to be ashamed of by starting with a nine to five job. I love the way you said, “Figure out what your highest and best use is or your highest and best opportunity is.

J:
When you’re looking for that nine to five job, make as much money as you can. Negotiate, negotiate, negotiate. I would also, and I know I’m just repeating the things you said, but it’s such gold. I love and as a hiring manager for a long time, I was at Microsoft for most of my career. I did a lot of hiring, managing people that would come to me during our annual reviews and would say something like exactly what you said, “I currently make $70,000. I want to make $100,000. What can I do to get from $70,000 to $100,000?”

J:
They’ve now put the onus on me to help them achieve their goals. Instead of asking me, they’ve instructed me to tell them, and now this forces me to come up with a plan for them, and then when they carry out that plan, I’m now somewhat obligated to actually help them achieve their goals, because I created that plan for them. That is just absolutely brilliant, so thank you for that. Again, I apologize for just repeating what you said, but it’s such a goal that it just needed to be said again.

Codie:
Yeah. There’s one little thing I wanted to add, which is, I love your comment about nine to five not being bad in the beginning, because I totally agree. There’s a saying and invest in that you should never invest with somebody who hasn’t already lost $500,000, because the first $500,000 that you invest in, at least this is a public market saying, you usually have no idea what you’re doing. You’re learning on somebody else’s dime. The saying is like, that’s why you don’t want to take your first $500,000 and put it out into the markets and try to guess which stock is going to go up and down.

Codie:
You use OPM, other people’s money to do it because they can handle the losses more of these really big institutions. I think it’s the same thing, a little bit with businesses. I don’t think there’s anything wrong with starting out by learning on somebody else’s dime. Get paid to learn, and then once you see some opportunities, you can start laying those on top of it, but you don’t have to have the first losses be your own and be sitting in your parents’ basement, wondering how to pay for your night out or whatever the case may be.

Carol:
Super, super. Going along this path of earn, learn, invest, so you took this path of like you said, maximizing your income potential, strategically planning how to make that happen, negotiating every step of the way. Once we have done that, where we’ve built up some money to work with, what do you recommend are the right type of businesses to be investing in? Are they the big, like we talked about earlier, are they the finance and the tech and those big flashy things that have that really big carrot at the end? Or is it something else?

Codie:
Yeah. I don’t think most people, myself included are going to build the next Tesla, Facebook, Microsoft, or whatever the case may be. I think one of the most powerful things is when you can realize that innately, if it’s true, you are not so much smarter than anybody else. I’m no genius. I am just as likely to make mistakes as anybody else. Once I realized that I was like, “Okay, so if I am not going to be the next Elon Musk, then again, what is the path of least resistance with highest ROI, return on investment?”

Codie:
What I’ve found over the years is those are usually businesses that people don’t think are sexy. There’s two different things I like to do. If I’m going for a pure monetary return, then I like to buy what I call boring businesses. These are businesses that are things like Laundromats, HVAC, care, home services, what else? Podcast production services, I own one, videography services. These are things that do not have a moat around them. You’re going to have a lot of competition in these businesses, but typically that competition isn’t incredible.

Codie:
There’s a very low expectations set for your house cleaning services. There’s a very low expectation set for your lawn care services. If you can just beat those low expectations, you can have a really, really profitable, long tenured business. I like to buy those types of businesses, but it doesn’t fuel me to only own those types of businesses. The second type of business I like to build as opposed to buy are high margin, low people businesses. Those are things like my newsletter Contrarian Thinking. We run this business, which is a seven figure business now, and we run it with four contractors and myself.

Codie:
The business was profitable day one, because I did it myself and the same thing with financial services firms, raising syndicates, raising funds. They can be profitable day one because you don’t need a lot of people to execute on these businesses. Boring businesses for you to buy and cash flow and then high margin, low people businesses for you to actually build and run, those are the two I like. Then these types of businesses can be really fun to run. They could be sexy. They could be tech. They could be SaaS.

Codie:
They could be VC, but these businesses will be your guaranteed bread and butter every month.

J:
Love it. Yeah, we, we often talk about, when you talk about low barrier to entry for these boring businesses, the advice we often give to people is enter your phone, have good customer service because you’d be surprised how very low barrier to entry or low barrier to success these businesses are. Sometimes, literally just being responsive to customers will set you apart from your competition. It doesn’t have to be, like you said, the next Facebook or Tesla. I love that. You’ve done the nine to five thing. You’ve done the private equity thing.

J:
You’ve done the starting and building businesses thing. What are you doing today? How would you define yourself? Because you do all of these things. If you meet somebody at a cocktail party and they say, “Codie, what is it that you do?” How do you answer that question?

Codie:
Yeah, I need a better pitch on this lately. I used to say, it’s been funny over the course of the year. I usually say something like finance, like keep it pretty short, because then I don’t want to get into all of it. It depends, like if you’re sitting next to me on a plane, I’ll probably say, “I’m a sales person. Do you want to talk about the product that I have right now,” so that they won’t talk to me anymore. But if I’m at a cocktail meeting and I want to impress somebody or a cocktail party and I maybe want to impress somebody, I usually say something like, “I founded a media company and I run financial syndicates investments in a micro PE portfolio.”

Codie:
I make myself sound fancy there. But I think you know, these days, what I’m realizing, and I don’t have a good term for it, so I got to work on this is that, I have a belief that in the future, venture capital firms, private equity firms will also be in the content business, but the two will be interchangeable. This is pretty contentious right now, especially in PE. A lot of my partners over the years have completely disagreed with this at the maximum high level, because there’s a saying in finance, which is get rich quietly.

Codie:
That’s because historically these people are driving Ferrari’s and cuff links, and I don’t know, strippers and whatever they’re doing and not really my cup of tea. The difference today is, I think I’m an investor first and foremost. I make all of my money, most of my money off of companies I’ve invested in, companies I’ve bought, companies I’ve sold and companies I’ve built, investor hat. But this media hat that I have, which is Contrarian Thinking, an ecosystem of newsletters, which on top of that as an ecosystem of education companies, so to teach different courses, masterminds events, et cetera, which on top of that is a series of let’s call them copywriting products and info products online.

Codie:
That business is a direct funnel and lead gen to all of my investing activities. It gives me my investors. It gives me my deal flow. It gives me ideas and it gives me an unfair advantage. I think in the future, the VCs that don’t have this other arm, your money won’t be enough. Right now, we throw money around and we say like, “Oh, I have billions under management, and thus you should beg me to invest in your company.” Going forward because money is relatively prolific, it’s all around for the best investors, what they’re going to want is the new type of leverage, which is audience paired with capital.

Codie:
If you don’t have the two things, I don’t think you’ll get in deals. We can see if I’m right in the next 10 years.

Carol:
This is exactly what as you’re talking through this Codie, I’m sitting here and I’m looking at J, I’m like, “This is exactly, exactly what we wanted to dig into.” We wanted to pick your brain about and talk with you, because we so firmly believe exactly what you’re saying. As we know, online, capital, VC, all of it, it goes in cycles and it’s grown differently. We vary, maybe J not as much as I, I very firmly believe that this is just the direction of everything is, the whole online world is all going to be about creating media and creating content.

Carol:
That is what is going to; everybody’s going to do online. It’s all completely interconnected, right?

J:
Not just build media and content, but also build a brand around that media and content, and the opportunity for the small guys and girls to be able to compete with the large content brands, because we’ve leveled the playing … The Internet’s leveled the playing field for content creation.

Carol:
Totally, exactly. Thank you for wrapping that into there. I would love to know … I would love to brainstorm with you about this, how you have done this. You talked about your newsletter, the education, the copyrighted info, that type of thing. Right now, I think a lot of people are in this whole, I want to say like early stages of building their own personal brand online, but being limited almost, not necessarily limited, but have a bloated out a lot further than like Instagram, Facebook, maybe some TikTok whatever, taking this whole notion of building your personal brand.

Carol:
But you, I’m wondering if you started there and then started expanding out into all these other channels that have helped you build out this entirely robust media company. I guess I’m wondering what your path is, and along with that how do I for example, somebody who’s just doing some stuff on, again, Instagram, Facebook, TikTok, maybe a little show here and there, whatever, what are the steps you would recommend for people to capitalize upon what the thing is that they’re most passionate about?

Carol:
Whether it be pet sitting or whether it be lodger bats or whether it be financial freedom, whatever, starting small and growing it out into some big rich, robust content platform that attracts private equity and venture capital?

Codie:
Yeah. Well, two skills I would start with first of all, if you could do one thing today, I’d say become exceptional at copywriting. Copywriting in my opinion is one of the most powerful skills in tandem with the ability to code. I don’t have that skillset. I don’t know how to code, but if you think about leverage and let me just explain a theory that I have here for a moment, there’s essentially been a history of leveraged shift throughout human history. We started out as leverage being humans. It was human capital, labor.

Codie:
Originally slavery and then fiefdoms and then employees, and that was the way that you took your time and multiplied it through other humans, labor. Then the second thing we had was, oh, and all of the wealth in the world was created through labor. If you look at the Pyramids, how are they created? Massive human capital. If you looked at Rome, how was it created? Massive human capital thrown at war. Second type of leverage, capital. This is when the Rockefellers and the Rothschild’s came to their great wealth.

Codie:
Why were they able to achieve great wealth? That was the advent of the banking system. When the banking system was created, that was when capital was able to be proliferated. There was debt and that debt allowed people to actually raise a lot of money and build big things, second type of leverage. Third type of leverage is code, right? That’s Bill Gates, Elon Musk, Jeff Bezos. These guys were able to code and instead of their leverage being capital or their leverage being human labor; their leverage was bots online, little robots that were able to multiply their efforts.

Codie:
Then finally, there’s audience. Audience, I believe is the next stage of leverage. These all build on each other. The best companies have all four. But audience is a way for people who don’t have an insider access. You need insider access to capital. You need insider access to have labor. For coding, you need insider knowledge. You have to be able to do the thing, and it’s not an easy thing. Audience, there are people online as you know that have massive audiences that probably aren’t the brightest crayon in the box, right?

Codie:
But that leverage, if you know how to capitalize on, it will be incredibly important. Where I would start is, I would start with copywriting. Why in this world of videos and that being more important, I would start with copywriting, because if you can write out your ideas succinctly and clearly, you can usually speak them more succinctly and clearly, and everything from your pitch deck that you give to an investor in order for them to invest in you, to the videos that you put out in order for you to get a massive audience starts with the words that you speak, which come from often the words you write down in preparation to speak them.

Codie:
I would start there and there’s lots of great ways to do this. I think the best way to learn copywriting is read some of the greats. I really like reading everything The Hustle puts out and Sam Parr. I like Sean Perry. I like Neville Medhora copywriting course. I think I’m pretty good at it, so you can go to Contrarian Thinking. I would read those and then what you need from that is, you need a voice. When you read my stuff, your goal should be this when you’re putting out content. Repel those who you do not want in your group.

Codie:
Attract incredibly, aggressively those you do. Your goal should not be that everybody loves you. Your goal should be that they love you or they hate you, the two. I have to remind myself of that constantly, that I am in an active battle to push away those people that are not my people, and to draw in those people that are my people, and that it’s okay to not have people like you. Now, my brand’s pretty, I don’t think it’s the most aggressive, but it’s a little edgy. It’s a little aggressive, but lots of people’s aren’t.

Codie:
You can be very soft and flowery and kind and lovely, you’ll still repel the people that aren’t into that, but you can do it multiple ways. I would start with those two things. Do you have what your voice is? What I’ve found is, if you’re hiding in any way, shape or form, if you’re not who you actually are, people realize that online. The more that I’ve stepped into this super annoying buzzword of being relatively authentic wherever I am in this moment, the more people are attracted. The more that I try to do it just like somebody else, the less people roll with it.

Codie:
That’s where I’d start is, copywriting, voice and then the third leg is, if you are incredible at writing and you have an incredible voice but nobody hears it, well, it doesn’t really matter. That next part is distribution. But a lot of people start with distribution on certain things and I wouldn’t do that. Start with making your product and what you talk about and put out there as engaging as possible, and then focus relentlessly on getting all the ear buds to hear it.

J:
Wow. I just, I love everything you’re saying. What you were saying about repelling those who aren’t right for your brand, it really resonates with me because it’s hard because everybody knows me. I have this brand in my niche in real estate, and I’m a people pleaser. I always want everybody to love me, because I feel like if not everybody loves me; I’m limiting my potential audience. There was a quote somebody said on this show a couple of weeks ago, which went something like, half the people like hot tea, half the people like cold tea.

J:
You’re not going to build a business around providing warm tea. You can’t make everybody happy. Sometimes you just need to remind yourself that there are eight billion people in the world, you can repel 99% of those. 99% of those people can hate you, and there may be even be some advantages for them hating you. But let’s say there is zero advantage for them hating you, even just 1% of those eight billion people is enough to make you the most popular person on the planet. It’s a fantastic reminder.

J:
Thank you for that. I want to go into the third thing, so learn copywriting, know your voice and then the third thing is distribution. I’m going to talk a little bit about that, because you’ve been really good at that. You have an amazing following. You seem to know your audience well, and you seem to have a very focused strategy for your distribution. Can you give us some tips for how we can be better at distribution? Let’s say we know how to write. We’ve found our niche. We’ve found our message. We’ve found our voice.

J:
We know who our audience is, and now we want to go, and I’m not going to use the word monetize, because that sounds too transactional. But at the end of the day, that’s what we’re trying to do. What do we do to capture that audience, the attention to that audience?

Codie:
Yeah. Well, so I think monetization comes after distribution in my opinion. First you want to get a little bit of an audience underneath you. You want enough people to have received free value from you consistently that you have a few raving fans. The few people that read everything you do, that comment on everything you do. One of the things you want to do upfront is over serve those people. It’s hard because sometimes I’m like, “Oh my gosh, Josh again, there he is.” But you actually want to make sure that you’re commenting and saying like, “Yeah, buddy, appreciate you.

Codie:
Thanks for being here.” Before I got to monetization, I started with distribution and I for a year wrote my newsletter for completely free. I didn’t make a penny off of it. I don’t think you have to do it that way. There’s plenty of ways to monetize earlier. I just chose it that way, and I think I was on Instagram for maybe two or three years with free stuff. Not very thoughtful things to be fair. It was sort of like what I wanted to share at the moment, which is not a good growth strategy by the way.

Codie:
But a couple of years on Instagram for free and a year of the newsletter for completely free. Then I think the biggest thing that hit my change in subscribers is, I found similar audiences to mine and I started to serve them. The best way I think to do that is through, you can pick your platform. Your platform could be Twitter, it could be Facebook, it could be Reddit, but you need to have somewhere where there’s a grouping of individuals that are the people that you want to attract. They’re your people; they’re your target audience.

Codie:
What you want to start doing is getting the content to them. You want to use somebody else’s … It’s just like, who is it that talks about the 10,000 hours? I can’t remember the name of that book.

J:
Yeah, [crosstalk 00:42:49].

Codie:
It’s not Godden. Malcolm Gladwell.

J:
Malcolm, thank you.

Codie:
Yeah, no, you got me there and we could play Pictionary. You want to steal a little bit of attention from somebody else’s audience that’s similar to yours. For me, that was very graciously, a group called The Hustle. They were very similar to mine and Trends, they were similar to mine as well. I went in Facebook groups and I started serving them. I wrote ideas. I wrote lengthy sort of not blog posts, but comments that were essentially like, “Hey, here’s a blog post in 30 seconds. If you guys think this is interesting, I’ll comment below my article.”

Codie:
I would get a couple hundred subscribers by having really good tailored, value-added content on these other people’s big platforms. Let’s say that somebody is listening to this and they’re in the wellness space or like the health care, they want to, I don’t know, they want … Oh no, let’s do real estate because a lot of people are like, Biggerpockets is a perfect one to do it with. Go into the Biggerpockets Facebook community; write a bunch of posts that are wildly specific breakdowns of a deal you did, the mistakes you made, dollar amounts, what you would have done differently and then say, “I just want to get your perspective on it at the end on X and Y and Z,” whatever it is, and then put in the comments the link to one of your articles or lead capture.

Codie:
Then respond to every single comment and then do that twice a week, every week for a couple of weeks and do it not just in Biggerpockets. Do it in Tony Robbins. Do it in My First Million. Do it in as many groups as you can the same thing until you find … What you’ll find is, you’ll start with like 30 of these groups and then you’ll narrow it down and you’ll get to three or five of these groups that actually really resonate with you. Then you double down on those and you forget all the rest. That’s probably where I got my first 10,000 subscribers, was piggybacking off of other people’s audience in a really thoughtful and value-added way, to the point that this isn’t spam, it’s huge differentiation.

Codie:
These groups now ask me to give them advice. They ask for consulting on the business that they’re doing. They ask me to join panels with them and whatever, because I had actually really served the community with cool ideas that served me too. It’s totally viable to be mutually beneficial.

Carol:
I love this. Codie, it’s almost sounding like you’re using the idea, through commenting on other forums and that type of thing to attract and grab your audience, and figure out what they are looking for and custom tailoring those messages to them. It sounds like really using this notion, this idea of testing a business idea before necessarily spending money to build an audience. Is that accurate?

Codie:
Yeah. I think it’s a little bit simultaneous. I like to talk about building in public. While I am looking at a deal, I’ll share that deal with this group, “Hey, I’m looking to buy this business and here’s the metrics on this business. I think this makes sense here. What do you guys think here? Here’s the stuff that I don’t like about the business,” or, “Hey, I’m thinking of starting this idea. Here’s all the best resources I use for the tech stack for the idea.” Am I missing any of those?” I think you do it simultaneous, so that they get to see, then they know it’s real, right?

Codie:
It’s not theory. You’re not saying, “I’m thinking about doing this.” You’re like, “I’m actually doing it or I did it.” You share the missteps too. You’re not like, “This is how I made $20,000 in 24 hours. You can too.” You’re like, “Hey, this product is now doing $10,000 a month. That’s really cool, but I lost 50,000 upfront and here’s how I lost the 50K. There’s probably a smarter way to do it, and here’s how I do it next time.”

Carol:
I love it.

J:
You’re building trust through relatability.

Codie:
Yep.

Carol:
I’m curious to know, as you were engaging with this audience which you built like your first 10,000 people, for example, were you then able by continuing to provide content, get answers from them, build trust and all of those things? Were you able to tap into that group to help you determine what new type of content you needed to be building out, what would serve them the best and ultimately help you expand your business?

Codie:
Yeah. I definitely, I tried to get them to comment a lot. Well, first of all, let’s start with this. I love email. I think everybody should capitalize on email if at all humanly possible even if you’re sending videos via email, because then the algorithm can’t mess with you on any of these platforms. If you don’t have an email list, I’d get one because you actually own those customers as opposed to any other type of platform, you don’t own those customers. When I did email, I made sure that the email provider I used allowed for comments, can I respond to every single comment of theirs?

Codie:
The more I’ve gone along, the more I’ve realized the benefit of asking questions to your audience in your emails, not fake questions too. Comment, yes, if you also want to. No, no, no. It’s like, “I’m going to do a breakdown of three businesses over the next 30 days. I’m considering this one, this one, this one, can you tell me which one you guys want to hear about next and why?” Best answers will win unless I don’t like your answer and then I’ll do what I want anyways. It’s like, something. I did a lot of that and then I judged a little bit by popularity.

Codie:
Just what posts did people actually like, what did they retweet a ton? What had the highest engagement and reshares were pretty data driven. Then we doubled down on the stuff that works and get rid of the stuff that doesn’t. But I think also you have to be a little bit of your own compass. These people are following or interacting with you for a reason. Because of that, often, if I found something interesting, I’d be like, “I’m sorry, I’m writing about this because I think this is interesting and valuable and you guys should too.”

Codie:
I think that’s good too. You don’t want to just be driven by the mob.

J:
I love that. Basically what I’m hearing is authenticity is your secret to success and following your personal compass. How much does, and I want to make sure to ask this the right way, because I don’t want to imply, but we all … All of us that have a brand, that maintain a brand we’ll obviously know that there are things that … Okay, I’m going to use me personally. There are things I could say and things that I could do. I’m a geeky engineering type, that’s built a brand around being an investor and being outgoing.

J:
It’s not completely authentic for me, but I recognize that that’s what my audience expects. I have to get out of my comfort zone. How do you balance the being authentic with also giving your audience what they expect, where it may not be what is 100% authentic to who you are if that makes sense?

Codie:
Totally. I always joke and I think I retweet this at least once a month, which is like be authentic dot, dot, dot. Humans aren’t ready to hear what I really think. I think there’s a portion of it where one, I don’t share a lot of personal stuff. You won’t see my family. You won’t see my friends. You won’t see my fiancé on a lot of the things that I do. I keep that relatively private. I’m not sharing what I’m eating ever. There’s, this separation between my personal life to some degree and whatever my brand is.

Codie:
Then also I try to lead people. I think about it similar to … I like to follow any of the greats. If you think about what anyone who created a big movement did, they didn’t start with the most aggressive ideas that they had. If you look at MLK, he was first talking about unity and he was talking about walking together and then eventually got to a point where it was like, “No, we want full civil rights,” and whatever the case may be. I think you want to start shifting them towards the ideas that you want, and that allows you over time to get more and more true to who you are.

Codie:
At least if you’re the type of person that doesn’t want to come out hard at them like that, and that would give you some consternation. For me, a lot of the ideas that I have, I probably don’t share 100% of what I’m thinking. I share that with some closer held groups, because I know that a lot of the audience isn’t fully ready for it. Every post isn’t going to be like, “Oh, you are jobless and you have no savings. It’s your fault.” That’s not really going to help people. You got to lead them a little bit. I’d say, do the same thing with your personal brand. You start to lead them to the person that you want to be.

Codie:
Then also don’t be afraid to change. Look at some of the big names out there. Tony Robbins, perfect example. Went from like mindsets to complete shift to financial guru and investment advice to health and wellness. James Altucher from losing everything all the time or from finance to losing everything all the time, to being an artist, to making money online, to chess. I actually think it’s okay to be multifaceted, but in the beginning you do want to have your niche. In the beginning, you want to say, “I am here to give you financial advice and to help you think differently.”

Codie:
Then you can start getting broader as you go, and you kind of increase those concentric circles.

Carol:
Very, very cool. I’m loving these examples of the people you’re using James, Tony. You yourself though, Codie, you are also very multifaceted in the things that you do. Another thing that I think you do that we haven’t really dug into yet on this show is, all the angel investing that you do, and so many people in our community are so incredibly interested in that notion. We like to dispel the fact that it truly is more than just a buzzword now. it is another way you can look at increasing your financial freedom. With it being such a hot topic, how do just the normal people, how do people who are interested in going down this path of angel investing get started?

Codie:
Yeah, well, first I’d say don’t do it. Don’t do it just to make money because to be fair angel investing, you have to invest in 20 different deals for one or two of them to actually hit. It should not be at all the first type of investing you do in any way, shape or form in my mind. It shouldn’t even be the second or third. In my opinion, probably the first and this is not investment advice, it’s just what I did. I would start out with stocks, broad indices in the stock market, ETFs, low-cost investments. That’s what I did.

Codie:
Then I went to more active funds. Then it was like, active mutual funds, things like leveraged finance, inflation, protected securities, depending on the time period. Then I went to alternatives, hedge funds, private equity, REITs. I got more and more aggressive as I understood financial investments. Then I went to hard assets, real estate, multi-families, apartment complexes, industrial, commercial. I moved up the chain and real estate. Then finally I started going and investing in individual businesses, because they have the highest risk reward ratio.

Codie:
You can lose the most money on them, but you can make the most money on them. I wouldn’t start with angel investing. A couple of caveats to that would be, if you can structure deals where you make money on day one, where it’s a cash flowing asset on day one, you can actually de-risk sizably from real estate in a couple of ways, but not completely. For instance, when I do a deal, most deals that I invest in, if I’m going to go buy a, I don’t know, let’s say that I’m going to go buy a CPG company, a coffee, mug manufacturing company, this company when I underwrite it, I want it to be profitable.

Codie:
I want it to be making at least $100,000. I want the business to be making profit, $100,000 profit. In revenue, I want the business to be making less than $3 million, then you don’t have to compete with the private equity guys as much. I want the business to be a very simple, straightforward business. We’re not trying to cure cancer. We’re not trying to create the next SaaS company. It’s very straightforward. I want the business to be able to ideally pay me back all of my money within a three, max five-year timeline.

Codie:
I usually buy businesses two to three X their profit. If I have a business that I’m buying, that’s making $100,000; I’ll buy that business for 200 to $300,000. At the end of two to three years, I’ll have gotten all of my principal, my initial money back, and then everything on top of that is gravy. The reason that that’s cool is because in real estate, what’s your normal mortgage, 30 years, right? Obviously you can do shorter term for commercial or industrial lease, but we’re still talking 10, 15 years.

Codie:
If I can have a business that has a much shorter risk window and typically quite a high cash on cash return, or the return on the money that you put down, I can probably get the best investment return in small businesses out of any type of investment.

J:
I love it. There was a great lesson in there just listening to you describe your criteria. Too often, I talk to people who want to get into investing in businesses, angel investing, investing in syndications that invest in businesses and they’ll come to me, because they know I do a bunch of that and they’ll say, “How do I get into this?” I’ll say, “Well, what kind of businesses, what are you looking to do specifically?” “Oh, I don’t care. Tech businesses or lawn care companies or anything. I don’t care, media companies.”

J:
“Okay. Well, what size company?” “I don’t care. Big company, little company.” A lot of these people are real estate investors because that tends to be my network and I’ll say, “Well, you invest in real estate, when you invest in real estate what do you look for?” “Oh, well, I look for between two and four units. I want something that has a cap rate of 6%, generally between 200,000 and $400,000 that doesn’t need too much renovation so that I’m cash flowing in year two.” I was like, “Do you hear the difference in how you just described how you look for real estate investments and business investments?”

J:
When I listened to you just discuss what your criteria is for business investments, that’s what most real estate investors have for real estate. You know what you’re looking for. You know why you want it. That’s your area of expertise. That’s your niche. That’s what you understand, and it allows you to basically weed out 99% of deals in the first five minutes, because they don’t fit your, let’s call it your buy box. It’s a great lesson there for anybody that’s looking to get into a new space, investing space, whether it’s buying businesses or anything else, understanding your buy criteria and really focusing on it when you make investment decisions.

J:
Let me ask you a question. Let’s say for some of us who might be interested in going out and starting to do a little bit of investing, maybe we want to go on to angel list and investor syndicate, maybe we want to come to you and invest through you, assuming you offer investments, how do we go about figuring out what the right criteria is for us?

Codie:
Yeah. Well, it’s such a good point you make and it’s so critical, so I hope people take away there’s riches and niches, like niche down, know your particular segment always. But it’s okay that you don’t know that upfront, which is why anytime I get into an industry, I always invest first in either funds or syndicates, because I don’t know enough to do it myself. I think that’s usually the biggest mistake that people make is, people go into a new segment and try to go direct. Then they have a one point of failure.

Codie:
If something happens to the one company that they buy or invest in, they’ve had a massive loss and they have no diversification of loss, and I don’t like that. Now, once you understand this space, then it’s okay to have one point of failure, because you have a really great return potential, and you’ve de-risked yourself from understanding the industry. But where I would start for almost anything, if you’re going to invest in small businesses, start by investing in a fund. If you’re going to start investing in startups, start by investing in a VC fund.

Codie:
Then once you’ve looked at those, you can look at individual deals. I think alongside a fund, you can do a syndicate too. You’re basically paying for expertise. You’re paying to learn. The cool thing about investing in a fund or investing in syndicates is you get paid to learn. Theoretically, these deals are going to have a return on your capital and simultaneously if you’re smart and what I do is, I try to believe the managers as much as possible. Tell why you invested in this. Can I look at one of your investment memos? Can I talk to the CEO?

Codie:
Can you tell me some companies you didn’t invest in? I’ll go really deep and do the due diligence of the actual syndicate manager or the fund manager, because I want to understand the business as fast as possible. I want to get money to work so that I have skin in the game, because you can learn all you want about things, but if you don’t have any skin in the game, how much more do you pay attention to a game that you have bet on? So much more, right? If you go and you’re watching the Super Bowl but you have no money on the line, you’re like, “Ah, when are the commercials going to be on?

Codie:
I don’t really care.” But if you have money on the line, things change. It’s the same thing with investing. That’s where I would start. Now, the other thing that I think is really important for people is, you want to figure out what do you actually want from it, to which people are like, “Money.” I’m like, “No, no, no,” because if I said, “Okay, great, I’ve got a hot deal for you that’s going to get you 20 bucks a month.” That’s not that interesting to you, right? You need to find your parameters. That’s why for me, if I’m going to get involved in a deal, it has to have at least $100,000 in profit to cash flow to me a year.

Codie:
Otherwise it’s not worth the time and the opportunity costs of everything else. We have a 10 step process on unconventional acquisitions, where we teach people to buy small businesses that essentially walks you through first understanding the opportunity so that there are all these businesses for sale. The second step there is deal clarity. What do you want first? I want $100,000 in passive income. Or I would actually be okay with $50,000 in passive income, if I didn’t have to manage it or whatever the case may be.

Codie:
I want it located here and I want to actually run the business, or I want somebody else to run the business, all these questions. Then you get to, “Okay. Now what type of business will help you most achieve those goals?” People usually work backwards. They’re like, “I want to buy a laundromat. Codie talked about Laundromats. Let’s buy a Laundromat,” and I’m like, “Wait a second.” If you had a laundromat and it made you $0, do you still want the laundromat? Of course not. You’re buying the business for a goal.

Codie:
If you don’t know your goal first, you’re going to have no idea where you’re going.

Carol:
Great. Thank you for clarifying that. We’re getting close to time here, but before we ask the final question of where you’re going and what’s next on the horizon for you, I want to touch just a little bit more about, you’re talking about this 10 step process. I think you call it unconventional acquisitions. Did I capture that correctly?

Codie:
Yeah.

Carol:
Can you just tell us a little bit more about that? I suspect our community will just eat that right up. Can you just give us a little more of info, a little bit more info what that’s all about, what we can expect from it?

Codie:
Yeah. Well, two things. One, if you like hearing about ways to cash flow and/or buying businesses, sign up for Contrarian Thinking. It’s at contrarianthinking.co, because I’m going to struggle a little bit to include all of it in this little 60 seconds spiel that I’m going to give you. Essentially what this is, is there’s a giant opportunity we touched on it, which is, I think that in 2008, if you look back at 2008, what is the one thing you wish you would have done in 2008, ‘09, ‘10, ‘11, ‘12, ‘15, ’16? Basically for the past 10 years plus.

J:
Bought, bought, bough, bought.

Codie:
Yeah, bought real estate. Real estate anywhere, anytime, if people ask me, people asked us when I was at Goldman Sachs in 2009 and ‘10, they were like, “Which stocks do you like?” I was like, “Yes.” That’s the same thing with real estate, which real estate do you like? Yes …

Carol:
All of it.

Codie:
… we’ll buy all of it anywhere. I think we are in that same period right now for small businesses. I think for the next three to five years, we’ll see what happens in the world. These small businesses are on pain. There’s a massive amount of boomers retiring, and so this segment of the market is really ripe. If you believe that there’s that opportunity, then basically what we did is I took my 12 years of investing on Wall Street and private equity, and basically created our curriculum based on how I do deals, to walk people through the entire buying a business process, steps one through 10.

Codie:
We have a process whereby at the end, you should have, you’ll have 17 hours of video. You’ll have 14, 15 templates from LOI to due diligence questions to a takeover checklist of how to buy a business. It starts with like I said, “Know the opportunity.” Then it goes to deal clarity. Then it goes to origination, which means finding deals. How do you find them? Then it goes to due diligence. How do you know it’s a good deal? How do you underwrite the deals, the term in finance? Then it goes to structuring, how do you structure the deal, price, terms, transition, period?

Codie:
Then it goes to financing. How do you pay for it, SBA loans, seller financing, equipment loans? Then it goes to transition. What’s your first 30, 60, 90 days of the business? Then it goes to closing. That 10 step deal is something that we in private equity charge you two and 20. We charge you a lot of money to do that for you. In my belief, that system should be democratized, because there are too many small businesses that need help right now. The private equity firms are too big; they’re not down here helping at the bottom.

Codie:
If more of us all buy these businesses, I actually think we’re going to have a much healthier economy, which is how we did it. We have a goal to create $100,000 business owners in that segment.

J:
Love it, love it. Tell us what is next for Codie Sanchez? Where do you go from here? I have a feeling that you have a lot more chapters to come, so what are the next chapter two for you?

Codie:
I think the biggest thing right now is, I’m a little bit on a mission to get Contrarian Thinking to a million plus subscribers. I want everyone to be able to get out of Contrarian Thinking, what really should have got in our MBAs. My belief is, if you read Contrarian Thinking every single week, there is no reason why you should not be able to get financial freedom within six to 12 months, no reason. You don’t actually need, it’s not just my lessons. I share lessons from a lot of other people, but the difference is, we don’t share just ideas.

Codie:
We have these playbooks where we essentially give you an idea to earn, and then we give you the entire step-by-step process on how to execute on it. I think that’s missing in a lot of the content out there. It’s like, “Hey, here’s this idea and here’s more and more and more ideas,” and you almost get overwhelmed. Then at the end of it, you’re like, “Oh my gosh, how do I even do this? There’s more ideas and which one should I do?”

Codie:
The biggest thing for me is if I can get a million people all thinking about, how we can push the envelope in question and how we can achieve financial freedom, then maybe there are enough people there lifting other people up instead of pushing them down and we can have some change. That’s the biggest goal for me overall. We are going to do what you said; we’re going to create a syndicate because I’ve realized a lot of people aren’t ready to take the first step themselves. They want a hand to hold for the first deal, which is, I totally get it.

Codie:
We’re going to start doing deals where contrarians can actually invest alongside us, and take the first step and realize they didn’t die or lose all their money so they can go do one by themselves.

J:
Absolutely love it. Okay. Codie, honestly, I could talk to you for the next 10 hours, but I know-

Codie:
Oh God, be careful what you wish for.

J:
… that you have a stop and we so, so, so appreciate you being here. This was an absolutely amazing episode. I’m not sure how I’m going to be able to distill this down in the intro into just a few nuggets, but I guess that’s my problem. Thank you so much. I do want to give you an opportunity to let our listeners know where they can find out more about you, where they can connect with you. Please mention the URL for Contrarian Thinking again, and anything else you want to tell our listeners.

Codie:
Yeah, awesome. Yeah, I think the best thing to do is go to contrarianthinking.co, sign up for the newsletter. It’s free. Get in the mix there, and then in that you’ll get access to unconventional acquisitions. I talk about it a ton. You’ll get access to my Twitter, which is Codie Sanchez, where I’m super building in public and share a lot, but it all starts with contrarianthinking.co.

J:
Awesome. Codie, thank you so much for being with us and we so look forward to following your journey and all the good stuff to come.

Carol:
Thank you Codie.

Codie:
Thank you so much. Thanks for having me.

J:
That was an absolutely awesome and amazing episode. Again, I’m sad that this is the last one for the time being, but what an amazing way to go out. Thank you, Codie for all that amazing advice. Listeners, community, thank you so much again for being with us for the past two years and all the support you’ve given us. Let’s do this sign off one more time. She’s Carol, I’m J.

Carol:
Sending gratitude to each and every one of you today. Thank you so much everybody. We’ll see you soon.

J:
Thanks everybody.

 

Watch the Podcast Here

In This Episode We Cover

  • Laying the foundation of businesses and “building yourself out of a job
  • How to extract yourself from your business and empower long-term success
  • Contrarian thinking and why it’s a crucial skill in today’s society
  • How to start a “high margin, low people” business
  • The one skill you should start building upon today
  • How to make your audience loyal and push away those who won’t like your offering
  • And So Much More!

Links from the Show

Books Mentioned in this Show:

Connect with Codie: