Air Date: 06.17.2021
Building A Multifamily Portfolio With Billy Keels
Real estate investing could be the key for you to achieve financial freedom. Learn how to build a multifamily portfolio with experienced investor Billy Keels.
Billy Keels always knew about the importance of having diverse income streams, but it took a few knocks for him to recognize the power that lies in real estate investing. Billy’s colorful life experiences led him to settle down in the South of France. However, his real estate investments are situated in his home country, the United States. Billy talks us through the dynamics of investing across the ocean, and how he has made a success of this endeavor while still maintaining a full-time day job which he loves. After managing everything on his own for a while, Billy realized the value in finding strong team members whose values align with one’s own (just like you would in a marriage partner!), and he explains the process that he goes through to find those people. There are numerous real estate markets that have investment potential, and Billy stresses how important it is to make your goals clear before making a decision about where you are going to put your hard-earned cash. Not every deal is going to be a home run, but don’t let that stop you from taking action and always continuing to move forward.
Key Points From This Episode:
- Lessons about work ethic that Billy learned from his parents at a young age.
- The work/travel experience Billy had after college and how that benefited him later on.
- Where Billy has been working for the past 15 years.
- Knocks that Billy took in 2000 and 2008.
- Billy’s journey into the real estate space, and why he chose to invest in the United States even though he was living far away.
- Why Billy chose to move from active to passive investing.
- Parallels between Billy and Kent’s real estate career paths.
- The importance of making your goals crystal clear before you start investing.
- Building a strong relationship with a team is a key element to success.
- Advice about how to find team members who are in alignment with your vision.
- A key element of the sponsor-investor relationship that helps Billy sleep well at night.
- Syndications are not always going to work out as planned; that’s part of the deal.
- The five languages that Billy speaks, and how he became multilingual.
- Why Billy will always ask a deal sponsor about the deals they’ve done which didn’t go as well as they had hoped.
- Billy’s highly recommended book that changed Billy’s perception of the world.
- Keep moving forward; final words of wisdom from Billy.
“Once you’re crystal clear on what it is that you want to be able to achieve through investing in tangible assets, then go to the location that actually makes the most sense for those types of goals.” — @billykeels [0:15:38]
“If you’re doing all of the work and you’re not getting the right response from the operator, maybe it’s not the right operator for you or maybe it’s not the right syndicator for you.” — @billykeels [0:18:12]
“It’s really important to recognize that even when we talk about passive investing, you’re not passively investing. You need to do work to make sure that there is an alignment.” — @billykeels [0:21:30]
“In those moments that are difficult, the most important thing is that the sponsors are in front and talking to you in a transparent way.” — @billykeels [0:23:42]
Links Mentioned in Today’s Episode:
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—Full Transcript Below—
“Without a doubt, it’s communication. I have invested passively in deals that it’s been three and a half years and I’ve seen zero return on the capital that was placed, right? I think that’s also one of the other things that you need to be aware of is the fact that not every single syndication is going to be a homerun.”
Welcome to Ritter on Real Estate, the show about how to passively invest like a pro. On each episode, I interview real estate experts who give their top investing advice, strategies, and tools and I break down the insights and the practical steps to avoid the pitfalls and make better investments. I want to help you passively invest like a pro. This is Ritter on Real Estate, and I’m your host, Kent Ritter.
[0:00:45.0] KR: Hello fellow investors, welcome to another episode of Ritter on Real Estate, where we teach you how to passively invest like a pro. Today, our guest is Billy Keels and he’s on a mission to help those high wage earners and/or retirees that have been forgotten about by so many in society. He’s determined to help you feel comfortable and confident going against conventional wisdom by being okay with investing in real assets and doing that beyond your backyard. Billy, thanks for being here today.
[0:01:13.3] BK: Hey Kent, this is really, really cool, love your energy man, and I’m really looking forward to this conversation today. So many things in common.
[0:01:20.7] KR: I feel like we’re just pumped up this morning. I’m excited for this man, this is unique because you’re in Spain right now, right?
[0:01:28.5] BK: Yes, I am.
[0:01:29.4] KR: You’re in Spain.
[0:01:29.9] BK: Barcelona.
[0:01:31.2] KR: There you go man. And you’re investing all the way across the pond and you’re doing it successfully so I want to dig into that. I want to understand man, because that’s got to be a complicated process. Before we get there, help the listeners understand your journey and kind of how you got to where you are today?
[0:01:50.8] BK: Yeah man. Happy to do that, Kent. I guess the origin of the story is just, I’m originally from Columbus, Ohio so I’ve lived in different places in the United States. I watched my parents, each one of them worked multiple jobs to make ends meet, things like that. I kind of saw early on what work ethic was all about.
Although, I also learned what you needed to do to not have to work so hard all the time just to make ends meet. Went to university at Miami University in southwest Ohio. Had this amazing job right out of college where I had the chance to work and travel throughout some 58 different countries in five years. It was just completely – just blew my mind.
After that, I didn’t see myself working in a “normal nine to five” and so I took a one-year sabbatical. I was accepted at a university in Paris called Sorbonne and when I went there, I said, “Man, you know what? I want to do three things. I want to learn how to speak French and learn more about the language. I want to learn how to salsa dance,” believe it or not, and I said I wanted to learn more about wine.
After about – I don’t know, it was probably six months in, I started, I had gone through the whole frustration and crying because I couldn’t actually get my utilities turned on and all this kind of stuff, and not speaking the language. I wanted to stay because I was starting speaking a little bit more French, I was learning more about the culture. And I’d worked with a lot of Fortune 500 CEOs during that five years and 58 countries and was fortunate enough to have the opportunity to apply for a couple of jobs and I started working, not back in the US but actually in the South of France.
I was there, I was working in IT, I got into the hardware space for the first time. I really didn’t know anything, didn’t know the difference between memory and hard drive or any of that kind of stuff, but it was a great learning opportunity. I was working and selling in French over the phone. Ended up getting sent to Italy to startup a sales team, so that was really not expected at all. And I went back to France and along the way, I met a really cool, cute Spanish woman.
We kind of went back and forth over about two years from France to Barcelona and well, you know what? I ended up moving here to Barcelona. Got married a couple of years later, I have two children and I’ve been enjoying working in a very large multinational for the last 16 years almost, which is kind of crazy. 15 years. Since 2006.
One of the things that happened, Kent, was, along the way –I’m a recovering perfectionist. I was the A student and I always did the things that you were supposed to do; you go out, you study hard, you get a good job and what do you do? You max out your 401(k). In 2000, I took a hit because the whole .com bubble was happening. That happened to a lot of people but what I kept hearing from my financial advisor was, “You know what? It’s okay, just ride it out, just keep – we’re going to do some dollar cost averaging, it will work out overtime, it always comes back.”
Then in 2008, I just got socked again in the stomach and I lost 33% of my multifamily portfolio and I was like, “You know what? Happens once, shame on you, happens twice, shame on me,” is what my parents always told me, right? That’s when I started, I guess I was looking for other things, I came across Rich Dad Poor Dad, started it, put it down, eventually picked it up, finished it and I thought, “Wow, this is amazing, I can actually have better control and I can produce real cash, not just on a piece of paper,” and so I got started and I really wanted to do that.
What happened was, I wasn’t sophisticated enough, because I was living in Barcelona, remember? As I looked to go out and purchase properties to get that 200, $300 a month, I didn’t realize that I was in the wrong kind of location because everything that kept penciling out was either zero, I wasn’t going to make anything or I was actually going to have to pay every month and I was like, “This is not going to work at all.” Eventually, because I’d been geeking out, I was reading so much stuff, podcasts and all that stuff.
I was like, “I’ve got to do something.” A couple of friends of mine were like, “Well, Billy, dude, you’re a US citizen, why don’t you just invest in the United States?” I thought, “Well, do you not see that Atlantic Ocean between the two of us? I’m not going to do that at all.”
One thing led to the next but eventually, I ended up purchasing property back in the United States. At that point in time, I was really focused on just properties and money. Since then, I mean, there’s been a whole evolution and I’m sure we’ll get a chance to talk about some of that but that’s really how I’ve gotten to this point in my journey.
[0:05:53.6] KR: Yeah, I mean, that’s an incredible story of traveling. International travel, international intrigue, all this going on. What really stuck out to me though is how your mindset evolved over that time. The conventional mindset, right? The mindset that you were being fed, which is just, “No, don’t worry about it, don’t worry about losing half in the .com or a third in LA, it’ll come back, just keep doing the same thing, it will be okay,” right? That’s what we’re fed, every day. Through the media, through everything else.
And then you picked up Rich Dad Poor Dad, which so many of us did. It just lays it out in, I think, such an approachable way and such a simple way that it’s like a no brainer when you read that, right? Because I had a similar experience where my mindset, it just exploded, “My god, look at these possibilities.” And I too, I fancied myself a savvy investor and I invested in the stock market for years. I mean, even since I was like in high school but I didn’t realize the power of real estate and then the power of real estate at a higher level, like going beyond just being your own landlord and things, right?
Just how your mindset changed and then I can’t imagine the massive mindset shift that had to occur for you to think, “Yeah, I can actually invest across the ocean, not just in my backyard but across the ocean. And I could be successful doing that.” I mean, that’s a pretty incredible shift to take from where you started, right?
Also, unique to you is, we were talking about this a little before as you like your job, you enjoy your job. And so many people I talk to are like, “Well, I hated my job and so that’s why I got into real estate.” For you, knowing that you still enjoy what you do, I mean, you still had the drive and the passion to go out and create multiple streams of income, right? Because I think that’s probably what you caught on to and what you realized. That need to diversify, and real estate was a great fit, right?
[0:07:56.3] BK: Yeah, I mean, it was definitely that. One of the things that I think that happens is we all get the same 24 hours in a day and there are a lot of people that love to sit around and watch miniseries or they like to sit around and do things that I just don’t particularly like to do. So rather than spending my time and energy doing that stuff, there’s nothing wrong with that but I guess I’m just wired differently, so I was thinking, “All right, want to learn some more, I want to see some more,” and then I got to a certain point where I was like, there’s like all this pent-up frustration, like, “I’ve got to do something.”
I just got to a point to taking action. I’m a recovering perfectionist. It built up to such a point and then I started getting those influences from other people because in the beginning, Kent, I thought, I was like, “You’re crazy, I’m not going to invest my money thousands of miles away,” because I’d always heard or understood that you should just invest in your backyard.
When I started realizing, “Okay, well maybe that’s not that far out there, I can actually build a system, I can do things,” or at least, I know about how to manage client relationships and so this was like going from client relationships to now resident or tenant relationships. And how do we make sure that our resident, our client, was the most taken care of so that they would eventually stay? There was kind of that – Once I got through that initial shock and scare of, “Oh my gosh, this is thousands of miles away or thousands of kilometers away,” or whatever, yeah, then it was about jumping in with both feet.
[0:09:18.4] KR: Yeah, I think that for the listeners, what I’m taking away is, there could have been a lot of points where your excuses could have gotten in the way, right? Too much time or too hard or too far away. And you were able to get through all those in a much more difficult situation than I think a lot of us are in, right?
If folks are sitting on the sidelines, whatever those excuses are, Billy’s were probably greater and he was able to overcome them and he was able to get to where he’s at. I want to use that as motivation for folks; just get through those limiting beliefs and just get started, right?
[0:09:56.0] BK: Yup, that’s exactly it, Kent, that’s exactly it. Get started.
[0:09:59.9] KR: So we understand kind of what brought you into real estate investing. Let’s really dig into – I think it’s so unique that you’re able to do it so successfully from such a long distance. I want to understand how you’re doing that. Did you start passively doing that? Were you investing with others? Were you investing on your own right away or kind of, how did that evolve?
[0:10:22.9] BK: I guess what happened is, in the back of my mind, I thought to myself after 2008, I realized that all of the things that I was doing, those really early morning plane rides and staying up and staying in hotels and just working myself crazy, and then the part that I really wanted, my financial life, that it was completely out of control. It wasn’t in my control, like that I had to do something completely different. As mentioned, when I realized that, “Okay, this doesn’t really seem that far fetched, let me go ahead and take action.” I was really focused on myself and on money at the time, right?
I didn’t even know that you could invest with other people. This was how naïve I was, Kent. I don’t come from a family that was involved in real estate or was involved in any of that kind of stuff. I was learning as I went. As I saw that there was this – I started building relationships from Spain back in the United States from – through family and friends and stuff like that and I had capital that I wanted to put to work.
Once I got on one of the agents listings, I was receiving MLS listings and going through those and put a couple of offers down and those weren’t accepted. And finally came across this duplex and put the offer in like super-fast. Got it accepted and then I was like, “Oh my gosh, now what do I do, what do I do?” From there, there was a whole, I made a whole lot of mistakes. I made so many mistakes along the way but I actually started actively investing for my own multifamily portfolio with my own money and building my own team. Even, it got to such a point, I was managing the properties myself from Barcelona. Which is not anything that I would recommend to anybody.
But like I said, I’ve learned a lot but the biggest thing was, I just took action. Having done, since then, I mean, I’ve continued to actively invest and I have now found out about this thing called passive investing, which is awesome too because you know, as you know, if I go ahead and I’m making sure that I understand the syndicator, the operators, could be the same, it could be two different individuals, that they are aligned with what I’m really looking for that portion of my multifamily portfolio to do, then that’s like fantastic. I could keep doing my job during the day because I like it, I don’t hate it.
My capital was constantly, like I say, is on the treadmill and it’s working and it’s running. Now, even to the point where I’m syndicating my own deals. I started out actively investing and I did that for a while and then I found out about this passive investing thing and I started doing that and then I was like, “Wow, okay, well, I’ve had the right relationships and was able to build them,” and since then, have gone on to, or continued to sponsor specific syndications as well.
[0:13:00.6] KR: Yeah, that’s awesome. It’s so funny to me, our journeys are just so similar. Just so similar, the path of just kind of going through this process of not – because I didn’t come from a real estate family either. The only thing I knew was that, to invest in real estate was to buy a single-family home and be a landlord, right? That was all I knew about. And then your eyes are opened up to this world of syndication, right? And the ability to invest with others that are more experienced and have better resources and are passionate about – I mean, you have the passion but some people just don’t, right?
Then being able to take that and then realize, “Wow, this actually works pretty well.” You’ve educated yourself to the point where you think, “Well, I could do it on my own,” right? Yeah, we’re running like parallel paths, it’s like looking at a mirror here, I love it.
[0:13:59.3] BK: Exactly.
[0:14:01.3] KR: Talk to me a little bit about, you know, we talk a lot on this show that the sponsor is the most important thing. More important than the deal, you’ve got to be with the right sponsor, like you said, the sponsor is aligned with you and your thinking and your values. How do you vet a sponsor that you’re going to invest with, again, from thousands of miles away?
[0:14:22.6] BK: Yeah, this, I think, is in my opinion, as a long distance investor, someone who is going to do it successfully, this is the secret sauce. I’ll just tell you a quick story before because I didn’t realize how important that was in the beginning because as I mentioned, I had money, I was looking to buy a property. I had money, I was looking to buy a property so I bought the property. After I bought the property, things were going well so I bought more properties and then I bought more properties and then all of a sudden, all this money was coming in and I was like, “Oh my gosh, this is the most amazing thing.”
Then I learned about this concept that I think I read about but it didn’t really make a lot of sense at the time but it was called deferred maintenance and issues and this and that and all of a sudden, I was like, “Oh my gosh, who is going to fix this?” I called and I didn’t have the team in place and so I was calling a handyman who then called a plumber and then who called an electrician and all these, other kinds of things.
Then I realized, maybe I’m not in the right type of location because all these different things are happening and I don’t really have a team but the one thing that was aligned was really what I was looking for and that was cash flow. One of the things that I now talk to and teach my students is, “Hey listen, first of all, it’s about understanding what is it that you want from your own personal philosophy,” right?
Which is, are you looking for cashflow, are you looking for privacy, are you looking for appreciation over time, do you need tax benefits? And then once you’re crystal clear on what it is that you want to be able to achieve through investing in tangible assets, then go to the location that actually makes the most sense for those types of goals. Once you’re in that location, if you love appreciation, maybe you want to go to New York or you want to go to San Francisco.
If you like cashflow, well then maybe you want to go to Columbus, Ohio or you want to go to a different city. If you like tax benefits well maybe you want to invest in some other type of tangible asset that’s going to give you even more benefit.
Then the third part is absolutely the key, right? This is where the team comes in, the team understands the location. Because then afterwards, whether you buy a property that is a 300-unit apartment complex, a self-storage facility or whatever the opportunity is, everything is aligned, right? That is the key. If we come back to the third point which is really understanding the team, Kent, I always think of the team, it’s like any relationship.
I’m married, I’ve been married now for a little over 12 years and the thing is, I didn’t meet my girlfriend at the time and get married to her the next day, right? It didn’t happen that way. We met, we talked, we had things in common, we understood one another, we had a great time together, we needed to talk about things that were serious, we talked about things that were serious, we spent time going to lunch together, we spent time having breakfast together, we walked together and we invested time to make sure that well, you know what? We wanted to start to make our relationship even more serious.
Then eventually, over time, when we decided we needed – we wanted to or we needed and wanted to get married. It’s the same thing with understanding your team members and vetting your team members, right? You’re going to need to do work upfront. I mean, specifically, if you don’t have a referral, right? Even if you do have a referral to a specific team and a specific location, you have to do the work, you have to be clear on what it is that you’re looking for, what you want your capital to do and then it can be as simple as – I’ll give you some really tactical kind of steps, right?
When you find out about company XYZ who is a strong operator in the right location, guess what? Everyone’s best friend is Google. Google them. Find out what their rating is with the Better Business Bureau, understand what other people are saying about them in their specific reviews.
Don’t only look at the things that are negative in the reviews, right? Because people, just human nature, we tend to write about things when they’re negative, but it’s really about being able to dig in, understand what’s happening, and then you know? You probably want to pick up the phone or get on a zoom session or whatever the case may be to start that interaction.
This is one of the things that I think is really important because if you’re doing all of the work and you’re not getting the right response from the operator, maybe it’s not the right operator for you or maybe it’s not the right syndicator for you.
Then from there, you should be prepared to ask them a number of questions that should be related to the things that you are trying to – the benefit that you want to derive from the real estate. Check that they understand the location, what are some of the different drivers in the location? Just talk to them about all the different things, what’s the net migration, what are the different companies that are there? Then be really specific on the area that you want to invest in and just test their knowledge.
If they’re not giving you the knowledge that you need, or that makes you feel comfortable, guess what? It’s probably not the right fit for you and that’s okay. Just keep picking up the phone and go to the next person, next person.
One of the things that I say also too is as a long-distance investor is, when you’re ready to place your capital, right? You’re thinking about placing $100,000 in a specific type of opportunity, well, speak to the syndicator and speak to the operator, if they’re two different people. One of the things that I’ve also done is, when it makes enough sense, you have to put your money where your mouth is and actually go and travel to see the operations or ask about the operations or maybe use technology to see what the operations are like. Things like that, just so that you feel comfortable with where you’re getting ready to place your hard-earned capital.
Then from there, it’s to have the dialog and then once you feel comfortable, you do that hundred thousand or $200,000 wire transfer and then you be prepared for the return on the promises that were made. Maybe it’s probably a little bit of a long-winded answer but hopefully it gives some very specific tactical things that people can do to really vet a specific team.
[0:19:48.3] KR: Yeah, I appreciate the detail there. I mean I think you just summarized, or you’re talking about, which I think is such an important step, first is understanding your goals, right? Your personal goals. Because I think a lot of people go into it and they just kind of skip that part, right? Well, what’s your goal? I want to make some money. It’s like, “Well, okay but it gets more detailed in that,” right? First getting clear on your goals, what are your objectives?
You talk about making sure, then you can make sure that your objectives and your goals align with the sponsor, right? I love what you said about markets because markets are what drives a lot of the different strategies, right? There’s markets that are better for appreciation and building wealth and net worth, right? There’s markets that are better for income and cash flow, right? I think along this, the undertone that I heard was you’re continuing to educate yourself, right?
You’re not just taking like a backseat and just reaching out and saying, “Okay, I’m going to kind of just trust whatever this person is saying.” You are educating yourself, you’re learning about the markets, knowing the markets you want to be in, finding sponsors proactively in those markets.
And then you know the questions to ask, right? You know, coming up with those questions. I think that is such a good process to go through to make sure that you’re with somebody that you want to be married to, right? Because when you’re in what can be a five-year relationship, you want to make sure that that’s going to work out for the long run. Now, I appreciate walking through that and I appreciate the tactical steps that you shared.
[0:21:21.4] BK: Yeah, can I add one thing to that, Kent, as well?
[0:21:23.5] KR: Please do.
[0:21:23.8] BK: Because I know we are talking to a lot of passive investors and it’s really important to recognize that even when we talk about passive investing, you’re not passively investing. You need to do work to make sure that there is an alignment. You talked about it in the very beginning like, there needs to be alignment to make sure that you have the highest probability of achieving the goals that you are looking for with the team that you are, in essence, placing your capital and you’re placing your dreams and you are placing your hopes and your future with, right?
Because to your point, it’s a five-year relationship, so there is not really – if you just look at it and say, “Hey listen, I just want to get this. I want to put my money here because on paper it says I’m going to get the highest return.” Okay, well, if someone puts a 25% return on a piece of paper, are you just going to place your capital there? Do you understand the risk proponent that’s there? Do you know that the team actually understands the location that they’re investing in?
Do you understand the different types of maybe insurance policies that are in place that are going to protect your dreams, your future? This is why I say it’s really important for you as a passive investor, someone who is investing your capital and allowing someone else to do the work, is to make sure that you’re going to be able to sleep well at night. There is nothing better than sleeping well at night and I know, Kent, you’re similar, like I don’t sleep a lot man, but the very little bit that I do sleep, I want to sleep really, really well at night.
I know that most people want to sleep well as well and so it’s about making sure that you do the work upfront so that later on, you can sleep very well for the next five years.
[0:22:53.4] KR: Absolutely. What are some things, because you have invested, it sounds like with numerous sponsors, so you have invested with a few different folks, right? What are some of the things that, when you’re in the deal, those sponsors have done well to help you sleep better at night?
[0:23:11.0] BK: Communicate. Without a doubt, it’s communication. I have invested passively in deals that it’s been three and a half years and I have seen zero return on the capital that was placed, right? I think that’s also one of the other things that you need to be aware of is the fact that not every single syndication is going to be a home run. What, it goes back to the team, is to be able to understand that the team is aligned with what you want to be – what you want your capital to be able to do.
In those moments that are difficult, the most important thing is that the sponsors are in front and talking to you in a transparent way. Sometimes you have to deliver news that’s negative news. I mean that’s just part of it but don’t put your head in the sand and just think that your passive investors are going to understand that because that’s going to create nervousness, the unknown is the biggest fear factor or that generates the most fear.
As long as your sponsors are explaining what is happening, why it is happening and what they’re doing to minimize the risk or the negative impact, it’s difficult to ask more of them but that’s why you do the work on the front end to understand what is happening. I mean, I’m investing in a hotel that opened in October of 2019, who would have known? It takes a couple of months for it to get up to going and then hey, listen we have a global pandemic and guess what? Hotels are shut down.
What are you going to do? Afterwards, it’s how is the sponsorship team staying in front with communication? And that could be formal communication. That can just be picking up the phone and saying, “Hey, look Kent, we’re doing XYZ. This is what’s happening. This is how we’re protecting the capital. We’ve applied for XYZ number of loans or PPP,” or whatever the case maybe, right? But it’s to stay in front of it with the count, with the communication.
It is also to make sure, and just to reiterate to everyone that not every syndication is going to work out in the way that it was penciled out. It’s just part of it.
[0:25:13.3] KR: Right. In our firm, our head underwriter, he has a saying. He said, “You know, every proforma is wrong, it’s just your best guess but you’re never right on, you’re either better or your worse.” Because when you are creating that proforma, that underwriting, that’s when you know the least information about the deal and about the property. As you get in and you really get your hands on it, you learn more and you update and do things but yeah, I think that’s exactly right.
You’ve got to know that it’s very easy, I love what you said, it’s very easy to put 25% return on a PowerPoint presentation or even an Excel spreadsheet, right? You can make the Excel spreadsheet say whatever you want but you get to what’s the probability of that return, right? I think that’s where the systems and the track record of the sponsor really come into play and where having a good sponsor is so important.
You used a baseball analogy of like the homerun. The thing that I try to tell people is look, we’re trying to hit singles and doubles. We don’t aim for home runs because home runs don’t happen very often. You think about a guy like Babe Ruth, right? He led the league in home runs. He also led in strikeouts, so you were just trying to get singles, doubles and stay on base, you know? You keep going around the bases and I think that’s the right way to think about it.
You’re investing from afar, you’re actively investing, you’re passively investing. For folks that want to do the same, maybe not in other countries, but even just investing out of state, are there tools that you’ve learned along the way, tricks, tools that can help people do that better?
[0:26:56.9] BK: Yeah, absolutely. I always like to keep it as strategic as possible in this regard, right? Because I think the tools change all the time. However, Kent, you and I, you know, you’re leading a syndication. I found about you because I saw you on the Internet and you make it really easy for me to reach out to you so guess what I’m going to do? I’m going to reach out to you and I’m going to find out and you give me some of your time.
I’m going to get on a phone call and when I get a chance to see you, like if I were in the same physical space, we’d probably meet up at a Starbucks or in your office for a cup of coffee and a great conversation. Well, when you’re thousands of miles away or thousands of kilometers away, however you want to look at it, we leverage technology. You made it easy for me to get in touch with you, I reached out and we’re on a Zoom or Skype or whatever that medium is, so that we can get a chance to know one another.
Afterwards, we both have email, so guess what? We can continue to communicate with one another in email form. Eventually, if I want to continue in your world then I’m going to say, “Hey listen, are you doing anything? Is there any way I can stay up to speed in what you’re doing?” and guess what? You have a way for us to stay in touch through your email automation and so we’re staying in touch that way and all along the way, it goes back to what I was talking about before.
We’re developing a relationship because eventually, once it makes sense for the two of us, that’s when we get together and we put all the different feelings that we have and we put it on a sheet of paper and that can be an operating agreement or a private placement memorandum or any of those different four or five documents that we sign and then we formalize that later but the process is really just to get to, first of all, know you, then go through the process to get to like you and then trust you with my dreams and with my goals in the future.
Then we can use the different technologies that are there, everything from email to video conferencing to the phone or to Wattsapp or whatever the case may be, that’s going to help to facilitate us strengthening that relationship overtime.
[0:28:51.8] KR: Yeah, I know, very good. What you’re describing as you said, it’s just these multiple touch points, right? Taking the time to build that relationship and build that trust, very cool. It’s kind of funny, just in the world that we live in now everything has gone virtual anyway, it just seems to me like so much more approachable. Like you investing from afar really is no different from really how I would communicate to anyone else these days, right? It is so much more approachable I think.
Before we get to our keys to success, I gotta ask you because I saw this in your bio, you speak five languages.
[0:29:30.0] BK: Yes, I do.
[0:29:32.4] KR: What are those languages?
[0:29:33.9] BK: I speak Spanish, I speak Catalan, which is the language that they speak where I live here in Barcelona. I speak French, I speak Italian and I speak a little bit of English.
[0:29:45.3] KR: A little bit of English on the side, on the side, right?
[0:29:50.4] BK: When I have extra time.
[0:29:51.9] KR: Right, so how does somebody go about learning five languages?
[0:29:56.7] BK: I started at 27, right? It wasn’t that I really spoke the languages before. Actually, it’s a lot easier today Kent because of technology. I mean you can sit and listen to YouTube videos in whatever language you want all day every day and just get your ear attuned to it but when I started, I took a very traditional approach. I mean I had taken Spanish in high school and college and ended up getting a degree in Spanish so maybe I was a little bit further ahead there but it’s a very different situation when you are learning it on a piece of paper and you have time to think and memorize versus just having an interaction like this.
The biggest thing is just to put yourself in the situation. Now, I did it physically, moving to the country. Like I lived in France for two and a half three years. I’ve lived in Italy and I’ve lived in Spain for the last 15, going on 16 years, so I’ve been through those situations where, like I said earlier, I was frustrated. I was crying in my very small studio not because I didn’t feel like I could do it but it was just frustrating when you are just trying to get your lights turned on and people don’t understand. Because this was the mentality that I had, it’s like people don’t understand that I’m trying to speak to them.
It wasn’t that, it was that I still hadn’t achieved the level for them to understand me because I was actually in their home town and so a lot of it goes, and this is what when I talk about language and also understanding the culture, and so you start seeing some of those things in that evolution and one of the things I do today, when we’re selling software, is when you are able to sell multiple millions of euros worth of software and that you are doing it in a different language that’s not yours and you’re working with cultural norms that were not the ones that you were born with, it really helps you at an individual level to recognize the growth.
Do I speak any of those languages natively? No, but most people, when they hear me they’re like, “Well, you don’t really look Spanish or you don’t really look Italian.” I’m like, “What do you mean by that?” Like, “Okay but you sound it,” and so it’s just being there and assimilating and learning and making a whole lot of mistakes. Man, I have made millions of mistakes linguistically. Each mistake gives you the opportunity, especially when you surround yourself with the right people, locals, natives, they help you improve. Just like real estate investing. I mean it’s the exact same thing, you’re going to have to make a lot of mistakes to get to the point that you want to eventually arrive to.
[0:32:21.0] KR: Yeah, cool. I just had to ask that question because that is still a personal goal of mine, is to learn another language. I knew a little bit of Italian at one point back in the day because I studied abroad in Italy but it goes fast when you are not using it all the time.
[0:32:35.6] BK: Definitely, well podcasts have helped a lot with that, right? A lot of your audience will know that because they’re here and they’re listening to you, they’re watching you constantly and they wanted every once in a while just take 10 to 15 minutes of another audio in Italian language, you can do that and when you’re on your ride to work or something like that or wherever, meeting up with friends.
[0:32:53.7] KR: Very good, very cool Billy. Well, let’s move on to our keys to success. Four questions I want to ask you. First one is, what is the one question, if you only had one question, that every investor should ask their deal sponsor?
[0:33:09.5] BK: I would ask the deal sponsor, similar to what you mentioned earlier, but tell me about the least performing deal and what happened, what did you do with that? I would leave it very open just to see, okay, did they have any deals that didn’t work out? If they do then what did they do to actually do whatever? And I don’t want to give like the answers but it depends on what they say and just leave it a very, very wide open question but most people don’t want to talk about the things that did not work. But when you’ve done this long enough, you recognize that there are moments and there are times and there are things that do not work in a syndication and how do you react to that.
[0:33:50.6] KR: It’s a really good question for a couple of reasons. You know, one is gauging honesty. Are they going to tell you about it? If they truly have something that’s gone wrong, they probably haven’t been doing it long enough, and you need to ask about track record. Because real estate, the way I look at it is like real estate is about solving problems, right? Problems are going to come up, it’s, how do you solve them and how do you move past them, right? I think that’s a really telling question.
[0:34:17.2] BK: Yeah, it is. Definitely keep the question open just to your point right now, right? Because if they don’t tell you one thing, maybe they haven’t done enough and when I say they, I’m talking about their team, right? Because as you know, Kent, and as all of your audience knows, it is not just about one person, it’s about the team and how the team react to that syndication that didn’t go according to plan.
[0:34:38.1] KR: Definitely. What are you most proud of in your career?
[0:34:41.7] BK: Today, the thing that I am most proud of is that I continue to move forward and I’m doing that while I still like my day job, right? Because there are some times where you could – where I could have just said, “Well, I’m not going to keep following my dream because I’ve got a really well high paid W2 equivalent,” right? The fact of the matter is that I have, for a number of years, seven years, continued to forge forward and have not stopped. That’s the thing, if I have to take a second to think about it, yeah, that’s the thing that I’m the proudest of.
[0:35:19.3] KR: Awesome. What books should everyone read?
[0:35:21.7] BK: Without a doubt, the book I think everyone should read, this is a book that absolutely changed my whole world and the way that I perceived currency and it is a book written by, the author is G. Edward Griffin and the book is called, The creature from Jekyll Island.
[0:35:41.2] KR: Yeah.
[0:35:42.5] BK: When I heard about it, I thought, “Well, Jekyll and Hyde, what is this all about?” And so, when you realize what happened to the world in 1913 in this little island off the coast of Georgia, when a whole bunch of people got together from different places on the east coast and created this thing called The Federal Reserve, it just completely changed my perception of the world and I think for those people that invest time to read that book, not just once but multiple times, it is something that will really help you to understand the importance of well, just central banks, debt and currency in general. Yeah, that for me is without a doubt, The creature from Jekyll Island.
[0:36:27.0] KR: Yeah, it’s a really good book and I think it opens up your eyes, it helps you see behind the curtain a little bit, how things work and kind of how things started, so yeah really good book. What is your number one key to success?
[0:36:40.3] BK: Keep moving forward. Keep moving forward. I was going to say take action but keep moving forward because there are moments, Kent, and you know this man, whether you’re a passive investor or you’re an active investor, when things – you have this moment where you can just collapse and do whatever it is what you were doing before, go back to what you were taught early on, especially if it is the conventional traditional things and really, it is about continuing to move forward.
Just continue to progress even if it’s just a little bit, just push yourself, have your team push you, have your team to just keep moving forward.
[0:37:19.1] KR: Yeah, awesome. That’s a great tip, just always improving right?
[0:37:23.1] BK: Yeah. Yeah, always.
[0:37:24.4] KR: Great. Billy, thank you so much for being here today. You are actively syndicating your own deals, right? It sounds like you’re coaching. If folks want to reach out to you and learn more, how can they get a hold of you?
[0:37:37.8] BK: Kent, if you’ll allow me, I’ll give people a couple of different ways because everybody kind of works in different ways.
[0:37:42.5] KR: Please do.
[0:37:43.0] BK: For those people who just want to reach out and say, “Hey look, I want to talk to you. I want to understand more about long distance investing,” maybe you live in one part of the US and you want to invest in another part, let’s get on the phone. Just go to bit.ly/speakwithbilly, 30 minutes of my time, no strings attached. It’s just my way of being able to give back.
I love LinkedIn Kent, as you know, so I would say also reach out to me at LinkedIn. Let me know also too that you saw Kent and I speaking here. He and I would both appreciate that. For those people that want to hear like twice a week really long distance investing stories from the best experts in the business, you can go to the – also check out The Going Long Podcast with Billy Keels. You can find it on most major platforms on YouTube and stuff like that. And if you just want to check out what we’re doing, just go to billykeels.com and then one last thing, if you interesting in picking up an eBook that talks about my journey and long distance investing, you can go to growyourmoneythesmartway.com.
[0:38:40.8] KR: Right on man, you got a lot going on but it sounds like you’re an easy man to reach, whatever your preferred preference you can get a hold of Billy.
[0:38:49.2] BK: Yeah, we try to make it easy.
[0:38:50.0] KR: We’ll make sure all that’s linked below, so if you want to just scroll down, you can find your preferred method.
[0:38:56.9] BK: Thank you very much for the invitation. I really appreciate the opportunity to share a bit of my story and I love what you’re doing here man. You’re just rocking it and you’re building a wonderful community, so thanks for letting me be a part of it.
[0:39:07.7] KR: Absolutely, thanks for adding value today. It was a pleasure having you on the show.
[END OF INTERVIEW]
[0:39:12.4] KR: Thanks for listening to another great episode or Ritter on Real Estate. Hit the subscribe button to make sure you don’t miss out on the content that will make you a better investor. Also, visit kentritter.com for articles, videos and tools curated just for passive investors. Until next time, this is Kent Ritter on Ritter on Real Estate. Now go out and invest like a pro.