From Taking 2 Years To Your First Deal to 1000 Units With Matt Picheny

Matt Picheny: [0:00] And I'm, like, talking with people who are in the group, and it took them, you know, a year and a half or they've been in the program for two years, and they haven't gotten their first deal. And I'm sitting there going, all these guys are slackers. Like, they're not really committed. And I'm doing this full time, and I'm totally committed. And I'm gonna just, you know, really be successful in this. It took me two years to get my first deal.

Speaker 2: [0:23] Welcome to the Collecting Keys Real Estate Investing Pod podcast with your host, Mike DeHaan and Dan Austin. From wins, losses, horror stories, and tactics for optimizing your business, Mike and Dan take a real uncensored deep dive into the ins and outs of running a full time real estate investment and wholesaling business.

Matt Picheny: [0:46] What's going on, guys? On this episode

Mike DeHaan: [0:48] of the collecting keys real estate investing podcast, we have Matt Picheny. Pichaney. I've nailed it that What's that say? Pitch in. That's the in. Pichenney. Pichenney.

Dan Austin: [0:59] It's not a

Mike DeHaan: [1:00] time. So I've now fucked it up twice. So you guys are gonna jump into it, and you're gonna hear me say it wrong again. So I'm keeping this for authenticity. Matt Picheny. And he is a Tony award winning actor turned into big time syndicator. He owns 10,000 units. I have massive respect for him for opening with 10,000 units and saying, but listen, I'm only in GP in 4,000. The other 6,000, I'm a private investor because that is, like, the biggest Yes. BS sort of, like, flexing stat that a lot

Dan Austin: [1:30] of We could all go in 10,000 units if we just became LPs. Exactly. If you

Mike DeHaan: [1:34] just go become become an unlimited partner and you, like, silently invest in a bunch of stuff. And if you're rich, it's like really not hard to do. But this guy's grinded and become an actual like principal investor in 4,000 units that he has built up over just seven years and doing like big boy deals. Like, the end, he he tells his with his crazy story of his episode, he talks about a $52,000,000 purchase that almost went wrong and, you know, really gets into, like, levels of money and, like, white collar Yes. Machinery that, I guess we don't really see on the residential side.

Dan Austin: [2:04] Too, what was great about this episode is there was literally nothing complex. It was he's a very simple strategy, like, how he did this, and it was just putting the legwork and being consistent. And I think his advice on relationships and how important they are to, like, your overall success is absolutely spot on.

Mike DeHaan: [2:21] Yeah. Yeah. Exactly. Just the definition of keeping it simple, doing the same thing over and over again. And, you know, spoiler, it took him two years to get his first deal when he started in a multifamily game. So it's not like he had some big win off

Dan Austin: [2:35] the bat. So many people would have quit after six months.

Mike DeHaan: [2:38] After two months. After a week. Honestly, yeah. It's crazy. So really, really enjoyed chatting with Matt. Definitely check out his website and reach out to him. Super nice guy. Hop and chat with people. We'll meet when he brought him on the show and said, what do you wanna talk about today? He said, all I wanna do is bring value. And he definitely did that. So if you got any value from him, reach out, let him know, and engage with him because he would love to hear from you. Yeah. He's a great guy. I know he'll get back to you. Yeah. Absolutely. So besides that, guys, please go in, share this podcast, anyone else who might find it interesting. It is the easiest way for us for this show to grow as if you go and you share it with your sphere. So any way that you can do that is gratefully appreciated. Aside from that, guys, enjoy this interview with Matt Piccini. Got that time.

Dan Austin: [3:24] He did get it. Enjoy.

Mike DeHaan: [3:27] Alright. On the show today, we have Matt Picheny. No. I think I said it right again. I

Matt Picheny: [3:33] did did I get wrong?

Mike DeHaan: [3:34] Picheny. Picheny. Picheny. Oh, okay. Okay. Yeah. Well, literally talked about it before. Picheny. So I apologize for that. I even practiced and still mess it up. But Matt Pacheni, thanks for coming on the show, man. Appreciate you taking the time.

Matt Picheny: [3:49] Oh, it's my pleasure. Thanks for having here me here, Mike. And Dan, I appreciate being a guest here.

Mike DeHaan: [3:54] Yeah. Absolutely. So I'd love to dive into your backstory and kind of all the stuff that I guess you've been working on. You have, I would say, a pretty dang fascinating I almost said, rags to riches because you were doing stuff. You weren't, like, homeless. But the finance turnaround and the lifestyle turnaround that had through real estate is one that's really, really impressive, really be admired. So I'd love to sort of hear about your background, where you came from, and everything that you're working on now.

Matt Picheny: [4:18] I was, like, technically homeless, but I mean, seriously, there was a there was a time there where I was couch surfing at friends' houses, but that's because I used to be an actor. So, you know, that that's really you know, I grew up in Orlando, Florida, moved to New York City to become an actor, and I used to go off on tours. And so I didn't make a lot of money back then, and it didn't make sense for me to have an apartment in New York City and pay rent if I could just have no place to so then when I would come back, I would have to couchsurf for a few weeks or months until I found a new living situation. So, technically, you know, but not really. Not not like living out on the streets, which is a real serious thing. You know, I I had done that and started doing some computer work on the side as a hobby, and I had an opportunity to to really start my own company doing website development and digital marketing. This is back in the nineties, right? So we're talking about like the mid to late nineties, the .com bubble was there, right? And everyone was doing digital marketing and building because nobody had websites or was building their first websites. And and that's what I did. I did a lot of that kind of work, and I ended up starting my own boutique agency. So instead of waiting tables at the Hard Rock Cafe in between acting gigs as I had been doing, I started doing some digital marketing work, and then so much work was coming in. I started my own agency and that things are going great until around 2001 when the dot com bubble burst. And all of my clients were going out of business, and my business just completely imploded. I was just in really bad shape.

Matt Picheny: [5:56] My clients either went out of business or just weren't spending money on digital marketing. And at that time, I got a call from my landlord and he told me that I had ninety days to get out of the apartment that I was living in.

Mike DeHaan: [6:09] I mean, ninety days, Lisa gave you that. In some states, he'd give you like two weeks.

Matt Picheny: [6:12] Yeah. At least give me ninety days. But, you know, I in New York City, with no real job or income, like, how do I find a new place to live? And it seemed like a really, really daunting task, you know, while the whole digital marketing world is falling apart to to figure out what am I gonna do next. I ended up getting a job working for one of my clients, Showtime, the cable television channel, Showtime. So I went there. And instead of renting an apartment, which is which is what I had initially looked to do, I actually found an apartment that I could buy. And it was all the way up, up, up, Upper, Upper West Side Of Manhattan, an area called Washington Heights. So not really my desired place to live, like much further away, but it was affordable. And a little over two years later, I ended up selling that apartment and seeing my down payment, my initial investment in this property more than quadruple in value.

Dan Austin: [7:14] That's pretty sweet.

Matt Picheny: [7:15] And so that was a big

Mike DeHaan: [7:16] That's awesome.

Matt Picheny: [7:17] Yeah. It was a big light bulb moment for me. I was making a good salary at this point, but in that one transaction, I made more money than I made in a whole year's worth of salary. Right. So I was like, Woah, how can I make that happen again? And that's when I started to get involved in real estate. You know, a couple years later, I bought my first investment property, which was actually a piece of raw land that I then built a house on. It was vacation rental home, and then I got involved in some some single families, and I did some some fix and flips. And then ultimately ended up doing what I do now, which is getting involved in multifamily. And I do multifamily syndications. So, you know, I did real estate as a hobby for ten years and then turned that into a full time job about seven years ago. So I've been doing the real estate stuff full time for for seven years as an investor. I've got a large portfolio over 10,000 units that I have ownership in. Partial ownership, I don't own all of those outright. And two thirds of that portfolio are deals that I am a passive investor in. So limited partner just investing in it. Don't really I'm not really involved in the day to day. But I do have a third of that portfolio, almost 4,000 units now that I am active. I'm a general partner on. I I sponsor those deals, and I am involved in those on a on a daily basis.

Matt Picheny: [8:40] So that's kinda the the nutshell story.

Mike DeHaan: [8:43] Yeah. Yeah. I love it. There's a there's a lot of good stuff to unpack there. And one thing that I think is really interesting so the background that you started with doing the web development, I I feel like the the fact that you're able to be somewhat successful with that probably directly contributes to how you were able to scale into this multifamily stuff. Because you have those entrepreneurial roots, it sounds like, kinda from the get go. If you were running this web development business, and you were also doing it in a time where that was hard to do in, the nineties. Know, it wasn't like you were going and making, like, a WordPress website. You were actually having to code and do stuff custom and manage the servers

Dan Austin: [9:17] and all that sort

Mike DeHaan: [9:18] of stuff. So I'm sure that you developed a lot of problem solving sort of skill sets and ways to learn to get into complex problems and sales and all that sort of stuff. That something that kinda came naturally to you, or was that all just like you saw an opportunity and you learned how to learn that?

Matt Picheny: [9:36] I think a little combination of both. You know, I mean, my my real first career was was, you know, in the theater as an actor for five

Mike DeHaan: [9:43] years. Mhmm.

Matt Picheny: [9:44] And there was a lot of sales that's involved in that as well. Right?

Mike DeHaan: [9:47] Agree.

Matt Picheny: [9:47] Yeah. A lot of facing rejection and just keep it going and going and going and going and being able to sort of be adaptive. And also in between acting gigs, figure out how are you gonna make ends meet and what kind of jobs can you do. And can you be nimble and can you be scrappy? Right? So I had to do that. And then yeah. I mean, I think you're right when it comes to the the digital marketing stuff as well. And it was it was I was coding HTML by hand and JavaScript and figuring out how to integrate cold fusion and flash. I mean, those technologies don't even exist anymore. I mean, I don't think cold fusion is around at all. Flash obviously went away a long, long time ago. But back in the day, that was all the rage. Right? So Yeah. Yeah. It was it was a steep learning curve.

Mike DeHaan: [10:33] Wow. Yeah. That's awesome. There's three things, three different occupations that I've see that we see regularly lead to people getting into investor. Like, people that are successful investors, they come from these different backgrounds. And one of them is sales, obviously. People know how to sell. People know how to get rejected, those sort of things. That's a big one. The other two, which are sort of less intuitive, a lot of people in the medical field we see come over. And I one theory with that is that they, you know, they make good money, but I also think it's because they are used to just putting up with outrageous situations. You know, like, have, like especially if they work in, like, ER or trauma or things like that. And you're just like, you're at a point where I cannot believe that I am removing something from a human's body yet again. Right? So you're more accustomed to this outcome with real estate. But the other one is engineering. Yes. And, you know, people that are very systematized and learn how to learn processes and, like, the technical nature of engineering and development really translates well to real estate. So, you know, that's you know, I guess you're sort of helping support my hypothesis that if someone potentially wants to get into real estate, you know, science and engineering I love

Dan Austin: [11:42] that's a good hypothesis supporter too.

Matt Picheny: [11:44] In my experience at speaking with other people who are real estate investors, I see engineers as number one.

Dan Austin: [11:51] Yeah. Tons of money. I think it's just because it's like, all the time. Spreadsheets and real estate seems to always start in spreadsheets and we're all like, oh, yeah. Look at this. Mhmm. You know, these numbers work.

Matt Picheny: [12:00] You know, I I never considered myself an engineer, although I did do some programming. But as I advanced in that career and got involved in the digital marketing world, starting with my time at at Showtime. When when I was at Showtime, sort of transitioned more from programming to project management. And I love spreadsheets. And so I'm like, now I'm a I'm a PMI certified project management.

Dan Austin: [12:24] Okay.

Matt Picheny: [12:25] That's what I did manage people, budgets and timelines. And so when I transitioned over to doing real estate full time, it was really taking those same skill sets and all those same processes and just moving them over to real estate instead of marketing. You know, it's the same kind of thing as what you're saying, you know, just really loving spreadsheets, being process oriented. Yeah, I think it lends very well to managing any business, but definitely real estate.

Dan Austin: [12:53] Yeah. Yeah. Absolutely. And it's funny because like Mike and I, we are both engineers, but also you learn in our business, like, what other skills you need to have. Like, being able to run numbers is amazing, but then you also have to figure out how to find deals. Yeah. You know? That's a different problem to And then you have to acquire those deals. You have to sell people. You have to there's all these other skills. But if you have one really good one, you can get quite far with it. But you as you if you wanna, like, keep to grow success where you have 10,000 units under manager, you have to layer on a few other skills.

Matt Picheny: [13:23] Yeah. You have to layer on skills, number one. But number two, you could also bring people in as partners

Mike DeHaan: [13:29] I know.

Matt Picheny: [13:29] Who maybe compliment you really well.

Dan Austin: [13:31] Love that.

Matt Picheny: [13:32] That's something that I've been able to do that's been very helpful in terms of, like, the acquisition. I mean, some of the deals that I have are through relationships I've developed with property managers and with brokers. But I have partners that I've worked with that I've brought in on some deals that I found, and they've brought me in on some deals that they've found. And so it's been a nice sort of symbiotic relationship. And honestly, like acquisition, I'm very good at underwriting, but going and meeting with all the brokers and Yep. Shaking hands and coffees and schmoozing, all that kind of stuff is not I mean, I'm fine at it. I can do it, but I don't know that I love spending my time doing that. Right.

Dan Austin: [14:10] Yeah. Based to

Matt Picheny: [14:11] have other people maybe focus more on that and I

Mike DeHaan: [14:14] can focus on other things.

Dan Austin: [14:15] Absolutely. That's that's great. Absolutely.

Mike DeHaan: [14:17] Yeah. That's a perfect segue back into the the real estate stuff where you mentioned that you kinda got the bug from selling your first apartment that you had, which I feel like is how most people kind of Yeah. Get their introduction to real estate. You know, you buy your starter home. You all live in it for five or six years. You sell it, and you're like, wow. I just made my salary or more, you know, off that that asset that we purchased. But going from there, you did the land development with a short term rental, which sounds like you just dabbled in that a little bit. But the transition into apartments, that can seem like a pretty big leap. And obviously, going from I have sold my primary residence, I've done an apartment rental to now I own 10,000 multifamily units. That is a you know, there's a lot that happened in between there. Right? So, like and that's not something you're gonna do alone.

Matt Picheny: [15:04] Right. There's so much. I wrote a book about it. You know I what I mean, there's a lot of steps that happen along the way. It wasn't like an overnight thing.

Mike DeHaan: [15:13] Yeah. So I guess how did that start? Like, how did you first sort of start getting into multifamily and, like, other people that were looking to do the same? Because I feel like residential investors especially, it always feels like a hurdle. And you go and you talk to most people, and they're like, oh, just like network and Yeah. You know, talk to brokers and do all these sort of things. And sure, that can be part of it, but that's also what everybody else is doing. So, like, what is the way that someone that really wants to seriously get into multifamily investing that I guess, what would you tell them to do? And, like, what do you think was helpful for you when you first started that journey?

Matt Picheny: [15:46] The thing that was really helpful for me is let me back up a second and let you know that, like, I didn't know how I was going to build a real estate business. I knew that I wanted to do that. I knew I wanted to grow it and scale it, but I had a problem. And the problem was I didn't have a ton of capital at the point that I was going ahead to do this full time. I owned a townhome in Brooklyn. It was not an inexpensive purchase, so I had a lot of money that I had put into there for a down payment and, you know, equity in there. And I also had a vacation home that I rented out, and that was in Connecticut. So I just I didn't have a ton of capital to deploy. And I had bought the place in Brooklyn about a year and a half, roughly a year and a half prior to this. I knew that the deal in Brooklyn would cash flow, and it did. We we ended up moving to Miami, and we rented to that, and it was cash flowing. But even before that, my plan was, Hey, can I do another one of these deals in Brooklyn? Because I knew at that point that I could rent. I didn't know it was called cash flow, I knew I could rent it out for more than I had paid for it when I had the two units. It was a two unit property. The thing was, I didn't have a down payment. So my plan at that time was, okay, I'm going to continue working in the advertising world for the next, like, five or six years, gather up enough money to have a down payment for another one of these and do another one of these things. Or I'd have to have some, like, rich uncle that I didn't know about buy and leave me billions of dollars. Brewster's Millions.

Mike DeHaan: [17:21] You ever

Matt Picheny: [17:21] see that that old Richard Pryor movie? But how am I gonna get all this money to do this? And when I we ended up moving to Florida. My wife got the school job opportunity, so we moved down to Florida. And that's when I decided to do real estate full time. And I was actually gonna do fix and flip. So I was gonna flip properties, use that money to either keep some of the flips or buy other properties that were good buy and hold properties, wanting to develop passive streams of income. Just tons of them, right? Massive amounts of little passive streams of income. And what happened was I started listening to podcasts, and this is many years ago when there was like literally no syndication multifamily podcasts out there. Now there's like a gazillion. Oh, yeah. Of them. But back in 2015, there weren't any. And at least I never found them. And so I was looking and looking to find out just about real estate. Was just learning about real estate, reading books, listening to podcasts, doing everything I could. And I was doing it full time now and I didn't really have a big portfolio. So I had a lot of time to spend on my education. And what I found on some podcasts, I heard someone talk about a thing called syndication.

Matt Picheny: [18:36] And I was like, wait, what's that? And it was somebody the guest had their own podcast. So I was like, oh, let me go listen to their podcast. And then I heard them at some point talk about syndication again. And I was like, oh, wow. Okay. What is this thing? And what it is is where a bunch of investors can pool their money together and buy a property that they wouldn't be able to do and on their own. And I was like, woah, bingo, like, light bulb. This is this is amazing. Like, this is what I need because I don't have that rich uncle and I don't you know, I'm not going to leave my wife and marry some rich old lady and hope she dies. So, like, well, how do I get, you know, how do I do this? And this is amazing. And I went to a seminar. There was, like, a weekend seminar. And so I, like, flew. I was in Miami. I flew to Dallas, which is where this thing was. I got a hotel. Now all these people who were doing this are you know, some of them were doing it. Some of them wanted to be doing it. And it was just an awesome community of people. And I was like, this is awesome. And some of the people that were in that group because this was more like syndication on a high level. Like, you can use syndication for multifamily.

Matt Picheny: [19:42] You can use it for assisted living facilities. You can set up funds. Like, there's many different things you could do. Actually, a lot of people don't know this, but most Broadway musicals are actually dug through syndications.

Dan Austin: [19:52] Fascinating.

Matt Picheny: [19:53] And so funny enough, with my background in theater and my wife, that's what she does full time. She's on the Business Center Broadway. We had invested in a few Broadway musicals, and they were syndications. We I just didn't know they were called syndications.

Dan Austin: [20:06] That's fascinating.

Matt Picheny: [20:07] All this syndication paperwork, subscription agreement, PPM, all that kind of stuff that you have in a syndication. I just didn't know that it was, like, a thing that was like called something.

Mike DeHaan: [20:16] Wow. So

Matt Picheny: [20:16] anyway, yeah, it's very interesting. So some of the people who are in that were in like one of these mentorship groups. And so there are several mentorship groups out there that teach you know, there's ones that teach assisted living facilities. There's ones that teach multifamily. You have to be very careful. So I'll just if any of your listeners are like, oh, I'm gonna join one. Be very, very careful about what you do and what you join. They're very, very expensive. Some of them are scams. Right? Yep. Some of them are not scams. I know people who've come up through the group that I went through and have been successful. I know a lot of people who went up through my group and are not successful. I know people who've done other groups and have been successful. So I think part of it is the group and part of it is you. For me, I I was like, I'm really driven. I've been successful. I'm entrepreneurial. I'm gonna join this group and I'm gonna kill it. And I'm like talking with people who are in the group and it took them, you know, a year and a half or they've been in the program for two years and they haven't gotten their first deal. And I'm sitting there going, all these guys are slackers. Like, they're not really committed. And I'm doing this full time and I'm totally committed. And I'm gonna just really be successful in this.

Matt Picheny: [21:28] It took me two years to get my first deal. Yeah.

Mike DeHaan: [21:33] Wow. That's yeah. That's commitment to be grinding for that long. Yeah. It is.

Matt Picheny: [21:36] And it's not an easy thing to do. But I went from a two family townhome in Brooklyn, and then I I invested passively in some deals during that two year period. But the first deal that I did as a sponsor that I brought out to a group was 132 units in Kansas. It's a $10,000,000 property. So, like, I did. I made a jump from going from, like, a two unit to 132 units, And that is definitely doable and possible. It doesn't happen overnight. It doesn't happen without a good group, like, support group behind you. I had a number of I look a little younger than I am. I'm I'm gonna be 50 in March. So, know, you at this point, I was already I was in my forties. So I had already had a career, and so I had a number of colleagues, people that I had worked with, and also friends and and family members who knew me, who knew I had been dabbling in real estate as a hobby for ten years,

Mike DeHaan: [22:40] who

Matt Picheny: [22:41] saw me doing this full time for two years as not sponsoring a deal, but investing in deals. I had over a thousand units, I think. Yeah, a little over a thousand units when I sponsored my first deal. A thousand units as a as an investor, as a limited partner. And I was very clear with everybody. I'm an investor. I brought on a very experienced copilot with me, another sponsor. We we both co sponsored the deal together so that I could have someone who'd been down that road a few times. We we had done 10 deals at the time that we did that first deal together. We've done a number of deals together since. And so that we were able to do it, but it's not like it's not like going from zero to 60 in three seconds. Like

Dan Austin: [23:28] So I got a side question. So it took you two years to find that deal, and you said you were also passively investing as an LP and other syndications. There any other real estate activities you were doing in that two year period to, like, maybe build more capital? Did you start were you flipping houses, or were you just strictly like, I'm finding the deal?

Matt Picheny: [23:46] So I had a nest egg that I had saved up from my career. Uh-huh. And it wasn't large, but I had a tiny little bit of capital to work with. But also, I was making money off of the the townhome that we had in Brooklyn. I was getting positive cash flow from that. The property in Connecticut was like breaking even, but we had also invested in a little musical you might have heard of called Hamilton. And so nice between the Hamilton and the property in Brooklyn and my wife having a full time job, we were pretty good. I did flip a couple of properties also while all of this was going on. I was sort of more at the beginning part of it, like the first year of that. I flipped a couple of properties. I made some money. I lost some money. Yeah.

Dan Austin: [24:34] Overall,

Matt Picheny: [24:36] I was net positive, but, you know

Mike DeHaan: [24:38] Yeah.

Matt Picheny: [24:38] I did lose I did lose money in the deal. But that wasn't so much to speak of. I also, at that time, as you know, I have that digital marketing background. I did a little bit of digital marketing things for for some people in Miami that I met. I would do like a oh, I can do some Facebook ads for you or Right. You know. So I put a little bit of stuff here and there. But once I got that first deal, I stopped all of that.

Dan Austin: [25:02] You just focused on that.

Matt Picheny: [25:03] And I did I did moonlight a little bit here and there with the with the marketing.

Dan Austin: [25:07] So then you're basically, I would it sounds like just super dedicated to that, just finding a deal. So what would you say in that category of looking for your first deal? Where did you spend most of your time, and how did you eventually lock up that first deal and get that under contract?

Matt Picheny: [25:23] So I first started looking for a deal in Akron, Ohio, in the Akron, Cleveland area, which is where I was flipping properties. I have relatives that live there. My cousin, who's, like, a really, really close friend of mine, lives there. And I was like, I knew the name I liked his neighbor. It was cute. And relatively I mean, they had they were in a they moved since, but they were, like, in in what had been their starter home. You know? So not, like, ridiculously expensive. I was living in Miami where, like, this is just prices are insane. Yeah. And so I was like, hey. This is a place where I feel comfortable getting involved in flipping properties because I can buy them at a relatively low price point and not, like, get too far out over my skis. So then I found out about syndication, but I was already there and had started making connections. So I was like, let me see if I can break into the multifamily space here. That didn't really prove very effective. I also was looking to do it closer where I lived, which was in Miami. I grew up in Orlando. My parents live in Orlando. So I was searching in the Central Florida area. Couldn't find any deals there that made sense. You know, now hindsight, I should have bought all of those things.

Dan Austin: [26:30] Of course. Of course.

Matt Picheny: [26:31] Yeah. But I'm who knows? I was being conservative with my underwriting. I felt that it was too aggressive. I ended up then exploring Kansas City. So, I mean, I was already like a year into this before I started even looking in Kansas City because I had spent a summer in Kansas City as an actor. I actually liked it. I thought I was gonna hate it. I thought I was gonna be sitting around watching corn grow. And I found out, no. Kansas City really is, like, a really cool, very metropolitan city because

Dan Austin: [26:57] I was

Matt Picheny: [26:57] stupid back then.

Dan Austin: [26:58] It was

Matt Picheny: [26:58] in my early twenties, so I didn't know anything. Kansas City is awesome. So ever since then, I was like I always had a soft spot in my heart for Kansas City, the city that I totally misjudged. So and one of my best friends, my college roommate, moved to Kansas City. So I was like, all right, are you noticing pattern here?

Dan Austin: [27:17] Oh, yeah.

Matt Picheny: [27:17] I chose markets where I kinda knew someone, you know, either my cousin or my parents, and I grew up there or Kansas City where I had a friend. And I started looking in Kansas City and deals there were sort of penciling out on paper when I was just from far away getting a couple of deals to just kind of look at. So then I said, you know what? This looks good. I'm going to start really targeting that market and spent a lot of time in that market meeting brokers and meeting with property managers. The reason why it took me so long I mean, I guess you could say that first year was a little bit of maybe a wild goose chase in terms of like the markets weren't right. Also, we had the birth of our second daughter, and, we moved from Miami to Boston at this point.

Dan Austin: [28:02] Oh, wow.

Matt Picheny: [28:02] So there was a lot of other things going on in my life because, obviously, like, three months before the move and the baby's birth because we moved very shortly after the baby was born. Like, obviously, things sort of slowed down for us because of that. And then after then the move and find a place for us to move to whatever. So Kansas City, though, I got to meet with property managers and brokers and establish relationships with them and build confidence.

Mike DeHaan: [28:33] Okay.

Matt Picheny: [28:34] As real estate agents, you know, they don't get paid until the deal closes. And so, I mean, I don't want to go into the whole ins and outs around it. But, you know, just think about trying to build a relationship with a property owner, finally get them to list the property, you list the property, you go through the marketing, you get offers, you know, you go through best of vinyl, then the contract and the contract is signed and then there's due diligence. And finally, you close them. And that whole process could be that that first part can be years of trying to build that relationship. Once someone says, yes, let's go. I mean, you're looking at maybe six, six to nine months from the very beginning to the closing. So these brokers are spending a lot of time and they want to get paid or they don't get paid until closing date. And they also want to do right by their client. And they don't want to bring a offer to a client with someone who's not gonna be able to close because Totally. It makes them look really bad in front of their client, like they don't know what they're doing, number one. But number two, they also don't get paid for all for, like, a year's worth of

Dan Austin: [29:37] work Absolutely. Or even Right.

Matt Picheny: [29:40] You have to gain the trust. Like, how is I gonna be able to talk to a broker that I just met and say, oh, yeah, I can buy a $10,000,000 deal, like, 132 units, no problem. Like, they're not gonna take me for face value on that the first time I meet them unless I have a very large amount of money in a bank account and can show them proof of funds or something, you know, which I didn't have. I was syndicating these deals. Now, by getting to know these brokers, going, doing property tours, getting to know people over time, then they start to get comfortable with me. And then once I did my first deal in that market, then all of a sudden, they were like, okay, he can really do it. He's done it.

Dan Austin: [30:21] So was that when you've, I guess, first started then doing this, you said you started talking to brokers, started talking to property managers. Basically, did you just start out like, hey. This property's listed. Is that how you started creating those relationships? And then maybe you're checking in with those brokers. There's like you have, like, follow-up system maybe you're using to stay top of mind, but also build that relationship with them? Because that's kind of what it sounds like you're saying is you had to build relationships with these key people, and then you had to build confidence with them that you could close.

Matt Picheny: [30:50] Correct. I think that you hit the nail on the head, Dan. I didn't have, like, a system. Uh-huh. What I did was I started going to Kansas City Okay. And meeting with people face to face. Gotcha. How would I find them? I would look online. Yeah. And then once I got there, when I meet someone, someone might refer somebody and it's sort of organically the circle kind of grew from there. But, yeah, I started off looking online for people, finding out who people were and meeting them. And then the next time I'm out there, try to meet them again. Hey, you want to go grab coffee? I'm going to be in town next week. I'm touring. You know, I said to broker a, hey, you know, I'm coming into town next week. I'm going to go see such and such property that broker B has listed. Know, we might make an offer on that while we're doing a property tour. But since I'm in town, you want to grab a cup of coffee. I didn't broker A's like, oh, wow, Matt Pachetti is like coming into town and doing property tours like you buying from broker B, who is my competition. Like, maybe I should get to know this guy. Maybe he's legit. Right? So in doing that and just getting to know them and not, like, being very honest and upfront about who I am, I never made any pretenses

Dan Austin: [31:59] I do.

Matt Picheny: [32:00] About anything, but I also was going into town to do a property tour, you know? I mean

Dan Austin: [32:07] Wait. So you're telling me is you didn't have to hire a rocket scientist to find a deal. You just had to put in the effort, the legwork, meet people, network with people, go out of your way flying there, in this case, to set up and having coffee and just putting it as you were putting the legwork for two years, and now you're, you know, 10,000 units later.

Matt Picheny: [32:25] Yeah. So I would say now I'm, like, almost 4,000 units later because the other ones are LP and that's

Mike DeHaan: [32:31] meant to

Matt Picheny: [32:32] have to do with the lab work. That It's

Mike DeHaan: [32:33] a lot. Still It

Matt Picheny: [32:34] was like the mentorship group and all of that stuff. And in the mentorship group, look, I learned how to underwrite these deals. It's like, oh, I just went out and met people, and then this deal fell out of the sky. Like, there was a lot of deals that I looked at, a lot of deals. I actually I counted the number. It's in my book. I can't remember. Was like 108 deal, 114 deals, something like that, before I got my first deal. Because I was getting really frustrated.

Mike DeHaan: [32:55] Yep.

Matt Picheny: [32:56] I was about, like, six months in a looking at deal, but maybe four somewhere between four to six months in a looking for deals, and I could not find anything. Right? Nothing was working out. And so I was like, I wanna know how many deals I've looked at. And so I created this spreadsheet because I'm a spreadsheet nerd. Right? Yep. And I went back and forensically put in what I had done, what I had underwritten. I probably missed a few here or there. And then I started tracking. So I had partial of 2016, all of 2017 and a partial of 2018. It was 2018 when I got my first deal. And so when I was writing the book, I like went back to that spreadsheet because I after I got my first deal, I stopped and I got it. I think it was like 104. Wow. I don't remember. It's in the book, but I think was a 114 units. That's not just deals that, like, came across my desk. That's deals that, like, I sat down and I underwrote.

Dan Austin: [33:48] Yeah.

Matt Picheny: [33:48] So gotten very good at underwriting just because of repetition. You know, you ride a bike a 100 times, you get good riding your bicycle. Yeah. Same sort of thing. And through the mentorship group, I learned how to underwrite deals. And I also would read that in books. I also when I moved to Boston, I took a whole course of studies there, actually two different courses of studies where I took lots of classes and I got certificates, one in real estate finance and one in commercial real estate, just to sort of fill in any gaps that I maybe did catch on all the podcast books and mentorship group things and video training and all of that stuff. And there were some gaps, not a lot. Most of the gaps were really like, all of my stuff had been focused on multifamily. And that's when I learned about, like, hotels and office and, you know, industrial and learned about all those other things, retail through those classes. So but, like, again, none of it's rocket science. No. None of it is the hardest thing to do is IRR calculation, which you can do in Excel. There's a formula.

Dan Austin: [34:49] That's yeah. You're right. Yep.

Matt Picheny: [34:51] Everything else is like addition, subtraction, you know, the basic algebra, like super basic. So

Dan Austin: [34:58] Yeah. I wrote down, like, I'm gonna repeat back what you just told us. So which Mike and I love, you went and got mentorship. You paid to play. And that's one way to accelerate. I mean, without that, I'm sure you'd argue it would have taken me another two years to even find a deal. So, accelerating opportunity by getting good mentorship, by educating yourself through there, then you basically practiced, you were underwriting deals, you were just doing it repetitively, not giving up. You went and got education, you further educated yourself. Like you said, you probably didn't have to have it, but you're sprinkling in, you're constantly adding to this bucket of knowledge you have, and then you're out there networking.

Matt Picheny: [35:32] And I'm still doing that to this day, Dan, like I still look for opportunities to learn, I'm always trying to learn.

Dan Austin: [35:38] I love it. And you gotta be, and you need to, because you have to adapt with the market. The market's ever changing, right? So, you have to be able to adapt, and also, we've interviewed some folks in the past, where they, you know, they talk about, sometimes your goals change, and so if your goals change, maybe you're like, hey, I love department syndications, but now I really want to focus on strictly Broadway, and I want to just invest in Broadway syndications, you need to adapt and educate yourself. Right? So, love that. Yeah. It wasn't rocket science, like you said. You just put in the legwork. That was cool. Thanks.

Mike DeHaan: [36:06] I think that's the core of our real estate. It comes down to doing the things that are a bit boring for long enough Consistent. Stuff finally comes together and just being consistent with it. It's the same with, you know, what we do, which is wholesale real estate. Right? Most residential. Going through and talking to all the leads that don't have anything to do with us is not very fun. Going through and ordering the marketing and doing the data is not very fun, but it's where the money's made. A lot the money's made. What's the fun part, Mike? The fun part is getting to tell people about when we walk through crack houses or the insane stories that we have with some of our sellers that just make you instantly the most interesting person when you're at like a dinner party. Yeah.

Dan Austin: [36:46] And the and the the checks that you get to cash every once in while are fun. Those are fun too. And the checks, the stories

Mike DeHaan: [36:51] are why we do it.

Matt Picheny: [36:52] That's true. Nice. Yeah. Yeah. Cool.

Mike DeHaan: [36:56] Awesome. Well, lots of good stuff there, Matt. And and I love the way that it's like, you like the definition, I feel like of, know, keep it simple, stupid, right? Like, keep it stupid, simple, or whatever it is, know, where you're just, you know, you're doing the foundational stuff. And like I nothing's rocket science and nothing is is outrageous. And to get to 4,000 units, you did do that relatively quickly. I'm guessing it's just more repetitions, more relationships, and the all just came together just over time. Yeah. So awesome. I love it. So before we get into the show, just quick tangent. I know you said you're an actor. I've been looking at your background. Is that Tony award that you have behind you?

Matt Picheny: [37:30] There's a there's Tony award. There's actually there's two of them. Wow. Actually, there's one there and one there. Oh. Yeah. And

Dan Austin: [37:36] so my

Matt Picheny: [37:37] wife and I coproduced a couple of Broadway shows that won Tony Awards. So we get Tony Awards for that. Wow. Yeah. Moulin Rouge and David Byrne's American Utopia.

Dan Austin: [37:47] Really?

Matt Picheny: [37:48] So that's that's cool. Yeah. So, you know, I always wanted to win a Tony Award for, like, best actor. And unfortunately, my never my acting career never got me there. But now I had mentioned that we started investing in some Broadway shows, and we've actually coproduced some Broadway shows. Those two did really well.

Dan Austin: [38:06] So yeah. I okay. I know Moulin Rouge! With Christina Aguilera. Right? That was cool stuff.

Matt Picheny: [38:11] Right. So there was the

Dan Austin: [38:13] That's a movie. No. I know. But I was gonna lead up to the question is like, so did was there a connection to the Broadway where who I don't know who played that character on the Broadway. I'm I'm not a Broadway person, so I don't know.

Matt Picheny: [38:24] Yeah. So Moulin Rouge was a movie made by Baz Luhrmann.

Mike DeHaan: [38:28] Okay.

Matt Picheny: [38:29] And it starred in Nicole Kidman

Mike DeHaan: [38:31] Mhmm.

Matt Picheny: [38:31] And Ewan McGregor.

Dan Austin: [38:33] Mhmm.

Matt Picheny: [38:33] And that was, like, twenty some odd years ago. Sure. It was, I think, seventeen years right before we opened the Broadway show, which was four years ago or so. And we were able to work with Bozz and get his, blessing and go ahead and and take that and bring it to to Broadway and bring it to the stage with, like, an amazing amazing creative team and amazing cast.

Mike DeHaan: [38:59] The

Matt Picheny: [39:00] show won 10 Tony Awards, including best musical, like best costumes, best set, best sound, best lighting. You know, a bunch of the performers won best leading actor, best awarding, you like, all those different things. It was just a really finale talented group that put this amazing show together, and it's still running on Broadway. If you ever make it to New York, go check it out. It's really fun. And the cool thing that that we did with the show was, if you remember the movie, it's like a mashup of, like, a whole bunch of famous songs. You know, there's, an Elton John song in there. There's, like, a Nirvana song in there. Right? And what we did since it had been seventeen years since it had been a movie and brought it to Broadway, we we kept some of those classics in there. You know, there's there's still a song by Elton John and and Sting and then, you know, a whole bunch of the classics. But we also brought in Katy Perry and Adele and Jay Z and, like, a whole bunch of contemporary music as well so that it really appeals to to younger and older audiences alike, and it is just it's a party. It is a really, really fun show. It's also off it's it's out on tour now too, so it might be coming to the city where you live. Oh.

Matt Picheny: [40:17] But it's an awesome show. Really fun.

Mike DeHaan: [40:21] Wow. Yeah. That is super cool. Yeah. Sorry. I'm sorry for the tangent. I just saw the award back there, and I just wanted to bring recognition. That's super cool. Congratulations. Thanks. Very cool. Yeah. That that is fun. I've I've been to a handful of Broadway shows over the years, and I've always enjoyed them.

Matt Picheny: [40:34] I love arts in the theater, you know, and so being able to still have a finger in that a little bit here and there as sort of like a hobby thing is really special that I get to do that.

Mike DeHaan: [40:45] Yeah. I mean, and that's what it's all about at its core. I mean, if you say you own 4,000 units, but you don't get to do any of your hobbies, what the hell is the point?

Dan Austin: [40:54] Exactly. That's so true. I mean, honestly, the point.

Mike DeHaan: [40:58] So, yeah. But awesome. Well well, good stuff, Matt.

Matt Picheny: [41:01] And again, real estate is my hobby.

Mike DeHaan: [41:03] Yeah. Right? Yeah. Yeah. Alright. Cool. So going to the end of the show here, we have our three end of show questions that we always ask everyone that comes on the show. So first one is going to be, what is your craziest real estate investing story? And this can be a big win. This can be like a crazy seller, crazy tenant, big loss. Whatever it is, your craziest story.

Matt Picheny: [41:26] Crazy buyer. Alright. Crazy buyer. Crazy buyer recently has happened. And I mean, we just had all kinds of problems with this buyer. But the the strangest thing that happened on it and this was like, you you have to understand that there had been delays extensions and this thing had just been going on and on and on. There were some extensions contemplated in the contract. You know, we went beyond those extensions and more extensions, but we we wanted to close the deal. We didn't want it. And we could have taken the earnest money. There was over $1,000,000 of nonrefundable money at this point because

Dan Austin: [41:58] it's nice.

Matt Picheny: [41:59] It walked away. We that's not what we're about. You know, we just wanted to finish the deal and have them buy the property. And so closing day, they're like $5,000,000 short.

Dan Austin: [42:11] Oh, boy.

Matt Picheny: [42:12] Yeah. So they call they're like telling our broker that they have the money and it's being wired that day. But one of the partners on their end is like back channel talking to one of my partners saying, we don't have all the money. Can you, like, give us a $4,000,000 carryback, and we'll, like we'll pay you later. Like, you know,

Dan Austin: [42:34] we'll IOU. Just a little IOU.

Matt Picheny: [42:36] Yeah. Well, I mean, it would be more formal, but and I'm telling this to the broker, and the broker's like, no. Like, I just so then the broker, like, gets off the phone with me, calls the the buyer, calls me back. He's like, no. The buyer says the money's, like, been wide. Like, it's just it's in transit titles like, yeah, we're like $5,000,000 short. I'm like, and they've been short like this whole time. There's been all these delays. Finally, at like 04:30. They admit that they don't have the money. Now told that they don't have the money so that they're not gonna be able to close on the deal, and that we need to give them the carry back. And I'm like, guys, you cannot wait until like the day, like 04:30 on the day of closing. Yeah. It's not like you just lost $5,000,000. Like, you knew you didn't have this money. Like, you've been dragging this on, and I am not gonna give you like, a $4,000,000 carryback. Like, you have two options. You can extend for another two weeks and give us 200 k. You're just gonna give us 200 k to pay for it. This is a $52,000,000 deal.

Mike DeHaan: [43:42] So because

Matt Picheny: [43:43] you're waiting till 04:30, and you need to feel a little bit of pain here. But also, because they had mentioned this thing about that maybe they could get some hard and I felt like they were just trying to stall.

Mike DeHaan: [43:55] Right.

Matt Picheny: [43:56] So I'm like, either that or you don't do the extension and we get your million dollars heart money and we we all walk away from the table with us. Like like, now what we wanna do is short and close the deal. Miraculously, like ten minutes later, they get the $5,000,000.

Dan Austin: [44:10] Oh my gosh. Ten minutes later.

Matt Picheny: [44:13] And it gets wired to it is being wired. Okay. My goodness. It shows up with the title company. The title company has $5,000,000, gets wired. So now they have all the money that they need to close the deal. So they send out an email and they're like, okay, everybody, you know, buyer and seller have signed the closing statements and per their instructions. We are now officially have closed on this deal. But being that it's 05:30 at night, we cannot wire the the proceeds until this is on a Friday, until Monday morning. So we will wire the proceeds on Monday morning. Okay. 06:30, I get a phone call from the title agent. Title agent's like, did you agree to give the buyer some of their money back? I'm like, what are you talking? She's like, check your email. She's like, I just forward you an email. The buyer reached out to the title agent and said, hey, we need you to wire back $3,000,000 and, like, here's the wiring instructions. Please go ahead and wire this money back.

Dan Austin: [45:21] That is crazy. Right? Oh, wow.

Matt Picheny: [45:25] So she was like, well, has the she writes back, like, has the buyer agreed to the a seller agreed to this? And then the email back is not yet was the response. Not yet, but just

Dan Austin: [45:39] send it. Just send it.

Matt Picheny: [45:41] And then there was no more communication about the thing. Like, never heard about it again. I was sweating bullets until Monday when we actually got

Dan Austin: [45:48] Right.

Matt Picheny: [45:49] The funds actually appeared in our bank account because I was like, I don't know. Is there some weird loophole where they can

Dan Austin: [45:55] Totally.

Matt Picheny: [45:56] Somehow Don't

Dan Austin: [45:57] count your chickens till the

Mike DeHaan: [45:58] eggs their money

Matt Picheny: [45:59] got actually the money was in the bank. Yeah. Once the money was in the bank account, was like, alright. Cool. But, like, that is I mean, the brokers are like, this is the weirdest thing that's ever happened. Titles, like, I've never seen. And, like, everyone I ever tell this story to, they're like, that's the weirdest thing I've ever heard. So that's that's my strangest real estate story for you.

Mike DeHaan: [46:19] That's crazy. That is crazy. So so you never got any sort of justification for why they asked

Dan Austin: [46:24] They're just like, shoot your shot. Maybe I'll get 3,000,000 back.

Mike DeHaan: [46:29] You have you have any sort of hypothesis on that? Like, I guess what I would assume is they probably got a transactional fund from somebody that was like gonna be paid, you know, a lot over the weekend. And they were like, oh god, maybe we can just like give him that money back and then rewire it on Monday or something because they didn't wanna carry it for like two days of interest.

Dan Austin: [46:48] Oh, maybe the extra couple days of interest. Yeah.

Mike DeHaan: [46:52] And Mhmm. Yeah. At like 20 or 30% or whatever the daily interest was on

Dan Austin: [46:57] That's nasty cheese. Like that short term. I'm glad you got your money and it closed. But, yeah, that was probably a long weekend for you.

Matt Picheny: [47:04] That was a very long weekend.

Mike DeHaan: [47:06] Yeah. Wow. Yeah. That that is that is a good one. That is like white collar crazy too. That's that's different than a lot of people that come on here and have, like, you know, crazy contractors. That's pretty cool.

Matt Picheny: [47:16] Oh, I've had other crazy stories like the unit that we walked into and there was like a monitor lizard and like an eight Oh, foot god. Dog constrictor and like all that. The guy had like 12 snakes in the unit.

Mike DeHaan: [47:29] Oh, that that's par for the course of residential, man. We we bought a house that literally had an entire room for

Dan Austin: [47:34] their birds.

Mike DeHaan: [47:34] About that. And they had,

Dan Austin: [47:35] like, 30 birds in there.

Mike DeHaan: [47:38] They had so many than that.

Dan Austin: [47:40] They had more than that. The entire house smelled because they had so many birds in that room. It was gross. I bet you it was 75 to a 100 birds.

Mike DeHaan: [47:46] Yeah. These, like, little, like Everywhere. They had Everywhere. Everywhere. And you open it, and it was like

Dan Austin: [47:50] Like, the the floor was just pooped.

Mike DeHaan: [47:52] All pooped.

Dan Austin: [47:54] Yeah. Was it was yeah.

Matt Picheny: [47:55] Was terrible. That's that's

Mike DeHaan: [47:57] too Not that much. Yeah. It was it was crazy. But alright. That that's a good story. I like that one, man. That's probably one of the the more entertaining ones we've had in a while. Cool. Alright. So second question, what is the number one piece of advice you would give to and this is the number one piece you give to either a brand new investor looking to get started or to a small time investor looking to get to the next level?

Matt Picheny: [48:17] It's all about relationships. In my book, I I have these keystone concepts that I share with the reader, the things that I learned along my journey. There's 18 of them. And one of them is says it's all about relationships. You know? And that that's true in other businesses besides just real estate, but definitely in real estate, it's about those relationships that you make then, that's how you can get to to the next level of the game, or that's how you can get into the game. It's all been about relationships for me.

Dan Austin: [48:45] That's great advice. Exactly. Keeping it simple.

Mike DeHaan: [48:47] Yeah. Real estate and life in general. If you have good relationships, life in general is a lot easier. It makes it so much easier. Yeah. Yeah. So alright. Cool. Last question. Where can people find you, follow you, and reach out to you if you'd like them to do so?

Matt Picheny: [49:01] Yeah. I would say go to my website, which is picheny.com. I'll spell that. It's picheny.com. And I don't know if you guys do show notes, but you'll probably put a link in the show notes for That's where I have look. I have a I have a newsletter that's got tons of free investment information. I send that out every month. I've got all these articles that I've written. Just there's tons of free education on there. You can find out about my book. You can download a free sample of my book. There's just tons of stuff on that website. So go to pachenni.com and check it out.

Mike DeHaan: [49:32] Nice. Cool. Perfect. Easy enough. Well, awesome. Well, thanks so much for coming on the show, Matt. I really, really appreciate your time. You had

Dan Austin: [49:39] some really great

Mike DeHaan: [49:40] information in here, and congratulations on your success too. It is Thanks, guys. Pretty amazing what you've done over not a big period of time. You started doing that in 2015. I mean, seven years, you're 10,000 units in. I know a lot of them are LPs, but that's still a very impressive portfolio. So good for you, and I appreciate you sharing the value with our audience. Well, guys, if you enjoyed this show, and if you didn't, I don't know what to tell you. You should please go and share this with anyone else who wants to start taking investing seriously and start buying properties and, you know, growing wealth. Like, think about it. You could share this to somebody right now, and by 2030, which is about the same timeline Matt has had, they could also have 10,000 units. And that's not that far away. So go ahead and take action and share this with everybody. And if you wanna start finding off market deals, you go to collectingkeyspodcast.com/free, and you can get our free five step guide to start collecting off market leads just like Dan and I do every single month. So you can start making some sweet money with off market real estate as well. So thanks so much listening, everybody, and we'll talk to you next week. See you.

Matt Picheny: [50:42] Thanks for listening, everybody. Please make

Mike DeHaan: [50:43] sure you subscribe and leave us a five star review wherever you listen to your podcast. Also, please make sure you go and you share this with other people within your network. We are really trying

Mike DeHaan: [50:53] to grow this thing, and

Mike DeHaan: [50:54] the best way for us to do so is by you telling other people to come and check us out. You can also follow us on Instagram. I am at Mike underscore Invest. Dan is at investor man Dan. You can follow the podcast at collecting keys podcast. And if you wanna learn how to make real money as a real estate investor or you want to grow your already existing real estate investing business, please go and check out instantinvestorprogram.com and book a call with either Dan or myself, and we will see if you'll be a good fit. Thanks for listening everybody, and talk to you next week.

Speaker 2: [51:30] Podcasts, and check us out at collectingkeyspodcast.com for tips and guides on starting your own real estate investment and wholesaling business.