How To Buy A Business That Builds Massive Wealth w/ Real Estate Investor Drew Wiard

Mike DeHaan: [0:00] Real quick, guys. If you want to take your real estate investing business from 6 to 7 figures in the next twelve months, and you wanna do without being a slave to your business, then you have to check out our scale community. You can get the full details at collectingkeys.com/scale. But very basically, it is a community of like minded investors who are working to become the absolute top tier investors in their market. Along with three coaching calls per week led by Dan and myself, we also have a whole bunch of videos and materials that go into all the different SOPs that we use to run our business on a daily basis. This includes how we manage our sales team, how we hire, how we do our marketing systems, how we get the best assignment fees possible, how we do renovations, how we do all the different kinds of creative financing. And if you are serious about taking your real estate business to the next level, it is absolutely something that you should check out. So go to collectingkeys.com/scale, see all the details, and see if you're a good fit.

Drew Wiard: [0:59] I think people do make the mistake of buying that, you know, million dollar business that throws off $200,000 thinking it's gonna be great. And if if you want a job, you just bought yourself a job, and that's okay. There's nothing wrong with that. But I didn't want a job. I wanted to be an owner, and those are two different things.

Mike DeHaan: [1:14] Exactly. We are here today with a repeat guest, Drew Wiard. Hello. Who we had a slightly different tone, but he's a really, really awesome entrepreneur. And his last episode, we focused a ton on cash flow and the different ways that he creates that with his real estate business in the Midwest. And on this one, we focus very heavily on his change into business acquisition and talking about the three different businesses that he has bought just since he was on the show last, which was like eighteen months ago. Yeah. So a ton of things have changed for him.

Dan Austin: [1:48] Yeah. He's still doing the real estate and it's probably the same size and the same growth as he was then, but he's just added this layer of businesses to it. And it's fascinating for him to talk about it because if you put it into an asset acquisition mindset, it's not that much different than real estate, but it's also totally different because now you're taking people's lives in your own hand. And he talks about the culture that he's trying to integrate as he's buying, and stabilizing these businesses, and bringing them all into a one roof. So it's a super good conversation.

Mike DeHaan: [2:13] Yeah. And it's just like so much about, you know, how he financed it, how he found it, how exactly he learned about the industry he was getting into, is like book binding and he had no idea Yeah. To do. I didn't even think what that meant Yeah. When he got into it. And you know kinda just what it takes to really like get into that realm and surprise, it's not that different from buying rental properties. Like it is a little bit I guess by the outcome and sort of like the long term management that you need for it. But the principle of getting into it is fundamentally the same. And when you hear some of the numbers he talks about, like there's no doubt that you'll be thinking, man, maybe I should look at adding this to my repertoire as an entrepreneur as I get more involved because they honestly make some of the rental properties we look at pretty pretty lame. So anyways, guys, really good episode. Don't be afraid to reach out to Drew after the show. He's a super nice guy, super involved on social media, and is more than happy to share his really incredible wisdom with you. So everybody, enjoy the show with Drew Wiard. Enjoy. Today, we are welcoming back to the show Drew Wiard, and dude, I am so excited to have you back on.

Mike DeHaan: [3:18] You are still to this day, our fourth most popular episode that we've ever had, back in episode 97, Becoming a Cash Flow Master. And you have done an incredible amount since we recorded that episode like eighteen months ago. So dude, I'm really excited to have you back on the show.

Drew Wiard: [3:36] Yeah, thanks for having me. Now I'm fired up to try to become number one. We'll see what we come up with.

Mike DeHaan: [3:41] You can do it. Mean, you drop some good content, it'll definitely happen. I will say the algorithms work against us these days because the way that they track downloads now is different. And so, it's gonna have to be like two x is good. So that's the real big Okay. You're have

Drew Wiard: [3:55] to go above and beyond. Well 10 x is easier than two x, so let's get it.

Dan Austin: [3:58] That's what they say.

Mike DeHaan: [4:00] Yeah. Said said Drew Wiard, you guys quote that him right there, go and take that

Drew Wiard: [4:04] Trick mark.

Mike DeHaan: [4:04] Put it on an Instagram post or something and make sure you tag the right person.

Dan Austin: [4:08] That's like a flying investor.

Mike DeHaan: [4:10] Yeah. Mhmm. Yeah, man. So either way, you've been up to a ton over the last eighteen months. You, I guess, give people a really brief level, and you can dive into details on it, but you have acquired three businesses since we talked to you last. You have bought and sold a lot of real estate, you've done some commercial deals. Your whole mindset around real estate and everything else has changed, and after just reconnecting with you, I think we were on a Go Button Zoom call, we just decided you had to come back on man, because you are, I would say, such an evolved entrepreneur from the last, like two years ago, less than two years ago when we last chatted.

Drew Wiard: [4:46] Yeah, yeah. So it's been an adventure, to say the least. So the long backstory was that I did medicine for fifteen years. I walked away from that or retired in summer of 'twenty two. And so we're coming up on two years of that. But I will say, once you cast off those shackles, then the evolution started, right? I had a freedom figure out who I really was, what I really wanted, what my core principles are, all of that kind of stuff, right? So I've been really leaning into that. Like you said, eighteen months ago, we bought business number one. It was in manufacturing in Detroit, which I know nothing about manufacturing. Like what on earth took me to manufacturing? That could be a whole episode.

Mike DeHaan: [5:25] What on earth took you to Detroit? Yeah. Like that's a value question.

Drew Wiard: [5:28] Well, that would be another fun discussion. But a couple months later, then we merged with our sole competitor there, and so now we own a 300 mile radius for the service that we provide in that area. And then we just acquired our third business, which is actually pretty rad. It's a comic book business where if you're an indie artist for comics, you basically come to us and we help you take your art, put it into books, people then take them to Comic Cons and sell them and do all sorts of things, so.

Dan Austin: [5:59] I got so many questions on this. The first question is, like, how

Drew Wiard: [6:03] did you even know this is a good business

Dan Austin: [6:05] to buy? Like, what got you into buying a business?

Drew Wiard: [6:08] Yeah, sure. I mean, not to get too far in the weeds on like how you analyze a business, I think like if you're asking mindset, like what even took me there since real estate was firing on all cylinders? For me, I'm a passive investing guy. I don't mind wholesaling, I don't mind doing flips, they're not my favorite, but they get taxed at the highest, which I don't like them the least, right? So I'm the buy and hold guy, but we all know that's a really slow game to play. You start playing in your twenties or thirties, and by the forties, you start feeling it. By the time I get to my fifties, I'll be really, really happy that I went But it's a slow, slow game. Business acquisition and scaling that up and increasing the multiples that you can sell at downstream or just the cash flow that those businesses throw off can be a much, much more rapid way to grow your your cash flows or a big exit on the back And so, that was really the game, is to own businesses that spin off cash. We know they're gonna get taxed pretty highly, but then you take all that money and you hide it mostly in commercial real estate for all the tax advantages. And so that's kind of the left hand, right hand strategy, and then I got a lot of other little real estate stuff in

Mike DeHaan: [7:16] the background.

Drew Wiard: [7:16] I love it.

Dan Austin: [7:17] Make massive income so that you can invest in passive income.

Drew Wiard: [7:21] Because passive income is expensive to get. Yeah. For sure. Yep.

Mike DeHaan: [7:26] That that that's our old tagline is to make massive income before passive income. Like our tagline for our podcast and our scale community.

Drew Wiard: [7:32] Yep.

Mike DeHaan: [7:33] So I'm assuming that it was super easy to figure that out. Right? You just followed Cody Sanchez on Instagram, and then just like sent her a couple DM's and she just sent you a thumbs up back, and you're like, I got it, it's gonna be

Drew Wiard: [7:43] Yeah, slam dunk. That's all there

Dan Austin: [7:45] is to it, right? At least that's why all

Drew Wiard: [7:46] the cool kids are doing it, for sure.

Mike DeHaan: [7:48] Yeah, right. No, but like real talk though, like how did you even begin this process? Like what was the, did you use like a business broker? Did you like market for these? Yeah. I know you have a couple partners.

Drew Wiard: [7:59] Yeah, really good question. So my partner Tyler, he gets a lot of credit because he's absolutely brilliant. And he had quit his job maybe four or five months before I did. And we had already agreed we were gonna do a bunch of commercial real estate together and had started buying things. He had always kind of wanted to own a business. And once he got rid of his job, he jumped into a mastermind that kind of talks about it and talks about the process of how do you find the kind of business that you want. I didn't join that mastermind, but I read some of the books and I kinda followed along with them. And then when I dipped out, we were kind of teed up and ready to go shopping. And so we just, it was listed with a business broker. We looked at multiple businesses. Some were a good fit, some weren't, but we we found it and went to visit and seemed to be a good fit. So we threw out an offer. They took someone else's offer, but then came back to us a couple of weeks later because that first buyer lost their ass in the crypto meltdown about Oh nice. That So they couldn't liquidate and and buy the business.

Mike DeHaan: [8:58] Seems a weird thing someone to do to go from crypto to printing books. Feel like that's literally the opposite. Yeah, but it

Dan Austin: [9:04] sounds like somebody that's just following social media doing what people say to do.

Mike DeHaan: [9:08] No shit.

Drew Wiard: [9:08] Well, they certainly could have been. Know, the other thing is maybe it's an easy out if you don't have the money and you gotta come up with a sexy excuse and bitcoins and all the news like, I don't know. Sounds like a good alibi.

Dan Austin: [9:18] Yeah. So, let me ask you this question then, Drew, when you talk about the business broker, finding the deal, did you guys have like these core pillars before you actually were like, we're gonna do printing? Were you like, hey, want it to be manufacturing or we want it to be even more broad like, hey, we want Like, one of the thoughts I have is like, I would wanna buy a business that's scalable by increasing marketing and sales.

Drew Wiard: [9:41] Sure. Sure. So, I think the mistake that most people make is if they're thinking about buying a business, they think about what kind of business they wanna buy, what sort of niche they wanna be in. Uh-huh. And they limit themselves just to that. Right. I think it can be healthy to say, I don't want x. Like, for example, example, my partner and I didn't want any SaaS businesses or software as a subscription. We didn't wanna buy tech because it's not real and tangible and we don't come from that world. If it went sideways, we don't have the expertise to course correct. But what we really wanted was something that had revenues north of $4,000,000 and at least an EBITDA of $750,000 because at that size, you should have some front office staff, some leadership, some bookkeeping, some HR, like things that so that we don't have to carry that full burden. We also we weren't married to manufacturing, but we liked the idea of, like, creating real things that the real

Dan Austin: [10:35] world

Drew Wiard: [10:36] needs of tastes and preferences and things like that. And so we had a series of those qualifiers. We didn't want to go more than about three or four hours from home and Detroit's three or four hours, and so that's

Mike DeHaan: [10:47] what we found. Interesting. So I guess when you were going through all of that, I mean, like the there's obviously a lot of things that you don't know about printing books. Like, I'm assuming there was people there that already knew out all the equipment, how like, what the actual process looks like. Or is it or is that kinda just a simple process where you just went in and they, like, have had good enough SOPs that you were able to just sort of figure it out yourself?

Drew Wiard: [11:12] We had a lot to learn. We don't come from the print and binding world in the Oh, no. Yeah. So we had to learn a lot about equipment. A lot of lessons learned. If I could do it over, I would have hired an equipment broker or assessor to come in and say, okay, these machines are this many years old, they're gonna last this much longer, they should be worth Given the age of those machines, we probably overpaid. But you don't know those things till you get in there. You know, so many lessons you learn along the way. Like, I will take that and use it going forward. You know, I'm ever buying another business with equipment, we're gonna have someone tell us exactly what it's worth so I don't overpay or I understand the risks that I'm taking. Totally.

Mike DeHaan: [11:50] Yeah. What's like the financial structure on something like this? Are you did you like sell a bunch of rentals and buy us in cash? Did you sell or finance? Did get an SBA loan?

Drew Wiard: [11:58] Yeah. Really good question. So to put it simply, I think after the inventory and the work in process and all these things that you have to give value to, I think we paid like 2,700,000, something like that. We got an SBA loan for 80%, which by the way, if you think getting real estate loans is difficult, the SBA and the government are gonna turn you inside out.

Mike DeHaan: [12:22] I'm

Drew Wiard: [12:22] still walking funny from that experience.

Dan Austin: [12:24] I've heard it's not a great experience, yeah.

Drew Wiard: [12:27] It's an amazing product once you get it, but if and when we get another one, I'm gonna time block a month just to really dig into it because I was, even though I'm typically very well prepared, I was ill prepared. But the seller carried back 10% and then we brought 10%, I brought five, my partner brought another five. So when it was all said and done, I think like I was all in for a 127,000, something like Yeah.

Mike DeHaan: [12:51] That's pretty wild, right? So you're on a 127,000 for a business you said that was, it had EBITDA, what?

Drew Wiard: [12:56] $7.50, something like that.

Mike DeHaan: [12:58] Yeah. And so like how much of that is actually like take home to you at that point? Or am I sure how they share that information? I know business stuff gets weird.

Drew Wiard: [13:05] Yeah. I can share that information. Admittedly, we went into it like we have real estate holdings, and we do the direct to seller stuff that you guys do as well, and so we have other means of income. So for us, we had quit our jobs, but we didn't need huge salaries. We knew we have old equipment, we've got some strategic things that we need to do with this business. So we gave ourselves very modest salaries, but we also covered all of our health insurance as well. So, like, he's got three kids, I've got four kids. We bought ourselves really nice insurance packages, and the company just pays for the whole thing. Nice. You know, there's other advantages like vehicles, business expenses, things like that. So we're only paying ourselves about 65 a year, could be a lot more, but we would've paid down debt, we've had to buy some new equipment, things like that. Outgrewings have a

Dan Austin: [13:52] good question on that piece when you talk about the paid out debt. So say, as far as a proportion of the EBITDA, if you were looking at a business, so thinking about this from a listener standpoint, because it sounds like, shoot, I'm gonna go buy the same business, it sounds great, right?

Drew Wiard: [14:05] Yeah, I don't know that I would absolutely recommend such things, are pros and cons, for sure.

Dan Austin: [14:09] It's not that easy, right? But like, out of 750,000 EBITDA, you're going to have some debt paid out, is there like a threshold where you're like, yeah, I'm not gonna touch that because the debt payment is not going to be worth the squeeze, or is there not, is there anything that you would look at on that thing? So I kind of think about it from like a rental property standpoint. Hey, at some point, like there's not enough cap rate spread between the Yeah. Interest rate, And so on SBA loan, you're paying probably nine or 10%, I don't know, and then you have a balloon at maybe ten years? Yeah. So your monthly debt payment's probably a lot.

Drew Wiard: [14:41] It's bonkers, man. So I get what you're saying, like if you have real estate debt at three or 4% and you like that asset, you would not pay that off early unless you're a Ramsey follower, which to each their own, but it ain't for SBA debt right now, it's floating rate and it is floating at a god awful juicy 11%.

Mike DeHaan: [15:00] Nice.

Drew Wiard: [15:00] So your loan will go

Dan Austin: [15:02] up and down with that rate?

Drew Wiard: [15:03] I have only known a reality where it goes up. So yes, I would love to see it come back down. But admittedly we stress tested it up to 11, we thought Like was there's no way it's going to 11, but we'll stress test it proactively.

Dan Austin: [15:18] You're waiting for the re cut right now,

Drew Wiard: [15:20] I know it, you're itching. I'll take it, yeah, I would take it. But to answer your question, it amortizes over ten years, the whole thing's due. If we just make our payments, we will have paid down, I forget what that loan was, 1,800,000 or something like that over ten years. Yeah. Yeah, so like in contrast to real estate, you're used to thinking fifteen, twenty, maybe thirty years if you're getting residential mortgages and things, they just take forever to pay those, even if you're at 4% or whatever you got locked in at. Whereas this, I don't like paying 8%, but I'm already a year and a half into it. And I mean, I've paid down a couple 100,000, you know? So that's the other thing with businesses, not only can you spin up the cash flows, but if you can find a path to paying down your debt, if I, say that we have just a huge year in 2024, and I've got an extra $500,000 Well, you know, I could take an extra 50, my partner could take 50, and we could take an extra 400, pay it down on that debt and ask the SBA to ream it. Not extend the deadline, but just spread the payments out and that monthly payment gets lower and just helps the business. And so I'm a principal pay down guy. So Yeah.

Dan Austin: [16:28] I think there's just a lot with that that like from the audience, like if you're not familiar and I'm very little, I have a little knowledge but I've been talking to people about this just from some general interest and understanding and educating myself and there's a lot to learn and understand about the SBA process or conventional loans and why you would also maybe wanna buy a certain size business because Mhmm. At some point in time you need enough EBITDA to like really actually do stuff with it.

Mike DeHaan: [16:52] Mhmm.

Dan Austin: [16:53] You you see a lot of people wanting to go buy businesses and in my opinion are thinking maybe too small, because what it takes to grow a business and scale a business while you're also paying off debt is a lot. Yeah. Yeah. Yeah.

Drew Wiard: [17:03] And you make a fantastic point and honestly like, it may sound to the audience that like a $4,500,000, 4.5 in revenue, but we bought it for like 2.7. I would not steer people away from that, but for me and my we will not buy another one this small again. Like, we're only going bigger because the bigger you are, the more front office you can afford, the more key soldiers you can put in place to really lead the teams. So yeah, we're not going any smaller. I think people do make the mistake of buying that million dollar business that throws off $200,000 thinking it's gonna be great. And if you want a job, you just bought yourself a job, and that's okay. There's nothing wrong with that. But I didn't want a job, I wanted to be an owner. And those are two different things. Exactly.

Mike DeHaan: [17:44] So I guess what's your long term plan with this thing? You must have an exit strategy. I know from your real estate conversations that we've had, your strategy's always been to just hold that stuff forever and to build a large portfolio. Is your goal to do the same thing with these businesses? Or are you trying to like do like a bundle and exit or?

Drew Wiard: [18:06] It's a really good question. There's not gonna be a real satisfying answer, but what I will tell you is Tyler and I, my partner, we don't buy anything that we aren't willing to sit on for ten years. Mhmm. I don't know that we're in any rush to sell it. For me personally, it's gonna be driven by what my core values are, right? And one of those really center around freedom. I wanna have ever increasing degrees of freedom for myself and the people around me, right? So as long as that business is increasing my degrees of freedom, far as time, financial freedom, all of those things, great. I'm in a season right now where I am in the trenches because we bought the third business, we're moving them all into a building. We could talk about all that if you wanted to. But so time wise, I'm really constrained, but what we're building will throw off hopefully silly cash flow. And if someone comes along and throws us an offer, I mean, if someone comes to your residence and offers you a million dollars for it and you paid 300, you're gonna at least have a conversation, So I think we'd be open to conversation, but it's not the goal to necessarily sell right away. I like the idea of acquiring more businesses because you usually buy them at a multiple of EBITDA. So EBITDA times three, EBITDA times four, something like that. But as your business grows bigger, you can buy them at EBITDA and two and a half, but as soon as you roll it into yours, if yours is big enough, it might become a six x value immediately without changing anything.

Drew Wiard: [19:32] And that's just because of size? Yeah. Well, the roll up strategy. Yeah. Absolutely. Because there are companies, private equity and things like that, who'd be willing to go buy a $20,000,000 revenue business that has EBITDA of 4,000,000 every year, and they'll pay you seven times for that.

Mike DeHaan: [19:49] Mhmm.

Dan Austin: [19:50] You know, and the the way I explain that to people when they're like, that makes no sense. They'd wanna pay more than a smaller place would. But like I remember Warren Buffett talking about this and and he has so much money, like in his fund, that his biggest problem is is there aren't things big enough for him to buy, so he can only buy one or two deals a year. Honestly, if that, and that's why he's sitting on so much cash is in his mind there's just not anything good enough that's big enough to buy, and so private equity's the same way. They need to place money, and so they're willing to pay for a larger multiple for bigger deals because it's better for their business model.

Drew Wiard: [20:22] Well, they need businesses that are on cruise control. They don't have the ability to get down in the nitty gritty unless they absolutely have to, right? So they want to buy multiple businesses all that are trucking along and doing well. And anything less than, I don't even know, I don't know what the right numbers would be, but 10,000,000 in revenue and 2,000,000 in EBITDA, they're not even gonna snip.

Mike DeHaan: [20:45] Yeah. I think a good comparison for people in this that are listing that are like more real estate inclined, it's like would you rather have buy 10 single family homes for a million bucks, a $100,000 each, would you rather buy a 10 unit property for a million dollars? Exactly. Right? It's gonna be easier to manage, it's gonna be easier to bring in like sophisticated property management, easier to market, and it's like a singular asset. Same basic principle. How has all of this, I'd say new education experience of business affected your view of real estate? Because that was your jam for like a long time.

Drew Wiard: [21:15] Yeah. If anything, I think it's probably solidified my love for real estate. It certainly hasn't superseded it. What I'm finding is the stuff that I put in place years ago just keeps getting better. You know, rents go up, I pay it down a little bit more, it's all under management. Don't even have to think about it. Again, it just keeps getting better. So it's doing everything it was supposed to do, and it is allowing me to go do this other thing over here where the personal growth is staggering. I mean, every three to six months, it's a new journey, a new revelation. And we've had some ups and downs. We've had a couple of very scary moments, even in the last couple of months, where you have to check yourself and is the business where it needs to be? And so you have to fix some things. It has caused me to grow and evolve a lot. It's given me a lot of purpose too. I really enjoy fixing problems and finding solutions to things that other people can't seem to figure out. So I enjoy that. But that's a windy answer to say, for me it's real estate, period. Yeah.

Mike DeHaan: [22:16] Yeah, and so you're taking that money and rolling it into more properties. I mean, time that you have these higher ROI opportunities, don't you get itchy though, just looking at all your equity that you have in these rentals, and you're like, man, I could go and pile this into more businesses, and like you said, 10 X is easier than two X. You're like, you're rolling the two x game over with your real estate, especially in the Midwest, man. Could go and double down and buy all the bookbinding, printing businesses in Michigan if you wanted to.

Drew Wiard: [22:43] Yeah, you could. You know, right now those businesses, as we merge them, as we acquire new ones, it is growing and expanding at a rate, I don't want it to go any faster. We've got enough that we've got to figure out. And maybe in six months, twelve months, when the dust kind of settles and we're moving all of our shops into one big factory now and that is an adventure in and of itself.

Mike DeHaan: [23:06] Like literally moving them into the same building?

Drew Wiard: [23:08] Yeah, physical moves, we're all in the same spot. So we've been hiring riggers and contractors and like people who come in with huge flatbeds to move these monster machines. Wow. It's pretty mind blowing.

Dan Austin: [23:19] And you own that building with this recent acquisition, did you buy that building too?

Drew Wiard: [23:23] When we merged with our partner, the partner owns the building. Right, okay. So yeah, we don't have to play any landlord games or anything like that anymore. Yeah. So yes, I could sell my real estate and do more business but right now I have all the business that I want. We're gonna go from 4,500,000 in revenue when we bought it to now we should crest 10,000,000 in revenue across all three businesses before the end of

Dan Austin: [23:46] the year. Wow. That's incredible.

Drew Wiard: [23:48] Yeah. It's wild. And we've done it mostly through acquisition. We, like, we haven't even started with the growth and expanding the markets and more sales and all that sort of things.

Mike DeHaan: [23:57] Hey. We really appreciate you being a listener of the Collecting Keys podcast. Did you know that we also are on social media and on YouTube? You should go and shoot us a follow on those as well. You can find both Dan and I on Instagram. I am at Mike underscore invests. Dan is at investor man Dan. You can also find short clips from the show at collecting keys podcast on Instagram. And if you wanna see our faces talking while you're listening to this show or you wanna check out some of our crazy animated adventures we've been putting together into some funny little web cartoons that sort of show the crazy stories that guests tell on the show, then you should go over to YouTube and check out the collecting keys channel. Shoot us a subscribe over there. It really helps continue to grow our audience. We really, really appreciate it. Well, anyways, enjoy the rest of show you guys. We appreciate you all.

Dan Austin: [24:42] That's what I was thinking like from an ownership standpoint, are you guys working? Obviously, you're doing an acquisition strategy now. Mhmm.

Drew Wiard: [24:48] Are you guys thinking you're working on a growth strategy beyond acquisition? Like, hey, how do we increase our sales? I think right now we're working mostly on stabilization and finding all of our efficiencies, right? You buy three businesses, you only wanna do that if it makes life easier. So you don't have to have three bookkeepers, you have one. You don't need to have three HR people, you have one. And we're also trying to merge three cultures into one business, and that's probably the hardest thing. Steering culture, like, again, we had two companies that merged, they were competitors for thirty years. They don't like each other.

Dan Austin: [25:24] Man, they got swords in a break room ready to go at it.

Drew Wiard: [25:27] Yeah, yeah. So they're playing well together, they're doing a really good but that just takes time, lots of time. So growth strategies will probably come, but they're probably, we gotta make sure we're all singing from the same hymnal first, and that'll take three to six months. But to Mike's point about, do you wanna sell it and buy more business? We might, eventually. But for now, I'm just gonna reposition the real estate that I don't like into real estate that I do like. Yeah.

Mike DeHaan: [25:55] And it's acknowledging a better return on equity for the headache, which I know is a big thing that we've always sort of harped on is if you have these properties that have a lot of equity, they're not getting the returns that you want, and there's a sort of upcoming capex items, or there's sort of reoccurring issues, it's okay to sell those to move on to something else. Yeah. More real estate, or private investments, buying a business, whatever that looks like. But something I really like about what you all just said there Drew, that I've always appreciated about you is you have such like a stable long term vision. Like there's so much wisdom behind so many of the ways that you think about things. You know for people that like, I don't know, are trying to figure out those first steps, like how to kinda get into buying a business like this. Where do they even start? Because it's not just following Cody Sanchez or whatever random dude on Instagram and reading their little tweet posts that they make and pretending like I was gonna teach you anything.

Drew Wiard: [26:50] Yeah. I think, man, there's a million and one things I could say about that. I think one thing I would encourage people to do is not chase things that are popular. If you've done real estate and business long enough, you've seen some of the cyclic trends come and go. Ten years ago, flips were everything, and it's HGTV and how sexy they can be on TV. You know? And then multifamily came, and all the kids are doing multifamily, and I've been involved with that. I'm not knocking it because it can be amazing, but there's a lot of people this year who are eating a shit sandwich in the multifamily and the commercial world, and my heart goes out to some of them. Self storage has been the hottest thing, and right now, buying businesses, Cody Sanchez and all these other people, they're just And so I see people chasing the trends. I would tell you, do not, absolutely do not chase the trends. If the trend aligns with who you are and what you want and where you wanna go long term, then absolutely. That means there'll be a lot of good resources for you. But if you're chasing trends, you're just gonna get exhausted and every, what, seventy two months or something, you're just gonna be frustrated and go on to the Yeah, next reinventing yourself every time you try to do something new, and you see that, you see that a

Dan Austin: [28:00] lot with auto readers, and honestly, there's probably been five or six, maybe 10 different things that Mike or I have had to say no to Mhmm. That have distracted us, that we've even started and we've had to turn off and realize, that was a distraction. So it's it's easy to get caught up in like that trend or that shiny object syndrome. The one thing that I'm thinking about, and I heard Matti A from Millionaire Mike House, he did a little like ten minute monologue about this is like, when things get hard, like what do you do? And like how you lean into that, and being hard, nothing nothing easy. Let's say like, I think he's like Jeff Bezos like Amazon. Like you don't think his life is hard? Yes, he's a billionaire, but he still has hard things, and he's choosing to do hard things, that's how he got to where he's at. You're choosing to do hard things Drew. The challenge that I think me and other people might come through is like, am I doing the right hard things?

Mike DeHaan: [28:50] Mhmm.

Dan Austin: [28:51] Is this the right hard thing or am I wasting seventy two months? Do you have any kind of thoughts on like, because I know you've chosen to do hard things of like, things that you've looked at or that you've done to like get through those hard times and stick with it and not bounce to something else because it got too hard? Or that you found that was like, this is the wrong hard thing?

Drew Wiard: [29:10] Yeah, that's a great question, man. I I don't know that I have a really good relatable example. I tend to be that guy who has the grit and the stick to itive nature enough that usually I power through and that has served me well. I will say, my professional career, I got my doctorate in residency and practiced medicine and all that kind of stuff. And it wasn't that it was bad, it was great for a season, but I let that season go on too long. Like it was time to dip out. So I don't know if this is exactly what you're driving at, but I should have known who I was and what I was really about and what might have made me happy and what was definitely not making me happy. Right. And I should have made that pivot probably a little bit sooner. But you make a great point, man. I see a lot of people who are, you know just squeezing that lemon and there's no juice coming out of it anymore. Know? Yeah. So fair point.

Mike DeHaan: [30:02] So I guess to expand on that, do you, when you're looking at your sort of opportunity cost for your time and your money like that, do you have like a set of, I know you said principles, said freedom is a big one of them. Do you have like things that you look at in terms of like how excited things make you feel? Like things that make you exhausted versus like financial potential? Did you create like your own sort of set of boundaries like that or do you just kinda like go day by day and see where the wind blows and then if you decide that it's time to turn it off, turn it off?

Drew Wiard: [30:32] I'll you what, I'll give you an answer to kinda what I think you're asking. I don't know that I've got the perfect answer to like a tool that helps me gauge like am I in alignment that way, but like this year.

Mike DeHaan: [30:44] Yeah, it doesn't need to be a tool, mean like you specifically, because I think it's different for everybody, right? Some people are quitters, honestly. Think it's little hard and they quit. Other people, like Dan was saying, is they're stubborn and they will just be on the same thing forever. But you've changed your path several times. And so I'm curious, for you personally, what exactly are the key principles outside of just freedom that lead you that way?

Drew Wiard: [31:08] Yeah. So this year I really defined my core principles, and I did that out of you know, we all set goals every year, and I would have told you that I was very good at setting goals in years past. Like, I've studied them in the professional world, I studied them with you guys and GoBundance and all that kind of stuff, and I can set quality, measurable, challenging goals that will take us from X to Y by this date, and it's very measurable and that's a good way to do it. But this year, when I was trying to write those goals, I wanted to challenge myself to say why. Why do I want 12 houses a month? Why do I want to buy a third business even though I know it's gonna take a lot of my time? Like, why do I want these things? Like, why am I going to the gym four times a week? Know? Damn it. So I really had to kind of set up my core principles. I came up with five of them, and I've got them written on my board here. They're freedom, well-being, abundance, growth, and time. So those those five things. And basically, I use those core values to then draft my vision of what I want my life to look like. Right? Today and tomorrow, and it's relationships with kids, and it's how much freedom, and what sort of health I wanna be in, and it's all kind of guided by those core principles. And then once I have the vision for my life, then I can write the goals that will point to the different parts of my vision that I wanna have. So like, I want to go do activities with my grandkids. It's not just all I wanna meet them.

Drew Wiard: [32:35] I wanna go hiking in Sedona with my grandkids. That's why I'm going to the gym today at 40s. Right?

Mike DeHaan: [32:40] So

Drew Wiard: [32:41] you have your core principles, helps me cast my vision. The goals that I will set continually point towards the vision. And then it's really just a matter of setting your habits. Like, to the gym four times a week is a habit. Right? Staying under or within my macros every single day, like those are my habits. And so if you can figure out how to set the habits, they drive the goals, the goals create the vision, and as long as the vision's in alignment with your core principles, like it just it distills so much clarity into it. It's incredible.

Mike DeHaan: [33:12] Yeah. Yeah. And as you've shown to right, same thing translates across building a real estate portfolio, running your flipping business, buying bookbinding businesses in a different city from where you live. It's all all the same things for a compound on themselves. Right? Yeah. I guess one thing before everybody that's listening to this stops listening to collecting keys and starts caring about real estate altogether and just goes and pursues buying businesses. That's I talking about the basic numbers. Do you think that it is a wise move for somebody with no business experience to be trying to do what you do? Because something that I see so frequently, and honestly it kinda bugs me because I feel like it's out of ignorance and people don't understand the challenge and the risk that they're taking, is all the time I see these people saying, I wanna buy a business so that I can leave my w two. My goal is to buy cash flowing businesses so I can make 10,000 a month and leave my w two. They talk about like they're buying fucking duplexes. Doesn't make sense to me, unless I'm being ignorant. Like, do you think that that's an appropriate thing for people to try and do, or should they maybe use real estate as like the gateway to build that bank account, build the skills to run a business, or does real estate not need to be involved at all?

Drew Wiard: [34:24] Yeah, I think there's probably a million different scenarios and a million different answers to that question. I do think people are probably too cavalier about it. What you need to understand, you get an SBA loan, they're personally guaranteed. And so we've hit a couple of rocky places where our equipment dies and new equipment's $3,000,000 right? And if my business fails, they're coming for my house. And then it goes up to federal level and they can come for the assets and all the things they protected, right? So you are taking staggering risk to do this. The other point I would make, real estate could be a million different things, but if it's real estate like we all do, like this direct to seller business, you're already running a business. If you're not good at running this business, you're not gonna be good at running another business.

Mike DeHaan: [35:11] Say that again, one more time?

Drew Wiard: [35:13] Yeah, if you're not good at running this business, you're probably not gonna be good at running the other business. And I don't know how to say it more clearly than that. Maybe you find something that you're more inclined to do or you get more excited about,

Mike DeHaan: [35:25] but

Drew Wiard: [35:26] unless you just chose a market that's not doing well, I would tell you pick a different market. Don't go pick another business. Right, totally.

Mike DeHaan: [35:33] Yeah and it's such a, I think people, it goes back to the shiny object syndrome thing, Is they struggle in one thing, and they assume that they're magically going to be better at something else. And it almost gets thrown off people's expectations by the sayings of like, oh, all the great entrepreneurs have a graveyard of failures behind them. It's like that's true, but also they're typically kind of tangent to each other. Right? It's not like the person that failed at the bookbinding business went on and made an incredible, I don't know, started an airline or something, right? Yeah. And there's so many different ways that you'll approach it.

Dan Austin: [36:08] I think it's also thrown off by like, eloquent speakers that make it seem easier and simplified, because they're eloquent speakers, and that the point of good speakers like that are to get people motivated, they're on stage and they're on Instagram, they're all over the internet, and so they make it seem more simple than it really is. And sometimes it is simple, but it's freaking hard.

Drew Wiard: [36:29] For sure.

Dan Austin: [36:29] And it's not easy. Then you get back on that conversation we had earlier of like, you doing the right things? Are you choosing to do the hard things? And I think a lot of people don't choose to do the hard things. They don't want to.

Drew Wiard: [36:39] Yeah. And I think in this example, at least my business experience, is like, I did not know what all the hard was gonna be. I knew it would be there, and I knew that I had the constitution to stand against it, but I did not know some of the hurdles and some of the terror that was gonna come from moment to moment.

Mike DeHaan: [36:56] And

Drew Wiard: [36:57] That's why I say a lot of personal development has happened to learn how to stand against those headwinds. You know, the other thing is like, I am grateful for my partner. I have told him, I would never wanna do this without you because he's great underwriting, he's great technically, he has an engineering mind and machinery and Whereas stuff like I take care of all the people and the HR, and we had to let someone go this past And she's been with us for ten years, not a bad person, just not gonna be a good fit for where we're going. And some people don't have the stomach to handle that situation. So I think you need to be really calculated with whether or not you should be acquiring businesses and not just learning from the influencers. I think you need to go talk to entrepreneurs who have been up to their ass in alligators and ask them, what did it take for you to survive this?

Mike DeHaan: [37:48] Wow. Classic Indiana saying, up to your class, up to your ass in alligators.

Drew Wiard: [37:53] Yeah. Yeah. Because we have so many alligators here.

Dan Austin: [37:55] Yeah. So classic. Heard that one all the time. Yeah.

Mike DeHaan: [37:58] Yeah. Awesome, man. Well, super, super cool. I really appreciate all the the details you shared there, Drew. And it's it's fascinating to see, I would say like how, I know it's new to you, but like how confident you seem. I mean it's obviously you're well studied in that you're going through the trenches. And I'm sure that you've kind of gone to the learning curve. Have ever seen that

Dan Austin: [38:18] where it's like, when you

Mike DeHaan: [38:19] first start it's like, oh, I think I know a lot, and then once you're into it, you realize you actually know very very little.

Drew Wiard: [38:24] You know shit.

Mike DeHaan: [38:25] I'm sure you're in that that phase pretty heavy right now, but that's very awesome, man. So cool. So we're gonna dive into our end of show questions here. Alright. So the first one, and we'll give you a little bit of leeway on this as well since you've been a business guy, not just a real estate guy for the last eighteen months. Yeah. But what is your craziest real estate or business story? And no telling stories about finding a dead person in a property because I forgot to say that when we interviewed yesterday, and of course that was a story That was, I And that was my story.

Drew Wiard: [38:55] Yeah, you played the game long enough, you're gonna have some dead people unfortunately.

Mike DeHaan: [38:57] Definitely happens. Exactly. Yep. Yep.

Drew Wiard: [39:00] And so just as a clarifier, I've been in business a lot in the last year and a half, but I've been buying and acquiring. I've got commercial properties for sale, and we've been doing ten thirty one, so I'm still playing the real estate game. It's just not 100% of my focus at the

Mike DeHaan: [39:13] moment. But

Drew Wiard: [39:15] yeah, I can give you a story. I better get a cartoon out of this, though. Yeah, we'll see how it goes. We'll see if it lives up to the hype.

Mike DeHaan: [39:21] Animated adventure, Once

Drew Wiard: [39:22] upon a time in the land of Indiana, Drew bought a duplex, and it came from direct mail once upon a time, back before all the cool kids were doing it. Great little duplex, kind of a sleeper community out of my main market. Really excited, but I inherited two tenants. They were both just god awful. One side was a hoarder, and not super gross like bugs and rodents, but just so much crap in there. And I had to rehab this unit. He was paying like $400 a month or something, and it should have been $8.50 or something. So we go into this hoarder house and John and I come to agreement. I serve my first, not eviction notice, but like thirty day move out, end of notice, right? Notice to vacate. And so he's vacating, he's getting all of his stuff out, he's very agreeable, but he gets down to like the last little bit, and I go to get keys from him that day, he's freaking out. He can't find the cat.

Mike DeHaan: [40:13] Alright. Well, how

Drew Wiard: [40:14] can I help? Where's the cat? Where's the cat? And I said, well, maybe it ran out when you were packing. No. The cat hasn't been outside for, like, eight years. It does not wanna go outside. Oh, no. But he can't find it. So I say, okay. Well, you have to go. We're here to take keys, but I will put some food outside for it in case it ran away because this house was empty. And I mean empty. There's no way that this cat is hiding somewhere in here. It can't be. So anyways, he leaves. I run to Taco Bell to eat a real classic Indiana dinner, come back. There is a pile of cat shit in the apartment. I'm like, you've got to be kidding me. Where the hell so I'm looking in the closets. I look even in the attic access. Like, I cannot find this cat, but it's there. I said, okay. Well, can't explain it, but I gotta go home. Come back tomorrow, two more piles of cat shit in different parts of the house. Like, it's driving me nuts because this cat is here, or else the ghost of the cat is here somewhere just pooping everywhere. Yeah. Exactly. It's just doing it to piss me off, and I cannot find this stupid animal. And the place is locked up. The windows aren't open, the doors aren't open, there's no cat door, nothing. So I went and get a live trap, I don't hurt it it shows up, but you put some cat food in there and trap it. And I dropped it off. I ran to my in laws. I came back like in twenty minutes, and this mangy, disgusting cat was in this cage.

Drew Wiard: [41:34] Oh. My only guess is, and I hadn't thought about it up until this point, but this cat was huge. And I'm talking like big, puffy Persian, probably a really nice cat, actually. Massive cat. It had to have been down in the ductwork underneath the house, running through the ducts somewhere. But we had even put flashlights down there. There's no sign. So anyways, we had ghost cats in the ductwork and A shitty ghost cat. Shitty ghost cat. But we got it back to John. John was elated. Story ended up happy, and I still own that duplex.

Dan Austin: [42:05] Yeah. That's a happy ending.

Mike DeHaan: [42:07] It is, happy ending and you got a great deal at the end of it too.

Drew Wiard: [42:10] Yeah, no dead bodies in that one either. Yeah,

Mike DeHaan: [42:13] that's a good one. That's That's a good good my wife and I moved out of our first apartment, we thought we lost our cat. Same thing, it was like completely empty apartment. My wife, I was like, had some friends who were helping us move. My wife was literally sitting in the living room weeping, like putting together like lost cat signs, and then the cat comes like chirping out of one of the bedrooms. And still no idea where it was. Like the entire apartment was 100% empty. And he Oh must my have like squeegeed up against like the corner in one of the closets or something and just waited. Because we even talked to him anyway.

Dan Austin: [42:48] Dude didn't wanna leave, man.

Mike DeHaan: [42:49] Yeah. That's a good bunch of That's good

Drew Wiard: [42:51] a very,

Mike DeHaan: [42:51] very good story. Alright. Next question. What is your number one tip for a small time investor looking to take their business to the next level?

Drew Wiard: [43:00] Man, that's a good question. So much of my investing has evolved so much over the years that it's been a long time since I've been that first time investor. I tell you what, I'll tell you what I'm teaching my kids right now, because I have four kids, my oldest are 23 and 19, so they're getting out into the world and all that, And we are working really hard to talk about house hacking and all that kind of stuff. I think if you haven't made your first investment or there's an opportunity for you to live in one part of a duplex, triplex, fourplex, I would give anything to go back and do that as a young person. Even with today's interest rates, even with how expensive as it is, I think I'm gonna wind up selling my son one of mine, and I'll probably do the other for my daughter as well. We'll see. But I know it's tough to know whether or not house hacking has just been like this hype word and it's just the flavor of the year or whatever. The fundamentals are just spectacular, you will not regret it.

Mike DeHaan: [43:54] Yep. Yeah, Thanks. Great advice. It's a great

Dan Austin: [43:56] way and if, I always think that too. If I could go back and start over, I would have, had I known real estate was a great investment when I

Drew Wiard: [44:02] was 19 in the military, I

Dan Austin: [44:04] would have bought a bunch of houses and rented it to a bunch of military people. Because the best part about that back then is if they don't pay the rent, you just call the military base and say, hey, dude's not paying his rent, and they

Mike DeHaan: [44:14] make sure you get paid. Yeah. I think we just probably spin it kinda wrong to young people, to talk about how it's gonna set you up for the future and building wealth, but they don't care about that. Instead, if you like let them know that it will bring their expenses to zero so that they can purely focus on their craft of being a Twitch streamer for eighteen hours a day

Dan Austin: [44:31] or beer pong athlete,

Mike DeHaan: [44:33] they don't do that shit anymore, man.

Drew Wiard: [44:34] Oh, really?

Mike DeHaan: [44:35] Cities don't drink.

Drew Wiard: [44:36] Yeah. Straight edge.

Mike DeHaan: [44:37] Seriously.

Drew Wiard: [44:38] It's funny you say this because my daughter, who's 23, is an influencer, and she makes Yeah. Deep into the 6 figures just Wow. Perfumes her thing. And she has all these contracts with L'Oreal and Sephora and New York and LA and all that kind of stuff, so she, yeah, she doesn't have W2, that's how she's doing it.

Dan Austin: [44:56] That's how she's doing it, that is so cool.

Mike DeHaan: [44:57] That's awesome. Mean, Gary Vee said that forever about how a lot of businesses, they need to understand that if you're expecting these young people to come work for you for $50 a year anymore, it's like they're not gonna do that. They can stay at home and make $60 a year on TikTok. Honestly. Yeah.

Drew Wiard: [45:13] That sounds dumb, but I can tell you being in the labor market right now, the labor market in the first year that we owned that business was agonizing.

Dan Austin: [45:20] Trying to able to

Drew Wiard: [45:21] work. It's starting to come back a little bit, but it's there's something to it for sure. It's tough.

Mike DeHaan: [45:25] Yeah. All all the TikTokers that don't have the the fine privilege, they're just like, I guess I better get a job. I I've learned lessons about myself.

Drew Wiard: [45:33] That's right.

Mike DeHaan: [45:34] So alright, Drew. Yeah. Where can people find you, follow you, and reach out to you?

Drew Wiard: [45:38] At the flying investor, both on, like, TikTok, Instagram, and you can catch me on Facebook. Facebook Messenger is probably a decent place to find me as well.

Mike DeHaan: [45:47] There you go. Perfect.

Drew Wiard: [45:49] If you

Dan Austin: [45:49] guys want some more of

Mike DeHaan: [45:50] Drew as well, you can go and check out Collecting Keys episode 97. And he will dive even more into his real estate stuff that he used to do eighteen months ago, but now does still does, but does less of because he's focused on taking over the Detroit bookbinding mafia, whatever you're building out up there. Money laundering business. The money laundering business. Yeah.

Drew Wiard: [46:10] All of what it is.

Mike DeHaan: [46:11] Awesome. Well dude, thanks so much for coming on the show. We really really appreciate your time. And you guys, remember, people come on these shows because they want to engage with you, they want you If to reach out with they really didn't wanna talk to anybody, they wouldn't go on a podcast or put anything on social media. So don't be shy, Hit up Drew. Ask him your questions about buying businesses, and he'll tell you if it's a good idea or if he thinks that you should just stick to your day job. He's a pretty honest guy if you can't tell. So we appreciate you all listening and talk to you guys next week.