Do you feel like you're working hard but not getting ahead? Dante was in the same boat until he found real estate investing. He's now a successful investor with 7 general partner deals for over 2,000 units and he can teach you how to do the same. You don't have to keep struggling – there are steps you can take to become more coachable and resilient so that success becomes inevitable. Imagine what it would be like to wake up each day knowing that you're doing what you love, and making money while you sleep. That's the life of a successful real estate investor – and Dante can show you how to get there. Listen and learn!
Table of Contents:
- Where To Listen To The Podcast
- A Coach Turned Investor
- Being Coachable Can Earn You Credibility
- Why It Pays to Be Coachable in a Very Competitive Market
- Being Coachable Helps You Get Into the Industry
- 40 Hours of Being Coachable Are Not Wasted Hours
- Putting Together a Coachable Team
- The Most Challenging Months
- How to Reach Dante Andrade
A Coach Turned Investor
Darin: Dante Andrade lives in the DFW area. He was a musician spending his time teaching the children of wealthy families, trading his time for money. One family inspired him when they went on a three-month vacation. He wanted to learn how they could afford to do that.
So he then became a coach within the Brad Sumrok multifamily mentorship group and saw the success of the students, and he started to invest himself. He since started his own company, which has grown to 45 employees. Dante Andrade, appreciate you coming on the show.
Dante: Thank you, Darin. Excited to be here. Been a listener for quite a while now and you do a great job interviewing. I'm really thrilled that I got invited here to talk to your audience.
Darin: Just a little bit on how I know Dante. I joined a multifamily mentorship group, the Brad Sumrok group, about four years ago. Dante, at the time, was one of the buyer brokers within that group. I guess he got the penalty of having to deal with the new guy because he went with me on a lot of property tours. He really helped me get my feet wet in the business. So it's exciting for me to have him on the show here today.
Dante, not only are you a broker within that group, but you've also started to invest yourself and build a company. How many properties and how many units are you currently invested in?
Dante: Currently in seven properties, just shy of 2,000 units. I've sold one before, selling another one right now, and selling a couple more.
Collecting the Benefits of Being Coachable
Darin: That's seven properties all as a GP?
Dante: Yes, all GPs. I have probably 20 plus that I'm LPs in, but I usually don't count those because you just send the money. You collect the benefits, you don't do anything.
Darin: There's nothing wrong with that, though. It's a nice benefit.
Dante: Actually, the more deals I get as a GP, the more enticing becoming an LP. I actually set myself a timeline that I feel like I will probably sell everything and just be an LP. That's truly passive investing. As a GP, you're still doing a lot of work. You buy yourself a job. It comes with a lot of perks and has some freedom, but at the same time, it's still a lot of work. I love being an LP. Usually, my goal is to invest with people that I trust. So I look at the underwriting initially.
I know if they have skin in the game. If I know that they're invested, "Here's my money. I don't read the reports, you don't need to call me. You don't need to do anything. Let me know when we're refi-ing or selling." That's usually how I handle my passive investors. They've done great. Lots of them selling this year. Had some exits earlier this year. So sitting more cash than I wanted, I think probably 23 because I was doing taxes. I went through the K1s. I'm probably 23 deals as a passive and it's been great.
Darin: We've got a mix of people that are passive investors and people that are interested in getting to become passive investors. Some of those people are scared to jump off the cliff and a lot of syndicators are looking to scale.
Darin: That's the listener base, typically. Let's spend a lot of time talking about your deals. Before we get into that, I mentioned that when I met you, you were a broker within the group. That may be new for a lot of listeners. Can you share what that role looks like and what that entails?
Dante: It's very unique. In residential commercial estate, you always have a seller, a broker, a seller realtor, and a buyer realtor. But in commercial multifamily, it's not very common. Usually, you have a realtor, the broker that's representing the seller. On the buy side, people are just representing themselves.
Brad Sumrok within his program decided since we're taking in a lot of people, they are beginners. They are new to the industry and to the market. We wanted to offer a higher level of service catering to all the needs of the clients. So we put together the brokerage program, which is here in Dallas Forth Worth. It's run by me and my partner in the brokerage, Tom Lafferty.
Really, our job was, and this is at the beginning also, the first few years of Sumrok not as the massive name that it has become today. Our job was really convincing the listing brokers and the sellers that they should award the deal to us and not to whoever we were competing against. But our interest has changed a lot over the past eight to 10 years. Initially, there were a lot of just old school guys, old school money that they do deals with two or three friends got together. Whenever a syndicator showed up, a lot of sellers are like, "Oh, no. I don't want to deal with syndicators. What is this? Is this a Ponzi scheme? What is that?"
How Brad Can Change the Life of a Student Who Is Coachable
Dante: Brad has done a great job changing that in the industry. There was a part of it that was really convincing the brokers. Our job was to go network, talk to the brokers, build trust, and build relationships. I joke with one of the brokers, which whom I'm pretty close friends today. When I used to call him back in 2014, he wouldn't even pick up my phone. He’s like, "Who is this random person that has nothing to do with multifamily calling me?"
Until one day, someone in Sumrok was doing something wrong and then he is like, "I'm going to call that guy that always calls me." He called me back and I jumped to fix this problem. Then from there, we developed our relationship. Today, he's a close friend of mine, and we've done tens and tens of deals together.
It's been rewarding coming from a place where no one knew who Sumrok was, no one knew who Dante was. Now we’re getting the trust that if we're competing against another person, even if the money is equal, everything is equally based on the relationship. In the deals that we've done, we have the upper hand many times, and that's what we offer to our clients.
Just to give you some numbers, over my career over the past eight years now being a buyer broker, I've closed over 130 transactions. Even if you look at the very successful players in this space to do 130 transactions, it's a massive number. It usually takes decades to do that. It's a lot of hours, and a lot of experience, but it's over 1.5 billion in value.
A Real Estate Investor’s Journey
Dante: Of course, we started at $30,000 properties, 28,000, 32, 35,000 a door all the way to 200 something thousand a door. That's stuff that we did earlier this year and last year. It's just been a journey. I learned a lot about what to do, what not to do, and in all sides of the transaction. We have a lot of repeat clients, even people that have done a lot of deals that come back to work with myself and Tom. It’s just because of the knowledge that we accumulated doing all these transactions, and when things go wrong, we've probably been in that situation before.
What we do is really represent the buyers, holding your hand through that process, helping with strategy, and that's really why I do it. I joke with some of the brokers. Actually, by the time the deal closes and I get paid a commission, it's not really exciting anymore. But it’s getting the deal done and getting the deal awarded. I'm a very competitive person, especially if I know who I'm competing with. That's become our strategy when you have a really competitive market. How to make that seller and that broker comfortable with my client. That's really what drives me to still be doing the brokerage and it's a part of what I do that I really enjoy.
Darin: You said so many different things. I remember when I was completely new. One, it was nice having somebody on my side. It was nice being part of a group. When I called the brokers, I could hear it in the back, I could hear it over the phone.
Being Coachable Can Earn You Credibility
Darin: It was silence, but I could hear it. They would ask me, "What do you own?" I say, "I own my personal residence." They put me at the back of the line. I could hear them do it. Once I say, "I'm part of the Sumrok group," I could hear it change. There's automatic credibility. That is what Brad, you, and Tom built up. Then new people like myself that came into the industry were able to ride that credibility. It would've taken me so much longer to break in and get successful if I didn't have that.
In addition, you would go on property tours with me, and I would say, "What would you do? What have you seen other people do?" That was helpful because a listing broker is going to provide a consultation. You're going to ask the listing broker as well, but you know that they're trying to get the sale. Having another person that you feel is on your side gives you definitely some comfort.
I agree with you on the competitive side. It doesn't matter if it's this. It's like any type of sale. I've been in a number of different sales positions. When you get the deal, that's the most exciting time. Then you have to do all the contracts and all the BS that goes along with it. By the time it closes and you get paid, some of that is worn off. Talk about the benefits outside of being a broker. Building those relationships with the brokers, I'm like, "That is priceless." When you switched over and started to buy your own deals, how did that help you?
How to Be a Syndicator
Dante: Tremendously. My goal from the very beginning because I joined the Sumrok group, like yourself, is to buy multifamily. Learn how to become a syndicator and buy multifamily. The brokerage just happened really randomly in a conversation with Brad and his wife, Jen. I wanted to be more involved and to be full-time in this and I felt like this is another opportunity. So I love challenges, let me do this. I begged Brad at the time and he was like, "You don't have any experience. How are we going to do this?" But he gave me a chance and I proved myself to be valuable and learned things along the way.
So building those relationships. So I've always wanted to buy properties and I did start buying back in 2015, but my focus was so big on the brokerage. That's what really excited me because of the competition. We were growing and the Sumrok name was getting well-known. People were joining and we're having qualified, smart people like yourself joining and they were fun to work with. So buying deals went into the background. I have a very strict policy also. If I'm looking at a deal with a client, I'm not going to be pursuing that deal personally.
I had to early on carve out a deal if I was going to look at it and let the clients know. I’m like, "I'm pursuing this myself." So it became tricky. I ended up not buying much in 2016, and '17, and helped a lot of people buy and saw the progress in there, essentially. So many people were known to create big companies and own thousands of units.
Acquiring a Deal
Dante: I said, "Hang on a sec, I got to find some balance between those two," and decided to focus more on acquiring a deal. That did play a big role and I feel it does up to this day because the first was changing, letting the brokers know, "I also buy deals." I said, "I can actually raise equity," and then managed this up to this day if I'm pursuing a deal. What I tried to do is to stay a little ahead.
If my clients were buying 15 million dollar deals, I was looking at 20-25, but everybody kept moving. Then I ended up with clients buying 100 million dollar deals. I've never done that before. The biggest one I've done is 80 million. That was the latest acquisition just July, two months ago. So I couldn't at the time. I tried to stay ahead and that didn't work for a while. It was just really after that honing down.
We were working with a ton of people also in the group. Over the years, I've narrowed down the groups that I'm working with and really spending time with the ones that I know are ready. They’re going to get the deal done. But leveraging those relationships played a big part.
I felt like I already had the trust of the brokers and I told them, "Just like my clients, I can also raise the equity." It did help a lot in getting deals awarded up to this day, it has leveraged into relationships with sellers. As you know, our industry seems massive, but it's actually pretty small, especially if you're in DFW. Pretty soon, you would know pretty much everybody who's in the business.
Being Coachable and Building Relationships
Dante: So doing many deals with different sellers that Sumrok was buying properties from has also helped me. It got me to a place where I will know a lot of the sellers that I'm bidding on properties for myself and for my company. Definitely, those relationships have helped a lot.
At times, people have asked, "How long are you going to continue to do the brokerage?" It's like, "I don't see myself stopping doing that as long as I feel like I'm providing service and value to my clients." One, I love it. I love the competition. It helps me stay with my post in the market. Even if I was acquiring a lot of properties, it would be, what, 10 transactions? Let's say I acquire 10 deals a year, it's a pretty big number for a syndicator.
This year, probably going to do over 30 deals within Sumrok and it's a slow year. Having just that exposure helps me keep up with my pulse on the market. Knowing exactly how offers are going, where deals are trading, and how brokers are on the right because each broker's approach is different. You have the guy who owns the prices, so he can create competition and the property gets beat up. Then you have the guy that overpriced showing the listing.
You have all these different personalities and styles and they change and being active. So we're submitting offers nonstop. Just as we're talking over here, right now we have five deals on the contract. We have one other being awarded and I probably have three or four LOIs out this week for clients. It's a very slow time as you know right now in our industry.
Listing Brokers With Different Strategies
Darin: What Dante is saying is true. It takes a little time to understand it, but the different listing brokers have different strategies. First of all, these deals typically don't have a selling price. It's based on the market, but if you call the broker and ask for the whisper number, they'll give you a number. Some brokers always give a very high number and you could never get there. Other brokers keep it low because they know that a lot of people will be like, "This one looks like it's a good deal." Then it'll get a bit up above the whisper numbers.
The other thing that you said about the sellers, so I tell people, is to think about the end when the seller and the broker are having that conversation. There are three buying groups. Who should I go with? I always think about the broker who has a relationship with the buyer. You bring up another great point. If the seller already knows you and the sellers like, "I know Dante. I know he'll close. Let's give it to him." That's one step further, that's phenomenal.
Dante: 100%. I've had that happen personally and also within the group. As someone new, either knew me or knew the buyer and said, "That person has the priority just because I trust and I know that person outside." It has happened to me personally. A seller actually comes to the broker and says, "If Dante is competitive, the deal is his." Of course, that doesn't mean I can get the deal done for a million-dollar discount. The friendship is not that strong.
Darin: The numbers still have to be there, but there's only one person that gets awarded the deal.
Why It Pays to Be Coachable in a Very Competitive Market
Dante: Yes, and how many deals end up with several offers all at the same price? A very competitive market like we have.
Darin: All within 100 grand or something.
Dante: That time really is the relationship and your reputation of what's going to matter the most.
Darin: You just said that you did an 80 million dollar deal. I didn't even know that you had done that deal. That's phenomenal, but there are some listeners that are like, "This is just so far out of my league." Their mindset is, "I could never get there." Share with the listeners your background before you got into this.
Dante: My degree is actually in piano performance from the University of North Texas, and I had a career being a professional musician. I played piano professionally, worked seven days a week for 10 years straight, and had a thriving business teaching private lessons. So I was very fortunate that I ended up with a business and a clientele in one of the wealthiest areas in DFW. A lot of my clients were extremely wealthy business owners with private jets and massive homes. I got to work with their kids and get to know their families and worked with a lot of them.
Darin: No wonder you could raise the capital.
Dante: We can talk about that, but it's funny how it's coming full circle. I never thought that my music business would have emerged and now have a lot of my former piano clients. They are now my investors and want to do more. It's been an exciting journey, but that was my background.
An Inspiring Background
Dante: I always had my mornings and early afternoon free, read Rich Dad Poor Dad when I was 21 years old. Real estate was always in the back of my mind, the more I got to know these families. Really, what inspired me was one family that, beginning of the summer, right at the end of the school year, would say, "Dante, it was great seeing you. Thank you so much. We're going to the Hamptons now. I will be back in August." They would leave with all the kids and go to the Hamptons. Maybe take a trip to Europe in between and come back in August.
They would still pay me for all the piano lessons throughout those months because I had a very busy schedule. If they didn't pay, I would have to replace them, but I'm thinking, "Wow. They can leave for three months, two and a half months and business continues." At the time, I was making good money. But if I was not teaching, if I was not at someone's house, if I was not at the Batchelder family home at 7:00 on Tuesday night to teach those kids, I was not making money.
So going on vacation was not even about the cost of the vacation. I always look at how much money I am going to lose. That was always a drive. At that time, I was self-employed. I didn't have a boss and I enjoy what I did, but I had a limit. There were only so many hours on the day, on the week, and I had a wedding and corporate gigs on the weekends. I worked at a church. At one time, I worked at three different churches on the weekend playing.
Dante: There were only so many hours in the week. So I made money, saved, and always lived by my parents' model. It’s the Dave Ramsey model of saving everything, living below your means, don't take on that. Drove at 19, I was still driving, and I think I was still teaching, started teaching. I still have a 1994 Honda Civic that was withheld damaged.
Then I would be showing up at a 10 million home to go teach these wealthy kids, but it's already taken. But I was saving my money because I knew I wanted to invest and started really just looking at condos and houses. I thought I was going to flip a few houses to make a little more money on my mornings that were usually free.
That's when I did a few of those, probably two or three flips with a contractor that knew how to do the work but didn't have any money and I had money. We bought it for $20,000. Just to give perspective, my first real estate purchase was $17,000 cash. Then I spent another 5,000 on remodeling and split the profits with the contractor. Did that a few times.
But I kept learning, reading books, going to meetings, learning about Brad Sumrok, and started following him. He was still with his previous company, it was before he started his program. I'll go to the meetings and listen to him.
Really, Brad helped change my mindset that I joined the program thinking, "All right. I have a little bit of money saved. I'm going to come in and buy a 12-plex, maybe a 20-plex with a couple of other people." That was my mindset.
A 2.3 Million Dollar Acquisition Price for Being Coachable
Dante: Brad at the time said, "No, you're not going to do that. We're actually going to get you at a much larger deal." I went from thinking of doing that. My first deal was 75 units, a much different number than the 80 million we just talked about. That was a 2.3 million dollar acquisition price and I raised a million dollars from people that were in the group.
I didn't tell any of my piano clients or any of my real friends because I thought I didn't want to mix things. What if it doesn't work out? I don't have those different worlds mixing, but I was really afraid of raising the capital. That was the easier part of getting the deal done. The million dollars came really quickly. People understood the opportunity. That was the first one, a very challenging deal. I was pretty much every day at the property at the beginning. Lots of challenges.
At one time, it took nine months to close that deal just you can understand how challenging it was, but I saw the opportunity. I saw what I was buying, and it really comes down to seeing the opportunity. Then I saw a property that was across from the elementary school, catty-corner from a hospital at a major Cooper Street in Arlington.
It’s a major street with six lanes of traffic nonstop at the school zone. Everybody had to slow down in front of the property. Here's this dilapidated building, neglected, being run by an operator that didn't care because it was all in cash and collecting. I just saw the opportunity, "This is a lot of value sitting here," and I stuck with it. It was totally worth it.
Being Coachable Requires a Mindset Shift
Darin: You said you saw the opportunity and the value, but I think the mindset shift happened first. That's so big. Until you can believe that you can achieve something, you're not going to do it. To have somebody change your mindset from going after a 12-plex, which is a 12-plex or a 20-plex, for a lot of people is still like, "That's huge!" Then all of a sudden, you're getting involved in a 75-unit deal.
Now you just did an 80 million dollar deal, but it doesn't happen unless you change your mindset. Talk about how you went from where you were. A fantastic client base, but trading your time for money to have a mindset that you could actually buy these large multifamily properties.
Dante: I agree with you. It's all in the mindset. Even though I was already in the Sumrok program as a student coming to the events, my mindset wasn't still there because I grew up in a middle-class family. My parents weren’t wealthy, my dad was an accountant for a public oil company in Brazil. That's where I'm from originally. We lived below our means and had a decent life. But we didn't have any wealth. We didn't drive luxury cars or anything like that. Now looking at millions, and I didn't have 2.3 million or even close to that when I went to look at that property.
Darin: You've seen all these other people be successful.
Dante: 100%. Every time we had a bus tour or had an event I would go and see, "That person just bought a 90 unit. Wow," and then you hear their story. You get this jolt of energy that you can do it.
Being Coachable Helps You Get Into the Industry
Dante: It gets to the point if you've seen a few, it's like, "I talked to that person a few times. I'm way smarter than him and he just bought a property. I think I can do that myself." So really, that got me there at that time, which is not that long ago, but there weren't as many podcasts to listen to as we have today. The great service that you've been providing to a lot of people that are curious and they're learning and wanting to get into the industry.
So I'll go to these meetings. I'll be at the Sumrok meetings. Sometimes, I'll be at different ones if I could just be around people. I wanted to hear the success stories. That helped change my mindset, really seeing others that I could relate to. If you tell me, "The multimillionaire person just bought 30 million," I cannot relate to that. I was a musician running a business, self-employed, that had some savings.
Give me someone that has more of a normal life like myself. I really got to see a lot of that within Sumrok and being around and chasing. Anytime there was a real estate event, I'll be around and listening, and helped me change my mindset. Then I was comfortable looking at 75 units at 2.3 million. I’m thinking, "I can actually get this done and turn around and make a ton of money for my investors."
Darin: I remember the first bus tour that I went to that was just students, and I came home and I told my wife, "That was the craziest thing I've ever gone to."
If You’re Coachable, Anything Is Possible For You
Darin: She's like, "That was a business thing. What's so crazy about it? I'm like, "It's 250 people. Everybody had paid to be part of this organization and everybody in the room either wanted to invest in multifamily or wanted to be a syndicator in multifamily. It wasn't anybody else in the room." I walked home with 100 business cards, I couldn't believe it. It was just crazy, mind-blowing. So surrounding yourself with other people.
When you get in a room where people are like, when you go to one of Brad's events and he is calling people up, "Stand up. Tell everybody what you just did," and you hear 250 units, 125 units, 300 units. I had the same thought as you, "These people are smart, but if they could do it, I could do it." I want listeners to understand that it's possible for you. It's not out of this world, and it's not out of your realm, but it's also not easy. You can't just stroke a check, join a club, and a deal shows up at your doorstep.
Dante: I've been on the inside track of Sumrok and seen all the people that joined and had so many people coming. You know at the beginning before you got your first deal, how many tours did we go to, how many no’s you get to be getting that first yes?
Darin: You have to have thick skin because you're going to hear nos, for sure.
Dante: We have a lot of people. What happens in a lot of multifamily, I think in real estate in general, we have people that are really successful in their industry.
Multifamily Is Not a No-Brainer
Dante: They've done a lot. It could be physicians, business owners, or whatever it is. Sometimes they have an exit, so they have capital, they have money, and they've done it. Then they'll come into multifamily and feel like, "This is a no-brainer. I just need to write a check. The deals are going to show up," and it doesn't work this way.
It's a very relationship-driven business. You have to put in the time to be able to know who the players are, know the decision makers are, having money. Everybody has money. We ended up surrounded by a bunch of people with money. Money is the easiest thing to find when you are in a circle of people that are doing real estate. That's a misconception that I see happening a lot.
To your point, a lot of people think, "Oh, I have money. I'm going to join the program and it's just going to happen." Now, if you don't put in the work, it's not going to happen. I've seen myself, a lot of people come in, dream big, joining, but then sometimes life gets in the way. Well, sometimes it's just too much work.
Really, it makes me sad when I see someone go once, twice, three times and they're so close to getting their first deal and they're like, "All right." Just throw the towel. The holidays come and they get distracted and then they never showed up again. It does take work and gear. I know you've talked about this before on some of your other interviews from zero to one, it's the hardest part. From one to two to three, it becomes a lot easier.
Coachable People Are Successful People
Dante: You face different challenges at times, but zero to one, it's a mountain, it's Mount Everest. Once you can get over it, every other mountain will be a lot easier to get through.
Darin: You've been doing this for a while. Do you have a good pulse on this guy or this girl who is going to be successful when they join? I'm sure you get some of that wrong. Some people you think, you may judge them and say they're not going to be successful and they are and vice-versa. Can you pull out the characteristics of the people that are successful, what's the difference between them and the ones that fade away?
Dante: The number one thing that I would say that has made people that I've seen of a trend, people that are successful, they are coachable. They're open to feedback, they're open to criticism. That's number one.
It doesn't matter how smart you are, or how much money you have. If you come in and you create, we all create. We look at the world differently and create perspectives and images of how things should work in our heads. Sometimes our background is influencing that.
If you're not open to getting coaching, it could be from a podcast, a mentor that you hire, your buyer broker, a colleague, or someone that's ahead of you in the industry. Being able to be coached and open-minded to say, "There is a different way of looking at this, not only the one way that I learn." Even if it's not because you're hard-headed, it's just because you learn this one way while there are different ways of looking at things.
How Resilience Can Help You Win in Real Estate
Dante: Getting coached by your lenders, also. They have seen a ton of deals, they're involved. They're great sources to be learning from at the same time. I would say that's number one. People that are resilient. They're not willing to give up. I would say getting to know and finding a deal, underwriting, putting in all the time, getting to the offer, then you submit the offer. "Here's best and final," and you would put in another 10 hours doing best and final.
I tell people, in the beginning, it's going to take you about 40 hours for you to get a deal. From looking at it, touring it, all the way to being competitive and best and final. Now, 40 hours seems like, "It's just a work week." No, well, you probably sometimes have another job, you have a family, you have kids, school, and other obligations. You have your life and you have to find 40 hours on top of that to do that.
Now, imagine that you've got 40 hours and you get a call from the broker the next day. The broker says, "I'm so sorry, Darin. You made it so close. You're just number two on that transaction."
Darin: I've gotten that call before.
Dante: We all have. You invested 40 hours, you don't have anything to show, and you're number two. Sometimes the business is frustrating. Now, do that five, or seven times, and then you still. As long as you don't get a property, you don't have anything to show. So people that are able to go through that process and be resilient and say, "You know what? I'm just closer to getting to the next one."
40 Hours of Being Coachable Are Not Wasted Hours
Dante: It's something that I say to my clients and the people that I work with within Sumrok. Those 40 hours are actually not wasted because you learned a lot. You learned a lot about the submarket, about that area.
If another property shows up in the neighborhood and you've already written two or three that you lost, you didn't get what you awarded, but another one shows up. You already know the ins and outs, the city, the problems, and how much the water bill should be, you have all the knowledge. You're going to be able to make such a faster, quicker decision that all the work you put in may actually help you get that deal.
I've seen that happening many times to many clients we've worked with. It seems that you wasted the time and it's frustrating. People that are able to think a little bit longer term and know that the reward is not going to come right away, and I'll say this because I say this in front of him.
Brad sometimes will not give you all those details from the stage. That's going to take several 40 hours of underwriting, putting all this work before you get your first deal awarded. Many times, he's called in to stage someone that got the first deal awarded within three weeks of joining the program. That has happened in the past. I would say it's not the rule and it does take a lot of work.
It does get a lot easier after you get to the first one. I'll say key things, you're resilient and coachable, open-minded, open to criticism, that can adapt and learn from others.
Being Coachable Requires an Open Mind
Darin: I've never had somebody answer that with coachable, which I think is very telling because there are a lot of people in the industry that have experience. Whether lenders, brokers, buyer brokers, other owners, sellers, and buyers, they all can provide guidance. You don't have to take all the advice, but at least be open-minded. When you hear something that makes sense to you, run with it and engage with it.
I could also attest to what you said about learning. Sometimes you lose a deal. I remember I went on one deal with you, a property tour. It was the first deal I put an offer on. I didn't get it, and then I underwrote a lot of deals before the next one. Then I'm on another property tour with you in a different area. I had underwritten so many deals that I knew the expenses were just way out of whack. We could cut expenses dramatically, and I'm like, "How can we just lock this up right now?"
You had some advice and we went down that path. We didn't end up getting the deal, but we came very close. One, it was great to have a partner like yourself helping me. Two, I wouldn't have had the confidence, and that deal was twice the purchase price of the first deal. But I had so much more confidence because I had underwritten so many deals that I was comfortable with it. Talk about learning. Do you still learn or do you get bored with all these underwritings? How do you keep learning and keep pushing yourself?
Dante: Always learning and really taking time to learn from others. I just spent a day yesterday in Chicago with a coaching group that I'm part of, learning different things. Now, I have new challenges. I feel like underwriting and analysis and being able to get properties done. Now, I have a team within my company that's helping me with that. I have grown a business and scaled that business.
So learning from others all the time and the industry keeps on changing. If you look at six months ago exactly, March 23rd, that was a different industry than we have today. It has changed. A lot of learning has happened.
Darin: You're transitioning. You had the buyer broker. Now, you have seven properties, 2,000 units. You also have your own company. What's the name of your company? How many employees have you grown it to? Where's your focus today?
Dante: My company's Touro Company. Touro is the Portuguese word for bull. Our CM was similar to the Wall Street bull with a house on it. Tourocompany.com is a website that’s actually under development right now. It'll be ready here in a few weeks. We're at about 45 full-time employees. On top of that, some VAs and contractors work for us on a full-time basis. Decided a few years ago, from learning as we were talking about here, to be around people that are way ahead of me in the industry.
I was a syndicator, a one-man show and I used third-party property management companies to run my properties. It got to a point where I hired an analyst. So it was me and one other person trying to acquire more deals, at the same time helping with the brokerage within Sumrok.
The Real Estate Market Is Amazing
Dante: As I saw the market and the prices change, my mindset and from learning from others and people that are ahead in the industry. I came to the conclusion that a lot of the last decade from 2010 to 2020, the market was amazing. Especially if you're in DFW, Florida, Atlanta, or Phoenix, the market took care of any mistakes that you made. Even if you're not a good operator, it was really hard not to make money because the market took care of it.
In my own view, we're not going to have the same run from 2020 to 2030. That was my view back when I was making this decision back in 2019. I felt like operations were going to be key to the performance of these deals. The market is still going to be strong, especially if you're buying in good markets like the one that we're in. It's still going to help you, but you're going to have to paddle a little more than before there. Sometimes you just had to coast. So being on the paddle boat and just sitting there and letting the current take you, I think that current's going to be a lot slower. We're facing this right now.
So I was thinking about this 2019, and 2020 and making the decision to bring management in-house. I wanted to have full control of my operation and how my deals were going to perform. The bigger deals I was buying, the bigger the responsibility, and the more money from the investors. Something that I wanted to do is really learn from people that were ahead of me in the industry. I got to go on a ski trip with some amazing folks.
Hanging With the Right People
Dante: There’s a guy that owned 65,000 units. Another one owned 35,000 units, somebody else owned 20,000, 5,000, and then there was me. I was like, "How did I get invited on this trip?" But there was so much learning from that trip and I came back with a lot of lessons.
Darin: We talked about mindset going from 12 units to 75 units. Now, you're hanging out with folks that have 20, 30 thousand units. That probably just pushes your mindset to a completely different place.
Dante: I’m seeing what's possible.
Darin: So what do they say? Somebody that owns 60,000 units, 30,000 units, what were the one or two top things that they said on that ski trip?
Dante: The beautiful thing there is hanging out of these people, of course. They all flew in on their own plane or charter planes to this location. I couldn't tell who was who from the mix until I got to know them. We did not know each other when we got there, but thinking about they're just normal people. That really amazed me just these guys were so down-to-earth, so amazing.
One of them, I developed a friendship with and have been able to come back and have dinners with him and his wife and get to learn more from him. I have his company as one of the models of the companies that I want to be like when I grow up. They put infrastructures from the beginning in place. They all worked really hard. There was no easy, and they were explaining to me. They got nos and they got beat up and just heard so many stories. No one had it easy, no one inherited.
Putting Together a Coachable Team
Dante: Everybody had to work really hard to get what they were. Then it was about the team, and putting a team, and putting the right people around him. It was funny at times asking these guys questions about operations and property management. They did not know a whole lot because that was not their focus. They’re now the CEO of this massive company and somebody else was running property management completely.
That's what really came to me that it was much harder to do when you were smaller. My mindset start changing and I needed a team around me. I needed more people. To do it by myself and grow, would be a really slow process to do by myself. There are risks involved with that, yes. You have to front a lot of money without seeing the results, to have teammates, to have people around you, but that was a big lesson.
One of the reasons that drove me to bring management in-house, all of them had their own management. All of them had done it at our earlier stage when they brought management in-house.
Darin: That's great to share. At the end of the day, in the beginning, they've all learned how to take action, and yourself too. You could read books, and you could listen to podcasts, but if you didn't buy something, you wouldn't have pushed it to the next level. That's a difference. As you said, these are normal people. They're down to earth. When you're saying that, I'm thinking to myself, "Picture Dante 10, 15 years from now. Instead of owning 2,000 units, he owns 20,000, 30,000."
A Coachable Guy With 30,000 Units
Darin: You're going to say, "Look, this guy is a down-to-earth guy, he's a good guy. He's just a normal guy, but he took action, and he learned from others. He's surrounded himself, put himself in the rooms with people that were ahead of him, and he learned from that, and then he took action." So that says a lot.
It's not good enough just to learn that they put infrastructure in place and that they added a team, but you went and said, "Okay. They added a team and they brought in-house management. I'm going to do that," and now you're in the process of doing that.
Dante: I was talking to my life coach a couple of weeks ago and I hadn't spoken with her in nine months. She's like, "Hang on. I have the notes here from the last time that you're going to do this and that, and all that is done." She's like, "Let's pause here for a second, and just take the scene. Yes, you took action. You were someone that set a goal and you go after that no matter how hard it is and you took action. Let's stop and celebrate before you talk about these problems out there that you're looking at in the future." There is a great book called The Gap and the Gain by Dan Sullivan.
Darin: Somebody just recommended that and I bought it and it's here. I haven't read it in yet. I've read his other book, Who Not How. So this one's a good one?
Dante: It's a great book. It's a very easy read, but all entrepreneurs tend to live in the gap, meaning what's to come, what's to reach.
Chasing the Horizon
Dante: The way Dan explains it is that if you're standing here and you're looking at the horizon, let's say we're in a field. You're looking at the horizon.
No matter how fast you run toward the horizon, you are never going to get there. Why? As soon as you get closer, what happens? The horizon now has moved and moved. The sun's going to come down and you're not going to see the horizon anymore. You're still chasing it because it's going to be moving always. So he talks about that being the gap. Now, the gain is where you are before you start running.
When you saw the horizon, you said, "I'm going toward the horizon." You got to stop and look back and see, "Look at what I've gained for chasing this horizon," which is always going to be moving. You got to stop, think about it, and celebrate it. We as entrepreneurs have a tendency to always live in the gap. I thought I was the only one that was like that.
It was mind-blowing talking to others about it and reading that book. Just thinking about it, "Okay." So I've been teaching myself to stop, look back, look where I came from, and go back to 2012. Go back to 2014 where my goals were and look where I've accomplished so far before going back to chase the horizon, so going back to take action.
Darin: I'm looking forward to reading that book up. The other thing is when you started, you were thinking more about your family. Now, you have 45 employees that you're responsible for. You have all these investors that you're responsible for, and you're teaching all these people that come into the Sumrok group.
The Joy of Life
Darin: You're telling other people about it that are in your network. That's another thing that I try to tell listeners. Today, you're worried about getting that number one deal, that first deal, and that's where your focus should be, but know that two, three, four, five years down the road, when you are successful and you're on your third and fourth and fifth deal, other people are going to be coming to you and saying, "How'd you do it?" and you're be teaching other people, and that is part of the joy of life.
Dante: I look at it, Darin, sometimes as a video game. I'm not a big video game player, but I played as a kid. You're on this race, let's say Mario Bros. Then you collect all these coins and now you unlock the new level. There are things that happen at that level that it was not there for you. It was not there for you to see because you had not collected those coins. Let's say collected that knowledge or those actions.
Now you're at a new level. Sometimes now you get a plane or you can see the field. You can see now it's green and it's more beautiful. There are different things now that you can collect and gain at that level because you achieved them. So getting your first deal, getting your first house or investment, whatever it is that you're chasing until you take action and get the first one done. There are a lot of things out there that you are not going to see until you get to that first deal.
How Being Coachable Can Get You Your Number One Deal
Dante: When I acquired my first property, 75 units down in Arlington, there were a lot of things that I saw after that. Opportunities that I saw that there was no way for me to see them until I closed that. I became a much more effective broker for my clients once I was owning the deals and asset managing them. Being able to share those experiences and show them, "There is this opportunity here." Those are the things that you don't see until you've taken action and actually got your number one.
Darin: That's a great point too. As a broker, it's one thing to have all the experience going on in all these tours. But then to marry that with owning and being able to provide that advice, that's huge. So you are seven properties as a GP, 2,000 units. I know that you had to celebrate, but now looking forward, what's the next big stretch goal?
Dante: The stretch goal was going to be this year to acquire five properties. I had the team in place. I’ve taken over property management last year and everything was going well. I have a whole executive team helping me run the properties on the day-to-day operation. So I set a goal. This will be five properties.
I want to add another thousand units this year. That's the goal at the beginning of the year. We started out really fast. Getting one under contract and then a portfolio of two other properties, 524 units in Irving under contract. That's the 80 million dollar acquisition that I talked about, all at the same time. Life was not fun during that time.
The Most Challenging Months
Darin: So you had three properties, two different deals with three properties.
Dante: Three properties, 700-something units all at the same time. Now, as this was happening, the fed came out and were raising interest rates. The debt markets are changing. Our industry is having some massive changes when I'm in the middle of doing these acquisitions. Trust me, those were the most challenging months of my career. I just went through them right now.
One of those deals did not close, unfortunately. The operations at the property were not performing. The seller, unfortunately, lost all of the staff. Pretty much everybody quit right when we started due diligence and there had a lot of people about to be evicted.
The lender got really spooked with markets changing and here's this property that I don't think can afford the mortgage. So they re-traded us. I went back to the sellers and I still believed in the deal and tried to adjust the price. They were not willing to talk or have a conversation. Unfortunately, that didn't close. I went on to focus on the other two acquisitions, which we successfully closed on July 13th, not without a lot of stress, and a lot of sleepless nights thinking.
Dante: Thank you. Appreciate it. I paused at that time and I said, "I'm never doing this again."
Darin: "Until the next time." You'll forget it at some point and then you'll be like, "Oh."
Dante: I don't know if we're going to get to the five deals that I line up and I already reset the expectations with my team.
Being Coachable Can Win Successful Homeruns For Your Investors
Dante: I never want to be in a position where I have to buy deals. Every single deal that I've done, nine deals that I've bought and sell myself, have been successful home runs for my investors. I'm not willing to have if I have the choice and the control to have a mark on my portfolio, and my career. So I don't want to be forced to buy anything.
It's also challenging to manage the growth of staff in the company. At the same time, I want the market to give me the opportunities to bring me deals, and not be I have to buy. So many times, you have people with larger funds that raised a hundred million, and now they have to go and buy all these things and overpay. It’s not something that I'm willing to do.
I'm at a good place if we don't buy anything else. I would like to buy at least one more this year. I'm starting to look, but I'm not in a hurry. If it doesn't happen, it's okay. I think it's going to be a little bit of a slow time in our industry, even though the fundamentals haven't changed. People are paying rent.
I'm sure you experience that on your properties. They're fully occupied. Not having any issues we're increasing rents. But on the acquisitions, the sell and buy side, the debt changed. I think we're going to have a slowdown. I'm just spending time working off my team, making us better operators. I think we're going to need that as we go through the next decade of owning deals.
Dante: I'm planning some trips, and some time off.
A Balanced Life
Dante: I added more days of the week of working out and playing volleyball, which I love doing. Going on trips and planning more trips. So that's balancing and we just sit back and wait. We've had a great run. I look at it just like 2020. There were six months in 2020 when no transactions happened. Properties were still full, people will pay. I was at the lake four or five times a week, Lake Lewisville. Off you go.
Darin: I was going to ask you about that. I'm like, "What do you like to do for fun?" and you're like, "I'm planning trips." I've seen you on social media behind a boat cruising around. So talk about that.
Dante: I love being in the water, and I grew up by the beach in Salvador, Brazil. Being in Dallas and not having a beach, it's the only thing that I feel that's missing in Dallas. So I make up for it by going to Lake Louisville. I love wake surfing, wakeboarding or just being out there watching the sunset, and spending time with friends and colleagues. Also, I've had a lot of brokers out there with us and having a good time. I did that a lot.
Darin: Do you have a boat?
Dante: That's something that I enjoy doing. I have a boat. It’s a wake surf boat that I keep at Lake Lewisville, and easy to just get in, get on the water and it's a fun time. That's one of the things that I do for fun, especially during the summer. Winter, definitely skiing. I've become an avid skier and truly enjoy it since I didn't see snow.
Dante: First time I saw snow in my life, I was 20 years old.
Enjoying Life While Building Relationships
Dante: I was already living in Texas for two years. It doesn't snow here very often as you know.
Darin: You didn't go skiing here?
Darin: There are no ski slopes here.
Dante: Took me a while to learn. I've had some really good friends that took me under their wing and made me a better skier. Today, I can ski double black diamonds, like people that grew up skiing. That's something that I'm proud of and enjoy doing. Right now, looking for a house to be in for three weeks in Breckenridge this January. I know it's going to be at that time in our business, so might as well go enjoy life. Work on building relationships while having fun during that time.
Darin: My wife and I were just there with the RV. It was beautiful, like being in the '60s compared to being in the hundreds in Texas. If people want to reach out and get to know you better, what's the best way for them to do that?
Dante: Tourocompany.com is going to be our website. We have an option for contact there right now. My email address is email@example.com. Always open to talking to folks, networking to expand, and to people that are wanting to get into the industry to invest.
Darin: Thank you for sharing with everybody and for pouring into me when I just got into the industry four years ago. It's people like you that really give the whole industry a good name. It's amazing, people want to help each other. Listeners, this guy is somebody you should look up. If you're in the Dallas area, definitely look him up. Appreciate you listening. Until next week. Signing off.