Ruth Hiller is the accidental businesswoman who went from artist to real estate mogul in 15 minutes! Ruth's story is an amazing one that will show you how anyone can achieve success if they have the right mindset. She was able to capitalize on her skills and turn them into a thriving business by using growth mindset examples. If you're looking to achieve success in your own life, then learn from Ruth Hiller. She has been where you are and knows exactly what it takes to make it big. With the right tools and information, you can do anything you set your mind to. Listen and learn!
Table of Contents:
- Where To Listen To The Podcast
- Growth Mindset Examples: Expanding Into 16 Properties
- Going All In
- Mindset Shift and Investing in the Future Are Growth Mindset Examples
- Growth Mindset Examples: Showing Up and Speaking Up
- Growth Mindset examples: Know, Like, and Trust
- How to Reach Ruth Hiller
Growth Mindset Examples: Expanding Into 16 Properties
Darin: Ruth Hiller was an artist and a graphic designer. She attended a Tony Robbins event and within the first 15 minutes, she completely expanded her mindset. Since then, she has grown her real estate business into 16 properties.
So just a little bit on how we know each other. Ruth came into the same multifamily mentorship group as myself, the Brad Sumrok group. We were attending a Christmas party and she was so kind to be hanging out with me. Then we all had our food and she said, "You want me to save you a spot?" I was talking to somebody else and I said, "Yes, that'd be great." Then I couldn't find her. So she ended up having a great meal and I was wandering around with my plate in my hand. Since then, I've seen her do some fantastic things in the multifamily world. So I wanted to make sure we invited her on and to share. Ruth, appreciate you coming on.
Ruth: I'm so glad to be here.
Darin: So first question, how many properties and how many units are you invested in?
Ruth: I'm in 16 deals and over 2,800 units across seven states.
Darin: And you've only been in the group for how long?
Ruth: Three years. It's a pedal to the metal.
Darin: You've been busy. Share with the listeners what you did before the three years. What's your background?
Ruth: I call myself the accidental businesswoman because I've always bought and sold real estate. At age 29, I bought my first residential property in New York City that included a retail store. Then I bought single family homes along the way.
A Family-Owned Multifamily Business
Ruth: I owned a family-owned multifamily business. Aside from that real estate experience, I've been an artist and a graphic designer. So that's why I call myself the accidental businesswoman because how can an artist kill it in multifamily?
Darin: They really don't seem to go hand in hand. Being that artist, creative type graphic designer, I don't hear too many people that come from that background.
Ruth: But you know what that I discovered, I was giving a presentation last week and so I said, "I used to think it was a really big leap. But the thing that I noticed is that both art and graphic design and business both require problem-solving."
Darin: Yes, problem-solving is huge. I didn't really know that until I got into my first syndication deal. My partner was Raj Gupta. I don't know if you know him out of Chicago. He told me, "Darin, these large real estate transactions are all about problem-solving." I was surprised, but I have seen it play out. Talking to a lot of different people, I've definitely heard a lot of different issues. Let's talk about that. What kind of problems are you seeing in your deals? 16 deals, and how did you and your team go about solving them?
Ruth: Well, I'm a GP in four deals and an LP in whatever the math is, 12. Some of the ones that I'm the LP have great management. It's meeting the proforma and the budget, and then some aren't. The thing that I've noticed lately, especially I was listening to your last interview with Kathy Fettke about the rising interest rates and then the rising cap rates.
Growth Mindset Examples That Hit the Home Run
Ruth: Multifamily was a home run up until about last December. You could not manage it well and still make a ton of money. So the problems I'm seeing now maybe are a little bit with the bridge loans and the strike rates and all that. That's across the board. So there's been a lot of talk about our mentoring program and the coaching program.
If you underwrote for something and it's changing, how do you solve the problem of what is that going to look like next year? What are the cap rates going to look like, the interest rates going to look like? What's your mortgage going to look like?
Darin: What are people saying they're going to do proactively to manage that?
Ruth: On one of the deals that I'm GP, we bought the rate cap and so the insurance kicks in at a certain point. Then we have to take it out over the next two years and figure out that with the increasing rate, I think the rate goes up to five and 5.75. The banks kick in right on in year two. Then you have to plot it out if you're looking to solve it for the future so make sure that you have enough to pay your mortgage. The property itself is performing phenomenally, yet it's just been a little crazy ride with the interest rates.
Darin: Proformas, they're the best guess based on the best information you have at the time. Because I'm also an LP and a GP in a lot of deals, what I've noticed is that not all deals move in a straight line up.
A Drop in Occupancy
Darin: Sometimes you have some things that don't pan out exactly the way you want. But maybe there's some other factor that helps out. On one deal that I was involved with, we ended up having a lot more people leave the property once we took over ownership.
People warned me that that was going to happen. You're going to have a drop in occupancy right when you take over. I'm like, "No, we're going to be fine." Sure enough, it happened and I was a little panicked at first. Then I went to the property management company and said, "Here's the situation. We have all these unrented units, what are we going to do?"
They just brought maintenance people from other properties, turned those, and rehab those much quicker than we had in our plan. It was scary for a little bit, but then all of a sudden we were getting higher rents for a longer part of the year, once we put new tenants in there. So you could have good and bad happen. Interest rate is one factor, the other side of the factor is rental rates just keep going up, seems like.
Ruth: Do you think that's going to continue?
Darin: I don't know.
Ruth: My family owned a multifamily since 1968, which we just recently sold. It was in Los Angeles so it's a little bit different market, but the rents never went down since we owned it. Maybe they didn't climb as much as we wanted and the value never decreased. But I know we're at different times, so who knows?
Overcoming Inflation Is One of the Best Growth Mindset Examples
Darin: There are a lot of moving parts. Are we going to have inflation? Well, if there's a lot of wage inflation then people should be getting paid more. If people are paid more, then they should be able to afford higher rents. The flip side is some people are calling for deflation to happen like the fed is going to raise rates too much. All of a sudden, they're going to have to turn around and start dropping rates. Then all asset prices are going to be negatively impacted. I don't know. I wish I had that crystal ball.
Ruth: That's the thing too. We stay in touch with the brokers throughout our deal. Even after we've closed the deal, we talk to the brokers about what the market's looking like. What are the cap rates looking like? Did we underwrite the exit cap rate correctly? We're always in touch with those people to make sure we have the pulse of the market.
Darin: So you're in 16 deals. I've talked to some people who's like, "Inverted yield curve, I'm out." On the sidelines, I'm waiting for the correction and I'm not buying anymore. I have other people that are like, "I'm full speed ahead." Then people fall in between where they're continuing to buy, but not necessarily going all in. That's where I sit. I'm like, "Things can run a lot longer than normal. It could be another six months, another two years, or three years." I don't want to not continue to buy. But we are at a little bit of a risky point in both the real estate market.
Going All In
Darin: Obviously, the stock markets have already started to correct, but what do they do next? Who knows. So what's your take on that? Where do you sit?
Ruth: That's funny because I was just thinking about that the other day. I'm thinking I'm still all in, but unless there's an amazing deal before the end of the year, I probably won't. I'm still all in. I probably won't invest in a new deal or GP a new deal this year. Like I said unless something has a huge price reduction and it's an irresistible offer. I've been in the market for a joint venture, which would mean me and four other people would buy our own building.
Some of us were underwriting a deal recently and I guess the broker in the market was pretty green and he didn't know what he was doing. We've underwritten it six times and then he says, "Oh, the price is this." Then no, we can't do it at that price. So I would definitely go for a joint venture if I found another one this year. Maybe, instead of GP'ing, I’m investing in a known entity like one of the big guys that buy the $300, $500 million properties. I'd park some of my money there because I still need to place some money and I still need some depreciation this year. I have to take a little bit of action on that.
Darin: These are good problems to have. You're a member of the multifamily mentorship group. You're also part of Tony Robbin's platinum group. You said you were involved in mastermind groups as well. Why do you invest in these types of programs?
Some Weird Business Guru
Ruth: I'm going to say that five years ago I went to a Tony Robbins event, didn't know who he was. I thought he was some weird business guru. The first 15 minutes of that event transformed my life and my identity. I'm not kidding. I get chills still thinking about it. It changed the whole trajectory of my life.
Darin: What happened? What changed?
Ruth: I didn't know who he was. I wasn't doing great that year, so I wanted to make some changes in my life. So I asked a friend, it's a funny story, I said, "What do I do? I'm not doing well. I just don't know what I want to do." She's like, "Have you heard of Tony Robbins?" I'm like, "Isn't he that weird business guru?" "No, you need to go to this event called Date with Destiny." So I sign up for Date with Destiny. I go to the event. It's 5,000 people. I'm standing in the crowd scared like, "What did I get myself into?"
Tony comes out and he's like, "You're going to dance." I'm like, "I don't dance." He's like, "You're going to jump." I'm like, "I don't know, I don't jump." He's like, "You'll be here until 3:00 in the morning." I'm like, "I go to bed at 9:00." So at 3:00 in the morning I'm dancing and jumping." But he said something in the first 15 minutes I felt like he was speaking to me about biochemistry.
I didn't grow up in a positive environment, so I didn't consider myself a positive mindset person. My mindset shifted in the first 15 minutes of that seminar. I just became a different person.
Investing in Growth Mindset Examples
Ruth: Anyone that's met me post-Tony Robbins would never think that I might have been a more negative person.
Darin: I did meet you post Tony Robbins so I did not see that person before.
Ruth: I love Tony, so I continued. He had his platinum partners thing and I was like, "It's so expensive, but let me do it." Then everyone was saying, "The finance trip that Tony puts on will pay for your whole platinum year." I went to the finance trip and I was like, "Yes, no, I don't know how that works." Then, actually, it did. When I was sitting on the finance trip, Tony brought up these two brothers that were teaching about multifamily syndication.
I had never heard of it before. So I was like, "That's amazing. I need to sell this property in California and start doing syndications." But then I just let it go and didn't really know anything about it. Fast forward three months, I met Brad Sumrok on a bus in Malaysia. I'm like, "So what do you do?" He's like, "I teach people how to invest in multifamily." I'm like, "Can you help me?" The rest is history.
Darin: Was that on a Tony Robbins trip?
Ruth: It was a trip after the Tony Robbins trip. We'd done a Tony Robbins trip through Cambodia and then there were 15 of us who ended up on a side trip in Malaysia. Brad and Jen were two of the people. I sat next to them on the bus and we became friends.
A Big Change
Darin: In the first 15 minutes, you said you change your mindset and then the next thing you know you're on a bus sitting next to Brad. It was exactly what you were looking for. Now, you're how many deals? 16 deals and 2,800 doors later. That's a big change.
Ruth: I still pinch myself. It's like, "I can't believe it." The whole reason I got involved in Brad's group is that I had a multifamily property that I owned with family members. Let's just say we weren't in alignment. So I ended up at a rat race event. I met you that year and took 500 pages of notes because I wanted to improve the property that I owned with my family. That set me on this four-year journey. As I said, it took four years to sell that and we ended up selling it for almost triple what I thought it was worth.
Darin: I don't know how you were before, but you've obviously learned how to take action. There are some people listening who want to get into real estate. They want to start buying some real estate and investing, but they're scared. How do you coach people to take action even though they are scared?
Ruth: I always tell people to find a mentor or a program and study it at least for six months. Learn as much as you can and then be willing to take some action. What is the minimum amount that you could invest, and when do you want to invest that? I always tell people like there's that saying, "Buy real estate and wait. Don't wait to buy real estate."
Growth Mindset Examples: Being an Action Taker
Ruth: I'm really lucky I'm an action taker and I see people that aren't. I have a good friend that isn't and she keeps saying, "Yes, your next deal." The next deal comes and she's like, "Nah."
Darin: I know another guy that has done very well in multifamily. He tells me, "There are some people that I talked to 10 years ago that were like, 'We're at the top and he just kept buying and they still haven't bought." Some people may never get over that fence. But then, legitimately, there are other people that are just finding out about the syndication world. They're just trying to understand it.
For me, I had the capital but wiring the first LP deal I did was 75 grand. I was like, "Did I just wire this money to never, never land?" You're scared but then all of a sudden the next deal is easier and the next deal is even easier. Then you see the returns and you're like, "I wish I had done this sooner."
Ruth: I remember my first deal too. I was at Brad's event and it was actually Brad's deal.
Darin: So you felt kind of safe.
Ruth: The first rule is to know, like, and trust the sponsor team. I'm like, I know I can trust him. I've known him for about eight months and I've been studying with him. I did the deal that day and I was like, even though you're investing in yourself, it just felt like I was spending a lot of money. "Oh my God, I just spent all this." Then I had to correct my language and say, "I'm investing in myself and my future."
Mindset Shift and Investing in the Future Are Growth Mindset Examples
Ruth: The mindset shift. I think the people that don't take action, they're scared they're going to spend it or lose it, but you're investing in the future.
Darin: I think more lose it than spend it. People are just so afraid of losing anything that they don't look to the upside that they could have. That holds people back. I was going to say I love that terminology, an accidental businesswoman. But at the age of 29, you were already buying real estate. You're an action taker.
Ruth: I am an action taker. The thing I learned about myself through this five-year journey with Tony is that I'm a persistent m**f**.
I just don't give up, I just keep going. If it doesn't work, I go again and try something else. I didn't really know that about myself, but I've always been that way even before Tony. It became more apparent to me when I started really getting into figuring out who I am and designing who I want to be.
Darin: Whatever you call it, I call it thick skin. I tell my kids you got to have thick skin. The business isn't easy. I mean, it's not easy, but there are huge rewards. You do have to be able to take no’s and take rejection. How many deals do you have to go after to win a deal? You have a lot of people competing for every deal. Once you get a good deal, you're all excited and then you got to pitch it to all the investors. Some investors are like, "I'm on board."
Things to Learn About Sales
Darin: Your friend is like, "No, I'll wait until the next one." That's rejection too. But you have to be persistent. You have to keep going after it.
Ruth: I don't see that as rejection. The thing that I learned from Tony, it's funny because I used to hate sales. I don't consider myself a salesperson, but I actually am. The thing that I learned about sales, I would come back from a Tony Robbins event and I'd be like, "Oh my god." Everyone is like, "What is it? I want it." It's the same thing with multifamily. "Oh my god, this is amazing and I just post how excited I am."
It's been of a gradual build over the last year and a half educating people and getting people excited. There's a fine line when you're raising capital for a deal. It's like people are really excited. You're going to raise the money and then there's the fine line, "Yes, I'm offering you this opportunity. Let's get going now." It's interesting when you're raising capital on a deal.
Darin: Talk about where your focus is because in multifamily you could build a company, a syndication company. You can partner with other people. If you partner with other people, you could be focusing on one area or another area. Where's your focus?
Ruth: My focus is investor relations and raising capital. On the last deal I GP'd, I helped with all the new signage, the branding, some overseeing interiors, colors, and stuff like that. I'm the artist. I live in Colorado. So there have been a lot of great deals here.
Where the Market Goes
Ruth: There was one deal that I missed out on cause I didn't have a team assembled, but now I have a team that would be interested in doing a deal in Colorado. I've been more of a co-sponsor rather than a lead sponsor. We'll see where the market goes. That's something I would be interested in sourcing a deal here and working with some other people that I know from here that would be great asset managers. I'm not the asset manager. I understand it, I sit at the meetings.
Darin: So you don't want to do it?
Ruth: No. It's like a film producer. You have all the pieces. You're super detail-oriented. Even though I understand it's like I always say spreadsheets scared me to death until I started. I understand them and I can do them, but still being an asset manager, you got to just whip that stuff out.
Darin: The beauty is like you know what your strengths are. You focus on your strengths and then find other people to complement them so you don't have to do it all.
Ruth: In the beginning, I thought I had to do it all. I got deflated because I was like, "I got to find the deal. So I got to underwrite the deal. I got to put together the team." I've been on a couple of teams now. That's what I love about it too. I love contributing to the team and to the communities that we invest in. So to me, it's like a win-win.
Darin: Talk about that, getting your first deal as a GP, you can agree or disagree with me, but would love to get your take.
If You’re Going Large-Scale, You Need Growth Mindset Examples
Darin: In today's market if you're going after large-scale multifamily, you can't win a deal. It's very difficult to win a deal unless you partner with somebody that already has experience.
Then you also get all the pluses. Look, you talk to some people outside the group and they’re like, "I don't know if I want to do that. I'm giving up a piece of the deal." But I'm like, "0% of whatever is still zero." If you take a smaller piece of the deal and you partner with somebody that has the experience, then you learn along the way too.
Ruth: Yes, and it's interesting. In the last two deals, I did a deal in Tennessee and in Texas with two different teams. It's been a great learning experience to see how they both approach asset management a little differently or the budget meetings. That's been a great experience for me to see how everything works. As you said, it all sounds like, "It's so easy. You just go buy a building." Then you just run it. I'm like, "No."
I remember someone had asked me to come in on a team and be a capital raiser. So I sat in the meeting and they're like, "This is the deal." I said, "Well who's going to be the asset manager?" He said, "That doesn't matter." I was like, "What? I'm out."
Darin: There are two different styles, two different approaches for the two different teams. What did you see differently, what did you learn by seeing the two different styles?
Being on Different Teams
Ruth: One team is just not as regimented. The other team is just there. Everything is distributed ahead of time. This and that. Everyone knows what's going to happen. I feel like I've brought that back to the first one. We've gotten way more organized, just because I didn't know I'd never run a deal before. You have to get in there and see what's going on. It's a good experience to be on different teams.
Darin: You probably see it with all your LP deals. I ended up investing with a lot of different syndicators and I knew I wanted to be a lead syndicator. But I wanted to see the styles of different ones and then take what I liked from some. Leave out some of the things I don't like and form my own style.
There's that review from the LP side, but then when you partner with different teams on the GP side, it's the same thing. You see how people run the deal. I've been on the due diligence process where it's completely buttoned down and then another one where it's not. You could see the difference in any event. Why do you go to conferences?
Ruth: I go to conferences because I have a growth mindset. Tony Robbins talks about the six human needs and one of my top human needs is growth. That's always been a driver for me, that's why I'm persistent also.
I go to conferences to learn. Also, I'm a people person. I love being social, I love seeing what other people are doing. The thing I love about multifamily is the relationship building, whether it is with the team or with my investors.
Growth Mindset Examples: Showing Up and Speaking Up
Darin: People say that all the time like, "You're going for the networking, for the relationship building and it's a team sport, multifamily." But what does all that mean? Example for me, I was at a multifamily conference in the Carolinas and I was asked to be one of the speakers. I went to that and I had no agenda other than going to the conference, speak, see people that I've seen before. Next thing you know, I walk away and I'm partnering on a deal.
But that would never have happened had I not gone there. Even though we knew each other, it's like being in front of people all of a sudden gets them to think, "What are you looking for? What are you doing?" How can we work together? I don't know. People just don't all the time have you top of mind if you're not in front of them.
Ruth: As you do, you do your podcast, which is amazing adding value, teaching people, or information newsletters just to keep you in mind. This year was funny. I sponsored an event in town. It was too silent. I wanted to get in front of people so they know who I am. But, it's been a really fun event to just get to know people too.
Darin: Talk about that. What did you do?
Ruth: In our town, there's a program called The Month of Modern. Because I come from an art and design background. This is in Boulder. There's not a lot of multifamily in this community. It's a higher-end community I would say. So I just wanted to find a way because everyone knows me.
Growth Mindset Examples: Inspiring and Creating Change
Ruth: I've been here for 24 years and everyone knows me as an artist. I thought, "It'd be fun to sponsor it." The name of my company is YESMF. It's kind of cheeky. So I sponsored the event and I had to give a presentation called Pecha Kucha. It's 20 slides, 20 seconds per slide. The story had to be about inspiring and creating change. I'm like, "I've been on the path for five years. Tony Robbins and Brad Sumrok inspired me."
Then it comes down to I had to create change in myself. I gave this presentation and it was really funny actually. I've been meeting a lot more people in my community here because sometimes you want to get to know more people. Even though I've lived here for 24 years, I feel like I probably haven't been so involved in the community. So it's a way to give back and get to know people.
Darin: The other thing you said is that you've been there for a long time, but you are known as an artist. A real thing for a lot of people is, "Maybe they want to get into real estate investing. They want to get into syndication and bring more people to the fold, but they have this other career. They're known for being a different person and having a different identity. How do you go about making that change or adding onto it a new layer?
Ruth: It was interesting because, in 2019, I've been painting for about 30 years. I had felt really burnt out. It didn't feel fulfilling to me. I was trying to think why it didn't feel fulfilling to me. It didn't meet all my needs anymore.
Ruth: This is right around the time I had started personal mentoring. I don't know, just being willing to try something else. I've probably had six careers. It's funny because Tony Robbin says, "Either you stick with their career your whole life or every seven or so years you change up for something new."
I'm like, "I guess it was my time to change." I've been trained by Tony to embrace uncertainty and the unknown. So just try it and see what happens. I think a lot of people are scared because they're in their little box. It's not easy to step out of their comfort zone. Lately, I feel like I've been doing it a little too much. I want to relax a little bit.
Darin: If you're known as an artist and you come out and say, "I'm doing multifamily syndication." That's like a big change. They always say know, like, and trust. So if you're capital raising, you're presenting opportunities for people to grow their wealth. Before, you were selling paintings. You have to make a shift to build that trust with those people in a new way.
Ruth: It was interesting. When I joined the mastermind, I said, "I think I want to raise capital"." Brad told me, "If you want to raise capital, you have to nurture your database." You can't just go out there and say, "Now, I'm doing multifamily." I developed a brand and a newsletter, and I sent a newsletter out. It's been a year and a half now. Every two weeks, some educational thing about multifamily. Then I have a really high open rate. I get a 60% open rate because my emails are short and they're funny. People started calling me up, "What is this you're doing?"
Growth Mindset Examples: Shifting Your Identity
Ruth: I would post on all the deals I bought and what I'm learning. You have to be a little bit more in the public eye if you're going to shift your identity. Otherwise, you can't just wake up one day as an artist and the next day, "I'm the multifamily maven."
Darin: What you said about nurturing is important. You have your network. Then you're letting people know what you're doing way before. There's really a need to have them jump into an opportunity. I think there are a lot of people that have reached out to me. With social media and all this stuff, I don't think I want to tell people really or post anything until I get a deal or until a go full cycle. There's always this thing kicking the can down the road. But people want to learn. There are certain people in your network that are like, "I didn't know about this."
Ruth: Most people don't know about it. Not only have they never heard of multifamily, but they also don't know what syndication is. But I would say that I did that newsletter for eight or nine months before I ever had a deal. I just said, "Let’s just educate people." That's how I did it. I always taught through Tony, add more value. Instead of asking for something, you want to give something. Before Tony, I probably didn't do much of that.
Darin: You were painting. You're giving from your creativity and artistic brains. But it's a completely different world.
Ruth: It is, but it isn't. As I said, it's all about relationships and I think it's about how you feel about yourself.
Limiting Beliefs Are Not Growth Mindset Examples
Ruth: As an artist, it was hard. I couldn't sell my art very well, but I could sell multifamily, which is so odd to me because it's both sales. It's all about limiting beliefs. So I had more limiting beliefs as an artist than I do in multifamily. I feel like anything is possible. Why not?
Darin: In three years, you're in 16 deals. When you joined, you had no idea. This is what I also tell people. When you joined, you were thinking about your property that was in California, your family property. You were trying to figure out how to best manage that and sell it at the best price. Then the next step was growing Ruth's net worth. All of a sudden, it becomes bigger than that. It's like, "How can I educate other people?" That's what I try to tell people. "You think you're just doing it for yourself, but 2, 3, 4 years down the road, your network is coming to you, saying, "How'd you do it?"
Ruth: Which is cool. I would say most of my investors are women. It's funny, someone had suggested to me, "You should target women." I was like, "I don't want to target women." But then I found the women targeted me, in a good way. I was like, "As I got into the business, commercial real estate is 90% men."
I'm a female in a male-dominated field of commercial real estate. Why wouldn't I want to educate women on that? I think more women don't have the confidence to invest than men.
Darin: Why do you think that is?
Ruth: I think it's not taught.
Darin: But it's not taught to men or women though.
Ruth: I think just the traditional roles that we play. It's gotten better and there are a lot more women. People aren't taught about investing, but they're also not taught about financial literacy. Now they're starting to do that in school. My dad taught me how to balance my checkbook and how to keep books and stuff like that. That was the extent of my business training.
Then they said to save a little money but that was about it. There are so many good resources out there now like Robert Kiyosaki. There's a ton of books that you could read that can help you. That's what I like, to donate and help organizations that help women with financial literacy and mindset. Because you could be financial literate, but you're saying some people don't have the mindset to take action.
Darin: So you're educating women in your network. There are a lot of books out there, a lot of podcasts, blogs, and different resources both free and paid. But when you go to somebody that you know, like, and trust and they recommend a book or a podcast or a mentorship group, it means a lot more. I read a lot of books. A lot of the books I read are recommended by a guest on the show. They tell me about a book, I trust that person and I admire what they've done, and they're seeing value from it. So I decided to look into it.
Or I'm at a networking session. I'm with a bunch of real estate people and they're like, "Have you read this book on, whatever?" I remember the first one was Tom Wheelwright’s.
Growth Mindset Examples: Know, Like, and Trust
Darin: I forget the name of his first book, but they're like, "Have you read it?" I'm like, "No." I went and bought it the next day and I was like, "That had so much value." But it was because somebody that I knew had recommended it. I probably wouldn't have just found it on Amazon.
Ruth: That's the same thing. It's just recommendations. Some guy, I had a call with him and he said, "I've lost my shirt in multifamily." I said, "Really? Where are you meeting these people?" He's like, "On crowdfunding sites." I was like, "Do you know these people?" "No." So that's know, like, and trust the team. Number two has to have a great asset manager.
Darin: Yes. I've asked people, "Have you lost money on multifamily syndication?" I only had two people tell me that they've lost money on syndication. One of them said it was due to fraud. They actually didn't even have the property, they just raised the capital and ran with the money. Then the other person was on a crowdfunding platform. I'm sure there are good ones too. But that's one of the benefits I think of syndication over buying stocks. You can call the sponsor. You've got their cell number, their email. You can actually call and talk about the deal before and after you invest, where you don't get access to the C-level executives of Amazon.
Ruth: That's true. So, no, I haven't lost any money in syndication, but let me see, was it 24 years ago? I bought a 32-unit multifamily property in Denver, Colorado.
A Big Disaster
Ruth: So I lost my shirt on it because I didn't know how to do due diligence. I didn't know what I was doing. This was way before I did any education. I didn't know how to do lease audits and how to do due diligence. It was a big disaster.
Darin: How did you lose your shirt though? Did you just overpay?
Ruth: I overpaid. I didn't know enough about the neighborhood. So I did everything wrong. I just assumed you just buy an apartment building and you run it. That was 23 years ago. I bought this building. The realtor sold it to me and then I said, "I don't know how to run it." She's like, "We'll help you find someone." Then they couldn't help me find anyone. She was way out of her league, she was not a commercial broker. So she should have never sold me that property.
As you know, sometimes when you buy multifamily, they populate it with tenants just to get the rent roll up. But the tenants were drug addicts. I had to evict everyone, then the boiler went. This is 23 years ago. It was like $50,000 repair. I was like, "I just got rid of it because it was a money pit and I didn't know how to run it."
That's why it's important to have a mentor, find a group, and study with someone who's already done what you want to do. You don't need to reinvent the wheel. That's my biggest lesson. That is why I go with all these groups because if you're already successful at it, I want to talk to you. How did you do it? I don't want to read a book and figure it out on my own.
A $30+ Grand Mistake
Darin: I meet a lot of people that are in mentorship groups, but I also meet people that are looking to get into the space and they don't see the value in it. They're like, "I don't want to spend 30 grand." I'm like, "I get it. But if you make one mistake on a $10 million, $20 million deal, it could cost you way more than 30 grand. But if you're raising capital, then it's costing all your investors. If you lose your reputation, you could be one and done.
So knowing just the team members alone, who are the good property management companies? Who are the good rehab people, the good inspection people, and who should you bring on for due diligence? All those team members that you end up bringing alongside you that will provide you with advice and counsel. If you pick the wrong ones, it could be way more than a 30-grand mistake.
Ruth: I fully believe in pay-to-play. The first thing that taught me that was the Tony Robbins Platinum Partnership, which was quite expensive. But like I said, the information from the financial trip changed the trajectory of my life. It has probably paid for that 10 times over already just from what I've learned on the path I've been on. So it was worth every cent. I always say it is, but people are going to do what they do. Some people just want to do it on their own. That's okay.
Darin: I also think you have to have the right mindset and you have to be looking for how to get that value back.
Growth Mindset Examples: Multifamily Mentorship Groups
Darin: I see people sign up for multifamily mentorship groups and they write the check and they just think the deal is going to come to them. Well, it's not. If that's your expectation, then don't write the check. So it's a matter of learning from other people and getting connected to the network. But you still have to do work. You still have to grind it out.
Ruth: I was going to say you do. No, I'm just kidding.
Darin: Well, you know what? You're such a sweet person. I had no idea that you had this persistence in you that you talk about.
Ruth: That's my middle name.
Darin: You're always smiling. You're always happy-go-lucky every time I see you. So you think somebody like that, they don't have problems. You just have a good presence about you.
Ruth: I learned all that from Tony. I'm forever grateful to that man. The punchline of that story, remember I told you my friend sent me to his event? I came back and I was so happy, I changed my life and I took her to dinner. I'm like, "I got to thank you. This is thank you." She said, "This is really weird, but I've never done any of his work. I'm not sure why I recommended it to you, but I'm glad I did."
Darin: So that person didn't get any value out of it.
Ruth: She's never gone to any of it. She had a download to recommend it to me because she'd heard about it and I trusted her and I went. She's never, ever done any of his work. That's a pretty funny story.
Looking for the Value of Having Growth Mindset Examples
Darin: I've been to some conferences where maybe there are six or seven speakers. Four of the speakers I listened to, I'm like, "I didn't feel like I got any value out of that." All of a sudden one says something, I'm like, "I apply that to my world, to my business, that could be huge." I don't know that everybody is looking for that. Some people pay and they just want to be slapped in the head. You have to be actually looking for the value, I think.
Ruth: I think so too. There are a lot of people that join groups or whatever and then they don't take any action. As I said, you have to be persistent. All those goal-setting workshops that we all just love to do, you got to do them. If you don't know where you're going, how are you going to get there?
Darin: I don't want to put myself on this accountability, but I'm going to ask you. So I feel that way about Tony Robbins. I have not gone to any of his events, but I feel like I'm not the jump up and down, clap my hands until two or three in the morning type of guy. Then I have all these other people that come back and they're like, "That was so awesome, so amazing." So I loved when you said that you weren't that way and you were skeptical and then, the first 15 minutes, he converted you.
Ruth: He converted me and gave me tools to change my life in a way that I never had before and that you could actually implement.
The Cost of Not Taking Action
Ruth: My goal when I went to that event was, "If I could have one tool to just shift stuff." I came out with 10 toolboxes. But you have to be persistent. You have to implement those tools. Otherwise, it's like joining a group and not taking action. It's the same thing.
Darin: I had a guy on the podcast, maybe a month ago, Hemal Badiani. He’s somebody I met down in the conference in North Carolina. He shared with me that he went across the world to climb this mountain with people he didn't even know. When we stopped recording, I was asking him questions about it. I told him, "I really want to do this motocross thing. The off-road I've never done. I've owned street bikes but never off-road." He is like, "Just do it, man." I grab that accountability.
I'm like, "I'm nervous and scared." But in two weeks, I'm going now. I'm signed up. I don't know anybody that'll be there. We'll go on four days through Yosemite. It's like one of those things you said earlier. You find yourself having so many of these things that make you uncomfortable. And making yourself uncomfortable, it's scary but also exciting at the same time.
Ruth: It is. Tony says all the magic happens outside your comfort zone.
Darin: I'm looking forward to it. I love that you embrace so much of what you learned there. That's the power of Tony. I got to give him credit. I've never been to any of his events.
Ruth: One maybe will change that.
Darin: He's positively impacted many people's lives and I hear it in you for sure.
Ruth: I have met amazing friends through that group for sure.
Growth Mindset Examples That Build Your Network
Darin: How did you build your network? Passive investors are like, "I don't know who my network would be, how do I start it and how do I go about it." You said for eight months you were nurturing them before you actually had a deal. Who were the people that you put on the list and how'd you nurture them?
Ruth: I had about 500 people in my database from Tony Robbins, people I met, and friends that I had. As I said, I came up with a brand name, and then I just started putting out educational emails like what is this syndication? Then texting people that I hadn't talked to.
Jesse Itzler says that you should text at least three people a day and say, "Thinking of you. How are you doing?" No need to respond. Just to let people know that you're interested. That’s the biggest thing I got from Tony, just being interested. The more interested I am instead of me, me, me, the bigger my network is.
Darin: That goes to mindset because some people think, "I'm going to be bothering people if I send this email to my network." But if you had 500 people, maybe there were 200 people that were not interested. Maybe there were two or 300 people that were like, "What is this syndication thing?" It's the first time they've heard it. Or maybe it's 50 people. Who cares?
It's like you're doing it for the people that they don't know and you're trying to educate them. If you're not doing it and nobody else is doing it then how do they even get educated? That's what I'm trying to get into people.
Why Tell People What You Do?
Darin: Other people start telling your network what you're doing, even if you don't know how to them.
Ruth: I tell everybody. They're like, "So what do you do?" I said, "I teach people how to double their money in two years and not pay taxes." Maybe we're not doubling it.
Darin: That gets people interested for sure.
Ruth: Then I tell them my company name, YESMF. And then, should you buy multifamily? "Yes, m**f** you should". I judge if they say, "That's cute," then I don't go on. "Tell me about it." You can judge if someone wants to know. I'm excited about it. I love it. So I just tell everybody I know. If they don't want to talk about it, we could talk about something else. If it's your passion, you want to tell people about it.
Darin: So where do you go from here? What's your next big stretch goal?
Ruth: My next big stretch goal is to be a lead sponsor. Not this year, it'll be next year. This year, I don't know about the market and stuff. Unless something amazing came, I'm open to it. I'm not going to say never. But that's my big goal for next year. This year was to GP two, or three deals, which I did. It's like two or three deals a year depending on the market and the team. What I'd really like is there are a couple of teams I've worked with. I'd like to continue to work with those on a regular basis.
Darin: That's cool. So lead sponsor 2023, you heard it right here. We're going to see it happen, I'm sure because she's an action taker.
Seeing Things Happen
Darin: That inspires other people. You're getting other people involved at the LP side. Eventually, they're going to say, "How do you do what you do?" Then you teach them. If people want to get to know you, what's the best way for them to reach you?
Ruth: They can go to my website at yesmfnow.com. I have some free info and educational articles there like how syndication works and why I like stocks versus real estate. There are about 12 or 13 different articles. I post my newsletters there too.
Darin: What do you like to do for fun outside of work besides painting because you are an artist?
Ruth: I love to be in the mountains. I have a place up in Vail, I was there last weekend. There's this 10-mile drive up on this little teeny dirt road. It takes an hour because it's a really bad road. It's the most beautiful place I've ever been. To be out in nature would be my favorite thing.
Darin: I love Colorado. You live in a very special place, but I had to say I was driving a big old RV through Colorado, windy mountain roads is stressful. You have cars that live there that are just whizzing by you. I got to grit and bear it and can only go as fast as I can go.
Ruth, I really appreciate you coming to the show. There are so many people who think it's out of their realm, that they can't get involved. I love that you're as persistent as you are, that you're building the network, and that you're always a pleasure to be around. Listeners, until next week, signing off.