Your KPI's and FIN

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  • Published on:  Friday, September 1, 2017
  • Episode 164

    I really love a lot of our guests and what they shared in the last couple of days here in the podcast’s episodes, especially Wayne Snell and Adam Adams back to back episodes. If you have not, check out their episodes in the library of the many, many great guests and discussions we’ve had not only here on the podcast but also if you’d like to check out some of the recordings, you can always go to to check out the first 149 episodes. Today’s topic falls into what Adam Adams and Wayne Snell discussed. I think a lot of people miss that underlying current of what is driving their business.

    Adam talked about how he loves to do notes, but he loves to be lazy. That’s a good thing. He has earned the right to be lazy in a good way. I don’t mean that in a derogatory way. In a good way, he likes to take naps. He likes to relax. He likes to travel. He’s working on bringing Jen home, his wife, from her full-time job even though she loves her job. He’s working on cashflow. Why cashflow? As he reiterated, he would rather have $200 a month coming off a deal versus getting a $10,000 check and going back to work. Wayne also reiterated that same fact he’s looking for cashflow. He’s looking for notes that are going to be reperforming that he can basically deduct that monthly payment from his overhead each month. The extra they have been saving aside and using that to buy and fund their own deals.

    Today’s topic, I want to go through KPIs, Key Performance Indicators and your FIN, your Financial Independence Number. A lot of people don’t start with the end in mind. As our good buddy, Aaron Young, from one of our previous episodes always likes to say, “Start with the end in mind.” As a real estate investor, what is your big goal? Is your big goal to fix and flip a thousand homes? Is your goal to modify thousand homes? Is your goal to have a thousand rentals? Probably, honestly not. My personal goal is I want to have 400 plus notes that are bringing in $250 to $500 a month in cashflow to me. That’s a great number for me. Everybody’s number is different. Wayne’s is different from Adam’s. Adam’s is different from mine. It’s totally different across the board.

    One of the things you have to keep in mind is if you’re really going to be successful, you’ve got to have a game plan. You’ve got to have a blueprint to your success. Wayne and Adam and Jay Tenenbaum and a whole variety of people out there; Cody Cox is on his way as well, Karen and Stacy Wall are doing a great job. We got to give a big shout out to Pari today. Pari closed on a deal, actually got cash out of the deal. A sixteen-month deal is going to make him about 16% return on his money. His own money funded the deal, 12,000 and some change, the borrower paid them off in a cash pay off. Sixteen months later, he made a 16% return on his money, which is great, especially in San Francisco where ROIs on investments are basically none out there because it’s so expensive.

    Keeping the end in mind and building a foundation, how many deals do you have to do to really retire if you want to or to hit financial independence? Financial independence means a variety of things for people. For me, it means you have enough cashflow coming in that if you want to take a month, two months, three months off, your bills are covered. Everything is running and maybe even growing a little bit. If you don’t work, you’ll have the money coming. That’s what’s called a business owner or investor, if you’re investing your money that way. Too many people are entrepreneurs or they end up the business runs them. They’re doing so much work to stay on top of things that they don’t get to have any fun. That’s not the way you want to be. You want to try with the end in mind.

    I think anybody who has ever run a company at some point has had the company run them for a while. Listen to Aaron Young’s Unshackled Owner podcast and you’ll see what he’s talking about. I love what I do. I enjoy it on a daily basis. I love getting up and coming to the office, hanging out with this crew here, making things happen. I love helping students out there across the world. I really, really do enjoy helping people, but I like making money. Let’s not call a zebra a leopard. I enjoy making money and my goal is to make money on what I do. If I wasn’t making money, I wouldn’t enjoy what I’m doing as much. I do love it. I do enjoy helping people but I got to cover my bills, too.

    What I want you to keep in mind this morning is your Financial Independence Number is going to be completely different from everybody else. How do you get to that number is one of the things that we’re going to do as far as backwards engineering today. On our virtual note buying workshop, we always start the workshop off with making $250,000 or six figures in the next twelve months. We’re going to do a little bit of spin on that.
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