Running multiple family-owned businesses sounds like a complete cakewalk, right? The truth is, it’s not as easy as you think. You may know the people you’re working with, but you have to set boundaries. Learn how you can balance business and personal life with Jamie Bateman and his guests, working couple Tracy Z and Fred Rewey. Tracy is a Note Investor and Owner at Exposure One & Diversified Investment Services. Fred is the Co-Founder of Exposure One and Owner of Diversified Investment Services. He is also the author of Be The Lime: The World has Enough Lemons. Join them as they share what it’s like to work together as a team in the notes space. Discover their multiple small businesses and how they outsource their work. Also, know more about Cash Flow Expo and the Wise Women Investors Expo. Learn how to run a family-owned business in the note industry today!

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Listen to the podcast here:

Running Multiple Family-Owned Businesses In The Note Industry With Fred Rewey & Tracy Z

I’m joined by Tracy Z and Fred Rewey. I know you have multiple businesses, NoteInvestor.com and Cashflow Expo, etc. We’ll get into all that. I want to thank you both for joining me.

Thanks for having us.

Thank you. We appreciate it. We appreciated your presentation at Cashflow Expo. We liked the show and your Facebook group. Thanks for having us be part of this.

I know Chris and I have been talking on and off about trying to get you on. We finally made it happen so I’m excited. We talked that we’d focus a little more on small business and working together as a couple versus note investing. I know we’ll hit on notes a good bit as well. Before we jump into that if you two could touch on your background a little bit for those audiences who are unfamiliar with you, that would be great.

I started in notes in 1988. I went to work for a large institutional investor. I had a background in real estate closings. They bought real estate notes, seller finance notes. My mind was open to this whole other arena. I worked for them for ten years, moved into an underwriting and vice-president role. After doing that for them, it was a great education for ten years in the note investing space. That was in ‘88 to ‘97. I met this guy next to me. The note business introduced us. I’ll let him tell his background because he came from a different perspective.

In 1997, we got married. We started our own company. We left that institutional investor because we wanted to build our own business. From 1997 until now, we have been buying and selling, mostly seller finance notes. We like the performing first-lien space but we did have some experience in non-performing as well. We, along the way, have taught other people. We’ve developed some online expos but I’ll leave the rest of that for Fred to provide input on.

She’s about 4 or 5 years ahead of me in this industry. It was the early ‘90s. I was taking some courses at a nearby college on real estate. I was trying to take some night classes on real estate because I’m trying to figure out how to buy property. During that time, there was one week, the instructor who was a good friend of mine, John Richards, was one of the original ones that made it very public to a lot of people. One week he taught me the calculator and I thought it was the coolest thing ever. I’m like, “I hate Math but I love money.” It all clicked for me.

He taught me the note industry in about a week then one thing led to another. I followed him around a little bit and he taught me a lot about it. I ended up in Washington, where I met Tracy but I started my business at a 500 square foot apartment, buying notes and declaring myself in business. I went out and got a computer, which at the time cost me like $5,000 or something stupid. I had a fax machine that had the thermal paper on it so the roll would fall off the back. I learned you couldn’t have the thermal paper fax next to the stove because it was a small apartment and that turned the whole world black.

We left in ‘97, as Tracy said. She was a full VP. I was assistant VP of a company and we loved it. It was a six-figure corporate job for both of us. Golden handcuffs with bonuses and everything else but we couldn’t buy notes for ourselves because it was a conflict of interest of working for a company that did. We walked from all of it and built that business on the note buying. 2008 hit and we all reinvented ourselves a little bit as far as that was going.

We started trying to move into buying notes and also giving back. We started creating training and stuff like that for people to be able to learn our way. We built our business since then with the goal of mine in being able to travel. We don’t regret leaving the corporate environment. We’ve gone to other countries for six months at a time. As long as we have internet access, we still have a business. That was important.

There’s so much I can personally relate to that you’re talking about. You’ve been in the note space much longer. I got out of college did some coaching. I wasn’t sure what I was doing, to be honest. I then worked for a title company for a couple of years. I did closings and refis. I learned right away how little I knew about real estate and notes, mortgages, title, insurance and anything like that so much that you don’t know that you’re not taught in school. I also have worked with my wife with different businesses over the years then quit my job but I think mine was a little more gradual. There are so many rabbit holes we could go down. What was the mindset like when you did leave your golden handcuffs as you refer to them?

I had started brokering notes before I joined the investor side. I had a pretty good knowledge of that but our job at the institution was to work with brokers and to offer them incentives to get more business. We would have anywhere from $12 million up to $20 million on a big month. We were dealing with the best of the best out there. We knew how they all operated their businesses. I had done it from my kitchen table, not for their scale.

I had worked with one of the biggest ones in the industry at one point. We felt pretty comfortable going in and doing that. We tried to do it in stages. Tracy left first then I was going to be a little bit farther behind but then at some point, it got to be a little bit awkward for everybody. Not us but it got awkward for other people so I finally left.

We knew pretty much what to do. What we tell people now is, “Don’t quit your job until you’re able to do it.” I think the big thing in the beginning into a little bit of the small business thing is that people have a tendency to spend money on things that I say, “Buy that later on profits. You don’t have to do that now.” People get obsessed with the oddest things. What I love about this industry particularly from a, “Do you want to go and do it?” We’re not forging new ground here. This has been done for decades.

People that go, “I got to figure out how to do this.” Someone’s already done it. The marketing’s already been done. Could you come up with a better letter or postcard? Yeah. Could you come up with better networking for your website? Sure but the whole process of what we’re doing is nothing new. That’s a good thing.

I come out a little different. I am very security-minded and that probably comes from a background of not having a lot. He knows. It was harder for me. It was much harder for me because I do come from a background. I didn’t have a lot and I worked hard to build something and have the security. Not the money for the money’s sake or the prestige but the security. Moving to not knowing where confidently where your next paycheck was coming from was a big stretch for me.

I’m glad I made it because of the freedom that comes along with it with time and intention and the ability to spend time with my daughter when she gets home from school. All those things were fantastic but that was a mind shift for me and moving from a scarcity mentality to an abundance mentality. That’s another thing we can unpack but that all was a little bit harder for me probably than for Fred.

That makes a lot of sense. I agree with people, generally speaking. Everyone’s situation is different. I don’t recommend people quit their day job without a plan. You had hands-on experience and were really successful. You knew what you were doing so you had confidence.

We’ve saved up some money.

People are motivated by stress in different ways. Some people, when there’s that stress to go out and succeed, will. I think most people are not. It’s not an assessment of someone’s personal beliefs or values or anything like that. It’s that you can’t sometimes always make the right decisions when you’ve got the pressure of, “I got to pay my mortgage or I got a kid.” You got to create that buffer, whatever it is for you.

Don't quit your job to look for another one until you're able to really do it. Click To Tweet

We were relatively younger so we had a chance to do it. Plus, we probably could have if it didn’t work. There were numerous other note buying companies that we could have walked in the door and they would have been happy with it. It wasn’t like we didn’t have a backup plan and we had saved up money but we left during the prime buying of all of it. I had the relationship so it worked out well.

It worked out because fast forward to 2022 and we used to have longevity in the business. It’s a good business.

If you would speak to what your business looks like now, I know you have multiple branches of it. What does your week look like? What do you spend your time on business-wise?

We do still buy and sell real estate notes. We do no longer use credit lines. We were big on credit lines and building portfolios for a while. Now, we put most of the ones we buy into a self-directed retirement account and we’ll still refer some to other investors. A portion of our time is looking at notes and marketing for notes. We also do online expos. I’ll let Fred talk a little bit about Cashflow Expo and Wize Women Investors Expo. It’s an opportunity to share more knowledge with people about cashflow, investing and alternative investing.

We also do coaching for members. I know you do as well. We set aside a certain amount of time to do one-on-one calls and also group coaching calls. We’re the second set of eyes. We can’t give financial or legal advice but we can’t give you a second set of eyes on a deal with like, “This might be a good investor or here’s what I’d look out for if I was going to hold that note myself and invest my own money.” That’s what our day looks like for the most part. Also, our daughter has joined us, which is cool. She handles a lot of the social media website design that our company does for people who know the business as well but that’s more her day.

Does she have a self-directed IRA?

She does. She does have an IRA. She likes the stocks now but she’s saving up to get enough to buy a note.

I have a fourteen-year-old daughter so that’s why I was asking.

I have a funny story. It was about family in the business but we’ll circle up on that. You go ahead about the expos and your day.

There was a shift in our business that was interesting. Everybody talks about this whole giving back thing and I got to tell you, 90% of the people that I hear talking about that I’m like, “Whatever. It’s your shtick. I got it.” I was working in a restaurant 60 hours a week. What I learned on the note industry and what that gave me going forward and the flexibility, I love the industry because to me, I don’t know another financial aspect where everybody wins. The note seller doesn’t have to sell their note. They get to liquidate a note and get cash. The broker, if there’s a broker referral source in there, they get a fee for it.

The investor gets to take money that’s sitting in the bank earning nothing and get a better return on it. I don’t know another industry that’s that good. We did not, for years, have any training or anything like that because we weren’t. We didn’t do it. It takes a lot of time. I will say that our membership and stuff take a lot of time. It’s not free. We only open up the doors twice a year. We’ve limited it because we don’t outsource it. It’s us. We don’t have a help desk. We don’t hire people. Flashing forward, we’re always coming up with too many ideas. The idea hit me a couple of years ago on a couple of things. One was the Best of Notes, which you were nominated on the show, which was awesome.

Congratulations.

Which came from the idea of, years ago, I was in Coeur d’Alene, Idaho and they were doing the “Best of” in the newspaper. I saw the headline, Who Has The Best Cheeseburger? I’m like, “I want to know who has the best cheeseburger.” I realized I’m like, “How has nobody done this in the note world? The best of the best,” so we did it. It’s been great. A lot of people share that and show it.

That’s been fun and cool to track.

I saw somebody years ago do what ended up being Cashflow Expo for me but he did one on Airbnb in England. He had all these different speakers talking about how they do their Airbnbs. There was no cost to attend. They could buy tickets if they wanted which gave them lifetime access to the recordings. I thought that was a neat model. I thought, could we find other speakers in our industry that we’re willing to give their time and do this event and make it completely free for everybody? Now, we broadened it a little bit. It wasn’t only notes. A lot of its real estate. We have crypto some factoring and things like that.

We included some great speakers. The only rules we had on that were, I didn’t want it to be a pitch fest. I didn’t want people for $10,000 join us type thing. It had to be solid information and people could put forth information to how to get ahold of you later and things like that. That blew up. From the first year, I had no idea if it would even work. We finished our fourth one and we had over 3,000 registered attendees. There are over 6,000 in the database as far as that but great attendance, great speakers and a great lineup. It’s three days long.

How was it for you?

I appreciate you inviting me to be a part of it. It was good. It was great. I’ve got a chance to watch a lot of the other presentations as well. I know in 2021 it was good as well. I know the last few years, I’ve watched a lot of the content and it’s been good. Not that anybody saw the pandemic coming but you timed it pretty well from that perspective.

We were online before it was cool.

People wonder how you pull that off because yes, there is a small fee if you want to keep the content or the access to it. You touched on adding value and that’s all it is. There’s some bit of marketing and exposure that happens for the content creators if you will but I think people expect that. It’s been a phenomenal success. I don’t know what it looks like behind the scenes but it’s been good. I like the fact that you touched on it and it’s not only notes. Notes are awesome. That’s 90% of my own professional focus if you will but there are other cashflow and other asset classes. I’m curious about that. Is the goal to expand that going forward?

You can't always make the right decisions when you've got a lot of pressure. You got to create that buffer for what works for you. Click To Tweet

It’s always been the goal to be more diverse. That was always the goal. It was challenging, in the beginning, to find and vet speakers and now we have a pool. The other event we do is Wize Women Investors. It’s a mirror of the expo. It’s the same idea. It’s only fewer days but that’s only women speakers, which gave us an opportunity to focus on women’s speakers, which was Tracy’s thing. That came about partially. We would go to these predominantly note conventions or other conventions and it was like all men. Women are in the industry or haven’t been in the industry for a long time.

I know that to be different because I know lots of women that are in the industry only maybe not up on the stage. I thought it would be a nice opportunity for women to see other women in the industry and speak about different kinds of investing because when you see other people doing it, you go, “I can do too.” You gain a little bit of confidence. That’s another avenue. We’ll have our third year of Wize Women Investors. We’re a year behind.

I want to touch on one thing about that to people reading necessarily. All the data shows that the fastest-growing group of investors and manage their own money is women. They also manage the household money more than the men do. They also dictate where that money goes. To do these events and make it an old boy’s network of things like that, I think is a missed opportunity. To your point back on Cashflow Expo, I felt good about the mix. Is it heavier real estate? Absolutely but right now, real estate is hot so it’s hard to avoid that. We got crypto and factoring in a bunch of other things in there as well.

I know Chris and I have reviewed our top five episodes from 2021, as far as the show goes. I think 4 out of the 5 had women on it. I’m glad that the public seems to be in support of that. That’s cool for both of your events there. As far as working together as a family now, I know from personal experience that it can be challenging. My wife and I did. It’s only us, I guess.

My wife and I have a rental portfolio. We did rehabs together and grew that portfolio in Maryland. She also technically was my only employee for Labrador Lending for a while there until the pandemic hit. She had to transition to being a stay-at-home teacher but it’s not easy. Running a small business by yourself is not easy. I’m curious if you could speak to some of the challenges. How you’ve addressed those? It doesn’t have to be too personal but how do you separate your personal life from your business? How does that work? Give us a peek behind the curtain.

There are two things and it depends on the makeup of the personalities. The two takeaways I have run out of the gate, I would say is that, particularly when you’re dealing with two very dynamic personalities, what’s the most important we learned early on was putting up a closet organizer. We both can’t take the lead on a project. We have to have very separate responsibilities. Any couple’s problems become challenging when we overlap. We try to have, “This is your job. This is my job.” If it’s something we’re both going to have to do simultaneously, we basically say, “This is your baby.”

I’m going to take a step back and I’m going to do what you tell me to do on this project because you get into tension on that unnecessarily. The couple thing can be strong but it can also be a problem. If you come up with something and you give it to the other person. It’s like a kid. It’s like, “Look what I made.” Any bit of criticism, which is legit criticism, you take it wrong. You take it personally. You have to frame that going into it.

The big thing is separate responsibilities whenever possible. When you have that overlap recognize where you’re coming from. The other thing for me is that we have separate offices. I don’t think you can work in the same office but one thing I had to realize early on was we have different techniques of doing something. This is very much when we were on the phone a lot with note sellers.

I would listen to her on the phone and I’m like, “I would never say that.” I have a lot more experience of phone time with sellers. She had more experience on the investor side at that point. I’m like, “Why did you say that?” She would have the same with me. You have to realize that you have different styles and be confident in knowing that person is going to get to the finish line. It’s not the way you would do it at all. For me, those were the two big things. What about you?

I was going to say don’t work in the same office. We learned that. We thought we could.

That whole dynamic in general comes with so many challenges. It’s very nuanced. It’s very specific to the personalities and what type of business you’re running and that thing. I’m generally the one pushing things forward. The thing is, with my wife and me, there’s no actual deadline. She’ll ignore what I say and I get it right. If it were someone else who she’s not related to, she’s maybe a little quicker to get things done but we had the same struggles where it’s like, “That’s not how I would do it,” but it was probably a good thing. There’s not only one way to skin the cat. That’s one thing I love about notes and real estate. There’s not only one way to do things.

You have to take the personal aspect. You have to put aside personal feelings and realize you have to be in work mode. That’s the same thing at the end of the day. We have a stupid amount of output. I look at what we do and it’s stupid. You have to get to the end of the day and go, “We’re done talking about work,” because we also like what we do, which means it can blend into other conversations and that’s a problem so you have to shut that off. It’s the same thing in the morning. If somebody is up before the other person, until I finish my cup of coffee, my first cup, we’re not launching into any work stuff. That’s the rule.

We’ll do that to each other. Somebody starts in the conversation, we’ll look down at our coffee and we’ll show cup. This did not happen immediately. It took time to develop. You have to have permission. You have to say when you’re not in the heat of the moment, “I need this and what can I say that doesn’t escalate something like the bottom of the cup of coffee or it’s after 5:00,” or something that you can say, “My brain is full.”

For me, I also like incorporating language like from The ONE Thing, which is a great book. I can say, “This is not my one thing now because I’m also a little bit of a pleaser,” so I want to do everything for everybody. I want to make their life easier and so I have to honor what I can realistically get done. We have to agree together. One of the most important things and that if it’s not on that list, it’s okay to say no instead of deciding in a kind and gentle way.

I also think the expectations. We used to do this when we had the corporate environment. I don’t know if we inherently do it now that we’re not part of that. We would go into each other’s office in the corporate environment and go, “I’m not looking for you to do anything. I only want to vent.” Especially as a couple, you want to fix it. To the other person, if they’re not wanting you to fix it, that’s frustrating. You try to set up that parameter of look, “I don’t want you to do anything. It’s a data dump. I’m venting about something.” You have these different hats and like, “Am I the couple hat? Am I the business partner hat?”

Am I the underwriter?

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My wife and I, it’s the same. I want to fix everything. Generally, I want someone to help me fix it if there’s a problem. My wife and I want different things when we’re venting typically but we only started instituting something where I said, “I’m only going to listen for ten minutes. The only thing I can interject is repeating back to you what you’re saying,” which is way more challenging than it sounds like for me. Speaking of the multiple hats, even without the couple dynamic, that can be challenging with the work from home thing going on much more now because of the pandemic.

If you do have multiple businesses like Chris and I have BIFI Loan Servicing now. There are times when it’s like, “Shante, I’m wearing my lender hat. I’m wearing my owner hat now.” Given the nature of the world we live in now, that’s even more important to define what role you’re playing because the boundaries aren’t quite as clear as they were when it was one person works a 9:00 to 5:00 and they come home. It’s a work in progress. You’re never there but you have done a good job of navigating those challenges.

I say going to say, you’re pointing at the hats now because of the speed at which everything happens. You have the different hats and that’s where like the book The ONE Thing and stuff like that starts to help as far as, “What am I going to focus my efforts on? What action is truly going to move the needle? I get sucked up into busy work but not productive work.” We’re going through a thing now on the marketing company side where we’re having to go, “There are certain clients or certain things that we can’t do everything.” You have to go, “What do I have to let go because it’s too much or too busy or outsource.” You’re constantly looking at that but we keep in touch as far as what we’re working on and what the highest priority is. I sent her an idea that I thought was spectacular. She’s like, “I don’t have time for this. I don’t want to handle this now.”

I didn’t say it like that.

She said, “No, my plate’s full enough.” I’m like, “Let’s revisit this in 2035 or whatever.”

It’s true. It could be a genius idea but there are also the opportunity costs of what Tracy’s not worked on.

There’s an analogy I heard a long time ago. It talks about teamwork and helping the other person. It equated to being most people think of, “I’m going to come over and help you.” The analogy they used was like baseball. If I’m on first base and you’re on second base, the very most important part of the teamwork is for me to cover my base before I ever helped you. A lot of us on teamwork, we think teamwork, “I’m jumping up and helping you but then I’ve left my entire side position, in this case, unattended.” It’s learning to say no to certain things but the whole teamwork thing is you got to hold down your side. It’s probably more important than jumping over and helping the other person because they already got something to worry about. They don’t need to worry about your crap too.

That’s good. I like that. You mentioned your daughter. Do all three of you work with the marketing company?

We do. The marketing company came about in 2004 or somewhere in there. It came out of necessity. We are outsourcing a lot of note-related stuff, websites and email campaigns and things like that. We decided, “It’s expensive. Let’s learn it.” I’ve always loved marketing and that side of it so we said, “Let’s take it over ourselves.” That turned into its own entity. I love email marketing and funnels. We’ve got big clients. We do that for social media and things like that. We are able to turn some of it into the note business but a lot is outside the note business.

Our daughter, when she first saw us all working and she was like, “I’m never going to be in that business.” She went to school. She got two degrees. She was into the outdoors. She did a lot of whitewater rafting, guiding and all these different things. She then started to realize that those industries don’t pay as well. She still like freedom and then she got interested in our business. I’m super happy. She worked for marketing companies in the outdoor industry and other things. She had all that experience and now she works with us.

Now, she’s getting very interested in the investing side of the notes. This is nothing we’ve ever pushed on her. It has to be something they want to do. We’re pretty excited, pretty giddy that she gets to work with us. It’s the same thing working with your kid. You’ve got to realize what hat you’re wearing at that moment. They have their own things of, “Are you talking as a parent? Are you talking like a boss?” That would be an interesting conversation to have from her perspective as well but we’ve always said to ourselves, “We’re your parents first. I’m your mom first.” That comes first and like with Fred, I’m his spouse. I’m his life partner first then I’m his business partner.

If I have to choose between what’s the best reaction at that moment. I remind myself that. That has served us well so far. I don’t recommend it for everyone but for us, it’s worked out. We like each other. We love each other. It’s fun to get to work with people. The good side of working with people that are related to, you know they got your back. You don’t have to worry about that.

This is in the weeds a little bit but what do you do for health insurance? It’s something I don’t hear people talk about enough. People who are self-employed.

We have high deductible plans and we use an HSA. We’ve set that up for everybody. We’ve tried to look at trying to get a corporate plan. It hasn’t worked for us. We do the high deductible plans with an HSA. HSAs can be self-directed and you can put those into notes if you want or into the stock market. There are some opportunities there as well, the health savings account. All of the self-directed IRA companies offer them like Quest and NuView, Cama and Equity Trust.

I feel like the self-directed thing has grown in some, as far as exposure or the knowledge base, if you will, in the last few years. Maybe because I’m more aware of it now but I feel like it’s still very much unknown. Do you all participate in that personally as far as self-directed accounts?

Yeah. I think it’s not only unknown. There are the people that don’t even know about it then there are the people that know about it. There are the people that know about it and putting money into the account and I can’t remember what they said. Their money sitting there is uninvested but it was a huge number of money sitting there that people don’t take any action with.

Doing business as a couple only becomes challenging when both parties overlap. You need to separate responsibilities. Click To Tweet

I think it was because we had the Quest guy on. It was a massive amount of money.

I want to say like $400 million. I don’t know. We got to look it up.

It was a big number.

It was a shocking number.

It’s a fantastic way to go for note investors in particular because there are no real inherent tax benefits to notes. Every asset class has pros and cons. You’ve highlighted some of the pros of note investing. One is you can travel. You can be a known investor from anywhere. That’s something the gurus talk about that is accurate. As far as taxes go, it’s ordinary income typically speaking if you’re buying, selling and collecting that interest. Why not use a self-directed account and solve that problem? That’s something that I think the word needs to continue to get out there. I love that you guys strike me as people who are trying to add value and you do what you say you’re going to do. You’re genuine and authentic. That goes a long way in the. In this world, especially. It’s fantastic.

Thank you.

We appreciate that. We try to be no-nonsense, even like our training and stuff like that. I’m not going to sell anybody in our training. Either it’s right for you or it’s not. I think it’s the way you do business.

I think that was the only thing somebody said about me and my whole life. I went to my grave, that would make me feel good so thank you. That’s important to us.

Playback that snippet. I like to think of myself in the same way so that was a genuine comment on my part. You mentioned The ONE Thing. Are there any other books that you refer back to or that you liked over the years?

I like Atomic Habits also by James Clear. Do you like that one too?

I like his weekly. It’s a short newsletter he puts out as well.

I was going to say Who Not How.

He was on in 2021.

Yes. Anytime you can do the subject of who to hire and not how to do it and have that guy write your book for you. If that’s not a genius illustration of it, I don’t know what is. The idea of is it better to have somebody else do it? We didn’t touch on that but that’s a challenge on being a small business that we run into. Anybody driven runs into is the ability to outsource things because no one’s ever going to do it as good as you. No one’s ever going to make it as fast or as pretty or whatever. You have to realize. We went through a phase that started years ago, strictly on the marketing company side. I would say to my mind and Tracy had to learn this quite a bit, also was is it good enough? You’ll never have it 100%.

Even when I wrote an email out to the group and it was like, “Is this going to stop the action from happening? Is this is going to stop them from going and checking out Cashflow Expo? Is this going to stop them from wanting to learn more about notes?” If it’s not then move on. The Who Not How opened up my eyes. To get to the next level stuff is, you have to outsource more stuff. You have to. You can’t do it all. We already do too much.

I like all three of those books, the Who Not How. I think it was because of your Cashflow Expo is why I bought that book. It’s the absolute almost mic drop example of how to do it.

It couldn’t be any better. Only if he had someone come to do his presentation at Cashflow Expo. I’ll present and some other guy shows up. I’m like, “I’m here to present. Yes, I am.”

The outsourcing topic is interesting too because we’re going to be down at DME then IMN but you guys are in Florida as well.

I’ll be there. Fred has some other commitments.

I’ll be at the second one. I’m flying back in time to go to that.

To get to the next level, you have to outsource. You have to know that you can't do it all. Click To Tweet

One of the panels I’m on is about outsourcing. I don’t think it’s a clear-cut answer as far as, as you grow, you should outsource or as you grow, you should bring things in-house. It’s tough. Every small business owner needs to figure that out for themselves and it depends on what task we’re talking about. Chris is good at outsourcing, systematizing and bringing someone in for a project then that’s it. Not hiring in-house whereas I tend to favor more trying to train someone long-term, bring them on and build a team thing. We work very differently but both can be successful ways of approaching it. Back to what I love about small business, real estate and notes, you got to figure out what works for you. There are principles and tenets that we’re talking about that work across the board but your small business is probably going to look very different than mine and that’s okay.

I was going to say the one foundation thing when you start talking about outsourcing but not, that everybody shares are you look at the time first, not money. Look at where what’s taking you the most time. Don’t even talk about what is a cost outsource or what income’s coming in. What’s taking you the most time because that’s probably the biggest thing that’s identifiable. The other thing that I think versus in-house versus not that you’re talking about is that we want in-house. It all sounds good but we find that in our business, particularly with multiple businesses, we have so many different skill sets that we need someone to do.

It’s like, “I don’t know who that person is.” That person’s not going to walk through my door that can do this and this and can I train them? When she says, “We need to outsource this or we need to hire somebody for this.” It’s like, “I don’t even know where to start to tell them what to do. I can’t even make that list.” I’m busy doing it now and I know that’s not right.

We do struggle with that. That’s on our list. We need to reread the book again.

You’re only being real. You’re always working on putting together SOPs. We’re using Loom more now for how to do things and that sounds good but I have to get stuff done now. It’s easy to talk about and harder to do it.

It’s like the expo. I can outsource the expo as hard. I can still get the speakers and have someone do all this building and someone else manage the sponsors and all that other stuff but between the three of us, we do it because I don’t even know where I would start to do all the SOPs and what it takes. That’s a beast behind the scenes as far as coordinating but it’s only once a year.

Speaking of the expo, can the audience still access that content?

They can. It’s closed. When we do the Expo Live, every session is up for 48 hours but they can still go to Cashflow Expo. There is a link to be able to buy it at a discount too. If they want to get all the sessions and they have lifetime access to it at that point. We also had a few giveaways only for your audiences and some note stuff too.

We did at NoteInvestor.com/gooddeeds. We had the 21 tips to note investors and 5 ways to use cashflow on notes. We have some free videos on Note Investing 101.

We got a one-on-one series. It’s pretty good. If someone wants to know a little bit more about notes and there’s nothing for sale there. You watch the videos and learn.

I recommend for people to check that out. I’m on your site now. I can tell you guys, it’s quality content. You know how to write, how to present things. It’s professional and you have experience over decades with investing in rates.

I don’t think it’s important to keep throwing up years. It reminds me how much older I’m getting. We still remember in our minds, you don’t gauge getting older by yourself. You gauge it by your neighbor’s kid because like, “Where’s the little Jimmy?” He’s like, “He’s at college.” You’re like, “What?”

The kid across the street is driving now and I’m like, “What happened?” Since this is the Good Deeds Note Investing show, we’d like to highlight a good deed that you all have done whether inadvertently or not but how someone else has benefited from your business and your note investing. We’ll put that there. Also, a Note and Bolt. If one of you could take one and the other takes the other.

I’m throwing you for a loop here but a Note and Bolt is a nugget of wisdom for the audience so training wisdom or something whether it’s a small business or something about note investing that maybe the audience wouldn’t get in another training seminar. A piece of advice looking back is a piece of advice looking back that you’d give to maybe a new note investor or a new entrepreneur.

I would go back to what I said is to align yourself with people that are giving the information. It’s an abundance mentality. You don’t have to reinvent the wheel. Buy things later out of profits. If you want to have a super fancy website, buy it out of profits later. Don’t put that pressure on yourself from the very beginning. I don’t think you have to spend $100,000 to learn this business and stuff. There’s a lot of good free information. You said NoteInvestor.com, I don’t know how many articles. We’ve got like 400 articles on there that you can read for free. Look at the podcast.

How did you get that URL? That’s a pretty good one.

We’ve had it for many years or whatever.

To piggyback, I love the whole, “You don’t have to reinvent the wheel.” You mentioned that a couple of times. That, for me, gave me a lot of confidence as well initially going into real estate investing because I don’t have to be the next Elon Musk here like, “It’s been done before. I could tweak it. Maybe I can make this better. Improve this part of the process.” That gave me a lot of confidence to move forward seeing that other people have done it.

The only thing I would add also and we’ve always had this rule. No one’s going to watch your money like you. Sometimes you want to take a shortcut and somebody says, “If you invest with me, I’m going to be buying notes or if you do this and that.” We don’t recommend that. If you’re going to buy somebody else and your name needs to be on the paperwork. You’re not investing with somebody else. Nobody watches your money like you. I don’t say that to scare anybody. That’s a good rule of thumb regardless of what you’re doing but you should. You can’t rush it. Don’t force the deal if you’re going through and you’re on the fence then don’t buy that deal. Broker it, make a few bucks and something like that but don’t put your own money in that deal.

It’s interesting because I’m sitting here, “What do you pick?” You can tell stories where you help somebody, especially in seller financing that was able to buy a home that was turned down by a bank and now own that home. We have several of those situations. That is a good feeling. I think seller financing serves that segment of the market well but what was in my mind that happened was we had a person we were working with that found a deal and bought a little partial. It was all new to them, this whole partial concept. Many people say, “You can’t buy wholesale partial. You can’t do those things anymore. It’s the old way.” I’m like, “You can still be done on certain deals.”

They found it. They learned how to use the amortization schedules how to use a financial calculator. It all happened in this short amount of time because they bought the note, the partial and it paid off all within a year. They had this crazy great windfall. It was fun to see that excitement and giddiness in helping somebody else do the same thing. That still gets me excited about the note business years later. I’ve taken a lot more joy out of working with people to do the same thing. I can’t say my younger self would have enjoyed that as much as my older self does. I’m enjoying that aspect of my life.

I think that’s good. At least with my mentorship program, which is not robust. It’s not my main focus but a similar thing where one of the people I’m working with said, “You don’t charge enough.” The thing is I do enjoy it. I’m not saying I have all the answers either or I’ve conquered the world or anything but I love helping somebody who maybe I’m a little bit further down the path and seeing those light bulb moments as you said, Tracy as far as like everything comes together at one time and that success for someone else is cool so that’s good.

We’ve not only given them. What’s interesting is that we talk about people for their first deals. It’s like the light bulb moment. I used to talk about that when I used to teach financial calculator and people you’re like, “I understand it.” It’s not only the gift of that one deal that you’ve helped them do. You can see the level of empowerment that they now have on, “I can do this again.” Even if somebody did four deals a year and it was an extra $15,000 or whatever it was if they’re brokering and we’re like that. That can have an impact on something. We have a saying that we say even before we made a lot of money was the whole, “Never think $500 isn’t a lot of money because it is to somebody. Don’t ever think $500 or whatever it is is not a lot of money.”

That’s the threshold of money we spend before we talk to the other person even now.

I buy a lot of things at $499 or installment plans.

This has been good, guys. This is going to be a unique one for sure, in a good way. The couple’s angle, the family angle and the small business and note investing. We’ve hit a lot of cool topics. Is there anything else you want to add?

I’ve read to your show. I enjoy it. I like the way you guys approach. You’re giving as well. We need more of that in the industry so thank you for having us on and for sharing your own unique aspect of how you come to the business.

I appreciate that. Chris and I try to keep it real on the show. There are ups and downs as we’ve touched on. There’s good, bad and ugly. We wouldn’t be in notes still if it wasn’t a great investment strategy and a great way to go about investing in real estate but it’s not always rainbows and butterflies, as some people like to present it.

This has been great. I appreciate it, Fred and Tracy. Thanks so much for coming on. I know you are busy.

Thank you for having us.

I recommend the audience go check out a Cashflow Expo and NoteInvestor.com. Any other plugs you want to mention?

No, that’s plenty.

That’s good.

Thanks a lot. I appreciate it. To the audience out there, please go out and do some good deeds. Take care.

Important Links:

• NoteInvestor.com
• Cashflow Expo
• Wize Women Investors Expo
• Labrador Lending
• The ONE Thing
• BIFI Loan Servicing
• Quest
• NuView
• Cama
• Equity Trust
• Atomic Habits
• Who Not How
• DME
• IMN
• Loom
• NoteInvestor.com/gooddeeds
• NoteInvestor.com

About Fred Rewey

THE 9 SECOND BIO…

Fred enjoys golf, motorcycles, flying stunt planes, cigars, whitewater rafting, and is a self-proclaimed Online Jedi.

If OCD was abbreviated in the correct order, he would probably have it.

FAVORITE QUOTES

“Get busy living, or get busy dying.” – Andy Defresne, Shawshank Redemption

“…but I’m funny how, I mean funny like I’m a clown, I amuse you?” – Tommy DeVito, Goodfellas

About Tracy Z

Tracy Z has handled millions of dollars in owner financed real estate notes since 1988.

She headed up the due diligence department for one of the nation’s largest owner finance note buyers as VP of Production for Metropolitan Mortgage & Securities. Loving the business but wanting to work for herself, Tracy left the institutional investor side in 1997 to start Diversified Investment Services, Inc., a note buying company and NoteInvestor.com, an online newsletter for private investors.

Tracy specializes in the use of tax-advantaged retirement funds to purchase real estate notes and helps landlords convert to “lien-lords” by safely creating and holding paper. A well-known educator, she has a passion for sharing her knowledge and guiding others on their note investing journey.

She works alongside her spouse, Fred Rewey, providing unique insight on embracing technology to run a note business as a couple that loves to travel.0