Podcast 191. Passive Alternative Investments for the Average Joe with Patrick Grimes

Average Joe FInances:
0:00

Welcome back to the Average Joe Finances podcast. I'm your host, Mike Cavaggioni, and today's guest is Patrick Grimes. So Patrick, super excited to have you on the show. Thanks for joining me today.

Patrick Grimes:
0:10

Mike. I'm excited to be here too. A lot of things about your show and the fact that you're in Hawaii and everything else that I like about it.

Average Joe FInances:
0:16

Yeah, we were actually just talking about that a little bit off camera, how you spent some time out here during the pandemic. And in one of the nicest areas of the island when it comes to the, probably the best kept secret of where our best beach is. I'm not gonna say that publicly on here cause it'll get swarmed. But hey again, thank you so much for joining me. I wanna start this off the same way I start every podcast episode, and we'd like to know more about you. So if you could tell us a little bit about yourself. What's your backstory? Who is Patrick Grimes?

Patrick Grimes:
0:47

Sure. So today I'm the CEO and founder of Invest on Main Street, private equity firm. We provide passive investments in various asset classes specifically real estate, large apartment buildings affordable housing funds, and single family portfolio, as well as diversified energy funds. Really our thesis is to provide inflation heads recession resilient. Investments that are protected from interest rates and non correlated to the stock market and each other. So better retirement, faster, that kind of thing. I started out in mechanical engineering. I was mechanical engineering student in college. I started out as machine design. First job, the guy sent me on a tailspin, said, Hey, you're talented, but you should spend your money in real estate because my only regret is I didn't put more in real estate sooner. So that led me to just dump everything I had, which wasn't a whole lot into these double my money. Real estate deals, really, ones that development, pre-development. And I personally guaranteed it. I was like, ready to take on the world and slaving away, at my job. And then 9 and 10 happened. I lost everything. Wrote it down hard. A big bust. So learned how to dove back into high tech. Like many of your listeners, I was the average row working real hard, got to the point where I made considerable income again, got a master's in engineering and business, and I was like where am I gonna invest? Not in the stock market, cuz I still remembered, I gotta diversify out. So I got back into real estate, but this time more of the tortoise, not the hair this time, more recession resilient. This time more calculated risk by producing assets, not pre-development. And. So I then built a single family portfolio buying, renovating, and holding and renting. And then continued to do that until I traded up to larger apartment buildings, like toward, my first one was 86 units, and then I did once two plus 300 units all recession resilient markets. And then I diversified into energy portfolios to help further balance the portfolio and to non correlated assets. And so invest on mainstream has grown from all that. And now I'm full-time, exited the high-tech space, and my wife and I have freedom to do things like moved to Hawaii during covid and and do all kinds of fun things.

Average Joe FInances:
3:13

Wow, Patrick. That's awesome. And some background too, right? You don't hear too many people, or I don't think I've heard anybody yet come on this show and talk about how, their journey into real estate led into energy. So that's pretty interesting. I'd like to know more about what made you decide to diversify into energy instead of just sticking with, the multi-family assets that, that, were tried and true.

Patrick Grimes:
3:35

Real estate is an alternative asset. It's alternative to what most, the average Joe would have their funds in a 401K or an IRA, and that's what their employer would tell 'em, and that's what their parents did, and that's all they would know. And then maybe they've graduated to getting a financial planner, but then that financial planner just dumps them more into similar indexes. Sentiment driven stock market, very few long-term inflation hedged. It's volatile space, all in its one cyclic model. So alternative investing is real estate and other asset classes. Now you're talking to somebody who I believe in real estate, especially the fundamentals. And I think in any market you can make a good deal and find a good investment in real estate. And we can structure investments to out, to outlive and to actually thrive in a Dell market, such as our affordable housing portfolios and our workforce housing, multi-family deals there so that I don't lose it all again, but that is still one correlated asset. And you're talking to somebody who's. Lost it all in real estate before. And if you read my Path of Investor Guide on my website, which is a free download, it talks about how the middle class really had the 8% of their wealth in alt asset alternative investment. The high incomers of 25 and ultra wealthy have 50. But if you look at the stack of where all those where 25 to 50% of their wealth is. It's not all in real estate. In fact, that is one allocation of their capital stack. It's in other alternative investments. And the wealthy I invest for essential needs like housing, food, and energy. They invest for to pay no taxes. They invest in all kinds of assets that don't rise and fall together. And energy is the obvious. Next one, especially today in the supercycle when things are going up. Your investments on, unlike in real estate energy, they can ride off your ordinary income. So if you're high income earner, invest in energy. You don't have to pay taxes on that investment for the, for most of that investment. And we're seeing cashflow and appreciation in a completely different market then real estate, where real estate center is reset and the stock market's down, you can hang your hat somewhere. It's still going up. And so it quite honestly the converging of quite a few different theories, but the foundation of a healthy portfolio especially when it comes to winning with inflation. Now the strongest inflation hedge right now is oil and gaps.

Average Joe FInances:
6:00

Yeah. Yeah. That's a great point. And I think. Everyone talks about how they d diversify their portfolio. Usually talking about paper, assets, right? They're talking about what you were talking about earlier, right? In the stock market. You don't hear too many people saying, I'm diversifying my portfolio to not only be in these alternative assets of real estate, but to also into other alternative assets. Now, some people have talked about how they got into crypto and NFTs and all that other stuff. I don't. It's, that's not for me. I just, I never really got into that. I, other people also do, precious metals and minerals and things like that. It's interesting to have somebody come on and talk about the actual energy side of it. Cause I, don't think I've had anybody on the show yet that actually does real estate and energy. So that's pretty neat. So what kind of, assets do you have in your energy portfolio?

Patrick Grimes:
6:51

For the most part, to your point, that's absolutely true. Some people tend to be like that one trick pony, like you learn one thing and that's the one thing. The problem is when you get really badass at something, you get way too indexed in that one thing, and if you talk to more than people doing that same one thing, then they're just gonna get you further and further in that rabbit hole. And so you said that there's not a lot of people. Yeah, there's not a lot of people investing. That's what I was saying. If you actually point to how are the 5% or 10%, how are those people investing that are having their money work for them and having generational wealth? That's how they're doing it. But in energy it has, sometimes it can have a bad rap. It unlike real estate, which is, has very limited, shade in its past, it's far more revered as the capital storage and wealth builder preservation. And I believe that should be true. Energy can also be volatile and risky. Just like real estate can be volatile and risky. I lost everything in it. And there are lots of people that have lost all their money in energy deals in oil and gas. And so to answer your question, what kinds of assets recession resilient tax advantage inflation is? So we're invested in diversified funds, just like how you have hundreds of units in an apartment building. If one has a fire, one burns. If you have hundreds of units, that washes out in the economics. So if you drill one oil well or one gas and it fails, you're all in and you're all out, right? But if you do it over a large diversified fund then you can build economies with scale and it'll wash out in the economic. Similarly, when we do real estate, we buy in landlord friendly locations. And proven areas with adjacent buildings nearby that are producing. So we have proof, right? And we buy a secured asset. In our energy fund, we're buying leases. We're not exploring, call it wildcatting in the middle of nowhere and hoping we're buying a lease surrounded by producing wells on top of known reserves, and we're drilling multiple wells on those leases. And that gives us more assurance that somebody else has already done the highly risky thing and found the natural gas and oil somebody else also producing. And we're willing to pay for an existing asset, something that has already been determined and then farm it. Or like we do in real estate, we buy a building or buy a piece of plan secured asset and then build a proven business plan. And we do that. By diversifying not only at scale but across different geographies. And we do that by the diversify different products, putting some natural gas in some oil, not unless it's a pivot. You think about it, it's very similar to having a mixed use, multi-family apartment, mobile home, Airbnb, like a large different diversified portfolio at scale in multiple states across the country. We're just doing that and applying those same basic principles over to an energy fund. To allow a lower risk way to access it. Take advantage of the tax advantages, which, offset your ordinary income and provide for a more reasonable return, not a get rich quake, spin the big will and put it all on green 24 and hope for the best like I did back in 2008. And I didn't know, as that's what I was doing at the time. But there's safer ways to do investments in all kinds of vertical. Oftentimes you have to find somebody that's lost it all one time to appreciate those. And yeah, that's where we're at.

Average Joe FInances:
10:23

Yeah. Oh I know that for a fact. I bought my first property in 2007, so what do you think happened there?

Patrick Grimes:
10:29

Oh my gosh. Me and you both.

Average Joe FInances:
10:31

It actually knocked me out of the game for a while and I stayed away from real estate because I was I guess I, I let the fear get to me, right? I was very fearful of what could potentially happen next, right? Now I look at it as, okay, if something like that happens again, that's a buying opportunity. My whole mindset shifted. I think that's a what a lot of people who aren't really sure about investing at all, they have this fear mindset. And, that's one of the things that we try to alleviate on this show is, that's the first thing you gotta change is your mindset, right? If you didn't think to go a little bit bigger, right? You would've never diversified the way that you did and created this huge thing that you have now with an invest on Main Street. Which, speaking of, I want to ask you, because now that you have this well-oiled machine, no pun intended, right? Got the energy in there, but now that you have this, big thing going on, you know that. You're doing a lot, right Patrick? So what would you say or what are some tools, software, CRM, or anything that you personally use to keep yourself organized and track everything that you have going on? Because I know a lot of people when they start getting into this game and there's a lot of moving parts, sometimes you get lost in the sauce, right? So what kind of software do you use?

Patrick Grimes:
11:47

So I just, I come from an automation robotics background, machine design, and there's my master's degree in engineering had an emphasis in systems engineering. I know that way you're speaking is my language, right? And developing processes and Making things more repeatable and rinse and repeat. We talk about that all the time in real estate. I was like, I want this investment to be so boring that I've explained it to you so simply, and we just do it over and over again in the same way that it's so repeatable that it's boring. That's what I want. We don't want flashy, wild, and exciting things. But so we to answer your question, yeah. We have so we use Asana for project management, if that's what you're asking about. We use.

Average Joe FInances:
12:25

Oh, nice.

Patrick Grimes:
12:25

Slack.

Average Joe FInances:
12:26

Use Asana too. I love it.

Patrick Grimes:
12:27

Yeah, we use Slack. Use Slack. We use like three different types of backend portals. We have Update Capital, Syndication Pro, Next Fest. And we currently are launching a cash flow portal, which are all different kinds of portals that allow us to access different kinds of track, different kinds of investments. Man, we have a Zoho CRM and we have, which does pipeline and funneling we have active campaign, which helps us warm up and send out keep our investors appraised about latest investments. And trying to think on the front end of the back end, we have so many different tools that we use that it's gonna be hard to get to all of 'em, but, I would say that's the short list.

Average Joe FInances:
13:09

No that's great though. But you would say that, running some type of organization like this, you need some type of CRM system in place and software. That would just be too much to have on a spreadsheet, right?

Patrick Grimes:
13:20

When I started, I had this, I'm gonna start in a way to scale. And even though I started on day one with a website and a CRM and automations and building like This platform with information and investors and knowledge and content. I still to this day am like why didn't I start with a better one? I, why didn't I pony up and get HubSpot first, like on day one, because it was like a four grand expense or something. Just this time I was like let's step into this, and I started with an active campaign, but if I would've thought. Bigger sooner. I was thinking pretty big even then, but putting in investing in the software sooner, I think is wiser because right now we only need Zoho because active campaign can't get us where we need to go. How'd we done HubSpot? It would've done him. Or we had just, so I think it's something to think about. Definitely and it, without the systems and processes, we would've never been able to scale. We just for this last round of energy raising. We onboarded on a hundred investors just right before the holidays.

Average Joe FInances:
14:27

Awesome.

Patrick Grimes:
14:27

And we have 20 plus SOPs just for that, just to be able to get an investor into our system. And and there's so much stuff that's required to receive. An investor and get their investment in a securities offering. Not only in but the accreditation letters, the filings of the SEC and everything. And we have a whole team of people chunk along doing it. And we had two people leave right after. During the holidays, one had carpal tunnel and then she couldn't go. And then another one's mom had breast cancer and she asked if she could spend time with her mom. Oh. And then the third one's leaving now because she's been with me for four years and she's going on maternity leave. These all have an open invitation to come back, but they're still gone. And if it wasn't for these procedures and processes and systems, we'd be totally screwed right now.

Average Joe FInances:
15:15

Yeah.

Patrick Grimes:
15:16

And so there's really multiple there's a lot of different reasons, right? And so it allowed me the flexibility to let them go and still run a company and not have to like, no, you have to stay.

Average Joe FInances:
15:27

Yeah. No, you have a lot of fail safes in there. So that's great. The automation and just having these different processes in place, I think that's the most important thing is you have a really good process, right? You have a really good system. So I wanted to ask you, Patrick, from when you started to where you are today, what does your organization look like from the beginning to now?

Patrick Grimes:
15:51

It started out where I was just un analyzing single family homes myself. I bought the hold investor and I was just gonna hold homes forever. It's on the, it's the yellow one on thing right there and I was learning how to analyze deals, learning how to find recession resilient markets, ones that had bounced back quickly, learning about diversified employment. And this was when I came back after the big downturn and I was analyzing all the deals. I was flying to places like Houston. I was looking at the properties, I was building teams, property managers, inspectors, appraisers renovators, and in fact, The guy who renovated a lot of my properties as a single family now works for me and invests on Main Street and multifamily. Now cuz he reeled me in a single family. I reeled him in a multifamily, so.

Average Joe FInances:
16:37

There you go.

Patrick Grimes:
16:38

Yeah. I was doing a lot of that myself and the challenge was I was slaving away doing machine design automation and robotics. It's actually really tough job. And I was traveling around for that and for many years I was moonlighting this real estate stuff. Which made me pay and I didn't get married until I was 35, and it was actually then that I met my soon To be wife that I said, look, I'm gonna give this up. And she was there for my very last single family closing. I said, I'm gonna come back to this later, but I'm gonna do something different. And then I married her in California and in Beijing. And then after that's when I came back and said, okay, I'm gonna scale. I'm gonna go private equity. I'm gonna work with partners so we, so I don't have to slave away and do all these things I'm not passionate about, I'm gonna find what my superpowers are. I'm gonna bring other people that are already in the markets that I'm in that already have the know-how and knowledge. And we're gonna team up, we're gonna partner up, we're gonna scale in a way where we can scale by building out teams with processes and systems and partners. And it wasn't until I learned that I actually started succeeding better, getting into better assets. Ones that are larger apartment buildings with onsite property management that are non-recourse, that are much safer and better appreciating markets. I was able to build more credibility with buying power with brokers to take down bigger assets as a team, right? And so it wasn't until I did all that started building out partners, vertically integrated on the property management and doing having teams of acquisitions and asset management. As well as capital raising and man and building all those pieces together that where we are today. And doing that with strategic investments in strategic markets cuz we all have different people that have different verticals and energy or affordable housing or in large multi-family. And so just slowly bolting on and bolting on more strategic relationships than. That allowed us to also leverage people that are really great at what they've been doing, and they've been doing it for decades, right? I've been in engineering, these people have been doing nothing, but they're one thing for decades and they love it. They're good at it, and so it's really allowed us to offer a much more complete offering to our investor base and diversify alongside of our investors.

Average Joe FInances:
18:52

Yeah, and I think the important thing too, Patrick, that you're talking about is having the right people and the right job, right? And, you're obviously you've found those experts in their field and you get to utilize that expertise and it's something that you can be a little bit more hands off with, because the difference was, when you were doing this on your own, doing the, the single family homes, the buying, renovating, renting out, and, buying and holding you had to be that quote unquote expert in everything that you were doing right now, you're able to pull in all the experts in their particular fields and utilize their expertise while you can just be like, okay, I don't have to like, kill myself trying to get these assets and make this work. So that's fantastic. I wanted to ask you too, because there is a huge difference between the single family side and the multi-family side. Because I've done that too. And switching over. Now, I wanted to ask you, when you made this shift, and this is gonna be a two-part question, right? So you shifted to multi-family. What did you do to find deals there? And also when you started getting into the energy side, what did you do to find those areas where you leased the land? For the energy side.

Patrick Grimes:
20:01

This is a great question. When we started doing on the multi-family side, my wife and I were traveling. I was already traveling for work a lot, but she would come with me. I have companion pass, she'd fly for free. I would go to work and go do the meetings. We would then travel around, meet with brokers, tour all kinds of properties. We would look at the different brokerage firms, and then we would see what their previous closed properties are, and we would actually go, before we'd meet with the broker to four or five of their properties that they closed. And then we'd see, we'd ask them, so who. Who did you sell that to? Who did you sell this to? We walked this property. This is what we liked about this one. We like that, that one, doing our homework prior and then learning from them that they're like, oh wow, these guys have actually walked all these properties, like they're serious. Maybe if I give them a deal, they'll actually take it seriously and walk it themselves. Not only that, but when we found out who that the broker worked with, we contacted those sponsors and we're like, Hey, we watched your property and such. We just met with such and such it was just this really cool. Investment, excited. Let us know if ever need somebody. And then we learned a little bit about what their, why they are doing, what they're doing, what their buy box looked like. And we were able to start kicking opportunities to them that we saw Hey, did you see this? Did you see that? For the most part, they saw everything already, but that wasn't it. They saw us at the table playing. We were swinging, maybe we were playing little league, but they were like, oh, that's cute. One of these days they're gonna be like you know what, we're a player down. Why don't you come and help us out? And that's how it worked out. Actually. We brought deal after deal after deal to all kinds of people. It took me two and a half years looking for deals, underwriting deals, and analyzing them and doing due diligence, walking, flying around like huge sounds like a huge waste of expense, but it was the best hands-on education. You can, like learning the nitty gritty behind walking the units on what makes a good and bad deal. To where finally somebody goes Hey, you know what? I have this small deal and I'm tied up on these other bigger ones, but I have this small one. Can you help me get across the finish line? I can't let a guy, I really want to, I need somebody like you. You're out there, you're working hard. Let's just put you to work on this one. And it was 86 units. That was a small deal for him. So I went from a portfolio of three bedroom, two bath houses. And then my next small deal was 86 units and that deal's smoking. Right now we just increased the distributions of the 9% and so a year, which is awesome. And But yeah, so then I did everything I possibly could do to take this over the finish line and I record did zooms with my partners, recorded them. So I got everything and I was like, back I was like, back at Master's program again. I was like, but this is the one that actually matters, right? And I, when I got back on with'em, I had done everything, even re-listened to the Zoom to make sure I got every last little detail and I worked my ass off right over and even over holidays to make this happen. And then by the other side of that, they were like great job. Hey by the way, did we actually have this other one? You wanna do some of that stuff on this one? And then they had the third one. I was in parallel with the second one. I was like in secret, flying out from Hawaii, landing in Dallas, walking apartments and we're still closing on the second one. And I couldn't tell any investors about it cause I didn't wanna distract them. And then we finally, shoot, this is another good deal. So let's, so it was a deal after you showed up, looked like, and I actually didn't even know what percentage I was gonna be in the partnership pool. I was just really excited to be finally playing on the right field with the right players and it was awesome. And now it's a partnership that's never died down. We're still doing deals together. Of course, I have, half dozen other partners in other markets and other things but that's how I got into, a larger multi-family.

Average Joe FInances:
23:36

So Patrick, that's awesome. Before we get to the energy side of it I want to jump in because this is like exactly what I'm doing right now, right? So I've been at LP on a couple deals and I'm just now getting into the operations side to be a GP and I'm literally doing those things right now. That makes me feel a lot better about what I'm doing in my journey here. Had a call ear earlier this week with some partners and we're actually feeding some deals now and I might be looking at raising capital soon. I don't know. We'll see. Pretty excited about that. And that's, I, that's, so that was like a selfish question for me, right? Because I want to make sure I'm doing this right.

Patrick Grimes:
24:14

Everybody has the same question. I'm totally good. Yeah. And, but it, but I give you the, it's the hard way. The answer is you do it in the trenches and it's not, it's about being a servant first and it's about showing up with value and making sure you're in alignment with your partners. Cuz I walked away from a lot of deals, a lot of times because it wasn't exactly in alignment with my future bills. You're marrying these people cause you need to do a deal after, have to deal with them. So I hope I just, my answer was just work hard basically, is what I said. So.

Average Joe FInances:
24:45

Awesome . No, and that's what you gotta do. And like you said, too, it's the education piece of it too. By throwing yourself into the fire, you know that you're gonna learn a lot faster than, doing like a webinar or something like that. Just if you get in there and get your hands and feet dirty, it's, that's gonna be the best education you can get. All right. So Patrick, so now on the energy side. How do you find those particular, areas? Because I feel like it's gonna be the same but a little bit different. So how does that look?

Patrick Grimes:
25:15

So when I got to a 500 million portfolio multi-family, I was looking around and I saw us coming into this recession and I was like, my investors are not diversified like me. My family actually, we're diversified in the energy and I, with my buddies, We're all in these alternative assets deals aside. And so I, I was like, read my passive investor guide, but they just kept what, more and more real estate, more and more multi-family. So I decided to take some of these deals that I'm investing in, vet them to a different level. Even got my syndication attorney. There was already, it turns out, the ones that I was list looking at, he was already invested long before me even. And it's been a billion dollars in transactions. These guys are solid. These alternative assets outside of real estate are very well known to a small group of people. That's the thing. We all, we trade 'em like baseball cards, but we don't wanna talk about'em because there's, they're a, they're much harder do due diligence on there's a different level of risk. They're structured completely differently and so it's hard to explain. People get really comfortable and use real estate, but. In order to be in a non-correlated asset, one that doesn't rise and fall with real estate, you have to be in something completely different. Fundamentals that is it takes a big leap. So we had to be really careful which one we go to. And so we did a lot of due diligence, sifted through my, I actually brought it apart here. Josh Musgrove actually invested in 40 different alternative assets and he helped we passed these deals and finally we found this one where operator, vertical for over 25 years fourth generation. And he had a structure that is diversified and we said, Hey look, if we massage this and shape this and package this in a way where it looks and feels like a multi-family deal because it you model what's like this old, what I call the old boring way. But you put it in as a new fund model where it's diversified and it's scale and you have monthly passive income, a return of capital, and an exit. And we syndicated, I think this is going to resonate really well. And we approached them and they had this, it was a perfect match. It was a perfect fit. And I joined the board and I'm a player now with the company and we have offered these That was a little different situation than the typical real estate deal where I needed to find somebody who was really badass at doing something else, right? Because I'm really badass at doing my thing, but that means I'm wholly indexed in this one thing. But now I have to trust and learn and do and, but we know how to, so we did so much due diligence that we actually have the knowledge, the network, and the resources to do. And the time and our bas and measures don't. And so we went to bat and we did all of that. We got this structured, we worked a lot long time. So it just took us months to get through this whole process. And then finally we offered it, and it was very well received. People really needed that. Especially today when real estate values are waning, cash flow's going down, interest rates are going up, and it's we see very clearly. The need for a desire for people to hang their hats somewhere where they're cash flowing independent of real estate. They're appreciating independent real estate and I income earners that don't wanna pay taxes. Even the wealthy invest and not pay taxes. You can do that in energy. So it was a really good and we're looking at couple other opportunities in the ha future on a similar path.

Average Joe FInances:
28:38

Awesome. Yeah, that's fantastic And I appreciate you sharing that with us. Cause it. It is important to diversify no matter what you're into. And a lot of times people look at real estate and say, oh, I diversify in real estate. I have a couple single family. I have some multi-family. I have, I bought a trailer park or an RV park, or I got some land, and that, but the thing is that's, it's all real estate, right? So it's all tied to very similar. To a very similar market, right? So if real estate's going up, the mobile home parks are probably also going up, the RV parks are probably also going up. Land value is usually going up, and when all that stuff's going down, the same goes for all those as well, right? Maybe not necessarily at the same rate. But it, they're all tied into each other, like you said too. And a lot of the other things too, if you're investing in businesses that are tied to the real estate industry, you're gonna see those kind of fluctuating with real estate too. So I think it's, actually, it's very smart what you did to get something completely outside of real estate that, it doesn't correlate with it, like you said. And that's fantastic. There, there's Not a lot of opportunities out there for real estate investors to jump into something like that, beside a real estate deal that they're looking at. With invest on Main Street, that's something they can look at. They can look at two different. Things that they get into with the same company, right? So I think that's that's pretty awesome. So especially for your investors that no can trust you, right? So they're already in a good spot because they've done deals with you on real estate in the past, and now you bring this other opportunity to them and it's like an easy yes. Yeah, I think that's awesome, Patrick. Okay. I would like to transition this into something I call the final round. Okay. It's where I'm gonna ask you the same four questions I ask everybody that comes on the show and helps us get into Patrick's head of how he is under pressure, which I'm pretty sure you're gonna crush this. If you're ready to go, we'll get that party started.

Patrick Grimes:
30:32

All right. Bag it to me.

Average Joe FInances:
30:34

Okay. Here we go. So Patrick, the first question of the final round is, what's the biggest mistake you've ever made in real estate?

Patrick Grimes:
30:43

When I was, I think I alluded to it earlier, but when I was real young, I was engineer. I was like, man, I'm gonna just, highest returning deal I can find. And I did my due diligence, this guy, but I did not look at capital preservation. And I didn't fully get the downside to fully recourse loan. And so when I invested heavy to double and triple my money every couple years I doubled and tripled my losses. And losing is much harder to recover from and than even just breaking even or losing your base. But when it hits you that hard, it's hard to crawl outta that. Certainly recommend being the tortoise, not the hair, and being more calculated and long-term focused, even if you're early on.

Average Joe FInances:
31:26

Yeah, no, absolutely love that. Be slow and methodical and it will come. That's the beautiful thing about real estate. If you're doing it right, it's a get rich, slow system. Not a get rich quick system. Okay. Next question, Patrick, is what is something that you've learned that you wish you knew when you first got started?

Patrick Grimes:
31:45

Partner up. I, or especially after having lost big in 2008, I was really scared to ever work with anybody cause I was like I should only risk my own capital, my own investment dollars and I need to control everything, right? Because, lost this sense of trust in my investment portfolio. The re reality is I was really gonna make an income at my day job, but I was struggling, moonlighting to try and take over my investment portfolio. But I wasn't the qualifi, I wasn't the guy qualified to do it. And I was trading all the time away from my family, friends and hobbies to make that possible. And so partnering up when I finally learned to do that is when I finally began to scale more successfully, do what I love, and be able to give back to my family, friends, and hobbies instead of take it, take away from them. So that's my recommendation.

Average Joe FInances:
32:33

Oh yeah. Absolutely. Love that. It, it's, Real estate's not a game you should be in by yourself. You can definitely scale a lot better if you have partners. And like we talked about earlier, you were finding the right people for the right jobs. And that's another thing that's gonna help you scale immensely because you have experts in those fields where you can focus on what you need to do and let them do their thing. It just makes it like a well-oiled machine. There we go again with the energy. Okay. Patrick. Third question of the final round is, do you have any tips or tricks that you would recommend to someone that is just getting started out today?

Patrick Grimes:
33:10

So think big early doing the the single family thing, trying to control it and keep it small didn't serve me. I wish I had those years back and I had partnered up and allowed myself to be, yeah, I can become a private equity, I can get involved in these larger commercial assets and to talk and work with and basically it just takes time there. You gotta imagine these larger operators, these larger players that are out there doing the grunt work. It's a lot of work. They have hundreds of people coming and saying, Hey, let me play a role, let me help, let me, whatever. But you gotta be consistent. You gotta keep showing up and I think that as long as they see that and when they give you something, you deliver and you don't come with your handout first, leave with value first, and you be consistent. I think that eventually they will, or somebody adjacent to them will notice. And they'll put, they'll point you out in the crowd and say, yeah, let's do something.

Average Joe FInances:
34:15

I love that. I love that. Actually, I was at a meetup recently, and that's one of the things we were talking about is, when you create some of these partnerships, it's not about the person that just showed up with their handout saying, Hey I'm here. I'll help, I wanna be part of this. It's the people that actually show up and actually do help and actually do add value instead of saying, Hey, pick me. Adding value is the f the best way to get noticed to any team that you might be trying to be a part of, right? Absolutely love that answer for sure. Okay, so Patrick, this is the final question of the final round, and I will preface this with, besides your own, but do you have a favorite business investing or real estate related book or podcast, or both?

Patrick Grimes:
34:56

Who not how I think is the, actually I'm, I run around this, the lake behind me here in the mornings with my puppy. And so I'm constantly going through audiobook, but I've been listening to who Not How again, because more and more in my organization, I'm realizing the, you're getting the right people in the right seats. And it has really been empowering for me. I, us usually say the one thing, but right now I'm saying the Una, how it's just such an incredible book and I recommend everybody read that guy.

Average Joe FInances:
35:23

Awesome. And actually both are fantastic recommendations. So I definitely appreciate it. Now that is it for the final round. However, I do have one more question for you, Patrick. And this is the most important one of all, because people are listening to this interview and they're like, wow, I really like what Patrick's doing. I really like what invest on Main's doing. We wanna know more about him and everything that you're working on. Where can people actually find you? Do you have a website, social media, anything you'd share with us? I know there's a book. If you could tell us about that would be fantastic.

Patrick Grimes:
35:55

Yeah, so investonmainstreet.com, investonmainstreet.com. We have some open investments multifamily apartment building diversified energy fund, which if you get in soon, we actually have a special promo for earlier in the year which provides for some great. Growth returns right now in a down market, which is great. And we have an affordable housing fund, which kicks off single. It's a large single family portfolio hedges against delinquencies that because the government subsidized rents, it's fixed interest rates, so we don't have to worry about interest rate increases. And it's this exploding market, affordable housing right now. So we're providing in a need. And so it's gonna be growth, it's gonna be a huge growth in a recession especially stagflation. So I recommend people reach out if you're interested in that. And yeah, so we have, and I'm happy to chat with anybody if you are early in your journey and you just wanna have a chat, get you or advance and you wanna diversify, you're not sure how set the meeting you invest on Main street.com/contact. Just go to our website and click on contact or set up a meeting and I'd be happy to understand your goals and see if I can get your point in the right direction. I always offer a copy of this when I do podcasts which is called, it's a Amazon number one bestselling book that I put together with some, a handful of co-authors here. Persistence pivots and game changers turning challenges into opportunities. Persistence pivots and game changers, turning challenges and opportunities. And we did, in fact Brian Tracy did the forward Phil Collins, lead guitarist at Def Leppards in here, I did a chapter NFLNB a entrepreneur, speakers, coaches, players, just really cool people in this book. I just loved talking with all these guys. They have such extraordinary stories and I was honored to be among them in this book. I'm giving away free copies, shipped for free. The secret link though is invest on main street.com/book. Invest on main street.com/book. And when you go there, you need to go there and also in the promo code area type in. The name of this podcast, average Joe Podcast, average Joe Finances podcast, or some variant, there's something like that. So we know it's you and you're not a random, the website. And I'll sign it and I'll we'll ship you a free copy. I'm happy to do I think it it just tells our whole story, the ups and downs, the pivots, the lefts, the rights and how we ended up in Hawaii and how we ended up back. And and if that helps inspire your story, then it's enough of a gift back to me. Look forward to connecting and chatting with anybody who's interested and thank you so much.

Average Joe FInances:
38:31

Yeah, Patrick. Absolutely. Awesome. Thank you so much for joining me today. This was a real treat because I got to dig in a little bit and ask some personal questions for me that I think also helps my audience out as well. But yes, so I will make sure I have all those links in the show notes as well to make sure it's easy for everybody to find them. You can click away, copy and paste. Just don't do it while you're driving. Okay. And yeah, again, Patrick, thank you so much. This was fantastic.

Patrick Grimes:
38:59

Absolutely, Mike, I appreciate you having me.

Average Joe FInances:
39:01

Awesome. And hey, to my listeners, I wanna say thank you so much for joining me and our special guest, Patrick Grimes, on the Average Joe Finances Podcast. Go leave us a five star review and tell us what you liked about today's episode with Patrick Aloha from Hawaii and have a great rest of your day.