3 Degrees of Freedom

Ep 118 - Becoming A Co-GP With A J-O-B and Single Family Experience with Doug Spence

September 23, 2022 Season 2 Episode 118
3 Degrees of Freedom
Ep 118 - Becoming A Co-GP With A J-O-B and Single Family Experience with Doug Spence
Show Notes Transcript

Welcome to another episode of Elevate Your Equity podcast with Doug Spence, an active-duty Navy officer since 2009, and he started investing in real estate in 2016. Join us as we talk about how Doug was so driven to create this side hustle of investing in real estate. On the show, he also highlighted:

• What his off-market machine for acquisition looks like.
• The transition he made from single family (residential) to commercial.
• His recommendation and advices for other investors who want to take his path.


More about Doug. Doug has been an active-duty Navy officer since 2009, and he started investing in real estate in 2016. He completed his undergraduate degree from Baylor University and has an MBA from the University of Florida. He has experience investing in single-family homes, small multifamily homes, and mobile home parks. He also has extensive experience sourcing off-market real estate leads for himself and other investors. He recently became a general partner on a RV park syndication fund. He lives in San Diego with his wife Cait and their newborn son, Cal.

Connect with Doug on LinkedIn, Facebook and/or email him at doug@honorandequity.com.

Thanks a bunch Doug Spence for coming on the show!

Unlock 3+1 degrees of freedom (time, location, financial + health) with our 5 Point Blueprint! https://elevateequity.org/podcastgift

If you really enjoyed this content and are looking for more, you can continue to learn more about us in several different places for free!


If you'd like to have a FREE copy of our 7 Ways Commercial Real Estate Syndications Protect and Build Wealth, simply click the link below. We are here and vested in your long-term success! elevateequity.org/7waysEbook

Unlock 3+1 degrees of freedom (time, location, financial + health) with our 5-Point Blueprint! https://elevateequity.org/podcastgift

If you really enjoyed this content and are looking for more, you can continue to learn more about us in several different places for free!

If you'd like to have a FREE copy of our 7 Ways Commercial Real Estate Syndications Protect and Build Wealth, simply click the link below. We are here and vested in your long-term success! elevateequity.org/7waysEbook

Introduction:

Welcome to the Elevate Your Equity podcast where we, as married busy professionals, leverage real estate investing to unlock the three plus one degrees of freedom, health, location, time and financial.

Derek Clifford:

And today I'm super excited to bring on Mr. Doug Spence. How're you doing, Doug?

Doug Spence:

Doing great, Derek, how are you?

Derek Clifford:

Awesome, man, thank you so much for coming on the show.

Doug Spence:

Yeah, thanks for having me. Really excited.

Derek Clifford:

Absolutely. And for people who don't know who Doug is, Doug is an investor out of San Diego, California. He's also a Navy officer full time and does real estate on the side. Currently, he has experience with a bunch of out of state bursts and flips, does off market lead generation, and recently became a general partner on a syndication fund that invests in RV parks. That's awesome. And he's also married to his beautiful wife, Kate, and they have a newborn son named Calvin. So Doug, you are a very busy guy, you got a family, a young family and home, you got a full time job. And you've also got a full time side hustle. So really cool. And let's hear a little bit more about your story. Why don't you tell the audience and also tell us a little bit about how you got excited about real estate investing and how you got to today? Yeah, absolutely.

Doug Spence:

So you know, originally from Houston, Texas, and like you said, I'm active duty Navy. So I've been in the Navy since 2009. Lived multiple locations, you know, lived in Japan lived in California, Florida, kind of lived all over. And I was stationed in Pensacola, Florida as a flight instructor in 2015. And that's when I really started getting the real estate bug because I was renting a home for $1,500. And I realized just looking at like Zillow, I was like, I could buy a home that's nicer, newer, and just overall a better home and my mortgage would be 1100. So it was like, that was the extent of my real estate analysis at the time, but it was sound analysis, right. So I ended up buying that house with the plan to rent it out. When I moved away from Pensacola. And little did I know I'd be able to rent it out for like double the mortgage payment. I mean, I just bought this house is a great neighborhood bought it at a great price at the right time. I'm just paid for for retail, right? And ended up renting it out still own that house today. And so I kind of kept the bug that way. You know, it's like, okay, this, this makes a lot of sense, you know, did my taxes the first time I had rental income, and I was like, wow, this is amazing. So then I got into turnkey investing. So where you're buying from a company that basically flips homes, and then they sell them to investors, and they're already cash flowing from day one. So I did that, that's a good option for people that are maybe they're working full time, they're too busy to do their own stuff on the side. But they still want to own real estate so that that's a good way to get your foot in the door on real estate investing. So I ended up buying three of those from a company. Great, great company, great guys. Also Navy folks, that it's at one point I realized I really want to get more cashflow, to be able to reach my long term goals. I'm not going to hit that by just buying single family homes. So then I'll say okay, I need to start need to start burning. So that's why I got into, you know, read David Greene's book about burning in long distance real estate investing. And that's what got me into the burrs and flips and stuff. So, yeah, it's been a it's been a good journey. But I've learned learned a lot.

Derek Clifford:

Yeah, really, really cool. And you know, you make it sound very casual, right. But I know that you've got a full time career, you have a family, right? You have a life as well. Can you talk just a little bit about how, you know, you're able to make the space for this, because it's great to be able to do this with you know, profit in mind, but like, what was your overall why behind figuring out how to do this and why you were wanting to do this for yourself and your family?

Doug Spence:

Yeah, that's a great question. Because I was planning I was actually planning on getting out of the military at around the same time I bought that house or work for some big corporation and you know, find some good paying job. But I you know, as I listened to bigger pockets and learn more about real estate, I was like, I don't want to just climb some corporate ladder and you know, end up getting more pay, but working more than the government takes more of your income if your W two. So I was like, I need to, you know, what's the way to do it the other way is real estate, you know, from self educating via BiggerPockets podcasts and books and all that. So, I ended up eventually reaching the goal of I want to totally replace my income and my wife's income, our W two income with passive real estate income by the time I'm out of the Navy. So that became the goal. And then it was like, Okay, how do I, you know, like, long, you know, five to 10 year goal, because I'm still seven more years at least. So that's like, the far away goal. So then it's like, okay, how do I, how do I achieve that? And then it was like, okay, I can buy houses and then I'm like, Okay, I have to buy a lot of houses to kill. So how can I? If I'm worried though, I can really accelerate that you By using, you need a lot less capital than if you're buying turnkey, or you're just buying off the market. So then just gradually learning more and more about real estate getting connected with folks that are involved in real estate and go buttons and another mastermind group that I'm in and seeing how these people have done it, and seeing how the crazy entrepreneurs and real estate addicts in Gabon, it's really, you know, inspired me to reach bigger, I guess you could say, you know, increase that ceiling and see what's possible. So yeah, that's, that was a huge part of it.

Derek Clifford:

Yeah, I love that I love that answer that you are surrounding yourself around people that are doing really inspiring things. And originally, it started as like kind of this passive income goal. But really, it's more about becoming a better person, just because you're seeing all these people around you, right? Like, it's the community that you're surrounded by, that's inspiring you to think bigger, I think that's really important for the listeners to take away, that if you're looking to do something, first find a why if you just say, oh, you know, I'm gonna start a side hustle up, because I want to retire by the time I'm 40, or something like that. That's awesome. And it's really great, but doesn't touch at the core of who you are as a person, it's not going to be the thing that's going to drag you through the ups and downs you got to go through in order to be the person you have to be and make the sacrifices you got to make in order to become the person you need to be to create the wealth that you're looking for. So it's kind of a weird thing to back up into it. But I think that y is a really big piece of it.

Doug Spence:

Yeah, and I think a lot of people hear when people hear that, and they're like, Oh, well, he just wants to, like, retire early and like sit on a beach. And and it's not really about that it's more about having the freedom to not have to work a W two in the freedom, I 100% will still work, there's no way I'm gonna hit 45 and retire and like, just do nothing like I'm not the type of person that can do that. But I like the ability to have the freedom to spend time with my family. Whereas if I was some corporate job, they'd be like, we need you to move here. We need you to do all this stuff. And it's really more about the time freedom. So.

Derek Clifford:

Yeah, I think that that's really important to keep in mind. Love it, man. So let's talk about the transition that you had, because I know we could we could explore a lot about birds, we can talk a lot about that. Because burgers, it's a beautiful art form. I love doing it. And it's a lot of people underestimate how difficult it is. Because it's like, in theory, it makes a lot of sense. And it's something that you can do once you understand how to do it. But man, Doug, there's a lot of touch points right there is you got to buy, right, you got to have the right contractor, you got to fit inside your budget, then you got to rent the right price. And then you have to refinance in at the correct ARV. So all that has to go perfectly, right or, yeah, and get a good interest rate. And all these things are happening over like a six to eight month time period, right? While you're doing these burgers. So your money's locked up, you're most likely attending to a daily because you have all these things to take care of with with rehab and everything. So it's a romanticized process. But once you break down, actually, before we jump into the transition to commercial real estate, once you break down, like the sacrifices you made to make the burrs happen, because you kind of like glossed over it as if it was something, you know, that you just did here and there. But I know that there's a lot of effort that goes behind it. So can you tell us a bit about that experience was like?

Doug Spence:

Yeah, so it's a lot of time spent before going into work. And after getting home from work and on the weekends. And, and honestly, a lot of emails sent while I'm at work and phone calls, so I'm at work, and thankfully, I've been able to have a job over the last few years that if I'm not deployed, you know, I don't have to spend 12 hours at work like it's, it's much more reasonable. So that helps out a lot. So I'm able to, you know, go into work maybe a little bit later, and, you know, come home a little bit earlier. So that's been very helpful. But you know, that being said, it is, you know, I'm up by five or 530, pretty much every day. It's also good being in San Diego, because the market that I do, the person is in Oklahoma, so if I wake up, you know, that's two hours ahead of me. So it's you know, business at 7am. Pacific is 9am in Oklahoma. So then that is definitely helpful. But yeah, I mean, sacrifices. I don't like using word sacrifices for that. But it's, yeah, it's just a lot of waking up early, and like, you gotta want it because, yeah, it's definitely challenging. And to get into the actual process, like you really hit the nail on the head, because in the podcast, it's like, oh, you know, buy rehab, rent, refinance, repeat, like sounds, it's simple, but it's not easy. So but yeah, I think that the key parts of it are the buy in the refinance, because you have to buy well below market value to make it work. And in this market, where it's like a crazy seller's market, and it has been for the last really since I started brewing, which was in summer of 2020, fall of 2020. It was tough to find deals then as well. Yeah. And that you know, we can get into the deal funnel and finding, you know, off market leads and how I've done that, but yeah, finding you have to buy this stuff at like a fraction of what it's worth in order to make it work at the end. So that's the first really tough part. And then yeah, then the refinancing stuff because it's expensive refinancing these things is, you know, the one I just did just the lender fees and the rate by down and all that was like seven grand or something for a house that was worth 150,000, you know, so it's a lot and you got a shop round. And it, it took almost two months to close on the refinance. From the time we started, like, it's stressful. And you're waiting for that appraisal the whole time. And that, you know, the appraisal, really, it's really important, like you said, it's stressful, but it's also rewarding, because you can get something that's cash flowing with relatively little capital involved. So it's, it's great.

Derek Clifford:

Yeah, I want to say to that, I think what you're doing is incredible, and very, very inspirational. Because in the market I that I've come to know, slowly transitioning from a tertiary market to a secondary market. And so back, the deals that I was doing back in 2017, are definitely not there anymore. Now, you have to work a little bit harder. They're still there. I agree with what you're saying there. But these people that think that you can go in and just do a burr on anything that that looks there is very difficult, because you have this, this interesting dynamic Doug, where you've got this bird that you have to pick up, it's such a big discount, but the ARV, and the rental value has to be there. So you have to somehow find this property that's got such a big enough problem. But yet, it's still in desirable area that no one else has picked it up, or you're doing something off market to find it before everyone else does. So let's talk about that real quick. So I just want to explore this because this is your your realm of expertise to what is your off market acquisition machine look like to do these bursts? Like just at a high level? You know, what are you doing right now? And how are you taking advantage of those leads? And what does it look like for you on a day to day basis?

Doug Spence:

Yeah, so we focus on SMS. So text message marketing. So I started with Coke, I hired a VA to do cold calling that didn't work. And then I started doing running my own campaigns, with SMS before I'd go into work and like text him throughout the day, and then I was like, I can't, I can't do this, I got to find. So I found a VA company that can help out and do it. And over the last few months ended up hiring them full time. So basically, what you know how it works in my market is Oklahoma, so specifically Oklahoma City and Tulsa. So I pulled the list from Prop tree and based on the criteria and the neighborhoods that I want to market to, I always talk with my real estate agent there as well to get her opinion on that. And we pull the list, we skip trace the list to get the phone numbers. And then we upload that to our software, our marketing, CRM software, and then the VA markets to them. And then he sends us the leads, and then I send them to our agent in Tulsa. And she follows up with the leads. And we get first dibs on anything if there's a property that they're motivated to sell. But it doesn't work for us. But she maybe has an investor that wants to buy it or maybe they want to list it, then we split that profit with the agent. So it works well for the agent, she gets more properties for her buyers list or potential. She's gotten listings from leads that we've generated. And it works great for us because we have someone that we trust there that can go and take pictures of the house and get under contract for us and all that. So big picture. That's how it works. And then recently started, sourcing leads for other investors as well as specifically like agents and brokers and investors. Once I realized I was like, man, everyone else is struggling finding deals. And I have this funnel that really works well. And I can do it anywhere in the country. So had that realization in Park City, actually, back in January. But But yeah, that's kind of big picture how the how the funnel works. But it does work. So it's good.

Derek Clifford:

Yeah, I love that man, that's a great way a great way to add value to yourself and others. And I think that's really cool that you've got that in addition to, you know, again, I want the listeners to understand that this is a separate business to the because you could easily outsource the deal finding and just go to wholesalers and do burrs that way, right? Obviously, you're paying for that one way or another because the wholesaler has to be in business. Also, you know, you've got the direct marketing business, you also have the burr business where you're working with your contractors, and it's kind of integrated with your other stuff. And then you've also got this, this fun thing as well on the commercial side. Let's talk about that real quick. Because, you know, really what I want to do is I want to inspire the listeners to follow along in your journey to do something on their own first to get their feet wet in the single family space, because that's what I did. That's what a lot of serious real estate investors do starting out, but maybe some people want to go directly into commercial when they start. So can you talk a little bit about your transition from I'm not gonna say transition because you're still doing single families but how now you're building your experience up in the commercial space right now, what that looked like and where you got inspired and how that occurred.

Doug Spence:

Yeah, so you know, it's, I call it the natural progression of a real estate investor, right so people get started doing single family homes first and flips. And then they're like, Oh, this is great, this works. And then they're done. They're like, man, they do the math. And they're like, I'd have to do like hundreds of these to, you know, hit my goals. And you know, David Osborne has done that, and it's worked for him. But tough part about the bursts and flips is you're doing everything, you're finding them, you're, you're doing everything right, depending on how your system is set up. But if you can get into, you know, the commercial space, whether it be multifamily self storage, whatever, then you can determine your strength, which is something you talked with with us about a few months ago, you find your strength, what you're good at, and you join a team, and you just be really good at that one thing, whether it's deal finding or asset management, or underwriting or whatever. Now you're part of this bigger thing with people trying to achieve the bigger goal, whether it's, you know, no matter the asset class. So that's kind of that became one of my goals for 2022 was to get involved in more syndications with some folks that I haven't been following and, you know, trust and people, I like, what they're doing and all that. So that's what kind of led to that. Yeah, it's the natural progression of it, especially for folks in like, don't want, it's where it's, you know, you're, you're surrounded by these people that are doing the, like, you know, it's like when you bought a golf course, you know, like all this crazy stuff. And you're like, What am I doing buying crappy single family homes, if these people are buying resorts, and God knows what else they're buying? So it really makes you stretch? What what's possible. So it's Yeah,

Derek Clifford:

I love that. Now, let me let me ask you to though, I know that the mindset that it takes to go from the single family space to the multifamily space, you touched on it there a little bit, which was, you know, you've got, you're moving from being a lone wolf. I mean, you've never really, truly alone, right, but like you're the sole owner, usually right in these things, or that it's you and one other partner, but you're truly entering into something where you have a specified role. And you're a small piece of the machine, or at least a smaller piece of the machine. And the idea is not to get a bigger piece of the pie, but just have a small piece of the pie and get more pies. Right. That's the that's the idea. Right? Can you talk a little bit about the mindset that that must have been for you because I know, because this happened to me, too. When I go into multifamily, I was like, I'm going to be giving away a lot of the equity, like the equity is going to be split among a lot of people. And I don't know if I want that I'd much rather keep it for myself. Right? Can you talk a little bit about that mindset? And did that happened to you at all? Or how did that work for you?

Doug Spence:

Yeah, I think it's really just being mentioned good once again, but he you know, he one of microtome calls and talking with folks. And, you know, yeah, you can, if there's like a $10 million apartment complex you want to do like, yeah, you can do it by yourself. I guess, I don't know if anyone ever has, but like, theoretically, you could, if you wanted to underwrite everything, you wanted to go in there and inspect the whole property, you wanted to raise the money yourself, Sure, great, but you're going to be so burned out, you're not going to have work life balance, you're probably going to make a lot of mistakes. Because there's no one is really good at everything needed to do for something like that. So it's really just being able to figure out what you're good at, leverage that strength and join a team of other people because I'm I'm not good at underwriting. I don't like living in Excel. And figuring out IRR is like, I hate that stuff. But there's other people that love that stuff. And they're really good at it, but they don't like talking to investors or, you know, talking to people that potentially want to sell a property like I like that kind of stuff. I like talking to people that can stuff but, you know, whatever, I'll do whatever I can do to not be in the Excel sheet. Right? So it's teaming up with people and leveraging their strengths. And then taking a you're splitting up that piece of look at it, many times, you're doing a certain amount of work, and you're getting a certain amount of equity. And in a commercial deal, how many single family homes would it take to get that same amount of equity, but I had many years of burning and flipping, and all that goes along with that, what it takes to you know, for one, you know, one small piece of the pie the commercial it so it's really just perspective, it's realizing that you're getting a small piece of a $10 million pie or whatever, but that's still, that small piece of the pie is a lot bigger than, you know, one bird project or two bird project. So it's really perspective. And, you know, it's it's fun working in the team with people, you know, in leveraging each other shrinks and all that. So, you know, it's just the natural progression.

Derek Clifford:

I think it is and it also speaks to the scalability of what it is you're trying to achieve right with the single family world no matter what you're doing. It's you like you're the impetus on things right? It's all on you, you it's very lonely to so you can have your spouse with you in one way or another right where they're there to support you and they're there to be with you and that's that's great. And you may have your vendors your property managers, your agents and everything. But you know, they're not really on the equity side for you that you pay them a fee and if you're not working with them and providing deal flow then they don't work either and they can find some other so like a freelancer right. But when you have equity part There's what's good for you is good for them. And what they find is good for them. It's also good for you. I think there's something beautiful about that, where you're holding people accountable on a much more intimate way, right by being a part of a team. And so that's one of the reasons why I knew at the beginning that I liked the lone wolf strategy. But I knew that it was holding me back from something so much bigger the scalability aspect there.

Doug Spence:

Yeah, the other thing that's cool is, if I'm doing a burr, and I've done a, we have our third or fourth, we're underway right now. And my sister in law, who's my business partner, she has been the private lender on all these projects. And it's great because I'm able to, you know, we are able to do a project, and she's able to make money off the interest. But if we're doing a bigger project, now I can say like, Hey, lots of friends and family members, like, everyone can get involved with this, right? So you can help other people invest in a lot of people out there that, you know, most people aren't in groups like abundance with all these different opportunities. So why do people it's like stock market, or that's it? Like, that's the only investing option they have. And as you and I know, like, that's, there's so many better options out there. Right. So yeah, we could be other podcasts on that. But like, but a lot of people don't have, they're not into groups that we have with the access to opportunities that we have. So being able to open those opportunities up for other people, I think is another really exciting thing. And something I like a lot about it as well.

Derek Clifford:

Yeah, no, that's, that's great. That's great. I love that I love the fact that you can get extra people involved and do more good as well during this route, right? Because you can scale up. So let's talk a little bit about this path that you took, right? Do you recommend it for everyone what you're doing? I mean, you know, here we are, we're isolating this business that you're doing right, in one specific conversation. But what we fail to remember a lot of times is that you also are working a full time job, and you've got kids at home now and you've got family, right? obligations to uphold. Do you recommend the path that you took for everyone?

Doug Spence:

Yeah, I think so. I mean, I guess, I mean, it depends on their goals, right? I mean, I'm pretty involved on like, the BiggerPockets forums and different, you know, Facebook groups where I try to, like help other folks, especially fellow military members, trying to build a real estate portfolio. That's like a big passion of mine, and so many people that are like, Hey, should I buy this property in Cleveland? And it's like, well, it depends like, what are your goals? Like, what? What are your goals? What's your risk tolerance? How much access to capital Do you have? Like, it all depends, there's no right or wrong for anyone. But that's what's so cool about real estate, there's so many ways to make money in real estate, different asset classes, different strategies, like lending, you can do wholesaling, burgers flips, there's so much to do that. You just got to figure out what you want 10 years from now, what does that look like? And then you just back it up to what do I need to do this year, this month, this week, today, and maybe what you're doing today is just reading 10 pages in a book, maybe it's really two pages of Eric's book, you know. So it's just backing it up to like, like in the one thing where he talks about those little dominoes, and you just got to push over that one tiny Domino. And then that makes the next big domino fall, you know, because if you look at the your goals, like, Man, my goal is to have, you know, a gajillion dollars passive in 10 years, like, that's daunting. So that's why I have to break it down to what do I need to do today? So maybe it's just reading a book, maybe it's just having a conversation with another investor, maybe it's listening to a podcast. So.

Derek Clifford:

Yeah, that's great advice. And I think it's classic, timeless advice. I love it. I mean, all the stuff right now is this, this is great stuff. So let me actually ask you, I'm gonna go into this just a little bit more here before I asked you the final question. And then we head into a Rapid Round, I want to ask you, you sound like a very disciplined person, you're working in your full time job in a place that I imagine need, you need to be very disciplined. But in addition to that, I wanted to ask you, you're waking up at 530. Every morning, you're very busy with all that. How do you set and maintain the goals that you set for yourself? Like, how do you do all that? Because you have long term goals and you break them out into short term goals. Can you talk about your process there?

Doug Spence:

Yeah. So I think a big way to do it is have the accountability from other people because and I am in two mastermind groups, I think abundance and another one called a war room. That's all military folks, either active or veteran that are involved in real estate. And I meet regular weekly with both of those groups, like in Gabon, it's to go pod and the other mastermind it's like your squad. And we talked about our goals, especially as you don't go pundits like you got the one sheet where you are very clear quantitatively about what your goals are. And then we do in our my pod, we do quarterly follow up say hey, how's your progress going? So really putting some intentional, deep thought into what your goals are, and then being in a group being surrounded by people that you that you trust, that will hold you accountable for those goals, because if you're like, hey, my goal is to do X, Y, and Z. This week, we're gonna have some accountability next week, and you're gonna have to say, did you achieve that? If not, why, like what happened. So, you know, not wanting to let him down not wanting to let yourself down. So it's really writing down those goals. And not just that random, but sharing them with other people and being really open about your goals and your why. And then them not just holding you accountable, but helping you achieve your goals along the way. So I think that's, you can't do it by yourself. I think joining a mastermind group for anyone that is serious about real estate, or anything else, really, I mean, find a group of like minded people, surround yourself with them. And that's how you're really going to grow.

Derek Clifford:

I love that. Yeah. Especially if you if you're working with people that you really connect with and respect on a certain level, and also have the discipline as well. I mean, I think it's really hard to find these mastermind groups that that has the people that think just like you, I think that's part of the issue. That's why you look for these quality mastermind groups to be able to find those people that can help you get to where you want to go. And then you're going to add value back to them as well hold them accountable to it, too. But I'm also wondering, too, like, when you're setting goals, I know that you can do that within a group. There's a lot of this, that's that's done independently. And so you know, what, what are you doing to bring those goals to the group? Like, how are you thinking about the goals? They're like, are you talking about what you want to do, and then backing it out into quarterly goals? Talk a little bit more about, like, how you're reviewing them on your own things that maybe people can take away if they don't quite have an accountability partner yet, but want to get into it?

Doug Spence:

Yeah, so I think like I mentioned a little earlier, you know, where do you want to be in 10 years, for example, take that, okay. Maybe your goal is, you know, a big one of mine is passive income, so that I don't have to work a W two, right? So, you know, I look at, let's say, 20,000, a month passive, like, really big daunting goal, right? But if you break that down, you know, okay, what do I need to do? Where do I need to be in five years? Where do I need to be in a year, and you just break it down in chunks? And so for example, this year, I wanted to increase my passive income, I think it was only like, I'd have to check my one sheet, but I think it was only, you know, like one or 2000. This year, which that's much more manageable. You know, like, that's, that's a few properties. That's a, you know, one deal, one commercial deal, you know, so, but but if I do that, and I keep assessing that every year for the next few years, like, I'm going to surpass that other, you know, that bigger goal. So it's just breaking it down, and seeing what do I need to do this year? And then not just what's my passive income this year? But how am I actually going to achieve that? Because that's something I've reached my one sheet to the San Diego governance, guys. And, you know, one of them asked, like, Okay, your goal is this, like, how are you going to do that? Like, what? And then I was like, right, I'm gonna get this many burgers in Oklahoma. Okay, cool. Because if you're just like, just some arbitrary goal, you know how to get into it, you're like, I don't know, like, well, then that's, you know, you got it, you got to be specific about your goals and how you're going to get there. So it's a trick question, but it does it does.

Derek Clifford:

I think it's, it sounds like it's really kind of this iterative process where you've got the goals to set, and then you have people to hold you accountable to how to get them if you don't know yourself, right? Like, the idea is that when you're setting these goals, you're trying to figure out like, Okay, what type of person do I have to be? And what do I have to do in order to get them? And you know, by having these accountability partners, they're forcing you to say, how are you going to do this? And then you're going to be like, well, I'm going to do XYZ, and then they're holding you accountable to that. So you actually do your goals, right? So I love I love that whole thing. And again, if this is like, you know, go abundance, one on one. And for those, for those listeners out there that are listening to this, and maybe it sounds foreign to you, but you like the sound of it, please get yourself involved in Emerg or ascend. I think it's a merge, right that Jamie Gruber heads up, there's ton of information on that online, go find out like how you can get involved there, because you're gonna find people that are just like you trying to do something. I know, there's other mastermind groups out there too. So I'm not going to knock them as well, because I don't know them. But I do know that emerge and ascend works, and then the abundance team. It's just, it's just amazing. So anyway, that being said, I want to ask you one last question before we go into the Rapid Round here. Last question is what do you wish that you knew starting out if you had to do this whole journey all over again?

Doug Spence:

So my first thought goes back to I think a similar question was asked in Park City to one of the guys when they were doing their like horizontal income stuff and or it might have been Mike McCarthy actually, who answered it he said that he wished he had gone tried to go bigger earlier. And I think that's it that just goes back to getting out of your comfort zone. So a lot of people like oh, I want to get started real estate single family home. That's great. That's how a lot of people start that's how I started but I kind of wish I had made the jump a little sooner because we are there's a lot of limiting beliefs that we have as as human beings like oh, I can't apartment complexes. I can't do that. Like that's, that's for people like Donald Trump and like these, you know, big real estate moguls to do, like, not me, I'm just a regular person. But like, it's rare to have people that do all these commercial deals, right? So I think going bigger sooner would be some advice I give myself because even if you fail, the amount of that you're gonna learn along the way is going to be so impactful. And you're just going to reach your goals that much sooner.

Derek Clifford:

Yeah, I think the reason that people start small is because that's where their mindset is, when they start this journey. Like they know that they want to get there. So if I was going to take away something from this, to kind of go a layer deeper, and I want to get your thoughts on it is work on your mindset. You know, a lot of people are saying, oh, I want to get XYZ, I want to I want to achieve something. Well, you know, you can definitely dig 100 foot hole with a pickaxe or I'm sorry, with a spoon if you want to. But if you really want to get there fast, right? Get a bigger, get like a shovel or pick ax or get all those tools, right? And give yourself yeah, hire someone to do I love that. It's my what's way better. But I think you know what I mean, right? It's like, if your mindset like I and I'm a pure believer that when you start small, that's just where you are. So if that's where you are, and that's where you need to be to feel confident, and then grow and get to the next step and do it. But I think the you know, like, it's easy for us to say, Man start bigger, like faster and earlier. But my thought is on this, and I'd love to hear what you think, is that we are just there. And we don't know that we could be that person. Unless you surround yourself around people. And then you you bring your mindset up to be that actual person that can do things bigger, straight from the beginning. Does that make sense?

Doug Spence:

Yeah. What do you think? I think you nailed it. It's like surrounding yourself with people that have done it before. That's That's key.

Derek Clifford:

Yeah. I love that, man. All right, cool. Well, this is awesome. I've really enjoyed this conversation, because I've seen a lot of like, what I've done in what you're doing right now. And it's super inspirational. And hopefully, for a lot of the listeners out there who are starting out or looking to scale where they're going, they can take a lot away from what you're what you're sharing with us here. So we're gonna do, yeah, we're gonna head into the Rapid Round. And it is five questions that we ask every one of our guests and they're meant to be answered in about 30 seconds or so. So are you ready?

Doug Spence:

Ready. Let's do it.

Derek Clifford:

All right, number one. What book has had the biggest impact on you and why? And we ask that it not be either the Bible or the purple Bible, which is the Rich Dad Poor Dad?

Doug Spence:

Rich Dad Poor Dad. Yeah, so I think so. I'm gonna I'm gonna say a book that probably a lot of your listeners haven't read. Rich Dad. Poor dad has been impactful, obviously. But another one less lesser known is called the Road Less Stupid by Keith Cunningham. Have you read that one?

Derek Clifford:

I haven't. I think it's on my list. Now.

Doug Spence:

It's so good. He's like a wall. 30 seconds. So he's like a entrepreneur, serial entrepreneur, very experienced guy. And he basically breaks down like things to do things not to do in business and the concept of thinking time, which is like critical thinking about problems you're having in your business. It's great. We've incorporated that into our business and we do weekly discussions on it. So yeah, the Road Less Stupid by Keith Cunningham is excellent.

Derek Clifford:

Love that, man. Awesome. Number two, if people wanted to emulate your success, what is the first actionable thing they could do to follow in your footsteps? And before you answer I think I know what you're gonna say but.

Doug Spence:

What a mastermind group I, because we hit hit on that a bunch, I would say live well below your means because and have as highest savings rate as possible. Because if you want to get started in real estate, you have to have good credit you have to have a good debt to income. So you have to have a solid foundation and personal finance just to get started in real estate with that first house. So I would say you know, have those sound personal finances, you know, have those good foundations. And it all starts with living well beneath your means.

Derek Clifford:

Yeah, love that. Fantastic. Number three, what is one tool process or hack in the last three months that has helped you save time and or effort in your business or personal life?

Doug Spence:

So we have started using on the birth side, we'll really not just the birth but on, you know, business in general side. We've been using both Slack and Asana. Slack is a messaging tool. And you can like have team team members on it. You have different channels, we're talking about different topics. And then Asana is great for it's technically a project management tool where you can assign tasks to different people to actually integrate with each other slack and Asana. So in both, there's free versions of both that are more than what we need. So it's like not even that expensive. So slack and Asana.

Derek Clifford:

Yeah, that's fantastic. And actually for the listeners out there who have listened to a bunch of shows you'll notice that that is a common pattern. We're hearing a sauna Monday click up like all these project management software's had been a huge game changer and it makes total sense because the prod manager in me says yes, more project management is a better is a better thing. So let's do it.

Doug Spence:

It's actually reminds me I have outstanding tasks in my Asana that I'm like, oh shit, I forgot about this. So yeah, see, there you go. If the task is created, then you're like, like, oh shit, I want to I want to knock that task off, you know, because it's like, satisfying to knock it off soon.

Derek Clifford:

Yeah, for sure. And there's really cool automations that you can do to with the paid version of Asana. And then also, you can use Zapier to to do some stuff as well. And they have free versions. Yeah, yeah. All right. Number four, if the people that you know how to describe you with one word, what do you think that word would be?

Doug Spence:

That's a good question. There's a lot of words, some positive, some negative. Straightforward would be a good word.

Derek Clifford:

Go. I like that.

Doug Spence:

Both both good and bad, you know?

Derek Clifford:

Yeah. I like that. I think that's a good, a very straightforward answer. I love it. Number five, what is one small thing that most people do not know about you?

Doug Spence:

I've been struck by lightning before.

Derek Clifford:

You gotta be kidding. Seriously.

Doug Spence:

So yeah, so it was actually in an aircraft. So in the Navy, F 18. Super Hornet aircraft, we were flying through some weather. And our aircraft was struck by lightning. And, like, shut down for like a second. And then like, came back up and everything was fine. Did the lightning enter the front right of the aircraft? It exited the back left, and it like blew out the left aileron and the left stabilator. And but it was fine. But I'm struck by lightning.

Derek Clifford:

Wow, I bet it must have been really loud, too. Like it must have sounded like, I don't know.

Doug Spence:

It wasn't loud at all. And I think that's because typically when lightning strikes, and it's loud, it's when it's hitting the ground. What since it just struck us in the air, it was just a, like a bright flash of light. And everything shut down for like a second. And we're like, oh, shit, and then it came back up and fine. But yeah, it was kind of scary for a second.

Derek Clifford:

That must have been that must have been really scary. While you're, you're flying an airplane when the power shuts off, I imagine must be eerily quiet. I guess you have gas engines, right? Like, were you guys using props? Or was it a gas?

Doug Spence:

No, this was like to jet engine. So yeah, you and we're also we were also flying off a carrier. So we're in the middle of like the ocean somewhere? And of course, yeah. So it was.

Derek Clifford:

Wow, that's very interesting. I again, man, the engineers that come up with the ways to engineer for lightning strike while you're up in the sky. So amazing. I love it.

Doug Spence:

Well, they know what they're doing with the tactical aircraft or they're good at it.

Derek Clifford:

Definitely, definitely. All right. Well, very cool. Dude, it's been an honor having you on the show. And I loved having you to talk about all your experience and your journey. If people wanted to find out more about you, or just see what's going on in your world in general. How can they do that?

Doug Spence:

Yeah, absolutely. So love connecting with anyone chatting about real estate, especially military folks that are getting started on their journey or want to go from, you know, one to two properties, that kind of thing. I'd say reach out on Instagram, we're pretty active there at honor and equity on Instagram. And then also honor and equity.com. You can also email me directly, Doug do ug at honor inequity.com. And we'll have some we always have investment opportunities going on. So feel free to reach out to ask about those asked about the deal funnel, or if you just want to chat real estate so that my wife doesn't hear me talking about it all the time. So feel free to feel free to reach out.

Derek Clifford:

That's awesome. And yeah, thank you, Doug, so much for coming on the show. I encourage the listeners to please reach out to Doug, if you have any questions and just follow him on socials. And we'll link to all of that in the in the show notes for everyone listening on the show as well. So, Doug, thank you so much for coming on the show, man. It's been awesome.

Doug Spence:

Yeah, absolutely. Thanks, Derek.

Derek Clifford:

Absolutely. And for you listeners who have been listening to the podcast and have gotten to this point, I want to thank you guys for doing so. So please, wherever you are listening or you're watching this, please like comment, subscribe, rate the comment, give us a review, tell us how we're doing because all of that stuff helps appease the algorithm gods and then we get more exposure to more individuals. And that helps us to bring on more high powered guests just like Doug on the show. So thank you, dear listener for coming on the show. And and this is Derek signing off. We'll see you guys next week. Take care.