Tim Mai: Welcome to the Capital Raising Show. I’m your host, Tim Mai. Today, I have Gino Bovaro on the line with us. Gino is an amazing real estate investor, businessman, and entrepreneur. Not only has he built a portfolio of over 1,900 multifamily units and over 225 million assets under management. He has also taught thousands of other real estate investors.
You know about multifamily and his group of students have done well over 53, 000 units and over 4 billion in deal flow. Ideal volume. And, Gino and his partner Jake have, yeah, been real estate educators for a long time. Gina also has written three best-selling books, The Wheelbarrow Prophets, The Honeybee and Family, and Food and Fires.
And Gene, yes, Gene currently resides in St. Augustine, Florida, with his beautiful wife Julia, and there are six Children. That’s a lot. How do you do it?
Gino Barbaro: You marry up. You’re with the right partner. Just like when you guys are raising deals, you need to have the right partner. And she’s amazing.
My wife stays home, homeschools them, and just takes care of the family. And, to start family life and business life are pretty much the same thing. You need core values in business. You need core values in your family. And for me, it’s been an amazing journey. I love it. My kids are investing in the deals with me.
They’re in, they come to the events, and they see the life of an entrepreneur. So for me, it’s been invigorating. It’s been a great journey for me. So thanks for having me on Tim. I appreciate it.
Tim Mai: That’s awesome. Thank you. I’m honored that yeah, you’re coming on the show with us. I know.
You have a ton of experience when it comes to raising capital. And so really really honored to have you on. So yeah we love to start with, if you can share with us, how did you get into this multifamily commercial real estate space?
Gino Barbaro: Sure. I’ll give the 32nd overview. I got out of college a long time ago.
1992. I don’t know if he was older than me on the show, but 92 is when I graduated college. I went to work in a cubicle for a year, left that job, and got into the restaurant space. Believe it or not. My dad was a chef. He was an immigrant from Italy. And that’s how I got family food in the Friars. I ended up writing a cookbook about 10 years ago.
I was in the restaurant business for a good 15 years, 2008 came when I met Jake. I’m working harder, making less. I need to do something. I had already crapped out on a mobile home park deal. I had already crapped out on a mixed-use deal. I said, timeout, what do I need to do? And I saw one of your questions.
How did I get into multifamily? It was very easy. I had a job already. I didn’t want to fix and flip. So I said, multifamily is the natural progression. So I started my education in 08. Spent a ton of money. I look at it as investing a ton of money in mentors. Now met Jake in 2009, Jake moved down to Knoxville, Tennessee in 2011.
We partnered up in 2011. I’m the one who taught him everything. I still keep saying that. And it’s really funny because he didn’t know anything about the real estate space. He was a pharmaceutical rep, but he had the desire and he had the work ethic and we had values that aligned well.
And when you guys are raising capital, it is about values-based decision-making, whether it’s with your investors who are ultimately your partners. Or other sponsors or other syndicators or other people on your team. So for me and Jake, we aligned well. We wanted to have multifamily as the vehicle.
I didn’t want self-storage. I didn’t want land. We just focus on multifamily. We tried to become experts and I wouldn’t say that I’m going to, I’m an, I’m not an amazing investor. I’m not amazing in any facet of my life. I just work hard. I was endowed with. So not being that smart to be completely honest with these, but not being very intelligent.
I had to focus on working hard and educating myself and preparing myself. And that’s what I did for those two or three years before I met Jake. It took us 18 months to find that very first deal. And for us, it was. Not starting the syndication route. Because in 2013, there was very little money out there.
Consumer sentiments suck. There were tons of deals. There was just no money. So we started buying deals on our own. We started refinancing the deals, fast forward to today. We own about 1700 units. We only have one syndication left. The vast majority of them are our portfolio. We’ve been able to refi over 25 million from the portfolio and continue to scale up.
So our assets are around 225 million right now. And more importantly, it’s the Jake and Gino community. Am I an expert on raising capital? I don’t know, but the student base has raised well over 300 million. They’ve closed over 50, 000 units. And some of the things that we teach them about the brand, about the hook, about syndicating, right?
There are so many aspects to capital raising having a business plan, a buy right strategy, whatever that is, that all lead to capital raising. And for me, it’s exciting to be here because you have so many qualified guests here. There are so many people who have amazing resumes on here that have different backgrounds.
But I think the one thing that we can all agree on is when you’re raising capital. You need to provide value for that other person, right? You’re not asking them for money. You’re trying to offer them an opportunity. And if you can create your pitch or opportunity that way, I think that’s what we need to lead with Tim.
Tim Mai: I agree. And that’s one of the things I look forward to learning from you today is not only your own experience of capital raising, but The collective experience that you have seen what you know what works well out there with you know with your student base as well of how they’ve been able to raise all of this money.
And so yeah so when you first started did you hire a mentor, did you attend events or how did you learn this craft?
Gino Barbaro: So for me in 2008, I ended up hiring a mentor, rich dad, poor dad coaching. I even had somebody out there. Some of you out there know Craig Haskell. I had Craig Haskell as a mentor.
He passed away a couple of years ago, at the value hound Academy. He was a very important part of my life because, on our third deal, I utilized all his steps, his credibility book, his underwriting templates, and all. And for me, having that coaching allowed me and Jake to get that third deal. And. I wouldn’t be where I am right now without coaching.
I ended up becoming a life coach as well. Because I think coaching and asking the right questions is so important and looking at the coaching and then also for scaling up companies, we did something called scaling up with Vern harnesses group. And we also use traction with E with Gina Whitman.
And it’s amazing. I coached them and ended up podcasting them and interviewing my mentors as well. So that’s been exciting to be able to utilize their programs because we’re not born as natural-born salespeople. We’re not born knowing how to scale a company or how to buy a multifamily. It’s just not something that we’re not learning.
We have to learn these skills. And for me, I’ve invested hundreds and hundreds of thousands of dollars in that education, but it’s also allowed me to learn the skill and ultimately now I’m teaching it as well.
Tim Mai: I’m curious as to how you went into the teaching business. What made you decide to go that route?
Gino Barbaro: In October 2015, I decided to leave the restaurant during the week. So I’m like, my brother Mark was running the business. I’m like, I’m not working at the restaurant anymore. Monday through Friday. I’m going to do real estate and then Saturday, and Sunday, I’ll come to work at the restaurant in March of 2016.
I decided to leave full time when at the rail, I went to real estate full time and ended up moving to Florida and I moved to Jacksonville, Florida. And I remember in June of 2017, I moved to Florida and everyone’s telling me Jacksonville is hot. Grant Cardone has them on a podcast. No, one’s buying deals in Jacksonville.
And I listened to the people in the market who lived here. And unfortunately, I did that assets were 80 a door, 85 a door. Now assets in Jacksonville are 200 a door. So I didn’t buy any assets in the meantime. I said, Jake, I can’t help you with the property management because you’re up in Knoxville. What do we do?
So we ended up saying, let’s start the education company. It’s fun. Let’s start a podcast. Let’s start writing books. And it became a passion project for me. And from there, what I learned was when you do something in life, you learn it. And then you do it and then you ultimately teach it. And when you become a teacher, you learn so much because you’re forced to go to events.
I was at MFIN con this past weekend, learned a ton of stuff, met up with some amazing investors, and it pushes you to stay relevant. It pushes you to learn the content and it pushes you to make new connections. So for me, teaching was, has been, it’s been inspiring. And for me, it’s, when Tony Robbins talks about the six basic human needs, those first four fundamentals.
Number five and number six are growth and contribution. And I want it to leave an impact. I want to teach my children about legacy wealth and generational wealth, but also legacy skills. I want to teach my kids all about financial freedom. I want to teach them about money. And how do you do that?
By teaching others and being a role model to them. So for me, the whole education has been great. I’ve met so many new friends. And like I said, when I look back on my life, 10, 20, 30 years from now, I want to be able to say. Man, 300 people left their W2 jobs because of Jake and Gino. We raised 7 billion from this company, from this entity, or whatever.
That’s what I want to leave as a legacy. So that’s why I started pursuing it. And it’s just been a passion project for me for the last five years.
Tim Mai: I love that. What would you say is the amount that you and Jake have raised for your deals? And then what would you say if you have to give a rough estimate of how much your students have raised?
Gino Barbaro: So for us, Jake and I have only done three syndications. We’ve only raised about 12 million. That’s all we’ve done. We’ve been able to refi and pull money up, but for our students, over 300 million, I’m creating a spreadsheet to document all of their raises. And one thing that I see is that.
When students become successful in raising money, they create a brand. I don’t know if you’re going to touch upon this right now, but creating a brand, whether it’s the Jake and Gino brand, on our very first syndication, we raised 3 million in 24 hours because we already had a live event. We already had the books out.
We had the podcast out and we were already an entity known in the space and we already had education students that were on our lists. We were able to podcast Alex Hormozy a couple of weeks ago. I don’t know how many of you out there by show of hands know Alex Hormozy. Talk about brand and the amazing thing that Alex Hormozy said on the podcast was he was depressed when he realized that Kylie Jenner became a billionaire.
And why was he depressed? He was always focusing on advertising and doing all these click funnels when he said the brand is the biggest ROI that you can have. And he wasn’t depressed that she hit it. He was depressed when he was 31 years old. She’s 20 or 21. He’s what the hell have I been doing these last?
I’m like, Alex, you’re 31, bro. You’re way ahead of the game. Don’t worry about it. But that brand for the long term is what is the biggest ROI. And I think when you’re raising capital, it’s really important to create your brand. As for me, I’m learning how to sing opera. So I want to become a multifamily maestro.
That’s what I want to do. And I want to get on stage. I want to rip a little opera. You want to create a feeling, a sensation for people out there because it’s not what you say to them. It’s how you make them feel. And your brand should have a feel. The Jake and Gino brand. I want it to have a family feel.
We want to have people in our community that are all about family, that have those values. And how do you do that? It’s by creating that brand. And when Alex said that to me, I’m like, wow. And he’s the kind of guy that is not going to knock Kylie down. What he’s going to do is what you guys are all doing on the show.
How did she do it? How do I figure that? So that’s what he’s working on. And I think that brand is so important and we can all cultivate it. This is not a brand of 20 and 30 years ago when you were seeing CoCoca-Cola And Pepsi. This is the Roger brand. This is the Dylan brand. We all have our brands and we can create our destinies by creating our brands.
Tim Mai: I love it. Let’s dive into that. However, I’d like to know what were some of the challenges that you went through on your very first capital raising. And then, how does branding play into solving those challenges, or what is the, how would you do it differently now with that?
Gino Barbaro: For me, I would have all of my ducks in a row a lot sooner. We didn’t have a webinar done. The timeline moves so quickly on your first raise. And for us not having the investor scripts, not having the webinar done, not having the PPM in time. As I said, we were fortunate because we raised it so quickly and not thinking of it as an opportunity for me.
It’s Oh, should I let them invest? No this is a damn good deal. Let’s create some scarcity. Let’s create some desire. And the other part about it is. I didn’t look at it as a sales opportunity. What we were trying to do is we’re trying, we felt as if we were asking them for money. And what we do at Jake and Gino, we utilize something called same-side selling.
And it’s something that Ian Altman created. And it’s what he talks about with this acronym it’s called FIT. It’s finding impact together. And you need to find investors that are going to look at what you’re trying to do and see if it’s valuable for them. So I know in one of your questions, you had asked, what is your time horizon for your investors?
Right now, if, and when we’re going to start raising again for these larger deals, we want to have investors who have a long-term time horizon. So if an investor wants his money back in 24 months. It’s not going to be a really good fit for me or them. So when you’re looking at raising capital or creating a brand, make sure that the other person that you’re offering the opportunity to has an impact, you can find that impact together.
If somebody wants to join our community, Jake and Gino, they don’t have capital. They don’t have the right mindset. That’s not a good fit for both of us. So we’ll just say, Hey, you know what? Love you. Here are some resources. Do you know anybody who thinks this would be worth it? That’s one of the things I think about capital raising.
And I think the other thing was the deal was too small. We should have gone for a bigger deal to be honest with you. It was only a 6 million deal. It was only a two-and-a-half million dollar raise. So I wish we had, we wish we had gotten a bigger deal. And I think the last thing is having all your team members, just all lined up, making sure that you have the syndication attorney, the CPA.
I should have probably had a portal for investors. We didn’t have one at the time. We ended up getting crowded on the street, I think at the time. And now we’re a cashflow portal. Having that investor portal for us was important because you want it to look professional. This is your brand.
Once again, you don’t want to send that Google Docs, or Google Sheets. If this is going to be your long-term commitment, commit on the front end, what is it going to look like three or four years from now, your brand and start reverse engineering that and start doing that today? Because everything I’m somebody sees that name.
Seize your brand. They’re going to envision that and you want to start on a good foot in the beginning. Does that make sense?
Tim Mai: It does. That makes a lot of sense. Now let’s talk about the different components of the brand. Obviously for you, then, you look at your brand, Jake and Gino, I noticed you use the word community a lot.
So the community is a big part of your brand. What are the other major components of your brand?
Gino Barbaro: That’s a great question. When you think of the brand, we interviewed an expert on it and I remember what he said. It was Andrew Court on the podcast. If there’s one word that you want your brand to represent, this was an experience.
So when you go to his offices, you walk in, it’s just an experience for me. That one word is family. And I think the other thing that you need to do as a brand. On our podcast, we also podcasted who wrote the presentation Secrets of Steve Jobs. Gosh, what was his name? I don’t remember what his name is on that podcast.
It was enlightening. What he said to me, he says, take your company and rip it down to one or two sentences of what you do. Every company does this, whether it’s Google, whether it’s Apple, and it doesn’t matter how complex the problem you’re solving at Jake and Gino. It took me a little while.
And what our slogan is, or whatever you want to call it, is we create multi family entrepreneurs. That’s what we do at the company. And how do we do that? Different story. We teach people how to buy assets, but our USP, our unique selling proposition is we teach people how to manage assets. It’s sexy to buy the deal and it’s sexy to finance the deal, but nobody wants to teach you how to manage the deal.
And that’s what we do. And how do you do that by creating a multifamily entrepreneur, by creating them, and how to start a business? The cadence of accountability, the business plan, all the frames you need to set up. And that’s important. So when you’re out there creating your brand, what is it?
If you’re in, you’re a syndicator, maybe it’s very simple. I am a retired person. I love that because it tells you exactly what you do. You’re getting money and you’re investing money for other people. Now, you rip that down. But what is your brand? What do you want it to feel? What are the touchpoints?
And for me, we have these internal events. I want everyone to see my family there. We have four different podcasts weekly. I have a show with my wife. It’s called the Julian Geno show. We don’t talk about real estate. I wish we did. She hates real estate. I love real estate. And we’re there battling between husband and wife.
She brings in the family. I bring in the business, but that’s what I want. That’s what I want to fulfill for students. We’ve written children’s books. We have two children’s books out there. What does that have to do with multifamily? It has to do with the overall feel of the brand. We have a company called a hundred-year real estate investor, long term.
We also promote long-term in our brand. We’re selling whole life insurance to be able to take that money out of your cash value and put it into real estate assets. And also ultimately we have the Movers and Shakers podcast where we’re podcasting our students. And showing our students’ successes.
So the overall feel of the brand is the content that we put out as well as how to make it relevant and how to teach and help our students and have those resources that we can share with people who even aren’t in our community to bring them into the Jake and Gino community.
Tim Mai: That’s awesome. I know that’s quick but so powerful.
Gino Barbaro: It’s hard to jam it all in there. I try to put five pounds in a three-pound bag, but sometimes because brands are a lot of fun. We could talk about brands all day and when you turn something on, you are being bombarded every day by millions and millions of messages.
How do you cut through the noise? And it’s really hard because our attention spans have gotten a lot shorter. We’re doing 45 seconds, trying to do a 45-second video on interest rates. And it’s impossible, but it’s not what I want. It’s what the market wants. So if I want to be, reticent and say, I’m an old timer.
I can’t do it that way. Guess what? I’m not going to be relevant and I’m not gonna be able to share my message. So there are so many different mediums that we can utilize to do that. So figure out what you want your message to be, and then figure out how to, send that message out to the masses.
Tim Mai: That’s awesome. All right. So along with branding is the type of customers you want to attract. So who do, who is your ideal target that you go after?
Gino Barbaro: So for us on the education side, real quick, it’s People who have the capital, who have the right mindset. It’s about a growth mindset. It’s about coachable people.
It’s about people who want to become entrepreneurs and who want to leave their W2 job. Now for investors, when we started, we didn’t have anybody who had a pulse, anyone who had 50 grand to throw in the deal, and after your first deal, you’re like it’s not a good criterion there, and when you have an investor call you up and in the same sentence, say, I’m going to sue you because the K ones are wrong.
And they go, Oh wait, the K ones are good. When’s your next deal coming out? That person maybe shouldn’t be in our next investment. And I’m sure that’s happened to a lot of people listening to this call. So for us, it’s really to have investors who align with our goals, align with our business plan, align with the assets that we’re going out there and investing, and who have that long-term mindset.
Because we don’t want to sell these deals. If we can buy these deals and refi these deals in three or four years, I don’t. Replacing and sending that capital back to the investor. I want to keep the deal. You know how hard it is to find a deal that has cash flows. I want to have an investor who knows that the wealth mindset is created by owning these assets, rich people sell assets, and wealthy people own and keep the assets.
And our first deal in 2013 rents were 350 bucks for one bedroom. That same deal today, which I still own, which has put two of my kids through college so far, rents are 995 plus rubs. So can you see what’s happened to that one little 25 unit deal, the wealth that’s been created from that, if I can tell my investors that long-term time horizon, if they have that, then we’re a great fit?
If not, it’s okay. No harm, no foul. Do you have anybody else who would like to invest in our deals?
Tim Mai: That’s awesome. And so how, what channels of marketing do you use to find that long-term investor?
Gino Barbaro: For us, it’s the podcast first and foremost. We’ve got over a hundred thousand downloads a month.
We started five years ago. I didn’t even know what a podcast was when I first started. I’m not gonna lie to you. Jake, let’s start a podcast. I’m like, okay, what’s a podcast? We started just like everybody else. It wasn’t as crowded as it is now, but the mistake that I made when we started the podcast was we were doing it for fun.
If you’re going to start a podcast nowadays, make it niche, understand what you’re trying to do. Are you trying to learn? Are you trying to teach? Are you trying to raise? Capital is this podcast for dentists or doctors or attorneys, whatever, whatever that’s for us, we just started for multifamily.
There weren’t that many multifamily podcasts when we started. So the podcast is a great way. And we’ve just been utilizing Instagram the last couple of months, these shorts, these short videos, just for them to get a taste of what’s going on. And then YouTube ultimately is just another amazing platform to go out there and shoot these sorts of short-form videos and share your story.
Do you think video is powerful? And I think Jake and myself having different dynamics and being on camera is powerful. And then ultimately, we’ve written books, we’ve written five or six books. We’ve written a couple with our coaches, getting constant contact with that content out there, putting it out there.
And you don’t have to do this all. What do you like to do best? Do you like to write articles? Do you like to be in front of a camera? Do you like to do audio? Just pick one when you’re starting and get good at it and just focus on that one. And then ultimately you can continue to scale the mediums that you’re using.
Tim Mai: Things like podcasts and podcasts are a little bit easier that you can do without having a lot of experience because you can do interviews like what I’m doing with you, right? Books require you to have, I guess you can interview books as well. But what are some of the other ways that you have found worked well to establish some of your trust and credibility in the marketplace? Thank you.
Gino Barbaro: The first thing I would say is everyone on this call if you haven’t done Toastmasters, you should all join up and do a Toastmasters to get rid of us and the arms to be able to think quickly on your feet to be able to structure a presentation. I think that’s important and overlooked and I’m constantly trying to work on that skill set.
When I was in college and after I graduated I thought communications was the biggest joke of a major but ultimately. It’s probably the most important thing to convey a message to somebody. I think we need to focus on that. And I even forgot what your message was. Cause I just dumped that Toastmasters just jumped into my mind, thinking about what’s so important to create that message and to craft that message.
And I think the other thing I’d like to mention about that is we did a podcast with Oren Klaff and when we’re. He wrote the book, and pitched anything. I don’t know how many of you out there read the book or listen to the book. We’ve done the podcast. Go listen to him. He talks about the brain and this is important when we’re pitching ideas.
He talks about the Croc brain, the midbrain. And the neocortex now, most of us, when we’re having a conversation, the first part of our brain that gets activated is our Croc brain. That brain is the primitive brain. It sees movement to see something interesting. I’m pitching to Tim. I’m pitching from my neocortex, which is the high part of my brain to Tim’s Croc brain.
So if I jump on Tim and I say, Tim, I got an 8% prep. 18 IRR. You’re going to make sure what Tim’s gonna be like, hold on a second. I don’t know what you’re talking about, but if I tell Tim, Hey, basic humans need food, clothing, apartments, and an awesome skill set, you’re going to save a ton of money on taxes. All of a sudden I’m hitting his croc brain and he’s allowing me to get into it, get into that pitch.
I think if you start doing that and. Creating the story. You need all to create stories for yourselves. You’re all amazing people. We have, everyone has something unique about themselves. And until you put that down on paper and you practice your stories, it’s really important. I’ve got six kids. I’m an amazing chef.
I can sing opera. I own 1500 units. These are all things that are unique to me. Find out what’s unique to yourself, create two stories, create your founder story, why you got into multifamily or why you got into whatever you’re doing, and then create your purpose story. For me, it was really simple. I hated the job.
It was a rat race for me every week. I’d go to work on Sunday. The restaurant would pay me next week. Some weeks I made money. Some weeks I didn’t make money. I had six kids. Everyone’s telling me how you’re going to pay for weddings. Are you going to pay for college? That pissed me off. So I needed an outlet.
I need to find something to make money. That’s my founder’s story. That’s the reason for my story. Everyone needs to have that and create a storyboard. Seven or eight or nine or 10 bullet points and have that story memorized. And every time you speak to somebody or you go on a podcast, it comes up to you.
It’s not scripted. It’s natural. So create the story. Do people want to know about you before they know about the deal? They don’t care about day prep. They care. Is Tim going to be a steward of my money? Does Tim care about me? Can I trust him? And is he worried about me? That’s what they’re worried about.
And if you can get over that barrier with the Croc brain, then you get to his midbrain and go, okay, this sounds okay. Let me hear a little bit more, but until you penetrate that primitive part of his brain, everything you’re saying to him is BS. Because we hear it every day. I was going for a walk the other day and looked down and a snake was right there.
So that’s how the primitive brain works. It looks for movement. It looks for something unique, something different out there. That’s why everyone needs a hook. You need to have a hook when you get on because people have a really short timeframe and your croc brain is trying to save yourself from wasting that energy.
So it’s saying what’s different with Tim, what’s different with Gino, what’s different with Sharia. That’s what they want to know. What’s different? Then when they find out what’s different, they start paying attention. And then ultimately we learn in stories, great. is all awesome.
You need to know the numbers. You need to know what is in the deal. But if you don’t get through that first part, everything is completely lost and completely wasted. We did that prezone Charlotte last week. And I had that epiphany. We have 12 slides. Each slide should have at least one or two stories.
And at the end of the appraisal. I shot out a little opera, sang a little bit, and got a great round of applause. You make them feel good. They’ll remember that. And then they’ll go back and they’ll remember what you said because they paid attention to it and are trying to make it relevant to you. And I think the last thing I’d say, Tim is when you’re doing all of this, try not to be the hero in the story.
Try to be the guide. Most of you, when you’re listening to a podcast and you hear somebody on a podcast and it’s their show, but all it is about them, but them, about them. And it’s not about the guest. We get turned off by that. Be the guide as an indicator. Be the guide as the operator and let the person you’re speaking to the hero, ask them questions, really be genuinely interested in what they have to say, and listen to them.
And then you’re there guiding them. People don’t care that I’ve closed 1500 units and that I have 225 million in assets on the manager. What they care about is how can you help me solve this problem. How can you get me out of my job? That’s what you need to do. That’s why you need to be the guide and listen to them.
And everyone you interact with, they’re the hero. They’re the person you should be emphasizing on.
Tim Mai: I love it. That’s awesome. And then, yeah, I know you put out a ton of content, obviously with your podcast and everything. What are some other things that you do to stay in contact with and continue to maintain that relationship, especially the passive investors?
Gino Barbaro: So behind me, I’ve got November 5th and 6th. We’re going to be in Orlando. It’s five. You need to go to events. I, we have six or seven internal boot camps for our community, but we go to a bunch of events as well. And I think if you’re a syndicator, my brother did this beautifully last month. He had about 120 people he had up in Jacksonville.
He had all his past investors come to an event. I think he might’ve spent 10 or 12 or 15 grand for the whole event entirely. It was great. It was at the country club, get people together because you’re trying to create a community of investors. If you can create a community of investors, they’re your advocates.
And we’ve done so many podcasts on this as far as Joey Coleman and all the other guys were talking about that customer experience. The gentleman who wrote the book for the Ritz Carlton, I forgot his name is Horst Schultz. He wrote another book on customer service and that’s what you’re trying to create.
As an indicator, you’re trying to create that customer experience. And how do you do that? Thinking about that and having three or four of your investors who are advocates, they’ll raise all the money in the world for you. That’s all you need. So try to think of your business as one where you’re trying to create that customer experience for your investors.
And that’s what I’m trying to do with the Jake and Gino community as well. But go to these events, go out to these events and these mastermind groups, what we’re doing right now. I think those are all important to stay top of mind.
Tim Mai: Awesome. And I know that a lot of operators use newsletters and some even use direct mail newsletters. Have you found that to be very effective?
Gino Barbaro: Newsletter is another thing where people get something in an inbox. For me, I, We have a private Facebook group. So I use the private Facebook group for our community to translate, to get information out. I also do weekly lessons on Mondays at 12 o’clock.
We have a bunch of students who are in our weekly lesson, doing different topics. What we were doing during the pandemic worked well with our syndication company. Every Friday from 12 to two, we’d have open hours, and call for two hours. We were tracking daily. Do you remember those two years ago when everyone was saying no one was going to pay rent?
So we had daily tracking of collections. We were trying to be as transparent as possible and open as possible because people were afraid. They didn’t know what was happening. So for us, we were doing that. And also we’re doing end-of-day huddles with our team as well. So trying to get out and have that open line of communication is important in this, honestly, this part of the cycle, but that’s just the way it is with employees and with investors now.
There’s a fine line between badgering them and letting them know that you’re there. And if you have any questions, and if something’s going wrong in a deal, let them know, don’t bury your head in the sand, get out in front of it. And they’ll have a lot of respect for you because listen, it’s been a tough environment for the last couple of years for a lot of multifamily operators.
If you’re out there telling them, Hey, there’s no prefs this quarter because of this. I think they’ll understand. They see the job numbers. They see inflation. They see the stuff that’s going on. So being open and honest, if that’s part of your brand, which it should be. That’s just something really easy. You can do that.
Tim Mai: That’s awesome. And then I know you said that you started, you specifically wanted to niche into multifamily. Can you share with us how you went about making that decision?
Gino Barbaro: Oh, you mean leaving multi and going into multifamily full-time.
Tim Mai: Correct. Specifically targeting multifamily assets.
Gino Barbaro: Oh, that’s a great question. For me, it was a little bit of ignorance. I failed at mobile home parks, not because of the mobile home park but because of me. I failed. Because I bought something in New York. It was a strip mall and it wasn’t because of the asset. It was just because of me. And then it dawned on me.
I had a fourplex. I’m like, there’s not a lot of work going into managing four units, every month, couple hours a month, whereas at the restaurant, I’m working 60 hours a week. And I’m like, I love the tax benefits here. I love the ability to provide affordable housing. I love that ability to be able to get in with the residents and solve those problems.
And I saw that as a vehicle for me where we could buy 25 units on our first deal, get a resident manager, and still work full-time. And then three months later, we bought a 36 unit. So we’ve got 60 units within the first three months of our first property. Six months later, we bought 136 units. So at the end of the year, we’ve got 200 units.
We’re like, Oh, wow. I love this because we can hire property management. We can start scaling up. And then the last six months we’ve been buying scattered sites. So we’ve been, she’s been putting them together with our other large properties. And it’s given us those economies of scale.
But for me early on, I didn’t understand the power. Of multifamily when it came to becoming an entrepreneur and being scalable. I just didn’t know that I didn’t understand the multiple streams of revenue. We wrote the honeybee because of that, because of the multiple streams of revenue, whether it’s our education company, our property management company, the whole life insurance, or the syndication company.
And now we’re doing development. We bought two large tracts of land. We’re going to start building, build to rent. So that’s all from a little 25-unit property that we’ve been able to scale out in the last 10 years. And that’s what multifamily has allowed me to do. Now, if I wanted single-family homes, would I be here?
Maybe not, but I see so many students in Jake and Gino that start having 20, 30, 40. We just got two gentlemen on. I call them the Bucky Boys. I got a Bucky shirt here. That’s their brand. They go around, they wear Bucky’s and I remember them, Andy and Scott, they have a hundred single-family homes.
God bless them. Amazing. And they’re working W2. They finally came to me and said, I can’t do this anymore. I’m like, you know what? You guys are amazing. You’ve done it. Let’s implement some systems and let’s start buying assets that are contiguous instead of buying a hundred homes. All around this market.
So for me, I saw that early on, but then I noticed that the power to build a business, how many assets can you invest in where you’re investing in the asset, but you’re also able to build a business alongside it. There’s, I don’t, there’s not that many. And for me, it was like, this is great.
And as I said, ultimately it is a basic human need. Do you need an office space? Not really. People are living at home, self-storage down in the Southeast. I think it’s much more prevalent down here. I live in Florida. I don’t have, I don’t have a basement and there are so many people moving here. That self-storage makes sense here.
Retail, I don’t think retail is going to be great. Mobile home parks. It’s great. It’s a smaller niche. They’re tearing them down. I don’t want to deal with that resident base. So for me, multifamily has so much potential going forward and there’s not enough of it. As you can see, cap rates are not going to go back up.
I don’t think for the foreseeable future. If people are telling you that, I don’t see that because where’s the flow of money going? Are you going to put money in crypto? Good luck with that. Bitcoin’s Nobody wants to talk about it when it was 60, 000. Now it’s 20, 000. Now everyone’s trying to jump.
It’s not an asset. It’s an, it’s a speculative play for me. So investing in decades, looking for that cash flow, looking for that principal pay down, being able to build a business through it, being able to scale. There are so many benefits to the asset class itself.
Tim Mai: That’s awesome. And do you, and have you noticed, with your investors, if they prefer not just you, but not just your prop, your deals, but also your students’ deals?
Have you noticed whether or not you’re the investor, passive investors prefer that the operator is niche into one asset type or does it not matter.
Gino Barbaro: That’s a great question. For me. If you could be vertically integrated, like we are, it’s just easy, it’s the layout. We’re the property management company and we’re the asset management company.
So for us, it’s just one less hurdle to overcome. I think you have to be able to have some kind of expertise in space. And, when you’re raising capital and we’re a multifamily. I’d like to challenge everybody on this call. Even if you’re in self-storage, what are your buy-right criteria?
I think right now in this part of the cycle, we talk about the three pillars of real estate, but for us, being clear on what kind of assets we’re buying will give you confidence and will allow your investors to know that, hey, Jake and Gino, three hours in Knoxville, which We’re buying up to 200 units.
We’re buying in the 1980s and a newer median income of 50, 000. We’re buying two-bedroom townhomes. We love that washer-dryer hookups are crystal clear on what your criteria are. And that’s what’s allowed us to do when we find a deal. Boom, done. And I think every syndicator out there needs to have their business played and be able to convey that with their investors.
I think everyone here thinks about what your criteria are for buying a property. And I just mentioned a couple, you should look at the age of the asset. The location of the asset, the median income of the asset where it’s located, the unit mix, we love two-bedroom townhomes because they’re just larger and they’re so much easier to rent and you get more rent on those.
We like looking at properties that have amenities, washer and dryer hookups are great in the C space. There is another 50 bucks a month and revenue there. Look at some of that criteria and focus on it so when you bring a deal to a potential investor they know hey, this is good for me as well.
Tim Mai: That’s awesome. And, Some of the things that you recommended were podcasts, you do books, you do Facebook groups, attending events that you teach for the audience listening to take the people that you meet and funnel them into when Okay, you’re raising money and preparing them to have the money ready for when you have your deal.
Gino Barbaro: Yeah, this is a shameless plug for Hunter Thompson. I don’t know if any of you out there know who Hunter Thompson is. He’s got a great program and he focuses on raising capital on email automation and funnels and all that. I think that’s a good avenue for you guys to look at. But for me, SimpleCRM, we use ActiveCampaign and we use Cashflow Portal.
Cashflow portal. I love Perry. Perry Zhang is great. He is a syndicator investor who created a prod product to solve his problem. So he understands that he’s been investing in these deals as well. And it’s so relatively inexpensive to utilize that we use an active campaign, a CRM on the Jake and Gino side for the education, but we also use that as our automation and stuff.
And we utilize that for. For the investor side, that portal system is important. That is something that we struggled with early on. We didn’t have one. Crap. Now you have these hello documents, hello, doc signs. This makes it so much easier. You have all your K ones in one place. You’re able to utilize them.
You’re able to put your deals up on the platform. That’s been a game-saver for us. And like I said to you, it’s about the brand. When you bring an investor over there and you’re sending them out Excel sheets, it just doesn’t exude a lot of confidence. So think, I think that’s something where. We leveled up and helped out our brand by utilizing that.
Tim Mai: Okay. So you try to get everyone to opt in then to you, yes.
Gino Barbaro: Oh, sorry. Absolutely. Yeah. That’s the thing. When you do a podcast, you always want to have what we call a call to action. And for us, the call to action, we don’t want to invent, we don’t need any more investors.
We have plenty of investors on our website, but have a call to action, to create a little ebook. What I’ve got here, I’ll hold this little booklet up, the Grant Cardone booklets that he made five or six years ago. I got the idea. I wrote a 30-page little booklet here, on how to share the benefits of multifamily investing.
We should all have something like this. This is a business card or if you had an event, give them your little booklet. It’s you’re giving them something physical, something they can take back with them. Something where you’re adding value and it’s about your brand. Have an ebook, and be able to have an opt-in with a website.
And I don’t think websites, in the beginning, need to be that complex. You just want to have a homepage about you to show your credibility. Possibly have a one-pager, one-pager about yourself, about what you do, and what your company does. My mentor, Craig Haskell, did something called the credibility book.
It’s a 20 to 25-page business. It’s your business plan about why you’re investing in a market, and what kind of deals you have, if you don’t have deals, do case studies, there are case studies of work and what deals you’re looking for. What does your business plan look like?
Why are you in the market? And if you do have deals. Put the deals there, put the credibility of what you’ve done out there, and have that book for investors, have that book for bankers, have that book for potential partners. It’s really important to show your credibility and to outline it to them. But eventually, as I said, if you’re just handing them this book, they’re not going to look at it.
Tell them what gets past that crock brain. So they look at the book and can consume that book. That’s great.
Tim Mai: Thank you for that. And so now let’s switch to talk about the market a little bit, but where do you see the markets going and what challenges do you see when it comes to capital raising in this upcoming market?
Gino Barbaro: I don’t know if there’s gonna be that many challenges if we’re raising capital. I think the deals may be a little tight still. The pref rates, maybe eight, or nine some operators may not be able to hit those rates. And I think what we’ve seen over the last five or six years is people would buy deals.
Then after two years, they flip out. So now it’s going to be who’s operating these deals. And that’s the issue we’re going to see, you’re seeing bridge debt and self getting more expensive. So if you underwrite bridge debt, what’s going to happen in the next, 12 to 24 months, if you’ve got a refi out into higher debt, are you able to sustain that?
I think that’s going to be the challenge there. And as far as capital raises, building the brand, and getting your name out there, do people know who you are? We were in Ryan Sirhan’s office two weeks ago, and he’s right behind us. He’s going to be speaking at MM5 and to him. His brand is amazing. He sold over a billion and a half dollars of real estate last year.
It’s with the period. Yeah. When you talk to me, he’s amazing. When he talks about that, he’s you know what? Cause we have to buy right, manage right finance, and he’s you know what? Your fourth leg is brands, right? And that’s what you need to do. You need to start creating that brand and get yourself out there, get yourself known.
And I know it’s uncomfortable because if you go back to the list of our first podcast, maybe our first 20, we sucked. We were awful. And I don’t, I want to take them off. I don’t want anyone to listen to those things, but it’s humbling. And it’s also a good reminder that when you start something out, you’re not good at it and it’s okay.
And it’s funny. I went back and my kids listened to it last week and they’re like, Dad, you weren’t that good. Where are you? I’m like, Hey, am I better now? That’s the question. Am I getting better every day? That’s the question we should all be asking ourselves because if we’re not getting better, we’re getting worse.
Tim Mai: So let’s summarize, especially around branding. So if someone has a goal to make it big in this space and, let’s say. get to a billion-dollar asset under management. I’m just using it as a number here, but what are the few steps, if you can break it down in steps in terms of building this brand now to have that level of success?
Gino Barbaro: So if I had known this previously, I would have done this, but I did it later on for me. I didn’t even mention this, but when we said values-based decision-making, figure out what your values are. I think the next thing is to create the core values for your company. For us, it’s people first, make it happen, extreme ownership.
Unwavering ethics and growth mindset. That’s what our core values are. And that’s what we want to build our company around. Our mission statement is really important, to create communities that empower people to become the best version of themselves. That’s what we want. And when we’re hiring, when we’re firing, that’s what we’re basing it on all of those values.
That’s what your brand starts permeating from. And that’s what I think our brand and our company took off three or. About three years ago, we understood. And that’s why scaling up coaching was important. We understood that. And Jake came from a corporate background. He worked at Glaxo and he thought those core values were crap because there were somebody else’s core values.
But when he started his own, he wanted my core values. People first we’ll do anything we can for our community and our investors. And they’re not. Tenants, they’re residents and they’re not units, they’re apartment homes. So it’s really important to create what values you want for your company and to start living through those values.
And then ultimately, like you said, that brand, what type of investor, what’s that persona that you want investing alongside you? That’s, I think, the other important thing. And as far as branding goes to continue that branding, be consistent with the branding, pick one venue, pick one place. Cause we didn’t start with five podcasts.
We had one. And then we grew it to the next one. Then we grew it to the next one. And as you start scaling up and having those values, you start adding team members to help you with all of the other stuff. So we didn’t have a YouTube channel five years ago. We didn’t have LinkedIn five years ago, but it starts growing as you start adding more layers and more people to the team.
Tim Mai: That’s great. Thank you. And what are some, I know you mentioned cashflow portal, active campaign. What are some of your favorite tools and resources?
Gino Barbaro: For us, in the property management space, there are so many different companies out there, door loop, buildium, we use that folio. We, that was our biggest mistake, not having property management software.
We waited until we were 600 units. I call Jake, Mr. Cheapo sometimes, cause he’s looking at the bottom line and he’s not paying a dollar 50 a unit. I’m like, bro? And I think that was revolutionary for us. For us helping us out. Huge. We use a portal, a product called Kajabi. I’m looking at it right now.
Kajabi is something that we, it’s a learning management system. So if you’re a capital raiser out there, create a little micro-course, five or six videos, put it on a platform like Kajabi and send it out as a freemium. And you’re sending it out. You’re adding value to the person who you’re investing.
And that’s how we started. We started with these little micro-courses and we started creating larger-size products. So for us, Kajabi has been amazing. I had mentioned. Active campaign. And I’m going, to be honest with you. Google is great. Google Drive, Google Docs and Google Sheets have been life changing for us because it’s just open source.
We use Slack. We use Asana. We use a lot of those different other ones, but just keep it simple when you’re starting, but you need a CRM. You need a portal for investors. Important.
Tim Mai: Thank you. That’s a great list for sure. So Gina, what are you teaching your kids right now? You have six of them. What are the ages?
Gino Barbaro: 23.
Tim Mai: That’s a big range. What are you teaching them that perhaps is not being taught out there?
Gino Barbaro: So for me, it’s really weird because my daughter is 23 years old. She’s a Catholic missionary right now and she’s teaching me service and it’s amazing.
What you learn from your children, if you’re, if you allow it to, to transpire, because we’re always taught that we need to tell our kids what to do. And I learned early on that if you let them grow and you’d let them make your own decisions when they become adults, they can make those decisions.
And for her, it’s really important to grow in her faith and to serve others. And that’s what we’re all doing here as syndicators. We’re out there serving others. So she’s always got that service mindset. What I want to teach my kids is a couple of things, personal responsibility. There’s no more responsibility in this world anymore.
And those who are successful are a hundred percent responsible. The junkie’s deal goes wrong. It’s not the economy’s fault, right? It’s our fault. We underwrote it wrong. So to become personally responsible, I want my children to become responsible. And I think the other thing is that instant gratification.
My son, when he invested in our first deal, was 15 years old. He had 5, 000 bucks in the bank. I said, Mike, he wanted to buy an amp for his guitar. I said you’re not spending 40% of your net worth on an amp. You don’t need that. He had 5, 000 bucks. He put it in one of our deals. The deal’s done phenomenally.
And he’s actually, what’s amazing about it. He’s talking about creative financing. Now he’s talking about owner draws. economic occupancy, physical occupancy. He’s done some amazing things with our property management team. And that 5, 000 is transitioned into a six-figure net worth that he’s got at age 20.
But more importantly, it’s the mindset that he’s created because now when he gets money, he’s not looking to buy something. He’s a producer. He’s not a consumer. He’s dad, when’s the next deal? And Dad, can I borrow money from you? I’m like, Mike, you’re not diluting me, bro. Yeah. You use your own money, but those questions most adults don’t understand.
So in allowing them to be alongside you to be part of the journey and not have that instant gratification and delay it, that’s something that we need to teach our children. Because I always say to people, financial intelligence can change the world for the better. And if we can teach our kids, personal finance and education and responsibility, you’re going to have an amazing relationship with your kids.
Tim Mai: I love this interview. You have some amazing wisdom to share with us. I have one last question for you. And that is, what is your biggest goal or passion that you want to achieve now at this time in your life?
Gino Barbaro: I’d love to have more kids, but that’s not only up to me. It’s up to the wife.
So that goal is pretty much kaput. But maybe adopting. I don’t know. I don’t, it’s a hard question to answer because I live every day. I feel as if I’m playing with house money right now. I don’t have any goals or aspirations. The only thing I’d say is one of my hag’s big hair.
They should use goals to have 10, 000 people leave their jobs by the year 2030 through Jake and Gino. That’s a really big goal for me. And Hey, we’re eight years out. We’ve got about 70 students who have left their W2, so I’ve got a lot of work to do. So if I’m able to do that, can you imagine the wealth that I’ve created and the community that I’ve created?
And Hey, by the way, some of those students may partner with us. You never know. So just creating that impact for others. And it’s so much fun, Tim, to get an email from somebody saying, Hey, I left my job or Hey. Hey. Hey. I just raised a million bucks with this deal or, Hey, you change my life. You change my mindset.
Even if they don’t do a deal for the next year, just changing a person’s mindset and the way they look at things in life is just inspiring to me. So I, once you’re playing with house money, you sometimes don’t think that far ahead, but maybe I should, but it’s been a great ride for the last few years. I have no complaints.
Tim Mai: I love it. I love it. Yeah. Your goal of retiring people is amazing. The difference that you make out there. Yeah. And I love watching, all the things that you do and everyone who I have heard talk about you. Has taught wonderful stuff. I’ve never heard one single negative thing about you.
So it means a lot, right? The impact that you’re out there making is huge. And so thank you so much for all that you do and the difference that you make out there.
Gino Barbaro: And thank you for doing this interview with us. I guess the only last thing I would say is I’m trying to. Elevate the education space because most of the people out there, when they hear gurus and you hear it’s negative, it’s not good.
And all of us need that at some point in our lives. But if you have the mindset of, Oh, this, he’s a guru and he’s out there just trying to sell education. I don’t want that. I want all the educators out there to be mindful of what we’re doing and what we’re putting out there because. People need this education.
People need camaraderie. They need the community. They need networking. And if they do, their first inclination is to say, these people are just out there trying to scam us. That’s not a good feeling. So having that means a lot to me, not having any negative reviews, and having a great community means a lot to me, that’s what I’m working and striving towards.
Tim Mai: That’s awesome. And you’re there.
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