Welcome And Why Doug Matters

SPEAKER_04 0:27

Hey everybody, Ryan Garland here, founder and chairman of Paradigm. Thank you for watching and joining us today. I think you guys are going to be excited about this one. So we have Doug McAllister here, and Doug is my former president, used to be a mayor, and uh he helped me really launch Paradigm's Platform. So I figured what we'd do is kind of share a little backstory about him and I and how we connected and the relationship we have today and how much of a fight it was getting into this. But I wanted to just kind of let my audience know where we came from and the relationships that were established and why it's so fruitful and valuable today. So, Doug, thanks for joining us today.

SPEAKER_00 0:59

Hey, it it's it's awesome, Ryan. Um, you know, uh doing anything with you is an experience.

SPEAKER_03 1:04

And um our audience should read into that a little bit.

SPEAKER_00 1:08

I'm looking forward, I'm looking forward to this. It's um I'm I imagine that we have a perspectives as far as the early days um that I hope um will help allow folks who are looking are either already involved with our company or are are looking to or considering that, get a feel for where it came from. What are the roots and um some of the some of the fun stuff and some of the hardships and things we had to go through to to get to where you are today, which by the way, pretty impressive, dude.

SPEAKER_04 1:36

Well, thank you. It's but I couldn't have done it without you. Yeah. You helped me launch the platform when we really started to just migrate into mass solicitation. So this has been it's been a hell of a ride. Yeah, you know, and I know you've been there all the way through, and I really do appreciate all the support because it really can't do it without a warrior by your side, you know. And you know, let's talk a little bit about kind of what you're doing today, and then we'll kind of back into the relationship and kind of all the fun stuff we did uh you know when we were together.

SPEAKER_00 1:58

Yeah, I'm um I'm primarily focused right now on telecommunications. Um I'm vice president of a large telecommunication company. And so my my jurisdiction basically is 12 states, which means I'm tired all the time. I I I'm on either end of the car or on a plane and such. And so the opportunity to be here today is because it's a business out this way. Um and so it's that's primarily what I'm focused on at this point, other than my grandkids. That I should put them first, actually. Um, but we're

The Email List That Changed Growth

SPEAKER_00 2:25

just loving having those those those little guys and gals walking around and um and they don't by the way, they do love their grandpa.

SPEAKER_04 2:32

I believe they do. That's awesome. Good. Yeah, and I you know, I love when you hit me up and go, hey, I'm gonna be passing through. Let's go have a podcast. Love it. So let's talk about uh, you know, when we really expanded paradigm. I mean, back in 2000, uh shoot, it's always been a dream of mine. Back in 2014, we really started utilizing like uh emails to start building awareness for our investments. And that's when I started really doing a lot of debt on you know, homes in Beverly Hills and Bel Air and a lot of the higher-end homes. And and you know, a lot of people that don't know how commercial real estate gets or even you know, real estate where there's zeros behind it, when you start doing development, you do need to uh kind of tailor your capital stack around uh being successful and raising the money. So most of the time, when you start getting to you know five, six, ten million dollar deals, you need to have debt and you need to have equity. And uh, and there was a gentleman that was really big in email marketing. And uh and I didn't know it at first. He was actually kind of quick backstory. He ended up coming to me for a construction financing for a property up in Sacramento. And uh he was looking for liquidity, and I kept telling him, hey, you need more money down, you know, and it was a big deal. It was like five million bucks. And so he's I said, Hey, you need at least 30% down, you know, the loan to value needs to be around 70%. So he uh he started trying to negotiate with me to buy stuff from him to get the liquidity. I'm like, listen, what's the problem? He's like, Well, I just don't have the money, but I do have all these lists of potential investors. And what it was is that he had managed and started, so when LinkedIn became real big in the very in the beginning, whoever managed a group on LinkedIn, you would, you know, let's say it's a real estate investment group as an example, whatever group it is, you would be able, if you were managing the group, you would be able to get access to all the emails that that all of the members had. No, you can't do that anymore. But what he was doing is he was extracting all those emails and putting them into a separate CRM, and then he would do mass emails. And this is when it all first became big on, you know, mass solicitation to build awareness for his investments. And he had kind of melked his network, and so he knew he wasn't able to really get more out of his network. So he's trying to sell me the list. Well, come to find out, he had the first, second, third, fourth, and fifth largest real estate LinkedIn investment groups in the world. And uh, and so he comes to me and goes, Hey, I'll sell you one of these for like $60,000. And I back in the day, I was like, Are you out of your mind? Yeah, you know, I was like, I would never spend $60,000 for an email list, right? I didn't know no, I had no idea how powerful it was. So he calls me in a couple days later and goes, Look, I really want to close on this deal. He goes, I'll work a deal with you. How about I use your guys' offering for one of your projects? I'll it's under you. You check with your securities attorney that you can do the solicitation in this manner. You I'll do all the management of the ads and I'll push it for you. And if you raise a couple million bucks, you pay me $60,000 for it. And I'm like, well, that's my commission, no problem. You know, because if you could do it once, you probably do it four or five times. So he launches this ad. And we, I remember we worked all week on it, launched this ad on Friday. By Monday, we raised a million and a half. And that was like opened up my eyes because now we closed on a deal, made good money. Now we're branding ourselves into higher dollar amount deals. And that's when we're like, okay, we're gonna we're gonna go ahead and expand the company all the way, all the way, you know,

First Meeting And Early Platform Grind

SPEAKER_04 5:45

to where it is today. You know, that was always been the vision. And uh, and that's when I came across to you at the same time.

SPEAKER_00 5:52

I think I think we need to tell the folks what that looked like. Okay. Okay, it was uh we were um introduced by a gentleman, um, and I frankly don't remember why. I just remember he wanted me to meet you. And um he and um well we'll leave him anonymous at this point. Uh but um all I remember was we were at this this restaurant, this deli type restaurant there in in um Temecula, California. And um I'm sitting there and then walks in this behemoth of a guy. He's like you walk in there going, so I'm starting to sit up straighter and flex my arm, whatever I had to do, because I was somewhat intimidated. And um and stuff, but we ended up in a conversation that just kind of kept going. And um the that led to me, you know, you invite me over to the the office there in Temecula and um kind of taking a tour, which led to us having a relationship there. Yeah, and um but it was even then I I could tell. Um I th I accepted going to visit the office because in our conversation at the restaurant, I said, okay, there's something going on here, something that I need to look into. And it was not my intention. I mean, I my consulting services and everything else, I was fine. Um and so we went over there and you you showed me around this incredible office space and stuff, met a couple of the folks who were working there, and um eventually that led to us working together and such. Um, but it was it was for me, it was like drinking water out of a fire hose, learning. I mean, I'm I'm a telecommunications guy, um, learning the the um the even the lingo and stuff, but everything you just said about um those early days and those lists and everything, it was a couple of things that struck me. One was um igniting my PTSD, but that's a whole other discussion.

SPEAKER_04 7:49

Um the hard work it was in late nights, hopefully.

SPEAKER_00 7:52

Well, yeah, but just learning all of that, I understood every word. Yeah, uh there was a day I didn't. Um but just remembering the underwriting, remembering looking at the numbers, remember trying to suss out whether or not that sponsor was worthy of working with us, and vice versa. And um it's it's just all the high stakes that came down to we had to do it right. Because we had people counting on us, people were were giving them us, investing the us their with their money. And it so you always had that pressure to see to it that as we were going through it, we had to do it right. And so through the process of that for me, I was you know, I'm learning, but I'm also watching. And as I'm watching this thing, I'm going, you know, how how you to conduct yourself and and and stuff, and that freakingly, freakishly big heart of yours and and such, and and your desire to make sure that the investors are taken care of and and all that going on, I'm going that's that's unusual. I mean, I I deal politics.

SPEAKER_04 9:00

I was just about to go into the you being a mayor here.

SPEAKER_00 9:02

Just the people that I dealt with who are almost well, 13, 15, whatever how long it was behind the dais there. I I deal with those folks, and I can tell you some really dark stories about you know where currently two of my former colleagues are now convicted felons. It was super, super ugly. Yeah. And um such. And during those times, and seeing and but juxtaposing that to the integrity I was watching with you, um it just was something for me to watch. And and I did. I it was

Integrity, Investor Trust, And Personal Loss

SPEAKER_00 9:35

because that was important to me. It's also why I invested all those years ago. Um I it was it was a time when the company needed more investors to keep things going. Those early years making payroll, making all this that was hard. Yeah, it was definitely hard. So but it was why I it's why I invested because I felt like okay, if I put my name with some guy who takes this much effort to take care of of the investors, um I I can do that. But there was another reason why I invested with you. Um the my my eldest son, um Brian, um passed away when he was 21. And and so I I would watch you and I it wasn't making the connection, but I would watch you at that point and say, I was like, if my son had lived, I would like to think he would have been like Ryan. And then one day I realized, okay, it's Ryan with a Y, and it was a Brian with a Y. So they had that connection as well. And so I didn't invest in the company. I think I've told you this before. I invested in you. Um you were the you were the key to that. And um and to this day, to this day, I I I know you'll do me right and such. I I didn't invest in a project, I didn't invested, I invested in you.

SPEAKER_02 10:58

Yeah.

SPEAKER_00 10:58

And so at this point, um, you know, I'm watching what you're doing. Holy cow. Holy cow. I had not been to this facility yet, and everything else. And but talking about the projects, I think uh walking in my construction site, their project meeting today. Well, that was even yesterday when we first sat down, when I got here and such, and then you started going, going, going, going, going, going all through the uh it's like, I remember that guy. Funny. So, you know, there's a lot of that, a lot of good memories.

SPEAKER_04 11:29

Well, I'll go back, and that that actually means a lot. I didn't know if we're gonna talk about that on the podcast, just FYI. And that means a lot because I really want my audience to know kind of you know where I've been and where I'm going, you know, I think is really important because I think some people see if they're just now getting to know paradigm as a brand or just us or me or what have you, or anybody with my company, they don't realize how much it took for us to get here.

SPEAKER_03 11:48

Yeah.

SPEAKER_04 11:48

You know, a lot of sacrifice personally, you know. Um, and when the market shifts, everybody that's a part of the platform worries, right? I mean, uh just think about it right now, everyone's worried about what's going on in the world. So naturally, if you have a bunch of money out, you're gonna be concerned, you know, you're gonna lose it, especially baby boomers, because those are the majority of our investors, and and they've already been through 2008, they've already been diagnosed with cancer, we they've already, you know, they've had you know loved ones die. You know, we're getting, you know, I think people misunderstand, you know, the this is a relationship business. And what I mean by that is, you know, when you when you, yes, you meet somebody and they invest, and you know, everything could be completely institutional, right? Just matter of fact, look at the documents, like the investment, make the investment. But when things get real tough for them, they're gonna start calling and just making sure things are okay, or hey, I, you know, I I got diagnosed with cancer, I just opened up a trust and I need to. So now that creates a different connection to those people. And um, and uh, you remember how we wanted, remember we were this was back in the day, we started emailing all of our investors and we wanted all of them to send us pictures of their families, and then we would put those pictures up onto just outside the elevator when people come into our office as far as our employees, and I'd say, you weren't just working for paradigm, you're working for all of these people. And we'd have just tons of pictures of of family members that were, you know, invested and trusted into us. And that's different because I I always try to instill that, you know, what gives you purpose is taking on responsibility, you know, not just chasing, you know, money for you and your own family. When you take on other responsibility, it really gives you just a different connection to the world. And uh I'm sorry I went on a little bit of a tangent here, but I think that's what had happened is I just I really settled in because after I got through raising some money for some projects and going through some cycles, I realized how much these investors really rely on us to perform. And and everybody has a story. And then when you get a few phone calls, we've been doing this what going 15 years now. You start you're getting phone calls from people that say, I just lost my son, which you just shared with the loss of your son. You just it's it's hard to, it's just you you kind of go through the emotions with them. So you you have a lot of those moments, you know. And I it's funny, I've never said this, and I wanted to share this with somebody, and that you're gonna be the best one to share this with. My mother, when I reconnect with my mother, my mother in 2017. So a lot of people don't know this, but my mom left when I was six months old, right? You know this.

SPEAKER_03 14:07

I do, yeah.

SPEAKER_04 14:08

But my for my audience, and I found her in 2017, and I was going through this kind of forgiveness component of my life, and I was just really settling in, I think. And uh, and I found her and we reconnected, and now we have a great relationship.

Running A Firm Like Stewardship

SPEAKER_04 14:20

But when I when I reconnected with my mother, what I was I learned of about her was that she shared a lot of late moments for with people, meaning, you know, she was a house cleaner, and so she's had always kind of hustled a little bit. And so she started working and clean houses for ladies that all of her, you know, their family maybe doesn't want to see them anymore, their husbands passed away. And so these are women that are like in wheelchairs, right? So she ended up becoming really close to them. And she ended up becoming best friends in some cases, and then, you know, some of them would pass away and she would be right there next to their side, and she did that several times. So she started kind of becoming, you know, this um hand for people on their last moments of life. And so when I reconnected with my mother, not only was my mother so thankful and we reconnected, and you can only imagine that reconnecting with your child and all that. And so that connection I had my mom, but my mom had a sense of humility and connection that she would share these stories in a manner. I would I just really settled in to the relationship-building component to the way the world should be. And I think that connection is what's allowing me to keep going too for a lot of people that I know, you know, because I have friends and family that have all invested, or, you know, people that become like family that have invested. And so I wake up every morning not to fight for me, I fight for a lot of other people, but it is a different experience to feel that. And um, and I think that's what you and I really shared because as we were growing the company, we had a lot of those conversations with people. And uh, and it was hard. It's a really, really, really hard, you know. But I kind of feel like that's that was the that was the door that was opened, and I walked through it, and that's kind of my calling is to continue to fight, you know.

SPEAKER_00 15:59

And when some of the hardest things I think are both of us in those early years. Um you're all you're always looking for help. You're looking for folks to come in and help carry the torch. Um, whether it's, you know, they're in in in the working with the investor relations or or whatever, you know, on on either side of the house, you know, whether it's the debt stuff. You always look for those folks. Unfortunately, the nature of of our business, you know, is is money. And um not everyone comes with pure motives. And watching, you know, when when you and I had this this uh ethic of this is about the investors. And so everything we do needs to be stellar to protect their interests. It's um you know how we spend the money, how we whatever. This is always about the investors. And watching that not be the priority sometimes and stuff. And so now we're dealing with the drama of the inside of seeing to it that we're able to fix that.

SPEAKER_04 17:07

It's biblical.

SPEAKER_00 17:08

Yes, very much so. Very much so. And and so I will say at this point, I know I've I've I've I've met m several of the folks, none of which were hired on my watch. I don't think. I think maybe Joe was. I don't know. Um Joe's still here. Yeah. Yeah. Um we say most of them worked and such. But the quality of people around you now, um, I'm taking from uh businessman's point of view. When I'm looking for for folks who who are understanding that their job is to make you successful, which permeates into all of our jobs is to make the investor successful and stuff. And so if that's becomes the focus, then that happens, but they also benefit. There's a residual there that other folks would try to go for that first. It's all about me. Oh, and the investors get something out of it, too, that's great. And and so you know, I come with a perspective of watching over the years. Watching over the years, how and things were developed and what we did right, what we did wrong, and what we did to p to pivot when when we discovered something that was wrong, we get it fixed and and stuff. And there's uh probably more than one story we can't tell um about those times.

SPEAKER_04 18:29

Um people we fired at the end.

SPEAKER_00 18:31

Yeah. You said it not me. Um and um but but it's it's gratifying to see because why I'm looking at with this facility I'm sitting in right now and such, this didn't happen without the support of some good people. Um and the the projects that you have on uh on the platform at this point, um, some of the new ones that may be coming along and stuff, you know, I I am really thrilled with. I know you and I talked over in the early years, all the sponsors would come to us and they want us to fund their projects. So we we tried to find the good sponsors and the good projects and and fund those. And in most cases we did. Um but we always say, Well, what if we just did our own? What if we just did our own at that point? And that takes that that question mark out of the out of the equation, um, because we know we're gonna be diligent to do that, and that's exactly what you're doing.

SPEAKER_04 19:27

You just underwrite the asset instead of the borrowers' performance and the asset. So you can eliminate one big component for underwriting.

SPEAKER_00 19:32

Which is a huge question. Oh, yeah. Uh, even if you get their resumes and bios and everything else and stuff, those aren't always too accurate. And so moving into, you know, removing the unknowns from the underwriting, um, and moving into what we do know, um, I think it I think is is brilliant.

SPEAKER_04 19:54

I found a picture the other day. I'm gonna pull it up right now.

SPEAKER_00 19:57

Oh my.

SPEAKER_04 19:58

But I remember when we really started, because remember when we were doing a lot of marketing, we were getting what, five, six, seven, eight submissions a day for a new deal. And uh, and I remember you were kind of tasked to underwrite all those deals.

SPEAKER_00 20:12

Yeah, I remember that too.

SPEAKER_04 20:13

You did a lot of you underwrote a lot of deal. A lot of deal.

SPEAKER_00 20:16

Like I say, PTSD kits.

SPEAKER_04 20:18

Oh, yeah, a lot. And then we knew and then we would you'd present, you know, a handful of them to me, and then we'd dig in and we're like, nope, nope, nope.

SPEAKER_00 20:24

Yep.

SPEAKER_04 20:24

But man, we we were at a point that we were actually one of the fastest growing platforms in the country. And I think not a lot of people know what that takes. And you know, like uh back in the day, I think Realty Shares was still around. They had a burn rate of a million a month, but they did, I think, like $700 million. Crowd Street, I think, is at like four or five billion now. But they got bought out by um Juniper Square. Oh, did they? Yeah, Juniper Square bottom out, which we use them as a software for uh investor tracking, reporting, and all that fun stuff. Yeah. So, but when that was a to migrate over to that was was hard. And then when they merged, just like any you know, private equity firm or any type of big advisory CPA firm doing a big merger like that was incredible. But they've had A, B, C, and D rounds. I mean, and these are 20 million, 30 million, 40 million, 90 million dollar rounds. You're

Building Teams And Shifting To Self-Operate

SPEAKER_04 21:10

like, oh my goodness gracious. It was uh it was it's a lot, but it was fun to watch. The only thing that derailed us was the pandemic.

SPEAKER_00 21:18

Yeah. Oh wow.

SPEAKER_04 21:19

We were on track. It was, you know, I feel like Al Bundy talking about, you know, four touch and touchdowns in a single game, like we were gonna be somebody, but man, it was we had to pivot, we had to move, you know, we moved out of state basically, because it just California was really difficult to run and operate now the businesses. But you know, we were we were on track. We had a great, we had our platform, we we fought to get that platform to where it was.

SPEAKER_00 21:40

Well, that was when um I um moved out uh out of the company as officially. I mean, I'm still around, but um primarily because we you know you moved to Tennessee, which was I love Tennessee. I do. But if I moved there, I would miss my wife. She doesn't like the call. She didn't want to go back to humidity and that kind of stuff as well. And so it it was just better for me to have more of an advisory role than anything else. And since that point, you brought in some folks, your your your CEO and others that that uh frankly when it when it comes to this industry are a whole lot better than me on that. And it's it's nice to see that as well. Um So you're not dealing with having to train them up, although I'm sure you do anyway. Um but it's it's a matter of having good people around you.

SPEAKER_04 22:28

There's always a learning curve.

SPEAKER_00 22:29

I'm a little scared about this picture.

SPEAKER_04 22:30

No, no, it's a good picture. I'm actually still trying to find it. But it was um it remember when we were doing a big company photo and we were all messing up on our smiles and all that fun stuff. I just saw it the other day something finding the right picture. Yeah, and then I was like, all right, everyone just do a serious smile, and we all just hit it right at the one one time, and that became like the final photo for us. I just saw it. I'm trying to find it right now, but that was uh that was a really cool shot. It literally, I just posted it the other day too.

SPEAKER_00 22:56

Yeah, that I I remember doing that, and then that's probably a good example of then and now.

SPEAKER_04 23:02

Yeah.

SPEAKER_00 23:03

Because I think you're doing more with less.

SPEAKER_04 23:05

Yeah, for sure. You know, but you you know, technology AI systems, you know, it's gotten Juniper Square was huge. We got rid of three people just in bookkeeping. You know, we do outsource a lot of that type of stuff too, because we, you know, we do um we get certain uh funds will get audited financials. So you kind of want to stay on top of your bookkeeping with with a like in-house CPA that will eventually do your audit once a year, but you want to make sure that everything's allocated properly. So we do that once a month. So we we there's maybe it I would say because we've grown, there's it's more operational work, but we have really sophisticated third parties, if that makes any sense.

SPEAKER_00 23:39

It does. Yeah, it does. I I am um I know I don't be oh, I don't get over here that often and such. If I have business in the air, I'm gonna want to drop in and see you, but but oh that's the picture.

SPEAKER_04 23:52

What a killer shot, huh? Joe, I'm gonna send this to you so you can edit it in here.

SPEAKER_00 23:56

That that is That's a great shot. Some of us are pretty good looking.

SPEAKER_04 24:00

I know. I didn't have as much gray hair then, I'll tell you that. I don't even think I had any gray hair back then.

SPEAKER_00 24:04

You didn't back then.

SPEAKER_04 24:05

But that was our 8,000 square foot Google Hangout office, man. That office was awesome. I mean, dude, everyone who came into that office was like, that is killer. But I mean, that was great because we'd have all our events there and we do all of our stuff there. That was pretty cool.

SPEAKER_00 24:16

Yeah. And just and just I mean, in those days as well, is having that office, bringing the folks in, um, and stuff. We made a lot of friends. And so to this day, I uh investors that are invested in the early days on projects and things, um, you know, were bring where they're still around and such. And so it's there's a um uh I think Milton Friedman is his name. And um he wrote a book that I for the lack of me I cannot remember the the title at this point. What was it about? Well, the book he was he was basically Ronald Reagan's uh finance guy, um economy guy. And there was this one section that is a quadrant. And it's I I've got uh I'm gonna try to explain this, but there's you know, basically you've got four quadrants, and then it's you and someone else over here, and then it's how you know how you spend money, how you spend your money, how you spend someone else's money, how someone else spends your money, how someone else spends someone else's money. And I came across this when I was in government, and I had I made everyone hang this on their wall either in every office in City Hall. Um because typically, for instance, it's not in all cases, but in in many cases, it seems like, for instance, government will spend money. It's someone else spending someone else's money, which is doesn't matter. Okay, that that that permit is uh thirty thousand dollars. That's too much. Well, that's not my problem. You know, I gotta write the check and stuff, and so it increases costs of everything and such. Well, you when you come into a private equity firm and it's all about someone else's money, and you're the one spending it and such, there is this this visual, this optic that needs to be considered when it comes to that. And so you've got that going, and and plus I think some ethics come into play here, um, where uh the real temptation is to take that money and okay, they they want this is what happens too many times. They they invest here, but you put it over here. And you see the news stories about that every day

Underwriting Discipline And Distressed Mindset

SPEAKER_00 26:20

going on. And so the key here is that you spend someone else's money as if it were your own. How would you spend your money? Well, you're gonna try to save. You're gonna try to make it try to make it, you know, more bang for your buck. You're gonna try to look for deals, you're gonna try to make sure that it's secure, all that kind of stuff. You doing that for my money.

SPEAKER_04 26:40

You know, it's uh it was really pretty, it was kind of cool. Someone asked me about this the other day. They said, How did you like kind of get into the business and how are you able to like manage it? And I said, you know, when you do, I think I really the big advantage for me was the fact that I did a lot of loans and then we managed a debt fund. And I think what happened was is everything is so processed, right? It's such a process that it just becomes like your business. Like it's just everything's a process. So when you when you like, for example, if I'm gonna fund a construction loan, we are gonna look at the budget with the with the builder, developer, borrower, and we're gonna go, okay, what is all of these line items for? Hey, by the way, you're missing, I'm using that as an example, you're missing like your landscape. You don't have landscape in your budget, right? So you're like constantly correcting other people because you don't want to short fund them, you know, and then you're going, hey, where what about your plumbing? You're whole you have no line item in your budget for plumbing, right? We know that's a you got to have that in there. And then a lot of times, if that's not done and you had if you gave me a budget, then when I fund that loan, you are going to have to stick to that budget. You have a contingency and I'll make some concessions, but it's got to be justified. So I think I got to a point where you just when you fund something, you have the money allocated for that, and you have to do everything you can, do the best you can to try to make sure that you fit with inside that guideline. So it was really just processes. And when I've done, dude, I've done, I don't even know how many, I was doing 300 loans a year. You know, I mean, it's a lot. And it was ground-up construction. This isn't just you know, short-term bridge loans, these are rehabs and construction loans. So there's every every loan was a lot more involved in underwriting, you know. Entitlements, planning.

SPEAKER_00 28:16

I mean, to me, underwriting is another definition of underwriting. What you just described is it's one thing for someone to invest in in a in the company, and then you spend that money as if you would spend your money, meaning you want to do all the good stuff with it and such. What you just described, I had never thought about before, which is the underwriting side of things for those loans is making sure that those people who are getting those loans spend your money the way it should be spending that money. And when they don't, we you have recourse at that point. So yeah, I never thought of it that way, but that's exactly what was going on.

SPEAKER_04 28:57

And I foreclose and take properties back and things are so I'm so used to that kind of distressed asset. And honestly, I think a lot of my conversations I have with people, I think it's just relevant in the market, just given the volatility, is you know, we have a background in distressed assets. I mean, if you look at it, even yes, I really built my relationships and my my core business in 2008 during the crash. But when you look at the fund that we manage, we're still funding loans and foreclosing. No matter how good the market is, you still have those situations because the majority of the risky loans are always ground up construction. That's where all the risk is, you know, as far as any type of mortgage-backed security. Ground-up construction, it's a problem. That's why in 2022, when the rates started spiking, all the note buyers that were around basically faded away. I mean, you we couldn't fund loans and sell notes for the life of us. And uh, and a lot of our, if you recall, I'm kind of going a little off subject, but if you recall, our biggest note buyer was actually out of Israel. And that's when all that stuff kind of started happening in Israel. So, you know, at the end of the day, you can only, you know, you can only you can't you can only have so much liquidity. And then when you when you are unable to turn your paper, then you have to really pay attention to what loans you're putting your money out on. So, you know, you you when you have kind of a distressed market or mindset, then everything is kind of looking at things worst case scenario. So, like, you know, I think where our our bread and butter is right now as a firm is the majority of our assets don't have any debt. You know, for us as an operator, when we're talking to investors, we're going, listen, you know, where the majority of risk is is the volatility, the uncertainty. And then if we go get a big construction loan, you know, what if the market falls out or what if inflation goes up higher? What if the cost of steel goes up, you know, 25%? Well, that means that when we funded the loan, like if I were to do it, I don't have the ability to go get more money after I funded it. So if inflation continues to have a negative impact and things are to continue to go up in cost, then I don't now have enough money from day one when I funded it to finish the project. That's a problem. Where am I going to get it? Call my investors and get a capital call. So we were like, why don't we try to eliminate that? Because a lot of investors they don't have extra 25, 30% for a capital call. Excuse me, especially when the market's starting to get bad, people are starting to, you know, live on a budget because cost of living's going up, right? So you can't just call people and go, hey, I do have any extra money, let's throw it in the pot. And it's not like these are like little zeros, these are big zeros behind these deals.

Reducing Risk With Phased Cash Projects

SPEAKER_04 31:20

So we looked at it and said, well, why don't we do this? Um, and there's other factors, right? Like labor force and approval processes and all this stuff. We looked at it and said, well, why don't we just start doing these things in phases? So we go to investors and we went to a core group, right? And we said, Hey, what matters more to you? Less risk, uh, you know, less risk in the investment, but longer time frames, right? Instead of, you know, getting your money back in two and a half years, four years, because we just have to do more phases. So we don't have to raise as much money, but we're gonna do it in cash. Would you rather do less risk, less returns, and longer timelines? Or would you rather maximize your returns, take more risk, and you know, shorten your timelines? And they all said, I would rather mitigate risk, lower risk, longer timelines, not as much money in returns, hence the way we're structured. So, you know, you for us to be successful, we have to make we have to make adjustments to our offerings based on what money wants to do, you know. But at the same time, you got to be as conservative as possible because it is a very unique market to navigate. So we look at it and go, well, yeah, it's gonna take us longer to do it, but it's way smarter to do it that way.

SPEAKER_00 32:24

We um and as you're talking about stuff like that, um, two things have to mind for me. One is the value of real estate investment. Um but the what the first thing I want to discuss is is the question is why is experience so valuable? The answer is it's because it costs so stinking much. And so the the idea here is that everything you're talking about is not theory. I remember watching you go through the evolution of where where we started when I first encountered you and through all those processes. Um the the it was the gathering of experience and such. Well, that didn't work, let's not do that again. Oh, that works great, let's do that a lot more. Um, and whether it came to employees, whether it came to the everything you just said as far as doing the business. And and so if we do that right, and this is always a thing in the early days, especially because we're trying to make sure we do it right. If we do that right, the underwriting is solid and everything. Obviously, you can't see the future, but you know, you we go through and see as much as you can see. And I in my view, I think we saw more than most how we did things, um, and such. I don't know that there's a more s risk less risky, I I had to care how I say this, investment than real estate.

SPEAKER_04 33:47

Yeah.

SPEAKER_00 33:48

Um, I mean, obviously things change, economies change, you we have good, you know, whatever and such. But this is paradigm.

SPEAKER_04 33:57

Well, you know, shift. It's yeah, that and that's been nice to be nimble too. I mean that's why, you know, I named the company paradigm back in, I think we opened up the first corp in like 09 because that was when the market was shifting. You were having to pivot to survive, man. That was just more of a survival kind of naming the business. But it really kind of has and it's been something I've I brought it up to my team today. Hey guys, you got to pivot. This is what's going on in the market. Or, you know, we don't know if you know this is gonna get handled with Iran, you know, fuel prices are gonna stay high for a little bit. That's just you know, plan for the worst, hope for the best. So, you know, I think, I think you it always comes down to, and it's funny because remember, my uncle was one of the owners of Standard Pacific, right? He went and left and did uh he was the president of construction, did high rises, and you know, so it's it's the same, same story. You work with very sophisticated operators, they're gonna tell you it's always in the buy. It's all about where you're buying and what price you bought at, right? And planning, that's where all your risk is, is typically in planning. If you can plan right, get out of the hole right, you buy right, you're usually gonna do okay. You know, and all those, there's also it's just standard practices, and I think a lot of people don't understand that the reason why deals go bad is because you're over-leveraged or you didn't plan for your budget right, or those type of things. That's when you people get into uh pinches.

SPEAKER_00 35:09

Me, um one of my one of my not pet peefs, I can't, but areas of expertise, let's put it that way, is it that I watch so many folks fall through on was government. It's that you know, when you're trying to understand and deal with the whole issue of of what it's gonna cost to get your approvals, you know, and the process of getting your approvals. And the answer is, oh, I know a guy, I know the council member, I know, I know whatever else. And so everything hinges. We just had one of the projects that we're both glad we're we're done with. Um that was what was said. Oh, I have a I have a council member who's gonna support us to get X, Y, and Z and everything else. And and it did not come true. And I will sit here and tell you that 99.9% of the time, it does not come true. And such, and so understanding one of my questions always was, and we've had a couple of folks that we sit on calls who were trying to pitch us on deals, and I just got I was trying to be nice about it, but I wanted answers to how are you dealing with the government on this, and they don't have the answer to that. Trevor Burrus, Jr.

SPEAKER_04 36:20

Well, they don't know who your background is, so you're gonna ask questions they should have answers to them.

SPEAKER_00 36:26

That's one of the things that I think most real estate firms miss out on. Um and it's it because there's two things. There's the one method where you as as a as a business, you're trying to co-opt the decision makers. And so you're busy with you know, working with the chambers of commerces and the economic development corporations and and all of the other um nonprofits that are influential in the area. And so that when you want something from government, you sick all those people on them. I will tell you, as one who was the mayor of a city, I hated that. Yeah I hated that and intended to sour me on a project and such. The other option, which is how I

Government Approvals And Real Relationships

SPEAKER_00 37:10

built my entire career at this point, is um relationships that were real. So we have these relationships with all these decision makers across 12 states um that when you know they already know that I have proved myself to them and they trust me. And so I can what I call um anticipate and mitigate hurdles with that. And when we injected that into what we do and such, and expect our sponsors and even our contractors and everybody else to understand that it's more than who you know. You know, it's got to have a relationship there that whether at least give you a hearing. I don't expect them to always agree with me, but I you know they'll let my foot come in the door. That aspect of a project, I'm looking here and here where we are sitting in Havasu, um, or there's Nashville or anywhere else, that aspect of a project will make or break it because it's true. They will. I mean, just the the fees for permits alone. Oh yeah, here's yeah, write a check for $30,000. I've heard that many many times. Well that for for this, I mean I've seen I've seen permit fees in the hundreds of thousands of dollars. And so trying to discuss why is it that there's places in LA right now that I believe it's if you're if for telecommunications, if you're boring under the ground, it's like like a thousand dollars a foot. Just in permit fees for the year. Just in permit fees. Yeah. And um I I may be misrepresenting that actual number, but it's a ridiculous number. Um and so and the the law says you can't make money on these things. You have to it has to be a break-even at this point. Well, people at the front counter are being just doing what it says in the book. So if you have a relationship with their bosses, they're typically you can talk some sense into them. And they go, Oh, wow, I didn't realize, okay, no, we're gonna waive that and whatever else. And so those those aspects of working with government are huge. And um and that I I'm I I probably beat that that horse to death, but from the standpoint of what paradigm does is that I've watched I've watched you get a whole lot more sophisticated about about that than when I found you. And um so and I and I I have to believe that uh a large part, or at least a good portion, of your success is because you played that game right.

SPEAKER_04 39:42

Well, you know, it's uh I think what it comes down to, and I agree. No, you you nailed it right on the head. And I learned a lot about, you know, what you were you were a my mayor of one of the fastest growing cities in in California, you know, and that and I was part of it. I grew up there, you know.

SPEAKER_00 39:56

Well, hold your thought. Let me sure everybody knows. When I first got elected, we had around 30,000 people in the city, when um about four to five years later it was over a hundred thousand. So it was exploded. Super fast growing.

SPEAKER_04 40:08

Yeah, that was Riverside County.

SPEAKER_00 40:10

Yeah.

SPEAKER_04 40:10

And um, you know, that was it was it was very interesting to hear a lot of your story. So I did a look at a lot of two ears and one mouth when you were around, especially when you were talking about your past. And I can tell that there was a lot of influence with developers. Look at Dan Stevenson. I mean, he was the he is the guy in Southwest Riverside County and billions in dollars. And uh, and you know, he has such great relationships with everybody, and then he tries to give back too, you know, and whatever is impactful, positive, nonprofits trying to help. And it you really do have to do that song and dance. But one of the things I loved about Dan is he did it with such an open heart. Yeah he loved to do it, and I think that was why he was so successful because people f saw how genuine he really was to do it.

SPEAKER_00 40:53

He loved it. I could tell you stories I where I'm sitting in talking in the city hall, talking to a developer and getting yelled at and screamed at and such. I I I can tell you stories about being in public events and having developers rubbishing us in public and such. And I and then I can tell you stories about the Dan Stevensons of the world who just said, let's talk about it. Yeah and stuff, and we'll keep it and we'll keep it private and and such. And I can tell you that that was a better approach. Oh, yeah. That was a much better approach when it came to you didn't always get everything they want, but I always call it, I called it find a way to yes. What's gonna work so that I'm gonna spend your money as if it I was spending my money, you know, I'm the one paying for the permit, such. But I still got to cover these these three things because of law. And so let's find a way to yes. And um, going that extra

Europa Village And The Pivot Playbook

SPEAKER_00 41:50

step is I believe part of the success of what I believe is the a very solid investment uh genre, which is real estate. Um, but if you're in real estate, you've got you've got to understand how to do that.

SPEAKER_04 42:04

Especially with government. You know, the um not a lot of people know this, but we were a big part of the capital raising uh process for Europa Village. Yeah, you know, a lot of people don't know that. I've always kind of kept it tight because I was like, yeah, it's not that big of a deal. But uh, but it has actually gotten a big deal, especially when I just went back over there and I'm like, gosh, this place is slaying it.

SPEAKER_02 42:20

Uh-huh.

SPEAKER_04 42:21

You know, and I was looking at their numbers and I was really impressed because obviously they do shareholder meetings. Uh-huh. And I'm I watch every single one of them every year, and I'm like, man, these guys, they're doing it. 16 million a year in profit. You know, I'm like, man, you guys are doing it. But I mean, what a beautiful um, you know, overall winery. You know, French, Italian, Spanish, all under one roof, basically. Yeah, man, they're almost done. They'll be done. He's he'll get it done, you know. But I remember one time when we, when the pandemic hit, and everything, especially, you know, wineries, retail, restaurants, hotels, all that just got smacked hard right when the pandemic hit. And we st I think we got to a point where like, okay, everyone stop the race. I felt like it was 2008 again. I remember in 2008 when everything just went completely hush, and I told my team, I said, everybody just stop. And I read that was like I had that second moment because the first moment I said, okay, everybody stop back in 2008. It was actually 2007 when it started, but I just call it a wait. But um, I remember kind of going, I'm about to have my first kid and I couldn't even put food on the table.

SPEAKER_02 43:22

Yeah.

SPEAKER_04 43:23

So when the second time for me to tell everybody, hey, stop, I was thinking 2008 all over again, right? So I mean, capital raising came to a complete halt. Do you have, you know, stay home working?

SPEAKER_00 43:32

That's where the gray hair started.

SPEAKER_04 43:33

Oh, dude, it came out of my nose. Yeah. But um, yeah. And so I uh I remember doing that, and then I we we called, you know, we called a we called a meeting with everybody, and one of them was Dan Stevenson. I remember going to his office and we're all sitting there, and Dan just had his legs crossed, like he's been doing this since 1960, which is true. He's been doing it forever. And he's like, I remember going, like, Dan, aren't you stressed out? I mean, I got, you know, I'm sweating here, buddy. And he's like, we'll be all right. He's like, we get enough cash, we'll carry this for a while. I think we'll be all right. And he just had this presence about him. I'm like, well, if he's not worried, I'm not worried. But you know, all the other stuff is falling apart. Remember, we had an office in Denver. We stopped raising money for that. The one thing that was nice is that we were already funded on Parkview. So that was still underway. You know, and that's when we launched the debt fund because that's when money was being printed. We were like, Oh, well. Money's getting printed. That means inflation's on its way. So we might as well just launch a debt fund. Right. So I think we we we pivoted then and I kind of carried us through. Not a lot of people know how much that was that hard that was. But we don't, we not only just did that, we also moved out of state. You know, we made some big moves hard, fast. That's I think that's sometimes what's just taken to survive. But going back, you know, Dan was such Dan. I mean, I think that's the point is like you nailed it earlier, having the right people around you and experience, you know, there's no substitute for experience. And having Dan and you and all these people in my life has been huge because you guys have had this presence of patience and power and understanding and peace and faith that has allowed me to kind of carry that, you know, and I'm trying to use that energy to pass on to the people down, you know, that are working for me. And but also no, hey, it's it's go time at the same time, you know, it's in certain concepts, in certain perspectives.

SPEAKER_00 45:14

But you know, I I one of the reasons I Europa Village was so easy to underwrite and for me.

SPEAKER_04 45:20

Um he was already generating how much 500,000 a quarter just in just easy.

SPEAKER_00 45:25

Plus, I can forever. When I first ran for office, he won wrote one of my first one of the first checks for my campaign and um and always supported me through all my campaigns. Never once he'd asked me for anything. You know how rare that is. How rare there it is. And so you know, I I knew that man. I still know him. He goes to my church. I know.

SPEAKER_04 45:46

We talked about him last night. Yeah. How old is he, 88 now?

SPEAKER_00 45:48

87? Yeah, no, he's in his 80s, but you didn't you wouldn't know. He still snowskis. I don't know. I can't believe it.

SPEAKER_04 45:53

He's still skiing.

SPEAKER_00 45:54

Yeah.

SPEAKER_04 45:55

What a stud.

SPEAKER_00 45:55

But one of the things we liked about Europa Village was the multiplicity of revenue streams. So that if this is firing but this isn't, this is firing. And then that's just two, but there was like I sort of I've I forget the number, but it's like at least seven different revenue streams. You got the wine club, you had the wine itself, you had you had uh weddings. Every weddings, and and it wasn't wherever all the other wineries maybe had one venue for a wedding, he had 30 or something like that. And so all these different revenue streams that he created so that they could keep going. And they did very well during during the whole pandemic thing. Okay, I'll bring that up to say this. You did the same thing. I mean, there's the private equity, then there's the debt fund, and there's the the loans, and then there's mortgage, real estate, all that.

SPEAKER_04 46:44

Yeah. We had it all.

SPEAKER_00 46:45

And as things go in, now you're backing all that up with assets and everything else going on. And so what it allows you to do is have not rely on just one revenue stream, you know, so that when it's not good for debt, okay, that's okay. We got all these. We'll we'll we'll pause on that for now. And then and now, well, it's not good for the fix and flip folks. Well, okay, that's it. Well, we we have all these others. That's that speaks to the to to a solid approach to allow you to spend other people's money the correct way and stuff. And so it's it's I don't know, it it was it was fun. I mean, there were some hard times, but watching this thing evolve has been just a it's been a true joy to me. No, I appreciate what you've done there.

SPEAKER_04 47:32

Going back to Dan, you know, do you know what the main reason why I decided to kind of dig deeper into the underwriting? Because I didn't know him. You were the one that knew him. I hadn't known him. I mean, I knew of him, but I had never met him before. And uh, and it was because two things. One, he, you know, and I was still underwriting kind of like worst case scenario if market were to crash again, right? That's that's kind of an underwriter's mindset.

SPEAKER_00 47:53

Yep.

SPEAKER_04 47:55

And he had already started selling his wine club membership. And at the time, I think he had 4,300 wine club members already, generating, you know, half a million bucks every quarter. I think it was what it was. And uh, and I'm like, well, shoot, man, if the market crashes, alcohol sales go through the roof. That's what happened in 08. Alcohol sales boomed, right? Divorces, unfortunately, but alcohol sales went through the roof. So I'm like, okay, that got my attention. And then what was funny is his backstory was that he acquired the land in 2005 or six, I believe. He went through the entitlement process, got the plans approved, ready to start go to break ground. Boom, market crashed in 08. And that's when he decided to just do a little small capital call, grab some capital, and he built the little uh the um winery that he had there. It's still there. What's it called? I can't think of the word.

SPEAKER_00 48:43

Um me either.

SPEAKER_04 48:46

Goodness gracious, what the heck? We've been there a thousand billion times. But but it's the first one.

SPEAKER_00 48:51

Yeah, I know.

SPEAKER_04 48:51

I'm trying to it has the cave and has the little you know wine tasting room. I cannot think of it. Um anyway. Anyways, it so he opened that up, started making having, you know, obviously doing his wine, wine tasting. He had a little retail shop, had his event center, he had the cave, and he was doing weddings, and I mean he had landscaped it beautiful, and then that they were doing the hot air balloons out of there. Remember that? Oh, yeah. They're still doing all the hot air balloons out there. So we had a cool little thing going on. But what was nice is that when he was telling me, he goes, Well, in 2008, when this had happened, we decided to just build this, and uh, and uh we were we launched the the wine club membership and we ramped up to 2,000 wine club members right away and we started cash flowing immediately. And I was like, what a stud. He saw it in 2008. That I I'm looking at underwriting, kind of going back to a 2008 situation of worst case scenario. And then guess what had happened when the pandemic, because we were already raising money before the pandemic for him, when the pandemic hit, dude. He went through the roof, he went, what was it like 4,200 wine club members a year and a half later, a year later, it was 7,000. 7,000. Yeah, he doubled pretty much in like a year, just on that. And they were just moving, you know, uh wine like it was just Skittles, man. They were just doing it. And then now I think if I recall, I think he was over 12,000 or 14,000,000 now. It's wild.

SPEAKER_00 50:02

One of the things about the, you know, about Europa Village, um, it's for those who haven't been there yet, um, if you but if you've been to Epcot Center in Florida, um basically you I mean, this man, the underwriting he did, um, including going to all the countries so he can be make sure he's very authentic. But the idea was is that he he had the three wineries, Bolero, Vienza, Cela V, and people could just come and park and go to three wineries. And he did that because he did the research, uh market study, which so many people don't do. Um, he did the research to understand that when people come do wine tasting, they usually go to three wineries. Three wineries and such. And then he added, you know, there's the the the venues, and then he had, you know, and then eventually we'll get to get the hotel done and and things like that. Um, already had the the the bed and breakfast. He had all those different revenue streams.

SPEAKER_04 50:58

And then he brought in he brought he brought in um Chef Hani that opened up 29 four seasons all around the world and they just won all kinds of awards. There's still like number one restaurant or some crap in California.

SPEAKER_00 51:08

Yeah. It's unbelievable. His thing was French cuisine, and he's yeah, now he's done Spanish, he's done Italian. He has to do this French one. And he's from Egypt. He's from Egypt, go figure. Um But the the story behind that is that, which gets back to paradigm, is what most folks who really enjoy that property don't understand is how many times Dan had to pivot.

SPEAKER_04 51:31

Oh yeah.

SPEAKER_00 51:32

And but he didn't just pivot out of fear, he did the research, he did the he understood and and stuff, and so which is a good example for this kind of thing going on when we have a private equity firm, and so which is why I like the different revenue streams, is because you can pivot, but you can piv pivot now, as we get back to this again, from our early days to where you are now based on experience. You don't have to make it up. Um but when you take me through the current projects, and then when you take me through you know some of the ones you're considering at this point, one of the things that you know I feel like I'm blowing smoke

Multiple Revenue Streams And Investor Access

SPEAKER_00 52:20

here, but this is this is you know, we're not still we're not making this up, guys, okay? This isn't real. This is real for me. Um one of the things that to this day two things that amaze me. First of all, your your grasp of the details. I mean to the number. Um any given project, you can just spit it out. You got you've got that going. Most folks get so far into the weeds like that they can't have vision. You know, it's just all these details going on. But then the process, you come up with barn caves and the man caves, and then there's the gym, and then all these different things. And then also how you set that up, because if you keep them together with like the HOA or you do all that kind of taxes or tax credits, and all that kind of stuff going. And so it's beyond the weeds, it's the big picture and stuff. And um just I I should think of those things.

SPEAKER_04 53:21

It's kind of cool because Mike and I work with like a like we look at like a cash flow analysis as a firm, and you kind of look at like, okay, tax credits that can go from all these projects to investors, but we inherit some of those tax credits as well. And then how we can use some of that to not pay so much in taxes, but then we're able to hire more and more, you know, employees, right? Or we can imp invest into certain softwares or systems or what have you. It's really cool when you see kind of like how we've created the wealth structure of the firm and then how we're trying to get that down into like shareholders level, you know? And that's what I think that's what private equity really is. That's why I think so many people are starting to go into smaller operators because they do have the ability, especially with tax credits. And right now, one of the big movements is people are just tired of politics and they're selling businesses and retiring kind of early or setting themselves up for retirement. So they're starting to get in front of things a lot earlier. And when, since, you know, for example, Havasu's just a hop, skip, and jump away from Cali, and this is such a destination for retirement, you know, you're just having more conversations setting up for that. And most of it is hey, once I retire, I only have so much money. And now I need tax credits, I need to keep my overhead low. I need to, you know, healthcare is getting more expensive. You know, I want to spend more time with my grandkids, I want to leave my wealth to my grandkids. What if something were to happen? What about life insurance? Like all those things start coming up. And so we feel pretty blessed because people are coming to us for a lot of advice, which we legally we can't give advice, right? We have to tell them to go to the right directions, but we understand and we can at least re you know give them resources. And then uh, you know, and then you just when you start having those type of conversations with people, kind of goes back to what I was saying. It's like those are those humble conversations, you know, it's those kind of different connections to the world and and and to to people that is just really fruitful. And I think that's what's feeding my soul nowadays more than anything.

SPEAKER_00 55:07

There's a book, once again, whose title escapes me. I gotta work on that. Um I'm horrible with names. Yeah, it's I'm horrible with names. Everybody's buddy. Um but uh there's a book that was written that I read probably 10 or 15 years ago that dealt with the dynamic of the big fish and small pond and why that was preferable to little fish and big pond. I read it because at that point my son Miles was um was getting ready to go to college and he was you know he was graduated number like 14 in the classes, etc. Super smart. We thought architect, engineer, something that smart people did. And um but what he went into was music, playing the trumpet. You know, so you can imagine that's where some of my gray hair came from. And because there's a whole lot of good he was very good, a whole lot of good musicians um that were starving. And he Which is so common, it's very common and such. Um but he was getting all these full ride scholarship offers to play trumpet at these different schools. And so, long story short, the upshot of what I learned from that book was he didn't need to go to USC, even though they were very they wanted him. He need to go to Redlands. And today he's just finished his fifth movie, he's in Disney, he's in he's in Laguna where he plays for the pageant, he's in every symphony in Southern California, he's high demand, everything else. And it led to, you know, from from because he was a big fish in a small pond, he got to play everything and he got all kinds of experience. I say that to say not that we're a uh a big fish in a small pond, because our pond's huge. Um but when people are looking for attention, where it's I'm just gonna I'm about to rewrite a check to you for a hundred thousand dollars and such. Will you remember my name?

SPEAKER_02 57:19

Yeah.

SPEAKER_00 57:19

Will I be able to get answers if I have questions, everything else? And the uh likelihood of being able to get that in a that kind of an intimate relationship in a huge pond, as opposed to if you're coming to a paradigm in the in our world and such, uh likelihood you're gonna get a better answer and more intimate relationship stuff in the from the paradigms. And I think for me, I believe that's why in this world right now where everyone's a number, yeah. Um that that the paradigms of the world are gonna find more success when attracting folks because of that one thing. It's a huge thing. It's a huge thing.

SPEAKER_04 57:57

Well, you know, and it's it's very common for groups like us when you look at AUM, you know, people will stick with you for 10, 15 years. You know, so the idea is to try to perform for your clients, especially if they're new with you, and then you roll your capital into future projects. So it allows the firm to grow organically with the same relationship. So when you go to establish a relationship, it took so much time and energy to earn the trust, you know, and and once you've earned it, you're hoping to keep it so the fight is on, you know, but at you know, just fighting the world. But you know, when you once you establish a relationship, the idea is to keep them with you. So once you've performed for them, you're like, hey, you want to come with me to the next one? And most of the time they're like, absolutely. It may take a little bit of capital and go play with it or go pay off some stuff or what have you. But you know, most of the time they're gonna go, yeah, I'm still pretty young. I don't continue to accumulate, I'm worried about the world, go play with it, go do it, you know, do it in the next deal. So it's been nice.

SPEAKER_00 58:43

Well, many times that's what you're supposed to chase. We've had investors who somebody got in their ear. And um I hearken back to politics again when I'm looking for votes and such, and somebody gets in their ear, oh, let me tell you what Doug did, or whatever else. And so and whether it's true or not, somebody got in their ear. So I had a hard time getting that vote. Um, but the same thing with paradigm, you know, somebody gets in an investor's ear, whether it's before they invest or after they invested and such. And so we used to spend, and I'm sure you still do, uh a decent amount of time dealing with that.

SPEAKER_04 59:17

Oh, yeah. Especially with the market right now.

SPEAKER_00 59:18

Yeah, with the market the way it is. And so right now for us it's important to wear, but it needs to be dealt with, doesn't it? And so when they call us, say, somebody just told me X, Y, and Z about you, what's going on? And stuff, take the time to walk them through what's really going on. And nine times out of out of 10, they're go, Oh, okay, no problem.

unknown 59:38

No.

SPEAKER_04 59:38

Well, especially what's nice is that most of my clients are business owners, right? We're only going after millionaires. So, and I say it respectfully, but you know, usually you have some sophisticated people when you start sharing with them what's going on or what's happening or what we're worried about

The Small Firm Advantage In Trust

SPEAKER_04 59:50

or whatever the case may be, they're like, God, it makes sense. You know, you just get more support really because it's just giving you the ability to kind of walk through maybe some hardship and how you overcome it. Um, but establish that relationship even you know deeper because the nice thing is they were able to reach out and touch you. So you're not just some guy behind the desk with a suit on and he's on vacation to the somewhere and you can't talk to them for the next two weeks, you know, that type of stuff. So it's a little different for sure.

SPEAKER_00 1:00:13

Yeah. Well, that's the point, is that in the smaller firm, um, I mean, then the numbers you're dealing with are huge. But compared to some of the firms in the world, it's a smaller firm.

SPEAKER_02 1:00:23

Yeah, really.

SPEAKER_00 1:00:24

They can get hold of you. And um and it my reality is you actually like talking on the phone. I watched it. Okay, that calls done, call this person and stuff. Oh, yeah. And so there's um, you know, you're very accessible. And I I once again, as I watched over the years, those are the kinds of things that led me to invest. Um, but I knew I I knew my money was going towards a a good cause, if you will. Um, the cause being Ryan Ryan Garland. And I figure that, you know, back in those days, you know, the check I wrote and the couple others I wrote before that, just to help with the company, was to keep things going. Um now with that check I wrote, probably uh it's a pittance compared to some of the other stuff that you get and such. But it all matters. It mattered at that point. And so watching, I I as much as I want it, even back then, both my wife and I wanted you to succeed. My wife loves you, um, wanted you to succeed um and such, that check would not have been written had it not, we're not just gonna throw our money away. Sure. So at some point in the future, I'm gonna get a return. Cool. Yeah, I'm all over that. But what's more important is I'm gonna get a return because you're successful. That's what I cared about. Yeah, and I'm not trying to be sicky sweet here or anything else, but but I I really that it really is my motivation.

SPEAKER_04 1:01:48

Yeah, I appreciate it, man. That means a lot. Well, Doug, thank you for joining me here, dude. I really appreciate it.

SPEAKER_00 1:01:52

Well, thanks for taking the time. It's great to see you, dude.

SPEAKER_04 1:01:55

Well, you know, it's it's just you know, we've only seen each other, what, a couple times in the last year?

SPEAKER_00 1:01:58

Yeah, it's been very, very Yeah, only a couple times.

SPEAKER_04 1:02:00

And I don't go out to California that much.

SPEAKER_00 1:02:02

Yeah.

SPEAKER_04 1:02:02

No, Shane's out there more than I am.

SPEAKER_00 1:02:03

Yeah, well, for years.

SPEAKER_04 1:02:05

Yeah, yeah. But I've I've been going back and forth between here and Tennessee, so I haven't been able to get out there. Well, normally I do. I'll call you and like, what are you doing?

SPEAKER_00 1:02:12

When you do this, we'll have lunch.

SPEAKER_04 1:02:13

We're gonna go to Europa, is what we need to do. I last time Shane had his pictures there for prom and I saw Chef, and he's like, Ryan. I'm like, I know, don't beat me up. He's like, Where have you been? I'm like, I'm hanging out at your 16. I think he has. So he had a 16-room house that's like one of the closest houses ever built to one of the uh pyramids in Egypt.

SPEAKER_01 1:02:34

Really?

SPEAKER_04 1:02:35

Remember, he used to offer us to go, and on the opposite side of the house was a golf course, and he loves to golf. Because remember, he was golf with Dan on Mondays. I don't know if golf Dan's golfing anymore, but he likes to golf on Mondays. Uh-huh. And so I hit him up. I'm like, You still gonna allow me to go uh go stay at your house? He's like, Well, yeah. He's like, But you know you won't do it. I'm like, I know, I'm just gonna ask. I never have time. I forgot all about that. Yeah, he had a big house. He has a he has the largest home that's the closest house house ever built to the pyramids.

SPEAKER_00 1:03:02

Wow.

SPEAKER_04 1:03:02

Yeah.

SPEAKER_00 1:03:03

He's such a such a good guy.

SPEAKER_04 1:03:05

He and he calls himself the red-headed stepchild of his family. All of his family and brothers and sisters are doctors and some decorated guy. He's like, I do wanted to culinary arts. I'm like, Yeah, man, but you opened up 294 seasons around the world. He had he'd he fed a fan, he had this whole big family thing. He he said that he fed like 4,000 families in one night one time. I'm like, man, you're nuts. This guy's something else. He can't rally. He is he remember we did our investor appreciation events there? Uh-huh. Our food was perfect. Yeah.

SPEAKER_00 1:03:32

Well, I do several events there uh over the course of a year, and um, it's always, always perfect food.

SPEAKER_04 1:03:37

He does, he's something else, man. You know, and now he's got three more um restaurants he's overseen there. What a stud. Yeah, that that place did really good. I try to encourage people if you've never been there, just go. And because it's a kind of a getaway, right? As soon as you get into wine country, you don't even feel like you're in California. It's such a great feeling. Yeah.

SPEAKER_00 1:03:54

Well, Dan is the ultimate example of someone who understands success means getting the right people around you.

SPEAKER_04 1:04:00

That he is the best at that for sure. Yeah, I give him that.

SPEAKER_00 1:04:03

And I think you're doing the same thing, dude. So thank you, I appreciate you making the time today.

SPEAKER_04 1:04:06

Appreciate it. Yeah, thanks for coming on.

SPEAKER_00 1:04:08

We've been talking about it. Yeah, I'll come back one day. We'll and we'll we'll recap.

SPEAKER_04 1:04:11

That's right.

SPEAKER_00 1:04:12

Okay.

SPEAKER_04 1:04:12

All right, everybody. Thank you very much for joining us and on to the next.