Episode Transcript
[00:00:00] Speaker A: Welcome to create wealth through franchising. I'm your host, Kim Daley.
Whether you're a CEO, a military vet, a real estate investor, or simply in career transition and ready to take ownership of your future, with each episode, you're going to learn valuable insights and hear inspiring stories from within the franchise industry.
On that note, my guest stories are their own. And as a franchise consultant, I do not make personal brand endorsements or earnings claims, but I do educate, motivate, and inspire dreams.
Now onto the show.
[00:00:44] Speaker B: Welcome back to American wealth strategies and Kim Daily TV. I am your host, Kim Daley, and in my studio today is my friend, the lamb geek, Mark Badowski. Mark, welcome to the studio of American wealth strategies and Kim Daley TV.
[00:01:00] Speaker C: Kim Daley, it is so great to see you again. Thank you so much for having me.
[00:01:07] Speaker B: It's great to see you again. This man is a very busy guy and he is very hard to get on his calendar to be a guest on his show.
So to be a guest on my show, it's quite an honor. So the land geek, Mark. Let's just dive in here at american wealth strategies. The whole purpose of this show is to help my followers, who typically come from a w two world where they traded their time for money. Like the apostle Paul got struck by lightning and said, you know what? What am I doing? There's a better way. They meet Kim Daley. I help them build an active or semi active business through a franchise. And so now they're on this new wealth creation journey. But they may still be thinking about their total portfolio, as in putting money in a 401K or a self employed pension plan, rather than really thinking about how do the wealthiest people in the world invest their money, which is not in the stock market or 401 ks, and you're here to be the expert on investing in land. So introduce my followers to your background, how you started investing in land, why you started investing in land, and then we'll take it from there.
[00:02:21] Speaker C: All right. Yeah. Let's start from the beginning. We'll rewind the tape to 2000. I was a miserable, micro managed, 45 minutes commute to working back investment banker specializing in mergers and acquisitions with private equity groups. And Kim, it got so bad for me. I wouldn't get the Sunday blues anticipating Monday coming around. I'd get the Friday blues anticipating the weekend going by really fast, having to be at work on Monday.
[00:02:50] Speaker B: That's bad.
[00:02:51] Speaker C: It was bad.
[00:02:52] Speaker B: So can't even relax on Friday, you know, something's gotta change.
[00:02:55] Speaker C: Yeah, no, for sure. And so my firm hires this guy, he's telling me that as a side hustle, he's buying up raw land, pennies on the dollar. He's flipping them online, and hes making a 300% return on his money. And Im looking at companies all day long, and a great company, great, has 15% EBITDA margins or free cash flow. Average companys 10%. Im looking at companies all day long, less than 10%. So of course I dont believe them. Ive got three grand saved up for car repairs. I go to New Mexico with them, I do exactly what he tells me to do. I buy ten half acre parcels, an average price of $300 each. I flipped them online, and they all sell for an average price of $1,200 each. 300%. It worked. So I took all that money and went to another auction in Arizona, which is where I live, and this is 2000. There's no one in the room. I'm buying up lots and acres for nothing. I sell all that land and I made over $90,000 cash. So I go to my wife and she's pregnant. I said, honey, I'm going to quit my job and become a full time land investor. And she said, absolutely not. So I said, okay, okay, okay. So it took 18 months for land investing income to exceed the investment banking income, and then I quit. I've been doing it full time ever since. I've done over 6000 transactions and counting. And I think, Kim, I think I have the best passive income model.
[00:04:19] Speaker B: You have an amazing passive income model. Now, in the franchising world, we're not allowed to make earnings claims. And I just want you to give the liability statement on Kim Daley that any earnings claims that are made here are unmarked. Not on Kim daily.
[00:04:32] Speaker C: No, no. 100%.
[00:04:33] Speaker B: You can make any amount of money from Mark Wadowski.
[00:04:36] Speaker C: Yeah, I mean, I make it sound easy. Nothing worth doing is easy. This is not an easy thing to do, but it's a simpler real estate model than what people tend to have to go into in traditional real estate.
[00:04:49] Speaker B: Do you offer courses or like, has somebody helped you? Kind of gave you a system on what to do? Do people pay you to teach them to do what you do?
[00:04:59] Speaker C: Yeah, so I help everybody along the economic spectrum. So if you have no money and lots of time, I'll give you free training. If you have money, but not a lot of time, we'll do it with you or do it yourself. If you're rich and you want to be wealthy, I'll do it for you. So we help everyone along the economic spectrum, the whole idea being that once your passive income exceeds your fixed expenses, then you're working because you want to, not because you have to. You can move up Maslow's hierarchy of needs into self actualization and really figure out your deepest purpose in life.
[00:05:35] Speaker B: That's awesome. That's what happened to me. That's exactly my story. My followers know that. Right? So I got into this alternative investing world. I mean, I've always been a business owner since I was 25 years old. So I had that down. I started excelling in my franchise business, and I had all this extra money, and I was meeting these people who were truly wealthy, who were not putting money, like I said, in the stock market or in their self employed pension plans. And I said, okay, wait, why aren't they doing that? I started asking better questions, and I started getting answers. And so then I had to get my big girl pants on and start taking the money out of the mutual, you know, plans and mutual funds and putting it into some of these assets, like land, and first starting with imminent banking policies to have your velocity of money, and then into land and real estate, syndication. And I. What I found for myself was, since I know business, I like the investments in businesses that were more, like, passive for me, because that's what I know, and that's what I enjoy learning about. I give any advice, that's what I'm like, because there's so many different ways you can invest your money. And like Mark said, he makes it sound easy, but nothing worthwhile is easy. And so you have to find something that you're going to enjoy. Like, I've made some mistakes and lost some money. You know, my good friend Jim Oliver told me to invest in crypto mining business, and so I gave him a lot of money. I believed him. This is going to be great. Yeah, well, so I didn't make any money on that investment, right? So. And I didn't even like it. I don't even know why I did it. I don't even know that I believe in crypto. So back to this conversation.
So who should invest in land?
[00:07:04] Speaker C: So if you're ambitiously lazy, you should invest in land.
So I'm ambitiously lazy. If you want to grind, right? You want to work 60 hours a week, you want to meet subcontractors, this is not for you. If you want to work anywhere in the world with a laptop and an Internet connection, you can be in the land business. So, Kim, let me walk you through the model, and then I think it'll be good for the listeners to really see if this is something that resonates with them or not. So where do you live?
[00:07:37] Speaker B: I live in southern New Hampshire.
[00:07:39] Speaker C: Okay. You're in southern New Hampshire. Okay. Beautiful. Youve lost all complaining privileges, but lets say you own five acres of raw land in Colorado and you owe $200 in back taxes. Right. So youre advertising two important things. Number one, youve no emotional attachment to the raw land. Youre in New Hampshire, properties in Colorado. And number two, youre financially distressed in some weird way, because when you dont pay for your property taxes, you dont value it in the same way. As a result, the county treasurer keeps sending you notices saying, Kim, you don't pay your property taxes, you're going to lose your property to a tax deed or a tax lien investor. So all I'm going to do is look at the comparable sales on your five acre parcel for the last twelve to 18 months. I'm going to take the lowest comparable sale, let's say it's $10,000 and we divide by four, and that's going to get me what Warren Buffett would call a 300% margin of safety. So I'm going to send you an offer for $2,500. Now, you accept it. Why? Because for you, $2,500 is better.
Now, it's free money. But in reality, three to 5% of people are going to accept my quote, unquote top dollar offer. But now that you've accepted it, I have to go through due diligence or in depth research. I have to confirm you still own the property. Back taxes are only $200. There's been no breaks in the chain of title. There's no liens or encumbrances. I outsource all that to my team in Jamaica. They're connected to an american title company. Cost about $11. Now, if I were investing more than, say, $5,000, I wouldn't take any title risk. I would just close traditionally through a title company. But this is only $25. We'll assume everything checks out. I'm going to send you a check for $2,300, the treasurer check for $200. I own it free and clear. And now, Kim, I'm going to sell this property 30 days or less. I'm going to make a cash flow like a rental home. Now I've got a built in best buyer. Do you know who it is? The neighbors. The neighbors. So I'm going to send out neighbor letters saying, hey, here's your opportunity. Protect your privacy, protect your views, know your neighbor. Oftentimes the neighbors will buy. If they don't buy, go to my buyers list. My buyers list doesn't buy. I'll go to a little website you may have heard of. It's called Meta or Facebook, the buy sell groups in the marketplace. And then I'll go to maybe Zillow, Craigslist. And then I'll go to, like, landmodo.com or lands of america.com. landflip.com, landhub.com. land.com. So these are platforms where people buy and sell raw land. But the secret is in the pricing.
[00:10:23] Speaker B: I bought a piece of land for privacy. Cost me $202,000.
[00:10:27] Speaker C: Yes. That's not the model. No, you're not buying it. 25. $0.30 on the dollar.
[00:10:32] Speaker B: Following the land geeks.
[00:10:34] Speaker C: No. No. So.
[00:10:36] Speaker B: But I did buy it, and I do have privacy.
[00:10:37] Speaker C: Oh, there you go.
[00:10:39] Speaker B: And it's been assessed for 265 after I bought it. Retail for 250. And I think I can now turn around, flip it for 350. So I think I made some money out, but I'm not, because I want the privacy. I don't care about the equity.
[00:10:51] Speaker C: Yeah, no. So this is not an investment, Kim. It's not cash flowing. I want to show you the cash flow. So I'm going to ask for a $2,500 down payment so I don't get my money out on the down payment. I could go six to ten months out. Right? And then I'm making a car payment. Let's say 297 a month at 9% interest for the next 72 months. So it's a one time sale. I get my money out as fast as possible. Now I'm getting 297 a month at 9% interest the next 72 months, Kim. No renters, no rehabs, no renovations, no rodents. And because I'm not dealing with a tenant, I'm exempt from Dodd Frank Respa and the Safe act, all this onerous real estate legislation. So then it's a simple game. Can we create enough land notes where our passive income exceeds our fixed expenses? And then we're working because we want to, not because we have to.
[00:11:41] Speaker A: Hey, daily coach fans, if you're ready to begin your own journey to find the perfect franchise, please email me right now at enquireimdaily TV. My services are totally free for you. That's inquiremdaily TV. Now back to the show.
[00:12:03] Speaker B: Crazy game. Like, are you listeners following this? Like, are you laughing hysterically? Okay, so now, in the beginning of the show, you said whether you have no money. Talk about the level of investments that, like, realistically, like, what kind of money does somebody need? Or is it realistic that you don't need any money? Like, talk about that. I understand we need some skill, skills, but I'm going to come back to that one. Let's start with money.
[00:12:25] Speaker C: Yeah. Yeah. So I started with $3,000. A buddy of mine started with $800. I typically tell our client, it's good to start with $5,000 and let's say ten to 15 hours a week to get the understanding of the business model. But you could definitely start with less. I had a client, Paul Mendel, and Paul has no money, but he has money for mail. I started sending out offers, and he finds a property for $10,000 in upstate New York. Well, he doesn't have $10,000. So I said, paul, do you have enough money for mail? Mail the neighbors. So he mails the neighbors, and the neighbors like, yeah, I'll buy it. So Paul's like, okay, great, it's $20,000. So you send me $20,000, right? And then he gets the $20,000 he sends. The first person who said he sells for $10,000, he makes that spread. Then he sends to the recorder, record this deed first, record this deed second, and had an infinite return on his money.
[00:13:26] Speaker B: But who's the person who's just sending Paul $20,000? Like, there's so obviously there's things here, as I'm listening to you, and there's, like, secrets in here that you don't have to give them all out here, obviously. But like, yeah, so let's go back to the salesman part of this. I mean, because, you know, you said ten to 15 hours, right? So you do have to learn. There's a business to learn. And there seems to be some wheeling and dealing. It's not going to be the introverts business. Like, is it like the Amazon e commerce business might be.
[00:13:54] Speaker C: Well, I'm a big who, not how. Right? So the last thing we want to do, and we teach people this, we're not going to have you build yourself another job. So you're going to learn enough so that you are delegating, not abdicating. And the first thing you're going to outsource is what you hate doing the most.
Most people hate doing what we call intake, which is they start sending out offers, and then the sellers start responding, and they get on the phone and maybe they're mad about the offer or they don't understand the offer. But then they start telling you the story for 30 minutes, how they bought the property, why they bought the property. So get that off your plate. Right. So we get someone on intake, and then we get inexpensive virtual assistants to post our ads. We get an inexpensive virtual assistant to be our sales assistant to filter out our leads. And then if you really hate talking to people, you really need to find somebody to close a deal for you and pay them a commission. So whatever you hate doing, you outsource, you delegate. What you love doing, you keep. But keep in mind it's a business. I wouldn't buy a franchise and then just not look at the manual, not look at the systems and processes. I would understand it. I would look for the people that have that unique ability to execute on that. I would hire them. So I just become an expert at finding experts. But I need to know enough so that I'm not abdicating my business to inexpensive virtual assistants.
[00:15:25] Speaker B: I like it.
[00:15:26] Speaker C: Does that make sense?
[00:15:27] Speaker B: It totally makes sense. So what are the downsides to this? Like, my mind goes to, okay, for the pessimist out there who's like, sounds too good to be true, Mark. Like, how do you lose money in this investment?
[00:15:39] Speaker C: Yeah. You don't, because we're making our money on the buy, so we're buying the asset. 25 if you get what I call. Got to have landitis and you start overpaying, that's not good. We want to keep our margin of safety. If you like, love Michigan or Ohio, Pennsylvania land. Well, you've got to go to EPA, dot gov and make sure you're not buying at a Superfund site where people are dumping. So we focus on rural areas in the southwest, northwest, California, Florida. So there's a lot of inexpensive land out there. You've got a massive market where people want to eventually either build out there or they camp out there. They use it recreationally. Maybe it's just for an investment. Like all legacy investors. That's going to be your biggest buyer pool, right? I mean, let's face it, right? Nobody wakes up and thinks themselves, boy, like some raw land in Iowa today. Unless you live in Iowa, you got to learn county, research our market, and it's really easy. Ken. Right. We kind of use the McDonald's approach. If I'm going to buy. I know you hate fast food franchises, but I was going to buy one. I was going to buy one. I want to go where McDonald's is because they've done all the work they've done. The traffic counts. They know the market. So I would go to a site like Landmodo.com and just see where other land investors buy there.
[00:17:02] Speaker B: Interesting. I mean, who knew? Who knew there were parcels of land in the middle of nowhere that people own? Like, you just don't think of it, right?
[00:17:10] Speaker C: Yeah. I mean, you're not the market. I'm not the market. Going back to that McDonald's example, I don't eat McDonald's. I'm not the market. But there's a billion people that do. And so there's a massive market for people that want to own inexpensive, raw land that they can afford.
[00:17:27] Speaker B: Does anybody ever invest in the land and then they can't find a buyer for the land? Is that the downside to it?
[00:17:34] Speaker C: I've never been stuck with a piece of raw land. There's a pig for every barn if you price it right. I bought property on the side of a mountain and sold it.
[00:17:45] Speaker B: Ladies and gentlemen, you've heard it all here. There's a pig for every barna.
[00:17:51] Speaker C: Like, I think we got a show title.
[00:17:54] Speaker B: Yeah. I love seeing you, Mark Wadowski. I love having you in my studio that this is going to be one of the most downloaded episodes ever. Because, I mean, if it is, as you say, it is for every investor, because you don't need a certain amount of money like you do in other things, and it's more passive than it is active, especially once you learn the system.
And since I've asked the question, how do you lose money? And you said you don't. I mean, where's the risk?
[00:18:23] Speaker C: So I really think the risk is just not getting educated and just trying to do it. So you've got time risk. Maybe you don't have money risk, but it might take you five years to figure it out. You go on this YouTube channel, you listen to this podcast, or you go on my blog, and you try to piece it all together and you get a little bit of information here, a little bit of information there, and you realize, oh, wait, I'm. This isn't a good county, or this isn't a good market for me. And it's taking me, like Mark said, it should sell in 30 days or less. I think that is definitely a risk in and of itself. And then to your point, like, it's not for everybody, because there are people that can look at something physical and they can get it right. Like, they're like, okay, everyone needs a house. We all understand that. And so, yeah, nobody needs a piece of raw land, but 99% of what we have in our lives we don't need. So we want it. And so I think it's just that mindset shift as well.
[00:19:26] Speaker B: Yeah.
[00:19:26] Speaker C: And also you've got to understand like you may not be the market in the sense like stretch lab. Right. Like I don't even stretch. I know nothing about it. Right. But the model would work for me based on certain attributes that I might like coming in from my business background even though I don't stretch.
[00:19:46] Speaker B: Yep. I get that part of it.
[00:19:48] Speaker C: It would have to be a mindset shift.
[00:19:49] Speaker B: Yep.
[00:19:50] Speaker C: Right. So to your point, like, well, if you're buying a piece of property in rural America and you've never even, you know, gone on a road trip to even see what it's out, like, they're like, you may not get it, it might not be for you.
[00:20:02] Speaker B: Yeah, yeah.
[00:20:03] Speaker C: Like you gotta believe in what you're doing.
[00:20:04] Speaker B: If you've done over 6000 transactions, the majority of the land you purchase you've never seen. Correct?
[00:20:10] Speaker C: Yeah, yeah. So what I'll do is, you know, first of all, it's a legal document, there's a chain of title. But as far as like doing my due diligence for $50, I might have somebody local go out there. I'll use an app called what, three words. So they'll download that app and then I'll know the GPS coordinates and that'll send me their GPS coordinates. So I know that they're out there and they're not just taking pictures of random areas and shooting video. I want them to assess what's the road like, where are the neighbors? Like how far from there's hospital, how from there's Walmart, is it treed? What's the slope? And so I can kind of assess what's this property really like? I mean, so, you know, we do our due diligence as well.
[00:20:51] Speaker B: It's incredibly intriguing. I mean, there literally are so many ways to make money. I've known Mark for several years now. I think we were introduced initially by our good buddy Jim Oliver together. Right. I think that's how we eventually got together and then through the boys at wealth without Wall street. And I'm going to vouch for Mark. For those who are interested, we're going to put Mark's contact information in the show notes. But Mark, let's give you an opportunity to call out a little call to action for those people that are inspired by this who want to take the first step in learning more about working with the land geek.
[00:21:25] Speaker C: Yeah. So I wrote a book called Dirt Rich. It talks about my story and goes a little bit deeper into what we've just talked about. And I'd like to offer your listeners that book for free. Just pay shipping and I'll give them that link.
[00:21:37] Speaker B: That's amazing. We will put the link to dirt rich in the show notes for sure. Mark, you're amazing. It's always great to see you. Thank you so much for blessing us today. Teaching us about investing in land and the land yeek way here on american wealth strategies.
[00:21:53] Speaker C: Kim, you're just a joy. Thank you.
[00:21:55] Speaker B: You're a joy. Smiled so much in this episode, my cheeks hurt. Then don't forget there's a barn for every pig.
[00:22:03] Speaker C: Yeah, there is.
[00:22:05] Speaker B: That's amazing. Okay, too much fun. For those of you who are listening, thank you so much for enjoying american wealth strategies. My name is Kim Daley. I want to be your franchise consultant and your daily coach. So don't forget, if that's where you're headed, to an active or semi active business, I'm your girl for that. Mark's your guy for the land. Until next time, I'll see you right here on american wealth strategies.
[00:22:33] Speaker A: You can find more content just like this on my YouTube channel at Kimdaily TV. And if you're inspired to take the next step to explore franchises matched to you, please email me right now at inquireimDaily TV. That's enquireimdaily TV.
