Brady MacDonald - RPDRS

Alfonso: We have Brady MacDonald, and before I introduce Brady, I just wanted to ask you guys, does anybody remember the name of today's event?

All: Real People Doing Real Shit.

Alfonso: Are we real people in this room? Are we doing real shit every single day? Is it easy? No. Is it simple? Yeah. There we go. What a great way to start off the day. Guys, Daniel St-Jean.

Daniel: I know we have some information here for Brady. Let me read this first, but then I just want to add a personal note of how I met these guys. A couple actually. It's raining in December of 2014 and I go sit at a table where Kristy is sitting. She's just started. This is our first rain event. I'm there because I'm going to maybe get an award or two, or actually end up getting three. That lady there at the end of the evening is totally impressed with me because out of seven, you are awarded that evening. I got three of them. The table is covered with awards and she's totally wow.

In the five years while I've been here, they went from just starting to now over a hundred properties. When you are close to a hundred properties, when you shared that with me, a couple of months ago, I said, okay, you are all about scaling. You need to come and talk to these people on that Saturday of people doing real shit. Cause if there's anybody doing it, you and Kristy are doing it. I'm going to introduce both at the same time, because when I asked this guy here and how many weeks or whatever were you on vacation last year while you were building this business?

They go from zero to a hundred properties in four years and they're spending six months of vacation and you have kids. You want to hear how you are going to do that? He will mention something about systems I'm sure. The system lady is sitting at the back. She's coming after him. I'm going to introduce both at the same time, Brady and Kristy but let me read what you sent.

Brady is a full-time real estate entrepreneur who after investing in real estate for only two and a half years, quit his $120,000 a year corporate job. I talk about jumping off the plane. Alongside, his wife and business partner, Kristy MacDonald, they have scaled, they use their business to 15 full-time employees and have purchased close to a hundred properties in only four and a half years.

Brady does not only have passion for business and real estate, but equally for enjoying the lifestyle. It has provided him and his family like six months. They love to travel the world. And has recently cruised the Florida keys and Bahamas for six months on their 53 foot yacht whilst still managing to buy 18 plus properties. Brady.

Brady: Thank you very much, Daniel. First thing, we're going to talk about scaling your business. We're going to talk about our business a little bit, just so you can put it into context about how you can equally scale yours. First, I want to know who am I talking to? Who's in the education phase of investing in real estate. Awesome, you guys are going to learn a lot of stuff today. Who is looking to invest? Who's looking to get started? Who has one to five properties? Who has 5 to 10? And who has over 10? You guys are in a good room. You guys are gonna learn a lot.

One thing about scaling your business or investing in real estate is whether you want 5 properties, 10 properties, a hundred properties, a million properties doesn't matter. We are going to tell you what we've done doesn't mean that you need to do it. Don't feel pressured to buy more, do whatever. That's just one thing. This is the way we've scaled. There's multiple ways to scale your real estate investing business. If you want to scale your business from 0 to 10, By all means, take some of the tidbits that I've got for you and implement those into your business.

And if you want to scale to a hundred, ours has worked for us, but it may not work for you, but so there's multiple ways to do the thing that's different. So who the heck is Brady? So Bray's a lifestyle entrepreneur. I'm a full-time real estate investor. We've invested in Perry, Hollywood, Midland. All throughout Simcoe County. Does anybody know where that is way up North? We also have a property management company, live with BK Property Management.

What we've done is we utilize the same staff that we have to run our real estate investing company, and also we've scaled our business. In another sense, to offer property management services again, multiple streams of income is a good way to create wealth. I'm also a husband, a father, and a real guy getting shit done. I must note that I do have a great wife. She's also my business partner and 85% of this is due to her too. Before real estate investing, this was me, I think when I was about 19 years old, I looked the same, but I have the dad bod layer over top.

I used to climb trees up until 2017. I taught people how to climb trees for a living. I worked for hydro 1. I was a utility arborist instructor. I literally did this next to hydro lines. I used to teach this and that was my full-time gig. We started investing in real estate in 2014 was our education phase, 2015 we did our first deal. That was when we determined, figured out our strategy, bought one property, converted it to a legal duplex or a second suite refinancing it, refinanced stays. We get all of our renovation money back in a large portion of downpayment.

Before we started getting into investing in real estate, we were looking for something more. I was 10 years into my career and I'm okay. What else is out there? What other opportunities? What can get me out of this corporate life? We found real estate investing. We met a guy, Andrew Brennan, if anybody knows that name, the guy at the time at 88 doors, 44 duplexes. I ran the math on what that looks like in terms of wealth and in terms of cash flow, mortgage pay down their appreciation. I'm like, it was a new art moment. From there, we started coming to events like this. Learning, like reading all the books, meeting all the people, networking and from there we tested it once and proved a strategy and then scaled it from there.

In 2014, 2015, we started hiring people on earth, on property number three. We ended up with seven properties in 2015. We did 20 properties in 2016. in 2017 we did 32 properties. 2018, we actually ended up, we recounted, we did 25 properties in 2018, and that's when we spent six months on the boat in the Florida keys and in The Bahamas. 2019, we're still going. We got a whole bunch of awards throughout the time, and this is amazing to recognize.

There's only so many different places where you can get recognized in this industry. This was one of the routes that we took. This was right before we started with Daniel. In that first conversation that saw Daniel literally take almost every award home he was stacked here. I remember Kristy coming home telling us. Who has big goals? Absolutely, our goal is to have a hundred units this year. And just because I want to tell you this, just because it gives context, but it also holds me accountable.

I'm not just here. We're not here to stop. We're not done. We're going to keep going. We want to add 200 units to our Live with BK Property Management, big goals. That's how scaling starts. That's how creating wealth for you starts. You need a goal before you start. Daniel said, how did you get to a hundred, almost a hundred properties in four and a half years? That's insane and people ask us this all the time and it comes down to these three aspects. Kristy is going to talk about systems next, but the other two key factors that we can really contribute to our ability to scale our business are hiring and empowering people.

If you are one person you could only do one person, one person do, if you create a system and coach and mentor 15 other people, you should be able to do 15 times the amount of work. Hiring, empowering people is by far one of the best ways that we've been able to scale our strategy. Recycling of capital, it really gave us the ability to scale as well. I'm going to dive into these two aspects. I'm going to leave Kristy right after this to talk about systems and systemizing your business.

Scaling your business. What is setting the stage to enable and support growth of your business? You're not just spinning your wheels. We could all go buy 20 properties tomorrow, possibly. What do you do in six months? If you don't have the backbone to support those properties. If you don't set the foundation to your dangle blocks at the bottom, it's going to tip over. There's a lot of work required to do at the starting stages of your investment career. If you're just starting property, number one, two, and three, start thinking about this stuff now. Because maybe in two years you didn't realize it, but maybe you did decide you're going to buy a hundred properties.

The work you do in your first 10 properties is going to pay you dividends when you're at a hundred or when you're at 20. It requires planning, requires staff. It requires funding, joint venture partners. We can't buy all the properties we want with our own money, with our own mortgages, it takes some technology systems and processes. It does take a little bit of a sense of urgency. I thought the market was going to come down in 2017. That was the year we bought most of our properties because we never thought, maybe we can't. We thought maybe, next year, they're all unaffordable. Maybe they're not going to cashflow.

Buy as many as you can. That says urgency keeps you rolling. Why do people scale their business? One helping others. It is pretty amazing to be able to feed, give and create jobs for people. You can create places to live and you create freedom for other people, other investors. Like our employees, they're very well paid. They all travel. They enjoy the free fruits and freedom that we do as well. They're also our joint venture partners, a lot of our staff. Number two, you can bring a great service or product to serve it to the market. Joint venture partners by scaling that creates a great opportunity to have your investors opportunities that are otherwise sought in other markets. And also great housing options.

Number three is probably why everybody else would think. Why does the scales obviously have money involved, right? So it's about money, but it's not all about money. It's about money, but it's not all about money. Money is the code for freedom. The more money I have the freedom to do whatever I want. Does that make sense? Yes, you need money, but the money creates freedom. And I want more freedom. Who wants more freedom? Yes. It gives you the ability to work on your business and not in your business.

By far, we are not perfect at this. We actually had a coaching lunch on Tuesday because we still feel like we're spinning our wheels, but because we're always trying to get better at systemizing this thing and making it scalable, that's why we scale our business. Ability to work on your business and not in your business.

It's amazing when you go through the journey of scaling your business, you're going to be in it, and then you're going to hire somebody and it's going to let you step out of your business again, to scale it to the next step. All of a sudden you're gonna find yourself in it again, you're gonna hire somebody else and you're going to step out of it again. It's kind of a bit of a roller coaster going through working in and on your business, that's at least our experience.

Strategy, first thing you need to do when you're going to scale, you need to have a goal. Your goal could be to quit your day job. You could build a lifestyle, build an empire, or you could do your goal could just be to have X number of properties or create X number of cash flow per month or per year extra. Then you could travel more, do whatever. A goal is obviously a target and without that target, you're not going to find the little steps away along the way to get to that target. Picking a strategy. These are the steps. If you're just starting, you need to pick a strategy, you need to prove your strategy and then you need to perfect your strategy.

I would recommend not to flip a house and then do duplex conversion and then do RTO. That's not how you get perfect at something. Pick a shot, you perfect it, prove it. While you're doing that, you need to implement your systems and processes from the start. It's a lot easier to implement processes and systems on one or two properties versus 10 or 15. Strategy is scalable in all markets. We determined while we were going through our first few years, that when we wanted to do 32 properties a year. Barry, our primary market was not not sustainable to find that many good deals that we consider good deals.

Other people consider good deals out there, but our types of deals, we couldn't do that in one market. We scaled to calling Midland and Orillia freight to make sure. Just keep that in mind. All markets, it may be possible that you are maybe reasonable to think that you need to step outside of an individual market to make sure that you can't go.

Hiring people, this is again, one of two things we're going to talk about is leveraging people. This is part of our team. We've got lots of family members. These people have been with us for some of them from the start for about four years since we've been hiring. I'll talk about the numbers in a bit. You cannot scale alone. In my thoughts, my idea is you cannot scale alone, no single person does anything great alone. It takes a team.

For example, Kristy and I honestly believe that without Kristy and myself doing something like doing this together, we would be divided. She has her role in the back. She deals with the back office and the management, and then the ladies in the office. There's a lot of administrative responsibility. I look after the acquisition, the joint venture relationships and the renovation team. It's impossible for me to do both roles.

In-house staff, I believe in-house staff does give you the ability to scale and it gives you the ability to control the costs. How fast things get done, a whole bunch of other stuff. I'll talk about that a minute. It's joint venture partners. If you want to buy over, like I was making $120,000 a year. If I wanted to buy over 10 properties, you had to use joint venture partners. Keep that in mind.

Before you run out of money personally, start offering your services to investors. It gives you a great advantage when you have the ability to close, but always can rely on an investor. It's a good advantage. Obviously, you need your power team of professionals. We all have that. Your accountants or lawyers or bookkeepers, your renovators, all these teams, these power team people, you also need that.

Good delegation or higher, if you don't personally change the outcome of a task delegated that you have to take that home. If you don't personally change the outcome of a task, delegate it. If you don't like the task, you're probably not going to do well at it, delegate it. And then create systems and processes to ensure compliance, be system reliant, not people reliant. This is our team. We have two companies with 15 people.

We have a renovation team, we have two project managers, seven renovators, and our labor is paid by renovation costs. We actually have very little overhead. We almost have none. It's a scary pack at first, but it's also scary you're not to have staff. You know what my trainer said, he was about to hire another trainer and he was just like, oh but what happens if I can't get them enough work and it's another mouth to feed. Absolutely, it's terrible. But you're going to figure it out cause you have to, just do it and figure it out.

Give responsibility to people. People love it. Hire slow, fire fast, take the time to hire the right person. If they're not doing their job, fire them, it's a crappy thing to have to do, but that's the reality. Make decisions quick when you're an entrepreneur. How did we hire? We hired one at a time. And it helps us control the outcome. The staff grow our brand advocate for our growth. And they support our growth. Having staff do this.

Scalable strategy, this is very important and funding. You're going to run out of money. That was going to really impede your growth. Our strategy is BRRRR, so we renovate, we buy stuff, we renovate into legal duplex, triplex, fourplex, or we'll buy buildings and we'll give cash for keys. Update the buildings, refinance it and carry on. We refinanced it. We get all of our renovation money back in generally two thirds of the down payment.

80% of the deals are with joint venture partners. We do 50, 50 each party. Our staff renovate and property manage at cost. That's a value added service to our investors. My idea is half of something is better than zero of nothing. Better than all of nothing. For example, if we purchase a house at 385,000, which we renovated at 60,000, which we do and refinance it to 525,000, which is now going up to 530,000 540,000, then our investor would get all their money back except for $31,000.

They own 50% of the house. Look at the scalability of that. They could buy five houses if they're all similar designs with $157,000. You have one person, one contact, and you can buy five houses for 150 grand. That's what we started out with when we started investing that scalability. You find five of those people. That's 25 properties. Zero to a hundred, hire and empower people. Make sure your strategy is scalable and recycle the capital that really helps. Kristy is going to talk about systems and processes.

We do have a special offer. If anybody is investing in calling Midland Orillia, anywhere up north and you were looking for a property management company. We are offering two months free for property management. Tell your friends, they can use that code 2019. Take a picture of that. It's just a little way to give back for having us on the stage. Thank you very much for having me. I hope you guys got some information out of that and continue learning. Cheers.