Nick Huber, founder of the Sweaty Startup, sold his service business in Jan 2021 for 7 figures and now owns and operates a self storage portfolio with 42 facilities and over 1 million square feet.

I was born in Leopold Indiana and went to school at Cornell where I ran track and founded my first company, Storage Squad. My partner Dan Hagberg and I grew that business to 25 major college towns before we sold the business in early 2021. While we were running the service business, we also built their first storage facility in Ithaca NY from the ground up and opened it for business back in 2017.

After selling the company, I then turned my full-time attention to real estate private equity and self storage operations and we began to grow quickly.

Here’s a recent update on our journey so far and what we’re up to now (as of January 2022).

Portfolio statistics on December 31st 2019:

  • 7 properties
  • 97,049 square feet of storage
  • $4,510,000 purchase price
  • $4,732,000 all-in cost basis
  • Annual NOI: $452,000
  • Employees: 1 (me)

At that time we had 1 full time employee in the self storage business. Me. I was answering phones, hunting deals and doing everything while my partner ran our student storage company (which was a much harder job but he’s a badass).

In 2020 we acquired 3 more properties and 126,360 square feet for an additional $4,710,000. We also hired 3 employees to make 4 of us.

Stats on December 31st 2020 (1 year ago):

  • 10 properties
  • 223,409 square feet
  • $9,220,000 purchase price
  • $9,532,000 all-in cost basis
  • Annual NOI: $925,400
  • Employees: 4

2021 has been a wild year. We’ve hired and built out divisions of our company from acquisitions to maintenance to collections to capital improvements to customer service.

We’ve also had a hell of a year from an Net Operating Income growth perspective. What was $925k in NOI in 2020 became $1.6M in NOI (the same 10 properties we owned last year). The entire industry has absolutely crushed (with 25% street rate growth and 15% same store revenue growth).

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And we’ve bought a lot of storage:

Stats on December 31st 2021 (including what we’ll close in the next 10 days):

  • 42 properties
  • 1,086,063 square feet
  • $59,231,200 purchase price
  • $66,132,236 all-in cost basis
  • Annual NOI: $6,315,860 (projected yr 1 on new properties)
  • Employees: 34

Mind blowing stuff. I can’t believe how fast we’ve grown and I’m the one writing this message.

The struggles:

I don’t have a job at my company. Actually, I can’t.

If something is required of me that means it’ll soon be a bottleneck. Because I have a ton to worry about. Not just a small task but the small tasks 30 other people are doing.

So I have to delegate everything and I spend my time hiring and making sure the people we hire are doing a good job. Its going well so far but its hard as hell. Your instinct tells you to jump in and do the job if it isn’t being done correctly. That isn’t an option.

We’ve got a great foundation of employees we’ve built this year. They’ll take the company to the next level, I just have to keep layering in talent and giving them the tools to succeed.

Finding deals worth buying has been hard. I make it sound easy on twitter and on my podcast but I spent a lot of time this year building a dream team of 3 highly paid cold callers + 3 support folks. They work their butts off smiling and dialing and getting self storage owners on the hook for our team to acquire.

Then we built a system for underwriting them and getting offers out in an efficient manner. That was 3 more hires

I’ve worked on structuring our private equity deals in a way that both LPs and us as the GP make good money without selling assets as soon as we add value (which is actually pretty hard to do).

We’ve also structured our management fees in a way we can build a second profitable and sustainable company that works hand in hand with our RePe firm: our management company.

A lot of real estate firms outsource this part of the job – the task of actually operating the properties and dealing with customers. We’ve elected to do it in-house because its our competitive advantage and another lever we can pull to add value to our properties.

We have to do a hell of a lot of work with a lot of employees to keep our buildings clean, rented and our tenants paying on time. 20 of the employees at our company do that and they are divided into divisions with different focuses all working together.

My partner has focused on the operations of that management company – the hard part. I’ve played a role as well and we have some awesome team members who are beginning to do a lot of hiring and training themselves.

For every deal we do 3 parties need to make money – our management company, our private equity company and, most importantly, our investors. We’ve raised over $20m in outside capital this year.

This last quarter, Q4 of 2021, we will have closed on over $30m worth of storage. Our team is slammed and a bit stressed. But they’re stepping up to the plate and doing really well.

The fun stuff:

Our last business, student storage, was a hard effin business. We sold that business in January of this year and focused all of our energy (and capital) on real estate.

It turns out managing self storage facilities, while a lot of moving parts, isn’t as hard as convincing student employees to get out of bed to drive box trucks in major cities doing hard labor all day.

Self storage has less emergencies because nobody lives in our units. You have some time to solve problems before they become emergencies. Unlike if a boiler goes out in an apartment complex, for example.

We’re making money and the assets we’ve acquired over the past 12 months are performing well already, so our investors are excited and we’ve got the capital to go out and buy more storage and our management company is profitable enough to find / hire good talent.

That right there is the key.

We’re building a business that can self-sustain and pay the bills even if we aren’t doing deals. Which means we don’t need to sell assets to make money. Which means we can hold them for a long time and send tax-efficient cashflow to our investors.

It’s better to be in a good business than to be good at business.

Right now, our business is good. Rents are growing quick and everybody in our asset class is looking like a genius.

We bought a 30,000 sf storage facility in a rural town on December 31st of 2020 (less than 1 year ago) for $1.3m. It sat on the market for 4 months even though it was listed with a good broker with good distribution.

10×10 units at that facility were rented for $48 and 10x20s for $70 when we closed. This past week we’ve rented 2 10x10s at $119 and 2 10x20s at $179.

That $1.3m facility is worth about $2.7m now. Eye popping numbers.

We’re doing our best to stay grounded, humble and conservative with our underwriting. The only stress in real estate is self created when a person over-promises on timeline or profit numbers. So our goal is to under-promise and leave our partners, employees and bankers with pleasant surprises vs disappointment.

We know we’re bound to mess one or two of these deals up and we’ll miss the mark, but overall we’re feeling good about the next 12 months with all of these new properties.

Whats next?

We’re confident. My partner and I are investing heavily in our processes and our team so we can grow.

We have 6 properties (another 200,034 square feet) in two new states (VA and NC) scheduled to close in January / February and I’m sure we’ll get a few more in Q1 before we head into the busy season.

I’ll be spending a lot of time chasing down talent, making hires, and training them.

We have about 15 properties with room for expansion along with 3 significant expansion projects we NEED to pull the trigger on right now.

In Q1 I will be building a team that can oversee that construction and expansion. I already have a hire in mind and have been working on selling that person on my company and my vision.

What keeps us up at night?

The bull case for self storage is strong. People keep buying a lot of shit and they aren’t stopping anytime soon. Covid accelerated it and demand is through the roof. Occupancy is up, street rates are booming, and the biz is healthy.

We’re also convinced deep down that 10 years from now the big players will give remote management a shot. That will open up pandoras box when it comes to the value of these smaller class C assets like ours. They have access to the cheapest capital in the world so when they enter the space cap rates may just compress… We want to have 500 stores by then.

But none of that is happening right now so counting on it simply makes me a speculator.

And our LPs don’t pay us the big bucks to be bulls or to speculate. They pay us to protect their money and manage the risk. They pay us to mitigate the downside.

Real estate is volatile because it’s largely fueled by debt. When people can borrow cheap, values go up. When borrowing gets tougher or more expensive, values plummet.

We’re worried about interest rates. If they go up our debt will get more expensive. For this reason we’re focused on cashflow and low leverage on every deal (50-60% loan-to-cost). We don’t want to be hung out on a heavy value add or construction project if and when things start to go south.

So we’re only buying deals that have a good level of cashflow right off the bat. The ideal pitch for us is a facility with high occupancy and sub-market rents.

Everyone else out there is levering up, buying storage or other assets with as much debt as they can get. We’re resisting that temptation. We’re putting a lot of cash in each deal so if a debt crunch comes, we’ll have less of it to worry about.

It hurts our projected returns when we’re putting in almost half equity on most of our deals. Debt is cheaper than equity right now.

More equity and less debt hurts our cash-on-cash returns but reduces risk. We want to be able to survive and hold onto our assets even if rates go up to 8% or higher. Debt yield is the key metric for us.

Not sure what a debt yield is or why it’s important? Check this free course out.

The cumulative debt yield on our entire portfolio is north of 15%. We are ready to cash-out-refi a few properties, but generally we like the risk profile our low-leverage approach puts us in and so do many of our LPs.

We also have a bunch of short term debt right now. Most of the assets we have acquired this year have been on a 3 year term.

My main focus in Q1 2022 will be to find a longer term debt product that can lock in debt for 5 or 10 years.

In 2008 the banks called all the loans that were expiring – so the only people who were saved were those with cash and those with longer term debt. My loans will expire soon so I’m vulnerable. So thats priority #1.

The golden rule of real estate is “don’t run out of cash.” When you run out, its game over. We’re keeping uncomfortable cash reserves because of this – and inflation is killing the value of our cash… But the alternative is worse if shit hits the fan.

Operations is also where we spend most of our time thinking about the future because it’s where the risk is. Can we rent the units at the price we think we can? My partner is an expert at building processes and we have some talented people running the show, but it’s always stressful.

Will the next deal come?

In our business, especially when debt is cheap and everyone is buying as fast as they can, you always think the next deal you’re about to close will be your last deal.

We’ll go on a two week stretch getting offers rejected left and right. We looked at a deal today we wouldn’t want to pay more than $3.5m that the broker had an offer in-hand the first day north of $4m and he thinks it’ll go north of $4.5m. And he’s probably right.

We haven’t had a signed LOI in two weeks and the owners have told our acquisition guys to pound sand on our last 5 offers.

But then the deals always seam to come back around.

New deals always come if you if you keep working hard to find them.

What about the economic environmentCrazy – huh?

It’s not easy for a young and inexperienced capital allocator like me to navigate. Most of my mentors are bullish. Some aren’t. Inflation is rampant. The crisis is still alive in some cities and ignored completely in others.

We made the tough decision earlier this year to use less debt and raise more equity to reduce risk. We have a lot to lose right now and a good thing going.

We are also passing on a lot of higher risk value-add properties with low occupancy, low cashflow right now, but higher long term potential returns.

I believe a good RePe shop finds a way to do business responsibly and generate good risk adjusted yields for its LPs in any environment.

I don’t know which way interest rates will go and I’m not in the business of trying to guess. I’m in the business of making sure our business will be fine no matter what.

If they go up, we’ll be fine and we’ll buy more.

If they go down, our portfolio will add millions in value and buying will get tougher and tougher.

If inflation keeps rocking north of 10% it’ll get interesting. I don’t know what the Fed will do. I don’t know what the board at my bank will do. I don’t know what will happen to investor appetite for my deals.

But I don’t think we’ll lose any of our buildings and I don’t think we’ll need to lay off any of our employees.

We’re excited about the future whatever it holds and think we’re well positioned to add a lot of value to our customers, employees and investors.

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Happy New Year and thanks for reading,


P.S. If you’d like to listen to a podcast that sums up my strategy and more on my story. Check this out.


I strongly believe that 95% of businesses fail because of three main reasons:

New idea syndrome = huge risk, educating customers that you even exist and competing with huge money and venture capital.

Change the world = its not realistic for an inexperienced entrepreneur without massive capital to change the world.

Passion projects = people start businesses based on their own selfish desires and their own interests and not what the market wants.

I believe in looking at the market from an unbiased and unemotional point of view and picking and choosing great opportunities in markets that already exist. I believe in low risk and a 5 year plan. I believe in focusing on value first. I believe in sticking it out when the going gets tough and most others give up.

I like service based businesses over tech and products because the demand is growing fast, the competition is weak and the customers and competition is already there to study.

The rest of my core principles here.

I like to write little startup guides like this and I email them to my subscribers once a week.

As I continue to learn and grow with my businesses, read self help and business books, reflect on my past experiences and consume content from a lot of other smart people I’ll share it here with you. Reach out if I can help in any way!

Should you trust me?

I think you should take what I say as just another piece of the advice puzzle. Talk to a lot of smart people and pick and choose the advice that is right for you and apply it to your unique situation the best you can!

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