A lot of people — especially in their early career — think about jumping right into real estate investing or management. Similarly, people jump to other conclusions like “I want to buy a house,” but without understanding the weight behind a thought like that. Many people are chasing the wealth in real estate (and it’s there!). However, there’s more to it. So, in this episode of the Nick Huber Show, I’ll reveal the truth about real estate wealth, where it comes from, and what you can do to work towards it.
Real estate investors who got wealthy didn’t just become rich overnight or even in the short-term. Let me tell you a bit about a person you may already know — me. As a student, I started a pickup and delivery student storage company: moving boxes for four years. Beyond being in college, my colleagues and I were scrappy entrepreneurs. But that entrepreneurial endeavor generated about $400,000 of capital.
So, what do young entrepreneurs do from there? They raise more capital. Another half-million bucks to be frank. I could’ve taken some of the profits to fund a half-assed investing business and called it “Nick Huber Property Management.” But instead, we used that to build our first self-storage facility — Bolt Storage. In short, we were gaining experience in finance, property management, real estate investing, capital raising, and how to manage risk for long-term success.
But I don’t just want to talk about myself.
Here are five people who generated an insane amount of wealth during their careers:
Scrappy Entrepreneur 1
This is a scrappy entrepreneur I knew from my years in college. He started just outside of college selling T-shirts. He built and sold a successful apparel company for millions of dollars, and then used the capital to buy, flip, and sell big shopping centers. He could have settled for an apparel business, but instead, he chose the hard way. Today, he’s probably worth $30 or $40 million.
Scrappy Entrepreneur 2
This person is a scrappy entrepreneur from my small hometown. He would build and sell houses — running a construction company that did most work in-house. Where is he now? Buying and selling nursing homes for insane amounts of generational wealth.
Frances Greenburger
Now we’re getting into recognizable names. Frances Greenburger is a real estate titan in Manhattan. But his wealth didn’t start from a sweaty startup — it was his dad. His father, an immigrant, created a publishing company and used the profits to buy apartment buildings. Thanks to the hard work of Frances’ father had made enough money to allow him to buy real estate in New York during the 70s (when not many people were looking to buy).
Donald Trump
Most people see him as a real estate baron, which he is. But similar to Frances Greenberger, Fred Trump’s wealth was from home building, which gave birth to the modern real estate giant. Maybe you’re seeing a trend: the money has to come from somewhere.
Sam Zell
Easily one of the most famous real estate investors of all time. Sam Zell was an opportunistic investor who bought up apartment buildings, offices, and other properties. He didn’t start with family money, however. He managed a 15 unit apartment building during law school. That management operation grew, and grew, and grew until he was netting $150,000 annually — then, of course, he got into real estate and made that look like chump change.
Many investors initially got their leg up because of a family business or pre-existing capital created by the family business. But this isn’t the only way to generate massive wealth through real estate.
I’ve seen successful investors with W2 jobs as a backer. But an investor mindset isn’t enough to get you that leg up in the real estate industry: you need to have an entrepreneurial mindset.
I learned about entrepreneurship over time through Bolt Storage, which at the time was just a student storage company. I’ve also learned through a variety of other endeavors that have well over 150 people involved in operations. The value of learning from management is immense. Learning about delegation, team building, talent acquisition, and financial principles will bring you so much more success than just looking at a spreadsheet to see if the numbers work. So, here’s my advice to people who want to buy real estate for long-term investment or to get wealthy: zoom out to the basic entrepreneur level.
The truth about real estate wealth is that you need to think about it through an entrepreneurial lense. Since other people may be fortunate to have capital without making an effort, you need to find ways to build your war chest of cash and capital. If you learn from everything and manage your risks, you’ll be on a better path than most other investors who are trying to get rich without a vision.
While we’re on the topic, look into some other real estate investors and try to find where they generated capital to get started in the industry. Did it come from them or someone else?
To help you get started on your business and real estate investing journey, I’m creating a variety of courses to help you survive and succeed in the real estate industry.
Three Key Takeaways:
- Zoom out and think like an entrepreneur. Not a real estate entrepreneur or investor, just the most straightforward definition of an entrepreneur. Think about how you’re going to build that war chest of capital to generate growth in your future investments — but don’t get ahead of yourself.
- Don’t just look at yourself based on billionaire-wealth investors. More often than not, that money came from a family business they inherited. Start by focusing on yourself and your market, and you’ll be better off for it.
- You need to have a growth mindset to actually succeed in real estate. If failure isn’t for you, then neither is real estate investing. That’s why I made the Nick Huber Show and Sweaty Startup Podcast — to give you tips and to help prepare you for the world of entrepreneurship and real estate investing. In a recent episode of the Sweaty Startup Podcast, I gave a study guide for becoming a better entrepreneur — it’s brief, but it’ll help you get in the right headspace.
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