In this episode of Grab the Map, Jeff Stephens shares his journey of real estate investing and entrepreneurship. Jeff will talk about his real estate beginnings, what got him into the industry, and his growth as an entrepreneur and investor.
Jeff believes in sitting down face to face with people buying and selling properties. He says that real estate investing is in the world, and there are a million different aspects of it. The part that always gets him going the most is the acquisition process. He developed a belief that the greatest possible chance of both parties getting the best outcomes happens when people get to talk one on one and face to face without intermediaries.
Jeff is more of a long-term hold kind of person. He has been a full-time investor since 2013 and has done part-time for several years before that. Since 2013, he has primarily bought long-term holds along with a few flips and occasional wholesale deals.
The book Rich Dad, Poor Dad by Robert Kiyosaki got Jeff fired up about real estate. During the early 2000s, he and his wife bought their own primary residence. Reading the book taught him about figuring out how to buy investment properties. With the opportunity presenting itself, Jeff extracted some equity in the form of a HELOC and went with his first deal.
Jeff tries to be cognizant that as he is advocating for evangelizing the idea of sitting down with people in their living rooms, he realizes that the first time is going to be scary. He says that you just have to get started no matter what the means is.
When Jeff bought his first investment property, he planned to scale up. His thoughts about scaling are different now than they were during his first investment. But during that time, he was mainly focused on getting the first deal done.
Jeff’s investing decisions involve him picturing a pendulum in his mind. He started from one side of the pendulum, which was very traditional. The more he got interested in real estate, the more he started learning, listening to podcasts, and being exposed to different ideas. The pendulum then swung all the way to the other side, where he was more interested in wholesaling, flipping, and other different things. The pendulum then swung to the middle, where he focused on creativity and entrepreneurship. Jeff then sought to find his voice within real estate investing and entrepreneurship in general.
Jeff realized that there was the technical side of things that he needed to learn. He realized that at that moment that his perfect vision of real estate entrepreneurship was a perfect mix of left and right-brain thinking. It was the technical understanding of structuring deals and other stuff. There was also employing a people-oriented side of negotiation and developing rapport.
Jeff still buys traditionally. He says that he is very involved in creating financing and face-to-face negotiation. He will never put himself in a position where he is reliant on a bank to say yes for him to get his deal done. He decided that he never wanted to be subject to a bank’s decision regardless of his credit worthiness.
Jeff’s long-term goal is evolving, but it involves having $50 million in his portfolio and having 200 quality units. He takes a balance sheet-oriented approach and builds it with his equity. Jeff says that he is currently in the process of converting equity to cash flow and focuses on growth. Jeff continuously explores what he is capable of and challenges himself every step of the way.
Jeff thinks of real estate and entrepreneurship as two different things. He uses the word “investing” most commonly. But he thinks of an investor as someone who gathers up resources and finds a vehicle to place those resources. An entrepreneur he sees as somebody who goes out and creates value and opportunity and the resources needed to fulfill that opportunity. Jeff sees himself as more of an entrepreneur.
[30:17] Jeff says that the best part of entrepreneurship is the person you become in the process. Being an entrepreneur made him create his own paycheck for 18 years. He says that the person you become in the journey is the greatest reward. Jeff’s entrepreneurial journey allowed him to have a great portfolio of properties that he loves and get the raw assets that enable him to convert into financial independence.
[33:56] Jeff says that the greatest investment that one could make is investing in the ability to create agreements with people. You become resilient when you have that skill because everything can be stripped away from you. Having that skill is the best possible position to start over or continue to grow. Jeff wishes that more people would invest in their own ability to make things happen entrepreneurially in the world.