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Will The Economy Rebound? With Jason Hartman

TWS 49 | Economy Rebound


The COVID-19 pandemic has undeniably thrust us into very unfamiliar ground. Economies are crumbling; systems are collapsing; the future remains unknown and unpredictable. With all these things happening, some of the most significant questions anyone wants to know are: Will things go back to normal? Will the economy rebound? In this episode, Patrick Donohoe brings Jason Hartman, the founder of the Platinum Properties Investor Network and host of The Creating Wealth Show, to help him answer this pressing question. They talk about what is going on in the economy and where investors fit in the picture, covering the good, the bad, and the ugly. On to the side of the consumers, Patrick and Jason then tap into life insurance companies and the effects of media in this time of the pandemic.

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Will The Economy Rebound? With Jason Hartman

I hope you are safe. I hope you’re enjoying paying attention to everything that’s going on. It’s quite a world in a society that we live in. I decided to go online and research some of the most frequently asked questions through Google as it relates to the topic of The Wealth Standard, which typically revolves around investments, finance, and entrepreneurship. There was a question that surprised me, so I wanted to have a good friend of mine, Jason Hartman. He’s the Host of Creating Wealth Show as well as 7 or 8 other podcasts. This guy is definitely busy.

I had Jason on because Jason is informed. He thinks outside of the box and I thought it was a great discussion. The question is, “Will things go back to normal? Will the economy rebound?” This episode is a little bit shorter. We spent a few minutes on that and I think it’s going to give you some decent insight into what’s going on in the economy. I’m going to reserve some additional commentary of my own for after the show. If you feel so inclined, go ahead and stick with me until then. We have a ton of resources available on the website and we’re adding more. We have a couple of things that are in the works that I’m excited about. Check that out. There are a couple of free courses as well as other material that’s important to me that I feel will bless you and impact the way you do business and enjoy life. This is my interview with Jason Hartman.

Jason, there’s a question that I’m seeing more and more and it’s understandable because of the environment that we’re in. It’s, “Why the economy will rebound or not?” I think there are sentiments and signals pointing to it not rebounding, but also rebounding. What are your thoughts on that?

Free speech is incredibly important, but the mainstream media has been telling free lies in many ways. Click To Tweet

I think we are in a time where we are going to see the square root recovery or the modified square root recovery. Everybody’s talking about, “Is it going to be a U-shaped recovery with a long valley or is it going to be a V that went down pretty hard and we’re going to come back pretty quick?” Things aren’t coming back. It’s nice to see that faster than I thought, but ultimately, what we’re going to see this type of recovery is going to be square root sign. It goes along, it goes down, then it goes up. It’s up higher. The modified square root is it’s going along, goes down with the pandemic, comes up, but it comes up lower and that’s the recovery we’re going to see. I think we are waking up and we’re just barely waking up to it. This is not just the US. The whole world is going to wake up to a smaller economy than it had before. However, the good news is that there are lots of opportunities for investors, even in that environment with the mass migration to suburbia and all of that stuff we’ve talked on our mutual show.

The other thing is that there are a lot of efficiencies being created in the economy. We don’t know how efficient that’s going to make us, but it’s pretty good. We both were talking about how much more efficient we can be not traveling. That’s terrible for the airline industry, hotel industry and many other industries that are related. For business people, you can get a lot more stuff done when you stay put. That’s the efficiency of remote work, extremely efficient. A lot of new technologies have come up with the needs of remote workers. There are a lot of efficiencies being created too. Will that overcome the disasters that are being created? I don’t know. We’ll see.

I look at the rebound and it begs the question, “Rebound to what?” Is it the rebound to what was before? I don’t think so. In a sense, as you alluded to, it is going to be better but right now, it is in-between when something happens that causes plans or assumptions to not work anymore. What humanity does in times of need, which is innovative, figure out ways of doing things differently. It’s usually better. The outcome of traveling is, “I need to meet with this person. I need to get this deal done. I need to go visit somebody or I need to X, Y, Z.” People are figuring out other ways to do that.

In a sense, more efficient ways to do that. That’s the genius of humanity is they always rebound. Will the economy rebound? Not to the same degree, I don’t think, but humanity will rebound. It’s times like these, especially the extreme nature of what happened, the shutdown and then we have protests and rights. There are a lot of extreme things going on. I believe that it’s the yin and yang. The more extreme, on the other side of the spectrum, it’s going to grow too. It will be interesting to see how it all plays out.

Necessity is the mother of invention and that has certainly been showing a lot lately. No question about it.

I miss seeing you. I miss hanging out with you.

We’re doing it but it is not the same. There’s no question about it, but in a lot of ways, it does create a lot of efficiencies. Look at the size of the industries that have been hit hard from this, the layoffs, the bankruptcies, and the foreclosures that will come out of this. It’s significant. There are some areas of the economy there, interestingly, very insulated. The low-cost necessity housing in my world is insulated. It’s interesting about your business though, which is unique, insurances. It’s one of the most unique industries in the world because it has this unique characteristic, a negative cost of capital. You paid for it before you get it. With most things, you get it and then you pay for it or you pay for it at the same time you get it. In insurance, you pay for it first. Insurance companies have an interesting thing. You’re on the life insurance side, but other insurance is going to be hugely hit. With the civil unrest and all the damage and all those insurance claims, all the business interruption claims from that, but previously COVID and continuing COVID. The insurance industries got to be pretty hard hit from that, but I don’t know about life insurance. Your business is good through all this.

TWS 49 | Economy Rebound

Economy Rebound: The whole world is going to wake up to a smaller economy than it had before. However, the good news is that there are lots of opportunities for investors.


The only barometer you have is when you look at history. They have been able to thrive through some challenging times, World Wars, other epidemics, or pandemics. These industries have been around for a couple of hundred years. It’s similar to your industry where everybody needs a place to live. There’s a median part of the bell curve where that sits a lot of people, tens, or probably hundreds of millions of people.

They don’t need an expensive place to live in a city, but they do need a place to live.

It’s one of those things, whether it’s a building, a car or business interruption insurance, those are micro but from a life side of things, it’s macro because it is everybody and it’s life. These are circumstances that don’t have a huge impact on mortality. I have seen where it is more difficult from a health standpoint to go through and gets certain approval ratings and health ratings. At the same time, nothing else has been impacted. In fact, these are the times where these types of companies thrive because they have a lot of capital and they know how to make a good investment. I would say the best investments they’ve made in the past is when that investor behavior occur. When times are the worst is when they are typically ready to pull the trigger. They have dry powder to do that.

Do you monitor what life insurance companies are investing in? Is that something you look at? Tell us about that. That’s interesting because they used to have office space, office buildings, and shopping centers. Those are hard hit, the multifamily apartment side and they invest in that. If it’s not a high-rise, I think that’s going to do well. You have some social distancing opportunities and not have to go in elevators or garden style.

They’re institutional investors. The deals that they participate in are big. It’s not a one-off multifamily apartment. These are bigger buildings. It could be developments or land. The example I use quite often is one of the companies we work with purchased a huge parcel of land in Boston Harbor during 2000 or 2001. It was during those dot-com crash plus 9/11. They bought a huge plot of land for $100 million and have sold individual parts of that parcel for over a billion. There aren’t many people or companies that can write a $100 million check but insurance companies, these big mutual private companies can.

Have you seen any evidence of they’ve changed their focus that they’re more focused on housing versus shopping centers? It is because the shopping centers and office space will be hard hit, but housing is good. Other assets like the medical office would be pretty good. That will be the one office category that will probably be okay through this. Does it get that granular in your view of it?

Not usually. There are regulations as far as what they can invest in. How much of their portfolio based on the rating of the company because they’re all rated. There are a few different rating agencies similar to how publicly traded companies are rated. They take out debt. Insurance companies are also rated. Based on their size and based on their rating, it gives them some flexibility as far as where they can invest, but it’s regulated. In large part, they have safe assets. I have big positions in the debt of strong stable companies, but they own mortgages. These are mortgages usually on commercial properties and their LTVs are extremely low rates. There’s a default on the real estate that they own. That impacts how they’re rated and subsequently what they can invest in. They do release reports as far as their portfolio is concerned. You can see that on an annual basis.

Let’s flip to the other side of that equation though. What about the consumer side of it? Have you seen these life insurance companies? Are they being more strict from their underwriting criteria? Are they rejecting more applicants? Are they raising their prices for insurance? In other words, that’s a barometer of whether or not they think the risk is higher. What’s going on there?

First off, there are regulations around the mortality expenses. There’s a whole commission that does this, and they usually do it about every ten years. There was one done in 2017. There’s a regulation on that from that standpoint. However, there are different tiers of health that a person can be in and there are all sorts of different criteria. I’ve seen them adjusting those. If somebody is older and has some health conditions, that is something that is a high risk these days given COVID.

They increase the price and they’re declining more people, but the price is higher too?

Price is higher because of ratings. They can adjust how they rate somebody. We have a standard way in which mortality is measured, then you can have a substandard or above standard. The above standard gives you a little bit better rating, substandard gives you a worse rating. The actual standard, they don’t touch because that’s regulated, but the above and below standard, they can.

What else can you tell us about that?

It’s one of those things where it’s a sign that they know how to respond during difficult times. I would say from the economy rebounding or not rebounding, the companies that don’t have the experience of downturns are getting hurt or have overextended themselves. These are big companies. Starbucks announced that 500 locations are going away. Big companies are reacting to it because these events weren’t priced into their business model. Now that it’s there, you’re going to have a different way of doing business.

I’m not sure if wages are going to get hit or benefits are going to get hit. Companies are going to act differently because what’s priced into their business model is something like COVID or some Black Swan event that can come out of the leftfield and disrupt the entire world economy. It was interesting because I got a news flash and it was this guy that was in a silent retreat for 90 days and he just got out. I challenged my daughter because she was sitting next to me. I said, “If I’m that person, talk to me about what went on over the last 90 days.”

What’s amazing is the time perception for all of us, the entire world has changed so much because the news was coming at us quickly. With the civil unrest at the time, the reopenings were starting. It’s crazy. Do you realize the biggest news story of 2020? We thought it could have been what was going on in January. It was the Australian wildfires. Nobody is even thinking about that. Right before that were the Amazon wildfires. That’s out of our collective consciousness and it goes to show you that in some ways, people have a short memory. Collectively, we can’t pay attention to that much. We can only pay attention to a few things. I noticed this whenever I go and kicking back in a hotel room on a trip somewhere.

I’ll let the news play and I do not do this at home. I haven’t even had a TV at home because I can’t handle the commercials and the garbage on it. I’ll turn on a news station on the TV in a hotel room a lot of times and let it play. It’s like the same stories over and over all day long. If you’re there for a conference, you go to the conference in the morning, turn on the news, come back, turn on the news. It’s the same stories. It’s just a repeat. I think to myself, “Isn’t there anything else going on in the world?” There’s way more, but maybe they’re lazy and they don’t cover the other things or it’s that people can’t perceive any more than that. It’s entirely possible.

These are times when people think differently. That’s why the questions that we have been answering are important because there are different questions that may have not been asked previously to COVID. If you look at the disruption, there’s more questioning of media and people are asking themselves about time, “Is that true? Is that perspective right? Is there another perspective and trying to form that?” Media has the majority of people’s attention and that’s where they get influenced and then because of our upbringing and most people in the public school system, we’re taught to listen and to obey in a sense, and we have to do what we’re told. People are questioning it these days. I think that’s a good thing because there are other forms of media, news, and ways in which they can validate what’s true and what’s not.

Sadly, those ways are being censored by the big disgusting tech companies. We are on one of their platforms and it’s scary. Love them or hate them. I’ve got to tell you, Trump has made some good points about the media. They have an agenda. This is not about free speech. Free speech is incredibly important, but the mainstream media has been telling free lies in many ways. It’s biased and ridiculous. They are dividing people more and it’s awful. We’ll see what comes of it.

There are two kinds of converging forces within an individual that fuels it. The first one is people hate to be wrong. If they’re wrong or challenged, they resist and they fight it. The other one is people hate being deceived, lied to, and told mistruth. It’s like you have this convergence of these two powerful forces. In the end, humanity in a sense always prevails. It’s a matter of time and everything else has to happen.

It takes a long time, though sometimes to work through those cycles. Unfortunately, it does, but we shall see. The upshot of this is my opinion is modified square root recovery. We’re going along, the economy was booming, went down, and coming back up. We’re going to come up less than before, but the good news, some efficiencies have been created. We’ll see how those pay off over the coming years. Your opinion I think is somewhat similar to mine, but what do you think?

Sometimes, we have amazing learning experiences from challenging times, yet we try to position our lives never to have them. Click To Tweet

It is. At the same time, the variable that I’m concerned about is everything is fueled by credit. If credit contracts, that’s going to negatively affect the economy. I look at how do you measure the economy. The economy will rebound and rebound is a function of measurements. You’re rebounding to a certain measurable level. I believe that paying attention to the fed, what they’re doing, how they’re stimulating expansion, and contraction of credit. It’ll be interesting to see how that plays out because that’s going to be a variable. It may make some of our assumptions invalid. These are the Black Swan variables who knows what’s going to happen. At the same time, long-term, I agree with you. The economy is going to be even better because it’s going to be more efficient. There’s going to be less waste.

Everybody, happy investing. Thanks for reading.

Thank you, Jason.

I hope you enjoyed that short interview with Jason. He’s a great guy. Check out his podcast, the Creating Wealth Show. I believe he does a couple of shows a week and he has 1,200 or 1,300 episodes. This guy is a machine and smart. We just scratched the surface. He’s been on the show before, but if you guys have not had a chance to follow him, I would encourage it. I want to comment on some thoughts I’ve had as I’ve reflected on our interview as well as the question that was posed, which is, “When things go back to normal?” It’s been interesting living through this. I think we’re going to look back on these times and appreciate them and see some change and growth in us, hopefully. It’s different than what anyone anticipated.

I’ve been thinking about the idea of challenging and difficult times and in hindsight, I think we see how they’ve changed and helped us. Oftentimes, we don’t go into those difficult times with that attitude and perspective. I believe that it is an opportunity to do that. Something I’ve talked a lot about on the show is how these times refine who we are, help us understand, and grow. Without challenging times, I don’t see how much growth is possible. It might be marginal at best. This came to an important discussion in my family, specifically with my two daughters. I think that most children who grow up in the United States, if you compare the United States to other parts of the world, whether it’s third world countries in Africa or the Middle East, India, as well as Asia, I look at sometimes how we have this amazing learning experience from challenging times, yet we try to position our lives to never have them.

It’s interesting how that works. I’m not going to say it’s a paradox, but maybe it is. I realized something in relation to my daughters because they’ve experienced this shutdown and it’s different. At the same time, I look at it being a challenge. It also is an environment where you can as easily complain about and sit back and relax, and except the paycheck from the government and not do anything. I believe I know why that happened. I believe that we have the biggest opportunity cost when you paper over challenges, especially these Black Swan challenges because humanity thrives during these times. It’s not always in the moment, especially in the beginning moments, but as we figure things out and we find solutions and we innovate, things become even better.

There are going to be instances of that because lots of companies are failing, going bankrupt, and weren’t prepared. There are going to be some valuable lessons learned from that, which is good. I look at my kids on how they interact with me, their little brother, and others. For the most part, they’re incredible but I’ve noticed lately a sense of entitlement, a sense of selfishness, and a narrow perspective of life. I wouldn’t expect them to have a broader perspective because they haven’t experienced challenging things. Those of us who live in the United States who benefit from many things that we take for granted, as you compare us in our circumstances to the rest of the world, but yet you still find yourself complaining, getting frustrated, and irritated.

I’ve stepped back and I’ve looked at what an incredible time that we live in and what an incredible opportunity for me to be more aware of who I am and why I’m in this situation. The first thing I did with my girls, I wrote them a letter about their mom. Even though the content of the letter is known to them, I wanted to put some emotion into it. That letter was telling them about their mom. My wife was on here a couple of years ago and we discussed some of this. She grew up in some horrible circumstances in Mexico. It is a very poor city. She lived in a cinder block home. There were only three rooms, a cinder block or concrete floor, and a small shower. She never had her own bedroom or bed. She always slept with the brothers or slept with her mom. Her dad wasn’t around. He was working outside of Mexico.

TWS 49 | Economy Rebound

Economy Rebound: The time perception for all of us in the entire world has changed so much because the news comes at us quickly.


She had to be an adult at a young age cooking, cleaning, taking care of her brothers, helping them with their schoolwork, but she did it. She did it her own and she got good grades. She accomplished some pretty amazing things. She didn’t have anything. She didn’t have Christmas or birthday presents. They didn’t have food that often and she doesn’t talk about this at all and I’m reluctant to talk about it either. The point is those challenging times, put her in a position to either accept to be happy with them or to shrink. Those circumstances and experiences of life impacted her in a big way and formed her into the woman she is and their mom. There are a lot of other things I talked about in this letter.

The point of me talking about this letter is to give a different perspective of life on an intimate level because it’s their mom and to show you how difficult challenging times help and change us. Whether it’s talking back, refusing to do things, being dishonest, or treating little kids, especially six-year-olds who have way too much energy. They can be irritating sometimes, but it’s to be composed and patient. As I thought about that and about myself and thought about you as readers, it’s looking at the world and recognizing that these are experiences that we have no control over, but we do have control over how we act and how we show up.

When we look at the world in hindsight, by asking the question, “Will things go back to normal? Will the economy rebound and go back to the way it was?” We missed the point because whether that’s true or not, it’s the wrong question. I think the perspective to take is, “How am I going to do better, be different, and help more people be a better steward over my circumstances?” That’s what I’ll end with. I started to approach life a little bit differently where I recognize that life may not be coincidental. Life may be by design and the people I meet and interact with every day, maybe for a reason. Whether that’s true or not, I probably will never know. What occurred to me is knowing that I can show up in a good way every single day, every single moment, and enjoy it. Whether it’s smiling to a stranger or helping somebody, reaching out to somebody, or sending a text. There are a lot of people that are in need.

A lot of people that are lonely these days, but having a perspective of making somebody’s day better, making my team’s day better, inspiring, and motivating. Finding the opportunities to do that has impacted me in a good way and a positive way. I believe that’s possible for all of you. It’s looking at your circumstances and looking at what you’re going to experience tomorrow the next day and realizing that in those moments, the people that you meet and interact with that happen across your path. There could be some amazing opportunities there. I believe we have a stewardship to show up as the best person for those moments.

I believe that it is by design and that’s how I’m operating. It’s been awesome to observe. We look at some crazy times and I hope things don’t go back to normal. I hope we all are better from this. I hope we innovate. I hope we find new relationships. I hope we seek out experiences and do things differently than what we would have done in the past. I think if we show up as the same person after this, we’ve missed a big opportunity to grow. That’s all I wanted to share with you. We have links to Jason’s podcasts as well as any other links that we talked about. Also, check out the website. Make sure you bookmark it and subscribe to the newsletter. We’re emailing weekly. Thanks for reading.

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About Jason Hartman

TWS 49 | Economy ReboundJason Hartman is the Founder of the Platinum Properties Investor Network and host of the Creating Wealth podcast, which is heard in more than 180 countries. Jason is a genuine self-made multi-millionaire and serial entrepreneur who owns 21 businesses in investing, financing, real estate development, and SaaS software. He has owned properties in 11 states, had hundreds of tenants, and been involved in several thousand real estate transactions. He has visited 83 countries, enjoys adventure, fitness, and lifelong learning.
Jason Hartman is the host of 23 podcasts with listeners in 189 countries, over 15,000,000 downloads, and over 5,000 episodes where he shares powerful strategies for business, investing and living the good life. Check out his podcasts and resources at or Available on iTunes and your favorite podcast platforms.
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Royalty Exchange As A Unique Investment Class With Matthew Smith


TWS 37 | Royalty Exchange


In these times of volatility, it always helps to find other investment opportunities to diversify. Sharing in this episode a unique class of investment that does not really exist anywhere is Matthew Smith. Here, Matthew talks about his company, Royalty Exchange, and how he stumbled upon the royalties niche and created an online marketplace and auction platform where investors and artists can buy and sell royalties. He gives us a view of what goes on in this type of non-correlated asset investment and explains how it goes about intellectual property laws as well as the global demand and consumption for these different types of media. Bringing to light the current situation we are all facing, Matthew then gives his thoughts about the economic reality of the world and why it could open an opportunity for your business to restructure.

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Royalty Exchange As A Unique Investment Class With Matthew Smith

I have a special guest. His name is Matt Smith. He’s the CEO of Royalty Exchange. Matt has been a mentor of mine for years. He was my formal business coach for the better part of three years and one of the smartest in business that I know. He has a cool business. Talk about a non-correlated asset investment and a unique class of investment in and of itself which doesn’t exist anywhere. Matt’s background goes into a lot of entrepreneurial ventures including publishing companies. He’s bought and sold many, as a partner in many, has a brilliant marketing mind. He’s also a passionate, free-market advocate. His venture is dedicated to one of those demands in the marketplace when it comes to an income stream that comes from royalties.

He is facilitating a company in a way to monetize that where it makes sense for an investor and the intellectual property owner. You are going to enjoy it. He’s really smart. Follow him on social media and sign up for a Royalty Exchange account. You can see how cool the platform is and this investment class. I hope you are doing good in relation to everything that’s going on. I know it’s crazy out there. I hope you’re safe, healthy, and happy. It’s one of those times where we realize the value in things that we take for granted and I’m grateful for this time. It’s challenged me from a business standpoint and from a personal standpoint. I hope you are looking at this as being a great opportunity to grow. Hang in there, enjoy the show and we have a lot of cool episodes coming up as well. Stay tuned for those. Here’s my interview with Matt Smith.

Matt, it’s awesome to have you in. Thank you so much for taking the time to do this. 

It’s my pleasure.

I have tremendous respect for you and what you’ve done in business, what you’ve taught me personally. I’m excited to interview you because we’re in the times that we haven’t experienced before because of the global nature of things and how interconnected we are. There’s news all over the place and we’re hearing tons of information, good and bad. I’d love to get your take on that first and then get into what I feel is an amazing company from what you’ve built and it is super niche. It’s one of those investments and businesses that people know about the idea at the same time, being able to turn it into some an investment opportunity is quite something else. First, you’re plugged in and you’re an intuitive person, a deep thinker. How do you view markets as they stand? What’s going on in society? The huge volatility swings with what’s going on, what’s your view on that? 

The major issue that’s going on has to do with the Coronavirus, but my view is that is not the cause of all the market volatility. It’s adding to the concerns that the market is trying to deal with but there was deeper toxicity within the system already that’s been there for a while. It’s a credit bubble we’ve been building for a long time. The pin has pricked it and all the wild swings are the market trying to find some sense of value.

It’s been amazing how quickly it’s gone. It’s surprising to me, it’s like these huge corporations but then it’s like, “We need a bailout. We need money.” It’s just ill-prepared from a number of different perspectives. 

That is one of the most shocking things. Is anyone in America ready to go a month? Nothing has happened yet at this stage in America, not serious at all yet. Everyone is screaming for bailouts and it shows how ill-prepared everyone was. There’s no resilience whatsoever. In the most families balance sheet certainly but definitely in none of these huge corporate balance sheets at all is unbelievably awful the way they’ve been managed.

It’s interesting to see how well-prepared the government was to figure out a way to spend $2 trillion. I would challenge anyone. You have a day to figure out how to spend $2 trillion, go. 

It’s going to take 1,100 pages.

Things have gone bad, but we're a society that believes in the opportunity for renewal. Click To Tweet

They were prepared to do that but they weren’t very prepared to do anything else. 

The markets are a place that you prefer not to be involved with if you can help it because their situations may not have a choice. The volatility is going to continue as the market tries to digest everything that’s going on in the world of what the economic reality will look like. All the big companies have moved guidance. You can’t value a company on P/E ratio. No one has any idea what the E will be at all. A lot of things are out the window and it’s a very uncertain time if you’re a stock market investor, that’s for sure.

One thing that we haven’t discussed in the show and you’re versed enough to maybe talk about it before we get to Royalty Exchange. The word, buyback, is a big part of this stimulus bill and preventing buybacks. People understand dividends. They understand big bonuses to CEOs. Why is buyback in there? What does it have to do with the credit bubble that you mentioned?

Stock buybacks in and of themselves, there’s nothing wrong with. In fact, it can be very good for the investors in those companies but like most tools, if it’s abused, it can cause a lot of damage. Because of the way that the taxation works in these corporations, if you’re looking at, “We can do a dividend distribution to our shareholders or we can buy back stocks in which case increase the per-share dividend that everyone’s getting.” They choose most often to do these stock buybacks because it’s more tax-efficient and investors usually celebrate that idea because it’s fundamentally good for investors. However, it’s executive pay packages that these supposedly the leaders of these big companies have had are usually connected to stock price. One way to make sure that your price goes up is to take a lot of the stock out of circulation.

The stock price goes up because there are fewer shares but no improvement to the corporation has been made. Meanwhile, if you’re doing that especially at the expense of preparing for a rainy day, it’s absurd that Boeing is going to shut down and then that CEO comes on and says, “If there are any restrictions on any benefit from you, we’re not having anything to do with it.” I was like, “Great deal. Sell your stock to the public market. It’s a raised capital like any other company you’d have to do.” Stock buybacks aren’t bad but they were abused and they were given preference over, they were making investments in the long-term or preparing for a rainy day.

That’s coming back to bite companies in a serious way. The one thing that reveals what we’re talking about though about the underlying toxicity in the market relating to stock buybacks is that all of the improvement, the increase in share price over about the last eleven years and the S&P comes from stock buybacks. If those companies weren’t buying back their shares over that time period, the S&P would be the same level it was 10 or 11 years ago. It makes you wonder what was even happening in the market if it was the corporations using all the cash that they were generating to buy their own stock, it was a giant financial exercise. It didn’t serve anyone very well.

It’s the unintended consequence of low-interest rates. The theory behind low-interest rates is that people will borrow and be more productive. With corporations, they would take on big corporate debt at low-interest rates that pension companies would buy or other big institutional investors or sovereign funds would buy then they would use it not to increase the value of the company by innovating R&D infrastructure, they would buy back their stock with it.

Even Apple who has something $250 billion in cash. A big part of it is because a lot of that cash is overseas and then if they brought it back then they’d have to pay taxes on it instead, they sell bonds and then they use that debt to buyback their own stock. This financialization of the world has not been good for the world.

There are those that have incentives to do it. You had mentioned that before, keeping shareholders happy, maintaining a dividend level, maintaining a consistent growth and their specific benefit and incentive packages. At the same time, it’s put them in a pickle because they have big debt payments. If they start to go down in value, that’s ultimately not going to be good. That’s interesting to see how this all shakes out. 

It will be very interesting to watch.

TWS 37 | Royalty Exchange

Royalty Exchange: There is nothing wrong with stock buybacks in and of themselves, but like most tools, if it’s abused, it can cause a lot of damage.


At the same time, sometimes failure and even bankruptcy, most people think bankruptcy is the company goes under and they’re no longer around. The bankruptcy is simply restructuring and settling with predators. It’s healthy for a company sometimes. 

Bankruptcy laws are designed to preserve the assets and to preserve the capability to be productive but basically wipe out the capital structure in the organization. I was talking to someone else about this and they hear these threats about the airlines going bankrupt. I said, “Did you fly in 2012? All the airlines went bankrupt during that time period but they didn’t cancel flights.” They didn’t fire the employees. The planes kept flying but they went through a bankruptcy where they restructured all their debt, they restructured the equity. That’s what they should be doing again. They’re putting fear into people that bankruptcy means it’s the end. It’s trying to protect this investor class. It’s a big mistake.

The definition of that word needs to be understood. It’s equated to failure and obsolescence than it is to a good thing to restructure. You hit the nail on the head, the capital structure. The capital structure of most companies, they want to stay relevant. It has to include a lot of debt. 

They can’t survive on it. I was talking to this person about this, I said the same thing with personal bankruptcy. It is seen as a black mark and a failure. If you get to that point, things have gone bad but we’re a society that believes in the opportunity for renewal. It’s the opportunity to do it over that you aren’t condemned forever by something. There are consequences for filing for bankruptcy but when you come out of it, you come out with a chance where there’s hope that you can be productive and contribute again. They’re there for a reason.

The quicker you can start the process over, the lesson’s done if you keep prolonging the inevitability of failure. You’re not going to be able to start the cycle over again or to learn the lesson and apply it to have an even better business. 

The bottom line is it’s supposed to be a good application of capital. You deploy capital in productive uses, then you’re rewarded for that use. Bankruptcy is supposed to breakdown the misallocation of capital. We make it so that the new people can come on and use those productive assets and do something with it. It’s an important part of a capitalist system. It’s not that we’ve had exactly a capitalist system for a while but it proves it again that it’s less existent than ever. Our first instinct is to bail everyone out right away.

The best thing would be for some of them to fail because it would replace leadership, it would put better people in there, and more innovative people in there. That’s healthy because that’s one of the worst things. It’s the whole moral hazard idea where morally, we learn when we fail. That’s a good thing because we’re better and we’re stronger when you prevent that. People don’t learn the lesson they should have and that means that they’re going to have to learn at some point in the future. It’s going to be bigger.

In many ways, if you’re a parent and you don’t allow your child ever experience any negative consequences for anything that happens in their life. Are you helping them or are you hurting them? Negative feedback is a gift and it helps us adjust to course-correct and make better decisions in life and be more successful. It’s critical and moral hazard is everywhere.

One of the guys that formed an affinity toward is Ray Dalio and he’s a successful guy, big hedge fund guy. He wrote a good book called Principles. Principles relate to business and they relate to your personal life so I respect him. One of the things he says from a financial standpoint is when you’re making an investment, you want uncorrelated investments as many as possible. I would say even though you have different sectors, classes of investment on a trading floor or an index, you still have these shifts that regardless of the sector or the industry will fluctuate with the tide. He talks a lot about the idea of uncorrelated assets.

He also has an amazing video. It’s called How the Economic Cycle Works. It’s not the philosophy of it, which is interesting. Most people have a philosophical approach to how things should work but he talks about how it works which is fascinating. Going to the uncorrelated investments because of how cycles work, there are opportunities when things go down and opportunities when things go up but they may not be in the same class of investment. That’s why I wanted to bring you on, and maybe you can comment about Ray Dalio and about economic cycles. I want you to talk about the niche that you discovered, which I would say is an uncorrelated investment that I don’t know if there’s any other platform or other opportunities to own it but through Royalty Exchange.

If you keep prolonging the inevitability of failure, you're not going to be able to start the cycle over again. Click To Tweet

Ray Dalio is brilliant. He has had the longest untarnished record of investment of anyone. It’s quite impressive and his book is very good. I also think that he has a children’s version of that. There are some good points for people and my kids have read it. He’s got a lot to teach us, that’s for sure. The market’s activity is shown how correlated everything is especially if you haven’t been in the markets for a while. We’re surprised that the gold got crushed at the same time as everything else. In 2008 that happened too for a while at least. When there’s a demand for dollars, everything goes down. Everyone needs liquidity. The point about correlation and where Royalty Exchange fits into that is what our business does is we work with one-side artists. It’s almost all in music although we’ve done a couple of things outside of that.

These are typically songwriters often for major acts for major artists who know and love. It’s the music you listen to on the radio, but behind that artist are often several songwriters who craft the work. They earn royalties on the use of that music in the same way that the performing artists would. In some cases, in a better way than the artists would. Any song, every time it’s played on Spotify, radio or whatever, there are royalties earned for these different rights holders and it generates substantial income for those artists. If you look at Spotify for instance. If you want to go look at a publicly-traded company that is focused on the music business, you’ll see that something around $0.70 in revenue they bring in, they have to pay out to the rights holders. That would be the labels of performing artists, the songwriters, the publishers that own the IP.

Their cost of goods sold is incredibly high for that business especially because of the boom in streaming over the last several years, it’s been good for rights holders. It’s used to be in the music business that music almost all of the revenue is generating music business was from new work, from music that had come out and out for less than eighteen months. This changed because of streaming and more than half of the revenue that’s created comes from what the music industry calls Deep Catalog. Deep catalog and music businesses are only music that’s been out for more than three years. That’s how short-term thinking they typically are. For instance, Dire Straits, if you remember who Dire Straits is, they haven’t disbanded in the mid-‘90s. It’s a long time ago and yet I own personally some royalties on their music and my portion of the royalty income grew 12% in 2019.

Even though the band hasn’t been performing forever that the music is old because of exposure on these streaming vehicles, it’s generating more and more income. It’s the rising tide with the music industry essentially. In any case, what we do is we work with artists who own these rights on one side but have a need or desire for a lump sum payment for it instead, then we work with investors who are looking for yield and match them up in our marketplace. That’s what Royalty Exchange is all about. We were talking before about market correlation. Most of the royalties that we sell on our platform are what’s considered songwriter public performance royalties. That’s a whole specific class of music royalties. I could go into more degree than anyone is interested in about the different slices of royalties that are there. We looked at that specific slice in particular and we looked at the income that’s produced from that or paid out to artists for that during the last major market downturn we had during the financial crisis.

We compared the growth and distributions to rights holders, compare that with the growth in dividends within the S&P 500. There is no correlation there at all. Dividends from S&P companies during the financial crisis shrank because they had to cut dividends to save capital and all that. They continued to grow throughout that entire period from music royalties. There are a couple of reasons for that. Part of it is that the consumption of music isn’t fundamentally altered by that activity. That wasn’t related to the financial markets. The second thing is that there are long-term contracts, the licensing agreements that exist.

The radio stations and all of that have these long-term licensing agreements with these public performance companies. There’s a multiyear delay. If their ad revenue is shrinking, they can’t justify as big of a licensing deal with these performing writers organizations that represent all the artists. What happens a few years after the downturn has happened, they renegotiate a new deal that’s under slightly better terms but it often works perfectly in terms of the market correlation. Once the market catches up with that downturn, the contract is already there and it continued to be paid out among those old terms which were created during the good times.

I would look at a potential inverse correlation because you’d think that when things are going down where there’s a correction recession, people would want to be lifted up by listening to music or increasing their entertainment. Was there any inverse correlation based on that?

It’s hard to know if the consumption increased during that time period. The general business was in a decline. The music business was in a big decline after the introduction of Napster in the year 2000. That major crosscurrent happening. You also had the rise and there were digital downloads through Apple Music or iTunes at that time. Streaming was starting to come in the very early stages. There are those major crosscurrents, it’s hard to see there. I will say I did see some information showing that streaming consumption went down. This is the first period where what’s the turmoil that’s happening in the United States. That doesn’t substantially affect most of the deals that happen on our platform because of the specific rights that we sell on our platform. That’s because people are staying home and they’re don’t have a commuting time, maybe it’s cut there. It wasn’t a huge decrease but there was a little bit. Maybe a rose is watching the news to figure out what was going on in the world. It had been that but we do see from 2008 that the distribution starters continued to grow while distributions to investors and S&P shrank.

Are you paying attention to how intellectual property and royalties will work globally? Is there any traction there or is that a throw out given the complexity of every country’s intellectual property laws? 

It is deeply complex but there are organizations that are set up in every country around the world that manage the use of intellectual property within that country and the agreements for use by people in other countries. If you think about Spotify, for instance, how they waited for a long time before they finally did pull it in the US. It was because of these unique territorial licensing agreements that had to be worked out with the music labels at that time. International is a strong component of royalties that are earned. One of America’s great exports is our culture film, TV and music. A big portion of the royalties that are created are generated overseas.

TWS 37 | Royalty Exchange

Royalty Exchange: One of America’s great exports is its culture—film, TV, and music.


There was a presentation I saw and it was Peter Diamandis who was giving it. He was talking about the growth of people coming online and it’s going to double in the next couple of years because of the satellite infrastructure that’s going in place. You’re right, it’s one of those things where whether it’s TV shows, movies or pop culture music, the more people that are online, the more people are going to have access to it because more underdeveloped countries don’t have the structure in place to create the songs, not necessarily have the ability to come together as multiple artists with that organization to you get the same quality. I think you have some protection there. It’s also interesting how the global demand will increase and improve royalties as well. 

The other thing I would say is that you might be familiar with Techstars, which is a technology incubator. They have franchises all over the world for different sectors and there’s one for music. We’re one of the sponsoring members of it meaning we contribute capital to fund the different startups that are going through the incubator. Alongside of some of Warner music, Sony Music, Sony Corp Innovation Fund is in there and lots of other people in the music business. The music industry has a bad reputation. It probably well-earned in part for not being innovative when Napster came along for missing that and then not adjusting well to it and got dragged kicking and screaming into the streaming world.

It doesn’t seem that’s what’s happening anymore. It seems like they learned. I’m working with the different companies that are coming through the Techstars incubator. You can see that they’re constantly looking for new ways to license the music, license the IP anywhere they can whether it’s new consumer apps like TikTok. Your kids or grandkids and the people reading this know what that is. It’s been huge and driven a lot of new royalty income for rights holders that didn’t exist a year ago but it’s a big source of revenue. In gaming licenses for within video games, all of that’s happening. The music industry is finding new ways to bundle in licensing opportunities with music into other experiences. It is also proven to be a significant driver for ongoing royalty revenue.

My mom was a music professor and I grew up around music. My brother is a professional artist in Vegas. Music is one of those things that I’ve come to believe is a part of life. It’s part of what motivates us and what gets us through things. It’s cool to see how businesses are innovating ways to bring those opportunities, bring music to more people and finding innovative ways of doing it. If you look at all the different technologies that are coming soon, AR, Augmented Reality. Maybe VR gets a second wind. Anything new like if it’s just it without music, it’s not the same regardless of what the technology is. 

I’ve said to people, “If you ever do a video of yourself, you’re filming yourself doing anything and you feel like you looked silly, slowed it down and add a soundtrack, you could make anybody look a hero.”

If you put like 30 settings to the 23.98 frame rate and then you put some music to it, you look like you’re a movie star. 

The music invokes things in us, we don’t realize even so it’s huge. There’s a lot of innovation happening around it maybe it was late to the party but they’re doing a good job and that’s going to create ongoing sources of earnings for rights holders.

Going to the Royalty Exchange platform, it’s not the primary artists. It’s the one that’s on the title of the song. 

A lot of times, it’s not the performing artist.

It’s the songwriter or one of the musicians that’s playing an instrument. They have these streams of income coming in. They sell that stream of income on your platform for a lump sum. They need money for whatever purpose. 

A negative feedback is a gift, and it helps us correct our course, make better decisions in life, and be more successful. Click To Tweet

A lot of people go, “Why would they sell?” You have to understand. These are the original gig workers. You’re talking about Uber drivers and people like that that are unbankable, meaning if they want to go get a mortgage for their home, it’s difficult. Musicians looked like unemployed people. Songwriters look completely unemployed. Their access to capital than out of the capital markets doesn’t exist. With all of us, a little bit of injection of cash at the right time in your life can have outsize gains in productivity and what’s possible in our careers and futures, the same is true to these artists. This is the platform that creates a competitive marketplace where they can get fair market value for their assets.

What’s unique about Royalty Exchange is on the platform first, anybody can go on there and register. Is that still available? You can go on and see what’s up for bid but that brings up that point of auction. Can you talk briefly about the auction component of how somebody goes about buying a royalty stream?

There are two ways now that people can buy assets in our marketplace. The primary way and what we’re known for is auctions. What happens is we work with an artist, we validate the income from the catalog, and we validate that they, in fact, own and have the ability to transfer it and then we set it up for an auction. Something like eBay and Sotheby’s mix. Some of the assets can be expensive. We’ve had assets that are in the seven figures that have been auctioned on the platform but the average bundle of rights that gets auctioned off on the platform is about $60,000. It’s what the ending price that is on it. There’s a big range of different assets to get auctioned. If there’s an investor, if you’re interested, we have every auction we’ve ever done, they’re all there.

You can look at the bidding history, what music was, what its earnings were, and how much it sold for. You can get a lot of information by looking at what’s there. Like on eBay, you can watch an auction so you can see how people are bidding on it in real-time. I would encourage, if you’re interested in this at all, do that. Go look and watch auctions but don’t bid on anything right away. Watch some stuff, see how the market works, see how other investors who’ve been bidding on things for a long time. Interact with it and you’ll get a much better sense if it’s right for you at all and if so, at what level? The other part we have, and this is relatively new is a secondary market. Any assets in the past transacted on the platform get automatically listed in the secondary market. Once they’re listed in the secondary market, you can see the assets and what their income is.

If the owner of that asset, this would be the investor, are interested in selling it, they can list the list price. They can say, “If you’re interested in this, I’m willing to sell it for this price.” That’s listed there. Alternatively, you can make an unsolicited bid on any asset that is there. There’s a much wider variety than you would see up for auction at any one time. There are 150 assets in the secondary market. You can compare by age, how old the catalog is, by its earnings of the catalog and you get lost probably because there’s so much information on each one. Auctions can make people nervous. I’ve been known in charity auctions to make very rational decisions, get competitive in them so you’ve got to be careful with auctions. In the secondary market, you can peruse at your own interests and you can place unsolicited offers for people. If they accept it, we’ll facilitate the transaction in the background.

Let’s say I invest in an album or invest in a product and now the income starts, does that come through your platform? Is there an escrow account? How does all that work? 

Here’s the most important thing. When you buy one of these, it’s not as though you need to rely on the artists sending you a check every quarter. What happens is title is transferred at the organizations that collect and distribute the royalties level and they assign the royalty to the new owner. We would handle those all individually. We would individually title them all and people would receive. If you own ten of them, you will get ten different payments from these PROs, Performance Rights Organizations. It’s difficult to keep track of which one is which, but we would have them send all the checks to you. Since then, we started offering a free service for people, we collect and then immediately send out the payment to people. The reason we do that is one, we can see if there’s an issue.

If you have a question about something that’s going on, we can help facilitate and answer for that versus hundreds of other people calling these organizations that aren’t used to it all dealing with investors, they’re used to dealing with artists. If it comes a time where you want to sell the asset, we can facilitate that much more quickly because we have an ongoing record of the performance of the assets. We facilitate the transaction or the ongoing payments for our investors. The payments in most cases, they occur every quarter. When I say most cases, sometimes if it’s with the label, the label might only payout to the rights holder twice a year, for instance, some pay every single month. The typical arrangement is every single quarter, it pays out of check. On average, those checks amount into a little over 12% return for the investors.

Talk about the taxes. Are royalties taxed differently than other assets?

It depends at what point in their life cycle you’re looking at. From an investor perspective, if I acquire somebody’s royalties from them, I’m paying them and then they’re going to pay a capital gain on it. Instead of paying, they would normally be paying royalty income on it but they’re going to pay a capital gain. I encourage everyone to consult their own tax authority or tax accountant. I’m not a tax person but it’s a lot like real estate. In that, you can amateurize the cost of the asset over time. Depreciate it. That offsets a substantial portion of the income unlike real estate, which might have a schedule of twenty years or something in most cases, typically ten. If it’s generating a 10% yield for you, your tax base on this can be low. You’re going to be in a good position. The poorly understood things about this asset class is that from a tax standpoint, it has special treatment in the Tax Code and it’s good for investors.

TWS 37 | Royalty Exchange

Royalty Exchange: A little injection of cash at the right time in your life can have outsize gains in productivity and what’s possible in our careers and futures.


Do you communicate or have ways like accountants have somebody who had been invested in something in this direction that they can use and understand the income stream better?

We have a letter from a tax attorney that describes the way and points to the parts of the Tax Code. We facilitate the general guidance from this tax accountant but we don’t set people up with bookkeepers or anything like that around it. That’s something they have to handle on their own. We haven’t heard of that being a major problem for anybody yet.

It’s fascinating and it’s one of those assets that people are familiar with what royalties are. The artists, movie stars and actors get it. At the same time, how that has been turned into investment opportunities? There are not any opportunities. You had mentioned once that these types of investments exist at a high level like Goldman Sachs or a BlackRock level but not necessarily at the retail level. 

That’s been bad for both sides because it used to be the big featured artists that had a deal that was big enough and could go and get liquidity through somebody like Goldman. Before the hundreds of thousands of songwriters who contributed substantially to these works, the size of their catalogs were not big enough. The income, while it’s generated $25,000 a year for them in passive income, it’s great. From an investor, I’d go, “I would love doing that passive income if I can buy it at a six multiple or an eight multiple, I buy it all day long.” For them, there was no market for this. They had no access to liquidity and investors had no access to the yield. Our goal is trying to make it so that it’s not just the superstars and not the Goldman Sachs of the world that the transact. We’ve done well with that. I want to say one thing about how long the royalties last. That’s one of the common questions we have.

In US Copyright Law, anything after 1978, it looked like this. The IP is owned by the rights holder for life of the last living author plus 70 years. You might have three writers on one song and it stays for all three of those rights holders or their heirs until all of them are deceased and then the 70-year mark starts counting. They last for a long time. On our platform, we sell primarily the royalties in one of two ways. One way is life of rights, which is for life of the last living author plus 70 years. The other way is a ten-year term. You’re buying the right that income stream over the next decade. You get 100% of the income that comes from it. After that ten-year period, it goes back to the original rights holders. Both of those are available on the platform. Which one is better? It all depends on the price. Most of the earnings of these things, if you’re doing it for forecasting out, the biggest value of those earning is going to be over the next decade. As assets that generate income that are uncorrelated, it’s unique whether it’s for 10 years or for 70.

Is that choice done by the holder of the IP or is it done by the investor? 

It’s done by the holder of the IP. They’re told from early in their career, “Don’t ever sell your royalties. Don’t ever sell your rights.” The reason for that is because you always hear these stories about artists getting these awful deals with labels and things like that. That knowledge has been passed down. Try and keep them from getting in those bad deals. Some of them will live that way until they die, they’re never going to sell their rights. By having the ten-year option, it opens up the possibilities.

Matt, this has been fascinating. Thank you for sharing all of this. I love your platform too. Can you give the readers some ways that they can connect with you or connect with Royalty Exchange, get on the platform and look at what’s going on there? 

The best thing you do is go to You can see all of the things we’ve ever done on there, all of the assets that have transacted. One of the other things is that this space has always been prone to secrecy. When deals happen, they’re behind closed doors. No one talks about the multiple they went for anything that. We’ve done hundreds and hundreds of transactions and all the information on them is in the public domain. You can get a good sense of how the market functions and it makes it so that you can participate in an intelligent way if it’s right for you.

Matt, it’s awesome to connect with you. Any last words? 

Thank you for your time and all that you do, Patrick. I appreciate it.

Thanks for reading. I hope you enjoyed. Make sure you go on to iTunes, give us a good review. We also have a new YouTube channel, that’s up and running. We’ll see you next time.

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About Matt Smith

TWS 37 | Royalty ExchangeMatt Smith is an experienced entrepreneur, investor, and advisor who has founded and led multiple successful businesses. He is a passionate free market advocate dedicated to providing rightsholders and creative professionals with fair financial options, and has extensive experience with alternative investment strategies.



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Successful Real Estate Investing With Matt Atkinson

TWS 9 | Successful Real Estate Investing



You can start investing even with zero money on hand if you have perseverance and the right attitude. For successful real estate investing tips, Patrick Donohoe talks to Matt Atkinson who started in real estate as a mortgage professional and has been investing for fourteen years. Today, Matt shares his valuable perspective, thanks to his expertise on his investment niche, and emphasizes how perspectives impact the way you achieve things. Describing his own investing experiences, he tackles what successful and unsuccessful investors do, what attributes to failure, and the things you need to have for all kinds of investment opportunities.

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Listen to the podcast here:

Successful Real Estate Investing With Matt Atkinson

Thank you for tuning in. It’s been a fun season so far. We’ve talked about a lot of different investment strategies. We’ve talked about business in a sense. We’ve talked about the startup world. A lot of what I learned at the Tony Robbins Finance event, it’s been fun. I hope you have been learning a lot. Head over to We’ve updated it. There is a sign up for our email list. We’re going to be a lot more active there as well as our social media. Make sure you sign up for the email list as well as follow us on social media. My Instagram is @PatrickDonohoeCEO. Also, we have The Wealth Standard page on Facebook and LinkedIn as well. Follow us there and you can get all the updates.

In this episode, I wanted to bring on a good friend of mine. His name is Matt Atkinson and he is someone I’ve known for a long time. We met after I moved to Salt Lake City and he was in the mortgage space. I had a couple of years in the mortgage space before I moved to what I’m doing. He is someone that I’ve crossed paths with and over and over. Our relationship has gone onto another level because he is also a member of this Tony Robbins Platinum Partnership that I’m a part of. We have been able to hang out, talk and discuss everything, all topics personal, professional, investing business, it’s been amazing and he’s a good guy. He has a good heart and what’s most amazing is he finds fun and a way to be humorous in every circumstance. He’s an awesome guy to hang around with.

He also has a level of expertise in the residential investment space that is important for you to understand. The residential is typically how a real estate investor will first get exposed to real estate. He has been through some ups and downs and you’ll hear about that with some of his stories. His expertise hopefully helps you guys to understand if you are getting started in real estate or maybe heavily in real estate and have not gone through a market correction. Some of the points in which he is going to make clear will benefit you. Pay close attention. Let me give you a brief background on Matt to do his bio.

He started his career in real estate as a mortgage professional and he has been investing for several years. He purchased his first investment property in 2004, which is a single-family home through a short sale and he still owns that rental unit. He credits the experience going through the ups and downs of 2008, 2009 with getting him addicted to local real estate investing and owns over $14 million of rental properties personally. He has accumulated north of 25,000 hours of experience in this space, which is a few years round the clock. He invested almost $2 million in rehabbing and also an additional $4.5 million on flipping properties since 2008.

His focus is still mortgage in investing, but he’s consulting and he’s teaching what he has become an expert in. He teaches in the range of rentals, landlording, hard money lending, fix and flipping, assignments and building wealth as an investor overall. He served as the President of the Utah Valley Real Estate Investors Association for seven years and is a board member of the Salt Lake Real Estate Investor Association for nine years. He’s a member of the National Association of Hispanic Real Estate Professionals for five years and is a member of the Utah Association of Mortgage Professionals. He’s been with them for several years. Matt is an awesome guy. You are going to get a kick out of him. He is a great guy to listen to, intelligent. I hope you enjoy it as much as I did.

I’m here with a good friend. We’ve been in contact for a long time. We’ve hung out quite a bit. It’s been awesome. It’s been a highlight of my 2020 so far. We have high hopes for this show. Matt, we’ve known each other for a long time in 2005 maybe or 2006. You’ve continued in the mortgage industry right through the financial crisis. We saw each other in 2012, 2013, I went to Jason Hartman’s events and that’s where we connected. I’ve followed you on Facebook as well. We reconnected at some of the Tony Robbins events and you joined the Platinum Partnership and it’s been cool hanging out with you and your wife in some of the events. I’m excited about this interview. After all, you have a perspective that is valuable for the audience because you’ve seen a different side of investment and you’ve chosen to specialize in a niche and have become an expert there. I’m excited to hear your perspective on where you’re at, what you’ve learned from some of the events we’ve gone to, some of the Tony Robbins events. What does your future hold? Let’s start some of these rapid-fire questions to get your perspective of life and where you come from, that’s important. The first one is the pre-work, who was a role model to you, someone that either inspired you or you looked up to?

It’s common a lot of times people say their dad. My dad was a good role model, but I would say in addition to my dad, I looked up to both my parents. A family friend passed away that was influential in me growing up as a child, 12 to 19 years old. He was nonjudgmental. Let me be myself. I was a hothead, mouthy, high school guy. I looked up to him a lot. As I started working, I did some different development. I looked up to Tom Hopkins. I love Tom Hopkins. I met him in 2006.

I met Tom a couple of times. He’s such a good guy, the real estate guys. He’s such an amazing speaker. The second one, superhero. What superhero or icon in history do you most resonate with?

It’s Han Solo. I’m not sure if he’s a superhero, but Han Solo, he’s rebellious. He likes to takes chances. He always gets the girl, but he’s a hot head and he gets killed by his son. That is awful.

Third, what charitable causes do you support? 

I like working being in mortgage lending. Since the end of 2001, we started focusing on veterans on a national basis. I’ve always wanted to help veterans especially once with different disabilities. I have a couple of friends that have come back from the service that has had some PTSD, emotional challenges. I have a Wounded Warrior thing. I also like to give back with people who’ve had the mental challenges because I’m fortunate I haven’t had those challenges. It’s hard for me to be empathetic because I don’t know what they’re going through, but I’ve seen people have that happen to them. I like to give back in that way.

Finally, legacy. If there was one attribute that you could impress upon your kids, grandkids, the world, or this audience, what would it be? 

Don’t take life too seriously and enjoy the journey. A lot of times we’re young, we’re barely 40 and there are a lot of things in life that what can you learn from those experiences? If you can learn from it to get better and then also not do that mistake again, we can appreciate life a lot more.

This day happens to be when they were doing Kobe Bryant’s funeral. Michael Jordan spoke, his wife spoke as well. They talked about a tenacious guy and at the same time he enjoyed the journey. He loved the pressure. He loved the competition. At the same time, there was a level of enjoyment that most people miss when it comes to working hard, driving towards some achievement. They miss the beauty of it, the experience of it along the way. 

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That’s interesting you brought that up. I finished the book, Relentless. Have you read that?

I haven’t. What’s that about?

Relentless is written by Tim Grover and he was Kobe Bryant’s trainer. He’s Michael Jordan’s trainer, Dwayne Wade. You’d like it. It talks about a cleaner who’s Kobe, Dwayne Wade. Michael Jordan was considered a cleaner, a closer, which is a lot of other people, and then a cooler that’s everyone else. You would love it.

It’s the different archetypes of basketball or pro sports.

It’s in life and he gives a lot of examples. I learned about the book at a real estate investing class that I went to. The speaker talked about it and I was like, “I want to read it.” I barely finished. He gives a lot of examples of Kobe Bryant and Michael Jordan.

It was touching. There were many people there, but it shows you how much of an impact one person can make. He was in a stage where he had the attention of a massive audience. At the same time, it was one individual touching many. Even Michael Jordan, you should go and check out that video. It was touching because Michael Jordan usually is an A-hole when he speaks, but there was another side of him. It was cool to hear those short stories to show you how that type of tenacity can inspire and touch people. 

Especially as Jazz fans, we respected Kobe Bryant but hated it when he beat us.

I wasn’t a Jazz fan then, I wasn’t around.

In 1997, right after I graduated from high school, a friend of mine got tickets to go to the Playoffs game, the Jazz versus the Lakers. I was at the Jazz, Lakers game when Kobe Bryant shot the airballs in the Playoffs and missed. They talk about it in the book Relentless. That was pivotal like, “You’re a rookie, you missed some three-pointers and then he gets good and wins.” I remember Kobe for a long time.

That’s the thing. Those are the moments where you could say it was a failure, but it was probably a huge catalyst for him to do however many free throw shots until he had it done to perfection. Few people seek out those opportunities to face humiliation or face failure at that level.

He was chucking three-pointers, going out of style. I also watched the last game when he played the Jazz in LA of that tsunami eating sushi with a friend and scored 60 points. That was an amazing experience.

I remember they showed some highlights too when he was playing that last game and he knew he was retiring after the season. He showed a lot of affection toward coaches, owners, a classic guy. He learned a lot from his rookie season up until his last season. Let’s get into investment. A lot of what we’ve been talking about as far as a legacy is a concern and purpose. We’ll probably come out based on some of the experiences you and I have had with the Platinum Partnership event we went to, but I want to get into your investing experience. That’s the topic of this season, the theme that we’ve been revolving around because it’s an interesting time financially with where our country’s at. If you don’t understand some of the fundamentals in economics and have the experience of when things shift, they can catch you off guard. Oftentimes without that perspective, we are always looking for things that you may not be aware of that could impact what you’re trying to achieve. Those things are what catch you off-guard and there are two ways to learn. You can either experience it yourself and learn or you can learn from the experience of others.

I’d way rather learn from others.

Sometimes you take other’s perspectives. It depends on what level they’re at. That’s why I wanted to talk about your experience briefly so that the audience can realize where your expertise is, what you’ve gone through since you’ve been investing in real estate? Can you describe in a nutshell your investing experience?

TWS 9 | Successful Real Estate Investing

Successful Real Estate Investing: It is better to make a bunch of improvements and sell it versus those lending the money.


A lot of times when you first start, you have no idea what you’re doing. I bought my first property in 2004. I bought a couple of properties in 2005 that were mortgaged clients that were able to refinance and notice a default filed they had a not a good situation. I ended up buying their houses and then in 2006 I bought thirteen homes. That’s when we met. We’re doing a lot of fulfillment for option ARMs with an amazing five-point agent loan. That helped me learn that a lot of people would be buying properties purely for the appreciation and they didn’t have the cashflow or make enough money to offset the mortgage payment or the less than interest-only mortgage payments that we were good at providing them.

There was a group that did real estate coaching or consulting here in Utah and they would pitch opportunities throughout the United States. We would do mortgages for them throughout the United States. I believe you did that also and I recognize that they’re normal people, postal carriers, a manager at Barnes & Noble. I did a mortgage once for a kitchen manager at McDonald’s and anything in between and they were not cashflowing. In 2006, other parts of the country hit their peak like Arizona, Nevada, California, Florida, wherein Utah, we were 18 to 24 months behind. The other investors nationally started buying in Utah because we are still going up and they would do a lot of new construction. They would flip the lots to other people.

It was 2006, 2007 that you could assign the new construction house to someone else and make $20,000, $30,000. It’s very common on condo developments. I started not buying as many properties because I didn’t have a lot of extra cashflows. I need to have some margin. In 2007 when the bank started going goodbye, I remember someone, you close on a purchase and you think you’re going to get your money and the bank’s out of business. During that time, it made me a lot more cautious about money. Always have six months of living expenses or savings, reserves are super important. During the downturn in 2008 to 2011 in Utah at least, it went down 10% to 15% values a year where other parts of the country were going down in value. I was not able to get any more regular mortgages with traditional financing. I started buying with seller financing and I would buy properties from good people who were behind on the payments that bring it and keep them as rentals.

When was all this going down where everyone was pessimistic about the real estate market, what gave you the confidence to continue doing it?

I was born that way of doing things that a lot of other people don’t do. It wasn’t a cool thing. None of my friends are like, “Let’s go buy this house in the Westside.” That’s not in the area that we’d want to live, but keep it as a rental or fix and flip that. I was not able to get any more loans, not because of my creditworthiness, but because frankly Fannie Mae and Freddie Mac would not allow you to get more than four mortgages. I had ten already, I’m like, “I’m stuck.” I knew that not everyone should short-sell because there were people that were behind that as long as they were current, they would sell you their house. I learned that from a couple of other people that I didn’t understand. I’m like, “That’s weird. Why could I buy their house from them? Me buying the house from them and it being current and keeping it for 5 or 10 years is better than them short-selling it.” I fell into it. I was aggressive that anytime someone was delinquent and I had the money to bring it current and there was some equity or I could at least cashflow, I’d buy as many houses as I could that way.

What are you up to? 


Do you own them all? 

I own them all. I do some partnership with my dad and some with my wife.

You also do hard money lending. That’s also an interesting story because you were doing that pre-2008. I recall a lot of people got caught holding a bag that they couldn’t find permanent financing to replace what they had borrowed at high-interest rates.

A couple of friends and I would buy income properties from each other, even in 2006. If you have maybe $150,000 and you’re like, “We’ll loan each other money because you couldn’t lend yourself the money.” We would lend each other money, notes, deeds of trust at 12%. We’d always charge each other 2 points. Two and twelve no problem and watch each other out. What’s interesting is during the market correction, Fannie Mae and Freddie Mac would still allow you to always refinance off the appraised value as long as you had a note in a deed of trust immediately, which was interesting. I was able to refinance other people still. The difference was in 2007 and 2008 when Lehman Brothers went out of business and a bunch of other lenders, you could get 100% financing on non-owner-occupied properties back then. That’s what the program will allow. As that program discontinued and then the values went down, that’s when a lot of investors did short-selling or sold their houses.

You kept going with hard money especially during the downturn. You can be maxed out with several loans you can have with 1 to 4-unit buildings and you continued to use hard money and lend hard money. 

We started fixing and flipping homes because we would get the deal flow but we couldn’t get the rentals. We didn’t think about partnering with a bunch of people. I’m glad I didn’t. I could have partnered with 40 different people and you’d have all these K-1s and everyone’s in a different and financial spot and people get divorced or sick or whatever. We started doing fix and flip. From 2008 to now, we’d normally have done about 8 to 10 fix and flips a year. A couple of years we haven’t done as many because we’ve been working on improving our portfolio and selling them. To be honest with you, I’d rather lend a bunch of money than own the property or rehab a bunch. We still are remodeling houses and keeping a pulse on what construction costs are and then you look at it differently when you buy an asset, you got to make a bunch of improvements, and sell it versus those lending the money.

During this time, you were plugged in from what I assume to the investment market in general and have probably seen a lot of success summary similar to your own but also a failure. What do you attribute to the successful investor and then equally to the unsuccessful investor?

I would say three things that successful investors do is, one, they’re modeling other people who’ve already done it. They’re not trying to reinvent the wheel. They will follow what other successful people have done and then we can modify it on our own. The second thing is a lot of people who are more successful than I have noticed have been good about self-development like how to get better with systems from assignments to fix and flips to rentals to hard money lending. I’m going to an apartment syndication class in Dallas because I want to learn from other people. The third thing is they’ll cut their losses quickly versus sitting on it and hoping it comes back. During the downturn from 2008 to 2011, the second year when I was doing fix and flips, I noticed I had to change my prices before the market forced me to, where most people are the opposite. They would keep slashing but they always are 2% to 3% behind the market. As I liquidated, I would say 9 out of 10 we win, or 1 out of 10 we learn. As long as we make those modifications on price adjustments quickly, we were able to make a decent profit on at least fix and flips.

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Do you have a rule of thumb as far as when you got out?

On fixing flips, our objective is to go in, remodel it in a timely fashion, but not the, “I’m doing the work myself or coordinating that.” Ideally, you’d buy a property, remodel it and have a sold within six months.

If you didn’t, what was the breaking point? Was it time? Was it the price?

It’s both. We would lower the price to take the loss. Accidental flips, I don’t want to keep as rentals because how you remodel them for a rental is not the same way as you do as a flip.

Talk about failure. What do you commonly see? There are probably a lot more attributes of failure.

The arrogance and I was arrogant too, depending on who you’re talking to. Newer investors think they are untouchable. Everyone has made money in investing because the market has gone up. You can be smart because you bought something but not smart because you bought something and you’re like, “I made money.” Number one is arrogance. Number two is they are not studying. They are not studying trends. They’re not keeping conscientious of national news. They’re doing it their way, where it’s easy if you mimic someone else who’s more successful and you run with that. The third thing is they’re unfocused. As real estate investors, I learned this from a guy named Pete Fortunato. He says, “The first ten years in real estate investing, you’re considered a starter.” You’re all over the place. Everything squirrely is what you want to do. Fix and flips, buying holds, assignments, apartment, land development, hard money lending, whatever. In years 11 through 30, as a real estate investor, you care about two ways of cashflow. Cashflow from notes, hard money lending, or cashflow from rentals, single-families, multifamily, commercial, storage.

Here’s where it’s amazing that correlates with Tony Robbins with what we learned. On your 31 through 40, if you think about it, if you’ve been investing in real estate for 30 years, you’ve gone through some cycles and you should be a lot smarter with what you’re doing. He says, “You have two concerns. Number one is you want to pay the least amount of tax as possible, tax-efficiency. The second thing is you don’t want to lose your principal.” That shifted me in 2016, my investing strategy, because I was like, “It’s not all about how many doors I have and other things like that. I want to be a lot more tax-efficient with controlling or owning real estate.”

At the beginning, that’s when you want the most bang for your buck. That’s when you want the most upside. It’s the whole rocket ship, tons of fuel expended on takeoff. Once you get into the atmosphere, then much less fuel that propels you forward because you already have that momentum, it’s similar. I would say maybe in a nutshell with other investments too that you can correlate this principle, is in the end when you’ve built up a mass, you’re looking more for principal preservation, for the highest amount of return for the least amount of risk. Let’s get into some of the Tony Robbins stuff. He’s used this term, “Winter is coming,” for several years. He talks about life being different seasons. You have spring when things are blooming, you have summer, but then you have fall, which is harvest and then after harvest comes winter. There are a lot of people reaping. A lot of people making a lot of money. There are capital flows that are still abundant. What does that statement mean to you? You’ve experienced multiple seasons. When he says that, what goes through your mind? 

The correction from 2008 to 2011 sounds crazy. I remember talking to someone that I ended up buying his house, which is ironic. One of his houses and I’m like, “I can’t afford steak.” He’s like, “We’re going out to eat. You’d gotten chicken.” I was like, “Okay.” It’s a mindset with it. Winter is coming, I would say in real estate investing and then I’ll pick the overall market. In Utah, we’ve had a run. We hit our bottom in 2011 so we’ve been going up for nine years straight. That’s crazy. On average, I’ve been about 10% appreciation a year, which is not sustainable. It’s not affordable for people. With that being said, there are three things Utah has that are different than everywhere else. Number one is the LDS religion. Regardless if you like it or not, it’s super family-oriented and people feel safe here. They’re a great place to live.

The number two is Utah’s pro-business and there are a lot of smart entrepreneurial people here. A lot of people are coming here. The third thing is tech. It’s Silicon Slopes. It’s interesting how many people are coming here and are going to tech. It is influencing our culture in a good way but it’s also making it a little less affordable for a lot of other people that are not choosing to develop those skills. With winter coming, there are a lot of newer real estate investors who’ve been investing only five years and they have no idea what it’s like to have to make hard money lending. Many people are lending, they’ve reduced their rates, their fees and they don’t require interest.

When you have $1 million out of a hard money loan on multiple loans, let’s say you have three loans and you have $1 million out, you’ve got to write a check for $10,000 a month, you’re going to get more motivated to make your payments. Were other parts of the country you’re making that check every single month. I’m excited for the market to soften when it does. I’m going to kill it and buy a bunch of properties. The last three falls to winter to spring, I thought we would hit our peak and I’ve been wrong. Here’s why I’m glad I’m wrong. As I’ve bought in the fall though, I’ve made more profit in the spring. I’m going to go into each season as we’re going to stabilize and then have a little shift down because it will always keep me honest versus always banking on the spring’s a good time. From 2008 to 2011, what you bought in the fall and what you listed in the spring was worth 5% to 10% less than what it was in the fall even though the time of the year.

I look at winter because he always says winter is where all of the opportunities are. Where everyone is the most pessimistic and usually the unsuccessful investor is the one who has his emotions governing decisions. Whereas a seasoned investor understands the role of emotion, but also the role of logic. They have preset assumptions as far as what they should do given the environment. I look at winter coming, it’s a matter of the season. The timing of it, you don’t know. There could be a downturn starting after the election. Who knows? At the same time, it doesn’t mean that you should sit on the sidelines. It means that you need to be cautious, understand numbers, understand what those benchmarks are because there are always going to be opportunities. At the same time, it’s knowing that winter is coming. It’s recognizing that having some liquidity, having some reserves is going to prepare you not to weather the storm, but thrive during that storm.

Having the reserves, tons of people are like, “How do we buy real estate with no money?” The question is, “What can you do to earn more money so then you can buy more real estate to leverage your money?” I used to teach classes how to buy real estate with no money, but I’ve got to be honest, it’s way more fun to buy it with money because you’re a spender, saver and investor. There’s a transition of the three and we learned this from mortgages and other people. There’s a mental and psychological transition. You can be a spender all day long then you get a chunk of money. If you don’t know how to save it, it’s going to go regardless of what your income brackets are. We’ve met different people like that throughout our lives. You can transition, but there’s a lifestyle change to go from a spender to a saver and it probably takes a couple of years and you need to have money sitting in your bank account. You have to be disciplined saying, “I have $5,000 or $50,000 or $500,000 that I cannot touch.” As you have that self-discipline, then you can invest.

That’s what we learned, which is something I’ve instituted and often do a little bit too much of because of the experience of 2008, 2009, which is what the proper reserves are? What amount of money is the right to having a security or certainty bucket? If you have all of your money there, there’s not going to be much interest or much gain. Most of the gain is going to come from your earnings, not from your investments. It’s where do you draw the line between enough and too many reserves? That’s all an individual conversation yet when you’re asking the question of, “I don’t have any money, how do I buy real estate with no money down?” That’s the wrong question.

TWS 9 | Successful Real Estate Investing

Successful Real Estate Investing: Successful people are good at self-development.


The question is, “What can I do to earn money so I have money that I can prepare to own real estate?”

It’s not hypocritical because when you started to run out of whether it’s mortgage available to you based on lending guidelines or even your cash, then it’s, “I’ve done that. I have my reserves. How can I leverage other people?” There are tiers as far as how you involve others in your investing.

Something I need to share is you reminded me of, if you have six months of living expenses always in checking or savings or whatever is a liquid account, you’re going to be in a good spot. If you take it a step further, if you’re self-employed and if you know your operating expenses as a business, if you think about it, if you have six months of living expenses in savings and six months operating expenses in your business account, you have tons of control because you know where your numbers are. After that, you invest as aggressively as you’d like to however you feel it is appropriate.

How often do you assess your scorecard? Where your cashflow is? Where are your finances? Is that something you do monthly?

My wife and I go over our spending plan every single month. We review it annually based on our previous years’ experiences, budgets on books for all business entities including flips, rentals, everything else. I review those quarterly and I’ll normally use a trailing six-month history. Three months is too short. Six months is good. You look at a year, but I met with a CFO of the mortgage company I work at to do forecasting, based on what we discussed and what we’ve done, we’re like, “We’re in a good spot that we can make modifications and change things.”

A few more questions, first off, let’s finish off the whole core four. One of the things that Tony teaches is when it comes to any type of investment opportunity, there is a minimum of four things to have. At least have an awareness of number, one, it’s making an investment where you’re not going to lose money. Having an asymmetric risk-reward, meaning you have little money in the deal, but massive upside. Tax efficiency being when the first two are in place, are you going to get tax at the highest rates or are you going to have some tax favorability to the investment? Also, diversification, which is if you specialize in some niche, there are all external factors whether it’s regulatory risk, economic risk, interest rate risk. There are things are outside of your control that is impossible to prepare for. Having diversification across asset classes will help as these economic winds take place, that one type of investment because it’s not correlated with another, balances out. Those are his four primary principles of investment. How do you interpret that? How have you used those principles, those ideas to manage your investment decisions?

No one likes losing money. With that being said, Keith Cunningham calls it a dumb tax. It’s like, “Don’t make that dumb tax again.” We’ll pick hard money during the free correction. There were a lot of real estate deals that were on new construction, land development. I’ve only shorted one mortgage at a 10% haircut since 2006. I’ve never had a foreclosure. That has a lot of confidence. Someone could say, “That doesn’t mean you’re risking enough.” That means I’m underwriting the person, the deal and making sure investors I work with are in a good spot. I also didn’t do any spec homes during the crash. Some of my friends made $100,000 chunks and I made my little $10,000, $15,000 chunks doing my little flips. I’m a single guy who may be a devil. Maybe you’re stretching out that devil every once in a while. Don’t lose money.

The asymmetrical risk versus return, that’s an interesting concept, which was new to me until I read MONEY Master the Game and then also Unshakeable, and went to Wealth Mastery and all those financial summits. Here’s how it works. You can buy real estate with less capital borrowing OPM, Other People’s Money. That’s me. That’s how I bought most of my properties. As I buy with seller financing and as I’ve thought about this, for $20,000 out of my pocket, I might be buying someone’s house for $200,000 which is only 10% down. That property is worth $350,000 and it’s paying down to $160,000 and that cash-on-cash return is good.

Understanding how to do that correctly, I know how to do that with real estate. I’m not familiar with how to do that in other businesses. Tax efficiency, I don’t love writing big checks to the IRS. I’m all about what can I do to reduce my tax liability and then also in the future? Using Roth IRAs, self-direct and 401(k)s are both in the market and then also in real estate investing. You’re super familiar with different insurance policies that help you with that type of coverage or also benefits. Tax efficiency, I’m more concerned about pivot and make little modifications as I grow my portfolio versus if I didn’t think about that, it’d keep rolling. I’d be like, “I have a good tax burden.” Diversifying, we learned something from Ray Dalio. We’re supposed to have fifteen uncorrelated investments that are a lot. I did exercise for my real estate consulting clients. It was challenging for me to write out fifteen, but I did it on the teaching and I was like, “It’s way easier for me to figure out fifteen ways to buy houses.” It helped me recalibrate. What I’m doing with that is reviewing more diversification in the stock market. I am going to buy some gold, even if it’s 1% of my portfolio or 0.5%. I’m also focusing on some different insurance policies to complement what I already have. It gives me some good recalibration with my long-term plans.

That’s where I look at diversification. You become an expert in this specific niche. I would say it’s hard once you’ve done much there and even have gone through tough times to diversify outside of it because there’s always that weight of opportunity costs. How do you characterize that dynamic?

One thing I’m doing is I decided because winter is coming to liquidate 10% of my portfolio. I’ll call my D-class properties, my 2 bedrooms, 1 bath, 1920s houses that are old but they are good what I bought. Everything that I own that’s 1950 or newer, it’s at least 3 bedrooms, 2 baths with a garage, I’m going to keep. If it’s an older than 1950, 3-bedroom, 1 bath, no covered parking, no garage, I’m liquidating because we’re at the peak of the market and it might go up into gear again and it might go up in another year. I might as well liquidate, take some money off the top of the table. We learned that a lot. Half of it I’m going to use my cash. I’ll lend hard money. I view hard money lending as having money in the bank. I can sell a note easily for face value within a week to a lot of different people. The other part of the money is I’ll do 1031 Exchanges and buy some expensive multi-units. If I take my gross revenue, let’s say I’m grossing $1,500 a month in rent and I can sell the property and take $150,000 and buy a $500,000 fourplex. My gross rent is $4,000. My cashflow is going to increase. That’s going to put me in a better financial position then I’ll let that $500,000 fourplex slowly appreciate it at 3% for 10 years. Let the principal pay down and then I’ll keep growing my portfolio.

You know how to underwrite, you know how to look for those opportunities and you have enough of a portfolio where you can find different opportunities in there to become more efficient with certain properties. I know you’re going to learn about multifamily too, which is I would say other opportunities because of the demographic shifts, especially here in Utah. The idea of taking something inefficient and making it more efficient. Let’s end with some of the stuff you’ve experienced over the last couple of years with the Tony Robbins’ organization around legacy. How has that impacted the perspective you have with your money, your investments and your business? Let’s start with what you’re excited about in life?

I went to eight events, which is a lot. I’ve seen you. We hung out every other weekend or every other month. I’ve seen you more than a lot of my good friends that live in Utah. I’m excited about being more self-aware of how much more we can do in life. Not just financially but mentally, socially, engagements with other people and being more impactful. Thanks for letting me participate in this show. I know that if I help one person, it’s worth it. What’s cool though is I can keep this and share this with my kids in the future. They’ll be like, “Dad was saying this when we were kids.” A lot of my friends are like, “You say the same thing over.” I’m like, “It means it works.” Tony Robbins has helped me think of being better-rounded or balance. Here’s an example of the wheel of life. Do you remember that exercise?

Most of the things, I’m 8 and 9 and 1 being I’m a 6 and here’s the cool thing, that gives me some metrics to measure up and improve. Number one is self-awareness. Number two is how much our psychology makes a difference in life. It’s huge. Influencing our significant other, our kids, our family, our amazing team that we work with, clients that we serve, the community, that’s been impactful of making your move, change your state, jump on a rebounder. It makes a difference in how we choose to do things.

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Have did you redefine your understanding of wealth or has it been redefined?

I would say I was more monetarily-motivated. I’m more lifestyle-motivated. Lifestyle not necessarily means, “I can’t get the steak, I’m getting the chicken.” During the market crash, it’s being able to choose. I was meeting with my controller and had a phone call about 2019’s finances and where everything’s at. As we’re looking at it like, “What do we need to decrease?” It’s always good to trim the fat and reevaluate. As we’re reviewing what to trim and then I was like, “Here’s the opposite. How much more do I need to earn to keep doing with what we’re doing?” They’re like, “That’s a good question. We should come up with a number to go towards because I know that I get more inspired by going towards that number. As we cut the fat from other things, then we can be in a good spot too with that.” Where before I would’ve liked, “Let’s cut.” It’s been more like, “What do we want?” Tony teaches RPM. What do you want? Why do you want it? The three action items, that’s been reinforced.

It’s simple. At the same time, most people completely miss identifying the results first. If it’s not done, then going to the solution, going to the how is risky. That’s where I look at one of the exercises he does when he has us all write down the number we think it takes to be financially free. Everybody massively overshoots what it is because of a failure to be crystal clear with the results that you’re after. Understanding not the results, but the purpose, the why of those results. A big thing for him is if you’ve identified this, he doesn’t use asymmetric risk-reward with money, but he does it with what he wants out of life. It’s, “Here’s the result I want. How can I get it for the least amount?” I love that because ultimately, in the end, we don’t want money. We want experiences. The lifestyle is, as you put it, they bring us the most satisfaction, joy and then ultimately benefiting the lives of others. It’s getting in that contribution mode. Money is essentially a vehicle to make that type of difference, both in yourself and both in others.

That is huge because if you don’t recognize that going into any type of investment strategy, your emotions are going to overrule sometimes unless you’re able to appreciate and be grateful for what exists. If things happen, that’s great. If they don’t, then you still have and retain that state. Usually, that’s what I would say brings what results we want closer to us. As opposed to sometimes when we’re not satisfied and grateful, it prevents those things from being in our life. Anything else you want to add as a final thought?

It’s interesting how we worked together and at the time we were 26-ish. This young up and coming, you were married. I got married in 2007. I remember going to the Five Point Agent class that Garrett White taught. The cool thing is he’s made a big impression on my life. I met him. He was my college roommate. It’s cool to see how different people show up in our lives at different times and then it can be years later, but he encouraged me to take a Wake Up Warrior class, which I loved to help spur my reading. Reading, loving what is then a bunch of other books. He introduced me to Strategic Coach. It’s platformed, stacked positively. As we had Peter Diamandis, he’s speaking at Tony’s event, but he’s also a strategic coach, student. He’s given tons of credit to Dan Sullivan. The cool thing is all of this is available to anyone who chooses to take the time to study. I would never think I was going to Tony Robbins event running around at the Sun Valley but when I woke up, saw the market, I’m like, “I knew or I was aware of what this could impact the economy.” I’m like, “That was worth the money.” I am not freaking out, I’m like, “I’ll explain it.”

Everyone that’s reading this, here’s my suggestion and Patrick knows this. I wear shirts. I have my swag on the back. If you take three things you learned from the show and as you implement those three things and give yourself a date. I’ve learned this from Garrett White, Dan Sullivan, Tony Robbins, probably my Priest Quorum Advisor when I was a kid, whoever. When you write out action items and have it outcome-driven, you can do much in your life. Those who take the time to read this, it’s cool to read but take the time and people say massive action. Do something. You’ll get farther along by doing something versus being entertained because we have amazing voices.

What would you say are the primary reasons that prevent people from taking action?

It’s a lack of confidence in themselves. I’ve been a confident person to do stuff. What I have gotten from Tony and even Tom Hopkins. In 2006, I never see failure as a seller but only as an opportunity to practice my technique to perfect my performance. He has these little incantations or sayings that are ingrained in me still. As we’re more confident in life and then we have at-bats, the more at-bats we have and build that confidence, then we can take on a lot more things.

I love how Tony puts it where we have a 10,000-year-old brain that is still trying to protect us from the saber-toothed tiger. That fear is there, but it’s an irrational fear. If you know that, and when that fear comes up because people associate putting down something on paper saying, “This is what I want. This is what I want to achieve,” and then not achieving it as a huge fear of failure and the belief that they’re not enough. That prevents them from taking any action or putting any result down on paper. If you look at those instincts that are inside of us that are trying to protect us, that’s that feeling. We don’t have to be protected like that anymore. When it comes down to any type of fear, we live in a privileged country, in a privileged time in history where fear should not be there yet. It’s always going to be there.

Knowing that upfront and recognizing that, “Here are the results I want. Here’s why I want it. Here’s the massive action that I’m going to take to get it.” Even if you don’t get it, the massive action teaches you and brings you closer to what it is you want for. If you understand that, it’s one of those things, it’s programmed in our DNA and it takes a lot of repetition. It takes trying and being tenacious and not stopping similar to Kobe as we started the conversation with that. He missed those free throws as a rookie. He didn’t quit. It made him work harder. That’s the principle of failure. The bigger you can fail, the more likely the bigger your success.

At the end of the day, it’s how we will be remembered.

We’re all compelled to make a difference in somebody else’s life. Once you cross that line, life takes on a new meaning. I believe that as you have kids, as you have relationships and you have those that you make an impact on, it provides you with a sense of satisfaction, the fulfillment that you want to continue doing it. It’s identifying it first, it’s most important. This has been a good conversation.

Thank you. I did even feel like it’s natural. We should be at the beach.

You referenced something about the stock market crash. The stock market’s down because of the Coronavirus. I would say one of the overriding themes of the Financial Summit in Sun Valley was the impact that’s going to have because of how significant a role China plays in the supply chain side of things and how a slight disruption is going to have a ripple effect. It goes into many different industries, countries and economies. It’s interesting to see how that all plays out. We get to watch it.

TWS 9 | Successful Real Estate Investing

Successful Real Estate Investing: When you write out action items and have it outcome-driven, you can do much in your life.


We get to play and participate with a little more confidence than other people.

Thank you for reading. This has been awesome. Matt and I have some awesome conversations at dinner and different meals that we have but I’m grateful for you. I’m grateful for you how you’ve stepped up and you post a lot of stuff online and are trying to inspire people to be better continually. Do you want to mention maybe a few ways in which the audience can follow you or learn more from you?

I’m a big Facebook guy, because I’m over 40, I’m not on Instagram as much as where there’s this demographic they’re like, “We’re here, you’re on Facebook and you’re younger, you’re on Instagram,” and then there’s other stuff. Matt Atkinson, my real estate consulting company is called MJA REAL Consulting. I love helping people with real estate investing. I’m the President of the Utah Valley Real Estate Investors Association. We have meetings every month for those that are in Utah. It’s worth going to in Utah County to go and learn. If you need residential financing in Utah, I work at Intercap Lending. My email us If you put in the subject line, “I read Patrick’s show and he’s good looking,” I’ll probably talk to you a little extra, but you’ve got to put in the subject line, “He’s good looking,” for you to get some extra time.

Thanks for reading. Matt, thank you for your time. I appreciate it. I’d love to have you on again. Take care.

Thanks. Bye.

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About Matt Atkinson

TWS 9 | Successful Real Estate InvestingMatt Atkinson started his career in real estate 18 years ago as a mortgage professional and has been investing for the last 15 years. He purchased his first investment property in 2004, a single-family home through a short sale, which is a rental unit he still owns today. However, he over-improved the property, spent too much money on the renovation, and mismanaged his tenants. Throughout this process he learned the struggle of having a full-time job and being a landlord, and how to effectively utilize other industry professionals to improve his investing.

Matt credits this experience with getting him addicted to local real estate investing and now owns over 16 million of rental properties personally and with partners. He has accumulated 25,500 hours experience – nearly 7 years round the clock – and has personally invested over $1.87 million dollars in rehabbing rental properties since 2004, and an additional $4.55 million on flip properties since 2008. After making only $500 on his first flip project, he reevaluated the strategies others were using and learned how to effectively buy the property, get the most bang for his buck during the remodel, and how to price the home for the quickest and most profitable return.

In 2012, Matt and his team added real estate consulting to their services. He has focused consulting on a local level with his expertise ranging from rentals, land lording, hard money lending, fix and flipping, assignments and building wealth as a investor. He currently serves on the board of UVREIA for the last 6 years, SLREIA since 2010, NAHREP for 1 year, and is member of UAMP.

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