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Andrew Lanoie | The New American Dream

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Hosted by
Mike Ayala

This week on the Investing for Freedom podcast, Mike is joined by his business partner Andrew Lanoie, to discuss all things real estate and the economy post COVID-19. Andrew has his own podcast, The Impatient Investor, which you can check out on all major podcast platforms, and as well as at theimpatientinvestor.com. Enjoy!

“There’s always you know, more time in the day… The reality is its excuses.”

HIGHLIGHTS:

0:00 – Intro
1:22 – Andrew’s background
3:02 – Andrew owes his success to hard work and curiosity
5:26 – Andrew discusses his biggest setback and what he learned from it
7:26 – The best advice is to listen
9:31 – What is the affordable housing space
15:42 – Is real estate a good deal or not? Maybe…
17:00 – Affordable housing will be more necessary than ever
20:00 – People are moving from urban areas to rural areas
23:12 – People are falling into thinking there’s more money when really, there isn’t
29:39 – The best thing you can do right now is financially to educate yourself
33:37 – Andrew gives us his background and where he came from
40:42 – Flexibility and intuition are key
44:07 – Whether you’re W2 or an entrepreneur, you need multiple income streams
46:15 – There are problems with the school system
49:01 – You need to get financially educated
50:36 – At the end of the day, your boss isn’t coming to save you
52:03 – theImpatientinvestor.com, available on all major podcast platforms

FIND | ANDREW LANOIE

Podcast | Theimpatientinvestor.com
Four Peaks | Fourpeakspartners.com
Facebook | https://www.facebook.com/AndrewLanoieOfficial/

FULL TRANSCRIPTION:

Mike Ayala 0:03

Thank you for joining me on the investing for freedom podcast. Today I’ve got Andrew, Illinois, my business partner in studio and I’ve been thinking about this interview for a while I’m pretty excited about it. Andrew, getting to the real estate investing part of his life had quite a journey. And I think this is going to be inspiring to a lot of people because it doesn’t really matter where you started or where you came from. You know, the path leads wherever you want it to and Andrews’s backgrounds interesting. Every time I hear him tell this story. I’m just, I’m amazed at where he started and where he ended, and so on. I think this is just going to be inspiring. And we have a fun conversation today. And I’m excited to introduce you to my partner Andrew, Illinois. So Andrew, thank you for being in studio with us.

Andrew Lanoie 2:09

Yeah. Thanks for having me. Yeah, it should be fun to be here. Yeah.

Mike Ayala 2:12

So right, digging right in for questions, who’s had the greatest impact on your life?

Andrew Lanoie 2:16

I think my mom and dad had the greatest impact in my life. And I think, you know, my dad was my dad’s father was a plumber, an electrician, and my dad ended up going into that into those trades. He actually owned a little bit of real estate for a while early on him and a little, I think it was a four Plex or a five unit building in New Hampshire where we grew up. He managed it himself. It wasn’t a good experience for him. So I think that steered him away from real estate. And he also owned his own plumbing company for a while and I don’t know how long it was. It must have been maybe three or four years or something like that, and he ended up closing it down. He retired as the plumbing inspector the city we were in in New Hampshire. My mom was a nurse. And both of them worked really hard through their through their whole career. And they raised three kids and you know, we’re probably lower middle class and so, you know, vacation was getting the car and drive to the lake or stuff like that, which was great as a kid you don’t know, you know, what you don’t have or have, right? Yeah. So I think I think it really was my parents because they really, you know, it was like, Hey, hey, I want I want a new bike. It’s like, Alright, how you going to get it? Yeah, you know, work for it. Right. And so I think that instilled definitely some sort of some sort of work ethic in my life. So I would say my mom and dad.

Mike Ayala 3:45

That’s awesome, If you could narrow it down to one thing that’s had the greatest impact on your success, what would that be?

Andrew Lanoie 3:53

I think some of its some of it may be the just working really hard. Through a lot of my lot of my career, some of it I think is I think a very curious with people in general. So when I’m meeting someone new for the first time, and I’m always asking a lot of questions, and we’re kind of my mind always goes is being a connector and someone says, Well hey, I’m so and so and I do this and then I’m like, Well, have you met Dave? Because Dave does something similar to that and then it’s trying to figure out how to connect someone to that. Yeah, so I think I’ve always been kind of a connector but I’m but I’m genuinely very curious about people. And I think that leads to asking a lot of questions. And so you find out a lot about people through that process. I’m sure we all know people that just don’t ask questions, right. Yeah. And that’s, that’s just how people are wired. So it’s not a right or wrong, but I think I’ve had some pretty good relationships because of that, just really connecting and then it’s one step further is, well, how you know, so until really need something? And how do I help them with that? It’s like that Zig Ziglar quote, right? Don’t try to help just try to help people. And so some of it, that was the easiest for me, it was never a challenge. It just kind of came kind of came naturally.

Mike Ayala 5:11

Yeah, I remember, I don’t know, when we first started working together, you probably still have it. But on your computer, you’ve got the zig ziglar. Quote, why don’t you say that for?

Andrew Lanoie 5:19

Yeah, I think the quote is, it’s something to the effect of it, and you can have everything you want. In life, if you just help other people. It’s something I’m paraphrasing, but it’s something along those lines. It’s just like, you know, it’s like the Gary Vaynerchuk book. It’s like, you know, Jab, Jab, hook, right or whatever that isn’t just give try to find ways to give and it doesn’t have to be complicated or complex. It’s just, you know, add value, and add value to someone’s life.

Mike Ayala 5:45

Yeah, I’ve noticed that. Just watching you in conversations over the years. You’re, you know, so many times in life. Hey, how you doing today? Great. And it’s like nobody, you people don’t really care, right? It’s like the go-to it’s kind of like Hey, what do you do for a living? Nobody, like most the time when people are asking that they don’t care, but I’ve noticed with you, you really take the time to get to know somebody and, and I don’t think that that’s just strategic with you in order like to build your business. That’s not why you did it. You just have a genuine curiosity. And I love that. I think it’s true. What was your greatest setback and what you learn from it?

Andrew Lanoie 6:22

So I think one of the setbacks I had, when, when I was a talent agent, William Morris, there were kind of two different kinds of people in the in that world, you are either a signer or you are a servicing agent. And I think a lot of the signing agents, so those are the ones that would go after the bands, right? And they would sign the bands. And then they would build a team and so would have to go service those clients. And it was really sexy to be a signing agent, right? Like that’s what everyone wanted to be is they wanted to be the ones and then kind of delegate the work off. I was okay as a signing agent. It wasn’t Great, but I was but I found out I was really good servicing agents there. So I had my own clients, but I also service the other clients that are really well. And that’s, and that took a little while, I think it was a mind-set shift at some point where I’m like, Well, I can do some of the signing part, but really 75% of my business is doing the servicing. And I ended up you know, I think one of one a couple of years, there was, you know, doing $40 million of business with other clients and probably one of the top earners in the department just based on servicing. So they, you could kind of carve out a little niche there. And then the people who, you know, the other agents were like, well, this guy’s invaluable, right, because this is this is a huge chunk of my clients work is coming from Yeah, this guy, so kind of a setback because you kind of have your heart set on one thing and you know, there’s always so it’s kind of the forks in the road, right.

Mike Ayala 7:57

That’s so true. A lot of times investing for freedom. We talked about the formula. What do you really want? Why do you want it? What are you going to do to get it? So yeah, that’s the thing that investing for freedom, we’re constantly talking about what do you really want? Why do you want it? What are you going to do to get it measure results, but then adjust, right? Because a lot of times what we think we want in life, as was your story, I mean, it’s, as you really move through things. It’s funny because sometimes that shiny object or the title, or the power position, isn’t necessarily your core strength. So it’s such an interesting point. What is the piece of advice you find yourself sharing the most?

Andrew Lanoie 9:06

I think it’s kind of goes back to being a connector. It’s really listening. We have a few good common friends who one of the I’m trying to think of the exact phrase, but it’s like, you know, everyone, a lot of people in conversations, they’re so eager to, they’re not listening. They want to just jump into their next question or whatever it is. So it kind of goes back to being just curious and being a connector and listening. If you really listen and you try not to think it’s an inherent in us, right? We want to you say something, and I’m like, oh, well, I have to say this. And so I want to get it out without actually listening to the rest of what you’re saying and the rest of the sentence of the paragraph. So I’d say that’s, that’s probably a good piece of advice I learned through other people is just try to listen more. Yeah. And understand, you know, some interest perspective. And I think that along with it’s a, it’s a camera with a quote, but it’s like, everyone’s battling something, right. And so you’re on the street and you walk by someone and they’re having the worst day and you’re like, what’s wrong with you? You know, and it’s like, well, their mom died this morning, right, or something happened. And you know, and I have to remind myself of that, because I because you will think naturally kind of forget that, but everyone’s going through stuff. Yeah, you know, so totally, I think. I think those two things are, are pretty important, at least in my life.

Mike Ayala 10:33

Yeah. That’s so interesting. Shut up and listen and be curious. I’m paraphrasing, obviously.Yeah, I like it. Start her own Amazon store. Great. So I kind of want to usually we go back to the beginning, but I kind of want to just have a quick discussion on you know, so Andrew and I, for those of you that don’t know, we’re business partners at Four Peaks Capital Partners, we’ve got a couple companies Park Place communities management and workplace construction. We’re in the affordable housing space. Do you want to just talk about what that is and what that looks like today?

Andrew Lanoie 11:09

Yeah, I think. So we’ve been doing this as a company. I mean, you’ve been in the space for probably about 13 years now just on you and Karen and all prior to sub crash subprime. So we’ve probably we’re going on six years of doing this. And when I was buying a bunch of single family homes back in 2009 1011 12, that time period, things really just kind of stopped pencilling out on the single families and it got really expensive and if you’re trying to do something for buy, buy and hold, it was really difficult to start to find assets that worked and so that’s really how I got into it is I had a friend who bought some parks and really took a good look at that model. And about six, seven years ago, it was like that space was not as talked about, as you know, everyone, everyone was really interested in single family or multifamily or commercial and things like that. And the affordable housing space I think was a redheaded stepchild, but it just wasn’t talked about as much and it just wasn’t as known. So, you know, and through all this, I think, I think a formal housing is done, done fairly well through all of COVID-19 and, and all of that. I mean, I certainly wouldn’t want to be an office building owner right now. A lot of retails getting hit pretty hard. So it’s interesting to see. You know, we’ve got the markets that the markets booming. We’ve got residential real estate, you know, I talk to people all the time and always ask them hey, in Salt Lake City, like, like, you’re here in Phoenix, if you’ve got a home at 350 grand, there’s 10 or 20 offers on it. Yeah, anything lets blow a jumbo loan. And so we haven’t hit the top of the residential real estate market yet. And so when I talk to other folks in markets, it’s kind of the same thing, whether it’s Salt Lake or San Francisco or Austin, Texas or wherever. So there’s all these just interesting things happen. You’ve got rates are at all-time low. The stock market is booming real estate, we’re not really we’re certainly not a real estate crash. I don’t know if we’re technically in a recession yet. We don’t know what what’s going to come out on the other side of this, but you’ve got, you know, all of these big, big, big companies that have been around for a long time, like Men’s wear house and Cheesecake Factory that are starting to default on, you know, on loans and bonds and things like that. I don’t I don’t think most of the courts have even been open really through a lot of this or maybe it’s just certain priority things. So it’s like, what does this look like in six to 12 months When some of that’s been chewed through, right, and all of a sudden, it’s like, wow, there’s been, you know, like what it can when it, you know, our good buddy Ken said that there’s 30% of mortgages are going to fail or something like that and some huge number. I mean, that’s, that’s everything right. That’s residential. That’s commercial. So, yeah, certainly an unprecedented times, but just trying to watch all of these variables and things. And just because no one knows what’s going to happen, but I think interest rates are going to stay low for a while. Sure. I don’t think we know the level of damage to the economy yet with all the money that’s being printed. Whether its hyperinflation, or we just don’t notice. Right. Well, I heard Jerome Powell, I think it was yesterday. The Fed Chairman, he said, he said the only way to really get through this is to make sure that people everyday people have access to credit. Which means you know, they’re going to do everything they possibly we can to keep financing and lending because if people can’t borrow money, then they won’t spend, right. And there’s just so many interesting trends and a lot of times, and I love, I love where you go with this because, you know, a lot of times even when I’m listening to whether it’s Jerome Powell or anybody, it’s like, they’re talking such macro high level wordy conversations, right? You’ve got to be a finance guy from MIT to understand it, but the reality is, I love where you go with it. Because at the end of the day, the average American everyday people like us, just, you know, what can we do? And when you’re even talking about single family, I talked to so many people that still think right now is a great time to get into single family real estate investing, and I’m like, I’m not saying it is or isn’t. But you know, it’s like what Kiyosaki always says he’s when somebody says, hey, would I be a good investor? He’s like, I don’t know. What do you know about investing? Right? So you can still I get that you can still find good single family deals potentially. Yeah. But they’re rare. And with so I literally saw yesterday or the day before the Phoenix from May to May 9% increase. We’re number one in the nation for housing price increase. Yep. So if you’ve got a million dollar home, just simple math, you know, your house just went up by $90,000 in in 12 months. That’s crazy. It is. And so like, to your point, we’re not really in a real estate crash, right, Real Estate’s high, but we’re pumping all this money. So for the average person, though, and so back to affordable housing, I think what’s really going to matter at some stage and none of us have a crystal ball, but this can’t go on forever. Right? Housing prices can’t keep going up 9% per year, and that’s Phoenix. Not every markets that but I think you know, even a stable markets three to 4% per year, like housing prices can’t keep going up. Wages aren’t keeping up with that pace. Right. In fact, unemployment is at an all-time high. So how, how can housing prices keep increasing and unemployment? Be so high or wages even if unemployment wasn’t high, wages are flat. Right, but everything else is going up. And so how long can this really go on? And so back to the affordable housing conversation, I think whatever it is that you’re in, in real estate investing, you know, just looking at that critical non optional form of housing is important. Yeah. And it’s also back to whether Real Estate’s a good deal or not like single family. The answer is maybe the deal, just like you were saying, but it’s also know where you are in the market cycle, like are we at the bottom of the market? Not even close the by the market was after the subprime crash. And so here we are. 12 years later, right. Yeah. It’s like that’s and that’s also I think, a record right. Usually, there’s some sort of shingles. So is COVID a correction? Is it the beginning of a correction? We don’t we don’t know. Right? Yeah.

Mike Ayala 17:50

And that’s such an interesting point on the cycles too. And I remember like, literally for years, people saying, you know, roughly every seven years, right and we’re 12 into it to your point we’re almost double the normal cycle. And so yeah, it’s just its interesting time. But the one thing so back to the affordable housing in the manufactured space specifically, you know, when COVID happened, and even working through this, you know, just making sure that we protect our assets, and we still don’t know what’s coming, right. So, you know, we’re putting certain things in place to make sure that we have the cash flow to get through everything. But at the same time, we haven’t had high defaults doesn’t mean it’s not coming. But the reality is, in general, not coming. But the reality with affordable housing. Even if default start happening. In my opinion, affordable housing is going to be more necessary than ever. Would you agree with that?

Andrew Lanoie 18:43

I would agree. I think the big question is when it’s affordable housing is already in demand. So when is it a greater demand? Is it is it more is it a hockey stick? Yeah. Or is it is it more of a straight line to it? What’s interesting, I haven’t seen the latest jobless claims, which I’m sure they’re down now. But I think we were close to 50 million. I think it was pushing. Yeah. Yeah. Or maybe I don’t know if it was north or south at that, but so 50 million jobless claims is astronaut, astronomical, right. So that’s a four and a half month period. Typically, I think I looked at something like February to February, right, 19 to 20. And it was a couple hundred thousand a month. And so it went from 200,000 a month to 50 million over four, four and a half months, she saved five months. So what happens in six months from now? Does that mean half of those folks are back to work? What happens when government assistance runs out? And the person who decided who’s making $14 an hour decides to stay home because they’re making more money? Yeah. And all of a sudden, there’s no those jobs are gone, because the people who said Well, I’d rather go work and have my foot in the door somewhere. Because this money isn’t going to last forever, the resistance is Yeah. So like, there’s so many of those variables we just don’t know. Yeah. What happens if unemployment goes to 40%? Yeah. Does that affect all residential real estate? Maybe, right. I mean, I feel like affordable housing is probably the most protected. Sure, you know, whether you’ve got C and D class, apartment buildings, whatever it is, but it’s still it’s still just unprecedented numbers. Just don’t know.

Mike Ayala 20:27

Well, and you know, Kenny McElroy have said this several times to us, you know, just like looking at history. What happened last time, but I heard him say, I don’t know, it’s been a few months ago. But this is unprecedented. And you were just kind of hitting on that. So there’s certain things that we can look backwards and say, Okay, here’s what happened then. One of the normal trends that happens is, you know, in a in a correction or a reset, like 2008, a lot of people lost their homes. And so as people were losing their homes, they needed to move into apartment buildings. And so all of this is a kind of a short term. Issue and it takes some time for that all to flush out. But I think what we’re seeing right now, I’ve been talking to a lot of realtors just kind of trying to figure out what’s happening. And I think a lot of people right now are because of COVID, which is completely different. They’re actually a lot of people are moving out of city centres. They’re moving out of apartment complexes because they were trapped with two and three kids that used to go to school, and now they’re trapped at home and the kids can’t go outside and play. And they’re having to go from story number three all the way down and they’re worried about touching stuff. This is all unprecedented. Yeah. And so people are moving out of apartments, to houses. This is one of the things that our realtor that I was talking the other day to this is what he was saying part of the demand is people are moving from urban areas to more rural areas. And that could be even like a California to a move to like a Texas or an Arizona but even that people are moving out of like a central Phoenix to like a suburb, right? Because they want a little bit more room and there’s not as much chaos. But that being said, the reason why I’m saying all that this cycle could be a little bit different because people are moving out of apartments right now and into homes. But the thing is, is when people start losing their homes, the trend is to go back to whether it’s apartments or, you know, manufactured housing or whatever. So it’s not going to be exactly the same. But no matter what, to your point, when something like this happens, the demand and need for affordable housing is there. And if people start to lose their homes, and as a real estate investor, we never ask or want that. But the reality is, you’re there to fill a need.

Andrew Lanoie 22:30

Right, right. And I think what’s so interesting is this. There could have been a counter argument to that years ago, where you would say, Well, if you look at some of these, let’s just say tertiary markets in the Midwest, and maybe there’s not the huge job centres there but you’ve got maybe an Amazon fulfilment moves in and it’s the Walmart’s and the Costco’s. And the like really the service industries right, the essential service so You could you could argue that there were less people in those markets and they started go towards like a Dallas, Texas because Dallas was growing and what was downtown Dallas 10 years ago is no longer that’s on the outskirts now, right, or whatever those examples are, especially areas that are not landlocked. Right. And then now we’re seeing, I think, what feels like is a lot of people that are leaving these big markets to go to, well, we don’t have to work at the office anymore. We can work anywhere. So do we want to stay in our very expensive apartment in New York City? Or do we want to move to a suburban Connecticut where it’s less expensive, and you get at, you know, quarter acre of land? Your cities, obviously, a very extreme example. But so what happens to office building and that, you know, there’s certainly tech companies that are like our employees can stay at home forever. So how much what’s the percent that follows suit? Yeah. And then how does that so that’s going to take a while to really trickle down. I think Yeah, totally. Yeah, it’s really interesting.

Mike Ayala 24:03

Well, even in our company alone, I mean, we’ve found that there’s a small percentage of our employees that actually need and I say need in a with a light footprint, need slash want to be together? Right? You know, we’ve realized that even certain departments don’t necessarily need to be together every day. So and I think that a lot of tech companies are looking at that too. I think I saw on Twitter, there’s like, 18% of their workforce that actually fill they feel like needs to come back to the office at some level. So it’s, it’s interesting. Yeah, that’s a great point. So back to what you were talking about, whether it’s unemployment and, and the level of unemployment. So all of this additional unemployment and all of that is not actually adding to the economy. It’s filling a gap that existed right so people have this false sense that there’s all this additional capital and stuff flowing into the market, but it’s really not. Because that that, you know, 2530 40% unemployment, those people are getting taken care of by the government, we’re getting our stimulus checks and everything else. But the reality is that’s not additional money or capital that’s flowing into the market. It’s just filling a gap that existed. And so that’s another thing that and I don’t want to get too in the weeds on that. But the reality is, I think there’s this false sense that people feel like there’s a bunch of extra money, but there’s really not they’re just getting money that they would have had anyway. And so I think the effects of that are going to be hitting that’s real shortly.

Andrew Lanoie 25:42

The other side to that I think, through one of my one of my friends here in Arizona who said they, they had a friend who owns I think, maybe some [inaudible], I think in Once that first stimulus check, hit that 1200 dollars, there were certain retail, like a Best Buy that literally had not record setting but really strong money during that time. So that was someone that got that 1200 dollars and whether they were out of work or not, they’re like, well, I’m going to go buy an Xbox or a computer. Yeah. So some of that happened. Yeah, even though you’re right, it wasn’t. That’s that was filling that was filling a gap, right? But some establishments, really, I think, profited from that.

Mike Ayala 26:32

Well, but it’s the same conversation. I’m not saying that people aren’t spending that money, right. But people feel like its extra money. Right? And it’s really not extra money. It’s just feeling they might be making a little bit more on unemployment. But generally speaking, it’s not really extra money. That’s moving through their hands. It’s just catching up. And so that I think that’s going to be a big, big part of the problem when that music stops. There’s a big percentage of people that are still not back to work. In fact, let’s just use the number of 40 million. There’s 100 and 60 million working people in the US and so at 40 million, that’s 25% unemployment. Right. However you look at it. And so you know if that numbers that’s in the next few months, I mean, I don’t know how this plays out, but that’s the thing we have to watch for. But no matter what, it’s such a great strong argument for affordable housing.

Andrew Lanoie 27:21

Right. Right. The other thing that’s interesting is you think about some of the businesses that were created in the subprime crash, right, you had, you had Airbnb, Uber, and a couple others that were made a lot more creative, but those were some of the big ones. So a lot of innovation probably happening right now when you’ve got all these interesting things like 100,000 person sports arena, or a stadium, right and so for a while, it was like, well, that’s where hertz, rent a car would park there, because no one’s driving rent a car. Yeah. So it’s like all of these things are happening and then hertz, I think filed for bank through their clothes. And even back to like a lot of the big box retailers, if you think about who went out of business Circuit City, right? Yeah. So Circuit City probably for years, probably felt kind of bulletproof. Right. I mean, the sales were up and people were buying electronics and Amazon hadn’t completely taken over or whoever that segment of the market were even malls. I mean, there’s some percentages like 21% of retail and malls are supposed to close in the next two years or some crazy number. Who buys a mall? Yeah, right. Well, maybe Amazon. Yeah, literally, or it’s going to get scraped and repurpose. But sure, you got all these things that change and some of them very slowly and then some of them really fast when you go through something like this, right? Like imagine like a Dodger Stadium and the real estate that that sits on Yeah, in the parking lot. You’re dead in the water.

Mike Ayala 28:53

Totally, so interesting. I heard that Mall of America just defaulted on their first payment of $1.4 billion. Like, who, number one? Can you imagine that kind of payment, but that’s for a month, they just defaulted on their first month payment of $1.4 million. And to your point, like, who, even if, who owns that loan, that’s the crazy part who owns that loan? And it’s probably, you know, a cmbs package of for, you know, whether it’s life insurance companies or whatever, somebody owns that loan. And 1.4 million just got defaulted on. And there, they’re, they’re not, they’re probably not going to get any better anytime soon. And so right to your beginning point, I mean, this this could go this go could go pretty deep. So there are certain obviously markets of the investment segment that we’re just glad we’re not in like Mall of America. Yeah. And to your point on bulletproof I mean, Circuit City probably thought they were amazing. Whoever owns Mall of America probably thought that that was going to go on forever, but we just don’t know.

Andrew Lanoie 29:57

Yeah, in malls head when did mall. Start? 50s right or 60s, so it’s like, I mean, when I was a kid, that’s you went to the mall, right? That was a big deal. So I mean, malls had a good had a good run. The other thing too, which is so interesting, it really just impacts residential real estate is. So Chase, maybe about two or three months ago changed their parameters, right? We went from, I think it was you could be in the mid sixes for FIFO. And you know, put 5% 5% 10% down. So they went to a 700 FIFO and 20% down minimum came over the other banks, the other big banks followed. But imagine being in the middle of a loan to get a home and then COVID hits changes you don’t have 20% down to 680. FICO. Yeah, so we you have to go rent, right? So we hear renter nation all the time. And I think that that’s where a lot is heading I think for a while it was very negative to rent, right? And be a renter, but I think that’s, I think America in general is growing as not being single family, homeowners. That’s just the reality.

Mike Ayala 31:06

Yeah, it’s so interesting. So you have a podcast called the impatient investor. And we’ll get into that a little bit more where people can find you later. But you talk about you have a lot of great conversations on there. And I’ve been saying this, like, the most important thing that anybody can do right now, in my opinion, is take some time and financially educate themselves. And you know, whether you’ve got money to invest or you don’t, financial education is the key to that. Because if you do have money to invest, you should have education, you should educate yourself, which is a big part of what you focus on at the impatient investor, right? Just the education piece. Yep.

Andrew Lanoie 31:41

Absolutely. Yeah, I think the biggest thing is, you know, some of the stuff is slow moving. And what worked for my grandparents doesn’t work today. Right. Right. And in general, like our parents and our grandparents had a very specific way that they this is obviously broad strokes, right? But they had very specific ways that they invested in manage their money. And that’s all out the window. But the fight there, there isn’t really an education system out there certainly isn’t in our schools or colleges, for the most part that teaches people, hey, you need multiple streams of income, you need to diversify. You can’t put all your eggs in the stock market, all of all of those things, which, maybe 50 years ago that worked. And today, I think, today just doesn’t work period.

Mike Ayala 32:31

Yeah. And I definitely don’t want to go off to conspiracy theory cliff, but at the same time, there’s a part of me that thinks that, you know, you go way back to where the Education Association was founded, and all of that and you think about America at that point in time, and it was the Industrial Revolution. They needed to take people off of farms and take them away from, you know, working in dad’s store to line managers. We went to a high level of production, right and so whether it was intentional or not, our education system was really designed to create employees. And then we go through something like this. And, you know, Ken and I were talking about it the other day, I mean, literally, the month before COVID hit, I was, I put a post-up and said that the average American is one pay check away from destruction, right? And everybody knows that everybody feels that but we put our head in the sand, and we don’t want to talk about it. And so whether it was designed or not designed, or intentional or not, the education system were a by-product of the education system. And so I think there’s nothing more important in this point in time it’s always been important, but now more than ever to get that financial education

Andrew Lanoie 33:39

Yeah, I think I mean, you and I met in a in a financial investment group, right? That was all about education and we’ve got good friends that are in that space and then both of us been on pretty heavy personal journeys through all this for years, right and when you start It’s especially if you’re in corporate America, you’re a W two person. It’s like drinking from a firehose, right. And you’re starting to read books and you’re learning more, and you’re like, wonder if that’s true. And could things be corrupted? And you start to believe that it’s, you know, so easy to, to say, well, COVID-19 and you start to politicize that, all that it’s kind of like, Well, I mean, I’d rather spend my time trying to be a better person and learn more, and I think people spend too much time arguing on the internet. So that would be another that’d be another takeaway that I would tell people is just like, don’t argue don’t be on the internet with strangers. Like that just doesn’t make any sense.

Mike Ayala 34:41

Well, that’s Barry saying and I say it all the time. But he always says, you know, get off your can do what you can and can the rest. I mean, there’s only so much you can do. It’s a waste of time, right? So what can I control? Well, what I can control is my inner mind-set, my inner narrative.

Mike Ayala 35:37

It’s like that it’s that saying it ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so. And we spent so much time, like you said, just trying to dig into all that. And the reality is theirs, there’s very little that that really matters at the end of the day on the education piece. So I think this is a good time to segue a little bit and get into your background. So tell us, tell us where you came from and where you got today because it’s such an Interesting, inspiring story.

Andrew Lanoie 36:03

Sure. So grew up in New Hampshire in probably sixth grade, started to play guitars, played some music. Heist in middle school, became good friends with friends in middle school who were also musicians. Got the bug and then in early High School, probably ninth or 10th grade, we started to put a band together and needed a drummer and I was playing guitar. So I went out and sell all play drums and bought a little $200 drum set. We practiced for maybe a year or two, we recorded 12 song demo and this is cassettes, right? So I graduated high school in 92. So this is, you know, late, late 80s, early 90s. We put a put a 12 song demo cassette together. And one of the weird a little small town in New Hampshire, Portsmouth New Hampshire area in some The big 50,000 watt radio station there, we won a what was called like a rock wars contest. And we did like two or three over time. And it was awesome. Like, you know, guys in their 20s and 30s, we ended up winning this contest and the radio station was like, we love you guys. And they ended up playing one song on this big radio station that went into Boston and kind of had this huge radius. And we started to sell just an unbelievable amount of records. Like we ended up selling 100,000 Records when we were in high school. And so I was the manager of the band and the drummer at the time. And we had, we were selling out this thousand seat theatre. We started to showcase our major labels we had like 12 major labels show up one time this is before we were even seniors starting to showcase in Boston, New York to try to figure out how to get us into bars and clubs at 17 years old, right? Just really wild. And so ended up signing a development deal with a label and graduated high school. And then the band kind of started to fall apart. The singer was who actually passed a few years ago was starting to use some really heavy hard drugs and the band just kind of imploded. But that kind of set me off on to I started to play in a few other bands and touring and doing that for probably into my early 20s and toured the country and did some really interesting cool things. And then that entire time I was always had some sort of an admin role. I was either the manager or as the tour manager, included in addition to being the bass player, the drummer or whatever. And so ended up moving to Los Angeles because somehow in my early 20s, I realized I didn’t want to be 40 years old and trying to be a professional musician. Because I was around we were in a really Big music area and I saw people who were in their 40s and just struggling and even though they were so passionate about it, I just wasn’t that passionate was fun. But um, you know, I was like, I’d rather go work in the music business. So I ended up moving to Los Angeles, I know probably 23 years old or something like that. And got a job pretty much right away in a little record label and kind of put me on this path in the music industry and then realized that I had connections with a lot of labels that have come to see us and so it just started calling those labels and saying, Do you have internships Do you have anything? And maybe about maybe about two and a half years later started to interview at William Morris, which is the big talent agency and we the ad package, the show, entourage, created that show which is all Mark Wahlberg is kind of coming up to the industry with his friends and everything. At the same time, kind of a side story the same time I started to get the itch to play a little bit play to go play bass. So I started working through ads in the recycler, which was all pre internet really, back then. And so started playing with this one band. And we traded music and got together two or three times. And they had just signed a publishing deal with a big publishing company called zamba. And went into this little crappy studio, rehearsal studio and they had like $60,000 worth of brand new gear. I’m like, how did you guys get this and what’s happening? They’re like, oh, well, we just signed a publishing deal. So did that played with them a bunch of times they ended up going with the other was I was the runner up bass player for that band. Got the job at William Morris, which is like a six month interview process, which is just pretty wild. Working at William Morris, and probably a year goes by and my friend called me who was managing the Goo Goo Dolls and he’s like, that band you played with just put out their first record and they sold like 650,000 albums first week and it was Lincoln Park. So pretty funny, right? So I’m at William Morris making like nine cents an hour as an assistant.

Mike Ayala 41:10

Because you’re working so much.

Andrew Lanoie 41:11

Yeah, well, just cuz you know, the assistants get punished, right. Yeah. You’re making you’re barely making minimum wage. But that was what I was there to do. Right. It wasn’t there to that’s the fork in the road. Sometimes you can control the fork. Yeah, sometimes you can. Yeah. And so that kind of set off. And I worked at William Morris for 16 years and represent comedians and bands and had a really good, really good run. It was a great gig great career. And really just I got into real estate probably 2008 and nine during the crash, which was just great timing, accidental timing, really. And sometime around that that time I was like, Well, I don’t want to be 70 years old and being a talent agent and having a W two job even though you make a ton of money and just I just wasn’t I wasn’t built for it. So I just started to put together an exit. And it was actually through buying residential real estate that kind of got me there, put a plan together and said, I’m going to go buy X number of houses and exit corporate America.

Mike Ayala 42:13

Yeah. And so again, a lot of times I talk about the Adjust part of that formula, because I mean, I just listening to that, and there’s a few follow up questions that I have. But you couldn’t have seen, you know, from the beginning that all of a sudden your exit was going to be single family, right? Nope. And then it goes even further. I mean, you go from single family and did pretty well to manufactured housing. Right, right. So that’s why I think the Adjust part is so important, because, and I heard Gary Keller say that, you know, we tend to overestimate what we can do in one year, but underestimate what we can do in 10. And so when we’re setting our goals, and really thinking about what we want, I mean, obviously we have to set goals, and we have to measure those results. But at the same time, if you hadn’t been flexible enough along the way, to follow your intuition. I mean, you may have missed opportunities too.

Andrew Lanoie 43:01

Yeah I think the intuition part is you could probably do just an entire podcast on that alone just having intuition and following that or not following that. What’s funny is I was probably more of an entrepreneur early on right because I was paper routes and how do I you know, how do I get that new bike? Well I got to go mow 100 lawns and you know just driven to do that kind of stuff the whole band thing and height in high school I mean you’re in a you’re a little business right and you’re kind of battling the world and someone has to be the manager killed all the crap and negotiate on places to sleep all the stuff right all everything that goes into call the club’s pounding the phones, so come on, let us go play your club and all that stuff. And, and then and then moved out to be in the in, in in the business and the music business and ended up having a great a really great gig. And I think through all of being a W two employee in that in environment and you’re dealing with pretty wild personalities you’re dealing with, you know, very complex colleagues and all these, you know, negotiating and volume and, you know, all that stuff. And so each piece of that, you know, let’s say I’m on my third life right now my third career, let’s say, every single part of that had pretty cool lessons, right? And even the corporate America part, it was like a great lessons and certainly great relationships and friendship, friendships that came from that. So I kind of look at it like, you know, maybe back to the, you know, baby back to the, like, the whole concept of the American Dream is dead, someone would have a career that would last their entire life, right. So it would work at whatever car a car manufacturer for 60 years and get a pension and, and I think that’s, I think that’s all out the window, right. So, you know, having careers for having things that you’re passionate about that you’re doing for 10 years at a time or five years or whatever. I feel like that’s become the new norm.

Mike Ayala 45:04

Once again, whether it’s right or wrong, whether it was designed that way or not, it is a shift and whether we like it or not, that’s that is the new norm, as you said. And so I think where people get in trouble is they get stuck there. And by the way, we’re not against w two employees. I mean, there’s people that want to be employed, we’re thankful for them. Not everybody’s cut out to be an entrepreneur. But at the same time, even as a W two employee, you’ve got to change the mind-set thinking right? Because your boss isn’t coming to save you. I’ve been saying this a lot lately. I went to one of the posts that I think did the best was a post that we put up that said your boss will never pay you enough to be his neighbour. And you know, I hesitated even putting that up because we have so many employees that we love and appreciate. Literally some of our employees I’ve worked with for 12 years in different capacities. So there’s nothing wrong with being a double to employ, but you’ve got to shift the mind-set. When you said the American Dream is dead. That form of the American Dream is dead. Yeah. But the other side of that is that creates a freedom if you embrace it, the only, only you have control over, and it could be the best thing that ever happened. America was actually built on entrepreneurs, entrepreneurship, and people going out and hustling and working hard. And so whether you’re a W two employee or you’re an investor, it doesn’t really matter. You need to have multiple streams of income. I think that brings it back to you know, what’s important.

Andrew Lanoie 46:36

I think the other part of the American Dream is dead , I agree that America was really built on entrepreneurship, that was certainly people leading the way and leading the charge. And just as important to that, if you worked really hard as a W two employee you could have one job you can be taken care of, yeah, you can take care of your family like on one. You know, we’re not you’re not a millionaire, right? You’re not making a million dollars a year, you’re making a hard working salary, lower middle class, and raise kids and own a home and all of that. And that’s, that’s for the most part out the window. So there’s very little loyalty in that format anymore. I think. It also it’s pretty, pretty clear that just salaries haven’t kept up with expenses. So that’s a big thing. Right? So you were making X dollars back in the 50s. And that had a lot more buying power than it does now. Right? Like, how many how many? We have so many people in our world that have four jobs between mom and dad, right? And they’re struggling, right, like pay check to pay check. They can’t work anymore. Yeah, right. They’re working two jobs or three jobs between two people. That’s really tough. And so I don’t see I don’t see much of an end in sight in unless something drastic happens. Yeah, maybe it’s education. That totally changes. Maybe it’s I mean, I don’t think anyone has the answers, but that’s pretty clear. Right? That’s the path.

Mike Ayala 48:11

Yeah. Well, there’s a lot of things that are coming through COVID. And again, I’m, I want to be really careful, we don’t get political or I don’t have an agenda. But I don’t want to push agendas either. But there’s a lot of things that are transitioning right now to, you know, education. There’s literally, I saw a statistic the other day, and I love teachers, I love the school system. But the reality is, we’ve been saying for a long time, there’s problems with the school system. And I saw something the other day, the, if you take the budget for the school system across the country, the average classroom has a $285,000 budget. Well, now most teachers probably wouldn’t know that. And that’s, that’s a huge number. Now, it doesn’t mean that that classroom actually gets that 285,000. But if you take the entire education system budget, and the number of classrooms, it’s $285,000 per classroom. The average teacher makes I think, $62,000 a year or something like that. And so somebody said, whoever put this statistic up said, where’s all that other money going? Well, I did some research and the average high school that was built in 2014, cost $42 million. That’s the average high school. And so when you look at the high school facilities and the administration facilities and the busing and all of that stuff, there’s so much so what’s contracts with the builders?

Andrew Lanoie 49:33

Totally, And then the maintenance that doesn’t even include the maintenance? I mean, we’re in real estate investing. We know how much it costs to maintain buildings. And so yeah, the building cost $42 million to build, but what about the maintenance that’s required every year and so, you know, the frustration is constantly on the front line, you obviously you always see the battle between the teachers and the unions and, you know, the administrators like we’re not getting paid enough and that’s true. The teachers that are doing frontline workers, they’re not making enough money. I understand that. But the problem is the system as a whole. And so the reason why I’m even bringing that up right now is because COVID is going to adjust a lot of things. I mean, we’ve realized, just as we said, with, you know, workers and being having to go to, you know, retail buildings and commercial buildings. Well, it’s the same thing with schools. Do we actually have to go to a school building to get a good education? Do we actually have to go to college to get a good education? I mean, how many people went to YouTube University for the first time, in the last 90 days for free, and learned more about financial education than they’ve ever learned in school?

Mike Ayala 50:34

Yeah, probably a big percentage, right?

Andrew Lanoie 50:36

Yeah. A lot of interesting things coming from this period of time that we’re in it, but no matter what, it’s going to be painful. And back to the heartstrings things. You know, you when you said that, you know, a lot of moms and dads are both working two jobs. So a lot of households are working four jobs combined. You know, I don’t know where all that goes. But at the same time, we can’t put it in the government’s hands to solve that for us. We also can’t rely on our boss or someone else to solve that for us, we’ve got to get educated. And we’ve got to go out there and figure out what we can do. And the only way to get away from working for jobs is to change your goals. Change your perspective, and, and educate yourself in one way or another figure out how to go out there and make more streams of income. Right.

Mike Ayala 51:20

Right. And other than, you know, the, the folks that are that are working two jobs each. I mean, there’s always there’s always time in the day, right? I mean, you can that’s, that’s always a good excuse, right? Like, oh, everyone’s so busy. Which is true a lot of the time Sure. There’s always time right? You can you can watch an hour less a TV, you can read more, you can, you know, listen, listen, I remember when I started to get into podcasts, probably back in must have been like mid-2000, like 2005 or six or seven. It was incredible, right? And so instead of rolling calls on the way to work or whatever, or just making phone calls Like I listen to podcasts for an hour a day, right? And I was like, wow, I can almost get through an entire book every week, or a bunch of podcasts or whatever it is. So it’s powerful, right? But you have to want, you have to want to learn. Yeah. And if you’re if you’re stuck on that, and if you’re if you’re complacent and not happy, and aren’t willing to make changes, that’s, that’s kind of where you’re, you’re going to run some problems, I think, yeah.

Andrew Lanoie 52:28

I’ve said this a lot in the last six or eight months. I mean, I’ve lived it for a long time, but I can never really put it into words and the way it finally came to words for me until the pain of your current situation becomes stronger than the amount of pain it’s going to take to change that. You’re not going to do anything about it. And like you said, I mean, there’s always you know, there’s always more time in the day. The reality is, its excuses. Yeah, and I’m not speaking directly. You know, I know matter what, at the end of the day, our boss isn’t coming to save us. The government’s not coming to save us. So we need to figure out how to take that future into our own hands. And until the pain of your current situation becomes more painful than what it’s going to take to, it’s the same way with I mean, you know, my health is probably my weakest area, I hate exercising. But until that pain becomes you know, stronger than that, I’m just going to keep making excuses. Right? Right. So right, we all have them in different areas. But what I appreciate about you and I love your story, and I’ve just really I’m blessed to call you a partner. I just I love your perspective on everything. And you know, when you talk about not waiting to respond, you’re just you truly are a curious in you’re just an amazing listener. You’re a great support person. So you add so much value in your podcast where can people find you what what’s the best place for them to

Mike Ayala 53:52

Yeah, thanks and really been enjoying the, the work that that you’re doing and the guests you’ve had some pretty great guests. I listened to the last one I would listen to is the berry [inaudible] which is very cool for a lot of reasons. Right, because I’ve heard you talk about him so much. And the other is just like he’s just, he’s fascinating. Yeah, the way his brain thinks so it’s really cool. So yeah, the impatient investor, it’s, it’s, it’s pretty new. I think we’re on six weeks out six weeks ago. The impatient investor calm can find it on all major podcast platforms. It’s a little bit different. It’s kind of a shorter format, maybe one guest a month, kind of a thing and the rest of it’s just very topical and just taking and trying to peel, peel apart big, complex topics and try to make them as simple as possible, which is, which is challenging, but it’s been it’s been rewarding. It’s been a lot of fun. Yeah.

Andrew Lanoie 54:49

Well on that, you know, back to the education piece and how important that is. I think that’s why people should find your podcast and listen to it because there’s just a lot of great information that you’re talking about in there. That really does transform the way we think and the mind-set behind it. So, and you obviously put a lot of time and energy into the nuts and bolts behind it, too. It’s not just theoretical information. I mean, you’re very skilled at it.

Mike Ayala 55:11

Yeah, thanks. Appreciate that.

Andrew Lanoie 55:12

Anything else you want to talk about.

Mike Ayala 55:14

No, I’ve been looking forward to this. And it’s been a great time hanging with you.

Andrew Lanoie 55:17

Yeah. Appreciate you, man. Yeah, appreciate you.

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Episode 45