How to Think Like a Bank: A Father-Son Blueprint for Private Lending, Predictable Returns, and Family Legacy with Dave and Josh Stech

0:01John Lee Dumas:Boom! Shake the room, Fire Nation. JLD here and welcome to Entrepreneurs on Fire, brought to you by High Level, the all-in-one sales and marketing platform. Today we'll be breaking down how to think like a bank, a father-son blueprint for private lending, predictable returns, and family legacy. To drop these value bombs, I brought to Dave and Josh Stech and EO Fire Studios. Father and son investors teach high earners how to think like a bank. Dave built a private lending track record through multiple cycles, and Josh is the CEO of Sunday and ExKiavi. They are also hosts of Just Be The Bank. Today, we talk about the money game awakening, the turning point to becoming the bank, the family strategy, the next generation layer, and oh, so much more.

0:42John Lee Dumas:And a big thank you for sponsoring today's episode goes to Dave, Josh, and our sponsors. Fire Nation, are you ready to make 2026 your best year yet? It's time to start your transformation by attending the world's highest rated business growth conference taught personally by Clay Clark and featuring football star and entrepreneur Tim Tebow and President Trump's son, Eric Trump at thrivetimeshow.com slash EO fire. Again, request life changing tickets today at thrivetimeshow.com slash EO fire. If you are building a real business, you need real infrastructure. High level gives you website hosting, funnels, email marketing, automation, calendar booking, payments and course hosting all on one platform, plus award-winning 24-7 support.

1:24John Lee Dumas:Get a 30-day free trial and my full bonus stack that includes a 50-minute private call with me and much more at highlevelfire.com, highlevelfire.com. Dave and Josh, we have them here, Fire Nation. So say what's up to Fire Nation, you two, and start by sharing something that you believe about becoming successful that most people disagree with? And Dave, I guess, age before beauty. Well, I appreciate that. And well, that was a question that's got a few meanings to it, I'll say. The truth is, for me, it's pretty easy. I believe networking is way overrated. We're taught that you need to network, have more people in your life, and it's actually the exact opposite.

2:09What you need, what we all need is fewer, better people in our lives, not more. Because the more we have in terms of relationships, the more dilutive those relationships are. So at least for us as a family office, our mantra is pretty simple. We do fewer, bigger things with fewer, better people through fewer, deeper relationships. I love that. And thereby avoid the masses of asses. so yeah well i love this question it reminded me of something that peter teal i think interviews people with oh cool when he's looking looking to hire him and peter actually funded sunday in its first round so uh that just reminded me but look i think most people believe that they can produce outer abundance while living in inner fear and i i think it's subconscious that they believe that i I think they think their inner world bends to the outer world.

3:01And I believe the opposite. I think the outer world will bend to your inner assumptions. You just really got to believe that. And so this isn't wishful thinking. My advice is to assume success, don't pursue acquisition. And I think most people get that backwards.

3:16John Lee Dumas:I love that. And I will say after interviewing over 5 ,000 people, I often get asked, what's one just unbelievable common trait that these successful entrepreneurs have? And for me, it's confidence. They are confident individuals, and that just breeds so much else. Now, I want to talk about the money game awakening, because Dave, you have quite a journey, brother. Take us back from scarcity thinking to corporate success to the realization that financial rules were quietly stacked against these poor wage earners. What was the moment you saw the game for what it really was? And of course, as concise as possible.

3:52To begin with, I don't remember starting with scarcity thinking. I was just poor. And it was a fact. I mean, I'm growing up in a trailer park for the first 20 % of my life. My parents had eighth grade educations. They did the best they could. And it turned out it was good enough because I was hungry. I mean, literally and figuratively, I was hungry. So I ended up going to college, then corporate America, because six figures a year sounded good. And it turned out to be very comfortable. And then I realized that comfort was the silent thief. I was literally settling, both for myself and for my family.

4:32And I realized that comfortable is where dreams go to die. So I became an entrepreneur. Thankfully, I got recruited to be one. And it's not easy or quick, but I eventually reached those three levels of freedom that I wanted, financial, time, and global. And now we're kind of referred to by a lot of people as the most successful private lending family to real estate investors in America. Now, how crazy is that to start from a trailer park and be there and for my son, Josh, now to be outgrowing me? Pretty crazy.

5:03John Lee Dumas:I mean, what else could a father possibly want? Now that I have a two-year-old son, Beau, I'm just looking at the world in a completely different lens. So I definitely commend you, Dave, for A, what you built from where you started to where you are now. And Josh, I have no doubt that you are very grateful for the hard work and sacrifice your dad put in to get you to where you're in a place right now where you can do all these things. But of course, you had to execute on your own, brother. So I want to talk about the turning point. I want to talk about becoming the bank because, Josh, you eventually went all in as an operator.

5:34John Lee Dumas:I mean, you and your dad. I mean, you took real risk. You learned firsthand, like why being the bank actually beats being the operator. So what did this shift teach you about both control leverage and I guess as well, long term wealth? I think it was really important to start as an operator is now I look back and think about what it means to be the bank. It all started with the lessons that we learned as a property investor ourselves. So how to underwrite, how to manage contractors, how to lease properties, how to sell homes. I mean, and ultimately that there's a ratio we focus on a lot in the Steck family office called the effort to return ratio or the amount of money that you're making for the amount of work you're putting in it.

6:14It felt off when we were in that property investor's seat. And we were making a lot of money, don't get me wrong. It just didn't feel scalable. It felt like we were hitting the ceiling consistently, and we just couldn't break through it. And we learned with private lending, it has no ceiling. You find repeat borrowers, you simplify the business with software, and the sky really can be the limit. And one thing I really have embraced more, to your point, John, with kids, I have three. a nine, six, and a four-year-old is it really, the more of a backpack business you can have, if you can just have a cell phone, a laptop, and you can be anywhere in the world and do what you need to do, that flexibility, that time freedom, that space freedom is something that you just, you get with being the bank that you don't as an operator.

7:03John Lee Dumas:This is powerful stuff. I mean, Fire Nation, I really hope you're understanding the process that both Dave and Josh went through to get to this understanding, to this knowledge that is so powerful when you have it and now how you can apply it. So I think that moves us, Dave, into the family strategy because private lending became your family's financial home base. Now share with us why this model stands out as a way to generate predictable returns and of course, preserving your capital and staying resilient through these different market cycles that we're always seeing and that seem to be coming at us at a faster and faster clip.

7:39Yeah, you probably remember this, John, when we got together at your place and you and I were sitting around the pool talking and we were reflecting back on the first presentation I did at Harvard, the first state of the union for real estate investors that had ever happened. And I was talking about market cycles and talking about timing being the most important word in life and the most important word in investing. And so you think about what we've had to learn when we had no playbook, we had no one to coach us, and we didn't figure it out overnight, we almost fell into where we are now. Because Josh finished grad school at Stanford, I convinced him not to be a consultant or an investment banker, but to move to Vegas to flip homes with me because I'd just done the State of the Union at Harvard.

8:27And in 2008 said that 2010 would be the year where Vegas would be the number one buy market in the US. And we're the only one buying homes. And here we flipped 73 homes in our first 14 months, which is like one flip every six days. It was a grind. But then there was a lot of distress that allowed us to buy a $2.8 million home from the bank for, I think it was$618 ,000, fully furnished. And it turned into our first vacation rental in the same year that, oh, by the way, Airbnb launched. Well, that short term rental business became another grind. So we had one grind, we added another grind, and realized that we were building jobs, not a business, that we were just grinding it.

9:13Well, we then sat down in our little conference room and said, what are the 12 wants that we'd want in any business? And what's the one overarching thing we've got to solve for? And Josh talked about it earlier, effort to return ratio. What can we do where others do the work, we write the checks and get bigger ones back. That became private lending. So think about that for a minute. And just think about the bank that you have a mortgage with right now. You write a check and they get a bigger one back over time. While you're doing all the work, interest income shows up in their account or as a private lender in your account every month.

9:52It's tax-free in your Roth. You and your money are in the safest position in the deal. You've got plenty of cushion and you get paid first when the deal closes. You don't have the downside risk of owning real estate. This is a big one right now. You control real estate with paper without the risk of ownership, which is really important when you're at or near the peak of a real estate cycle where arguably we are now. And I think the big one Josh talked about was how would you like a backpack business where you can always find me at one of my 38 ,000 offices in the world called Starbucks. And the biggest thing, and this is back to the point that you made about your two-year-old.

10:33If you can teach your kids how to be the bank, they can outgrow you like my sons are. Because what you don't learn, your kids will inherit. And that's why it's incumbent upon you at every age to do whatever it takes to make sure that your kids are set up for success, but not to give them success on a silver platter. so that's kind of where Josh is right now

10:59John Lee Dumas:yeah and I love hearing all this and that's kind of one of the things I'm trying to balance again with my son right now and I'm also really resonating with that backpack idea I mean Umacal the town that I live here in Puerto Rico actually just got our first Starbucks so I'm like alright I can go down the street now and have a nice day and just hang out and you know flip the laptop open and do some things and you know Kate and I are going to Spain for two weeks in May and then Maine for two months in the summer than San Diego in the fall for two months. And I'm able to completely pick up my studio and go and keep the business going wherever I'm at.

11:32John Lee Dumas:And that's the business that I intentionally built. And Fire Nation, this is a powerful thing. Now, Josh, we have a lot to talk about. I mean, we're gonna be getting into the next generation layer with you coming up as soon as we get back from thanking our sponsors. If you've ever tried getting a traditional bank loan for your business, then you already know that it's not exactly fast or easy. Between rising costs, tighter lending standards, and all the hoops you have to jump through, it can feel like you're stuck waiting when your business needs capital now. That's why I want to tell you about Revenued.

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13:54John Lee Dumas:Schedule a free consultation and request tickets to join football star and entrepreneur Tim Tebow and President Trump's son, Eric Trump, at Clay Clark's next business conference today at ThriveTimeShow.com slash EOFire. Fire Nation, if you are building a real business, you need real infrastructure. That is why High HighLevel is Entrepreneur on Fire's featured partner. HighLevel gives you a website builder and hosting, funnels and landing pages, email marketing, appointment scheduling, payment processing, course and membership hosting, and so much more. Everything you need to succeed, all under one roof.

14:27John Lee Dumas:No duct tape, no juggling five platforms, just one clean system for your business. And their award-winning 24-7 support has your back when you need it most. When you sign up at HighLevelFire.com, you also get my exclusive bonus stack, a 30-day free trial, a private 15-minute call with me, JLD, access to my weekly live office hours, a digital copy of my book, The Common Path to Uncommon Success, my 50 Days to Something Execution Roadmap, and more. Visit highlevelfire.com and start building your something today. All right, Josh, we're back. And as I kind of tease before the break, we're going to talk about the next generation layer because you bring an operator and fintech lens from platforms like Lending Home and Sunday, plus exposure to marketplaces and ventures.

15:14John Lee Dumas:So how did that experience reshape your understanding of risk, of scale, of capital efficiency? Those experiences of hyper-scaling businesses with venture capital, I mean, it's completely reshaped my understanding of what's possible, how businesses work. You know, it's not an experience a lot of people get. I actually, just before this call, John, I wanted to look up, how many people actually raise venture capital? I'd never even thought to ask Google that. And one in 2000 startup companies ever receive a dollar of venture capital. The other the other 1999, you know, do it some other way. Typically, it's bootstrapping with profits or they get a small business loan.

15:55But one in 2000 raised venture capital. And if only half of all American adults ever try to start a new business, that means only one in 4000 ever experienced what it's like to raise venture capital. So for better or worse, now that I've done it twice, I guess I do have a learning or two. And, you know, so you asked about risk scale and capital efficiency. In terms of risk, I think what I've learned is, and this is maybe going to sound a little corny, but I truly believe it is that only those who risk are free. And I feel like if you're not taking risk in your life, you're playing small and you'll never be free.

16:33I think in terms of scale, I've learned that large scale only works when everything works at small scale. This has been, some people think that scale will solve all your problems and it will cure the world. It only will if your small scale is crushing it. Everything has to be working on an atomic basis at a unit basis. Otherwise, it won't scale. In terms of capital efficiency, I've really learned the difference between investments and expenses. When you're thrown, in the case of Sunday, we've raised$165 million of venture capital to build software and hire people and nothing to do with buying assets or homes or just to build the business.

17:16When you're given that amount of money, it is easy to be a little bit frivolous. It is easy to not understand the difference between expenses and investments and just make decisions too fast. So I think you need to really be clear about which check you're writing when it comes to capital efficiency. And then, you know, something just the final thing I'll mention that doesn't have to do with those three things is just, you know, what I've learned along the way now is you got to do what you love. And this is cliche. It's easy to say, but passion has to be at the center of it all. I've now not just started two big businesses, Fortunately, with venture capital, we've we've invested in nearly 100 other early stage businesses that were funded by venture capital.

17:59And we wrote a portion of that financing. And so now we've watched almost 100 entrepreneurs, you know, take their shot at it. And when when passion isn't at the center of mission, then you aren't compelled. You can't organize capital and people. You can't ever create something special. But when it is, when you truly believe in the mission, when you're compelled by a vision of a better future, and when you get that right group of early employees, early teammates around you, you have the beginnings of something really, really special. So doing what you love, again, it's so easy to say. And so usually I'll end with it and I'll say a lot of other things that sound really important.

18:37But honestly, that's the most important thing I've learned.

18:40John Lee Dumas:I mean, at the end of the day, Fire Nation, no matter what you do, there's going to be a grinding aspect to it, whether you like it or not. So if you actually enjoy, you have passion, you have enjoyment for that thing that you're doing, that grinding aspect is not going to just kill you. It's not going to grind you down to a pulp. You're going to be able to get through it to the other side. And this is where I want to move into talking about the family office mindset. And Dave, I want to talk structure. How did SDIRA's clear process and disciplined execution turn private lending into a repeatable system rather than just this risky hustle or some kind of side bet?

19:18Yeah, it's a great question. I mean, when people refer to us, you know, in our bestselling book, Just Be the Bank, as some private lending family in America that became Uber 6S, they don't realize that we only started 15 years ago. We started with one loan. We did it part time. And now we've done thousands and thousands of loans and became what I view as a private family bank. And then, of course, as you know, Josh was one of the four founding partners of that little company that became the largest lender in America. And now he's got Sunday, which will likely be his next unicorn. And the point of all of that is that our family bank became the key part of our family office because it allowed us to win the money game, to generate more income, to accumulate more wealth and to keep more of both by structuring it properly, either by living in Puerto Rico and creating an export business, as you well know, or investing out of our self-directed IRAs, which we're now doing three generations.

20:26Me, my son, my sons and my grandkids. So it's crazy to think that because I live in Puerto Rico like you, John, because I do private loans in a raw tax free self-directed IRA, you ultimately save what you ordinarily would have given away. So that allows you to make, as I always like to say to my sons, we make three types of money, obscene, ungodly and embarrassing. Any one of those is great, but when we do all three at the same time, that's like cheating, only legal, and it keeps growing. That's why structure is so important, at least in my view.

21:05John Lee Dumas:Yeah. And Josh, you might kind of want to block your ears for this next one, but I think I might have told you this, Dave, when we first talked. When I moved to Puerto Rico from San Diego back in 2016, I bought this incredible home just on the Caribbean, panoramic views. I never thought I could own a place like this. But in 17 months, I'd saved more in taxes that I would have paid in California than this house cost in the first place. And I've now been in this house for 10 years. And of course, the appreciation has been insane. That money wouldn't even have existed had I not made this risky move, as Josh was talking about earlier.

21:36John Lee Dumas:Sometimes you've got to take a risk. You've got to go out there and try something and test something. And then, man, you never know what the results could be. And now, Josh, you can unplug your ears now. I want to talk about bridging it to the listener. Because Josh, for someone who's listening right now, who's intrigued by the bank mindset, but they don't want hype, false guarantees, or let's say quit their day job quite yet, what does a smart, realistic first step look like? Boy, you're probably not going to find a group of people that is less hyped and prone to false guarantees. And I think that comes from having built businesses ourselves.

22:13ourselves. It just doesn't really serve us to overhype things, to promise things and then under deliver. And I think there is a tendency out there in the, you know, the info product space or the learn how to do things space where people do it once or twice. And then they realize, gosh, it'd be a lot easier to just teach people how to do this thing. I barely know how to do. That is, I think, where you get into the messy waters of hype and false guarantees. For us, we've done it. And so all we really want to do is just teach it. But we only want to teach it to people who are serious about it and who really want to learn.

22:43We don't want to lure the wrong people in. So I'd say JBB is a good starting place for that reason. But, you know, you said, I think we talk about doing it the right way a lot at Just Be the Bank. And, you know, we talked about risk. There's risk in any business and private lending is no different, right? Well, it's not a risk-free business. There's plenty of risk. And there are a lot of people who've been trained to do it wrong or haven't had the resources to do it right. So when we thought about creating something like Just Be the Bank to teach other entrepreneurs how to add a zero and how to do it the right way through the strategy that worked for us, private lending, you know, we decided to teach people how to identify and mitigate those risks, not put their head in their sand and assume they don't exist.

23:27So the things that we focus on in our workshop are how to structure deals and how to paper up deals to protect the downside, you know, how to use software to create consistency and reliability in your business so that no matter where you are geographically, you can build a business and you can win customers and you can have a wonderful life. So I think the first step of doing this the right way is to find an already successful. And this isn't different to private lending. You know, it's how did I start lending home or Sunday is I found people that had already done the thing I wanted to do. I stood on the shoulders of giants and I let them show me the way.

24:03So I think if you whether it's us or anybody else, my recommendation is find somebody who's done it. Oh man, there's a great effort for those who have heard the CEO of Airbnb talk about his approach to learning. His approach is it's, you know, there's, there's firsthand and secondhand, right? And, and he, he always says, a lot of people start with the secondhand version of learning. They start by reading books and reading. He says, look, I, I skip all of that because I can learn in 30 minutes with a conversation with the right person via firsthand knowledge, what it would take me 30, 40, 50 hours to learn secondhand.

24:38So I think you go to the source, you go to the people who've done it. And I'd like to think that we've done a pretty good job in this space.