265 - Best of 2025! Why Home Services and Affordable Housing Are the Next Decade's Biggest Bets with Justin Donald

24:37send it to me nick at cofounders.com and you will be entered to win a hundred dollar amazon gift card every four episodes i'm going to choose a winner at random and i'm going to do this five times five hundred dollars for five stars i just made that up it's what i'm calling it please go to apple or spotify leave a review screenshot it send it to me nick at cofounders.com and you'll be entered to win a hundred dollar amazon gift card all right let's get back to the show i feel like i'm in a similar boat i'm i think i'm one year into my master's degree i'm not two years yet a little bit different.

25:08I sold multiple businesses. So I don't have a passive stream of income that replaced what I was making. But I have this large nut that, you know, I obviously didn't have before. So I'm in the process of thinking through like, okay, what is the rest of my life look like? But I've had many conversations with my wife, because she's the same way of like, okay, what's our stability here? What's our level of comfort? Can we do XYZ projects, and I'm just not ready to commit to any one thing yet. I'm in that master's program. I'm a year older than you were. I'm 38, but I'm like, I don't know yet. I'm trying to figure out what I go all in on.

25:44Was there a moment when you were 37 that you were like, okay, I'm ready because of X, Y, and Z, or was it just time? Well, I think more than anything, it was that the plan was when my earned income was covered, we were good to go. And that was it. It was like, we hit the number. So I was like, okay, Well, now I don't really, I don't need to be doing anything else. So it was more that like we had this game plan, this roadmap, and we had a few years to hit it and we hit it and we're ready to make the transition. I was also ready for something new. I needed a new environment and surrounding of people that could help grow me into the next version of me that could help me think outside the box that could help me just understand the game of like wealth creation and investing and business building at a whole new level at a higher level.

26:37How old were you when you hit like a seven figure net worth, eight figure, you're probably nine or 10 figure at this point. But like, can you say like what those milestones were for you? Seven figure was probably about eight years ago, nine years ago. So right around the time that you left, 35, 36? Yeah. No, it probably would have been really close, somewhere between 35 and 37. Well, one important thing that I like to point out is I had financial freedom. So actually, it would have been probably 36 or 37, because I had financial freedom before we were ever a millionaire. But then we bought a bunch of properties way under value for what the market was.

27:19And we got just several killer deals. And those, you know, one of them specifically, we probably got for half what it was worth. And it later was appraised like 120 % more than what we bought it for. You have an interesting kind of growth trajectory because you were earning a lot of money when real estate values were just crushed after the great financial crisis. And so you started buying these properties at a discount and all of that appreciation that you were seeing, you could cash out refi and that income. Potentially you're, you're refying for a higher value than you bought it for. That income is not taxable and you could put that back into real estate.

28:05So you had like this flywheel compounding effect that was really special for those 12 years post, post a great financial crisis. at the same time though you've doubled tripled your net worth from business investments like it's not just real estate will you talk about some of the investments you've made since kind of pivoting into private investments yeah sure and really it's interesting because it took a long time to become a millionaire but i was financially free first so i actually recognized oh i thought i needed to be a millionaire i don't even need to be a millionaire because all i wanted was financial freedom right but it took me way longer to become a millionaire than it did to become a decamillionaire.

28:45So that one to 10 went actually really fast because we were able to cash out refi. Exactly what you said, bought a bunch of properties. From 10 to 100 plus was also a quicker transition, but we had other money. And this is where some of the businesses come into play. So I started a single family home maintenance company with a couple of friends and that really took off. What was that called? It's called Stellar Inc. Do you still own that company? Yeah, I'm still a part owner of it. We've got VC money in. So the VCs have control of that, but it's a great company doing awesome things. And there's like a sister company that we helped start as well.

29:23Also in the single family home maintenance space that has done very well. So those two have been huge. And from dollars to value, it was pretty exponential. So those, I can't get into the exact figures because there's VCs involved in one of them, but I invested, we're talking just thousands of dollars and have made a return of millions of dollars on each of those. And then those dollars got reinvested into some other companies that really took off. One company that we bought was a dog training company that ended up doing very well. And we timed it just right. It was during COVID. And I noticed that everyone was buying dogs in our neighborhood.

30:04Even people who didn't want dogs ended up with dogs in their house and they were just destroying the house. And I was like, oh man, I think a dog training company might make a lot of sense. And so we found this dog training company and we just totally cleaned house on the team, the staff, the processes, really cleaned it up and then boosted the SEO, made sure that we were doing the right work online, creating better systems, opening up the window for being able to book appointments, creating a demand, creating a wait list, all these different things. And so we sold that one at a year and a day for an 11x return on our money, which was pretty significant.

30:41And then rolled that into some other businesses. And then some of these, like some of what I invest, like today, even though I've done owner operator stuff, I've done some franchises, we do a lot more investing in, I want to say we, just my wife and I, like we do a lot more investing in companies that have a team in place. We'd rather be on the investor side. At scale, it's a lot easier that way. I know some people prefer to have more control. We don't, but we've had a few businesses that have really taken off in value and several that have had exits, several that are probably due for an exit in the coming year or two.

31:19The thing about real estate is if you buy right, it's hard to lose money, but you're probably growing it at like 10 to 15 % a year, right? Like your appreciation and like what you're able to do. If you buy something that's super low occupancy, and you can get the occupancy up, you can have bigger returns than that. But like, even if it's something's fully occupied, you're probably still going to be growing on average 10 % plus per year. So you got a little bit of a ceiling, depending on the type. Now business, you buy a business, you have way more risk because it could go to zero. But if you hit it right, you can have exponential returns.

32:00So for me, it wasn't that I wanted that. It's not that I think this is better than that. I think they're both great. And they both have pros and they both have cons. And I think that the better you understand those, the easier is to decide where to start, where to end or what to get involved in and what not to get involved in. I just happen to like both of them. And I feel like I've learned how to be good at both of them. So they both served us well. Starting in real estate allows you a safe base that then you can take some of the riskier bets, right? Like, oh, you know, higher risk, higher reward, but cool.

32:32I'll place my money in some of these places and you're diversifying your risk a little more. I want to talk about this thing that I find fascinating with you. You have real estate holdings, which are massive. You have business holdings, which are massive. You didn't say it, but you were an early investor in Orange Theory, which has done really well. But then you also have this business of masterminds. When I have seen individuals with masterminds, usually that's their business. And then they invest in these other things just to say like, oh, I'm a businessman. But I got to know you at Capital Camp.

33:07It's the total opposite. You love helping people. And for you, this is an opportunity for you to give people access to knowledge. Tell me, when did you launch your masterminds and why do you love masterminds so much? Well, I'm a huge fan of masterminds because I think it's the biggest shortcut to like growing your wealth, growing your education. To me, it's like the best money I ever invest into myself. So part of the reason I love it so much is because I'm in so many masterminds. I mean, I have two masterminds, but I'm in 14 others. And it sounds crazy. Back in the day, I was in one or two and it just kept growing.

33:44But this is where I learned. This is where I grew. This is how I upgraded my peer group to be around people that played the game of life and business at a higher level than me or people that at least like had aligned values, but bigger thinking than me. or that's really what I wanted. And so it cracks me up because you have all these social media influencers that have raised tons of money or they have their group and they've made all this money, but what they teach isn't actually what they've made money on. And in fact, they don't know much about what they teach. And in fact, we're starting to see a lot of these people having major slip-ups and people are starting to see that like they probably shouldn't have been teaching this.

34:26Right now in the marketplace, younger, naive, more immature investors or new entrepreneurs, they look for validation in number of followers. That doesn't validate how successful someone is, what their experience is. They're just a good marketer. They're just, they can collect eyeballs. There's a lot of hunger from people who are young to learn as well, right? They want to know. Justin, how did you make your first million? Oh man, in your mid thirties, you owned all these multifamily rentals. How did you do it? And they're willing to pay for it, which is amazing. But then there's these people who maybe they did one or two small deals and all of a sudden their business is now the business of educating you as opposed to actually doing those things that they're selling education on.

35:18And yeah, to your point, it's frustrating because you get labeled with this guru title, but there's a huge demand for it. People want to know how to get better, how to make money, how to invest. 100%. And I just think, I try and tell people in a day and age where everyone's a life coach, everyone's a social media influencer, and apparently the newest polls for what high school students want to be when they grow up, when they graduate is social media influencers, number one, which is really sad, but it's the reality. You got to be even more of a detective on who you're following and who you're going to take advice from.

35:52I only want to take advice from people that have done the exact thing that I want to do. They have a track record that is provable. They're not just saying they're good at something. They haven't just been doing it for a year or two. And now all of a sudden they make more money on the education that they sell via social media than their actual knowledge or expertise. So I just, I'll get off my soapbox, but that's the biggest thing and the biggest danger that I see out there. And I just thought it'd be really cool to create my own community. So I was part of all these other communities, but none of them had exactly what I was looking for.

36:21I thought, you know, to me, top of the rung, most important thing is like connection and networking. And I want a group where like every person is someone that I would love to connect and learn and grow with. So it needs to be like highly vetted and high criteria to get in. Number two is tons of education, education I can use today, education I can use for a lifetime. Number three is killer tax strategy. As you make more money, you want to be smarter about taxes. And then number four is deal flow, like vetted deals that we can get preferred terms on because we have purchasing power. But no one had a group like that.

36:56So I was like, well, what if I just build my own? And I created on those foundations, those become the pillars of our community. So five years ago, we started Lifestyle Investor. So the book came out. The book, the podcast, and the mastermind literally all came out at the same time. The Mastermind came out a little before the book, which a lot of people don't know. And then the book came out and then the podcast came out and they're all just weeks from each other. I never thought the book was going to be such a huge hit. I just put it out and thought if I had a few people that bought it, that'd be cool.

37:28I didn't have a social media following then. I didn't have a big network. I didn't have a big email list. I was really rather invisible on social media because I just don't really care for social media. I don't do a whole lot on it. And that book ended up becoming number one Wall Street Journal bestseller and USA Today bestseller. And as of last year, January, a top 1 % of all books ever sold by volume, which is pretty cool. And all the proceeds go to human trafficking. So this book is, we've donated hundreds of thousands of dollars on behalf of this book alone, which is cool. And the updated and expanded edition of the book just came out where we have, I don't know, 20 to 25 % additional content in there that I'm so excited about.

38:06And this goes live like any day, which is pretty cool. That's amazing, man. That is really cool to hear. And all the proceeds go to fight human trafficking, which is incredible. When we were at Main Street, I think the thing that I enjoyed most about you, we were at dinner and I met you, Levi, Bancroft was a banker was across from us. And I didn't know anything about you until like 20 minutes in. And I felt the same way about Levi. And I'd hope you guys felt the same way about me. It was like, we didn't know what your back, like how much money you made or what businesses you had. We were just having a nice conversation about life and like philosophy.

38:42And that's what I've admired about you. It just seems like that ethos flows through. So having a community that is focused on education just is a no brainer that it's associated with you. Well, thank you. I appreciate it. And it is a pet peeve to me when people posture based on those things. And it's like, hey, man, this stuff's all fleeting. You can be a millionaire one day and dead broke the next if you're not smart. And a lot of people use net worth and finances as a hierarchy or ranking system. Yeah, to me, it's just the worst. If you're going to have a scoreboard, that's the worst scoreboard because it's not a good measure of like true character.

39:24To me, the scoreboard's probably more like values, character, unique gifts like that would be, you know, are people truthful and are people putting the relationship before money and all that? Like there's so many better scoreboards, but unfortunately from a societal standpoint, that I think is what most people look at. I think that's what moves the needle the most for most people. It is. It's an easy thing to point to and people feel proud about it for whatever reason. But the thing I found crazy was you flipped out your phone and you were like, I'm a part of 14 masterminds. Like what? And you, you showed me the list.

39:58I took a picture of the list. Cause I was like, I never even heard of most of these. Are you comfortable sharing how much you spend a year on masterminds? Between coaching and masterminds, it's somewhere between 350 and 500 ,000 a year. So the private coach, so I've got a coach that I pay about 150 a year. And I'm generally in that price point depending on the coach. So maybe I spend, what is it? 150 to 200 ,000 a year on masterminds plus whatever, whoever the coach is for the year that I've hired. But for you, it's a no brainer. Like that's what we were talking. You're like, yeah, I get way more value than I put into it.

40:36What is it for you that you've mentioned some of the things, but like, what is it for you specifically about masterminds that's so powerful? Well, I think if you're looking at it linearly, and a lot of people do, they say, hey, I put in for your mastermind, like lifestyle investors, 55k. So I need to get a return of 55k in year one, like that's a very linear look at it. And though a lot of people do, I do think that's a bad way to look at it. Like, for example, what if you join and you save over 55k in taxes year one, but that same strategy allows you to save over 55k in year two, year three, year four, year five, And that's just one example.

41:14But for me, I like to look at it more abstractly where maybe some of the things I learn or some of the relationships that I make in these masterminds, maybe they aren't, the fruit isn't produced year one. It's in year three. Like that's when an idea actually lands or hits or a relationship that I met and nurtured actually sparks and blossoms into a cool partnership. Do you have any stories from that? I mean, tons. Yeah, there's so many where like, It's funny, there are some deals that I've done today that I would have never even had the chance at being an investor in these deals had I not created a relationship.

41:50I mean, we got one group that I invest with. I got to be careful not to mention their names, but think about, so this group invests only family office money and they invest with the biggest family offices out there and they typically do deals 100 % with that family office, right? So no one else is involved per deal. people who are listening, a family office, we just explained that really quickly. Yeah, a family office would be an organization that's built around someone that is wealthy enough to have a team and a staff that can do everything for them, manage their finances, do their investments, handle their estate, all that sort of thing.

42:26So some people get so wealthy that they develop, they hire an office, a CFO, they hire a chief operating officer, and they literally manage the family's money. These are multi, you know, a hundred millionaires, billionaires that we're talking about here. So that's a family office. So you've built a relationship with one family office that, go ahead, sorry, I cut you off. One investment group that they invest for the Ford family, they invest for the Musk family, they invest for the Bezos family, they invest for like, you name it, like this group does the work. And somehow I have been able to create a relationship to get in on investments with this group and alongside some of these families.

43:11Right. So it's that to me is that's like a return that you can't even like, how can I actually draw a return on that? Right. Like, how can I actually say the money I spent, you know, like just to get access to these deals and to have repeat deals. And now I've done several deals with this group, but like just access alone is worth it. Not to mention these have been really good returns. And there's a lot more deals in the pipeline. And it's just another level. So I've made my money back like a hundredfold on just one connection. That one connection covers all the masterminds I've ever done every year for all my life.

43:55What would you say to somebody young or who doesn't have the money to join a mastermind? like what's what or maybe they think they don't have the money to join the mastermind like what advice would you give to them you got to get clear on what you have to invest in yourself and what you don't i think you should always be investing in yourself so whether it's at the level i mean most masterminds are going to be somewhere between 100 let's call it 10 000 to 100 000 that's where most of our going to fall and i would actually say the majority are probably going to be in the$15 ,000 to$50 ,000 price range.

44:30That's going to be very common across the board. Do you have the ability to afford that? If you do, you should, but you should do your homework, do your research, and find the one where you can get a return on that investment sooner than later. If you don't, that's okay. Save up to the point that you can, but don't cop out and not learn. Like now it's like podcasts and books and taking people out to coffees and picking their brain, like be intentional. For 20 plus years, I have taken someone smarter than me in some area of life, someone that I wanted to learn from to coffee, lunch, breakfast, or dinner at least one time a week.

45:12I mean, I've even done this on vacation, by the way, but at least one time a week for 20 plus years. So the compounding effect that I've gotten on just those, that education, those relationships is profound. So before I had the ability to start a mastermind, I just created my own even early on. When I first started learning, podcasts didn't even exist, right? So what a great resource. I'd be all over, I'm still all over those, but I'd be all over those as a youngster in books and just anyone in the game of life at a higher level. I'm a big fan of just accumulating good people. And those are masterminds as well, right?

45:48And just finding people who are, they're also striving to be successful. They're trying to get to that next level. Somebody who's kind of in the same boat as you, Hey, let's do this together. It doesn't necessarily mean $50 ,000 a year to have access to that, but finding other individuals that you can share the wins and the losses with is just really valuable. But maybe just make a budget, maybe just say, Hey, this is how much I'd like to invest in myself this year. And then find whatever served that best. Right. Because when you were in college, most people went to college, you're probably investing 10 to 20 ,000 a year into your education there.

46:18Except now you can actually pinpoint it more accurately to like what you want to do and where you'll actually get a return on your investment. So it's funny, like people all of a sudden become cheap, like you're the poorest you've ever been in college yet finding a way to afford 10, 20, 30, 40,$50 ,000 a year. But then people are like, Oh, I can't invest this into myself. Give me a break. But I used to go through that. That's like the scarce mindset that I lived in early on when my parents and many people around me helped condition me to have this, this like poor mindset of like scrimp, save, don't buy that latte from Starbucks.

46:55Because if you don't do that for 20 years, the extra change compounded at such interest rate means you're a millionaire, whatever. I think you got to live life. And you've got to be willing to invest in yourself and invest in relationships. Amen. I love that recommendation. I totally agree with that. I got some rapid fire questions. To end this, you ready? Ready. What do you love about investing? It was part of the plan for financial freedom. Then it was that it just became a game. And it was really fun. It was fun to play like monopoly. And then it was, it's really boring just to do it myself.

47:35I really want to help my friends do it. And as my influence and peer group grew, it began to grow beyond just my friends that I wanted to help. That's awesome. What do you hate about? I hate when deals don't go as planned. I hate to lose a deal. I mean, that stinks. By the way, as an investor, it's going to happen. Every investor is going to have a bad deal, lose money. The best lessons are going to come from that. But what do I not like? I don't like when groups lie to you. I don't like when groups have bad intentions or don't do as they say they're going to do. That is a big pet peeve of mine.

48:09It's one thing if you miss the business plan and you don't hit projections. It's another thing if you don't have your investor's best interest in mind. You're invested in a lot of different industries. You've got real estate, but you also have businesses. What industry or business are you either the most jealous of or the most bullish on over the next 10 years? You're going to have to re-ask that one. Oh, I froze up? Okay. What business or industry are you the most bullish on over the next 10 years? On the real estate side, anything in probably more of the affordable or blue collar rental. Okay.

48:50Second to last question. If you have two hours in your day and you can do anything you want, you don't have family responsibilities or work responsibilities, what are you obsessed with right now? What are you spending your mental energy on? If it's just pure recreation, two-on-two sand volleyball or pickleball, I mean, I love that. But I mean, I read for an hour to two hours every day. So I love to read. I love to. I'm an eternal student. So I might even be able to make the argument that just becoming a novice in something and learning something, probably where I would spend at least half of that time, if not all of it.

49:30Okay. And if you had to give yourself advice, 27-year-old Justin Donald, what advice would you have given yourself? Start sooner. It's okay to make some mistakes. You're going to learn some great lessons from those mistakes. But if you wait to make moves, then you don't get that education early on. So you might as well start as early as you can and surround your and start being intentional with surrounding yourself with the right people that can help you learn and grow and also have your best interests in mind. Love it. Well, this was a fantastic conversation. Where can people find you? The best place is lifestyleinvestor.com.

50:06There's tons of things on there. We've got courses, masterclasses. I've got all kinds of free content, blog, a podcast, the books there. You can get that on Amazon as well. All the proceeds go to fight human trafficking. And something I'd love to do for your community, we do these strategy calls. They're kind of help people figure out how do I get from point A to point B, and everyone's in a different, unique situation or circumstance. And so our goal is to just help people take one step towards the direction of financial freedom. them. So we do these$500 strategy sessions, but for your community, I'd love to do them for free.

50:41So anyone that listens to this from your Nickonomics community, we'd love to host a free strategy session. If you go to lifestyleinvestor.com forward slash consultation, this has been a really big hit amongst the people that have taken the opportunity to talk with our team. That's amazing, man. Okay. So lifestyleinvestor.com slash consultation. I'll make a note of that and make sure we drop it in the show notes. That's amazing. I hope people take advantage of that because that's freaking incredible. Me too. This is, yeah, this has been awesome. I can't wait to come see you next time I'm in Austin.

51:13Have a great summer. Thank you. You do the same. Great to connect as always. Always. We'll talk soon. All right. That's it. Another one for the books. I'm fired up. I don't know what else to say. I hope you found something valuable in that conversation. I hope you learned something. I hope there's something that you can apply to your business today, tomorrow, in the future that makes you money, makes you more successful, gives you more time with your kids. If there was something, I'd love to hear about it in the comments below. Give me some feedback. And if you like actionable advice and you want more of this, I write a weekly newsletter that gives insights, tips, and tricks into the world of entrepreneurship.

51:49Subscribe in my bio. And if I can help you in any way in your entrepreneurial journey, don't hesitate to reach out to me, nick at cofounders.com. Sorry, Kelly, for more emails. And the last thing is, remember, curiosity is a superpower and you can use it to your advantage. As my mom used to say, there's no such thing as a dumb question, only dumb people. We'll see you next time.