238. 3 Core Rules to Build a 7-Figure Business

0:00Ryan Atkinson:Today's guest walked away from six-figure engineering gigs. We're talking mega projects, northern mines, negative 50-degree conditions to renovate houses in Hamilton, Ontario. He bought his first property in 2016. Today, those same houses have doubled or even tripled in value, and he has partnered with Home Depot across 30 stores, shot a pilot for HGTV, and is about to break ground on a 22-unit development. His aim is Safe. He runs New4, and he's going to break down exactly how he built one of the most highly rated contracting businesses in his market, including why he thinks technical skill is the last thing he looks for when hiring.

0:41Ryan Atkinson:I'm Ryan Atkinson, and you're listening to Helpful Podcast, where we interview entrepreneurs to hear their advice on how you can start a business like this. I'm so excited to welcome Safe to the podcast. So Safe, thank you so, so much for being here.

0:52Seif El-Sahly:Thank you, Ryan. What an introduction.

0:54Ryan Atkinson:Yeah, I want to bring the energy. You're drinking an espresso shot, so I figured I had to bring some sort of energy there. But let's talk about you. Give us a high level real quick for the audience. 15 seconds. What exactly do you do?

1:06Seif El-Sahly:Well, I'm an engineer, and I built a construction business, and I mostly focus on residential and commercial projects here in Hamilton, Ontario, which wherever the viewers are, this is all in Canada.

1:16Ryan Atkinson:I love the construction business. Before we move forward and talking more about your background, what do you guys do in revenue? Can you just ignore us to talk about like how big scale of an operation this is?

1:25Seif El-Sahly:We do a few million years. So it's multiple seven figures.

1:28Ryan Atkinson:Well, we're gonna talk about how someone else can grow there. But before we do that, let's talk about your engineering background. Cause you went from engineering to doing residential renovations in Hamilton. Talk to us about the path that got you there to like that moment to decide, hey, I'm gonna need this engineering job for a residential.

1:43Seif El-Sahly:Yeah, I mean, I studied engineering at a university and then I got a job out of school. It was a pretty good job actually. And I learned a lot. The one thing that is, I would say, the downside of engineering is every problem is very defined. So you typically have a box. So all your unknowns are what we call now that I'm in business. They're called known unknowns, right? So it's like, you know that you don't know this. And what I find out in the real world is the highest paid problems and the highest paid problem solvers are people that are solving unknown unknowns. So you're getting into something that you don't quite know, yet you still somehow make it on top.

2:22Seif El-Sahly:So I'd say that was the one downfall on the engineering side is that all the problems were known unknowns.

2:28Ryan Atkinson:So does it excite you to not know the unknowns there then? Or was that the entrepreneurial itch for you? I'm curious about that.

2:36Seif El-Sahly:You know, at the start, it's always uncomfortable, right? Because money is always on the line, whether you're taking up your time, your energy, your effort, the quality of your product, service, whatever it is. there's always money on the line and no one likes to lose money. So when you're first starting off, you never quite understand what it feels like to lose money because when you grow up and you go to school, right, for the first 20-ish years of your life, you're always taught the A plus student is better than the A, the A is better than the A minus, so on and so forth. And what's the difference between each one?

3:07Seif El-Sahly:Each one makes less and less mistakes, but that's not true in the real world. In the real world, the ones that do very well are the ones that fail, but they fail fast. right? And you learn from it quickly. And then you don't repeat that same mistake again.

3:21Ryan Atkinson:I like it. That is a really good fail fast. That's a good takeaway for the audience there. All right. Let's talk about failing because it is part of every entrepreneurial story. And I want to talk about the really early root of yours. You bought your first property in 2016. What did you see? What like others didn't see and how this light bulb come up for you to be like, hey, let me try my hand at this.

3:41Seif El-Sahly:You know, I had a friend at the time that was involved a little bit in real estate and your first deal is never your craziest deal. Believe me, if everybody is looking at any one deal or a new venture, the one common downfall that I see everybody make is analysis paralysis on day one. You sit and you analyze everything. How do I know this window isn't leaking? How do I know this pipe isn't going to burst? So on and so forth. Take the top three things that you're looking for in a property and that is it. There is such a thing in business as too much information. And the problem when you have too much information, especially I can't even imagine in a world like 2026 with AI, is you're bombarded with way too much detail, right?

4:22Seif El-Sahly:Sort of like you're driving a car and you have a million different lights going on, like the tire pressure and what percentage of your brakes are left. You don't necessarily need all that stuff screaming at you because what's going to happen is you're just going to get distracted. All you need is a clear windshield, gas in the tank, maybe a speedometer, depending how good of a driver you are. So pick a couple of things that you know are absolutely crucial and make the first decision because the indecision is much more painful than making the wrong decision. My first investment wasn't the best.

4:56Seif El-Sahly:Honestly, it wasn't that special. I saved up a bit of money and it could buy me a certain house. I just got the house. I ended up getting it for a half decent deal. The rent covered the mortgage. And I was okay. I self-managed. And then over time, as you start to accumulate a bit more money, you can start to be more specific for what you're looking for. And then you can demand to make much more money.

5:16Ryan Atkinson:That's good. The first three things of like what you know now, what should someone that's getting into this business like know or like look for? If like you had to categorize the best three things to look for.

5:27Seif El-Sahly:So I'll say, okay, so the one thing that I think is a little cliche and I never really understood it, but now I do, right, is location. So when they say location, because when you first start, like the location is so important because once you buy in a terrible area, you simply can't do anything about it. The house price is not going to go up. But the problem with location is it's not that measurable. So when I first started, I would go look at the median house income. I would go look up all these things that are data. I had these crazy Excel sheets and I would measure everything up. You cannot measure that.

5:56Seif El-Sahly:I'm telling you, you can't measure that. So then what I started doing is I just started walking the area. I'd walk up and down the streets of the neighborhood. and then you know what, when you go on a nice sunny summer day and you see a neighbor hosing down their porch, you just say hi and you talk to them. It is a feeling. The question is, would you mind living in this area? And if you don't mind living in this area, you can give it a big check for the location. But you see, that almost sounds too simple. Most people are going to say, well, no, let me run it through this AI model. I need these calculations.

6:28Seif El-Sahly:No, if the location is not good, don't buy it. So I would say that's number one. Two is that the house has good bones. And what that means is it's not too chopped up. When you walk in, you don't see like different sections done renovations in different times. And there's like, you know, you can just tell that layers are slapped on on top of each other. And number three, that it will attract quality tenants. So when you walk into the place, does it feel like it's got potential to be a half decent place to live for a tenant to want to live long term. If you nail those three fundamentals, after that, everything you can get into the analytics, right?

7:01Seif El-Sahly:How much profit are you making? How much income? How much rent is it bringing in minus your expenses? So I would only get into that after those top three are met.

7:10Ryan Atkinson:Yeah, those are great three. I feel like the location ones, that's phenomenal advice. Because like one time when I was touring apartments, I got advice from someone's like, just go there and like, look at the people that are like living there and hate this like stereotype like that. But it's truly like, do you like the vibe of this place? Can you imagine yourself living there. Something that I'm reading between the lines before you answer that question is like, you take action. That I think is very true. You're someone that like takes action. You don't wait for the opportunity. You just like go for it.

7:37Ryan Atkinson:Tell us like the importance of that as an entrepreneur before we continue the conversation.

7:42Seif El-Sahly:Yeah. So I think I'm pretty lucky because when I say I have it in me, if I don't take action, it's sort of like an itch. I'll think about it. I'll obsess over it. I'll think about it five, 10 times a day. And the what if it would have worked out absolutely kills me. I would much rather try, fail, lose a little bit of money, lose a little bit of time. But then I knew I gave it my all because it's impossible. If you've got a good head on your shoulders, right? If you are constantly reading, constantly surrounding yourself with good people, it's a numbers game. Just go make a thousand decisions. You're going to hit home runs.

8:17Seif El-Sahly:You know what I mean? Just make those decisions. And that's the only way I would say to do those is just to make sure that you're actually getting something done and not just thinking about it and waiting to make that perfect decision.

8:27Ryan Atkinson:I talk about it all the time on the podcast, like the biggest difference between like an entrepreneur and like a wannabepreneur is like the entrepreneur like took action on their goals, on their dreams, what they wanted to accomplish. That like to me is like the biggest thing that it typically comes down to is like they took that first step, which can be a scary step, but the entrepreneur like took that step similar to like the path that you've taken, it sounds like.

8:47Seif El-Sahly:Oh yeah, absolutely. You don't have to be the smartest in order to do the best.

8:52Ryan Atkinson:All right, so 2016, you buy your first property. How did you scale up from there? Tell us about that timeframe in your life.

8:59Seif El-Sahly:There was a bit of patience. And I think that's also one thing that a lot of people today are also missing. You have to know when to be impatient and when to immediately react to something and not leave any money on the table. And you have to know when to pull back, right? You need to be very aggressive and very impatient when something is in your control. So if it's a matter of getting a deal, calling a person, making 10 phone calls, driving up to the property, making multiple offers, you got to be impatient. But once you got it, sometimes you just got to sit back and let the asset do the work.

9:30Seif El-Sahly:So I did that in 2016. I bought a couple of houses. I waited. The housing market shot up. I did a little bit of work to it. Right. I didn't go too crazy. I just did a bit to improve it so that the quality of the tenant improved, the rent improved. And that's slowly compounded over time. You don't realize, just put it in an Excel sheet, right? Put a 25-year or a 30-year amortization schedule. Put your rent in the next column. Increase the rent by 2%, right? And every year, it's 2 % from the year before, which includes 2 % on the 2%, right? It's called compounding. And then subtract one from the other.

10:04Seif El-Sahly:And you'll start to see it's like a hockey stick. And just be patient at the beginning. People sometimes don't see the results at the beginning. They're like, oh, it's not worth it. If you were to wait it for just that same amount of time, you would have made 10x more.

10:14Ryan Atkinson:Are you working a nine to five, but dream of entrepreneurial freedom? Look no further than the UFLIP Academy, the number one entrepreneurial platform with 20 plus step-by-step courses taught by active business owners, live workshops, hands-on skill training, a business idea database, and a thriving entrepreneur community to keep you accountable. Click the link in the description below to join the UFLIP Academy today and make this the year you stopped dreaming and started building your business without guesswork. There's a really famous quote out there by Naval where it's like impatient with action, but like patient with results.

10:52Ryan Atkinson:It's one of like my favorite quotes out there. So how long did it take you? And I want to paint the picture for the audience. Like how long did it take you to see that compound and growth? If you're doing 2%, I mean, this was 2016 or 10 years later. Was there a moment where you, it's like, oh, like I, this was like the right call. It's now compounded. Or like, when should people like be able to see those compound results.

11:12Seif El-Sahly:Okay. So it's really slow. If you're going specifically after long-term rentals, okay, you better have another active source of income because it is not going to pay the bills at the beginning, not even close. Okay. So I'm assuming that you're able to have your day-to-day expenses covered by another active source of income. You will start to feel much more free in like seven to eight years. For me, that was only about three years ago.

11:34Ryan Atkinson:Wow. So what does free like mean? Just like help paint that for the audience. What does free mean to you?

11:41Seif El-Sahly:When you take your rent and you deduct your expenses, sometimes you are one tenant moving out away from putting money out of pocket into the property. You are one leak away, one maintenance call away from you putting money into the property. Seven or 80 years later, you're not really going to feel it. I have one or two tenants that don't pay or they pay late. It doesn't affect. You see what I mean? Because now the difference got a little bit bigger. So that is just, it's one less thing off the top of your mind. First of the month, I don't necessarily check the rent roll, who paid and who didn't pay because the mortgage is coming out on the first and the rent's got to come in on the first.

12:15Seif El-Sahly:I don't really check. So if it's a couple of weeks off, it's not the end of the world. Someone else can check that. So you just start to feel a little bit more hands off and that gives you your life back and your relaxation back.

12:24Ryan Atkinson:Yeah, I feel like that's the dream once you can get to that spot of like not having to worry about a tenant leaving, but like you can really live life more freely and having that peace of mind. I feel like a lot of it comes down to like peace of mind as well.

12:37Seif El-Sahly:To be clear, I do not have peace of mind in my life. But I'm just talking about just this one component from the rentals. That is something after like eight years, it's seven, eight years, it starts to get better, right? It's just, you know, when you've been in the same business for now, the better part of a decade, you start to get a lot of different opportunities that come up and you start getting pulled up in every direction. So if you're an ambitious person, your appetite is bigger than your stomach. So start to eat a lot more, right? And you start to get spread thin. That's good.