IAM1842 – Real Estate Investor and Podcast Host Helps Entrepreneurs Grow Their Wealth Passively

Why it was selected for “CBNation Architects”:

This episode on I AM CEO Podcasts features Paul Moore, a real estate investor and podcast host of Wellings Capital. Paul has an extensive background in both engineering and business, having earned an engineering degree and an MBA from Ohio State. After a successful career in the corporate world, he ventured into entrepreneurship and started a staffing company with a partner, which they eventually sold for $2.9 million.

Paul later transitioned into the real estate sector and has since completed 85 real estate investments and exits. He has appeared on HGTV, rehabbed and managed numerous rental properties, and developed a waterfront subdivision. Paul also started two successful online real estate marketing firms. His experience led him to the commercial investment arena, where he manages two private equity funds.

During the episode, Paul shares his CEO hack of focusing on one thing and doing it really well. He advises entrepreneurs to consider pursuing commercial real estate as it has the potential for longer-term investments and growth. Paul defines being a CEO as ruling like a servant and serving like a king, emphasizing the importance of leadership and service.

Transcription:

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Paul Moore 00:00

Almost all the Forbes 400 wealthiest people in America are investing in commercial real estate. A lot of them got there through commercial real estate in the first place. I realized there's a reason for that.

And when I discovered how commercial real estate really works, how the value formula works, et cetera, I've never looked back since then. That's why we launched Welling's capital.

Intro 00:23

Do you want to learn effective ways to build relationships, generate sales, and grow your business from successful entrepreneurs, startups, and CEOs without listening to a long, long, long interview?

If so, you've come to the right place. Gresham Harkless values your time and is ready to share with you precisely the information you're in search of.

This is the I AM CEO podcast.

Gresham Harkless 00:50

Hello. Hello. Hello. This is Gresh from the I AM CEO podcast and I appreciate you listening to this episode. If you've been listening this year, you know that we've hit 1600 episodes at the beginning of this year. We're doing something a little bit different where we're repurposing our favorite episodes around certain categories, topics, or as I like to call them, business pillars that we think are going to be extremely impactful for CEOs, entrepreneurs, and business owners, just like you, what I like to call the CB nation architects who are looking to level up their organizations.

This month, we are focusing on CEO Hacks and CEO Nuggets. This is by far one of my favorite questions I asked on the show. In other words, I asked, what are the apps, books, and habits that makes you more effective and efficient. Those were the CEO hacks. Then I asked for a word of wisdom or a piece of advice or something that you might tell your younger business if you were to hop into a time machine. Those were the CEO nuggets. That's what we'll focus on this month and some of the top ones that can instantly impact your business.

I love all the questions, but with every episode, I thought I would walk away with something I could look at and implement right there to save the precious resources, time and money. Or I would also learn about the advice, tips and tidbits or tools of the trade on how to level up our organization. So you'll hear some of these this month. Sit back and enjoy this special episode of the I AM CEO podcast.

Hello, hello, hello. This is Gresh from the I AM CEO podcast, and I have a very special guest on the show today. I have Paul Moore of Welling's capital. Paul, it's awesome to have you on the show.

Paul Moore 02:24

Hey, it's great to be here. Thanks Gresham.

Gresham Harkless 02:26

No problem. Super excited to have you on. What I wanted to do is just read a little bit more about Paul so you can hear about all the awesome things that he's doing. After graduating with an engineering degree and then an MBA from Ohio State, Paul started on the management development track at Ford Motor Company in Detroit.

After five years, he departed to start a staffing company with a partner. They sold it to a publicly traded firm for 2.9 million dollars, five years later. Along the way, Paul was the finalist for Ernest and Young's Michigan Entrepreneur of the year, two straight years.

Paul later entered the real estate sector where he completed 85 real estate investments and exits, appeared on HGTV special rehab and managed dozens of rental properties, developed a waterfront subdivision and started two successful online real estate marketing firms, three successful developments, including assisting with development of Hyatt Hotel and a multifamily housing project led him into the commercial investment arena where he manages two Private equity firms.

Paul, are you ready to speak to the I AM CEO community?

Paul Moore 03:31

I am ready. I'm exhausted though. After that long bio man, shiny objects in there. Doesn't it sound like?

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Gresham Harkless 03:37

Exactly. I can't imagine how it was doing it. It was a lot of reading. So I know you're rocking and rolling, doing a lot of awesome things. So it's great to have you on the show.

Paul Moore 03:45

You bet.

Gresham Harkless 03:46

Yes. I wanted to kick everything off it and hear more about what I call your CEO story. What led you to start your business?

Paul Moore 03:53

So, when I worked at Ford Motor Company it was almost 20, 30 years ago man, I could have retired. I really liked Ford, and like a lot of people have these complaints about the big company that worked for whatever, but I actually had no complaints. I really liked it. But I looked at the potential career path and I saw that a lot of executives were transferring all around the country, their kids never got to have roots anywhere. I heard of some kids who said that they told their parents back around 10th or 11th grade, look, I'm not moving again, dad. I'm staying here. I'm going to move in with my friend. I didn't want to see that happen.

So, I also found myself tinkering with stuff. My buddy and I were always doing things in the evenings and weekends trying to start some side gig, to make money on the side. So I realized, I think I'm more set to be an entrepreneur than I am work at forward for the next 30 or 40 years. So we launched out on our own. My wife was amazing because she is super risk-averse. She hates risk. But she actually let me take this risk, even though she was 7 months pregnant with our 1st child.

We didn't even know any entrepreneurs, so she hated the thought of all that risk. But, thank God for her that she let me launch out and gave me the freedom to do that. And so, there's been a lot of ups and downs along the way let me tell you.

Gresham Harkless 05:16

Yeah, I bet so. Could you tell us a little bit more on what you decided to launch? Tell us a little bit more about Wellings Capital and everything you're doing.

Paul Moore 05:23

Yeah. So after doing that company, in 1997 before my 34th birthday, I actually found myself going into so called semi retirement and I thought I'm an investor now. I really didn't know the first thing about investing, Gresh. I thought I didn't understand the difference between investing and speculating. Investing is when your principal is generally safe and you've got a chance to make a return. But speculating is when your principal is not at all safe and you've got a chance to make a return.

I was definitely speculating and calling it investing. So I made a lot of money on some things and I lost a lot of money on other things. That's one of the reasons we launched the podcast we have today, it's called How to Lose Money. That's where we talk to successful entrepreneurs and investors about mistakes and things in their past on their road to success, where they got burned or lost a lot of money. But at any rate, I got into flipping houses before flipping was a thing. Then we actually started buying and reselling waterfront lots, built a small subdivision, built some houses from the ground up.

Like I said, I made some money, lost some money and I realized when I turned 50, that I didn't want to be on the losing end of some startup, or some risky speculative venture. It's the double or nothing. I didn't want to be on the nothing part of that someday in my 50s, 60s, 70s, whenever I couldn't work again, I didn't want to leave my family stranded. And I thought, what could I do? What could I do that would be risk averse, that I wouldn't be swinging for the fences?

I'd actually be trying to hit singles and doubles and I discovered that in commercial real estate. Gresh, I found out that almost all the Forbes 400 wealthiest people in America are investing in commercial real estate. A lot of them got there through commercial real estate in the first place. I realized there's a reason for that. And when I discovered how commercial real estate really works, how the value formula works, et cetera, I've never looked back since then. That's why we launched Wellings Capital.

Gresham Harkless 07:38

Nice. I absolutely love that. I always say success leaves clues, so the fact that you mentioned that the people in the Forbes 400 or Forbes 500 were, are somehow associated with commercial real estate.

You understood that, that was something that not only did it fit within what you were trying to accomplish, but it also could lead you on that path and could lead many others on that path. It sounds like.

Paul Moore 07:59

Yeah, that's very true. It's surprising to me that and I can go through the math if we have more time, but if you can save a dollar a month at a commercial real estate property, if you can make an extra dollar or save a dollar, you add a dollar to your income. That's twelve a year and you divide that amount by the cap rate, which is the rate of return. Let's say that's 6%. That's the general rate of return in a certain asset, certain property, like a certain market right now. $12 divided by 0.06 is 200.

So I can create $200 in value at an asset, whether it's multifamily, self-storage, or mobile home parts. I can create $200 in value to the shareholders by adding a dollar to the bottom line. It's pretty powerful. Now, you take that and multiply that out times the thousands of dollars you can actually create. We're talking real money here and with leverage, when you take debt into the equation, it even multiplies that effect further. There are all kinds of examples in this if we have more time, but it is a powerful, powerful lever that commercial, investors, and operators can pull to really create real big wealth.

Gresham Harkless 09:15

Nice. Yeah. Now I wanted to ask you for what I call your secret sauce. This could be for you or your organization, but what do you feel sets you apart and makes you unique?

Paul Moore 09:25

So what we're doing is there are a lot of people, there are some newbies out there who were not investing in real estate in the last crash, and they're now experts. They've got mentoring programs, they're selling coaching, and they haven't lived through a crash, and I will say that we've been through a couple of crashes, the minor one in early, like around 2001, and then the big one, of course, that we all know about.

I can say that we have gone to great lengths, we're in our fifties, we're vet operators and we are able to find great operators and put them together and make their products, their investments available to investors. And so Wellings Capital has got two funds. We've got a growth fund, which is all about appreciation and then an income fund, which is income and growth.

We've put together a diversified group of these amazing operators who have survived and actually thrived through more than one recession and who have great returns. Some of them are not really well known to the public. We're making them known to our investors and giving investors an opportunity to invest and they're actually giving us a better deal because of our size.

So we're actually able to do that at no effective cost to the investor. So that's what we love about what we're doing.

Gresham Harkless 10:52

Yeah, absolutely. And I always say that, you always try to build upon the expertise of the people that are on your team or the people that are around you. Like you said, you guys have been through those great economic times, but also the not-so-great economic times.

To be able to tap into that expertise and understand how you're investing your money, how you're not speculating unless you want to speculate, but understand the difference between the two is really important to do that. If you're doing something like that.

Paul Moore 11:16

Thank you.

Gresham Harkless 11:16

That makes perfect sense. I wanted to switch gears a little bit and ask you for what I call a CEO hack. This might be an app, a book or a habit that you have, but it's something that makes you more effective and efficient.

Paul Moore 11:28

Yeah, absolutely. So, I'll tell you CEOs and entrepreneurs in general are a very, let's say, an optimistic bunch. So as optimists, we tend to believe, we tend to also get distracted easily. We tend to chase shiny objects and he who chases two rabbits catches none, usually catches none.

There's another saying, I'm forgetting it already, but an acorn that is planning to turn into a large oak tree plans not to move around too much. I said that totally wrong, didn't I? But anyway, you get the point.

Gresham Harkless 12:04

I got the point.

Paul Moore 12:06

So I found that over the years, one of the biggest mistakes I made is just chasing too many things at once. So I have begun a program with Jeff Woods and Gary Keller. It's called the 1 thing. A lot of us have heard of the One Thing book, but they've actually got a program you can sign up for it. They teach you and they have weekly updates and coaching calls and accountability, helping you stay accountable to focusing on one thing and doing that really well.

Gresham Harkless 12:37

Yeah, that's good. That's a great hack because a lot of times I always visualize and I can't remember the quote myself, but it always talks about a magnifying glass. If you take a magnifying glass and you put it under the sun, it will burn a hole in a wooden plank. But if you take that same sun and you don't have the magnifying glass, it can lay on that plank the entire time and never make any impact.

So it's so important to be like, focused and have that one thing. So I'm glad you you brought that up.

Paul Moore 13:02

Very true. That's good.

Gresham Harkless 13:04

Yes. Now I wanted to ask you for what I call a CEO nugget. You might have already touched on this, but this is a word of wisdom or a piece of advice, or if you can hop into a time machine, what would you tell your younger business self?

Paul Moore 13:16

Oh, absolutely that's easy. I've told my son and my junior partner, they're both about 25 years old and I said, knowing what I know now about commercial real estate, but it absolutely never would have done anything else because the risk and the return and the ability to see the demographic outlook for years to come is very, very powerful.

Warren Buffett doesn't generally invest in internet stocks because he says, I don't know what the future technology holds, but I do know that the Internet's not going to change the way people chew gum.

Gresham Harkless 13:51

Yes, that makes perfect sense. And, who better to listen to than definitely the guru Warren Buffett, especially. I know him talking about that.

Now I wanted to ask you my absolute favorite question, which is the definition of what it means to be a CEO. We're hoping to have different quote and quote CEOs on the show. So, Paul, what does being a CEO mean to you?

Paul Moore 14:07

You know, I think it means being a servant and drawing out the talents of everybody in your organization. A CEO, they say we should rule like a servant and we should serve like a king.

And so as a CEO, I want to do both of those. I want to rule like a servant and I want to serve like a king.

Gresham Harkless 14:29

Nice. I absolutely love that. Paul, I truly appreciate your time. What I wanted to do is pass you the mic, so to speak, just to see if there's anything additional you can let our readers and listeners know. And then how, of course, how best they can get ahold of you and listen to your podcast.

Paul Moore 14:41

You know, I touched on it earlier. I said that investing versus speculating is something that's really important for everybody. I'll leave people with a couple of quotes here. So Paul Samuelson was the first Nobel prize winner in economics from the U.S. Samuelson said that investing should be like watching paint dry or watching grass grow.

If you want excitement, take 800 and go to Las Vegas. I think Samuelson's quote is so important because it reminds us that, while we might want to get all kinds of fun, we might want to live on the edge. We want to have excitement as a CEO. That's fine as an entrepreneur, but when it comes to investing, our investment should generally be very boring.

Then the very last quote is from the wisest man who ever lived. His name is King Solomon. And he said, he who invests, he who gains wealth quickly. We'll watch it dwindle and I think that's a similar thing. We need to be in it for the long haul.

Gresham Harkless 15:45

Nice. I definitely appreciate those nuggets and people that want to reach out to you. What's the best way for them to do that?

Paul Moore 15:50

They can go to our website. It's wellingscapital.com.

Gresham Harkless 15:53

Awesome. Awesome, awesome. We'll have those links in the show notes as well. But thank you so much again, Paul. I appreciate you. I hope you have a phenomenal rest of the day.

Paul Moore 16:00

Thanks Gresham. Appreciate it.

Outro 16:02

Thank you for listening to the I AM CEO podcast powered by Blue 16 Media. Tune in next time and visit us at iamceo.co. I AM CEO is not just a phrase, it's a community.

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Grab CEO gear at www.ceogear.co. This has been the I AM CEO podcast with Gresham Harkless. Thank you for listening.

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