Mark Lemmons, Co-Founder of FLW Capital, joins us to discuss his real estate investing journey. He has gone from single family, to passive investing in apartment syndications and has now moved on to buying large multifamily real estate as an operator.
We cover partnerships, building the right team, investment philosophy, and much more.
Connect with Mark at https://flwcapital.com/.
To join the DJE Investor list visit https://djetexas.com/access
For multifamily mentoring visit https://www.apartmenteducators.com
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Transcript
Devin Elder :
Mark, welcome. How are you?
Mark Lemmons:
I’m doing fabulous. Thanks for having me out today.
Devin Elder :
Yeah. Thanks for coming here in studio. Always better than a Zoom call.
Mark Lemmons:
Absolutely.
Devin Elder :
So, that’s good stuff. You guys are in San Antonio, so that doesn’t hurt.
Mark Lemmons:
Right, right down the road.
Devin Elder :
Yeah. Yeah. So, let’s jump in. I love you guys’ story. You’ve got a real state background, but more recently, getting into these huge deals, which we’ll dive into. Let’s dial it back for people that haven’t met you guys or FLW Capital. What’s your story? What’s your background?
Mark Lemmons:
Well, me personally, going way back to the way back there, have a history and a past in ministry. And so, just a heart for serving people, loving on people. Life transition, moved into real estate. Turned out to be a good move financially and professionally. Enjoyed that, and kind of applied some of the same principles there, just putting people first, treating them the way that I’d want to be treated if our roles were reversed. And that worked well in the residential real estate business.
Devin Elder :
Gotcha.
Mark Lemmons:
Began to also, on the side, kind of build a little bit of a portfolio for myself.
Devin Elder :
Right.
Mark Lemmons:
Investment properties. Got into the single families, did a few flips here and there. Brokered a few deals kind of as a wholesaler once, just once.
Devin Elder :
Sure. Once is enough.
Mark Lemmons:
Right? And then, I started to look, okay, well, how can I leverage myself a little better? How can I take the knowledge that I have, the experience that I have and put those to work for me to do something a little bit bigger that requires maybe less hands on, but still has some great returns? And so, that kind of led me on a path and a journey to kind of figure out, okay, what’s next? And that led me to multifamily. In forming FLW Capital, knew my buddy, James, from kind of the investment world. We’d get together and kind of talk ideas and chat on this single family investment front.
Devin Elder :
Right. Yeah, you guys trade notes on all that stuff, right?
Mark Lemmons:
Absolutely. We get together regularly, grab lunch with a couple other guys and just talk shop. Right?
Devin Elder :
Sure.
Mark Lemmons:
But my buddy, Dave, who we kind of joined together to form our company, we, he and I have been buddies for years. Every Friday, we have breakfast. I mean, almost without fail. Unless we’re on vacation or something, we’re having breakfast on Friday. And so, he’s just one of those good friends that’s really sharp. But he was always in the real estate realm. He was okay doing some land deals and things here and there, but he did not want to mess with investment properties, because he didn’t want to be a landlord.
Devin Elder :
Smart man.
Mark Lemmons:
He is a smart man. And so, when I went to him, and I was like, “Hey buddy, look at this. This is what I’m thinking about doing. I’d love for you to join with me in this.” When he saw it, he immediately, boom. He was like, “All right, I’m in, let’s go.”
Devin Elder :
Right. So, he’s a numbers guy? So, once you-
Mark Lemmons:
Totally a numbers guy.
Devin Elder :
Yeah.
Mark Lemmons:
And I’m more the relationships and kind of see the big picture, and he’s in the numbers. I mean, he’s really good with people too, because he’s a really good capital raiser, but-
Devin Elder :
Right. Yeah, no kidding.
Mark Lemmons:
Right? But he was a good just partner in that. And James had a lot of experience in kind of the syndication world and together we kind of came together and formed FLW Capital.
Devin Elder :
I love it. I love it. So, going back to kind of the real estate broker piece, I was always fascinated by realtors having a lot of knowledge and basically being adjacent to investments, but most of them never get into the investment side. Right?
Mark Lemmons:
Yeah. It’s astounding to me.
Devin Elder :
Right, yeah. I agree.
Mark Lemmons:
The number of people that actually invest in real estate, they don’t practice what they preach.
Devin Elder :
Right.
Mark Lemmons:
They’re like, “Yeah. It’s a great idea. You should do this.”
Devin Elder :
Sure.
Mark Lemmons:
“So I can make my commission.”
Devin Elder :
Sure.
Mark Lemmons:
And they’re not doing it themselves. And if they are, they do it on such a small scale that they don’t, I don’t know if they don’t have the vision, or they just nobody’s taught them. They don’t take it to the next level and then to the next level. And I’m like a preacher on a crusade or something.
Devin Elder :
Sure.
Mark Lemmons:
I mean, this is, it can be life changing.
Devin Elder :
Yep.
Mark Lemmons:
When you jump in, and do it right.
Devin Elder :
Yep. Yeah. It’s a completely different thing. So, you have gone through this process that a lot of us have gone through of learning about it, exploring it, getting a network together, then trying it passively, right?
Mark Lemmons:
Yeah.
Devin Elder :
Was that your first exposure to multifamily? I want to say multifamily. These are $10 million buildings plus, 100 units plus, definitely a different animal than a single-family rental or a wholesale deal. What was your first experience period in multifamily as an actual investor, not just a bystander looking at deals?
Mark Lemmons:
Right. Well, I don’t know if you know this or not, but my first passive investment deal was with you.
Devin Elder :
Nice. I suspected, and I’m not trying to plug our firm, but I thought that might be the case. Okay.
Mark Lemmons:
So, and really-
Devin Elder :
Which one? Via or Allure? No.
Mark Lemmons:
Yeah. Allure.
Devin Elder :
That deal is going to…
Mark Lemmons:
It’s a rock.
Devin Elder :
Kill it. Oh my gosh. We’re refinancing it right now.
Mark Lemmons:
I love that thing, by the way.
Devin Elder :
But when we… And the re-fi is, I don’t want to say, it hasn’t been a headache, but I’m like, “God, we could have just sold this thing and…”
Mark Lemmons:
Cashed out.
Devin Elder :
Cashed out, but gosh, when we cash out in two years, it’s going to be even better, so great deal.
Mark Lemmons:
Absolutely.
Devin Elder :
Glad to have you on it. Yeah.
Mark Lemmons:
What’s interesting, though, is I passed on the [Mila 00:05:33].
Devin Elder :
Okay.
Mark Lemmons:
That I believe you-
Devin Elder :
Selling right now.
Mark Lemmons:
[crosstalk 00:05:37] contract on?
Devin Elder :
Yeah. Selling in two weeks.
Mark Lemmons:
So, my due diligence on that was looked through all of your underwriting-
Devin Elder :
Perfect, yeah.
Mark Lemmons:
[crosstalk 00:05:43] offering memorandum, kind of dove in. And I drove the property because I’m like, “Hey, I’m not going to invest in something that I can’t see, feel and kind of have a good understanding of, and so drove it. Didn’t know that area of town that well.
Devin Elder :
Right.
Mark Lemmons:
And so, I was like, “I’m going to pass. I’m just going to wait and see what else is there.”
Devin Elder :
Yep.
Mark Lemmons:
And so the next one came along, and I had a little more confidence, had a little more understanding, because I watched that one go, and then just kind of the more at-bats you get, the better you get.
Devin Elder :
100%, yeah.
Mark Lemmons:
And so [crosstalk 00:06:15]
Devin Elder :
Just start seeing patterns.
Mark Lemmons:
Exactly.
Devin Elder :
Yeah, more [reps 00:06:17].
Mark Lemmons:
Saw the patterns, and it was like, the next one came along, the Allure came along, and I was like “Okay. I see it. And I’m in.”
Devin Elder :
Yeah.
Mark Lemmons:
And so jumped in, and did that, of course, several times with you. And over the course of several years, began to invest in other properties as well, with other syndicators. Then at one point, the light kind of clicked on, “I can do this.”
Devin Elder :
Right. Yeah. It’s funny how that works. You start seeing enough of it.
Mark Lemmons:
Yes.
Devin Elder :
And then, you’re in the game. You’ve got money in this thing.
Mark Lemmons:
Absolutely.
Devin Elder :
It’s funny how much you’re paying attention on a deal you actually wrote the check on, right?
Mark Lemmons:
[crosstalk 00:06:51] Right. Yeah. Follow your checkbook, and you know where your heart is, right?
Devin Elder :
Yeah. That’s great. Yeah.
Mark Lemmons:
And so, you put money behind it and you see, oh wow, this is pretty important. I’ve got to learn this, because if I’m putting my money there, I better know it.
Devin Elder :
Yeah. That’s right. So you were, and it’s a classic deal. I say it all the time. It’s, step one, invest in a deal.
Mark Lemmons:
Exactly.
Devin Elder :
You get on the plane, but you certainly aren’t the pilot, and you don’t have all those responsibilities, but over time, somebody that’s so inclined can move into the pilot seat with some training and some networking and obviously lots of work.
Mark Lemmons:
[crosstalk 00:07:25] pilot’s license.
Devin Elder :
Yeah. That’s right. Yeah. But that’s on the menu, to kind of move up to operator if you want. So, I love that. It’s a great way to learn. Hopefully you’re picking good deals, and you’re getting good on your money, but it’s a great kind of first step too.
Mark Lemmons:
Right.
Devin Elder :
And then, you guys kind of really jumped in. Once you formed FLW, it was months before you closed your first deal? I mean, it was not like a multi-year process. Right? It was-
Mark Lemmons:
It wasn’t. We were, I would say, fairly quick in that. One, I think we all had pretty good networks to begin with.
Devin Elder :
Totally, yeah.
Mark Lemmons:
So, that helps a ton.
Devin Elder :
Yep.
Mark Lemmons:
Then some connections we made along the way, some relationships that we were introduced to in our kind of mentoring process were instrumental as well. But then yeah, we were, goodness, probably you six to nine months, and we were closed and done with our first deal.
Devin Elder :
Right. We were talking about that specific deal earlier today, how when you’re buying a deal, it’s always like, “Oh gosh, are we paying too much?” But then-
Mark Lemmons:
Absolutely.
Devin Elder :
… the market changed so much since you guys bought that. It’s like, you would’ve bought 10 of those. Right?
Mark Lemmons:
Yeah, probably more.
Devin Elder :
I mean, which is a story… We don’t know what the future holds, but it’s great to get into something at a good basis.
Mark Lemmons:
Yes.
Devin Elder :
And the kind of adage of buy real estate and wait.
Mark Lemmons:
It just works, right?
Devin Elder :
Right.
Mark Lemmons:
I mean, I’ve seen it in single-family. It’s like, you just hold this property longer, and the rents go up, and your margin gets better year after year after year. You pay that note down. It’s just basic principles, just multiplied by 100 or more.
Devin Elder :
Right.
Mark Lemmons:
And it’s powerful in single-family, and it’s even more powerful in multi.
Devin Elder :
Yeah. Add some commas in there, right?
Mark Lemmons:
Mm-hmm (affirmative).
Devin Elder :
So that property, what has been your experience? It’s very different being an own owner-operator of 140 units than it is a single-family rental, very different experience. What are some of the things, because you’ve been a passive investor. You understood multifamily, kind of got your mind wrapped around a lot of these pieces and got educated and networked, and then actually getting into doing it is quite a different thing.
Mark Lemmons:
It is very different.
Devin Elder :
What were some things, I guess, some takeaways that you might tell yourself from a couple of years ago, now that you are, you’re here, you’re doing it. You’re the operator. Right?
Mark Lemmons:
Right. Goodness. Takeaways, really dive into the numbers. And really know your business, because it’s easy to just look at a T12 and kind of look, okay, there’s the bottom line. And that’s kind of where I gravitate towards, but I’m finding value in now looking back. I kind of wish I’d done that a little sooner to really know my business.
Devin Elder :
Sure.
Mark Lemmons:
And because there are just some lessons along the way. Things kind of slide by, and time passes, and then it’s like, yeah, let’s look a little closer at that. Because that’s how we can manage better. That’s how we can operate better. And so, it’s just those lessons that you learn along the way, that you get a little better with that experience. And so, we’re getting that experience, and we’re a whole lot better than we were when we first started.
Devin Elder :
Sure.
Mark Lemmons:
But it’s been one of those journeys that those numbers matter. Second thing I would say is really how to manage the manager. And now, your entity, DJE, you’re kind of one guy. Right?
Devin Elder :
Right.
Mark Lemmons:
And yeah, you have some staff members that help you in some aspects, but you’re a one-headed-
Devin Elder :
One decision maker.
Mark Lemmons:
… Exactly. One-man-show in the decision [crosstalk 00:10:57].
Devin Elder :
Huge, big team. Let’s not get that wrong, but when it comes down to the decision on, are we, the big decisions, right. One.
Mark Lemmons:
And we are very different in that, that we are kind of a three-headed monster.
Devin Elder :
Yes.
Mark Lemmons:
And so, we really have to have our lanes fully delineated and very clear.
Devin Elder :
That’s a great point. That’s a great point.
Mark Lemmons:
So, that’s something that we’ve learned in our process. Just, “Hey, is this you? Or is this me?” That needs to be decided way back, not now in the moment, but that needs to be clearly defined. And so, having those lines just very clear along the way is like, whose bucket is this in?
Devin Elder :
Right.
Mark Lemmons:
Really helps us operate better.
Devin Elder :
That’s such a great point. I can’t underscore that enough. And I’ve been in partnerships where there’s overlap, and then people are pointing fingers, or you have somebody that’s doing something that’s maybe not a strength for them.
Mark Lemmons:
Right.
Devin Elder :
That they shouldn’t be, so kudos to you guys for figuring some of that stuff out. Right? I mean, I think you guys’ kind of friendship and history before-
Mark Lemmons:
That helps.
Devin Elder :
… the partnership helps, but those of you guys listening that are getting into partnerships, clearly delineate those things as much as you can upfront. And I like single owners of things.
Mark Lemmons:
Yes.
Devin Elder :
Is who is managing the draw process with the lender? Right? Or fill in the blank. Who’s taking care of the insurance renewal?
Mark Lemmons:
Right.
Devin Elder :
That’s got to be, I like one owner of specific things. And then, that way you can stay out of the other person’s way. And you guys have been able to do, I mean, frankly, I’ve kind of been amazed at what you all have been able to do. And I think part of that is because you’ve got some divisional labor there.
Mark Lemmons:
Yes.
Devin Elder :
Right? It’s not. And I mean, look, you also have families and jobs and things going on, right?
Mark Lemmons:
Absolutely. Yeah. I mean, one of the principles you teach is that this is a team sport.
Devin Elder :
Sure.
Mark Lemmons:
And so, it’s a team sport in the sense that you need a good team around you, and you can do that as one decision-maker, like you’ve done with a staff that supports you, and pull it off, or you can do it like, “Hey, let’s form a partnership and divide some labor up and figure this out.” And that’s kind of the route that we’ve gone.
Devin Elder :
Yep.
Mark Lemmons:
I feel like we’ve been able to go a little faster as a result of that.
Devin Elder :
100% agree with that.
Mark Lemmons:
Because our network is not just relying upon the one decision maker.
Devin Elder :
Right.
Mark Lemmons:
But it’s three networks, and we have some overlap, no question.
Devin Elder :
Right.
Mark Lemmons:
But we really are able to pull from a larger pool as a result.
Devin Elder :
Yeah, that’s right. You guys have been, I mean, the capital raising stuff, I’m like, “Wait, these guys are just killing it, man.” I mean, and you’ve got to establish networks and all that stuff.
Mark Lemmons:
And we just feel like we have some favor from, I mean, from God in that, just, I mean, we’re trying to do what’s right for our investors, first and foremost.
Devin Elder :
Yep.
Mark Lemmons:
And that usually plays well in business, as silly as that sounds or as elementary as it is, just treat people right, and it works out.
Devin Elder :
Oh, 100%. I think one of the things that attracted me to syndication, this model, sometimes in my corporate careers, in the past working for big companies, and this is not a knock on any company I worked for. It’s just the nature of working for a big bureaucratic organization is I felt like we were kind of working against the interests sometimes of a customer or of an employee. I truly feel like in real estate, and I feel kind of like, I wonder if people think I’m naive sometimes, but then I look at this business we’ve built, and I go, “Well, clearly it’s working,” right? But it’s that everybody wins. And if you structure it that way, I mean, there’s been stuff with investors or whatever where we’ve for sure left money on the table. And it’s like, well, yeah, but what if we do 10 of these over the next couple years? It just doesn’t matter. Let’s structure it so that everybody wins. And everybody knows that about us. People want to come work for us. People want to invest with us. And I mean, it works. Right?
Mark Lemmons:
Yeah. Absolutely.
Devin Elder :
It works. And it is, it’s funny, as much as we work on these deals, the investors own most of it.
Mark Lemmons:
Absolutely.
Devin Elder :
Still. I mean, they’re just writing the check, and they own overwhelming majority of the deal. Right?
Mark Lemmons:
Right. Yeah. To your point, in the corporate settings, it’s policy over people.
Devin Elder :
Right.
Mark Lemmons:
But in the syndication world and in real estate, we are able to keep people over policy, and people are really kind of the profits too.
Devin Elder :
Right.
Mark Lemmons:
Profits, obviously, that’s the driving force, but that is, I mean, that’s what the people want. Right?
Devin Elder :
Sure. Right. Yeah. Yeah. I love it. I love it. That’s one of the things I love about this business is being able to structure it like that. So, what’s on the, you guys have done all the stuff. You invested passively. You’ve got educated, got networked, built the team. Very importantly, took over a deal, because it’s easy to do all those things-
Mark Lemmons:
And then just-
Devin Elder :
… and spin your wheels for five years. Right? It’s very different taking action. And frankly, it can be frightening. Right? It’s like, a friend of mine has a huge multifamily portfolio. One of my mentors. He’s like, “You’ve got to jump, man.”
Mark Lemmons:
Yeah.
Devin Elder :
I mean, all this stuff of learning, getting educated, networked, you have to do it, but then, there’s that point where you just have to leap. And so, but you guys did that, went from no multifamily to one multifamily. Now you’re in the club to make stuff easier with lenders, easier with investor conversation, all this stuff.
Mark Lemmons:
Yes.
Devin Elder :
Now, what are you guys working on? And what is on the horizon for you guys next year or so, next couple years?
Mark Lemmons:
Yeah. I mean, we are excited about the future, first and foremost. I mean, we are currently under contract with another deal.
Devin Elder :
Awesome.
Mark Lemmons:
And excited to close that here within the next month or so, give or take, and our investors are all committed, and we filled up very fast. Thrilled about that.
Devin Elder :
Did fill up very fast. Yeah. And just so we’re clear, we’re not pitching a deal here. This deal’s full.
Mark Lemmons:
Not at all. Not at all. It’s full. Sorry.
Devin Elder :
Yeah. That’s right. Which is by the way, the best marketing you can do. Right?
Mark Lemmons:
Absolutely. And so, we’re just looking at the next one. And so, we’re also looking at some strategic partnerships, because there’s just some leverage that can be attained that way as well.
Devin Elder :
Sure.
Mark Lemmons:
But we’re looking to put out three to four deals, really, in the next 12 months.
Devin Elder :
Yep.
Mark Lemmons:
And we feel like we can take those down one at a time.
Devin Elder :
Right.
Mark Lemmons:
We can take them down in the sense that we take them over, close them, stabilize them, get the management company humming along.
Devin Elder :
Yep.
Mark Lemmons:
And then begin to kind of lift our head and look up and say, “Okay, what’s next?”
Devin Elder :
Right.
Mark Lemmons:
And so, that’s really where we want to be, and we don’t want to get overwhelmed or get in over our heads with anything.
Devin Elder :
Sure.
Mark Lemmons:
Whether it’s the management piece, the financing of any of that. We just want to, again, to your teaching and mentorship, take them one at a time.
Devin Elder :
Yeah.
Mark Lemmons:
And get them under control and move on.
Devin Elder :
Yep. And it’s interesting. That’s a disciplined approach. Right?
Mark Lemmons:
Sure.
Devin Elder :
And I think a lot of times what happens with people learning syndication is they realize, holy smokes. I remember, I thought early on that capital’s going to be the hard piece and how am I ever going to raise millions of dollars? And then, I did a few deals, and I was like, “Oh, capital’s not the hard part.”
Mark Lemmons:
Not the hard part, right?
Devin Elder :
In fact, it’s even more onus now on me, because people are looking at me to be the arbiter of whether this is a good deal or not. And a lot of times, they’re just throwing money at it.
Mark Lemmons:
Yes.
Devin Elder :
Because they trust me, which is an even bigger responsibility. Right?
Mark Lemmons:
The weight on your shoulders, I think grows-
Devin Elder :
100%.
Mark Lemmons:
… when you have success. Because then it’s like, okay, well, now you’re trustworthy, so you better continue to have that success.
Devin Elder :
100%.
Mark Lemmons:
I think there are some syndicators out there who, who have had early success and then floundered a little bit, or run into some issues, whether it’s legal or just not producing returns for investors, but we don’t want to be in that group.
Devin Elder :
Yep.
Mark Lemmons:
We don’t ever want to get there.
Devin Elder :
That’s right. And it becomes this thing, I think, just because you can.
Mark Lemmons:
Yes. [crosstalk 00:18:47]
Devin Elder :
Because you could go out and do 10 deals, but it’s like, all these operational pieces, which are kind of the real work.
Mark Lemmons:
Yes.
Devin Elder :
That’s work.
Mark Lemmons:
Yeah.
Devin Elder :
And that doesn’t just scale overnight. It’s funny. You mentioned early success. I bought a deal. I’m not going to name specifics. It was disastrously operated.
Mark Lemmons:
Oh, yeah.
Devin Elder :
And I had heard through the grapevine that the seller had just knocked it out of the park in a oil town at the right time.
Mark Lemmons:
Nice.
Devin Elder :
And just killed it for the investors. I mean, it was this boom-and-bust, and they caught a boom.
Mark Lemmons:
They caught the [crosstalk 00:19:29].
Devin Elder :
Yeah. And then they bought this other deal, it was just clearly they had no business operating this thing. And it was a disaster, which was fine, because it created some opportunity on the buy side, but it’s, the operations is hard work.
Mark Lemmons:
Yeah. It is.
Devin Elder :
You’ve got to structure something to be sustainable. Especially, I mean, for anybody that, any of us are raising capital, but I mean, you guys are working with long-time relationships on capital partners and folks, friends, family network. I mean, that stuff is such a high standard.
Mark Lemmons:
Absolutely. Yeah. And I mean, we hold that stuff dear. These are relationships that we intend to keep for 15, 20 more years or longer.
Devin Elder :
Yep.
Mark Lemmons:
And for the rest of our lives, really.
Devin Elder :
Yep.
Mark Lemmons:
And so, we value those relationships, and we are going to do everything we can to maintain those relationships and even improve them and deepen them through this, through the partnerships that we have with them.
Devin Elder :
Yep.
Mark Lemmons:
In real estate, and I mean, just this week, we were dangled a deal, off market. It was a screaming good deal. And it looked so attractive financially, but we said no.
Devin Elder :
That’s hard.
Mark Lemmons:
It was like, “Gosh, but oh, give me a month on this. Give me two months.”
Devin Elder :
Doesn’t work like that. Yeah. I wish.
Mark Lemmons:
Yeah. It doesn’t work like that. So, we’re like, “Sorry, we are not in on this deal.”
Devin Elder :
Yep.
Mark Lemmons:
And so, that’s hard too. You have to learn to say no.
Devin Elder :
Right.
Mark Lemmons:
And so, we did that just this week.
Devin Elder :
Yeah. It is hard, because you might go through a six-month dry spell after that. Right?
Mark Lemmons:
Exactly. Right? We don’t know what the future holds.
Devin Elder :
Right. Yeah. That’s tough. It’s also the flip side of that coin. It can be a little liberating. I know we’re getting ready to hopefully go under contract on a very large project, which would take us out of the game for a few months, and that’s just kind of the size of the firm, right? We’re not trying to do a million deals. And that, to me, I’m like, “I hope we’re awarded this project,” because then I know we’ve got our work cut out for us. I’m not even going to look at underwriting, which you can kind of go, you kind of get blurred vision after looking enough of these 200-line item PNLs.
Mark Lemmons:
For sure.
Devin Elder :
You’re just like… It’s good to get a break from some of that stuff sometimes, so it is kind of nice to just be in a deal. Let’s raise it, raise the money, close it, see it through. Like you said, do your takeover, then kind of come up for air. So it does, I guess, for a firm that’s not trying to be in 12 markets or whatever the case is, you can really kind of go through those cycles and kind of surf through it.
Mark Lemmons:
Great point. Yeah. And so, we’re in that, we’re in the phase right now where we’re not really looking at deals even though brokers are sure trying to get us to look at them, and we want to maintain those relationships for sure, but at the same time, we don’t want to get ahead of ourselves.
Devin Elder :
Yeah. And you mentioned point about brokers showing you deals. It’s like, boy, once you close that first one, I mean, anybody can talk about anything they want. People can listen to this podcast and learn all the jargon.
Mark Lemmons:
Exactly. Right?
Devin Elder :
Right? Or any podcast. You read the book, but man, nothing succeeds like success, right? Close a deal. And now, they’re calling you, right?
Mark Lemmons:
Exactly. Yep.
Devin Elder :
Yeah.
Mark Lemmons:
Yeah. My inbox is a whole lot more full now that we’ve got some deals under our belt than it was before. It was like, wow, will this email ever be full? And yeah, it’s way more full now.
Devin Elder :
Yeah. So I mean, that’s the key to getting more deals is close a deal. Right? Which is the hard part, but once that at domino falls, it changes. Yeah.
Mark Lemmons:
Yeah. You get a little momentum there.
Devin Elder :
Yep.
Mark Lemmons:
And you’re just kind of, you’re on the other side of the table. Brokers look at you a little different, “Okay, they can do this.”
Devin Elder :
Yep.
Mark Lemmons:
And so…
Devin Elder :
I remember that was such a huge turning point for me. I had partnered on a deal with some people. They’d gotten me into a larger deal. And then, the next deal I bought was basically as the sponsor with some investors.
Mark Lemmons:
Right.
Devin Elder :
And boy, once I closed that deal, it was, I would call brokers kind of hesitantly, see if they wanted to go to lunch. And they were like, “Oh, yeah.” And it was like this whole different thing. Right? It was like, everybody’s treating,, people treating you different and this is a while ago now. But I remember that was a very distinct turning point.
Mark Lemmons:
Yeah. It’s like, “Devin who? Oh, Devin Elder.” [crosstalk 00:23:40]
Devin Elder :
Right. Yeah, you get into a pretty small club, which is interesting and totally unfair. Right? I mean, this is…
Mark Lemmons:
Right.
Devin Elder :
But from a broker’s perspective, come on. You want closers.
Mark Lemmons:
Yeah. You don’t have the time to deal with people that are just going to waste your time.
Devin Elder :
Right.
Mark Lemmons:
You deal with people that can close.
Devin Elder :
Right.
Mark Lemmons:
And so, cookies are for closers, right?
Devin Elder :
Cookies?
Mark Lemmons:
Coffee for closers?
Devin Elder :
Yeah. Cookies are for closers?
Mark Lemmons:
I like cookies.
Devin Elder :
I think that’s a podcast title here.
Mark Lemmons:
They’re for closers.
Devin Elder :
Oh, 100%, yeah. People that I talk to that are trying to get in the business, they’re like, “Gosh, should I start making offers?” No, no, no, “Should I start building broker relationships?” And it’s like, whoa, can you get the loan?
Mark Lemmons:
Yes.
Devin Elder :
Can you get the equity? If yes to both of those, you may need some more stuff, but those are big things. Then, shoot, yeah. Maybe so. If you have no idea how you’re going to get the loan, and you have no idea how you’re going to get the equity, please don’t talk to brokers.
Mark Lemmons:
Right.
Devin Elder :
You’re just going to burn that first impression.
Mark Lemmons:
Exactly. Burn the bridge before you even built one.
Devin Elder :
Yeah. That’s right. I mean, it’s just, that’s too many steps ahead.
Mark Lemmons:
Yeah.
Devin Elder :
But going back to you guys’ capital raising ability, it’s like that is really kind of the engine on this thing. You guys have that, and then you can build the operational pieces around that. What are some things you guys are doing today? Again, I like the idea of kind of talking to yourself two years ago, operationally day-to-day stuff that it maybe made little easier for you, that you would recommend to somebody that’s kind of getting started in this.
Mark Lemmons:
Yeah. I’m a fan of kind of some rhythms and kind of a flow to my schedule.
Devin Elder :
Yes.
Mark Lemmons:
So that there is consistency in that. So I’m a big, I didn’t used to be this way, but I have grown into the person that really relies on my calendar. If it’s not on my calendar, it’s not going to happen.
Devin Elder :
Yep.
Mark Lemmons:
So, one, I want some margin in there so that there’s some flex time, because stuff does pop up, and there are fires you have to put out here and there.
Devin Elder :
Of course.
Mark Lemmons:
Sometimes literal. But for the majority of it though, you want a consistency of, okay, we’re going to meet on Tuesday mornings at this time to do this. And then, Thursday afternoons, we do this. And yeah, we’ll tour with you, broker. But my window for doing that is Tuesday and Thursday afternoons, and that’s it.
Devin Elder :
Right.
Mark Lemmons:
So, fit it into there, and we’ll go, but rather than bending to, “Okay, whatever you want,” and whatever anybody wants, because there’s 1,000 people coming at you.
Devin Elder :
Yes.
Mark Lemmons:
The more you do this, the more people are coming at you. And so, you can form your schedule, or you can let people form your schedule. And so, I’m a big fan of forming your schedule and kind of sticking to those boundaries and kind of those rhythms, again, of that schedule.
Devin Elder :
Yeah. That’s such an important point, because in a lot of ways in business, you have to have a do-whatever-it-takes mentality. And in a lot of cases, that’s absolutely true, but that mentality kind of lets us let people run all over our schedules sometimes.
Mark Lemmons:
Oh, yeah.
Devin Elder :
And you’ve got to be disciplined, because nobody’s looking out for your schedule except you.
Mark Lemmons:
They’re not looking out for your mental health. They’re not looking out [crosstalk 00:26:51].
Devin Elder :
Yeah. That’s right.
Mark Lemmons:
Right? I mean, they’re not looking out for your family time, any of that.
Devin Elder :
That’s on you.
Mark Lemmons:
You have to.
Devin Elder :
Yeah. And it’s tricky, because we kind of look at money all the time and expenses, income. But if you look at your dollar per hour value when you’re working, it’s probably pretty high. And you should look at that too. Hey, before you let somebody put 30 minutes on your calendar, well, is that worth $100, $1,000?
Mark Lemmons:
Right.
Devin Elder :
You don’t tend to think about it in those terms. But I like having that discipline around the calendar, because that is definitely your most important resource. Hands down.
Mark Lemmons:
Right. Nobody gets any extra time. We all have the same amount. It’s how we use it. Right?
Devin Elder :
Yep. Yep. I love it. Yeah. That’s a good approach. So, I guess we could talk about the deal since it’s closed out, but you’re still working on the closing process. How is the closing process going for you guys on this acquisition?
Mark Lemmons:
I would say great, because we have a good team.
Devin Elder :
Right.
Mark Lemmons:
And so, our loan broker, rock solid. I was on a call before this, and it was just like, I’m just on the call, but I don’t really need to be on the call, because we have a great team that’s handling all of this stuff. Yeah, I had to upload some docs here and there, and show some financial capabilities and all that, but it was, because of the team we have, it’s a lower load that we have to carry.
Devin Elder :
Right.
Mark Lemmons:
And so, our legal counsel, strong. Our lender, strong. And the lender that we’ve chosen, strong too. I mean, they’ve got their ducks in a row. They’ve got their process in line. And so, it’s flowing along relatively smoothly overall. We’re still gathering money from the investors that have committed to the project.
Devin Elder :
Sure.
Mark Lemmons:
And those are just relationships and conversations, but all is well on that front. And we’re good to go. So. It’s really just a matter of kind of waiting.
Devin Elder :
Right.
Mark Lemmons:
So, because we have the team, it’s really just a hurry up and wait.
Devin Elder :
It is, yeah. That’s funny. We went through due diligence a few weeks ago on a deal that we have under contract, and it’s kind of a lot of activity up front. Are we going to win the deal, negotiating it? But then, sign the contract, do your due diligence, launch the deal, raise all the money. And then, okay, we’ve got two months before we close, which our team-
Mark Lemmons:
What are we going to do now?
Devin Elder :
… Yeah. The teams have to be ready to go, but there is this kind of no-man’s-land lull, which is great.
Mark Lemmons:
Yeah. We’re in that lull.
Devin Elder :
Yeah.
Mark Lemmons:
Yeah. I mean, it’s good to be in the lull, though, honestly.
Devin Elder :
Yep.
Mark Lemmons:
There’s a rest in that lull.
Devin Elder :
Yep.
Mark Lemmons:
I’m a fan of rest and just not hustling all the time. I used to hustle all the time.
Mark Lemmons:
And I think I had this need to just kind of prove myself out there, and I’m learning to let that go.
Devin Elder :
Right.
Mark Lemmons:
Not a finished product, but learning to let that go and operate from a place of peace and rest. And it’s finished and the work is done, rather than, oh, I’ve still got to prove and earn and justify and show. I don’t think that’s a great place to operate from.
Devin Elder :
Right. Yeah. That’s one of the nice things about doing these big deals is one big deal’s a meaningful part of your year.
Mark Lemmons:
Exactly.
Devin Elder :
On one transaction. And it beats-
Mark Lemmons:
And there is, it’s nice.
Devin Elder :
Yeah.
Mark Lemmons:
There’s a lot of comfort in that.
Devin Elder :
Yep.
Mark Lemmons:
For sure.
Devin Elder :
Yep. For sure.
Mark Lemmons:
And it’s a whole lot of work to get to that point.
Devin Elder :
No doubt.
Mark Lemmons:
The reward is there.
Devin Elder :
Yeah. Once you’re in the game. Well, if somebody wants to learn about FLW, about you, connect with you guys, how can they do that, Mark?
Mark Lemmons:
Yeah. You can certainly jump on our website, flwcapital.com. On our website, you can schedule a call with us, 15-minute kind of consultation, investor relations kind of call.
Devin Elder :
Sure.
Mark Lemmons:
You can email us from that as well. Check us out on social media. We have a Facebook, and I think we have Instagram. I don’t really know.
Devin Elder :
Yeah. Who knows about that?
Mark Lemmons:
I don’t really deal with that a whole lot, but yeah, we certainly would love to connect.
Devin Elder :
Yeah. Awesome. Well, we’ll link to it in the show notes, flwcapital.com. It’ll be there if you listen to this episode. Mark, super for what you guys have done.
Mark Lemmons:
Thank you.
Devin Elder :
Excited to be partners with you and investor on some deals.
Mark Lemmons:
Yeah. And let me say, thank you, because I wouldn’t be here. I wouldn’t be sitting at this table if it weren’t for you.
Devin Elder :
Awesome, man.
Mark Lemmons:
So, thank you.
Devin Elder :
Nothing, honest to God, nothing makes me happier, because it’s one thing I’ve been able to go build a business, and it’s change my life. To see somebody else going through that at, I mean, seriously, your partner, James, who I’ve been friends with for a long time, we were at a conference. And just feeling his energy of where he’s at and actually doing these things. He’s so fired up.
Mark Lemmons:
He loves conferences too.
Devin Elder :
Yeah, he does. Yeah. That gets me fired up, really like nothing else, man. So, you guys are changing your lives. You’re changing your investors’ lives. It’s work, for sure.
Mark Lemmons:
[crosstalk 00:31:46].
Devin Elder :
But it’s awesome to see. So, continued success.
Mark Lemmons:
Yeah. Thank you.
Devin Elder :
All right. Talk soon.
Mark Lemmons:
All right.