Meet Dave: A Real Estate Flipper Turned Passive Investor
Dave grew up in a real estate-focused family. His grandfather was the president of a brokerage. His godmother was a real estate agent. His aunts and uncles were also involved in real estate. While growing up, he would spend his weekends visiting open houses with his mother.
But Dave took a different path after graduating college. He settled back in the Bay Area and took a job as a customer service representative at a large tech company. While he had a good job at a growing company, he felt like he was smaller than a COG in a very large operation. He transitioned from this giant tech company to small tech startups where he began to see the power of his work. This is when he realized how much he enjoyed building and making things. And although he has led a very successful career in tech, he never lost interest in real estate.
A Lack of Time and Energy Leads to Passive Investing
To add to their income from his day job, Dave and his wife started flipping live-in properties. They would buy a house for their growing family to live in for a few years, fix it up, and then flip it at a profit just a few years later.
“We were just taking advantage of the market that existed at that moment in time,” Dave said.
While he found success flipping properties, the realities of a growing family made it more difficult for Dave and his wife to find time to focus on doing the renovation work themselves. They eventually looked at purchasing investment properties in the Bay Area, but high prices made the economics difficult. When they looked at properties out of state, the thought of configuring and overseeing management teams from a distance made them apprehensive.
“I love houses, and we still take the kids to open houses,” Dave said. “But ultimately [flipping] takes a lot of work and energy. Having the time and energy to do things outside of that was important to us. We realized that real estate was an asset class we wanted to be a part of and that we believed in, and we needed a different avenue to pursue that.”
All of the pain points related to flipping live-in properties (and investing in single-family rentals) led Dave to explore real estate syndication through Madison Investing.
“What we realized is that there are people who have better access to deals, better access to investments, and better access to the teams to make these properties and these investments work,” Dave said. “What Madison Investing does for us is connect us with those operators to make that work for our lives.”
What’s the Next Asset Class?
Dave believes that “everything goes through cycles,” and the time he spends at his day job and with his family means he has little time to dedicate to exploring the next attractive asset class. He leaves that to the team at Madison Investing.
“Working with a partner like Madison Investing allows you to say, ‘Hey, I’m going to put the work on you guys to find what the next asset class is going to be,” Dave said. “Whether that be ATMs, bitcoin mining, self-storage. I’m going to let them go find the operators they want to work with and have vetted with their own cash to make sure they work, so I can go and follow them alongside those deals and make them work for me.”
He’s willing to leave that work to Madison Investing for a simple reason: trust.
“Trust is a big part of any relationship, especially when it comes to financial terms,” Dave said. “At Madison Investing, I know that they see hundreds of deals cross their plate, and they only bring half a dozen to a dozen. So I know that the ones that have been looked at are strong. I know that the economics of them work out. I know that they put the time and energy into understanding the regions and what those things are. And make me feel comfortable putting my investment alongside theirs.”
Watch Dave’s story of how he reconnected with his passion for real estate.
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