Ep822: Dustin Heiner – Reselling Your Sawdust: The Passive Income Strategy Hiding in Your Business

By Andrew Stotz | 08/25/2026 |

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Quick take

BIO: Dustin Heiner is a real estate investor who quit his job at 37 with financial freedom and passive income from his real estate investing. Through his coaching, podcast, and YouTube channel, he has helped thousands of people invest in real estate.

STORY: In late 2019, Dustin was one signature away from leasing a gym that had nothing to do with real estate, then COVID-19 shut every gym in America and closed the deal for him instead. That near miss led him to a strategy that now runs quietly underneath everything he does: reselling his sawdust.

LEARNING: You do not need a new business to build a new income stream. Look first at what your current one is already producing, and throwing away.

“How does a smart man learn? He learns from his own mistakes, but a wise man learns from other people’s mistakes.”

Dustin Heiner

Dustin Heiner is a real estate investor who quit his job at 37 with financial freedom and passive income from his real estate investing. Through his coaching, podcast, and YouTube channel, he has helped thousands of people invest in real estate.

He is also the founder of the Real Estate Wealth Builders Conference, where he brings thousands of real estate investors together to connect and grow their investing businesses.

Dustin joins the podcast for the second time to unpack a business mistake he almost made in 2019, and the powerful lesson it taught him about turning overlooked assets into new revenue streams.

He first appeared on episode 144: His Life Went From Loss to Success When He Mastered Passive Income.

Catching up since 2019

When Dustin last appeared on the show, real estate had just freed him from his day job. Years later, the numbers have grown considerably. He now owns more than 30 single-family rental homes and is assembling a further portfolio of nine to twelve properties. Some individual properties bring in around $3,000 a month in passive cash flow.

But Dustin focuses not on the money he makes, but on the mindset behind his investing approach. He does not own a portfolio of properties and hope the market carries them higher, the way you might watch a stock. He runs a business built on real estate, and every property in it earns its place as inventory, not a bet on appreciation.

The gym that almost sank a real estate empire

Dustin’s core business has always been real estate. But in 2019, while his rental portfolio was thriving, he took his eye off the ball and chased a passion project: opening a gym. Dustin spent months trying to buy a property to set up the gym, but he couldn’t find one worth the price, so he decided to lease space instead.

This business model was completely outside his real estate expertise. He was about to sign the lease when COVID-19 hit, and gyms across the US were declared non-essential and shut down.

If Dustin had signed the lease, he would have been obligated to pay rent for a closed-down business with no income. This would be his worst deal, even though he didn’t make it in reality. What Dustin really lost was the time and attention he should have put into investments already making him money.

Reselling your sawdust

The lesson Dustin took from this experience is a concept he calls reselling your sawdust, a more practical way to earn passive income. To explain this concept, he describes a sawmill. Its main product is lumber, but it also produces sawdust, a byproduct that usually costs money to burn or haul away.

Instead of treating that sawdust as waste, some sawmills package and sell it as bedding for gerbil cages, compressed fire-starting logs, or filler in other products. The “waste” becomes a second profit center with almost no extra effort, because it was already being produced.

Dustin argues the same opportunity exists inside almost every business. His sawmill is real estate. Everything else—his knowledge, audience, systems, and industry relationships—is sawdust. Instead of chasing an unrelated venture like a gym, he found more value repackaging what his core business was already generating for free.

Five income streams built from the same sawdust pile

Dustin’s business now includes several ventures that all trace back to the same real estate sawmill:

Education: The Master Passive Income podcast and YouTube channel, which grew out of simply teaching people what he already knew about running rental properties like a business.
Community: The Inner Circle, an in-person mastermind hosted in Nashville, plus an annual Mastermind in Paradise cruise to the Bahamas that doubles as a tax-deductible retreat.
Software: From his internal systems and processes, Dustin built Income Builder, which systematizes the exact process he uses to vet, buy, and manage his own properties, so his coaching clients don’t have to guess.
Sponsorship revenue: Dustin now has more than 2.3 million podcast downloads and roughly 500,000 followers across social media, including about 300,000 on Instagram alone. This is an audience sponsors pay to reach.
Done-for-you investing: The Portfolio Builder Program, a $100,000 white-glove service for people who have money but not time, that delivers 20 cash-flowing properties in 12 months.

Each of these started as a side effect of running his real estate business, not as a planned product line. That’s the point: sawdust is rarely obvious until you go looking for it.

Real estate income is not automatically passive

Dustin draws a sharp line between investing and speculating. Buying a stock and hoping the price rises is a bet on value appreciation you don’t control. In his opinion, buying a rental property, unlike a stock, is like starting a business with recurring monthly revenue, real expenses, and inventory (the properties themselves).

Dustin says he doesn’t invest in real estate for appreciation but for monthly cash flow. This means treating each property like inventory that has to earn its place in the business regardless of what happens to its resale value.

Dustin works with several experts (property managers, contractors, and leasing agents) who help him buy property. Before he buys a property, he gets these experts to sign off first. He calls his property manager and describes what he is considering before he owns it, not after. If the manager says the numbers will not work, he walks away and loses nothing but a little time. Buy first and ask questions later, and a bad answer turns an asset into a liability that is already yours.

This upfront vetting is also what lets him spend roughly 30 minutes a month managing more than 30 properties and interests in nearly 1,000 apartment units. Rather than aiming to minimize hours worked, Dustin’s goal is to build systems thorough enough that the business runs itself, making the income truly passive.

Finding your own sawdust

If you’re wondering how to find your sawdust, Dustin’s challenge to you is simple: identify what your business (or even your job or hobby) is already producing that you’re not capturing. He suggests starting with a basic question: what do you do in your free time, for fun or for work, that other people would pay for or want help with?

For example, if you are a content strategist, consultant, or organizer, the research you compiled for one client, the frameworks you developed for one campaign, or the community you built for one cause could become a standalone product, course, or service if you package it well.

Andrew’s takeaways

A strength isn’t a competitive advantage until you convert it into cash flow.
Reselling your sawdust will more likely earn you more than starting something new.

Actionable advice

Audit your own sawdust. List the skills, systems, content, data, or relationships your current work already produces, then ask who would pay for access to them.

No. 1 goal for the next 12 months

Dustin’s number one goal for the next 12 months is to scale Income Builder.io, the software that systematizes his real estate coaching, from roughly 100 users to 5,000.

Parting words

“Get started and make passive income.”

Dustin Heiner

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About the show & host, Andrew Stotz

Welcome to My Worst Investment Ever podcast hosted by Your Worst Podcast Host, Andrew Stotz, where you will hear stories of loss to keep you winning. In our community, we know that to win in investing you must take the risk, but to win big, you’ve got to reduce it.

Your Worst Podcast Host, Andrew Stotz, Ph.D., CFA, is also the CEO of A. Stotz Investment Research and A. Stotz Academy, which helps people create, grow, measure, and protect their wealth.