Ep732: Gino Barbaro – Buy Right, Finance Right and Manage Right

Andrew Stotz 00:01
Hello fellow risk takers and welcome to my worst investment ever stories of loss to keep you winning in our community. We know that to win in investing, you must take risk but to win big, you've got to reduce it. Ladies and gentlemen, I'm on a mission to help 1 million people reduce risk in their lives. And I want to thank you right now for joining that mission today. Fellow risk takers this is your worst podcast host Andrew Stotz from a Stotz Academy, and I'm here with featured guests, Gino Barbra Gino, are you ready to join the mission?

Gino Barbaro 00:39
I gotta get my DJ voice on to Andrew. I'm doing good brother. How you doing?

Andrew Stotz 00:43
I'm doing excellent. Yes, I love that's my radio voice ladies and gentlemen. You know, so I'm excited to bring you to the audience because I also you know, I really appreciate your energy and following a little bit about what you're doing and listening to you and seeing that you're a natural on the on the on the TV on the on the telly on the video on the audio. So, let me introduce you to the audience. Gino is an investor, business owner, author, and entrepreneur. As an entrepreneur. He has grown his real estate portfolio to over 2120 multifamily units and $280 million in assets under management. Gino and his business partner Jake are teaching others how to do the same through Jake and Gino, the premier multifamily real estate education community. Their Students have closed over 71,000 units and have 4 billion in deal volume. Gino is a best selling author of three books, wheelbarrow profits, the honeybee, and food, a family food and the friars He currently resides in St. Augustine, Florida with his beautiful wife, Julia, and their six children. My goodness, do you know take a minute and tell us about the unique value you are bringing to this wonderful world?

Gino Barbaro 02:09
That is a great question. The unique value? Well, after living on this planet for five decades, plus, I've learned a lot of lessons. And to me the biggest lesson, the biggest value that I can bring is to have my family and really to be a role model for my kids, and to be a role model for others who want to have a family. For me family life is so important. And I think it starts with the family. And it ends with the family. And I think all fathers out there need to be leaders. And as I've been going through this journey, and I become an entrepreneur, I see that being a father and being a business owner. There's so many skills that are so intertwined. It's family life and the business life, it's very similar having core values, having mission statements, having those, those ideals that you want to pass on to your team members, and you want to affect other people's lives, you want to create impact. And as a father, you want to do that for your family. And I think as a business owner, you want to do that to your employees and your customers. So I think the unique value that I've been creating is through the Jake and Gino community, teaching others how to buy real estate, but also being a mentor them and seeing if a pizza guy can start out with losing millions in real estate and finally figuring it out. If I can do it, then anybody can do it.

Andrew Stotz 03:31
I love that. And the family thing is interesting. You know, that is a unique angle that you bring. And, you know, I'll tell you a story when my father was 82 He passed away seven years ago at 82. And I talked to him briefly before that, you know, fateful day. But I asked him, you know, out of all the different things that he had accomplished in his life, I sit down what is your most proud accomplishment? And he said, I built a trusting family. And it just, I mean, I tear up, you know, just, you know, I just feel the knots in my stomach. Because my dad was not never set some huge ambitious guy. He never was an entrepreneur like you. He was a businessman and work for one company all of his life and all that but he literally and now when I look back, I realized, you know, our family, my parents never betrayed my trust ever. And my sisters and I never betrayed each other's trust. Yes, we push the limits. But that happens, you know, but the point is, is that we always were trusting. And now when I think about it now in relation to the community that you've built, why do people want to join your community because they trust that, number one, you're gonna have their interests at heart. Number two, that you've been there and you've done it, you know, as you've just explained, so where does trust Where's trust fit in with your family and your community?

Gino Barbaro 05:00
But trust fits in that I have to get the job done. I was in Italy on vacation three weeks ago, it was August 27. And I had a student who called, I said, give me a call, I'm on vacation, took pick up the phone was 10pm. At night, he's going through a refinance, he's refinancing up to million dollars out of his property out of one of his deals, he got a really bad appraisal, I had to walk him off the ledge. There's the trust, I'm here for you, if you need me, I don't care if I'm on vacation. I've had students call me on Christmas Eve ice on restaurants. So I always worked on the weekends, I always worked during the holidays. So when I'm doing this real estate gig when people say, Oh, I'm working so hard, you ain't worked hard until you worked in the kitchen when it's 110 degrees, and you've got five people screaming at you that they want their food five minutes ago, and someone brings back the lasagna because it was burned and they want their 10 bucks back. That's hard work, talking to somebody on the phone and letting them know that you're there and letting them know that you're trying to change your life and trying to help impact your life with a $2 million refinance. That's actually a lot of fun. So if I've got to stop my day, for a few minutes and help somebody out, that's actually a privilege for me. And I'm, it's an honor to be part of that journey for that person. And when you impact one person, you impact the entire world because that one person shows up differently for the rest of the world. So I think everyone really needs to start out with the thought process of think about purpose over popularity, we're always going for being popular, if we can focus on what our purpose is in life and build on the purpose. Ultimately, the popularity will show up.

Andrew Stotz 06:30
Oh, that's such a, you know, a great reminder for all of us that, you know, in our communities and our families, in our businesses to be there, you know, and to be someone that's accessible, and also somebody that listens, I mean, you can't give good advice if you don't listen to what the situation is. And I think that, you know, many people seems like people these days want to be able to do something where they don't connect that much. And I don't want to have all that interaction. You reminded me I worked at an Italian restaurant in Hudson, Ohio, or actually, it was still Ohio outside of Cleveland, called parisons. And I was washing dishes in I was probably I don't know, 17 Maybe 18. Could be it was tough, frickin work standing all day. And by the time you finish that day, we all back in the parking lot talk and and stuff and everybody's you know, you not only do you feel physically exhausted, but you also feel like accomplishment, like I really did something like you can actually show what I did we move 500 people through that restaurant, you know, in that type of thing, and just just brought me back to those days at parisons. That's awesome. Love. But I also hear from you is the attitude of gratitude to the be grateful for what we're doing and that it's not, you know, let's not let's not call ourselves doing some heroic things, you know, firefighters are doing that and people who are working in the kitchens in working in tough environments and physically pushing themselves. That's tough work.

Gino Barbaro 08:06
Yeah, Andrew, I learned all these lessons over a long period of time. And I do regret my earlier journey with the restaurant. I opened the restaurant in 1994 with my family. And it was great until oh seven, my dad passes away and oh seven and I'm thinking about my living his dream or living my dream. And the mistake that I made with the restaurants I couldn't scale it. I had one restaurant for 20 years. I retired in 16. And went the real estate full time. But this is for the business owners out there. When I started the restaurant and I had the restaurant. My mindset was I started this business to provide for myself and my family. And when you have that mindset, it's all about you. You're not really serving the customer. When I had the mind shift with real estate and with the investors and maybe raising capital for a couple of syndications. You're really doing that business. If you have in the right mindset, you're trying to provide value for your customers, you're not, you're not starting the business for you, you're starting the business to really solve a problem or to create value for them, whether it's your customers or your employees. And then ultimately, if you have that mindset, it's going to come back to you tenfold. And I had it backwards for all those years. And don't get me wrong. I didn't appreciate as much as we did mitzvahs, we did weddings. We did communions confirmations, we were really a really staple of that town for so many years. I just didn't appreciate it. And I didn't understand when somebody came home tired late at night, they were coming into the restaurant, they were taking food out because they didn't have time to eat. And they actually brought the food home and they were able to sit around the dinner table with their, you know, their family. I didn't appreciate that. And I did enjoy that I did not enjoy it. And if I had stepped back and I was looked at it from that perspective, I would have loved what I was doing. I may have even opened up a couple of more restaurants, let's say but I didn't enjoy the journey. And I didn't have the right mission or have the right core values, the right mindset to open that business. So for everybody out there opening a business, it's not about you. It's about the problem you can solve and about the people that you're going to serve.

Andrew Stotz 09:57
Now let me ask you was that your worst investment ever or Is that just a side story up to your worst investment ever?

Gino Barbaro 10:03
It? No, it was a great investment we did really well. My mom owned the building. So she I paid her rent and we had three rentals upstairs. So I thought, hey, real estate is great, you're gonna make money with real estate, you can't go wrong. I mean, she could barely speak, she could barely speak English when she came to this country. And my dad, same thing. And you know, if we want to dive into the worst investment ever?

Andrew Stotz 10:22
Well, let me let me ask for that for a second. But I love the story of restaurant and I've had a lot of, you know, I have a lot of thoughts about what you've just said, but I think we're gonna we're gonna get to that. So now it's time to share your worst investment ever. And since no one goes into their worst investment thinking will be tell us a bit about the circumstances leading up to then tell us your story.

Gino Barbaro 10:44
A person with money needs a person with experience, the person with the experience gets the money, the person with the money gets the experience. And that was me. My very first big investment by myself it was the year was 2005. And it's ironic, how are we during these bubbles, these market cycles when the markets up, we will make these stupid decisions because money is easy. I mean, look, think about this market cycle. You have same bank and fried, you have Elizabeth Holmes, you have all these banks failing because the money is cheap. And hey, I had literally 170 $72,000 sitting in the bank. I said to myself, my friend comes over, actually is my accountant. And he said, I've got an investment for you. And he had investing with this gentleman for years. And because this guy's doing mobile home parks, I said mobile home parks know nothing about it. Okay. The gentleman comes in. He's driving a gold Mazda Rottie. He comes into the restaurant and sits down and he throws me his pitch. And from that day forward, I would call him Masrani. Mike, every time I saw like Gomez Roddy, I said, Mazda Roddy Mike, and I knew nothing about the deal. I never flew down to the deal. It was in Florida. masriadi Mike was driving $100,000 Plus car, he probably had a $300,000 home didn't make that I never thought about where is he getting all this money. And it was all about me. It was all about my mistakes. And I had the claim responsibility. Given the money. It wasn't it was a syndicated deal at the time did notice syndication was didn't know how to underwrite deals, never thought about going into partnership with somebody about aligning values. And he had no skin in the game. The first six months were great. I was getting distribution checks, working at the restaurant working my butt off. Six months later, they stop, then no phone calls. And then I say to my friend, Todd Todd, what's going on? Well, Todd had money in the deal also, and come to find out. We look at those parks online. And they are awful. I mean, they're in the middle of nowhere. I don't even know what the median income, maybe the median income was 10,000 bucks. I mean, I made every mistake possible. And you in our framework at Jake and Gino, we teach by right? Managed right? And financed, right, those are the three pillars, you can use them to buy a business, you can use them to buy a multifamily, you can use them to buy a single family home. When I look at that through the lens of that investing framework, I didn't have it, I didn't even know what it was. I'm buying this asset. I don't know how to underwrite or analyze a deal, right? I don't know how to choose the market itself, the market was good. But the sub market where the asset was was terrible. I had no criteria. I didn't know what I was trying to get out of this. The whole idea the whole law of passive investing. It's not passive, someone's got to do the work. And masriadi Mike wasn't doing the work, he was driving his Masrani around. That's the problem. The Manage right portion, we call it three pillars because the back two pillars of a wheelbarrow are the buyer right? And the finance, right, the front of the wheelbarrow is the wheel itself. That's the Manage, right, it's got to be in constant motion, somebody has to tend to the baby, I've got six children, I've got to raise them with my wife, if I don't raise them, they become raving lunatics. While this property became a raving lunatic. After a year it was in the news and everything. Nobody's managing the store. And finally a finance right, well, financing terms, there was a little seller financing in their little bank financing. And I mean, Todd and my brother was in the deal also, where the finance partners of this deal. So I mean, every thing possibly wrong that you could do in that first deal. We did it. And it was a great learning experience. Andrew, what I learned from it was learn how to pick your partners. And it's really values based decision making. Learn a framework that's going to actually be suitable for what you're trying to do understand what your investment goals are. Trust but verify. And I went back at it again. My next investment wasn't great either, but just continue to learn. And what I learned from that is real estate can be really powerful. You can really make a ton of money real estate, you just have to know what kind of real estate you want to get into pick a niche and solve it and I didn't know anything about mobile home parks, mobile home parks, at that time in 2008 2009 2010. were phenomenal investments there 1518 20 caps because people didn't know anything about Got it private equity got into them. In the last seven or eight years, they've driven down the cap rates. But at that time, that investment was amazing. I just just didn't know what I didn't know. And I hope I've shed enough paint on that, because I remember him coming back to me sitting in the restaurant in the parking lot, and him saying, you know, money's gone, and I'm like, Dude, I'm gonna sue you. And I let it drag on, the attorney did nothing. And I really didn't have anything. I didn't have any paperwork. This gentleman actually was fraudulent because he's raising money. There was no private placement memorandum, there was no subscription agreement, there's no opera, there was nothing. And I didn't know that. And you know, I can go and blame, I was ready, Mike, all I want. But at the end of the day, in 2008, when I read the T Harv, Eker, book, Secrets of the Millionaire Mind, it talks about responsibility and fruits in your roots. And that's what I said to myself. It's not my fault. It's my fault, because I didn't do the right thing I didn't learn. And that's what I said to myself time to get my education, I got it the hard way. You either learn on the street, or you learn in the classroom, I learned on the street, it cost me a ton of money, and I got my ass in the classroom still cost me money, but it was a lot quicker. And I learned a lot more stuff a lot faster.

Andrew Stotz 16:07
That's such a great story. And for those people, you know, who are listening and viewing, you know, this is a masterclass where you can learn right here in the classroom, and learn from others. So let's just go back, you've mentioned a bunch of things, but let's just reiterate those, how would you describe the lessons that you learned?

Gino Barbaro 16:26
Well, the first thing, when you're going to partnership for business is somebody, really, first thing you need to understand is what are your values, I didn't really write my values down, I knew them. But for me, it was integrity. It was hard work. It was being held accountable, being responsible. And I met Jake in 2009. I'm like, that's the guy, that that's what I want. I didn't know that in oh five, I had to go through that. And oh five to learn that. And everything was values based decision making, that was the most important thing. Just because you've had a bad relationship, don't assume, as we say, in life coaching to make an assumption that the next one's gonna be the same thing. You're just kidding yourself, you have to understand. The second part is due diligence, you need to understand what you're investing in. And if you don't know how to do due diligence, you go out and you hire an attorney, or you find a company that can help you with it. The third one is learn a process, every kind of investing has a process where you're investing in stocks, bonds, real estate, our process that we found that through dealing with the real estate was by right managed right and financed, right, you go through that lens, and you try to hit on every single pillar that you possibly can. And I think the last one is the financial underwriting, you need to know how to underwrite an asset, and see the numbers and see if the numbers make sense. One more. You yourself, what are your goals? What are you trying to accomplish with this investment? It's not always chasing the highest yield? Is it comfortable with your I guess, goals, read the psychology of money by Morgan Housel. And understand the relationship you have with money. It's so powerful. And once I understood the relationship that I had with money, I'm like multifamily is great, long term, boring, slow, you know, create wealth, that is what I want to choose. And I mean, I chose the right vehicle. I just didn't understand all of these concepts I'm explaining to you right now.

Andrew Stotz 18:15
So much, so much gold there. Let me just maybe I'll share a couple of things that I take away. So first of all, you've mentioned values, you've mentioned, due diligence, you've mentioned process, and your process by right. Finance, right? Manage right, great stuff. And, by the way, Morgan Housel was episode 255 on the podcast, where you can listen to his story of a successful value investor focused on why a stock is cheap. In fact, that was right about the time he was coming out with that money, the psychology of money. What I'm thinking about is that for most people, when they accumulate a reasonable amount of money, it's like they think they're in the big money world. And now I got no opportunities. And what they don't realize is that, what I like to say is never invest with somebody who approaches you with an investment. And now, that's a little bit, you know, extreme people go wait a minute, how am I supposed to find out what to invest it? But my point is that, you know, do your own research. And I've learned from this podcast, we have six common mistakes that people make, but the number one mistake that people make is they don't do their research. And so that's the due diligence part. You've also talked about the values part, and I think about I have a business now for 28 years with my best friend, and we grew up outside of Cleveland, Ohio, in a little town called Hudson. But we had friendship for years and we've got this business for many years. And I now listening to you talk I made me really realize that well, we have, our values are totally aligned. And therefore, any conflict, any problem is resolved along the lines of those values, which we part of our value is we value our friendship, more than our business partnership. So if we saw something that would damage our friendship, we both agreed that we wouldn't do it, we wouldn't even be in the business. And so values is such a great one. And ultimately, when you think about this type of investing, there's so much work that's got to be done. To make sure you get it right. It's so easy to lose. You know, it's not like investing in a stock. A stock is hard, for sure. But you can sell it tomorrow in the stock market. And but with illiquid types of investments, it requires much more due diligence. So, so many different things. And anything you would add to that.

Gino Barbaro 21:03
Well, when we compare stocks with real estate, they're different. Animals are different beasts, stocks, it's harder to generate wealth with stocks, because they are pushed the button, we always buy high, and we sell low. I mean, that's that's the natural tendency. So there's always a pro to life. And there's the con to the pros, you can get out the con is you can get out. I mean, how many people do you know, bought Amazon back in 2000. And still on Amazon, they don't, because they made 300%, they sold out. And I still own our very first deal that Jake and I bought back in 2013. It was a 25 unit property, we paid $600,000 For today, it's worth two and a half million dollars, we have $500,000 of debt on it, it's paying us $8,000 On average, every single month, we've still own that. That's how you create wealth. It's slow, it's boring. But the thing that I love about real estate is if you understand that, it's a team sport number one, and number two, it's scalable, you can create a business within the business. And that's what people get wrong with real estate. It's not just an investment, it can become a lifestyle, and it can become a business and what we say Jake and Gino is we create multifamily entrepreneurs. That's why you're not buying three or four single family homes, it's not easy to scale those or to manage those. But if you can buy a 10 unit apartment complex, well 10 units in one spot a lot easier to scale up a lot easier to create a business around there, there's your little cash machine of 10 units. And I think that's the difference. That's the that those are the pros of multifamily and real estate, but like you said, the cons, and you're going to deal with people, you're you're you're gonna have to create systems, you're gonna have to actually learn how to have some type of customer service, you're gonna have to learn how to deal with vendors. But if you're working in a W two job, don't you have a boss? Don't you deal with that anyway? Why don't you either say to yourself, let me move over to this side of the ledger, or at least I own it, I get these amazing tax benefits. And I can create wealth. You either gonna complain about your W two job, your small business, or the real estate, pick your poison. I had the small restaurant, I picked my poison there, I decided this multifamily thing. Not too bad, I smoothed over to this side of the ledger. And I haven't looked back. So based on

Andrew Stotz 23:12
what you learned from this story in this experience, and what you continue to learn, let's go back in time and think about a person like yourself Maza rowdy Mike drives up tells you about this great idea. It all sounds exciting. What's one action that you'd recommend our listeners take to avoid suffering the same fate?

Gino Barbaro 23:33
That is a few. Get on the plane, fly down to the property. Take some pictures. I could have taken a $500 airplane flight to what to where it wasn't Florida, gotten off the plane walked the property and said holy moly, what is going on here? And I would have saved the entire I was had no I'm going to pass on this. And the thing that bothered me about this was he had a track record. So it's like he already is an operator. He's already gone full cycle on a couple of deals. He's already done a few deals. So his track record wasn't wasn't in question. I had a friend who actually was doing business with him for years. I just didn't understand the ramifications. And I didn't I didn't understand the whole idea of raising capital that was very new to me back then. And when your thing is when money is loose, and money's free and money's cheap, you tend not to value it as much and I had this idea of I'm too busy. And I think people have to say to themselves are you working hard for your money or is your money working hard for you and I once I took that approach and I made every single dollar Andrew we called dollars that Jake and Gino we call them baby money soldiers. And we use this term because every dollar that comes into your existence has to be utilized in a certain way. You can either spend it as an operating expense, you can spend it as a luxury. You can invest your dollar into a dealer into an asset. You can hold it as reserve put into whole life. You can use it for estate planning You can use it for charity, you can use it for education, however you use, it will determine how you become wealthy. You're trying to accumulate as many baby money soldiers as you can not kill them. By spending them on luxuries and putting them into assets, let those assets procreate and create more baby money soldiers by refinancing by selling equity and putting them in buying more deals and more deals. That's the simplicity of creating wealth. It's pretty simple. It's not easy. But that is the game plan. And nowadays, it's hard for people to create wealth, because there's so many things out there to buy the new iPhone every year, with a cell phone bill, you have a mortgage, you have Wi Fi, you have ring, you have Amazon, and all of these expenses. You know, people say to themselves all I need it. Well, do you need it? Because if you do, you're killing your baby money, soldiers early on, buy those assets, let those assets create that cash flow that can pay for those expenses, and then continue to reinvest those big money soldiers into new deals or into new assets and into new investments.

Andrew Stotz 25:59
Like GI Joes now,

Gino Barbaro 26:01
it's a great, it's a great, like, if you're thinking about it, think about the dollar, you'll have respect for it. Because you say to yourself, I'm earning so much money in my life, the average person if your average, you know, income is 50 or $60,000 a year, over a 30 year period, you're making about 2 million bucks. Why is everyone why is everyone retiring completely broke? Because they didn't utilize your big money soldiers properly?

Andrew Stotz 26:23
Yeah, and that there's a great book on that one, your money? Or your life? Oh, yeah. Like I highly, highly recommend this because it talks about the, that money is just a representation of your energy. Yeah. And when you look at, you know, buying that new TV, you realize, wait a minute, this is not, you know, $1,000, it's seven hours of work? Yes. And I've traded those seven hours of leisure or whatever for to do those seven hours. And all of a sudden, it's like, I'm not buying that. So but I like what you're talking about is kind of the other side of that is that what can this dollar do for me. And I just wanted to given that my background is in academics related to finance and professional finance. I just want to dispel a myth that you've already mentioned and that is, there is no such thing as passive income. And I can prove that for one simple simple thing. We all have seen the hockey stick chart of compounding interest. And as interest compounds, we see that it exponent it rises exponentially in the later years. Well, the first thing is, the later years means after 20. So if you think you're compounding over 10 years, it isn't going to happen that compounding and Warren Buffett is the example where he's compounding his money in his ADF, you know, seven years, seven years a year or so of compounding. And so the impact is massive. That's the first thing. But the second thing is what most people don't realize is that in order to have a non linear rise, to get that exponential rise at the ending period, you cannot take anything out of that money. Yeah, and that means you can't take any capital gains, it means you cannot take the dividends that come out of that, or the profits that come out of that they must be reinvested. And they are reinvested, in the formula that calculates that return and calculate that. But most people don't realize that it's in there. And if you extract that, and say, well, we've got a dividend of 1000 bucks, and I'm gonna go out and spend it on, you know, a nice weekend way with my wife, then you've just taken an exponential curve and made it linear. And so there is no such thing. The only way that you can say this passive income, I would argue is if you're talking about having 20 million 30 million 50 million 100 million dollars, where you know, then what's passively being earned on that money can be extracted, and you still don't, you're not going to run out of money.

Gino Barbaro 29:03
Yes, you make a great point. And we have a framework at Jake and Gino that we call the conveyor belt theory. And it's basically if you think of an imaginary conveyor belt, you're buying assets, you're one you buy one home, you're two you buy another home. So on this conveyor belt, you have assets that are matriculating. And in real estate, you don't make money. When you buy you make money. When you sell, you're still making cashflow. But you what you're doing is you're extracting the equity out of either that's a refinance or a sale, that equity needs to be repurposed and crystallized and put in the next deal. And that conveyor belt after a five year period. So let's say the average is a five year old, you go from a single family home to maybe three units to maybe a 10 unit to maybe a third unit and you're trading up and you're trading up assets and you're trading up equity, but you need like you just said to continue to reinvest and a certain point those baby money soldiers start taking hold and they start really building up and really truly building up. So for those of you that are working in a W two and saying, I'm going to quit my job and go into real estate or go into stock trading In full time, hold on a little bit longer the profits you're making in your stock trading or your real estate portfolio, let those compound and put those back into the business and continue to work your job. So your job can pay for the lifestyle and the business that you're building can continue to reinvest and continue to grow. That's probably a really big lesson that I learned over the last 10 years or so.

Andrew Stotz 30:20
Yeah, and the money doesn't I mean, ultimately, you're looking at your total wealth. So whatever cash flow is coming out of any particular one just needs to be reinvested in that total wealth, you may say, I'm going to take that cash flow and put it in my next property, whatever. But it needs to be reinvested. And when I'm thinking of it from a military perspective, with baby money, soldiers, also you could think of that cash flow that you're getting as your bullet. Here is your bullet this year from this property. And it's $10,000, where you're going to shoot it.

Gino Barbaro 30:51
Yes, I like that. And I'll take it one step further. You're talking about borrowing money from the bank. When you borrow money from the bank, there's a cost. Borrowing money for bank is like a mercenary, you're paying for your than for the money. There's mercenaries right there. So you can go down a rabbit hole with this concept and making people understand, you know, the concept of money, these rules of wealth, they've been around forever. As you said, Warren Buffett, I think 61 out of $65 billion net worth was after the age of 80. It's insane. What what what, what the compounding element didn't, he's one of the most top investors on the planet. So it took him a long time to continue to scale up and continue to reinvest his wealth. So it doesn't happen overnight. But if you stick with the plan, you stick with the framework. His is pretty simple. His framework or simply looks for deals that are undervalued, he loves brands, and he goes out and invest in really great companies. He hasn't made that many investments over the lifetime. But he's made some really pretty damn good investments.

Andrew Stotz 31:44
He knows where to direct his bullets, that's for sure. One of the interesting things in one of my finance classes I did is I pulled up a website that we use in the world of finance called portfolio analyzer. And I put in Berkshire Hathaway stock, and I put in the s&p 500. And I said, analyze these two, the performance of these two over the past 20 years. And what shocks everybody is that his performance has been in the last 20 years, the same as the s&p 500. Why that? No, nobody realizes that. It was the great investments that he did in the early days, that he then let in 1975, or 1979, he earned 120%. Another year, in the 70s, he earned 100 plus percent another year in 1969, he earned a huge amount. And the end result is that those early wins, he allowed the compound and that's why he's ending up with his huge amount of money, even though the last 20 years have been tough to beat the market, given he's got such a huge amount of money to manage. So I ought to include that in this in the show notes. So that to show it a little bit.

Gino Barbaro 32:50
That's a great point. I didn't know that. Thank you for sharing that.

Andrew Stotz 32:52
So let's talk about a resource. I mean, you are such an expert in this area. And I can already see the value that you're bringing into your community. Maybe you could talk about, you know what you're doing in the community or any other resources that you want to recommend.

Gino Barbaro 33:07
You know, we do a podcast Jake and myself. And like I said, we just interviewed Chris Voss, we have some amazing guests on my wife and I do a podcast, just go to Jake and gino.com, you'll see the podcast tab there. I love for people to listen to the podcasts because we like to interview thought leaders, we like to interview people to think outside the box entrepreneurs, people who are building and scaling businesses, because when you speak to them, what I've learned is I can walk into a restaurant, sit down, have my son fill out an application, and I go, wow, that online system is amazing. I can use that for my real estate business, or I can use that for my education business. So what I love is just talking to people who are in the business world, and really systems and scaling, they really cross pollinate across one industry. And the next and I know that's true, because my wife, we're doing something the education and we just switched something over. And she's like, what took you so long to do it. That's like, you know what, I finally went to an event this week, and I saw how they did it. And I should have gone to the event sooner. And I'm like, Man, I wish I had done it sooner. So for people out there, don't be afraid to go into other industries. If you're in the real estate space, go listen to somebody who's in the restaurant space and vice versa. But just to go out there, just go to Jake and Gina rock comm we've got a ton of resources out there for people.

Andrew Stotz 34:16
Fantastic and we'll have a link in the show notes to that too. Last question. What's your number one goal for the next 12 months?

Gino Barbaro 34:25
That's a tough question. We've we've you know, this has been a good year for us real estate wise, everyone's complaining about multifamily. We've closed two deals 200 units this year. And we've got another 96 units on the contract. So we've got 300 units for this year, which you know, no syndication, it's on capital me Jake and my partner. I mean, for the next 12 months, we nice to do another 300 units for us personally, hopefully, just to continue to scale the education company continue to bring students on and to grow that those are the only two goals that I have right now in my life.

Andrew Stotz 35:00
Well, listeners there you haven't another story of loss to keep you winning. Remember, I'm on a mission to help 1 million people reduce risk in their lives and this episode certainly helped. As we conclude, Gino, I want to thank you again for joining our mission and on behalf of East Arts Academy, I hereby award you alumni status for turning your worst investment ever into your best teaching moment. Do you have any parting words

Gino Barbaro 35:24
for the audience? Continue to listen to Stotz as podcasts because you're going to hear a lot more horror stories. In the weeks and months and years to follow. It's only beginning the pain is beginning. Andrew, thanks for having me on. This is awesome. I really enjoyed it. Thank you.

Andrew Stotz 35:40
Amen. And that's a wrap on another great story to help us create, grow and protect our well fellow risk takers. Let's celebrate that today. We added one more person to our mission to help 1 million people reduce risk in their lives. This is your worst podcast host Andrew Stotz saying. I'll see you on the upside.