Today we have a great guest. You will not want to miss this episode. It is short and sweet and full of incredible value. David Robinson, CEO and Founder of Canovo Capital, is an active investor, broker, and podcast host. As a broker and investor, David has been directly involved in over 350 million in real estate transactions. He has led top-producing real estate sales teams and managed a leading national franchise brokerage. He holds an active real estate broker’s license in the state of Utah. At Canovo Capital, David oversees all due diligence/acquisitions, capital raising efforts, investor relations, and asset management for his firm. David is also the creator and host of The Lead Sponsor Podcast, one of the fastest-growing commercial real estate investing podcasts in the country. Each week David interviews top syndication sponsors and investment fund managers from all over the country to extract their strategies, tactics, and secrets to help YOU on YOUR investing journey. When he’s not neck-deep in an exciting real estate transaction, he spends his time with his wife of 17 years, their 4 children, and golden doodle. He enjoys coaching youth football, trips to the cabin at Duck Creek Village, Utah, and sweating through hard workouts at Crossfit XD. Ready to learn more from David just head over to https://www.canovocapital.com/ And after that head on over to... https://easysell411.com https://billyalvaro.com https://billyssecrets.com Who knows maybe you will be our next partner? To get some neat (and FREE) Tools | Tips | Tricks to help you in REI!
Today we have a great guest. You will not want to miss this episode. It is short and sweet and full of incredible value.
David Robinson, CEO and Founder of Canovo Capital, is an active investor, broker, and podcast host. As a broker and investor, David has been directly involved in over 350 million in real estate transactions. He has led top-producing real estate sales teams and managed a leading national franchise brokerage. He holds an active real estate broker’s license in the state of Utah. At Canovo Capital, David oversees all due diligence/acquisitions, capital raising efforts, investor relations, and asset management for his firm.
David is also the creator and host of The Lead Sponsor Podcast, one of the fastest-growing commercial real estate investing podcasts in the country. Each week David interviews top syndication sponsors and investment fund managers from all over the country to extract their strategies, tactics, and secrets to help YOU on YOUR investing journey.
When he’s not neck-deep in an exciting real estate transaction, he spends his time with his wife of 17 years, their 4 children, and golden doodle. He enjoys coaching youth football, trips to the cabin at Duck Creek Village, Utah, and sweating through hard workouts at Crossfit XD.
Ready to learn more from David just head over to https://www.canovocapital.com/
And after that head on over to...
Who knows maybe you will be our next partner?
To get some neat (and FREE) Tools | Tips | Tricks to help you in REI!
SUMMARY KEYWORDS
investors, deals, business, market, multifamily, operators, syndication, utah, people, midwest, investing, real estate, built, cash flow, cashflow, small scale, sponsor, buy, equity, wanted
SPEAKERS
Billy, David
Billy 00:09
Welcome to unstoppable real estate investing wealth. My name is Billy Alvaro, aka the unstoppable BA, former billion dollar mortgage banker, gone bankrupt, turn professional real estate investor, where each week you'll learn the tools, strategies, systems and secrets myself and other highly successful real estate investing entrepreneurs used to start, grow and scale their businesses creating massive profits and how you can too, and we'll teach you how to put those profits to work. So you no longer have to get ready to finally experience financial freedom and generational wealth. Now let's get started. What is going on everybody? Welcome back to the episode of unstoppable REI wealth. I'm your host, the unstoppable BA and I'm here to teach you guys how to create wealth. And I'm doing that by bringing on people nationally from across the country who are starting growing and scaling their real estate investing businesses. And today there's no exception. Today I bring David Robinson from the great State of Utah, you guys in Utah crushing it you all salespeople that know how to close, David, welcome to the show.
David 01:17
Billy an honor to be on your show. Thanks for having me.
Billy 01:20
Absolutely, my man. So listen, let's do a little bit of a backstory first, just like what do you do? I know you're in Utah, but what's your forte? What do you do? And now what did you do? And now what are you transferring into
David 01:31
Yeah real estate is pretty much all I've ever known professionally. I was fired by my dad at the age of roughly 21 from his mechanical engineering firm. And that's when I knew I needed to take a more entrepreneurial path. And I immediately sought out to get my real estate license. I grew up in Phoenix made a move to to Utah, got my license here and immediately began starting growing a business knocking on doors pounding the pavement, ultimately built a short sale and foreclosure prevention business where we would help individuals leading up to and through the Great Recession to avoid foreclosure through the short sale process. And so we built a business around that model, heavily focused on that. And as the market started to shift, after the recession, I pivoted my business literally had to go back down to Ground Zero and moved into the traditional residential space. And, and then from there, I was never really a good real estate agent in the sense of a traditional residential real estate agent that wasn't my jam. So I focused on building up sales teams and managing a national franchise brokerage, got about a decade into the business and realized I hadn't done nearly enough as it relates to building my own wealth through investment property, and having any serious level of cashflow in my life. Yeah, and I had some, you know, sort of aha moments sort of life changing moments with medical issues in my family that really caused me to rethink where I was at and what I was doing. And, and that's when I shifted my entire business to focusing on investment property and small scale multifamily. So I have a brokerage business today that focuses on helping buy and hold investors who are looking to acquire small scale multifamily property for their own personal portfolios. By small scale, I'm referring to anything under roughly $5 million dollars all the way down to your typical four Plex and even duplex in some cases. And and then about two years ago, we got involved in acquiring larger commercial multifamily deals, structuring those as syndications so that members of my investor network could participate alongside us and those opportunities. So that's the that's a synopsis of my business.
Billy 03:57
All right the show's over you hit you hit all the high points. So let me ask you this now so you got you transferred over from brokerage night doing syndication? So what was your experience on getting started with the syndication? Were you going out there finding the deals and acting as the general partner? Are you participating as a limited part of talk to you?
David 04:19
Yeah great question. So just to clarify, I'm still an active broker. And that's my main business. The syndication business came almost out of necessity. So as I was building the brokerage business and focusing on serving clients who are looking to buy small scale multi, I realized after having dozens and dozens of investor calls and going through their goals and what they're trying to accomplish, that I large portion of my investor network, thought they wanted to own that four Plex, that eight Plex that 12 Plex, but when we dug into it, the reality was they didn't really want to own and have to deal with the challenges of personal ownership of the real estate, they just wanted the benefits of owning the real estate. Right? They were busy professional,
Billy 05:08
be passive is what they want it
David 05:11
They didn't know what that meant, at that point in time, you know, they thought, hey, I know I need to be in real estate, I'm making good money in my profession or with my small business. But I just assumed that that means buy a rental property. So many people are unfamiliar with the idea of passive investing what that looks like. And so that was really what it led to was me recognizing, okay, my investor network, a large percentage of them don't want to own the real estate, they just want the benefits and they want to invest passively. And they want to stay focused on their business and their profession. So that's when I set out to learn about this concept of passive investing. And I was exposed to the world of syndications. And so as just sort of a, you know, a natural byproduct of seeking these out, I realized that this could be a great opportunity for my investors who wanted a couple things. Number one, they wanted to be more passive. Number two, they actually wanted to diversify outside of Utah. So as a broker, all we really could sell them was property here in Utah. Well, there's a lot of great reasons to be buying real estate in Utah over the last handful of years. But cashflow wasn't one of those. And they wanted to participate in more cash flow. And so that was another reason. And then third was just diversification, you know, just getting outside of their local market. So I saw syndication as an opportunity to help them. And that's when I decided, Okay, I think I can add some value in this way. And my strategy was to go out, really spend a lot of time learning about syndication, educating my investors, and then finding high quality lead sponsors or operators, syndication operators, who are crushing it in their local space and market and then partnering with them on those deals.
Billy 07:00
So that's a unique way you're doing. It's your, in fact, you're not going out there and acting as the lead, right, as the general partner you're partnering up with, somebody already has the asset class. So what does that look like for you, then David, how are you coming in and participating? With your group? Tell us what that looks like?
David 07:18
Yeah, first and foremost, I invest in my deals as a limited partner. And I also am on the general partnership side of things. So I invest alongside my investors just as a limited partner doing the same thing they're doing. And at the same time, I'm also a part of the general partnership, which can consist of, you know, anywhere from two individuals, you know, up to maybe five, all bringing different pieces of value to the general partnership. And so for me, it meant my initial when I first got into it, there was a couple things that I was looking for. First and foremost, I chose to be in the Midwest, because my investors were wanting more cash flow than what I can provide them through small scale multi here in Utah. And the Midwest, there were some select Midwest markets that I believe were prime for providing better cash flow for them, or at least a better blend of both cash flow and appreciation. So I set out I identified a handful of markets that were interesting to me, then I realized the most important thing for me was finding a partner in that local market. So I set out to find operators who had a track record of success, ideally, at least 1000 units under their belt, who were on a growth trajectory, meaning they hadn't, you know, spent the last 10 years investing and building up a very sizable portfolio. And were sort of sitting back on their haunches enjoying what they had built. They were still aggressively out there looking for deals, I wanted someone that was out there getting after it. And number three, I wanted them to be local to their market. They had to be local to their market, at least on the first deal. There's plenty of syndicators out there that are buying outside of their local market. But for my first deal, I wanted someone that was going to give me a unique advantage because they knew the market, like the back of their hand, they were entrenched in that market, and had had had previous success. And then lastly, it was all about finding someone who was values aligned with me. And unfortunately, that just takes the most time. Yes, finding someone getting to know them understanding who they are at their core, how they're going to react to difficult situations, how they're going to communicate with my investors with me. And so that was a big part of the process. But I found a handful of operators that fit those criteria. And then one of those operators ultimately found a deal that was a match for what we were looking for. I flew out it was in Kansas City 164 unit C Class value add deal in Kansas City. I flew out, did my own due diligence on the asset toward comps toward the asset itself. Ultimately, I felt like it was a great deal after we underwrote it. And then we ended up partnering with that group and put that deal together for our investors.
Billy 10:14
It's amazing how you were able to first look at the amount of due diligence you're doing upfront, vetting your ultimate investors who have the cash, vetting, the ultimate operators who have the deals, and then going out and vetting the deal itself. If you're investing a lot of time, energy and money on making sure that your network is protected, like kudos to you on that, bro, a lot of people don't go to that level. So that's, I can just tell the value just by this conversation on what you do with your clients. Like you hold them at the absolute highest level, because you're doing things the right way to ensure that they're not going to lose
David 10:48
well, and I had my own money in it, right. And so I, you know, from a selfish standpoint, I wanted to make sure that I was investing something that I felt comfortable with. And a lot of my investors were trusting me to, you know, spend the time and energy and effort into vetting the deal and the sponsor. So yes,
Billy 11:05
let's dig in a little bit deeper. David, if we can, oh, and what was your process to go out? Identify good about the markets identify the operators in those markets? What was your process to do? So?
David 11:16
Yeah, so I had an advantage because I had started a podcast that was focused on multifamily investing that was serving my brokerage business. Well, what I started to do was feather in syndicators, operators in other parts of the country, and I would actually I had my markets identified. So I would reach out to, I would do research and I would identify lead sponsors syndication sponsors that were in the markets that I was interested in, I would have them come on the podcast, I would do an interview with them, give me a chance to sort of get a high level overview of their business, get to know them a little bit, you know, through a zoom call, or you know, a video call like this. And then if I felt like there was, you know, some some alignment in goals and strategy, then we would take it a step further, I'd get to know them generally fly out. So the sponsor that I ended up doing our first deal with, was someone that I had on the podcast over 18 months earlier, and then had spent 18 months getting to know the sponsor and operator, through zoom calls, through meeting in person through flying out to the market, et cetera, et cetera. So that that was the process that I went through. And I had that unique advantage of being able to interview sponsors, or at least have a reason for them to jump on a call with me, right? If you don't have the podcast, you can still do the same thing. It may just take a little bit more effort to be able to get on a call with those type of people are
Billy 12:42
Very strategic, extremely intentional, like well thought out well planned. I can see you're extremely calculated, right? You're playing chess, you're five steps ahead. Like you're planning and you're doing actions today, you know, you're going to reap the benefits 567 years from now I can see well, I
David 12:57
appreciate you saying that it may not be that calculated. But yeah, I tried to be intentional and, I had a plan in place. Now, it doesn't mean that the plan always went exactly the way I wanted it to are executed on the plan. But I definitely had a plan in place on how I wanted to serve my clients for sure. Love it.
Billy 13:14
Let's go do a rewind, let's go over to your core group of investors, right, the people who have the cash, what's your process to attract? Get to know and then retain bring these people in talk to the audience about that?
David 13:28
Yeah, so let's, I'll take it all the way back. So when I transitioned out of the traditional residential space, managing sales teams and a national franchise brokerage, I literally I didn't have investors in my database, or at least investors that identified themselves as investors and knew me as someone that could help them with their investing. So I had to rebuild that from scratch. And so it was a combination of a few things. Number one, it was rebranding everything that I was doing, and really honing in on a niche. So I could have just said, Hey, we're just an investment brokerage. Right? We could be doing commercial, we could be doing single family we could be doing. Turnkey single family, we could be doing short term rentals. There's so many different ways to go about it. This investing game. For me, I really wanted to narrow in on multifamily and even more particular, I actually started getting into the space just in multifamily in general, what I realized is that I needed to go even narrower to small scale multifamily to be able to connect with the right people that I was looking to serve and to connect with, which was private investors, not guys that were looking to put syndication deals together themselves. I wanted to be working with private investors, busy professionals, small business owners, individuals that have been bought rental property in the past, but they were looking to move up into the multifamily space. So that's what I set out to do and it was combination of digital marketing and rebranding. And so I, I have a background in the digital marketing space from, you know, my previous real estate businesses. And that's what I focused on Facebook ads, Instagram ads, Google PPC, and attracted people to my ecosystem through offers of value in return for their email address and contact info. Yeah, and those offers consisted of access to off market and pre market, multifamily deals, access to content that I had created educational content that would be interesting and helpful to them. And tools, like a return on equity calculator, where they could come in, they could download my tool, they can access it for free. And it would allow me an opportunity to connect with him, get to know them and build a relationship with them. So once they came into the ecosystem, then I had a roughly a five to seven step drip campaign that would get help them to get to know me what I was all about what I was trying to accomplish with the goal of getting on a phone call with them. Ultimately, that's what we did got on a phone call. And that's where the relationship starts.
Billy 16:08
Do you know Michael Blank?
David 16:09
Yeah. Familiar? Yeah, for sure.
Billy 16:11
I interviewed him about a month ago. And verbatim. I'm telling you, like, I don't know if you read his book, but verbatim the process that you just gave, is the exact process that he set up for himself X many years ago to start his syndication business and his trajectory of where he's at.
David 16:29
Yeah he's done an incredible job. He's, and this isn't, you know, this is just an overarching strategy across business. Yeah. give people something that they will want in return for their contact information. Once you have their contact information, then you foster a relationship, and ultimately try to get on a call to really solidify that relationship.
Billy 16:53
Fantastic. So now let's get over let's we did your investors, we did your your operators, let's get into the deals. Now. What do you look for in specific deals? And why specifically? Did you want the Midwest? Let's start with the Midwest first.
David 17:09
Yeah, so the Midwest was the initial entry point, what I realized is that the Midwest wasn't the only place to get cash flow and appreciation, I had it sort of in my mind that you had to go to the Midwest, to get cash flow. And then and when I analyzed those markets, that definitely held true. But what I realized is that a lot of these syndicators, were doing deals in the South, in the southeast, even in the Mountain West in certain markets, and still being able to get a good blend of both cash flow and appreciation. And the way that they were structuring their deals would allow a blend of cash flow and appreciation. And so once I did that first deal in Kansas City, the most important thing for me became the the operating partner that I was going to partner with. And so it wasn't just about the market, actually, above market became an operator. Because what I wanted to do was work with an operator that had a track record of success, that had local expertise. And that I felt comfortable and confident that they would do good deals that I would want to be in myself and my investors would want to be in. So we then decided, hey, we're better off instead of trying to consolidate around a specific market in in the Midwest, it's actually better for my investor network to diversify extreme diversity across geographic regions, geographic sub markets, across asset type, asset class, operator business plan. So my goal is to provide a variety of investment opportunities to my investor network, so that they can be highly diversified outside of what we're doing for them here in Utah. And so we've done a deal in Kansas City, we've done a deal here locally, we've done a deal in northeast Cleveland, Ohio, we've done a deal down in the south in Texas, we've done a deal out and out in Georgia, in Georgia, Savannah, Georgia. So my goal is to provide a variety of opportunities for my investors to diversify. But the number one criteria for me is Who am I partnering with. And what's their past record like and what's their experience? Like?
Billy 19:27
Yeah, because they're the guys who are going to be boosted around making sure that deals happening. I get that when you're looking in David into new markets to go into take the operator out for a second. What's your process to go in and analyze a new market to see if this is somewhere where you actually may want to invest if you have the right operator?
David 19:46
Yeah. There are really three main criteria population growth, job growth, low unemployment, unemployment. Okay. And if you can have incomes that are increasing great. So those those are the criteria they're looking for. And inward migration is critical. And, job growth is critical you want to be, here's the deal, you can invest. We did a deal in the Midwest, that was very stagnant when it comes to growth. And that's just fine. It's a great cash flowing market. It's a good cash flowing asset. But what I thought going in, was it cash flow was the play. Well, cash flows into play, cash flows, the play for people that already have built up a tremendous net worth. Yep. And there's some of my investors that that is their play. A lot of my investors are still in the growth stage, and no one gets rich off the cash flow. Cash flow is important. And we should be doing cash flow deals, cashflow positive deals, we wouldn't want to do negative cash flow deals. But I want the deals where we would have cash flow, and the potential for a big payout after three to five year hold, period. Yeah, we all can grow our wealth. And then once we get to that point, then we can use that wealth to spin off cashflow.
Billy 21:21
Yep. Smart. It's a smart strategy. This was great, man. I mean, you you you gave a lot of really good nuggets on what how you think and how you've connected with people. What's your play for the next five years, five to 10 years? What are you looking to do?
David 21:35
Rinse and repeat, continue to serve clients here and the Salt Lake City general market here. You know, helping clients buy and sell small scale multifamily here locally. And then also continuing to grow our syndication business, we were really surprised at the amount of interest that we have from our investor network, all of our deals oversubscribed, in you know, roughly 24 to 48 hours, many of our investors participating in those opportunities. And and so we see that as a part of our business as sort of an added value to our investor network to help them not only be buying stuff for their own personal portfolios here in Utah, but also getting beyond that. And so it's rinse and repeat, continue to do good deals with good people, and hopefully, make some good money along the way.
Billy 22:30
I love it. Dave, what is the name of your podcast? And how can people find you online?
David 22:35
Yeah, the podcast is the Lead Sponsor podcast, the lead sponsor podcast. So we interview Syndicate, syndicate leads syndicators, who have acquired at least $100 million worth of real estate. So that's our podcast, lead sponsor podcast, I've got a free tool for your listeners, if they want it. They can go to returnonequityreport.com A lot of you guys are active investors who have an investment property, I found that one of the biggest mistakes that my investors make is not tracking their return on equity. If they've bought anything in the last 10 years. They've built up a tremendous amount of equity in their property. And it's probably underperforming at this point. And so that tool will in five minutes help them calculate the equity the return that they're getting on the equity that trapped on their property. And lastly, they can check me out at canovocapital.com That's CANOVO capital.com. canovocapital.com
Billy 23:35
Dave, it's been awesome getting to know you for the last 25 minutes man you're a smart guy. Looking forward to watching you grow over the years if I can do you any service let me know. I'm here for your brother. Thank you so much for having a listeners tune in today for this. It was great.
David 23:48
Thanks, Bill. Appreciate it.
Billy 23:49
Absolutely bro Stayed tuned