From Engineer To Entrepreneur: The Small Business Owner's Leap | Paul Neal

Learn how taking a leap from engineer to entrepreneur has led to success in small business ownership and commercial real estate with Paul Neal.

Ever wonder if the leap from renting to owning commercial real estate could be the game-changer your small business needs? Paul Neal, seasoned entrepreneur and real estate savant, joins us to unravel the roadmap to entrepreneurship, wealth, and control. This episode isn't just about transactions; it's a masterclass in cultivating win-win scenarios, embracing resilience, and the strategic shifts that can transform your business from a tenant to a property-owning powerhouse.

Join us on a narrative journey through Paul's unique entrepreneurial path, from early dreams fueled by a natural knack for math and science to real-world business struggles and turning points. Through Paul's eyes, we'll uncover the trials and tribulations of sales aversion, the crushing impact of market crashes, and the phoenix-like rise to new opportunities. Discover how the right mindset, vision, and mentorship can be your compass through the tumultuous seas of business ownership, steering you toward tangible assets and an exit strategy that secures your legacy.

This conversation is more than inspiration; it's a treasure trove of practical wisdom for service business owners in HVAC, plumbing, dentistry, law, and beyond. Learn why sinking your roots into commercial property can shield you from market volatility, amplify your operational efficiency, and cement your financial freedom. Close the loop on your entrepreneurial vision, forge unshakeable confidence in sales, and craft a business that not only thrives independently but stands as a testament to your hard-earned success.

Paul Neal: Vantage Point Commercial Capital

Company Website: https://vpc.capital/

Personal Website: https://paulneal.net/

FREE Book (+shipping): https://www.ownyourbuildingnow.com/2

Podcast: The Brick & Mortar Money Show
Apple: https://podcasts.apple.com/ph/podcast/the-brick-mortar-money-show/id1642595491
Spotify: https://open.spotify.com/show/05AlVzdk7S8Dst5YnmfVBz

LinkedIn: https://www.linkedin.com/in/paul-neal-tea/

BOSS Links:
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Chapters

• 0:00 Small Business Ownership Simplified for Success
• 3:34 Journey to Entrepreneurship
• 7:18 Overcoming Challenges in Business
• 17:10 Navigating Business Setbacks and Pivots
• 26:07 Entrepreneurial Resilience and Business Ownership
• 34:28 Benefits of Owning Commercial Real Estate
• 47:03 Business Clarity and Vision for Success
• 50:57 Becoming a Successful Small Business Owner

Transcript

Speaker 1: 0:00

when you're confident and you believe in what you're doing and you believe that you can represent it well. Sales is easy, right, and I think what he learned, and what I've learned since, is that we're really not selling, we're just presenting an opportunity for somebody and if it's a fit, great. If it's not a fit, great, because it needs to be win-win.

Speaker 2: 0:21

Welcome to Small Business Pivots, a podcast designed for small business owners. I'm your host, michael Morrison, a small business coach and founder of BOSS, where we make business ownership simplified for success, so that you can create a business that runs without you. To learn more, go to businessownershipsimplifiedcom ownership simplifiedcom and be sure to hang out to the end of this episode for my recap and coach's corner, where I challenge you with one thing to take action on that will move the needle in your business before our next episode. Our guest today is Paul Neal. Paul is the owner of Vantage Point Commercial Capital and a trailblazer in empowering business owners to create wealth, autonomy and control by owning their own commercial space. He's not just an expert in commercial real estate. Paul is a master at making complex topics accessible and engaging. Having owned multiple entities through the years, paul offers an abundance of takeaways that any business owner can implement today to see significant growth in their future. His new book, unleash your Business, unlock Wealth, autonomy and Control by Buying your Building and Firing your Landlord delves into this transformative approach to commercial property ownership.

Speaker 2: 1:38

As our podcast guest today, paul brings a unique blend of expertise, wit and conversational warmth. He has a knack for breaking down intricate financial concepts into enjoyable and digestible discussions, making every interview not only informative but also genuinely entertaining. His stories and insights offer practical wisdom that resonates with anyone aspiring to achieve greater success in their business ventures, with anyone aspiring to achieve greater success in their business ventures. Let's get to Paul now to learn the pivots and mistakes he made while building substantial wealth so you can do the same. All right, welcome to another Small Business Pivots. We have a special guest from around the world and I have found that no one can say their name or business like the founder. So tell us your name, your business, a little bit about what you do and we'll get going.

Speaker 1: 2:27

Yeah, michael, absolutely Glad to be here. Paul Neal, I'm a serial entrepreneur. Our business right now. I've always been in and around the real estate finance world and where we focus right now is helping business owners small business owners that have a local presence, whether it's for employees, patients, customers, clients or whatnot that's growing who are leasing their commercial space. We show them and help them how to buy that space so they can become a full owner not just an owner of a business and a renter of a space, but an owner and an owner, a full owner, not just an owner of a business and a renter of a space, but an owner and an owner. Because I found that most business owners that's really what they're seeking right Is is they want to be the owner. They want to, they want to be in control, and so there's a ton of advantages there, a ton of misconceptions there, and so we just focus on educating the business owners and helping the ones that that it makes sense for take those steps.

Speaker 2: 3:22

Fantastic. So well, let's get started. So we were talking earlier. You've owned businesses since the 80s, so I'm sure we have some golden tips for all of our listeners today. In your upbringing, what kind of led you to the entrepreneurship world?

Speaker 1: 3:39

Yeah, that's a funny question because I don't really come from a family of entrepreneurs. Perhaps me and my brother are sort of the first in the family, the first of four. My parents sort of led the traditional life. My dad went to school, got an engineering degree, worked in engineering and took a job for the federal government as a civilian engineer and took a job for the federal government as a civilian engineer, and my mom was a stay-at-home mom until we were later in school.

Speaker 1: 4:12

Then she went off and got a nursing education and I think the thing that drove me to want to go into business was I always had big dreams. Basically, you know, I thought I was pretty good at math and science and so I went into engineering as well. That's what I studied and it came pretty easy to me and I always thought that I was going to invent something because I just I always had these dreams and I know it seems kind of crazy and I have a lot more depth in my life than this, but back then it was like, hey, I just want to be rich, yeah.

Speaker 2: 4:43

That's all we did, right? Yeah, there wasn't technology to play with. You had to do something with your life.

Speaker 1: 4:50

Yeah, yeah. But I remember this distinct that you don't have too many memories from my childhood now, back in, you know, 50, 50, some years ago. But my, I remember my dad asked me one time we're standing in their bathroom and looking in the mirror I must have been eight or nine or something and he said so what do you want to do when you grow up? And I just looked at him in the mirror and said I want to be rich. And smiled, you know, and he smiled too, just kind of nodded his head and all that. And you know, and we came from.

Speaker 1: 5:20

I had a decent lifestyle. You know, my family was by no means rich and a solid middle class family, but you know, one income, four kids and all that and but. But I had a friend down the street and this may have been where it came from, that that always he was, he was only two kids and the both mom and dad were had a little extra spendable money, and so when we would always go to the movies or do something, his mom would slip like a $10 bill in his pocket, and then she would always slip some money in my pocket too and I'm like, wow, this is great. So I really think it kind of stemmed from that. It's like, wow, you could have more, you could be more and do more, and I think that's where kind of the seeds came from.

Speaker 2: 6:06

So you went to college for engineering and got out, and what happened?

Speaker 1: 6:12

Yeah, so mine's interesting story. I studied electrical engineering and our school had an amazing program called the co-op program, and so the co-op program really educated me early, where essentially you're in school for a few semesters and then you go work for a company, like you know, as a full time employee in engineering, and basically you're like an intern but you're paid, and so you get to learn in different experiences, and I had some really good ones, but I also had some eye opening ones. And I remember sitting in a there's this boardroom excuse me, it wasn't a boardroom, it was like a little office, you know, like a, like a small conference room, maybe 10 by 12. There were six or seven of us in there and this particular company made these, these network test boxes, when the network, the internet, was just kind of starting to come around, and they were very custom, they were expensive, like $80,000 for a box, custom built, and they were arguing for a couple of hours about the color of the little rubber booties that went on the box, right, and I'm like, really, this is what we're going to, this is what I'm going to do for my, you know, for the rest of my life.

Speaker 1: 7:18

Yeah, and so I just it didn't, it didn't mesh with my, my internal drive that said, hey, I wanted more and I wanted to be free, and I couldn't sit in this fluorescent light 10 by 12 room and have these meaningless arguments. And so it taught me a lot and so, fortunately, sort of during that same time, I saw my sister go into business with her husband at the time and they started having some success. They were in the Research Triangle Park area of North Carolina and again it got my attention and through a series of events we were able to actually start working in business with them, kind of as a junior partner for a little while, and then became our own partner. And so that was, and at that point it was like, wow, we're doing better here with this little marketing business and distribution business than I would have made as an engineer anyway. And so I'm, like you know, bye, bye engineering, it's not what I wanted to be. I still like math, but you know you don't want to argue about colors.

Speaker 1: 8:24

I don't want to argue about things that just seemed like to me, you know I mean I've never been a major in the minor kind of a guy and it seemed like you had to really do that. That, on top of the fact that I started working when I was young, I was a lifeguard at the local community pool and even before that I worked in the snack bar. I think I was like 14 and I just didn't like people telling me what to do, even at that age.

Speaker 2: 8:46

Well, I, I know that some people like well, what does the journey or the story? Why is that so relevant? And it's well, because that's how we connect as business owners. We all have a story and for some reason, a lot of us business owners were like was my life worse than his or hers? Maybe that's why they're so successful? And it's like no, we all have a journey and a story, but it's how we overcome those. And so you got out, you stepped out. What was your first business?

Speaker 1: 9:14

Believe it or not, it was a network marketing business and they had my. I saw my sister get in it and kind of do really well, but I poo-pooed on it for the first couple of years I'm like, nah, I don't want to do that. But then, as I saw them succeed in the business and the opportunity and then they introduced us to some of the people, like okay, well, maybe, maybe this is more of a legitimate business than I thought. And so so I say we, because my, my then girlfriend, who then has since been my wife for 30 some years, got involved with them and had a pretty good amount of success early on. So that was fun.

Speaker 1: 9:51

In that business we learned a lot about setting goals and dreaming and working really hard and getting a lot of no's and really getting battle-tested and getting out of our comfort zone. Because me in particular was not an outgoing kind of a person I didn't really want to, you know, work in sales, or do I just wanted to be rich? You know, again, I was going to vent my way there. So it really forced me to do some things that I didn't think I could do and didn't want to do. And then I looked back and found out that, a it wasn't so bad and B I was pretty good at it actually.

Speaker 2: 10:28

So what would be some tips that you learned to overcome that challenge of not wanting to sell? Because I know a lot of small business owners. That's the one thing they hate.

Speaker 1: 10:38

Yeah Well, I mean, there's a lot of them, but the first thing I think of is your why, right? I mean, simon Sinek says it's the why, what motivates you and the reason, the only reason I did it was because I again had these dreams and goals that I wanted to pursue and I realized that the only way I was going to get there was to sell, to go out and grow my business and get out of the comfort zone. I think I think part of it to a tip would be if you can learn your lines. You know, I heard someone say a long time ago that who started in sales in a different field has since become a friend. He said the reason why he became so successful and he was like a top producer in his field by far was he. He figured out, he learned all of the objections that people were going to come up with and all the you know all the sort of arguments pretty fast and he spent time cultivating, you know, possible responses. Okay Well, how do I, how do I, you know, answer that, how do I deal with that? And got comfortable with that. And then he, as he learned those, you know, sort of all the worst case answers you know that you're going to get. Then he wasn't as apprehensive or afraid to go into those conversations with people because he knew his lines. He knew there pretty much wasn't anything that they were going to say that was going to throw him off, and so he was a lot more comfortable and as a result of being more comfortable in sort of the possibilities, many times they didn't even come up, because now he's comfortable, he's confident, and when you're confident and you believe in what you're doing and you believe that you can represent it well, sales is easy, right. And I think what he learned, and what I've learned since, is that we're really not selling, we're just presenting an opportunity for somebody and if it's a fit, great. If it's not a fit, great, because it needs to be win-win Business people.

Speaker 1: 12:37

The last thing you want to do is develop a big client base of people that you don't want to work with, right, or that you don't want to work with Right, yeah, right, yeah. Or that you're forcing into what you're trying to sell. Or you know you're twisting people's arms or you know, and so, and that's really not what you're doing, it's just your, your. Somebody says you're, you're just turning over stones, right, you're looking to see. Okay, you know there's, there's a diamond here somewhere, and eventually you'll find it. But you know, you don't know which stone it's going to be under. You just go through the process and you know. And so that helped me a lot to realize, hey, there's only a few objections I'm going to get, and I can learn to deal with that and then be intelligent about it and say, okay, why? And try to go a little deeper, why are they responding that way? And it just raises your confidence.

Speaker 2: 13:27

Yeah, as a business coach myself, I kind of like to throw a nugget in there, or piggyback on top of something that I hear business owners really need to relate to or hear again. And one of the things you said was to the effect that you don't want to work with everybody because not everybody's going to be a fit for you. And I have a past client this is a perfect example. That came to me a big, big, big opportunity for one of their prospects. But after three weeks and all the missed phone calls, the missed meetings, the meetings that they were there an hour and a half late saying, hey, I'm on my way, 30 minutes later still not there.

Speaker 2: 14:04

Well, we didn't know. They were driving an hour and a half away. You know, on your way it sounds like I'm almost there, but anyways, and they were real disappointed, they kept working this. I said this is the, this is what you're going to be working with after they start paying you two times 10, because now they're paying you to be there. I'm like so that's, that's, that is a more. That is a huge lesson for business owners is you don't have to work with everybody and just because the money's there doesn't mean you're going to be happy when you start working with them. So kind of, use that internal gut that you know not everybody's a fit, know when to walk away.

Speaker 1: 14:42

Yeah, yeah, for sure. I mean, I think we're all sort of given you know I'm a faithful guy, I really believe that we're all sort of given our own mission field right of people to serve, and so we're not really competing with each other.

Speaker 1: 14:55

We're really just trying to serve the best in our field, and not everybody is a fit. You know, and I've learned too, that I'd rather get a fast no than a long, maybe, right? Yes, too, that I'd rather get a fast no than a long, maybe, right, yes, let's just deal with this man, yes or no. And a lot of times, as you just indicated, it's the signals that they're throwing out as well. It's not necessarily the words they're using, but the signals when they're showing up late or they're not returning your phone calls. There's one thing about being persistent, sure, but there's also a line about being.

Speaker 1: 15:28

You know and I see business owners do this and I would imagine, as a coach, you really see it and I have done this where you fool yourself into thinking you've got something you don't have From a sales pipeline. Well, I've got this full pipeline of all these potential buyers, but at the end of the day, do you really Maybe 20% of them or 30% of them are ultimately going to be buyers and the rest are just distractions and sort of feel good for you? That, okay, I think I've got a good business, but it's preventing you from doing the thing you need to be doing right To get more of the 20 to 30% that are actually going to buy. And so we you know other people can fool us about 50 more of the 20 to 30 percent they're actually going to buy.

Speaker 2: 16:11

And so we, we you know other people can fool us about 50 percent of the time, but we can fool ourselves 100 percent of the time. Oh for sure, for sure. I always say get to the know fast. You know, get to the know fast, because most people I found they can't that. You know, people are still human, they're empathetic. Most people can't tell. You know, people are still human, they're empathetic. Most people can't tell you no. Yeah, that's why they always say I'll think about it, maybe, maybe next quarter, you know, but for some reason they can't say no. So take that as your no, or say does that mean no? Then it's okay to say no. So I love that. So those are good sales tips. So here you, you poo-pooed your first little project and you kind of got dabbled in some other areas. Tell us about those adventures and some of the pivots you learned that got you where you are today. And then I want to talk about what you do, because you, you're a wealth of information.

Speaker 1: 17:01

So let's start with some of your other pivots some of your other pivots.

Speaker 1: 17:10

Yeah, so I have some pivots. So you know in this relationship that my first business you know, my wife and I were involved for quite some time, for a number of years, and, like I said, we had some pretty good success out of the gate. But over a period of time we ran into a situation where we started kind of butting heads with my sister and brother in law and some other things that were going on. We kind of felt like we hit sort of a glass ceiling. Now, whether that's true or not, you know, could be debated, but where we were in our head at that point we felt like, okay, we could go to another level and we need to be thinking about what can we do? We've learned all these skills. You know, we've experienced a lot. We've learned a lot about dealing with people and ourselves and so kind of in this period of time where we're searching, one of my good friends had gotten into the residential real estate business, the finance side, the mortgage business, basically back in the back in the 90s he was, he was doing really well and he really liked it.

Speaker 1: 18:08

And about the same time my wife and I went out and bought our first house and the experience that we had on buying the home the financing was really wasn't that good, to be honest with you. There was a lot of surprises. We didn't know what to expect. It just wasn't a great experience. And so I sort of connected the dots and thought, well, here's a friend that's doing this well and I love math and numbers are my thing, and I bet I could do this better.

Speaker 1: 18:40

And so the long story short was, as an entrepreneur, I didn't know anything about the business, I just knew math and I had my other business going. It was producing a pretty good income consistently and I could kind of I was almost phoning it in at that point in time. So I had some flexibility in my schedule and I thought, well, what's the best way to learn this business? So I opened up the newspaper when we used to have those when I was living in Raleigh, north Carolina, and found a local mortgage company that was hiring people, and so I said, okay, well, maybe I'll just see if I can get a local job during the day, because I've got time and flexibility and I can learn. And so, long story short, I did got a job and within about two months I was the top producer because of the skills I had already learned on dealing with people. And I was working with other people that were in sales, that were afraid to pick up the phone, and I was like, oh, I've crossed that bridge a long time ago.

Speaker 1: 19:39

So I learned it. And then I learned the business and everything. And so I said, well, gosh, if I can do this, now it's time to pivot and do my own thing. And so I got my own license, started my own business, and so from there we started our own residential lending company, moved to Virginia at the same time and spun that up and did really well and had some secondary businesses from that, had a title company and had a few other things and was going really well and growing by gangbusters and had more, expanding into multiple offices and hired, had a bunch of employees I think we were probably I don't know 50 employees over over time. And so you talk about pivot. So in this period of time, we said goodbye to the first business completely and really kind of focused on this one, and again it went really well.

Speaker 1: 20:34

Well, you remember 2007 and 2008,. Of course, right, the Great Recession. Well, we knew that the market was going to change. In fact, it had gotten really bad around 2004 because we couldn't give good service anymore because so many people were getting in the business. Everybody was like all the service-related industries, like the insurance people, the title people, the appraisers were all just taxed beyond their capability, and so it was just becoming bad.

Speaker 1: 21:03

Well, didn't do well through that transition. Basically, we had been funding a lot of our own loans and fortunately, we stopped doing that about six months before the market crashed, and so it was good. So, basically, I went from a business that I was positioning to sell because it was very profitable and we had a really good brand in our local area in Virginia, to a business that we had customers for, but all of our funding sources completely disappeared overnight. I mean, there was nothing there, and so we couldn't lend any money. And so what do you do when you have a staff of overhead, you've got offices, you've got space, you've got all that. So we had to make some hard decisions and make some cuts and things. And that was the first experience in my life from business. Every business had been, you know, success, success, success and sort of on the way up, and that was the first time that that we suffered a setback. And that's a. That's a. You know, we'll just being nice, so we call it a setback.

Speaker 1: 22:04

It was going from a very high income in a business worth a lot of money to a negative income, because now we're paying people, I think our overhead was like $40,000 a month just for employees and you got zero revenue coming in. It doesn't take long to start doing the math, to figure out okay, now we're dipping into savings and how long is this going to go? So we ended up shutting the business down, didn't have to go bankrupt or anything like that. We were very blessed but, um, but we did have to figure out okay, what are we going to do with our life at this point? And um, and so through some of the connections I'd set up, um and just friends I'd developed, um, I put the word out that, hey, I'm, I'm, i'm'm available.

Speaker 1: 22:48

I'm not sure what I'm going to do. So a friend, through an organization I was part of at the time called C12, and still am actually he reached out and said, hey, he had a company, he was growing in the technology space and needed somebody to help with marketing. And I'm like, okay, well, hey, I studied technology and I know math and I know marketing, so why not? So I'll, I'll team up with him and actually go to work for him as an employee, which was the hardest thing I've ever done, because it was like I'm in my mind, I'm admitting failure, right, I'm like I haven't worked for somebody and here I am doing doing what A job. And yeah, yeah, and, and not only that, I was having to drive like an hour to get there. And I'm like, oh my gosh, this is like to me, it's like the antithesis of everything that I had, you know, believed in and and pursued and and and went after. And it was.

Speaker 1: 23:45

It was a rough time, I'll be honest with you, but a funny thing happens. So, you know, my wife and I are very faithful, as I said, and we try to maintain our faith and we're always looking for okay, what's the opportunity here? Right, we're not going to stay down forever. And so my friend and I came up with a business idea to basically spin off a little piece of the business that he was doing that we could build and grow and I could be part of that and be part owner and run it and grow it, and we could use a lot of this similar customer base and so forth. And so, anyway, we ended up doing that and, over the course of a few years, built a, built a company, and then we're able to spin that off and sell it.

Speaker 1: 24:30

And so it went from, you know, we went to to the. You know when I say the pit of hell and to to now we're. Now we're cranking again Right and um and and and so so, so the back to your pivot story. It's like everything that you thought that you, you know, you'd put your time, sweat, blood, tears in and hope into, is just eviscerated literally overnight. And it wasn't. You know, everyone knew there were things were going to slow down, but it was cataclysmic, it wasn't a slowdown, and so you really got to dig deep at that point. And that's what we did and, realizing that this too will pass, we don't know the answer on how it's going to turn out. But we always bounce. We're going to win, we're going to figure out a way and eventually and it took longer than I hoped for, it took a few years to kind of position in there, but eventually we did.

Speaker 2: 25:25

You're listening to Small Business Pivots. This podcast is sponsored by BOSS, where business ownership is simplified for success. Boss helps business owners create a business that runs without them, with business consulting from business coaches who have actually owned businesses before, and business loans in as little as 24 to 48 hours, online courses, workbooks, classes and much, much more. Go to businessownershipsimplifiedcom to learn why small business success starts with Boss. If you're enjoying the podcast and want to stay up to date with all of our episodes, make sure to hit that subscribe button, give us a thumbs up or leave a positive review. Now let's get back to our guest. That's a great story and I appreciate you sharing that, because I know a lot of business owners go through those things. But when they look at other business owners, like when you were at the top of the peak they're like, oh, he's got it made. Why is everything going right for him? And they don't. You know they don't realize you still have a story too. You know that you're going through. We just don't publicly announce it until we're on a podcast. So we're trying to help other people. So I really want business owners to hear they're not doing anything wrong. We all go through challenges. There's pivots, there's ebbs, there's flows.

Speaker 2: 26:43

I filed a bankruptcy before due to a cancerous partnership and had to rebound. You know I've been in that low place and one of the best advice is so. I know I'm a business coach, our company has business coaches, but I hire my own coaches as well. And he told me at that time he's. And I didn't have any doubt. I was like you, I was like this too will pass, something's going to turn around. Just keep going. But he told me he said I have no doubt you're going to make it. And I said why would you say that? And he said well, just in case there's a little bit of doubt in your head, he said I have no doubt you'll rebound, and rebound 10 times better than you were. And I asked him why he said that. And he said well, because now you know what to do and what not to do. Now go do those things you know to do again and you'll do them better. So I'll never forget that.

Speaker 2: 27:38

I'm like you're right, there are things that I do know that someone just starting a business or that has a job, they don't know those things. So it's all that grit, that experience, and I think there's something about entrepreneurs. It's kind of like, once you get that first patch, you know that arm patch of being an entrepreneur. I can relate to your story because when I had to file bankruptcy, my wife even said you're not going to get a job, are you? And I was like, well, I've been an entrepreneur for 22 decades. You know, no, I'm not, you know I'm not, anyway, so I know. It's just that humbling experience. You feel like you lose your freedom. You know everything about you, your manly hood or whatever. You know it's, it's tough.

Speaker 1: 28:30

Well, yeah, no, that's it, You're right. It really challenges the core of your what your self image is and how you, how you think about yourself.

Speaker 2: 28:37

Yeah, so moving along to where you are today, you have a unique business that really helps business owners. So let's talk about that so that we can get to the meat of how you help and serve other people.

Speaker 1: 28:52

During this whole process of that last company, that technology company that we built and sold, I kept having this yearning and desire to go back into real estate finance. But I wasn't really interested in residential real estate finance. I wanted to go into commercial because all of my contacts and friends were business owners and entrepreneurs and all the roundtables I've been on and associations I just know you know what we all sort of go through is kind of my tribe and you know I can't tell you how many of them and I'm sure you see them as a coach. You know they develop these businesses that end up spending off really good cash and what typically happens is the business owner will raise their lifestyle to the level of their income. Right, and so, yes, they have a good lifestyle and many times better than most, but they're not really building something that they can, that, that, that that's a tangible asset, long-term right Now. Some of the really sophisticated ones do and the ones that really learn how to build systems and people and work on the product of the business and that and that's achievable for anybody. But it's a process, right, it takes time, it takes a lot of learning. I mean you can read a book about it. That's one thing. But your point you definitely need a coach. You know I've had coaches, many coaches, over my years too, because you need that third party kind of looking around the corner. Even today I do it. We have a round table and it's, you know, once a month, and an individual coaching where it's like, hey, here's what's going on, here are my challenges. And then you get perspectives from other people that have gone through it and maybe different industries, but have been there. But outside of that, building a business that has systems even with that, at some point you have an exit strategy, right, that's either you're going to retire and just stop doing it, you're going to pass your business on, hopefully to, maybe to a family member, maybe you want to sell your business as an option. These are all great options and the thing is that when you build a business, depending on how it's structured, the value is going to vary pretty widely.

Speaker 1: 31:24

No-transcript. There's real estate involved with it. I've seen others that that, sadly, had worked. You know, 30 years in business had a good income. In fact, my wife was telling me about one just the other day that she she a new, a new friend she ran into 30 years, some kind of a consulting business, and they rented their space the entire time and they're closing their business. Well, if they had bought the bid, he was swearing off the fact that he should have bought the building, because if he did that, 30 years is going to pass, 20 years is going to pass either way, and you're either going to pay rent to someone and have nothing left over or you're going to have a tangible asset that you can then sell, or you can rent out to someone else.

Speaker 1: 32:08

One of my friends and clients, kathy O. She's an OBGYN. She bought her building about 12, 13 years ago because her husband, jim, was kind of pushing her into it and she's since paid the building off. She was going to have her medical practice in the building either way. Well, a couple of years ago one of these larger medical groups came in and they buy up to smaller practices. So she's like, yes, I want to sell because I want to retire here in the next three, four, five years. So she sold them her practice, negotiated to be able to stay there and work up to the next five years, kind of on her own terms. So she gets a salary she got to pay out. And oh, by the way, since all their patients and the practice is coming to that building, that location. This group is now paying her rent for the building. So she's got a like 10,000 plus dollar a month stream of income coming in on the building, whether she ever shows up and does another pap smear or not.

Speaker 1: 33:03

Right, and she, and at the end of the day, she's got choices. She could, just she can. When she retires, she can continue to let them rent it. She could sell them the building. She could. She could sell it to someone else, um, you know, you could take it in 1031 into some other real estate, um, and so there's a lot of options.

Speaker 1: 33:22

So so I would see these different groups of business owners, michael, that had a lot because they made that choice early on, versus the ones that didn't have nearly the choice, thinking they're going to sell a business you know for a ton of money and it's just a business with a customer base and you know, and you might even be the only one you know is the magic in the thing which is not worth a whole lot.

Speaker 1: 33:45

So I was inspired and so that's really our focus is helping business owners, entrepreneurs, who are in a position to do it, and not everybody is.

Speaker 1: 33:55

I mean, if it's a startup or you're kind of struggling to make profit and kind of get your sea legs and it's not, doesn't make the right, it doesn't make sense. You got to get that squared away. But but if you've got a business and it's succeeding and it's profitable and you need a local presence for some reason, again you've got customers that are visiting employees, patients. People have to come. It's not a virtual business where you can run anywhere around the world and you've got a growth curve. You think, yeah, you're going to be around five, six, seven, 10 years from now because of your plan. And so many of them are service businesses like HVAC, plumbing companies, contractors, lawn care. We deal with a lot of professionals like dentists, doctors, chiropractors, cpas, lawyers, that want to buy their building right because they're building a practice locally, and so we help them do it. We educate them and show them the benefits and what they're losing if they.

Speaker 2: 34:52

That's golden, because I have worked with a lot of business owners over my years of coaching and all of those who owned a business. Their business was worth more than their business. The building itself was worth more than the business, and so for a lot of them, like the contractors you talk about and stuff I hate to burst anyone's bubble, but if you're the owner and you're still working as the plumber or the electrician, your business is not going to be worth anything when you're ready to get rid of it. Unfortunately, because you are the business, you know, you're the brains, and so even if they were to buy that book, a list, it's still not really worth anything because it's usually a relationship with the business owner. So this is good information because, like I said, the business owners that actually owned their buildings or a building or two or three, how many ever they came out way further ahead in retirement than the ones that just struggled throughout life.

Speaker 1: 35:54

Yeah, yeah, no, I mean it's a four. In one sense it's a forced retirement program because you're you know you're forced to make the payment, like you're forced to make your lease payment, but but it's coming part of that's going into your equity bucket for the future. Yeah, you know, and not too much different from your personal residence. I mean, why do you buy your own home versus rent? Most people buy because by the time they retire they want a paid off home and then you know you can live there without a mortgage or you could do a. You know they're doing reverse mortgages now where it can be a retirement stream for people. A lot of people are doing that, but it's generally the biggest asset that people have is their personal home. So to your point of if you have a business, what you've seen anecdotally is that it's generally the biggest asset that these businesses have too after a period of time. Right, is that building, and so if you forego that opportunity, then you forego this huge benefit, not to mention all the other things along the way the tax advantages of having the building where you can defer some of the income, the equity appreciation. You know, because we know real estate goes up in time over. Value, you know, goes in value over time, not in a straight line and it can be in short term it can go down. But generally if you look back 10, 15, 20, 30 years, you know my parents bought their first house, you know, for $30,000. And you know, in the 70s or 69. Same house today is $600,000. It's an inflation hedge, if anything.

Speaker 1: 37:23

What a lot of our clients do is they'll buy or build a space a little bit larger than they need and they'll lease part of it out. Then the tenant will pay part of the freight so they actually can get in the building for less monthly expense than leasing. They don't have to worry about, you know, rent escalations in their lease. They don't have to worry about lease non-renewals when it comes up and the landlord says I think I've got a better use for my building now. You know Amazon wants to put in a storage center here or distribution center and so we're going to sell them land, which you know.

Speaker 1: 37:57

If you've got a business that's just an office business and your employees probably not that big of a deal you can relocate. But if you have a location that may be retail related, like a restaurant, and all your customers are right there within a couple of miles, or even a dentist or a doctor, and they're right there. People don't want to drive across town to go to their dentist or to their pizza place, right, I mean, there's a pizza place on every couple of corners. So those are things operational control and limitations. And what about even building a space out that suits a better process, so you can be more efficient?

Speaker 1: 38:30

Steve is one of my clients. He's a commercial builder, but one of his side hustles was he had 50, 50 ownership in a cabinet company. Um, and well, the he let the other guy run it and he was just kind of a silent partner. Well, the other guy decided he wanted to sell and so Steve said hey, I'll, I'll buy you out. And so he bought them out and he brought in a manager who was someone who was really trained in like six sigma and you know these, you know high-end process and how to be really efficient. Anyway, he, together they retooled the, the building. They had to rip out some walls and and renovate it and they brought in a new piece of machinery. And they could do that without asking for permission, because steve owned the building.

Speaker 1: 39:14

Yeah, right and uh, because if you go to your landlord and ask them to do that. They might allow it. They might not allow it. If they do allow it, you're going to pay for it. And so now you're improving someone else's space and you're like, well, they'll just put it into the lease. Okay, yeah, but then you're paying for it because your lease rate's going to go up or you're going to lock you in for a longer time or whatnot. So they literally, at the end of this, with this pretty much the same staff were able to almost double their output in the same location with about the same staff, just because they were able to reconfigure things and bring someone in that understood process. So there's a lot of advantages to it. You know opportunity costs. You could look at it if you're not doing it. And so then you got to ask. The question which you're probably going to ask I'll throw it out there is why don't people do it more Fair?

Speaker 2: 40:02

question. You read my mind sir.

Speaker 1: 40:06

Yeah, I mean, it's just. You know there's a lot of misconceptions out there about it. I think a lot of business owners are, you know, and you, as a coach, can validate this more than me but I would say most of them are heads down working in their business instead of working on the business, right, yep? So they're operationally involved, they're focused day to day, they're putting out fires, they're trying to grow, they're paying the bill, they're doing all these things, and so they don't even think about it, right? I mean, they, they, they get a lease renewal email or a phone call from the realtor or the landlord says, hey, your lease is up for renewal in 30 days. Okay, well, 30 days is way too short of a timeline to be thinking about buying a building, right? So I think that's one reason.

Speaker 1: 40:53

I think another reason is a misconception is a lot of people think it takes a large down payment. You know, commercial space is generally more expensive than residential and if you saunter down to your local banker, he'll tell you in most cases you need 20, 25% down. And so if you're going to buy a $500,000 building or a million dollar building, you know you're looking at, you know $100,000 to $200,000 down and it's a lot of money and you may have it, but you may not want to take it out of your operating account, you know, for your cash flow and your working capital, and just put it into bricks and mortar and bury it in the dirt. Basically so, but the reality is it doesn't take that. You know. You can get into a commercial space if you're going to move your business in and operate your business there for 0% down, typically 0% down, typically 0 to 10. We like to say 10% in most cases, but we can go 5 or 0, just depending on the case, if the business is really cash flowing.

Speaker 2: 41:45

So there are options out there that people don't realize what's that term. Is it owner-occupied?

Speaker 1: 41:52

Yeah, owner-occupied commercial space. So everybody sort of understands it in residential that I'm going to live in it, right, as an owner Similar to commercial, your business is going to live in it. So if your business lives in 50% of the building, if it's an existing business, then it's considered owner-occupied. If you're building a new building to suit, as we people do, then it needs to be 60 percent, um, so, which means you could lease out the other other space. Yeah, the other thing that well, the other thing about that too is, just as you, before you move on, is that, like you talked about maybe owning multiple buildings. Well, let's say you listen to michael and you scale the business up and you got systems and people and you're able to grow it and you're maybe not all in your business now, but you're more on your business and you want to expand into a different location. Well, you can buy a second building across town as an owner-occupied building. You can be in two owner-occupied buildings or three or four, as long as your business is primarily the one operating at least 50% of the space.

Speaker 1: 42:58

So I have a dentist that he did that. He came out of dental school with this idea that he wanted to build a dental business. He didn't really want to pull teeth and fill holes, so, smart guy. And so after a few years he had a profitable business. So he bought the building. But his goal was really to buy to, to buy multiple buildings and then hire um dental graduates and put them as employees to run his dental practice. And so he's got, I think, five buildings now over about 10 years, and so he's got a massive real estate business in addition to the dental business. Yeah Right, and his dental businesses pay rent to his real estate business which he owns, and the real estate company depreciates all that. You know, the building offsets the income, the rental income, and it's just a beautiful thing for him.

Speaker 2: 43:45

Fresh graduates out of school to actually do the work, if you will. Now he has his license, you know, as a chiropractor, but he didn't want to be a chiropractor, so it sounds like it's kind of the same story, which is smart, you know. At least you know what you're providing, the service or level of service that you should be providing in that industry, but you're not actually doing it. So that's a great story. Well, you have so much more information to share. What's the best way people can follow you, connect with you? Is there something you want to offer to the listeners to go check out?

Speaker 1: 44:27

Yeah, yeah for sure. So I wrote a book Unleash your Business. Unlock Wealth, autonomy and Control by Buying your Building and Firing your Landlord and I'm giving it away for free.

Speaker 2: 44:38

unlock wealth autonomy and control by buying your building and firing your landlord. And I'm giving it away for free. You just have to pay shipping. I think ears pert.

Speaker 1: 44:43

You said free and now everybody's like what's free again.

Speaker 1: 44:50

Yeah, it's free, just pay shipping, because we got to get this thing printed and then send it out to you. So if you go to our website for that it's simple, it's ownyourbuildingnowcom Ownyourbuildingnowcom you could pick up a free copy. In addition to that, I also have this assessment. It's a 90-second to two-minute commitment of your life.

Speaker 1: 45:12

Okay, it's very fast, yeah, and it's 20 questions and it helps you answer the main question and that is, you know, is buying commercial property right for my business? And it's free, we don't charge anything for that and it'll give you an analysis, a custom breakdown based on your answers to the 20 questions and four key categories. So it's real helpful to kind of get a baseline of where you are and it gives you some insights on what you can do. And of course, after all, that we're certainly available for we can do an ownership strategy session, call and just have a conversation, see if it makes sense. But as far as you know, first place I'd say check the book out or the assessment and it really kind of paves the way to you know a level of understanding then. Then we can have a really intelligent conversation at that point.

Speaker 2: 45:59

If it makes sense. Are you on social media at all?

Speaker 1: 46:02

Somewhere, I think. Okay, not very active, then we have a. We have a. I have a podcast. I host a podcast called called the Brick and Mortar Money Show.

Speaker 1: 46:11

Okay, and you can find it at the Brick and Mortar Money Show and a YouTube channel. It's called the, the entrepreneurial agent. And uh, people ask me, why do you call it that? And it's like, well, I kind of look at myself as almost like a sports agent. You know, jerry McGuire. I'm like, okay, I'm going to help, I'm gonna help my entrepreneur buds, you know, make as much money and have the best lifestyle they can have, and so I'm more like their agent and so you can check out the YouTube channel. And uh, and I'm out there in other places, but Well, I, I, I love this concept.

Speaker 2: 46:48

It's because a lot of business owners, we think about growing our business, but we don't think about growing our wealth, and this is an avenue that's not really talked about very often. I do have some guests and things like that's been on here and they talk about residential investments, but not commercial. So I appreciate you sharing this information. Last question, before we get off here If there was a room full of business owners, what one advice do you think would be applicable for all of them? It could be a life lesson, something you've learned or something you're still learning of them.

Speaker 1: 47:16

It could be a life lesson, something you've learned or something you're still learning.

Speaker 1: 47:24

Yeah, I'd say the biggest lesson that I'm still learning and relearning is really to cultivate a clear vision of where you want to go, because I think we are goal-seeking individuals.

Speaker 1: 47:30

We're created to realize a vision and goals and everything, and and everything kind of kind of funnels down out of all that. But it starts with what do you want your life to look like? And then, from there, what do you want your, your business, to be? I mean really, really, what do you want it to see that you can internalize and have that picture to really focus on. Because you know, at the end of the day, you know we're, we have this thing called the automatic mind that focuses us, you know, and it does things you know on. You know, by habit, that um, that determine a lot of outcomes. But you have to sit, you have to set the thermostat and tell it what you're after, right, and really just making that vivid and and and and being being all about that, that mission, cause, at the end of the day, you're going to look back and you're like, okay, what did I do?

Speaker 2: 48:19

Yeah, yeah, yeah, no, I agree, Paul. You've been wonderful. You've been a blessing today to a lot of people. Appreciate your time and we'll see you around.

Speaker 1: 48:29

Okay, Michael, I really enjoyed it. Thanks for the opportunity. My pleasure.

Speaker 2: 48:37

Welcome to the Recap and corner where I share actionable coaching advice to help you create a business that runs without you. In this episode, we had the pleasure of sitting down with Paul Neal, a former engineer who pivoted to entrepreneurship and established a strong presence in the commercial real estate finance sector. Paul demystifies the process of transitioning from tenant to property owner, presenting it as a viable and strategic move that secures a future income stream, leverages tax advantages and crafts a legacy that will endure long after retirement. He emphasizes that commercial real estate ownership is about asserting control over your business destiny and building value that appreciates over time. We also discuss the importance of cultivating confidence and mastering the art of handling objections in sales. Quality trumps quantity in entrepreneurship, and not every prospect deserves a seat at your table. And this leads us into my coach's corner, where I share actionable advice you can implement today for a successful future. It's all based on clarity.

Speaker 2: 49:41

For your actionable item this week, focus on discovering the clarity in your business or your future success. Start by doing these few things Define your ideal client. Review your sales process to determine who your ideal clients are. Look at your most successful client relationships and identify common characteristics and go find more. Evaluate your business vision. Reflect on your long-term goals and consider how they align with your current business trajectory. Ask yourself if owning commercial real estate fits into your future plans. Next, set clear goals. Establish specific, measurable, achievable, relevant and time-bound also known as smart goals to guide your business decisions. Clear goals will help you maintain focus and direct your efforts effectively. Next, streamline sales processes. Direct your efforts effectively. Next, streamline sales processes. Simplify and refine your sales process to ensure it aligns with your ideal client profile. This will help you attract the right clients and improve your conversion rates. By taking these steps a lot, I know you'll gain greater clarity in your business operations and strategic direction, setting the stage for future growth and success.

Speaker 2: 50:57

This sounds daunting. I know I've given you a lot to do so. If you need help, let our professional business coaches help you from boss. Go to businessownershipsimplifiedcom and schedule a complimentary conversation to get started. Thank you for listening to Small Business Pivots. Please don't forget to subscribe and share this podcast. If your business is stuck or you need help creating your business to run without you, go to our website, businessownershipsimplifiedcom, and schedule a complimentary consultation to learn why small business success starts with boss. Starts with Boss If you want to talk anything small business related, email me at michael at michaeldmorrisoncom. We'll see you next time on Small Business Pivots.