0:00 Today's episode of the hybrids podcast today I have special guest, Mr. Ken ghee. What part of the country are we speaking to you from? 0:08 today? I'm in Cleveland, Cleveland, at least half my time in Florida. That's where we do most of everything. Well, 0:15 I'm originally from Indiana, and my wife calls Indiana, Ohio, Michigan, the armpit of the US. I don't know how you feel about that. But 0:23 I'm pretty much in agreement with that, sir. It was not a bad place. It's just not growing. 0:30 Yeah, it's a my wife, my wife equates it to the sun doesn't shine there. 0:36 Yeah, we have a lot of cloudy days. Next year, that's what happens. Yeah. 0:43 It's crazy. Because like, it's just crazy. The dynamic of the Midwest. And if you ever been to the Midwest, it is a special place that you only visit once. 0:55 That's a little rough, but I'll go with it. Okay. Okay. 0:59 Which is why I'm glad you spent half the time in Florida. So yeah, I can I can, I can understand that. See me, I grew up in Indiana, outside Chicago. So the only thing I kept with me was the phone number. Everything else is gone. 1:13 Everywhere I go in the country, I always talk to somebody who has a connection to Cleveland. And the theme is that they had left 1:22 be an artist. And that's how it should be if you're from the Midwest. 1:26 It is why the Cleveland Browns fan club is the biggest in the world because they're all over the place. Because they were in Cleveland and they went around but they still got the browns. You gotta love the browns. That is as 1:39 funny. Man, this is good. It's good. I was like getting a little a little though icebreaker out there. Because it's always a good conversation for people who are from the Midwest is the Midwest, that is one thing, can you tell people a little bit of your background where you're from? So they kind of get an idea for me over two minutes into the episode. So let's let's kind of let's kind of jump a little bit of what you do how you do it and trying to help? Yeah, yeah, 2:04 so Well, I grew up not in Cleveland. But I grew up in Toledo, Ohio, and even more incredible town. If you know where that is, it's northeast or northwest Ohio, moved to Cleveland, I don't know in 2091, anyone it was, but I got my undergrad from University of Toledo went to Cleveland went to work for a bank got my master's degree from Case Western Reserve. And at that point, I would then went to work for Deloitte as a CPA. So I spent seven years there, but it was set it was during my time at Deloitte, when I decided it was time, man, if you know anything about CPAs work hard, man. It's hard. It's hard. And, man, I don't want to do this forever. You know, actually, if I could share the story, I mean, it was one night about it was about three o'clock and my daughter had just been born. I did her night feeding. And I was really cool time because it was her knee. Right? Everybody else leaving. I mean, you can't beat that time with your brand new daughter. And her son was it was three o'clock in the morning. I started thinking to myself, Man, I love this time. But wait a minute, this is my time with my daughter. That's my cool. I don't want my time my daughter be at 3am I want to go to her basketball games and football games. Well, she didn't play football. But you know, I wanted to do I wanted to be there for I wanted to do all the things that you want to do with your family. I said, Man, I don't see how I can do this. So that working for Deloitte, you just working way too hard. So that was when I decided I had to make a change. So I spent about a year and a half trying to figure out this real estate thing. And I bought three properties during that time, all small deals like less than 30 units each. And three years later, I sold them and made like half a million bucks. I was like, oh my god, are you kidding me? Like, I just made more money on the side than I did when I was to that time. When I was at Deloitte. I'm like, wait a minute. You know, I thought I had everything right, right. I got a good job. I went to school, got good grades, everything you were supposed to do. But it was this thing that I did on the side that actually really made me realize it was gonna make a difference in my life. So that night, I came up with a plan but I didn't know if it would really work, right? You hear people doing this? Well, three years later, I'm like, this works. This works. There is no way I'm going back. So that started the process of me then weaning myself off of that w two job. And this is all I've done for the last 2526 years now. 4:30 mazing amazing. I am 31 years old. So 4:35 it's all for you, man. If you're not real estate now you shouldn't be 4:39 that I quit. I quit to the experience level of people that have been through I mean, 25 years it's maybe two recessions at least. Maybe picking one right now. You have some expertise there that a lot of people may not have. And one thing I really like asking people have been in the in the business lines Ivan's How do you? I know you get better with experience by noticing when it's coming. But how do you transition? Like if you're doing multifamily? How do you transition through different up and down cycles? Or? Yeah, 5:14 well, first of all, it's it actually starts before you get into the recession. It starts with discipline, right? I mean, everything we do is super deliberate. So how do I do multifamily? Why don't I do office and medical and self storage? Because I can't figure out how to make people not need a place to live. Yep. Right. So that's the basis. Okay, so now, what kind of multifamily should I buy? Well, I don't want to buy the really new stuff. First of all, it's super expensive. And at the time, I couldn't afford it. I don't want to buy the really, you know, the really rough properties, because allows people don't pay their rent. And they're very much affected by recessions. So I said, let's stick in the middle where most people live. So that was very deliberate. As it turns out, when recessions come and go, the top of the market gets hurt a little bit. The bottom definitely struggles, that middle ground is where most people are, and you have the best chance of making it through that situation. So that so that was very deliberate, then I thought, Well, wait a minute. Most businesses make money because they find a way to create value. Well, wait a minute, that just makes sense. Let's do value add properties, let's do value add multifamily in growing markets, because now I want to have more people want to live in an area that is available housing, that gives me good good pricing power, and in good neighborhood right in the middle of that market, that I can add value to because in this business, what I didn't understand as much early on, which I definitely understand now, was that multifamily is not like single family, right? Single Family is valued based on rent, or sales, comps in the neighborhood, stuff like that. Multifamily is valued based on its ability to generate cash flow, sometimes Wait a minute, so now I have a business here, that if I can find a way to make it generate more cash, there's a pretty good chance somebody will make me that will pay me more for it later. Right? This is more cash. Um, so you what you see me doing here, is trying to mitigate every risk that I could imagine and come up with in my brain as to what would go wrong. Let's figure out ways to mitigate it and then maintaining that discipline. So now when the recession comes, I'm as shielded as I can be, right? I mean, I can't It can't be 100% shielded, but I'm not, you know, I don't have all my tenants losing their jobs, because, you know, they're living paycheck to paycheck. You know, I've there's so many things in place that make it so that I minimally affected by by recessions. Now, I really got a good taste of it. When I the first 10 years we spent in Cleveland, Cleveland, uh, we were joking about Cleveland. But I mean, we did well in Cleveland. I'm not gonna knock Cleveland for that. But, but I thought to myself, wait a minute. I get my tenants in Cleveland, by stealing from the guy next door. Right. I mean, it's a brutal world. So I'm, yeah, I mean, that's what happens. Yep. What if I actually worked and move to a place where people want to live? So I don't have to steal the tenant from the guy next door, I decided to open the door because they're coming. And when we went to Florida, 15 years ago, life completely changed. Because now see, I before I got to see the demand lower than supply, Florida's the exact opposite. I'm like, There's no way I'm going back to a neighborhood or a market where demand doesn't exceed supply, you see. So all these things kind of wrapped together help to really protect me from recession. So does that make sense? Yep. 8:39 I have a unique question for you. I'm curious of your answer. So I like I like that you can you want to be in place, you want to place where demand is high, you can control the rents, you want to be an upcoming art because you want to increase the NOI. One of the ways that now we will talk about that, I think I think you'll have interesting perspectives. You can control the financing. And if you can control your debt and financing, you can, that's a good variable that not a lot of people think about is a variable, but it also increases your cash flow. 9:09 It does meant well the biggest lesson to be learned member you said I've been in this a long time. Yes, in a few recessions. Well, I saw the Oh 809 thing happened. I literally watched it minute by minute by minute I was glued to see. I mean, I know I feel like I know just about everything that happened. And the people in the multifamily world they got hurt then got hurt because they didn't manage their debt maturity, right. It's a turned out member. If you think back, they'll you were definitely not thinking about those 9:42 guys. I mean, I was thinking about you didn't care about the recession. 9:45 But what happened then was the regulator's came in and all real estate on the banks books was just toxic, right? You probably heard that word. So the regulator said you get rid all the real estate off your balance sheet, because we're gonna make you write it down although there's a lot more to What I'm trying to pay and kind of stay at eye level. And so the banks are like, okay, when that loan matures, we're not refinancing it. But Mr. Lender, I've been with you for 20 years. The things cash flow, I don't care. We want it off our balance sheet goodbye. Yeah. But Mr. Lender, I don't have anywhere to go because no one else will refinance it. Yep. All right, then turn in the keys. And that's that happened to people who weren't careful about managing your debt, because it just didn't understand that that could happen. And I see people today who don't manage their debt well, are in trouble right now. Because they manage their their variable rate exposures, what they didn't manage. 10:37 So I've already seen that. I don't know if you've heard stuff in the multifamily space already and stuff that you said there's a big guy, he lost like 20 million in assets, and everybody's heard about at this point. But yeah, 10:47 all sorts of media articles. You have me up. 10:50 But I think it goes down to managing your debt. Your variable debt? Yeah, well, let's I don't know, I don't know if about multifamily debt as a whole. He talked about, like, what the general terms people receive, and why that variable that can influence and how it affected that person in Houston? Yeah, so 11:09 yeah, well, I don't know how it would have. Well, there's a lot of things that went wrong in Houston. Okay. I don't, and I don't know enough about it to really give it an honest discussion as to what I read in the newspaper. And we know we have to be careful with that. Yeah. So here's what happens to people though, with respect to debt right now. Most of the properties that were bought in the last 234 years were bought using bridge loans. And why were they there, bridge loans bridge loan is a loan that is designed to help you take the property from here to here, and they will lend you some of the money to do that. And that's fine. Except it's not fixed rate financing. It's kinda like a construction loan. Right? So it wouldn't meet the normal debt parameters. It wouldn't meet the normal debt coverages and things like that, that they're investing in the operator that says, Okay, I'm going to put this money in, you put some money in Mr. Investor, and we'll make this property good. We're gonna then make you because we're worried about interest rate exposure. Now, this is the bridge lender saying to the borrower, yep, you need to manage that risk. So we're going to ask you to go out into the market and buy something called a rate cap. So what it's like an insurance policy is all it is, here's what rates are today, Mr. borrower, and we're going to ask you to buy a rate cap, that's going to make sure the rate doesn't go above this, and you have to pay for it. And usually, it's either one two or three years is what people had to buy. So people bought those rate caps, and there's nothing wrong with that. That's good. That's good. Management management, here's the problem. Nobody predicted that a year year and a half into that rate cap, the Fed was gonna raise rates 500 basis points. So now we have this loan that is protected or was protected. But that rate cap is expiring. So now it becomes fully exposed to the market. So when the rate cap was holding the rate at 4%, it's now six or six and a half. And so the Think about a $10 million loan, and a $10 million loan, 1% 100 grand a year 200 grand 250. You can see, you can see all of a sudden, we're all any cashflow that property had is now going to the bank, now to investors, and hopefully, hopefully, you'd had a business plan that allowed you to raise rents enough that you could, you could pay it. But if you didn't, and your business plan didn't work out, there are people out there who were in trouble because they can't they they got to pay an enormous amount for a rate cap now, like give me an example. It's an insurance, the rate, it's ensuring that there it's like puts a ceiling on the rate, right? index goes up and it says nope, can't go any further. And what happens is, the other party to that insurance policy pays you the extra interest expense to make you whole that's what happens. It's really it's really kind of interesting when you think about how it functions, but that's how it functions. So you have a Counterparty paying the excess interest for you think of it that way. But now, when that three year term expires, that guy's like, Hey, I'm done. Now, man, you're on your own brother. All right, you gotta pay the interest of yourself. But the lenders like you don't have enough cash flow here. So you got to buy another recap, or you got to sell the property because you don't have enough cash flow now to pay the debt grows. And that's where people are, some people are being forced to sell. Some people are trying to buy new rate caps that are, you know, to give you an example, we had a rate cap that we paid like 36,000 for a year, year and a half later, it was worth 300,000. That's a 10x on on the cost. So if you had 100 Delta recap that now cost a million bucks. Well, I don't know about you, but you got a million bucks laying around and just throw away at a rate cap. You don't. So that's what's going on right now. Now, some of those people didn't even buy rate caps. They were just hey, let's just let it for loan because I don't think rates are going anywhere. Well, they were obviously very wrong. Those people are getting destroyed. 15:08 Wow. Okay, so they have variable interest rates was the market and then buy the rate back down and now they're being exposed to the market, which is not good. And it's seen in public cash flow, which are forced to sell. And the only equity they have is equity, they put down with their private capital or investor capital. And now they're having to exit and now a lot of people are having to exit which increases increases the amount of inventory, which lowers the value and cap rates that people are buying. 15:36 Well, actually, the value is not going down because of excess inventory. There's very little properties on the market right now. Okay, the reason there are is because the only people selling are the ones who need to, okay, here's, here's why. So you've heard something called a cap rate. Yeah. So what happens when interest rates go up? Right? There's two people in every deal, the lender and the equity guy. Both of those guys want returns on their money. One of those guys who's putting in 67% of the of the deal, they raise their interest rate, guess what these these guys have to take some of their money and give it to the bank in order to make it work. So that means cap rates have to go up before you could buy it a four cap or even sometimes in the threes. Now those same deals, they don't cashflow unless you're buying it at a six cap. Well, that's talking about the erosion and value there. It's massive. So what's happening these people are being forced to sell or being forced to sell at prices, that all that equity that was in it is gone. Yeah, it's not worth as much. So there's, there's a lot going on here. Right? There's there's still we're still about six to nine months out from probably seeing and feeling the worst of it. But it's happening right now. That's why people that have good properties that don't have to sell, like why would you sell in that environment? No way I'm holding on. My property is cashflow and I'm safe. I'm protected. I'm not gonna put my property in the market right now when the only people selling are the people that need to. 17:06 Yeah, no, I, I think with the with the cap rate erosion, that dividends, dividends on your on your pro forma potential pro forma, you know, yeah. One thing I want to hit on too, is how, and this is I guess, maybe too late. But for the next recession, how do you how do you stabilize yourself to get is it buying that cap rate when it's is a buying that cap rate by down when it's cheap? Is it maybe possibly talk longer term debt? That's not variable? Like how do you how do you solidify and preface that for? Yeah, especially because I know 17:47 that that's a really good question. So now, so what happens when markets change? The credit markets change. So now you can get a bridge loan still, but it's a lot more expensive? Yeah, like a lot more, you wouldn't use a bridge loan now. Because there's no way you'd find a deal that that made sense for. So now, people are turning to Freddie and Fannie, those agencies, and those are fixed rate products, usually. So they're financing them differently than they were, I will tell you what we tried to do. Here's what here's what matters, long term debt management, you want to manage your maturity, give yourself as much flexibility as you can. And you want to manage your rate so that, you know, we're in the real estate business. We're not in the interest rate, but we're not gambling with interest rates. So try to fix your rate. And, you know, we just fixed a couple of loans. And you know, you do it and you say, Okay, well, if rates go down, that's okay. I'm still okay. if rates go up. Yeah, I win, right? Don't Don't worry about it. Just fix it so that you can do your deal. Do it right, do what you're supposed to do with your business. Just make sure that your rate is fixed as you can make it for as long as you can make it but still support your business plan. See what happened is people intended to get in and out of those deals in two years. But rates skyrocketed on that Mr. Powell raise rates and massive amount. So they can no longer get out after two years. But their financing was set for them to get out in two to three years. So they weren't wrong going in. It's the market changed on them. And they didn't plan for that. So we do the same thing. We just we just protect ourselves and make sure the other the other way that you deal with this is through really disciplined underwriting and only buy deals that have really a ton of upside. Because then if rates go up on you, I got all bunch of whole new cash flow more to afford that debt. And that's what makes it possible to get through those times. 19:44 So there's been it's been being more selective on what you actually take on buying every stock up to something that's absolute, that every deal is for you and you shouldn't buy every prospective opportunity that is presented. 19:58 Yeah, and right now what's how putting a lot of people that have the you know, FOMO is right fear of missing out. There's a lot of people with FOMO. And they're kind of compromising. Now that if I call, I'm going to steal this deal, right? And they think because the seller isn't a little bit of duress, they're stealing the deal. But because they're not taking care of business and underwriting properly, they're really not getting a steal. They're really not as in as good of shape as they think they are. So people just I really encourage anybody listening, make sure you do your dot your i's and cross your t's on your underwriting, be be honest with yourself about the underwriting, because otherwise you're gonna get yourself in trouble because sellers are doing anything they can to get out stuff right now. 20:39 Yeah, yeah. I remember they're talking about this, because I think the financing is a big point, too, because what what financing you can get, even right now determines what you could buy. 20:51 Yeah, Fannie and Freddie are the most popular places right now for debt. Two years ago, no one used I guess there is a bridge debt. 20:59 That's funny British, 21:00 just kind of how it goes. It just kind of how it goes. 21:03 So what so you are an investment firm? So you're buying capital? Are you a fund or you just are? 21:11 Well, we did? Yeah, we did syndications for a while. And Florida is pretty competitive, as you know. Yeah. And so everybody that buying a syndicator. So, you know, we've been at this a long time on it, man, I pay it up to differentiate myself right as just another syndicator students. So we went out and raised a fund. So we raised you know, syndicators, find the deal, then go raise the money, we flipped it around, we raise the money, and then go find the deal. You know, I knew it would be a differentiator when we did our first fund. And it was, but what I didn't understand is just how aggressive brokers would be sellers would be when they know they're dealing with an entity that's already raising money. We don't have to hope and pray that we've raised the money because we already have so makes us a massively stronger buyer. So that's why we do the fun thing. 22:01 Okay, I have some fun questions, because we're in the midst of starting a fund. We, how do you raise? How big is your fund right now? 22:11 Yeah, the last one is about 16 and a half million bucks. This one's gonna be somewhere between 10 and 15. I like that size. It worked well for me. 22:19 Okay. Okay. So how do you raise funds? And where do you find that people raise funds? Cuz I know, depending on what type of fund you are, you can do different types of measures, but like, how do you do it and what type of people are generally looking for? Invest in your fund? Yeah, we 22:35 do a 506 C fund, if you know what that is. That means that we can openly solicit I can have this conversation that I'm having right now with you. And so I'm allowed to do that. But I can only let it an accredited investors. So that's the drawback, but that's cool. I mean, that's okay. So that's what we do our fund, I already laid out our whole business plan. That's what our fund does. So what's different about a fund? If I were talking with you about investing in my fund, I don't have the building to show you. Yeah, I don't have the exact p&l and the projections to show you. It's called a blind pool fund, meaning you have vetted me as an operator, you can see what kind of deals we've done. Our, our whole entire track record is, is available, and was fully vetted by veribest. So I had a third party look at it, and you can see all we've done our value add deals for, you know, 25 years, so you can see what I've done with this exact same business plan. So now over time, after you talk to me, and you hear me and you, you know, you do your research, you realize, Okay, I think these guys are the real deal. I want to make a commitment to their fund. And so you commit to the fund. And then we as soon as we find our first deal, we'll call the capital, and then you'll send in the money, we close the deal, then we go to the next one. And the next one, that's kind of how it works. Yeah, but it's a different race process. Because I don't have a pretty picture of a building, right, I can show you examples of everything we bought in the past. And we're gonna continue on the same plan. But I don't have 123 Main Street to show you. So you can see exactly what you're investing in. You're investing more in us, and our ability to to make it work right, which is really what you're investing in anyway. But it's just more of a, you know, it's hard to do it if you don't have any experience. 24:27 So how long has it been since you started your first fund? 24:32 Our first indication we did back in oh four, I think and the first actual fund. It's probably three, four years ago, maybe something like that. I don't know. 24:43 So, okay, so you transitioned over time. It's, yeah, 24:46 I mean, we've raised probably 30 35 million bucks, something like that. I don't remember what the last number was. I should know off top my head but I just don't. 24:55 Well, the one thing I've learned about funds is that it shouldn't be all on us. So you probably have a fundraiser, and there's different Capital Partners that actually do all other things in the fund that you can actually do. Yeah, I mean, 25:07 it's my company. So I'm involved in most everything. But yeah, we we've got about 50 employees. 25:13 50 employees. Yeah. Yeah. That's amazing. No, it's really cool. I said, we're venturing into the fund space I'm learning all about. I'm learning a lot a lot about this and regulation and raising capital. And 25:26 we have a good SEC attorney. That's my best advice. 25:29 Yeah. 100% 100%. One thing, one thing I mentioned, too, is that when you when you get into a fund, it's more credibility on you. And I think he meant you kind of alluded to that, yeah. Because there's no deal. It's you have to have the track record the ROI, what preferred returns you're offering, why they want to invest in you, and you have to really sell yourself on that point versus selling the deal. And I think that's a big, big difference. 25:56 It is massive. And I'm, you know, it's really important to me that we're transparent. That's why we hired veribest, to go through our track record, and figure that out. That's why, you know, on our YouTube channel, we have a whole several, we have a lot of videos there. But a couple of more I just talked about exactly. Here's the deal we did, here's why we bought it, these are before and after pictures, this is what we were thinking, this is what we did, this is what it looks like, this is what we sold, take you through the whole process, because you have to have visibility, right? You're asking somebody are minimums, 100 grand, you're asking someone to commit 100 grand to you, you they need to understand what you do and how you do it. 26:35 100% Yeah, 100%, it's almost like, it's magic, you're educating the person as well, because they might not have, you don't give them like a to z on what to do, but kind of break it down. And soon, you're gonna give them the C version, the F version and the Y version. Together. 26:53 Yeah, I mean, everybody's a little different. Some people just they don't want the they don't want to know how the sausage is made. You want to know how it tastes, but there's other people who they want to not made. And, and, you know, you need to be prepared for both. I'm happy to have any conversation with anybody. Because, you know, again, everything we do after 25 years, everything we do is so deliberate. Like, nothing happens in our company by accident, or just because it's, we did it this way, we learned a lesson. Now we do it this way. And this is why we do it this way. Because we want to avoid whatever it is that could go wrong, or we think could go wrong or did go wrong. Right. It's that very deliberateness. That's why it does investors can ask me any question they want. If I don't have the answer, I'll let you know. But most of the time, we have the answer, because nothing happens here by accident. It's all very purposeful, and intentional. 27:47 And there's a there's a process for everything. You have a you have a process for everything. So you can break down that process for anybody that I need to know about that individual section of that process. 27:58 Because every one of our processes has a process, it's documented, think about how airplane pilots fly airplanes, there's a reason that they don't fall out of the sky. They have, they're trained, they have checklists, they have a review process, and they have redundancy, we build all those things into all of our processes. Because you can't when you're dealing with people's money, you don't want it you don't want to have something slipped through the cracks. 28:21 So I think this is alluding to maybe people that want to transition into maybe raising more money or transitioning into larger assets, you need to build in those processes as a whole, to show your inefficiencies and fix those inefficiencies as you may have, as a small business, it's just into larger business. 28:40 Yeah, you know, what we do here is no different than any business. I mean, you're if you're gonna take, you know, 20 units, and then scale to 2000, you got to have processes, right? Because I'm not at every property. I'm not there. When people move in, I gotta know that it's all happening the way it needs to happen. Right? That's called scale. And that, you know, that's all part of growing a business. But as you grow, you know, you need to nail those things down. So you're dead on man. You're hitting it right on the head. 29:11 Why? Why is a real estate, not passive income? In your eyes? 29:15 Yeah. So this, this one always cracks me up because everybody, you know, they buy a single or double. And they view it as passive income. Right? They think, oh, yeah, I just show up in his mailbox money. I'm like, Well, wait a minute. Who who fixes a leak? Well, I was just over there last Saturday, and I painted the unit and wait a minute, what part of that message is passive? Yeah, sounds to me like that's active. So what I tell people is, especially with the really small stuff, there's no passive. I mean, you're active, okay? You can't even afford to pay someone else to do most of the work. You got to do it yourself. So you're definitely active. Now, as you know, as our company grows up, I'm active, right? I'm not passive in anything that we do. Who, but if you were to give me money and invested in our fund, now your passive that's true passive, we're all you don't you don't do anything I do all the work, you just open your well actually now you open your bank account and see the ACH deposit in your bank account 30:15 that doesn't say sign a cheque. 30:19 Actually, we do still have a couple of we do have a couple of investors who want checks, and I make fun like why are you doing this just like what else do I have to do except open the mail and, and open that check and take it to the bank? I said, Alright, fair enough. All right to check if that's what you want. No worries. So one away for them. 30:39 I had a funny story. So I talked to a older investor, one of my old mentors from early on, and he said he gets a check from he does a triple net leases, ground leases. Yeah. Well, he gets a check in the mail. And he said he threw away his check on accident. And it was like $50,000 30:54 I hate it when that happens. 30:58 That's why why is 31:00 $50,000 Check. 31:02 Oh, man. Yeah. Sad story. But I think technology has made things a lot easier underwriting, communication, transparency. Just raising money opens up the world to you at your fingertips. I'm sure it's a lot more easier to raise money now than it is was back then. Even though obviously, I'm more experienced now. But it's also easier to connect and make those connections. 31:25 It is it is but you know what the message I want to send to people is, you know, if you're an investor, I want you to choose carefully who you invest with. Because there is no one looking right. There's no one that's audited most people's books. Yeah, this is more, you just got to be careful. So just look for people with experience with a track record who's willing to be transparent. And who put you first right, follow those four rules. That's really important to me, because I want investors to make money because if they don't, they're not coming back. And that's not good. We don't want that situation. Yeah. You know, like the guy you talked about lost all that money that you that's not cool. Yeah, it sucks that it happened and it sucks. I'm glad it didn't happen to me. Right. But it's horrible that it happened because there are a bunch of people who've lost money. And those people won't invest probably in our fund or maybe your fund, because they had a bad experience. And that hurts the whole, you know, hurts everybody. If that happened, here's the ecosystem 32:23 of what we do. And our Yeah, what we do and how we do it, because their negligence is even associated with us because we operate in the same space. 32:33 That No, that's exactly right. Yep. Yep. And that's not unusual for any industry. I was sharing this with somebody this morning is not unusual for any industry. That's kind of in its infancy. And I know you think Lowe's has been going on forever. But you know, the Jobs Act of 2012 is really what kind of changed the game. I mean, that was only 2012. That's only 11 years ago. That's not like it was 100 years ago, this whole thing is evolving still. So I encourage bouncers to be responsible, when they do their underwriting are what they promise investors, and I strongly encourage investors to follow rules. Because most of the time, you can see this stuff, right? You can say, Well, duh, like, you know, when you look back, you're like, Well, of course that happened. I mean, you know, you broke three of the four rules. Like I could predict that that might happen and, and that's my mission is kind of to educate them on that. Right? Because that'll help keep them out of trouble. 33:24 Yeah, yeah. What is a quote that is yours or somebody else's that you resonate with? 33:31 Man, there's a lot. If I pick it, like a self development, quote, I would always it kind of is really important to me, because it kind of happened to me. You are where you are, because you are because you because you put yourself there, right? You are where you are, because that's all your mind allows you to do. Right? So if you if I never made that choice to leave too late, and to go be something else, I'd still be a delight. And I would have missed all my kids soccer, basketball and everything else right? So wherever you are in your life, it's probably because you made the decision to be there. Right? So make change your mind change that you got to change your brain first. I know everybody says that, but I can tell you that I've personally experienced it. I you know, I'm 58 now I wish I would have thought the way I think now I wish I would have thought that way when I was your age man. I wish I would have because my life would have been very very different if I would have accelerated the whole process so that's number one thing that I want to share with people from a self development standpoint it just get kind of get out of your own way really is what ends up happening. And if you do you're gonna kill it. 34:42 I made a tweet yesterday. It was find it real quick. It says I posted I says if it says if you believed if you are guaranteed success what what dreams would you have? I like that. I like that man. So and a lot of people that you think you dream smaller because you feel like you can't spire get to that point. But you almost have to believe that you'll get there eventually, over time and distance, but you have you have that limiting belief that sets you back and always hold you back. 35:21 Yeah, no, you're dead on I think I think actually some people actually, I don't know, but I think they might actually get a little scared to take that away. And I can't, that seems scary to me to be there, right? You look at a really successful person. You're like, Oh, my God, that would scare the hell out of me to be there. Right. And I think that for some people that holds them back the other the other time, they just can't imagine. I mean, their life is what it is. And, and, you know, in order to make that happen, they have to kind of leave where they are. Now, a lot of people don't like to leave where they are. And if you know what I mean by that, right? I mean, sometimes it's just your circle of, you know, the people around you sometimes. Yeah, your bubble, sometimes. It just depends. You got to, you got to push forward and, and go be around the people that you want to be right if you do that, but that's hard to do, man. It's really hard. Especially if you're in a big fish in the in the pond, you're like, I'm the big fish in the pond, I'm cool, then to go make yourself be the little fish in the pond. It's scary. You're like, Why do I want to do that, that they'll eat me alive? Right. And they might I don't know, but it's a scary thing to do. And I think that's why a lot of people don't do it. 36:31 Know how 100% 100% I think you always got to change your environment and changing mentors. It pushes you to become the the better person over time. And it's not it's not a disease, it's not a fault of your mentor. It's just that you if you grow fast, you've go through a lot of mentors. 36:51 You do? Yep. Yes. And choose your mentors carefully. Yeah, no matter that is where you want to be. Don't pick someone who hasn't done what you want to do. You don't know how to do it either. 37:02 I will say I really want to hit on really quick before we end. I love the story of you feeding your your daughter when when she was Yeah, I did the same thing that was one of my big motivations to even go into entrepreneurship was I wanted to be there for my daughter and I, I did that for all of my children. And I was like feedings too. Because I'm I'm a night owl myself. So yeah. I took over from like 10 to 2am to tend to two three, for when they wake up like at six in the morning. I understand completely and I don't want to I kind of want to dive in a little more on the episode, he kind of brought it back around full circle again. So I understand and appreciate that. That one of you in that little in that little little phrase right there being being presents. Well, yeah, 37:50 I mean, I was your age was your age. Yeah, it was about your age. Yeah, I think I was about your age, when I when it happened. And, you know, man, when you I don't know how old your kids are. But when you have a new family and you're young, you're like, Man, the weight of the world was now on my shoulders. It's a completely different thing. Because prior to that life was not about anybody but yourself. It was all about me, me, me. And all of a sudden it's not about me anymore. It's about them. And these people really rely on me. And life changes a lot. So yeah, that that that is a true story. I will take my daughter to event from time to time and they're like, Is that the one I said? Yeah, that's the one and they're like, oh my god, she's not 25 years old and you know out on her own and has her own job and all that it's, it's it's pretty interesting. So enjoy the time while you can with these kids, because it's it's awesome when they're young. Toss them on the roller do but. 38:47 And with that one. Where can people find you online and invest with you? I think this has been a great episode I have covered a lot and I think fatherhood is good mission to build the life you want. And where people find you online. 39:00 Yeah, K ri partners.com/invest. So k r i partners.com/invest. When you go to that page, you'll see our track record all the videos that I talked about all that stuff's there. So you can see exactly what we do exactly how we do it. And then, you know, hopefully you were able to reach out to me and we can hop on a call and see if what we do is right for them. And if not, that's cool, too. 39:24 There you go. I appreciate you coming on Ken. I really had a great time. I hope our listeners enjoyed the full episode here. If you like it, go like share, subscribe. Tell a friend we'll see in the next episode. Thanks for tuning in. Have a great day guys. Bye