Turning Keys, Turning Profits: Jonathan De Gouveia’s Blueprint for Transformative Real Estate Investing

Josh St. Laurent: Welcome to the Wealth in Yourself Podcast, a show dedicated to helping you master the complex subject of money by simplifying it through stories and actionable advice. I'm Josh St. Laurent and this is Wealth in Yourself. Welcome to the Wealth in Yourself Podcast where we help people to design their ideal life and take control of their time and money. I'm your host Josh St. Laurent. Today we're joined by Jonathan Day Guvea. Jonathan is a real estate investor currently buying three to four properties per month with the exit strategy of flipping two investors on the back end or refinancing and keeping the property for his portfolio. I've been impressed with his work for quite some time and I'm looking forward to talking about his process. Jonathan, welcome. Glad you're here. Jonathan De Gouveia: Thanks for having me, Josh. Yeah, yeah, absolutely. Josh St. Laurent: So, hey, for anyone who isn't familiar with you and your work, what do you want them to know about you? Jonathan De Gouveia: About me, I don't know, I'm just kind of the regular guy and then I kind of fell into real estate. So, I was just learning and just developing my skills and improving our business in any way that we can. I didn't take a traditional path in real estate like a lot of people. Maybe they go to university or school and then they have a W2 job, standard 9 to 5 and then they transition into real estate. I used to work at restaurants and stuff like that and then this is kind of, this is my way out of those types of jobs. You know, the minimum wage jobs, this is my way out, it was real estate. So, I am forever in debt to real estate, I guess. Josh St. Laurent: I love that. Yeah, I want to dig into the story a little bit because like I touched upon it in your intro, like you're doing things at scale, right? Josh St. Laurent: Three or four properties a month and big projects I've seen kind of your before and after videos, you know, you're not taking on like a, you know, a small cosmetic job every time, you know, some of these are big rehabs. So maybe just starting from the beginning, like what was that first property? Like you were working in a restaurant and how did you get into the first property and what was that like? Jonathan De Gouveia: Yeah, so it's kind of a long story. I'll try to keep it as concise as possible, but I currently live in Cleveland, Ohio. I invest here locally in Cleveland, Ohio, but I, when I first got into real estate, I was living in LA, Los Angeles, California and I was working various kinds of like service, based jobs, you know, restaurants, stuff like that. The last job that I've ever had was when I was 23 and I was work, I'm 27 and I always just turned 27 a few weeks ago. Jonathan De Gouveia: I'm 23 at the time and I was working at a sweet greens for anybody that's familiar with LA. I was working at the sweet greens on Sunset Boulevard and Silver Lake. And basically like I didn't have a lot of money. This is right around the time, like a couple of months before pandemic, I had like pretty much like no money and I was just kind of getting by, I guess, and I didn't really have a long term plan of what I wanted to do with life. I was just kind of just having fun and enjoying things as they come and I read, I was, I've always been an avid reader. I dropped out of school when I was 20. I went to the University of Connecticut. My business partner, my now business partner and I, we moved cross country, dropped out of school together, we moved to cross country, LA and like I said, we didn't have a plan and we were just trying to have fun and enjoy our lives and trigger things out. Jonathan De Gouveia: Yeah, so basically when I was, well, I was younger, I used to read a lot of books and I still read a lot, but at the time when I was 23, I was working this job and I read Rich Set Ported and for all the people, a lot of people read that book and one of the things that stuck out to me a lot in that book was when you started talking about real estate and I was interested in it. So I wanted to figure out more about it. So I went to, obviously I went on Google and I looked it up and I saw this real estate seminar and I stumbled on the idea of wholesaling real estate and for those that don't know, wholesaling is essentially like, you know, finding a distressed property owner who wants to sell their property, getting the property into contract and then essentially selling the contract to an investor that wants to either buy the property to, to flip or to rent or whatever it is. Jonathan De Gouveia: I thought that was cool and it was in my mind, it sounds so easy and it was like this get rich quick thing that I thought it was going to happen. And yeah, so basically we tried my best partner and I, we've been roommates since we moved out over 20 and we were like, let's try it. So we started doing this thing and basically the first like six months was just very, very difficult. We were trying to do it like locally living in LA and it was just, it just wasn't working, you know what I mean? I was personally, I didn't have a car at the time. So what I was doing was I was literally getting on a bike. I had a bike that my friends let me borrow from his roommate. His roommate had a bike that he stole from like Burning Man and it had like, a leopard print seat and all this stuff. Jonathan De Gouveia: And he just gave me the bike, you know, let me borrow the bike as you say. And I would ride the bike in every single neighborhood in LA. Just riding, I'd ride like 14 miles a day on average. I was like calculating the on the time I was riding right before work. And I would just any property that I saw, I would take a picture of the house. And I would take down the address and we were just cold call and stuff like that. And it just really didn't work. Honestly, like we got some appointments. We tried to get some house on the contract, but there was just, it was just very difficult. So I had a member, I had met this guy at another networking event. I was real estate specific and he lived in Cleveland and he was just, he was just a vacation. Jonathan De Gouveia: I guess I could say in LA and he gave his number and I was just periodically at best, just doing stuff. And around this time we were six months in. We hadn't closed the deal and it was just a lot of just bang and head against the wall. We had no idea what we were doing, obviously. We'd have a lot of money for marketing and those kinds of things. So I called this guy up and I said, Hey, like I know you guys, you're doing some deals. And like, how can I help? And he inevitably told me that we could just call some lists for him. So you'd get, you pay for like lists for marketing and we were just doing cold calls. And then we would, we started splitting the deals 50, 50 or, no, sorry, 60, 40, 60, and 40% us. And we were just putting the deals and then we just worked our way up and then right around time with the pandemic hit. Jonathan De Gouveia: We had done enough deals where we made enough significant, at least amount of money to say. And then we just decided to move to Cleveland and that's where we kind of started our journey. And after two years of doing wholesaling, we, we moved out. We just decided it wasn't for us anymore. We personally didn't like the sales and the marketing aspect of the business. A lot of follow up, a lot of marketing, something like that. So we decided to start doing like buy and hold. And then that's, that's a whole other story. That's when we started getting into the construction stuff. And that's when it started getting really tough. Josh St. Laurent: Wow, wow, yeah, I definitely want to talk about that kind of next chapter, if you will. But before we move on to that, like what were some of the lessons that you learned wholesaling that you still use and apply today when you're trying to find deals? Josh St. Laurent: Were there good lessons there that maybe people listening could take away if they're trying to find their first deal, for example? Jonathan De Gouveia: Yeah, the wholesaling is from my perspective. It's kind of a glorified like nine to five almost. It's like a step up from having a regular job. But unless you start really scaling it, you're pretty much like you own a job. And that was something that I didn't like about it. I thought when we went into it, it was always with the idea of like, we're going to make a lot of money. And that's what my idea was, it's just going to get into it. It's going to be easier to make a lot of money. And it was like everything about that. And it was literally just like spending a lot of money on marketing. And it meant getting lists and doing, we were doing a lot of co-calling and texting at the time. Jonathan De Gouveia: And at the time, it was a lot easier because they didn't have all these regulations around. Like spam calls and spam text messages and stuff like that. And it was a lot of follow-up. And we were doing all the co calls for a while until we had some VAs and stuff like that. But at the first, it was just us doing the calls. And I didn't like getting on the call with somebody. And then they're, you know, yellow you and tell you to F-O or whatever it may be. And then you have to keep calling them because it's a lead. And you technically pay for that lead when it came to the marketing dollars. And you know, six months down the road. Now they're interested in selling and then we'd get the contract. I didn't like that aspect of it. But it did serve a purpose. Jonathan De Gouveia: And the purpose that it serves for us, at least, was that in the grand scheme of things, it really helped us learn about the market. Because when we first started whole-sending, we didn't really know anything about Cleveland. And then we finally learned about like what areas people were buying in. What areas, like investors were very, very excited about what areas were they not excited about. You know what I mean? And we learned about like basically the price that the houses needed to be at. For us to be able to make any money. So if we got it at this price, we know we had to, we could hold a set of this price. If somebody's willing to pay this price, when we got into our buy-and-hold and fix-and-flip journey, we were like, okay, well, we were getting on here and we were selling them here. Jonathan De Gouveia: But that's just because we had to pay for the marketing dollars. So we could pay for it over here and be on the other end of that instead of having to be the wholesalers and finding the deals we could find the people, find the deals for us. And we just pay at this price. And we don't have to deal with all the back-end stuff and all the follow-up and stuff. So that was really the biggest lesson. And it was a great experience because I think that for us, we have a lot of empathy for wholesales because we know it's like a grind and it's really hard to find the good deals. And you got to kind of dig through the weeds and stuff like that. So that's kind of the biggest lesson I got out of the wholesaling journey. Josh St. Laurent: Now, how did mentorship play a role or did it play a role, I guess, from the guy that you met in LA who essentially helped you in your journey out to Cleveland. And that was sort of his market. How did his mentorship play a role in those two years that you were wholesaling? Were you part of deals with him, where you could sort of learn side-by-side with him? Jonathan De Gouveia: So at the beginning, before I personally moved to Cleveland, my business partner, he moved here a couple months before. I was just kind of like, we had done a couple of deals. We had made some all like a good amount of money. And in my mind, I remember we had a monk who was like our first really, really good month, where we made like 30 grand. And we had very low overhead and stuff like that. And I had never seen that amount of money in my entire life up until that point. So I was under the impression that that's what I was going to be like all the time. Jonathan De Gouveia: You know what I mean? That was like, this is just like easy. It was hard getting to that point, but then when it got to that point, it seemed like everything was going to just continue to go that way. It was always going to be easy. So I was living in LA when my business partner came to Cleveland. And he was just like, he came here to Cleveland with the intention of going back eventually. But he just wanted to steal out the market and stuff like that. And then like after like four months, he was like, yeah, I'm not coming back. And like, that's when I was like, oh, well, I guess there's really nothing for me here in LA. So I might as well move to Cleveland. And but in that time, he was going to a lot of appointments in person and stuff like that. Jonathan De Gouveia: Before we were doing it all virtually, either the guy that was like our mentor, his name is Ricardo, either he would show up to the appointments. Oh, we would pay somebody like 50, 70 bucks just to take pictures. And then we would just negotiate with the person over the phone. So Joseph, which is my business partner, he learned a lot from Ricardo because they were just always like going to appointments together. And Ricardo is just like more experienced. And he was older too. So it like it kind of gave the little bit more credibility to that side of things. And he knew a lot more about like the construction side and the tier of costs. So when you're talking to a seller who has a house that's extremely distressed, it's hard to convince them that they that the price can't be at that. What they wanted, sometimes they need to be a little bit lower because of the construction costs and stuff like that. Jonathan De Gouveia: But they don't understand that because obviously if they did, they would fix it up themselves. They, you know, they figured it out. So that was really one of the valuable things we learned from him. Other than that, it was mostly just trial and error. And because it's like, it's hard to teach stuff, but people are so far ahead of you. When someone's like a couple years ahead of you, it's hard to teach them something because that things that they would teach you are no longer applicable, right? We have a friend, for example, who owns like 700 units here in Cleveland. He is a very wealthy guy. But he was buying houses like single family houses through the River Roman one bath houses for like five grand, like 10, 15 years ago. You know what I mean? Like there's nothing he could teach us that would actually be like something that we could learn because it's like he was buying houses for a tent of the price that we're buying them now. Josh St. Laurent: You know what I mean? Before they even need any renovation costs. So yeah, it was it was helpful, but to a certain extent, there's a point where I think that your experience is more important in having somebody teach you things. So walk us through that first deal without Ricardo, where you guys just had to sort of figure it out on your own. Jonathan De Gouveia: It was the first deal that you did not as a wholesaler, but actually going in and doing the construction and figuring it out the deal. It was like a first bird deal. Like for those that don't know, it burrs. It's like by renovate rent and repeat burr, whatever. And so when we bought that first house, we were still wholesaling at the time. We were still kind of like we had generated a bunch of leads and we were kind of working the leads and we came across this triplex. Jonathan De Gouveia: I was like, it needed a lot of work, but we didn't really know anything about the construction stuff. We didn't really even consult anybody about it, which honestly at hindsight, we should have had maybe Ricardo walk the house with us, but we didn't. He we just kind of just went with it. And that was like two years ago and that was probably one of the worst years of my life. I'm not going to lie. It was so terrible because we just didn't know we were getting ourselves into. And when you don't know where you're getting yourself into, you're kind of signing up for things that you obviously, you don't know, you know what I mean? Jonathan De Gouveia: So we bought this triplex. I think we bought it for about like $50,000 something somewhere around that range. And we had estimated to put like 25 into it. We did it all cash because we didn't have anybody that would be willing to lend to us. Jonathan De Gouveia: Because one, we didn't have anybody that we knew that we were willing to lend. And two, any hard money lender, they normally don't lend to people that haven't done some deals. And which is kind of like doesn't really make sense. You know what I mean? It's like for the people that go to school, you can't get a job because you don't have a case you don't have experience, but you can't get experience because you don't get a job. But like that's kind of what the hard money lending space is like. So we had to do a cash. We bought the house cash. And this is like all the money that we had, literally all the money that we had built up until that point. And we had just intended on fixing it ourselves. And we were way and over our heads like way and over our heads. Jonathan De Gouveia: We were just fixing up everything. Guys, we as we went, we did some drywall, we did some floring, some paint. That stuff was kind of easy. And then we finished two units. It was out of the three units. We finished them completely. And then we found out that there was like plumbing leaks and this, that, the others, and then we had to remove the drywall and then fix the plumbing and then be hired to contract you to the plumbing because we weren't confident doing the plumbing. And then he like ripped us off because we didn't know what we were doing. And then he just stopped showing up. I paid her him with the credit card. This is a tip for anybody that's paying contractors. If possible, I would say pay them with the credit card. That way so you could just do a charge back if they don't do good work. Jonathan De Gouveia: And it takes a little while. It took like two months to get the money back or some of the money back. But we got some of the money back. And yeah, he just just stopped showing up and, and, but that was one of the best things that ever happened to us because we learned how to screen people. We learned how to become a little bit better with the contractors. And funny enough, all that time that was lost and that, and finishing that project, the first one, it led us up to the moment where we met the contract that is now working with us today and he's worked with us since. And if it hadn't been for making all those mistakes and it hadn't been from buying that house and essentially making that mistake, then we wouldn't have met our current contractor who has led us up into this point. Jonathan De Gouveia: And so it was a blessing in disguise. The last thing I'll really say about that house is when we were finally finished with it, after all the headaches and stuff like that, we ended up refinancing at the other house to get our original money back, original investment back. And we ended up losing a lot of money because we didn't know a lot of things. Like again, we didn't know about rigid nation C's. We didn't know about Dicapraisal value that much. And we ended up tearing the garage into back. We tore it down. And in that destroyer, a Praisal value, it took like, I think, 10 or 12,000 dollars off to Praisal value. And then with the originations, the original C's on the back end when we got the loan, came out to like around 10 grand. So that was pretty much it. So you know what I mean? Jonathan De Gouveia: So the Praisal value came in lower than we expected. And then, you know, with the original C's, it really ate into our thing. So we ended up losing. I want to make clear. We didn't take any of the lose any money. That's the money we left in the property. It's better to look at it like a down payment. But our intention was to have no money left in the deal to bear it successfully. It's leading zero money in the deal or making a little bit of money. But after that house, all the lessons from that house transferred to another house. That we ended up that we bought as well. Around the same time, we bought this one. We weren't able to fix it because we didn't have money. So we took all the lessons into the next one. And that next house, we felt like we were forced to flip it. Jonathan De Gouveia: So we flipped it. And we flipped it. We made like 37 grand. And that was kind of like, oh, like, we could do that. We could do this. You know what I mean? Like, it's like, okay, like, if the numbers don't work out for a burble, we could just flip it. That's kind of when our brains started to turn on. And that's when we started like the next one. And the next one, and the next one, and the next one. Josh St. Laurent: Yeah, I love the journey. Like, I like the attitude of like, hey, that was the best thing that could have happened to us. So, I mean, now fast forward, you're doing three, four properties a month. You have a good contractor, a good team. You understand the deals a bit better. What were some of those lessons along the way? So if someone's listening and maybe they're earlier on in their journey, and they're like, well, what were some of these lessons? Jonathan De Gouveia: So the challenge is like, obviously, you got to find good deals. And good deals is a little bit subjective, I guess, depending on the person. A good deal for us is something that needs to see if it gets him on work. You know what I mean? Like, because that's what works for our business model. Our business model is finding a house that needs the most amount of work possible. But it has to be at a price that works, obviously, right? Jonathan De Gouveia: The reason why we like doing it like that is there's multiple reasons that one of the biggest reasons is time. We have a lot of contractors that work for us. We have one guy who is his general contract, but he has 16 guys that work underneath them. And our goal is to keep him as busy as humanly possible. So the way that we do that is we got to take on the heavier projects so that it gives us time to find more deals. Because if I get a contract for a house today, we're not going to close on it for a college 21 to 30 days on average, right? That's usually the amount of time that we give ourselves to be able to close on deals so we don't have any, like, cash flow issues within our business. So taking on those bigger projects allows us to buy ourselves from a little bit more time so that we can find more deals. Jonathan De Gouveia: That's our business model. The other reason why we like to find the houses that are very, then, needs a lot of renovations is because we spend more money at Home Depot and it helps us get to a point where we could start getting like the higher discounts with Home Depot because what all of people don't talk about is once you'll start getting like significant discounts at Home Depot until you pass the half million dollars a year threshold, you know what I mean? You'll start getting some decent discounts after a quarter million a year. You start getting better treatment and you'll start becoming a more reputable buyer in the eyes of a Home Depot, especially if you're going to the same store all the time. Once you get past half a million dollars, our goal is if we get by houses that needs 10 to 15 grand in materials for every single house we're doing for a month, then we're spending close to 60 grand a month and over the course of a year, that's going to be over a half a million dollars. Jonathan De Gouveia: That was our intention, that's our goal. That's how we looked at it. That's kind of baked into our business model. But as far as the things for the construction side of things, I'm not an expert in construction in that first house that we bought, we ended up having to do a lot of the work ourselves because we didn't have a lot of money. We ended up rewiring two of the units ourselves, you know, like complete rewire. We do all the plumbing work that the guy didn't do well. That was kind of a pain. We obviously did all the drywall work ourselves in the pain, the cabinets, and those kind of things. But just knowing the basics of how things function is going to be important because a lot of people they don't know how water gets from their water meter to their sink. You know what I mean? Jonathan De Gouveia: Like they don't understand that. And when you're going to buy a house, it puts you to disadvantage because when we walk a house, we already immediately know like for our specific business model, like we're replacing the plumbing every single time. And we're more than likely going to do a lot of electrical work. So our minds are already fixated like when we're walking a house. Like today we walk two houses. The first thing we do is when we look at a house, so we're going to be planning on making an offer on this. You know, it's a foundation good. Let's look at the electrical panels. And that's pretty much it. Like those are the most important things. And obviously the siding and the roof and stuff like that. But that stuff is very easy to identify. Yeah, I basically, I'm having a basic understanding of construction is really, really important. Jonathan De Gouveia: I would say focusing on plumbing and electrical is almost essential. And a lot of this stuff isn't rocket science. So that's the key right there is when you start to know enough of it, it makes it easy to have a conversation with someone to know whether or not they know what they're talking about. Because if not that complicated, you know what I mean? It's really not that complicated. Like again, I'm not an expert or anything. But I know like when we do duplexes, like on average, the material spend for a duplex on plumbing for both the plumbing drains and the water supply lines, it's like $1500 bucks to $2,000. That's the average spend. So I know they like, let's say I needed a plumber and they're going to give me a quote on the plumbing. If they told me that the quote's going to be, let's say $10,000, then I know they're trying to make like eight. You know what I mean? So now you can kind of like, you're putting yourself in a position where you know enough to basically know that the person is either trying to rip you off or they're not very professional, you know? So that's kind of my whole thing. And we don't have to deal with that as much because we have the same contract as we're going to all of our projects. So the prices are almost always the same, depending on the work needs to be done. But it's all baked in. So now it's pretty much streamlined. So we always replace the plumbing. We always estimate for you know, furnaces, water tanks, and that's kind of stuff. We sometimes replace the roof. It needs a lot of work. It doesn't, and that's pretty much it. Cabinets, countertops, new bathrooms every single time. That stuff's like pretty standard for us. Josh St. Laurent: We do all this stuff every sometime. Now did this knowledge come from walking properties with the GC or just doing a few properties where you were getting multiple quotes and then over time you started to realize, you know, I had 10K, is it an outrageous offer here? You know, I know what the materials cost because I've done this a couple times. Or how did that come to be? Was it you know, kind of partnering with the GCs and learning that knowledge from them or was it just experience over time? Jonathan De Gouveia: Most of it was experience over time. Our contractor is great. He walks almost all the time. I would say like about 80% of the houses. If he's not busy, you walk the houses with us before we've even making offer on it. He will tell me what his quote is for the labor and he knows how we want things because we've done a well over 30 houses already this year that are exactly pretty much cookie cutter. Jonathan De Gouveia: So he tells us what the labor costs are gonna be and I have a spreadsheet that I have developed over the last real two years of like all the common materials that we use, the price, the amount that we're used on average. And it's pretty streamlined. You just press a couple buttons and type a couple numbers in and then it just spits out the renovation costs. So that has been honestly that the spreadsheet that I have built over the last two years has been like huge game changer because it's really, really accurate. But it took time for it to become accurate because every single project that we would do, let's say I would estimate for simplicity sake, let's say we're emissimating for paint for a two better and one bath unit. It's about 15 gallons per unit. That's kind of where we're at with the wall paint and then you got another 10 for the ceiling and another 10 for the trim. Josh St. Laurent: So that's kind of where we're at. That's like our average. Sometimes it's a little less, sometimes a little bit more depending on the conditions or the drywall and those kinds of things, right? So over time that's what I've developed because I look at all the data. You know, when you use a Home Depot Pro account, I pull the CSV files after every single project and then I measure the actual against the estimate and I'm like, okay, well, I thought it was this but it really was this. And now you have a discrepancy or if you're overestimating now you know, you could kind of cut back a little bit. If you're underestimating now you know, you got to add a little bit more. And then over time it becomes more and more accurate and that way so when you walk a house you have a very, very clear idea of like what you're gonna be putting into it. Jonathan De Gouveia: So now when we walk a house, there's a book I run the grand for anybody that's a real estate investor in and in the book you'd say that all the houses that you do are you gonna be 25 grand, 30 grand or 40 grand in renovation costs. That's already said in the book. For us it's 30 grand, 50 grand or 60 grand. That's what the numbers for us. So when we walk a house that's how we think about it. It's like this is your 30 grand, 50 grand, 60 grand, you know what I mean? And if we get into the four units, like what we do between one and four units, we get into the four units now. That one's that we've only done a few four units so that one's kind of a little bit more blurred. The single family's all the way to Duplexes and the triplexes it's between 30 and 60 grand and the renovations and it's pretty standard. Jonathan De Gouveia: It was really experienced that really got us to that point and just checking every single house, we just, you know, looking at the data and seeing how much should we spend and then revising and trying to cut costs where we can and that's kind of what we do. It seems to me like an advantage that you have is the consistency where you've narrowed in to not just Cleveland, but it sounds like specific neighborhoods. The houses have a lot of similarities. You're working with the same contract or going to the same home depot. Like that to me seems like an advantage where things become more predictable, right? You're like, well, I did a Duplex like this a week ago. I can really accurately estimate the cost. I'm gonna work with the same exact contractor as before. So I've talked to a lot of real estate investors who try to do things all over the country because it's more difficult. Josh St. Laurent: Why do you know, I need to build a whole new team in this place, the prices of things are different. I'm not familiar with the neighborhood. So it seems to me like it's an advantage the way that you're doing things in the similar area was that by design, was that sort of like the path your mentor led you down or how did you end up, you know, in specific neighborhoods in Cleveland doing Duplexes and triplexes? Jonathan De Gouveia: The reason why we do things the way we do things, at first it was kind of just like, let's just find a good deal. And back to our whole sailing background as we knew what areas were like good areas and the reasons why they're considered quote unquote good areas that I'd be investing in. And you know, we live in one part of town where we wanted to kind of make it so that we could buy more deals in the areas that are close to where we live to make things really, really easy, you know what I mean? Jonathan De Gouveia: And over time, you know, at the beginning, it was just like we would just get deals, we would take deals wherever we could that were in neighborhoods that we knew were decent neighborhoods and we would just make it work. Now it's like we have so much deal flow and we have developed a credibility within the market with, you know, wholesalers and realtors and people and something like that where now we target specific neighborhoods because they're, you know, essentially located, they're really close to our other deals that we're doing. We know the prices really well of the houses and they're really close to the Home Depot. So right now most of the deals we're working on are within a five mile radius of where we live and they're all like within like a two mile radius of each other, three mile radius of each other and they're super close to Home Depot, like 10 minute drive to Home Depot. Jonathan De Gouveia: So we go to the same Home Depot and it's just so easy because they get that contractor can go make 10 trips to Home Depot in a day and it's not as much as we're bottleneck as going to a specific part of town on the east side of Cleveland. There's like no highway access to this one part of Cleveland and so you have to take like back roads and stuff and it takes like 30 to 45 minutes depending on like traffic if there's any traffic to get to Home Depot, you know what I mean? And it's like you can't realistically be buying multiple houses in a neighborhood like that because you're never gonna get anything done, you know what I mean? So at the beginning it was just whatever we could get and now it's where at a point where we have enough going for us and establish yourself enough where we will target those areas and what that really means for us is that we just let everybody know okay we buy in these areas and this is what we're doing and everybody just kind of wants to send us deals because they know we close, they know we know the prices and it really helps a lot because when we're in these neighborhoods we will find deals just by being in the neighborhoods, you know what I mean? Jonathan De Gouveia: Like when we're working on properties somebody across the street, oh I know this person down the street that wants a other house. They're more likely to sell to somebody like us because we're fixing up a house on that street and they get a common look at the house and those kind of things. So it really builds a lot of credibility and it helps us a lot to do things in specific neighborhoods because we're known for doing deals in those neighborhoods and over the long term that's the biggest benefit to us because when all these property values appreciate and we own a significant portion of a neighborhood that only benefits us more, you know what I mean? Josh St. Laurent: Absolutely, yeah I'm glad you brought up sort of like a longer term vision. I wanted to segue there but it seems like you guys have really built an awesome system and process for yourself in kind of a small area so that you can just duplicate it at scale which is really cool to see. Josh St. Laurent: What is the longer term vision for you guys? Let's say in 2024, do you have any big plans or is it just keep chugging along kind of doing what you're doing since it's working so well? Jonathan De Gouveia: 2024, our goal is to pretty much continue doing what we're doing. We don't want to scale too quickly. We're at a pace or at a level that's very, it's hard to get to this point, I guess you could say in some ways. At least locally here from the people that we know we are at like pretty much the top of the food chain as far as most real estate investors here locally. There are obviously bigger players at us but from the people that we know within our network we're kind of at that stage where we're doing a lot of deals and to go beyond that it's difficult. We're at a point where it's, you're at a level where it's hard to get to that point and it's even harder to get to like to double that. Jonathan De Gouveia: And right now we were focusing on efficiency, we're focusing on narrowing down like the things that need to do, we need to do. We're focused on, you know, maximizing our profitability, we're focused on making sure that we are being strategic about our finances too. That's spreading ourselves through thin, not doing too much. You know what I mean? But ideally we would like for the new year to get into bigger multi-family deals so that we could do one deal or two deals and it's the same as doing 10. You know what I mean? Instead of doing like 10 single-family houses we could do one building, it's a 10 unit. It's a little bit less effort. It's a little bit harder with the city obviously with the permitting and the inspections and those kinds of things. But overall it would be a little bit less of a headache because it would be a one location and we not have to go and do intended for houses and pulling draws from different places subject to that and getting loans in a bunch of different houses and having to refinance at a separate place is like, that's that kind of our thing. Jonathan De Gouveia: So we do want to maximize efficiency. I think that's that's the top of our list of things to do. We just maximize efficiency and just really just keep doing what we're doing before we start trying to scale it a little further. Josh St. Laurent: Makes a ton of sense. Well how it's off to you for what you've built? I mean, I think it's really amazing how you're scaling and also so targeted in an area that you are. I want to segue the three questions I try to ask towards the end of every show. More personal to you really. And so the very first question is, what does living a wealthy life look like for you? Jonathan De Gouveia: Living a wealthy life for me is honestly just being able to, being able to say, notice things is really important. That's number one. But also just being able to like have more freedom of my time to be able to do more of things that I like. Jonathan De Gouveia: At this stage that we're at, there is a lot of things that I do that I don't want to be doing. It's not that I don't, I like what I do. I like the business that I really enjoy, real estate and stuff like that. But there's a lot of things that I do within the business that I don't like doing. And my goal is to be able to remove myself from those positions and hire those things out to people. So that's where a wealthy life looks like to me is being able to have the financial means to be able to allocate tasks to people and things that you don't want to be doing because you feel like it's not your strength or you feel like it's not something that you want to spend your time on. And then you could focus on things that are more important to you. Jonathan De Gouveia: For me, it's like I want to be able to read my books and I've been doing a lot of woodworking stuff lately and my free time, I just did building furniture and stuff like that for my friends and myself and my girlfriend and stuff. So I want to be able to do more of the things that I like to do and focus on the things that I like to do within the business as well, not just on the personal side to focus on things that I really like to do within the business. Josh St. Laurent: Yeah, I love that. I love that answer. Just being able to spend your time in a way that pleases you, right? Do what you choose to do. Yeah, that makes a ton of sense. So if you could give one message to someone working to gain financial freedom who isn't there yet, what would it be? Jonathan De Gouveia: I guess this question is directed towards myself a little bit because I still like, I still climb and so so so so learn and put. My thing is, you know, when it comes to financial freedom, I think the biggest thing is knowing how you're building a business and how that is directly correlated to your personal finances. A lot of the stuff that we're doing is we're reinvesting a lot of that money, which, you know, reinvesting a lot of the money that's from our business, which means that we're not taking as much money out of the business for ourselves, you know what I mean? Over the long term, that's a greatly great play, you know what I mean? Obviously that that that means a lot of amazing things are gonna happen for us in the future. But in the short term, it's just making a lot of sacrifices that, you know, you hope that will play out and pan out for you in the best way possible in the future. Jonathan De Gouveia: So my thing is making sacrifices for it and to setting up your business in a way that benefits you the most, you know what I mean? So one of the things that we do, the reason why I would like spending a lot of money on Depot and this is a little bit of hack. I don't know if this is this applies to a lot of other places, but here locally, we have grocery stores that they sell home Depot gift cards at the grocery stores. We build a business around spending a lot of money on Depot because the more money we spend on Depot, the more gift cards we could buy and the more gift cards we could buy, we start getting free groceries and free gas. And like building a business around your lifestyle is the most important thing because that's how you get more of that freedom and be able to have more financial freedom in that way because you're building a business that suits you and you don't need to go and spend money on things that necessarily don't need to spend money on, you know, so that's kind of how I see it. Jonathan De Gouveia: And again, also being able to build a business that makes sense, you know, a lot of people think when it comes to real estate, they think, okay, you buy a house, you fix it up and you flip it and you're good and now you made a bunch of money. But for the people that make a lot of money in real estate are people that are either own a lot of properties or are flipping a ton or they flip very little amount of houses. There's people that flip, you know, three, four, five houses a month that make more money than us, like on a personal side, right? But we're building a business and because our long-term strategies to hold as many properties as possible, so a lot of the profits are being rolled into other to houses that we're planning keeping, the houses that we flip, the profits are being rolled into our house to be keep. Jonathan De Gouveia: So for somebody, you know, you really got to dial in like what is it that you want? There's some people that flip three, four, five houses and they make a lot of money and it's a lot less stress on their plate as opposed to people like ourselves where it's like, yeah, we're buying three, four, five houses a month, but at what cost, you know what I mean? I love doing this when we love doing this, but the person that's making, that's doing three, four, five houses in a year, they might be making more money on the personal side than we are, but our long-term success is gonna be a lot bigger than theirs. You know what I mean? So it just depends on what your goals are and there's a lot of people that they don't have very ironed out goals. So they'll just get into something and then they create a job for themselves and then now they're kind of like consumed by work and they don't see way out of it. Josh St. Laurent: So we have to have a long-term vision of owning as many properties as we can and being able to create a lot of cash flow and that's more important than the short-term gains of taking all the profits from our flips. That long-term vision is so, so important and I like the other point too of, you're gonna have to sacrifice. I think a lot of people get into real estate or just business in general, not realizing how much of a sacrifice it might be. So I love that answer. The third and final question I think is really applicable after hearing your story. The question is basically, if you only had a thousand dollars and you were starting over, what would be the first thing you would do with that money? Jonathan De Gouveia: That's a tough one. If I had a thousand dollars, that's tough. I'm caretally doing much of the balance. That's the question. The inflation. I would try my best to network and meet as many people as I can. I think that that would help a lot go to networking events I'd meet as many people as I can and then I would try to find a way to be useful to someone that has something that I don't. Like for example, when we started with the wholesaling stuff, we didn't even have a thousand dollars to spend, you know what I mean? So the way that we started was we were being, we were useful to someone, you know what I mean? Ricardo, he had done a good amount of deals, but he had a job. He was an engineer. His time was limited. So for him, the thousand dollars that he would spend or fifteen hundred bucks a month, he would spend on the marketing for the list and stuff like that was that didn't equal the amount of value that we were giving. And we were giving a more value than the thousand dollars he was spending a month or fifteen hundred bucks he was spending a month on marketing lists. So that's what I would do. I was just, I just pretty much do what I already did. It was just find somebody that you could help and be of use to evaluate them. But that meant doing something that you're not good at, well, figure that out. You know, learn how to get good at that thing and then be a value to that person because if you even if you have a thousand bucks or you don't have a thousand dollars, you'll be able to make a little bit of money and then you could turn that into more money and more money and more money and you're developing a skill along the way, which is something you could always monetize or you know, will lead you into other higher paying skills. You know what I mean? You might start at, you know, like our journey wholesaling and then we made a good amount of money and doing that, but we were like, well, we could flip houses and there's more opportunities there. And so that's that small skill of just being able to talk to people and being good at, you know, conversing and stuff that got turned into something that I couldn't have never imagined like, you know, four years ago. Josh St. Laurent: Yeah, spot on. That's such a good answer. I'm just gonna leave it right at that. For someone listening who wants to connect with you, where is the best place to track you down? Jonathan De Gouveia: I think the best place is LinkedIn. I've been posted a lot on LinkedIn. Jonathan DeGovia on LinkedIn, J-O-N-A-T-H-A-N, D-E-G-O-U-V-E-I-A. I've been posting a lot on LinkedIn. I do post, I try my best to post things that are relevant and also very helpful to people. I think that there is a lot of, when it comes to real estate, I think it's not rocket science. I don't think it's really that complicated, but there are a lot of nuances to the business that aren't really talked about much. And if you don't know those nuances or at least you're not exposing yourself to wanting to learn about those nuances, I think that you can make a lot of mistakes and those mistakes cost a lot of money, you know, at the end of the day. And the last thing you want is for, you know, to lose money that you can't afford to lose. When we lost money in our first deal, you know, fortunately we had money to lose. We were in a decent position when we got out of that. But there are a lot of people that get into real estate and they don't have a lot of money to lose. And if they make a big mistake, which seems like a small mistake at the beginning, it turns into a big mistake and then I'll be able to come back from it. So I do post a lot on LinkedIn. I really just like posting things that are very useful to people and hopefully a lot of people get a lot of value out of it. Josh St. Laurent: Yeah, I love what you share on LinkedIn. I actually think that's how you and I connected was me just following, you know, your videos and your journey and all the different flips that you've been doing. So I'll put the link in the show notes for anyone listening. If they want to go connect with you there, I definitely encourage them to do that. And with that, this has been the Wealth and Yourself podcast where we help people to design their ideal life and take control of their time and money. Our guest today was Jonathan Day Gauvea. Thanks for listening and we'll see you next week. The Wealth and Yourself podcast is hosted by me, Josh St. Loren, an edited and produced by Ray Haycraft. To learn more about how to make your money work for you, visit us at www.WealthInYourself.com and connect with us on all social media at Wealth and Yourself. This podcast is educational in nature and is not meant to be investment advice. Please do not construe anything said to be advice and the opinions of the guests may or may not represent the opinions of Wealth and Yourself. This podcast and the information presented are separate from my employment at Golden Gate University. Still, they are part of my mission to make no cost financial knowledge more accessible. If you like the show, please take a moment to leave us a review. We read all of your feedback and we wanna make sure we cover the topics that matter most. If you have a specific subject you'd like us to explore or a guest you'd love to hear interviewed, don't hesitate to shoot us a direct message. And as always, thanks for listening.