Episode 162: Scott Emsley provides a special perspective on the advantages of Profit First and a psychologist’s viewpoint on some of the difficulties faced by investors.
The Profit First REI Podcast
March 9, 2023
David Richter
Summary:
Today’s guest is Scott Emsley, a real estate investor with Clear Sky Properties. He has been in the since 2020, first starting with single-family homes before eventually dipping into multifamily properties as he does today.
Scott continues to work as a clinical psychologist while starting his venture into investing. Interestingly, he did not have a previous entrepreneurial background like most investors, making the Profit First system an invaluable tool for managing his finances and learning better money management.
With his circumstances and background in psychology, Scott offers a unique insight into the benefit of Profit First and a psychologist’s perspective on some of the struggles of investors. Tune in!
Key Takeaways:
[00:47] Introducing Scott Emsley and His Real Estate Investment Journey
[07:28] On Analysis Paralysis About Starting Real Estate Investing
[11:02] On Implementing Profit First and Experiencing Its Benefits
[17:40] Profit First in the Multifamily Space
[22:47] Real Estate Investment Without Initial Entrepreneurial Experience
[26:43] Scott’s Thoughts on His Career Without Profit First
[29:05] Advice for Real Estate Investors: Without a Business Plan, You’re Doing It Wrong
[30:30] Connect With Scott
Quotes:
[12:17] “[Profit First] is one of the biggest reasons why I’ve been able to pick up another 300 or so units [in] the remainder of last year.”
[27:52] “I’m not equipped to be a business owner if I hadn’t found profit first.”
[29:46] “If you don’t have a good business plan, you’re doing it wrong…If you don’t have a business plan, a business strategy, the house of cards is going to come toppling down.”
Connect with Scott:
Instagram: www.instagram.com/stewardscotty
Podcast: The Worst Ever Real Estate Investing Podcast (currently in the works)
Tired of living deal to deal?
If you are a real estate investor or business owner who is tired of living deal to deal, and want to double your profits, head over here to book your no-obligation discovery call with me. Either myself or someone from my team will hop on a short call with you to get clear on your business goals, remove any obstacles holding you back, and map out a game plan to help you finally start keeping more of the money you work so hard to make. – David
Transcription:
Scott Emsley:
<affirmative> all of 2021 and probably around January, February of 2022 is when I got exposed to Profit First. It was the kind of book that you pick up and then you don’t put down, you just let through it and then you go back and you reread the stuff that you kind of glazed over.
Outro:
If you’re a real estate investor who’s sick and tired of living deal to deal, then welcome home. Hear from everyday real estate investors just like you, and discover how they’ve completely transformed their business by taking a Profit First Approach. This is the Profit first for REI podcast, where we believe revenue is vanity. Profit is sanity. It’s time to start making profit a habit in your business. So here’s your host, David Richter.
David Richter:
This is David Richter. And we have Scott Emsley on the Profit First REI podcast today. This is an incredible one because he is a multi-family investor, but he has no entrepreneurial background at all and that’s where just a few years ago, he got a hold of real estate investing and it has gotten a hold of him. And he also tells how Profit First has saved his business multiple times and given him financial freedom and what it has afforded him and his wife and also their relationship. I believe that you will want to listen to this one, grab the nuggets and then go and implement some of the things he also tells you as well too. Hey everyone, it is David Richter of the Profit First REI podcast. We have Scott Emsley here. I am super excited about this one because I’ve been on his podcast and it was an interesting experience, to say the least cuz we got to talk about Profit First, but we also talked about psychology and just some deep questions on the back end, which he does with his guests. So he has real estate experience and psychology, you know, psychology experience. So I really excited to have you Scott. Thank you so much for being on the show.
Scott Emsley:
Thank you so much. I’m glad to be here. Glad to uh, reciprocate you were kind enough to come onto our podcast, so I’m glad I get a chance to give back.
David Richter:
Yeah, well I appreciate that because anyone who has a profit First story and how it’s helped them in their business or what it’s helped them through or what different things like that, we just want to get that out there. Message of hope to the people listening to give them hope that doesn’t all have to be doom and gloom living deal to deal. But I guess let’s start off, just give a high level background of where you’ve been, where you are now, like in the real estate world and I already opened the psychology bag so you might as well tell everyone about that as well too. So.
Scott Emsley:
Sure. So, um, I became a psychologist in 2013 and uh, I’ve been working in healthcare as a psychologist, uh, for the Department of Veteran’s Affairs for, um, 10 years now. And so I’ve
David Richter:
Oh wow.
Scott Emsley:
Really enjoyed, um, that experience. I love working with vets. I love what I get to do on a daily basis in that realm. Uh, and in 20 18, 20 19, uh, I was starting to look into real, wanted to learn more about how to grow my wealth and grow my family’s wealth. And so finally after a long, uh, analysis paralysis, I decided to get into real estate investing in October of 2020. I bought my first single family house back then and um, yeah, that was a good experience, but I intended to do the Burr model. So for those of you who are familiar with that, I intended to buy it, rent, renovate it, rent it out, and then refinance it. However, because of market and me kind of over improving the property, uh, I didn’t refinance anything out of it. I couldn’t, um, so I put $40,000 of my own money into it and then I couldn’t refinance out. So I’ve still got that property and it’s still got that original loan on it, but, um, <laugh>, I’m gonna be refinancing hopefully here soon. So, uh, that was my first property in October of 2020. Followed up shortly by a duplex that I bought in November of 2020. Um, and that because of the lack of proceeds from the first property as well as buying the second property, um, that kind of tied up most of my liquid funds and I was like, Hmm, this is not how it’s supposed to go. Um, so I was like, I was still working, I still am working as a psychologist and still, uh, doing uh, very good work there, but saving up that kind of money to buy properties takes a lot of time. And so I started looking into partnerships and how I could, um, how I could effectively grow the business. I partnered with my first partner on the third property, which was in bought in December of 2020. She and I had already been friends, she was a real estate investor at the time and she had some liquid funds to deploy. So we bought two fourplexes together. Um, and that was great, but that was the extent of my first year. Um, so 11 units, I’m not balking at that. I’m saying that’s
David Richter:
yeah
Scott Emsley:
A very good first year especially cuz it was all within three months. But
David Richter:
yeah.
Scott Emsley:
Um, yeah, it was not what I thought would happen
David Richter:
<laugh>. That’s great. So yeah, that’s a, then that is really good. I think a lot of people would be happy if they did 11 units their first year. So then where are you now? Now we’re recording this at the beginning of 2023. How did 2021 and 2022 treat you?
Scott Emsley:
Yeah, so in the middle of, so from October of 2020 to October of 2021, That’s all I got. I got those 11 units
David Richter:
yeah
Scott Emsley:
And that was great. Um, but in July of 2021, I started looking into multi-family, specifically syndications. I wanted to learn more about that process and how to combine a bunch of people’s money together cuz I exhausted my funds on the first three units. I exhausted my partner’s funds on the third property that I bought, the two fourplexes. So we ran outta money, like that’s not how it’s supposed to go. So July of 2021, I, uh, looked into various, uh, different masterminds and I decided on the seven Figure Multi-Family Mastermind. Um, that’s where I met Caroline, my good friend. And so I met her through the seven figure program. And so I joined the seven figure Multi-family mastermind and then took me six months to find my first true multi-family property. And I bought that in December of 2021. Uh, that was a 16 unit property, so
David Richter:
Nice,
Scott Emsley:
Small in the multi-family world, but big for me,
David Richter:
Right.
Scott Emsley:
Uh, and so I bought that, uh, my, again, I did the workload. My partner at the time, uh, he brought the funds. He was a good business partner and still is my business partner today. Um, and then, so that was the first multi-family property that I bought and then that kind of opened the floodgates. So six months after that I bought a 52 unit, then I bought a 64 unit, then I bought a 60 unit, then I bought another 64 unit.
David Richter:
Wow.
Scott Emsley:
And then I bought, uh, two weeks ago I just closed on a 48 unit and we’re currently under contract on a 20 unit. So
David Richter:
There you go.
Scott Emsley:
Um, the first year I got, uh, 11 units to my name, which is good.
David Richter:
Yeah.
Scott Emsley:
Uh, the second year I got 304 units to my name. Um, and so I’m, the grand total is up to 315 units currently with a couple of other, uh, development projects and other things in the wings that we are working on now.
David Richter:
So you mentioned analysis paralysis, which I think a lot of people have. Why do you think you had that analysis paralysis up front? Just scared to pull the trigger or just scared to make a bad investment? What was going through your mind?
Scott Emsley:
Yeah, so, um, that was probably, uh, I can partially attribute to my life as a psychologist, you know,
David Richter:
okay.
Scott Emsley:
Working for the va, the federal government, working for a stable, secure job where I just, I go to my nine to five and I just do the same thing every day. And that stable security was kind of like a safety blanket.
David Richter:
Yeah.
Scott Emsley:
Uh, and <laugh>. So, um, it took me some time to kind of finally pull the trigger, but then once I did, I pulled the trigger in a big way and I took,
David Richter:
Yeah,
Scott Emsley:
No kidding. I grew in a big way. Um, but that’s why, I mean, uh, I stalled out for two years just learning, uh, it wasn’t wasted time, I suppose, but it was like not real estate productive time.
David Richter:
Yeah.
Scott Emsley:
It took me that long to finally say, okay, I’m ready to go into my first deal.
David Richter:
Yeah. Well, no, that’s great. Why do you think a lot of people have analysis paralysis? Could not every real estate investor has a psychology background, so I would love to know from your perspective as a psychologist and just being in the real estate world, why do you think a lot of people have the fear of tr pulling the trigger?
Scott Emsley:
What we do is so unorthodox, so unusual and, uh, you’re getting bad messages. Um, not ill intended messages, but bad messages from every angle. Your
David Richter:
Yeah.
Scott Emsley:
Your parents are probably like, what are you doing? This is not how it’s supposed to go. And, um, and your colleagues, maybe you’ve got a stable nine to five job. Your colleagues that work are saying, what are you doing? That’s, that’s ridiculous. My colleagues say that about me today. Nice. Even though I’ve got 315 units to my name. Um, so they say, you’re gonna go bankrupt, look at the recession coming, look at the interest rate hikes look like you’re gonna lose your entire life savings and all of your family is gonna be jeopardized by it. I had to get my wife on board. I had to convince, you know, her to partner with me in this venture. So,
David Richter:
Yeah.
Scott Emsley:
Um, I think the thing that holds us back, uh, all of us, uh, whether you’re a psychologist or not holds us back is that fear of failure. And fear that you’re, you’re, um, all of those people are gonna be somehow Right. Uh, they risk nothing by saying, yeah, you’re gonna fail. They really, there’s no risk in that. Um, and there’s that piece of yourself that says maybe there’s a grain of truth to that I may fail. And in fact, even in my own experience kind of bringing it full circle to profit first I did kind of fail and I failed on that first purchase. I over improved it and so I didn’t get my money back out.
David Richter:
Sure.
Scott Emsley:
And then even after I had those 11 units, um, I had not been exposed to Profit first yet. I didn’t have that mindset or that background. So, um, yeah, I was not operating my business efficiently from a profit first perspective. And so yeah, there’s a lot of failure in being an entrepreneur and venturing out into real estate, which is expensive items. The most expensive thing that most people will ever buy is their personal residence.
David Richter:
Yeah.
Scott Emsley:
Um, and so to buy another residence on top of that sounds crazy to most people.
David Richter:
Right. Yeah. That’s, those are really good answers. I want to then dive you, you set it up. So let’s dive into the Profit first side. So it sounds, when did the prophet first grab you then? Because it sounds like you had a period of time there where you weren’t with the Prophet First Mindset or hadn’t read the book or anything. So I’d like to know like before and after, like how did that look and what got you excited about Profit First?
Scott Emsley:
Yeah, so I did not implement Profit First until after my first multi-family property. So
David Richter:
Okay.
Scott Emsley:
I wasn’t even aware of this book or this methodology or the mentality. Um, so all of 2020, you know, the three months of 2020 that I owned those properties, picked up those properties, uh, all of 2021 and probably around January, February of 2022 is when I got exposed to Profit First. Uh, I, it was the kind of book that you pick up and then you don’t put down,
David Richter:
okay
Scott Emsley:
You just let’s through it and then you go back and you reread the stuff that you kind of glazed over. So, um, that was my first exposure to Profit First and it fundamentally changed, uh, my trajectory. Um, it allowed me to be, so I had the 11 units from my first year. I had the 16 units under my belt, but I was still not kind of operating from a good business perspective.
David Richter:
Yeah.
Scott Emsley:
It is one of the biggest reasons why I’ve been able to pick up another 300 or so units, um, the remainder of last year. So, um, if I didn’t have the strong foundation of having some profit, um, I wouldn’t have, so another side story here about this February-ish timeframe is when I read Profit First, uh, we implemented that immediately. I went, opened a bunch of bank accounts, um, and my wife, uh, and I were both, um, looking at different career options. She decided she was pregnant with, uh, our daughter who was just born three months ago.
David Richter:
Congratulations.
Scott Emsley:
And so she decided that she was gonna break off and go into private practice. That was a very uncertain financial decision cuz she was also working for the va. She is also a psychologist. Um, and so going into private practice was uncertain territory, but I had set up this Profit First model and so the owner’s compensation that technically was mine, um, that went to her and that paid her all the rest of last year. Um, the owner’s compensation, I had never taken an owner’s compensation. I had never taken any proceeds from my business other than maybe a couple dollars here and there.
David Richter:
Yeah.
Scott Emsley:
I’d never taken any proceeds. So when April rolled around and she decided, yeah, I’m gonna go do my own thing in private practice, um, that the Profit First model gave us the luxury, the freedom for her to do that, to make that decision to break away and, and do her own thing and in the unstable time before she got established
David Richter:
Yeah.
Scott Emsley:
Um, to cover the income that was lost by her leaving the va.
David Richter:
That’s awesome.
Scott Emsley:
Yeah.
David Richter:
So it sounds like she might be a fan of Yes,
Scott Emsley:
She is
David Richter:
<laugh> as well too, so now that’s great. So with the multi-family at that time, how many units were you sitting on back in February when you
Scott Emsley:
Yes.
David Richter:
Implemented it?
Scott Emsley:
So I had the 11 units and I had the 16 unit property.
David Richter:
Okay.
Scott Emsley:
So that was 27 units to
David Richter:
Yeah.
Scott Emsley:
To my name as of when I implemented the strategy.
David Richter:
Okay.
Scott Emsley:
Yeah.
David Richter:
And then you’ve had that and which year was that? That was 2022. You had
Scott Emsley:
Mentioned 2022 February of 2022, but probably around Feb, January or February of 2022. Yeah.
David Richter:
Then you did mention that Profit First helped you get to, was one of the major reasons you got to 300 units. Can you tell me a little bit more about that? Was it having the extra money and you were able to go get more funds or was it like having the funds available? Like how did it actually help you get more properties?
Scott Emsley:
Yes. So, um, I have used very little of my own personal funds to actually fund the acquisitions. So Okay. I have great partners who are capital raisers who bring most of the funds to the table. The one exception to that is that I am often the one putting up the money for earnest money deposits. I am often the one putting up money for the PCA reports or the inspections. I’m often the one putting the down payment with the lender to establish to allow them to do their lending, underwriting and all that. You know, you have to pay that upfront.
David Richter:
yeah
Scott Emsley:
Um, so I’m the one who’s funding most of those things. And so if I had not had the profit account, um, kind of reserves ready to deploy to those future business ventures, and I know there’s some, uh, concern about redeploying money from profit into back into your business, but that’s how I fueled my, that was my reward, so to speak. My right.
David Richter:
Yeah
Scott Emsley:
My payday, uh, my, the thing that fulfills me is buying more units, buying these bigger multi-family properties.
David Richter:
Yeah.
Scott Emsley:
So even though it wasn’t me taking my wife out on a, nice dinner or an extravagant beach vacation Oh, you just with the profit one Yeah.
David Richter:
<laugh>,
Scott Emsley:
um, a
David Richter:
Little bit more,
Scott Emsley:
Yeah.
David Richter:
A little bit more appealing than just one dinner date.
Scott Emsley:
Yeah. And so now we’ve turned what probably was 60 or $70,000 in my profit account into $20 million worth of assets right now, um, that we’re sitting as a, a piece of, we don’t own a hundred percent of 20 million, but
David Richter:
Sure.
Scott Emsley:
Like, um, we are a small piece of the pie and the Profit First model not only paid her for going on maternity leave and switching jobs, but also paid us, uh, down the line. Like it has amplified itself.
David Richter:
Yeah. That’s awesome. I love hearing that for sure. And it also sounds like too there, you know, like it helped to get those units and you were able to put up that money and like you said, this is what you wanted to do. What I don’t like is when people use profit just to cover expenses, you know?
Scott Emsley:
Sure.
David Richter:
They just keep going, spending, spending, spending and just spend themselves into the ground. But like you said, this is what you wanted to use that money for because it’s gonna buy a lot more dinners
Scott Emsley:
<laugh>
David Richter:
Than just going out there and, you know, purchasing that one really nice one or whatever. So that’s, uh, no, I absolutely love that. So it sounds like it gave your wife freedom, but then it’s also, like you said, amplified what you’re able to take either from the business or like from the money that’s coming in and give it, you know, probably give it a better name or a better, you know, separation of what’s yours and what’s not. So would you want to talk about that a little bit in the multi-family world or just real estate in general, money can get confusing. Has it helped you bring any clarity to business and to what is yours versus what you know you want to use to grow or whatever?
Scott Emsley:
Yeah, so, um, it was, it’s before I implemented Profit First it was like money came into a kind of joint account, uh, a semi joinin account. And then, um, that was all kind of business money. Like it was, I treated it more or less as all business money and I didn’t get to, um, I didn’t get to play with it. I certainly was not going out and buying nice things with it, but I was also not, never saw the, the proceeds of it from a business perspective either. So it was kind of, money comes in, money goes out. I didn’t really have any accounting for it or, I mean, I have an accountant and a bookkeeper, but like, I didn’t have, I didn’t have a good mentality for what is profit, what is anything profitable or am I
David Richter:
right
Scott Emsley:
Always just kind of net zero because that’s kind of how it seemed like the money was flowing. It was always roughly equaling after a month or three months or a year.
David Richter:
Right
Scott Emsley:
Um, so it gave me the clarity to say, oh, this is money that my business has generated above and beyond all expenses. Um, this is money that then I can choose to go have a nice dinner with. And I would have no qualms with doing, with doing that whatsoever. I would love to do that.
David Richter:
Yeah.
Scott Emsley:
And we’ve, we have spoiled ourself with a few things.
David Richter:
Awesome.
Scott Emsley:
Um, so that’s some of the profit or the owner’s compensation has been on things that we want, um, to enjoy and uh, have good times with, but at the same time, it’s also fueling our greater growth, our greater business trajectory, our ba our greater, um, direction that we want to take both of our lives in.
David Richter:
No, that’s awesome. I love what it has afforded you and what the clarity that it’s given you. Sounds like it’s given you a lot of freedom too, and just a lot of that clarity to be able to make those decisions. I do have a question. So you’re running a lot of mainly multi-family units.
Scott Emsley:
Yes.
David Richter:
Did you set up profit first any different than you would’ve if there’s single family or you know, like you kept going if you know, if you still had those first few units by themselves, like have you set it up any different than what the book recommends? Or do you have accounts that are specific to you, just out of curiosity?
Scott Emsley:
Yeah, so I have, um, I would call it an operating account. The label on the account is, um, is just the property name. So I have a different account for every single property that I own. Um, but that’s the collective place where, uh, when the property manager, and so I’ve got property managers on every single one of these properties. Uh, the property manager makes a deposit after all expenses are paid to them. Uh, and all those, it comes into that collective account. That’s where I also pay the mortgages, pay the lending from. So it comes into that one collective account. Um, it goes out from that one collective account, but at the end of every, well, it’s not the end of every month, but like after we get the deposits from the property manager, then the funds are dispersed into a centralized account, which is, uh, we’ll call it income. So that’s the income. And then from that income account, I separate out into the three accounts.
David Richter:
yeah
Scott Emsley:
Um, so the taxes, the owner’s compensation and the profit accounts. Uh, and so I do that process. So it goes from all these different places into one.
David Richter:
Awesome.
Scott Emsley:
And then from one into three.
David Richter:
Yeah.
Scott Emsley:
Um, so that’s how I’ve structured it. That’s what, just the way my brain works.
David Richter:
Yeah.
Scott Emsley:
Um, and I think part of the Profit first model is to tailor things really to what works for you and how your brain things and how you operate. So that’s how I best handle things. And then I never have to worry about, oh, am I gonna have enough money for the mortgage payment? Oh, am I gonna have enough enough money for the tenant that moved out this month and needs renovations? Right. Like, I’ve got that one central account where money comes in, money goes out to the income account, um, the extra money that goes out to the income account and then gets divided up from there.
David Richter:
Yeah. I really love that for multi-family. Cuz then you’re almost treating each individual, you know, uh, property as its own business, you know, so it’s like he comes in there and you have it, and then you push it to income and then the rest of it is dispersed around there. You know, it’s like having, it’s almost like having a bunch of mult, you know, multi businesses out there or entities and then it all flows up into some master account. So I really like that setup up. So if you’re on here and you’re thinking like, does this work for multi-family and other types of real estate investing, because we have a lot of single family people on here that come on and tell about their experience, but I love hearing it from, you know, a different angle as well too for the different multi-family people we’ve had on. So that’s awesome. I did wanna dig into one other thing.
Scott Emsley:
Sure.
David Richter:
You said that, you know, like you’ve been a psychologist and you’ve been in like working with the VA for the past 10 years, and I’m wondering, do you have any entrepreneurial background with yourself or your family or like your wife and her family? Like, it sounds like you both work, you know, just normal jobs and had normal, you know, like that w2. So I’m just wondering, did you ever have any of that in your life growing up?
Scott Emsley:
No. And neither has my wife. Not as far as I can recall back,
David Richter:
yes,
Scott Emsley:
As far on my family line, um, as I can recall, everybody has the more traditional nine to five kind of job.
David Richter:
Okay.
Scott Emsley:
They either have a job or a career, but that it’s in a stable, a relatively stable, secure kind of single track. Um, and so, and I’m also very much a penny pincher and so,
David Richter:
Okay.
Scott Emsley:
My wife would accuse me and I, you know, all of my grad school colleagues, like I talked about investing in money in grad school, um, I did presentations on it. And so all of my grad school colleagues who may watch this, uh, or listen to this podcast later, um, they would be very surprised to hear kind of how I’ve ventured off the deep end <laugh>,
David Richter:
Right.
Scott Emsley:
Because I am not the entrepreneurial and, um, getting your psychology degree, and I think this is true also of medical professionals, folks who go into medicine, they get virtually no idea of how to operate a business
David Richter:
yeah
Scott Emsley:
In any of their training. You get plenty of education on how to do things that you’re never going to do again. Um, but the things that really matter, uh, you never taught that in grad school or, um, and the truth is that, uh, how many of us know how to draw a parallelogram, um, but
David Richter:
Right.
Scott Emsley:
Uh, and know how to calculate the angles of a parallelogram but don’t know how to calculate our taxes.
David Richter:
Right.
Scott Emsley:
Um, and so the same thing is true about our whole education system all the way up to including your doctorate. Um, both neither one of my wife or I got any training in how to operate a business. So to answer your question, very
David Richter:
Turn the corner then for you.
Scott Emsley:
Yeah.
David Richter:
Because you said like there was a point where I wanted to have financial freedom for my family. Was there a book or was it a conference? Like what was that turning point to be like, entrepreneur?
Scott Emsley:
Yeah, so I’ve always been invested, I’ve always been interested in investing.
David Richter:
Yeah.
Scott Emsley:
Um, so ever since I was a kid, I was investing in the stock market. Um, but investing meant the stock market. It meant that that was the singular track for investing.
David Richter:
Yeah.
Scott Emsley:
Um, until my brother-in-law in 2018, um, talked about real estate. And
David Richter:
yeah
Scott Emsley:
So I was, that kind of got me interested in real estate. Um, the truth is that the book that everybody says, rich Dad Poor Dad,
David Richter:
yeah
Scott Emsley:
uh, made me shift my focus from stock market investing and doing the, uh, millionaire Next Door. I remember years ago giving everyone in my family and everyone that I liked, um, the book, uh, millionaire Next Door, um,
David Richter:
yeah
Scott Emsley:
For Christmas. And so, uh, when I read Rich Dad Poor Dad and I was like, yeah, this is not, this life that I’m living is not gonna make me the millionaire next door. Uh, I’m not gonna be a millionaire at all. <laugh> even with great income that I’m earning, uh, and all that sort of thing, like I need to go a different track. So Rich Dad Port Ad is the one that turned the corner for me.
David Richter:
Okay. Yeah, there we go. I was like, there has to be something because no background, none of this like you liked investing, but like you said, it was the white collar stock market, you know, it was like, that’s what we were going down. But that catapulted you then into getting the, you know, your first deal done and then you now have 315 units and, you know, becoming an actual business owner, which you didn’t learn <laugh>, it sounds like in your psychology school, you know, like to be a psychologist. So they, you know, you got no training there, but then, you know, then you enter the business world and then, you know, it’s like the self training. That’s really what you have to do on that side. And I’m glad you were glad you read Profit First last year and were able to get that so you could get actual help during, with your business. Because I guess if you hadn’t implemented Profit First, do you think you’d either have as many units or where do you think you would have ended up without, you know, implementing that process?
Scott Emsley:
I mean, uh, in my mind, bankruptcy is never something that I ever plan on doing. I don’t think ever anybody ever plans on doing
David Richter:
Right.
Scott Emsley:
But I think I would’ve been in very dangerous territory. Like,
David Richter:
Okay,
Scott Emsley:
uh, I can see that the catastrophic, and maybe I’m over catastrophizing this, but
David Richter:
nope.
Scott Emsley:
Like I could have seen my business going under at very least. Um, and me turning away from real estate investing altogether and going back and continuing to do the white collar thing, investing in the stock market perhaps in the very slow way, investing in mutual funds only, and only in very safe, secure assets and like realizing, I’m not cut out for this. I can’t handle this because clearly, I’m not equipped even with my doctoral degree, I’m not equipped to be a business owner if I hadn’t found profit first.
David Richter:
Yeah.
Scott Emsley:
Um
David Richter:
Huh. That is, I love that because that’s where I feel like a lot of people get into the real estate world and they don’t have this, you know, the proffers and they are, they’re facing bankruptcy and it’s like they don’t even know it though, you know, like that this is coming. So I love that answer. I don’t think you’re catastrophizing it at all. I think that is a lot of people go down that road and if they don’t have it can definitely, but I’m very biased too. I mean that’s why I run this show. It’s for answers like that, it’s for the, where someone who can literally have a psychology degree and be a psychologist and then jump into real estate, but then they don’t just read Rich Dad, poor Dad, you also read a book that <laugh> helped you stay in real estate as well too. So that’s what I wanna give people hope, it doesn’t matter if it’s single family, multi-family, if you’re, you know, just getting started. That’s where you can build those habits now. And if you wanna stay in real estate investing and build that financial freedom, listen to what Scott is saying. This is not just me saying it, this is Scott and real life examples. So Scott, this has been awesome. I think you’ve given a lot of people hope here. Just two final questions. Do you have any advice for the real estate investing world, especially when it comes to their money?
Scott Emsley:
Yeah, the, um, the thing to realize whether it’s real estate investing or any other kind of investing, um, is that you are a business owner first.
David Richter:
Mm-hmm. <affirmative>,
Scott Emsley:
And you, the vehicle that you drive to get to that destination doesn’t, that could be anything. It could be opening a flower shop, it could be, you know, opening a pharmacy. It could be investing in real estate, it could be stock market, it could be anything you could imagine or whatever vehicle makes sense to you. But you are a business owner first. And if you don’t have a good business plan, um, you’re doing it wrong. So I don’t care how good of a salesman you are, you can make lots of money in a very short period of time, selling, flipping, wholesaling real estate, but there’s going to come a time where you’ve, if you don’t have a business plan, a business strategy, it, the house of cards is gonna come toppling down.
David Richter:
Yeah, man, that’s really good cuz I love what you said. You’re a business owner first. The vehicle doesn’t matter. You’re just, you might, if you’re listening to this, you’re probably in the real estate investing vehicle or want to get into that vehicle and this is how you make sure that there’s always gas in the car,
Scott Emsley:
<laugh>,
David Richter:
Making sure that you can go as far as you possibly want to with that vehicle. So, no, I love that. Then since you provide a ton of value here, is there any way our listeners can provide value back to you? Like do, is there a way to connect with you or a website or podcast or whatever it is that you wanna direct people to?
Scott Emsley:
Yeah, so, uh, I am hopefully going to be publishing a podcast here very shortly. Um, it’s called The Worst Ever Real Estate Investing podcast. Um, but even, even though that’s kind of in the works and in development right now, uh, the best way to connect with me, uh, and I would love to connect with anybody that wants to is find me on Instagram. My Instagram name is Stewart Scotty, that’s Stewart as in stewardship, uh, Scotty and Scotty has an y on the end.
David Richter:
There you go. That’s how to get ahold of him. Make sure to follow him on Instagram. Scott, this has been awesome and I really appreciate your time. I also wanted to say, if you’re listening to this as a real estate investor or business owner and you’re like, what the heck? What has he figured out that I can’t figure out that, where in the world am I going wrong with my money? And you want to make sure that you could either get your wife freedom or your spouse or you know, like whatever it is. If this resonated with you, head over to simplecfo.com. We’ve got our team of CFOs there that if we can help you, we want to, we want to implement profit first with you, make sure we hold you accountable. And if not, we’ve got great people to ping you to as well. If you need a bookkeeper cpa, we just wanna make sure you don’t have financial headaches. So head over there if you want to, to simplecfo.com and book a call. Thank you so much, Scotty. This was, like I said, this was really good stuff. I think you’ve given a lot of people hope here. And remember, make Profit a habit in your business. Thanks again, Scott.
Scott Emsley:
Thank you so much.
Outro:
This episode of the Profit First for REI podcast is over, but there are plenty more where that came from. Are you ready to learn how David and his team can help implement the Profit First system in your business? Schedule a discovery call at simplecfo.com right now. We’ll see you next time on the Profit First for REI podcast with David Richter.
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