"Profit first" & A syndication story

Hello Cashflow Hackers,

Welcome to our 29 new subscribers!

Thank you for giving me the opportunity to write this Newsletter to you, it is so important for me to reflect on what I learned in business and life through writing this.

Please forward this newsletter to someone you think might enjoy reading this. We also have a Facebook group where I post ideas for discussion and comments but also free training to learn and practice.

Thanks so much for many of you taking the time to write me back and even compliment me for the last edition on Feb 27th.

It means a lot to me!

Noah Le: “First time I read the whole Newsletter, it was so good!”

Last week I had an emotional moment, so I cried on my husband shoulder at the gym… 😭 

Build in Public - “Profit First”

I just finished the book “Profit First” recommended by my friend Sanjay and now start to implement it into our businesses.

The book concept and principles are simple but powerful.

Instead of thinking:

Revenue - Expense = Profit

It should be:

Revenue - Profit = Expense

The book teaches ways to structure bank accounts so when we log in to our bank, we can immediately see how profitable our business is.

So that’s how your mind can focus on improving the profit and cutting down the expense. 🤓

For the past 3 years, I was so focusing on growth and ignored taking out a salary and profit.

On top of that I put stress on my husband since our personal saving which is accumulated from his W2 will be the back up for any bad months that our businesses are having. 🥲

Realizing that… I told my husband that I am sorry and I cried in public (at the gym). 😭

My friend Sanjay, who told me about this book, said that after he implement this, his business which did not make any profit for 8 years became profitable in year 10. 😇

And he said running a business without profit for so many years put a lot of stress on his ex-wife. 🥲 

So.. I want to shout out to all my fellow entrepreneurs and their partners. It takes a lot to be an entrepreneur. It also takes a lot to be married to an entrepreneur.

My husband many times had to see me could not sleep well due to a flip going wrong or some contractor did some bad job.

Sometimes he saw me waking up so early with many new ideas and so many things I want to do with the business that it’s hard for him to keep up.

On weekends, sometimes he would sit next to me patiently wait for me finish talking to an investor so we can enjoy a movie together…

I’m so grateful for all of that. ❤️

But sometimes, I forgot how hard it is for him and for other people around me to support me and go all in together with me in this journey.

To celebrate that, I’d like to have a profitable business and use that profit to take them out experience things and travel the trips that they will never forget.

Lesson learned:

“What got measured got improved. Where focus goes, energy flows.” - as Tony Robbins said. And that will bring magic.

Also please make it a ritual to thank your spouse, your family, your ride or die for supporting you if you’re like me, busy being a gladiator in the business world.

Syndication Story Time

(All names are made up but it’s based on a real story)

Mr. Wat got some good news - his offer on a 34 units, let’s call it - the Y deal, got accepted at the price he wants. This is huge! He has been offering on many deals for the past 18 months but no deal got accepted until this. His dream came true! 😇

However, Wat feels so stressful because now he has to raise fund to do that Y deal. Everyone is saying that it’s so hard to raise fund nowadays. 😳

He already started raising for his first deal, let’s call it - the X deal, where he talked to 200 investors and has 2 investors potentially invest with him into the X deal.

Mr. Wat decided to back out on the X deal in the middle of the raise.

He wants to back out on the X deal where he’s playing a small role so he can save his 2 potential investors for his own upcoming deal being the main person on the Y deal.

The Y deal got accepted which is a blessing now is making him breaking his promises with the operator and his partners in the X deal. 😬 

This is such a perfect example of “Be careful what you wish for”.

Ask yourself a few questions:

If your dream becomes true, how will you react? Are you ready for it?

Back to our story, Wat also decided that because he backs out, he should not pay his portion for the lawyer fees to do the paperwork of the X deal and save himself a couple of thousands dollars.

Now, that offended all his partners, who are more experienced than him but agreed to take him in to share the fees with him. They said they won’t recommend anyone working with him in the future.

If your dream becomes true, is it worth the journey to get there?

Funny thing is, one of his partner knows that Y deal pretty well. She even knows that Mr. Angel - one of her investors is willing to put the down payment on the Y deal because Angel is looking for a similar deal and wants to put his cash to work.

Plus Angel has the net-worth to guarantee the whole loan for the Y deal, so Wat could have just partner up with Angel and close on it without any problem raising fund.

This is an example of the zero-sum mindset:

“The 2 investors that might go to the X deal need to be saved for the Y deal.“

Instead of having a positive-sum mindset, Wat unfortunately has a zero-sum mindset.

Hence, Wat is struggling now while he could have got both deals done easily, if he just does what he said he would do, and his partners did not lost their trust on him.

The syndication world is small, there are about 20,000 syndicators in the US. And they are probably the most active group in networking.

Everyone knows everyone eventually.

Lesson learned:

If you can just learn one skill in business, it’s the people skill:

• Listen, understand and respect people.

• Do what you say and say what you do.

• Always leave people better than when you found them.

Again please forward this newsletter to someone you think might enjoy reading this.

Cheers,

Sophie

Disclaimer: I am not a CPA, attorney, or insurance advisor. Nothing contained within this website, emails, videos, or other content from me constitutes financial, investment, tax, legal, insurance, or other advice, nor should anything contained within this website, emails, videos, or other content from me be relied upon for making an investment or other decision. You should consider obtaining relevant and specific professional advice before making any investment or other decision. If you need such advice, please contact a qualified CPA, attorney, insurance agent, or financial advisor. Linked items may create a financial benefit for Sophie Nguyen.