- 02:56 – Phil discusses how an introductory book like Rich Dad Poor Dad can completely change your mindset and way of thinking.
- 04:47 – Phil shares how books on self-help and business led him to pursue real estate investing after his incarceration.
- 11:04 – Phil emphasizes the importance of being mentally tough and consistent when starting a real estate business, as success may not happen overnight.
- 13:28 – Commercial real estate is evaluated based on the income a property generates, not just its sale value like residential real estate.
- 19:12 – Even after developing a team, it’s important to remain hands-on as the business owner to ensure things stay on track.
- 20:49 – Phil stresses that investors are attracted to entrepreneurs who are willing to roll up their sleeves and do the work, not just rely on others.
- Contact Number: 678-478-5352
- Website: https://www.rawfunds.com/
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- Youtube: https://www.youtube.com/channel/UCxoSuynJd5c4qQ_eDXLJaZA
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- Linkedin: https://www.linkedin.com/in/cmelette/
CORWYN:
Do you want something more? More meaningful moments, opportunities, deeper relationships, and memorable experiences? Do you want to make a difference? If you said yes to any of that, a career in real estate could be the opportunity you’re looking for. Guiding people through one of the most important decisions they ever made. The purchase or sale of their home can be both rewarding and lucrative. Exit Realty’s revolutionary compensation model, training, and technology provides you with the tools you need to start and build your successful real estate career. Call Exit Realty Lowcountry Group today at 843-619-3005, that’s 843-619-3005 or visit join.exitlowcountry.com and make your exit today.
Good morning. Good morning. Great morning guys. Welcome to another fabulous episode of Exit Strategies Radio Show. Hey, I am your host Corwyn J Melette, broker and owner of Exit Realty Lowcountry group in beautiful North Charleston, South Carolina. So if this is your first time listening to this show, you sir or ma’am are in for a treat, because our mission here is very simple. That is to empower our community through financial literacy and real estate education. We’re legacy building. So I’ve been taking a little bit of, if you will, poetic liberty. And I’ve been sharing with you all, for the last several weeks, if not several months, that we are continuing to bring the best guests with the greatest impact and stories to our show. And today is no different. I’m super humbled. I am honored to have this gentleman with us today to talk with us about his journey, where he came from, where he is and most importantly, where he’s going, and how he is willing to take those of us who are up for the destination along the path with them. So I’m honored to have with us today none other than Phil Brooks with Raw Funds. Now look to hold on before Phil get started. Now I got to take some of y’all back because when he said to me raw funds, I said wait a minute. I said “R A W”? . said, Yeah, that’s it. I said, Man, I just took me back to Big Daddy Kane. We got to welcome him today. Because he is coming in raw. Today. Little we got to make this happen. We started from the basement, and we go into the attic. That’s what I’m talking about. Phil, how’re you doing today, my man?
PHIL:
Man, I’m doing awesome Corwyn. thank you for having me on the show. And that was an awesome intro man. I just gotta give you that much.
CORWYN:
I appreciate it, man. I really do. So Phil, if you don’t mind, high level overview. Who you are, your company, and what do you guys do?
PHIL:
So, I’m Phil Brookes name in the company is raw funds. We also have another one which is BlockForBlock. But what we do is we buy multifamily commercial real estate properties. We currently own over 80 units and closing on another 150 in December.
CORWYN:
That’s a good problem to have. Yeah. So look here, he sound a little bit like, well, I’ll know. But yeah, that’s a good problem to have. Right? They feel. So Phil, what got you into this space?
PHIL:
So this started long ago, my dad used to build houses from the ground up, and he lost his company. But I always like how he used to take just a piece of land and turn it into something beautiful that people can actually have shelter and live in. So he was doing as a little kid, he actually lost his business. He turned to drugs to cope with it. And that was something I knew I didn’t want to do just to see the impact it had on him. It did have a negative impact on me. I don’t blame them because every decision I made was because of me. And I did find myself doing other things that landed me incarcerated. When I was there. I used to read books, a lot of books, to come home to do the same thing. And then one day correction officer threw a book on my locker. I have no clue why. And it was Rich Dad, Poor Dad and it changed my life. It changed my way of thinking. I started reading all self help books. Napoleon Hill, I just started reading a lot of books on self helping businesses.
CORWYN:
So you became a student of a positive mindset. Richest Man in Babylon the other day has laid out and paved the way for some of the most successful people in the world just being blown about it. I mean, it has. It shares a story, it makes people process differently, their thoughts, which means if you process your thoughts differently, then in turn, your actions are going to follow, and they’re going to be different as well. So we’re not going to continue to do the same thing. So that is amazing. Man, Rich Dad, Poor Dad, though you said change your life.
PHIL:
Because I didn’t know the strategies. We wasn’t taught this. I was taught, because where I grew up that you was taught to get rich or to create wealth, you had to play sports. And when I read that book, it was like, just the blueprint. It just finances, you got to learn your finances. So buy assets and creates wealth. That’s what I wanted to come home and do. And the good thing about the story, not only did I change my life, when I came home, my dad changed his because he said, When I heard the difference in you, when you came home, I wanted to be different. And he went cold turkey, it was over 15 years ago, me and him have been partners and friends on different stuff since.
CORWYN:
So you just took me through– So look here, for whatever reason, I’m on a hip hop reference today. What I heard you saying is that, from my block, where I’m from it is Get Rich or Die Trying. We got some 50 on that. So then we’re gonna take that thing a little bit further. And then you found this book. And you realize, wait a minute, this is the blueprint. So look, now we don’t make it into Jay Z, you got the blueprint. And now you started to impact everything and everybody around you by leveraging the mindset that you were able to develop that is beyond reading. So for our listeners, guys, I want to take this bill because it’s beyond reading, you can read things, people read the Bible all day, but they don’t know anything. You got to consume it. You got to ingest it, you ingest it, you consume all of this information, change your thought process, how you acted, reacted with money, learn how money moves. So man, I’m gonna tell you this, Phil, and I get excited about it. So look, I’m gonna stop talking, because I gotta make sure that I listened to hear from you. But I get super excited about this stuff. Because I tell people all the time, money is currency. That means it float. Sometimes it has a wave, this at times when it is a crest, there’s times when it yet crashes. But regardless, money flows, it moves. And the problem is we want money to be stagnant. We want money to remain with us. Like I got you, baby, come on right here. But the problem is your money wasn’t meant to stay, which it was meant for you to be a conduit. Now what you got to learn is how to divert the money. People don’t like the way the river run, what they do, hold on, let me block this. Let me cut me another path and divert that to me. So you got to learn how to move money. So money flows to you? Yes, see, it’s got a means to hold. I like to say the same thing, right. And then it comes to you. And what happens when you become a greater conduit? When money and more money flows to you ain’t it about you retaining because you ain’t building the wall and you making a lake per se? Well, even if you’ve got a lake, they still got to be something that contributes water to it. And when it overflowed, waters got to be able to come out of it. So currency, money works the same way. But man, I didn’t want to steal no thunder from you. So that was a driver for you to make an impact when I heard to make an impact and a positive impact on your family. And it sounds like you’re accomplishing this. So why real estate?
PHIL:
real estate is one of them assets where even if you buy high, if you got a chance to hold on to it is going to appreciate eventually is going to start creating wealth for you. Long as you go to at least buy soda right that later on down the line is worth a lot more. That was one of the asset classes that does that for you. And then a many that do that. And like I said, since I was younger, I used to watch to get built in watch the rich people buy it. So that was one of the things I wanted to do. So I started the first time I bought my first piece of property. And this is when I realized when you put in more than you’re getting paid for. Eventually it pays off, right? I’ve never had a job before, Corwyn and I came home I got a job. I was making $9 an hour because I wanted to bring income in and buy property. But I didn’t want to do it the way I used to because my mind was totally different at this time. Totally different. I won’t say at this time, even though it has elevated since then. But it was just a whole different mindset, friends looking at you different everything. And I used to learn everything About this job, so it was in the factory machines, whatever. And I used to follow the maintenance guy, even though they were getting paid $30 an hour, and I was only making nine, I used to follow him around and learn what they was doing. So when our line went down, guess what they didn’t have to do, they didn’t have to come to our line, because I already knew what to do, they could go to another line, get that line and run it. Because I’m gonna get this line running without having to come over here. Within 90 days, I was promoted to salary $70,000 a year. And now I could go to the auction and buy me some property now making enough income to put away because you got to put something away for us, even if as pay yourself first. And when I say that’s the truest statement, that’s the truest statement. And I made sure I did that. And that first year, I was home, within 10 months, I bought two properties. And they were single family at that time when it was from the auction. And it was a learning experience. One of them. So as I bought it a month later burned down to the ground, no assurance.
CORWYN:
I almost fell out my chair, almost laid myself down, hold on, prostate and look is ready to give up the ghost man. Oh, man, but that was a learning experience. So go right here from there. Yeah,
PHIL:
the one I held on, I held on to it, I ended up selling it for a profit. And my goal was to buy at least one a year for 10 years, and had 10 properties. And that replaced some of the income I had coming in, right. So I can eventually do it full time. And this is when I started digging deeper, and I got a mentor. Now that’s the power of masterminds, and being around people who is doing what you want to do. And he said, Phil, why buy one property year for 10 houses, when you buy one building with 10 units already there. Now you already exceeded your your goal of 10 houses for 10 years, one purchase. So let me dig deeper into this multifamily one building 10 unit thing, right, and I joined another mastermind, because I had no clue how I was gonna buy a million dollar property. When I went and got $1,000 in the bank, I’m living check to check, I had no clue how I was gonna be buying these properties. But I still took that money income and invested it in myself by joining the mastermind. And being around people who were doing what I wanted to do. That’s when I joined. I don’t know if I can say the program on here or not, on my affiliations with it. It’s called the Deal Room. Unique Smith and JD Smith is the ones who run that. And when I joined that I learned how to underwrite a deal, because you need to know when you got the deal, how you gonna know what to buy, if you don’t even know what the deal is. And underwriting is basically plugging in the income, plug it in expenses, and also plugging in performance numbers to see if this property is worth buying. If it’s going to cash flow and not when it’s going to cash flow. And what commercial properties it goes by the income is bringing in not by like residential, when you got to come around the corner. And if that house only sell for 250, your property only worth 250. Now, this commercial go by if you generate income, how much income you’re bringing in, and it goes by a certain market cap rate I have that gives you the value of your building.
CORWYN:
Exactly. And people miss that man, they missed that commercial real estate does operate differently. It’s not people oftentimes think, because I’m a practicing broker. And in the conversations that I have with people, oftentimes people think, but you got to have a separate license to do commercial versus the lights, you have to have a residential No, it’s all the same lights, you just have to have a different understanding and understanding on the commercial side is the deal is made by what the use of the property is if you’ve got a retail strip, and you’re running, maybe five boxes in the strip, then at that point in time, the rents make the deal if the base rents. So if you’re running camp, so common area maintenance or what have you, that doesn’t factor in the field base rents are making the the place profitable, then that makes a deal. And hey, this is a deal. Let me do this. If not, then not a deal. And let me go find something else that may work out to that. So what was the first property that you bought as a commercial deal?
PHIL:
My first property was 26 units in Dona Texas. And this is when I was still learning. So what I did was I found this property on the road, but I handed it off to a group and just took a small percentage. It was just so I can know what it was like to take a deal from start to finish. Once I learned it. My next deal was a 24 unit in the Arkansas and I took that to start to finish myself I found The deal, underwrote the deal. I negotiated seller financing. And then I raised 950,000 in 2 weeks to close it. Now where are from raising almost a million dollars for commercial property was unbelievable to me. I did in the two weeks, because I knew the numbers, I go so deep into learning how to analyze a deal, that I was confident when I was pitching it to investors who eventually invest in my deals.
CORWYN:
So what has been like, and I’m gonna frame it as a lessons learned, because it stuff is hard man, what has been like the lessons learned, as well as the successes experienced, that you’ve got to be a part of, on this journey.
PHIL:
One thing I’m gonna say, one of the lessons I learned, you got to be tough and strong, and look at things totally different. A lot of people just like in the market we just left out of it weren’t a lot of deals, Corwyn. The people because everything was getting sold overpriced because of the interest rates, and where the market was. And I had to look at it as just a few months ago, I didn’t even know what a deal was. I’m happy to be underwriting even if it’s overpriced. And eventually is not I used the Michael Jordan method, he wasn’t known for how many shots he took, he was known for the ones he made. Even if he took over 700 shots, he was still known for the ones he made. So I said, Hey, I’m underwrite and find how many deals as I can, eventually, I’m gonna make a shot, or I’m gonna work out. So that was one of and I’m be honest with you, I quit my job and went full time when I started multifamily. So my income was going down, I’m still learning, I still gotta tough it out, my wife and my hair like, Alright, when it’s gonna start paying off, you guys joining been doing this when the income gonna start coming. So it took a lot of mental toughness to understand that what you believe in, and what you put your mind to, it might not happen overnight, but the consistency of it is going to happen. So that was one thing, thank God, I have faith. And then the lesson I learned is trust but verify. And I say that is we had a project manager and this is on the second one a 24 unit I bought in Northwest Arkansas, he gave us a good price man, he was good man. Even the down to the bid. It was so detailed. So professional, so you just knew you was dealing with a good professional. And we’ll have meetings once a week with the property manager and the project manager to see how the project going and see how they doing at least enough to property. And I’m getting told one thing by the project manager. But the property manager is like man, you need to just come see you. And they work for the same company. That was funny. It was funny. That’s why I know this guy got my back and I went to go visit a property. They was doing a word. But they instead of odor and dumpsters right it was putting everything in the behind in the courtyard. You got other tenants that lived there, they came back er, to the courtyard because the contractor is just dumping everything out of the old property, the paneling off the walls putting in the courtyard. So that was one thing like what is going on. So I’m talking to him, he’s come to find out he wasn’t even showing up for the project. He was just getting pictures and video updates from the sub contractors that he hired out. So even though things may seem like it’s going according to plan, and everything, I say trust for verify, because we got set behind at least 90 days because of that, because we had to get rid of him because they wasn’t doing everything they were saying they was gonna do. We had to hire new contractors, now they got to come in, we got to do the bidding all over. So we lost a lot of time. So if you want to stay on schedule, and things happen, definitely in construction and things, there’s be delays.
CORWYN:
I appreciate that. What I just heard in that, Phil is that you still got to be hands on as you’re developing your team, you still need to be hands on. Once the team is developed, then things change. So you’ll focus and change and you can work on continuing to grow and multiply the business. So you also correct me if I’m wrong, but you’re actually starting to coach people along the same path now am I right?
PHIL:
Correct,, So I get a lot of people who reach out to me a lot and it’s people that are just like me, then no sports, nothing beyond sports or any like wow, you don’t and you got none of your own money in the deals like you raising capital. That’s really true. I heard people say that before but it’s really true. Yes, you got the credibility, yes, if you’re gonna have to put in 120% of sweat equity, if you don’t have to equity yourself and give your partners and your investors more than than they expected, it comes a lot easier. Put it that way
CORWYN:
That it does and people miss that. But I was something I know that you’ve picked up between Rich Dad, Poor Dad and then also getting over into the Cashflow Quadrant, how that money moves and the investors will come back to the business owners and the people that’s willing to get in and do some of the work in the trenches, because all they got to do is just make their money just grow, multiply. So Phil, how can people get in contact with you? So they can reach out? You have a website so you to get more information and connect with you on helping them to take a similar path?
PHIL:
so I have a website is called rawfunds.com. Also, it’s easier to get in contact if you can, I don’t know, I could put my number in here as well.
CORWYN:
Give it out. So all you listeners, guys, look, you go to our website, we’ll have Phil’s contact information up. So please make sure you if you don’t get it here, get it there but field going round number off, man.
PHIL:
Yes, phone number is 678-478-5352. I’m also on social media, all social media platforms. on Facebook. I’m just Phil Brooks, just plain Phil Brooks. Then on Instagram: I’mPhilBrooks. So then the two social medias I can also be found on as well, you could reach out.
CORWYN:
Awesome. So Phil, man, we have quickly gotten to the end of today’s show. So I want to say to you, I appreciate you taking time to be on here with us today. And sharing your knowledge and expertise and your story. Because it matters. It matters. So boss man again from bottom of my heart, man, I appreciate you being on the show with us today.
PHIL:
Thank you, Corwyn and thank you for letting me be and sharing my story on it as well.
CORWYN:
You’re quite welcome. So for our listeners, guys, this has been an amazing journey. But don’t forget, while the experience rests in the journey, the destination is still your goal. Y’all know how I feel? Ya know what I say? Ya know, I always put the two of those things together and I laid that track for you this way, which is I love you. I love you, I love you, and we’ll see you guys out there in those streets.
