Lawrence Dunning from Mainstreet Real Estate Group is a financial trader turned boxer turned MMA fighter turned top real estate broker in Chicago. He founded his trading firm at a young age and walked away to pursue his goal of boxing eventually winning the Golden Gloves. In our interview Lawrence talks about the discipline and focus it takes to be successful in real estate, finance, and sports.
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D.J. Paris 0:00
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Hello, and welcome to another episode of Keeping it real, the largest podcasts made by real estate agents and for real estate agents. My name is DJ Paris. I am your guide and host through the show. And today in just a moment, we’re going to be speaking with Lawrence Dunning. Before we get to Lawrence, I want to remind everyone to think of a real estate professional that you know that could benefit from hearing these interviews with top 1% producers and pass along the podcast. How do you do that couple of ways. Number one, send them our website which is keeping it real pod.com Even if they’re not podcast people, they can listen right on our website to every episode we’ve ever done. Also, if everyone could rate us on iTunes or Google Play or Stitcher or Spotify, whatever podcast directory and app you use give us a rating let us know what you think about the show that helps our visibility as well. And lastly guys, please follow us on Facebook we can find email@example.com forward slash keeping it real pod why? Well not only do we post all of our episodes but we do behind the scenes live video recordings. So if you want to watch me record an episode in real time and not wait a couple of weeks for that’s what it’s a long it takes us to produce the episode before you can hear the audio you want to watch it live as we’re doing it we do it right there on Facebook and we also post an article too every single day that we find online dedicated to helping you grow your business so we try to provide so much value on that Facebook page that you’re gonna love it so follow us again facebook.com forward slash keeping it real pod and now on to our interview with Lawrence Dunning.
Okay, today on the show, we have Lauren stunning from Main Street Real Estate Group. Lawrence was born in the UK in London. He graduated with an MBA in finance, eventually settling in Chicago, at age 24. He set up his own trading company, which he ran for the next seven years. At age 30. He decided to step away from business to pursue some athletic goals actually spent five years doing just that. In particular, he has done MMA fights, he’s on 10 professional MMA fights. He has his black belt in jujitsu a number of other accomplishments physically as well. And then he’s become convinced during that time about the real estate investing model. And he bought his first investment property, which was a commercial strip mall, and got his broker’s license five years ago, and has been a top 1% producer for the last three years, which is an incredible feat to do that quickly. And he’s used the same principles that to build both a successful trading company, and now a successful real estate broker business. So we’re excited to have him on the show. This is a real treat for us. Welcome to the show, Lawrence.
Lawrence Dunning 3:55
Awesome. Thank you. It’s a pleasure to be here.
D.J. Paris 3:58
Thank you, I would love to learn about how you made the switch from being a trader and having that company, you know, into real estate, why the switch? Obviously Chicago’s a huge trading market, as you know, but why the switch? I know a ton of traders that have done that. So I’m really curious to know, how you got involved
Lawrence Dunning 4:18
was a trading was just such a it’s such a lucrative business. And like you said, the Chicago market is sort of one of the epicenters of I was an option trader. So one of the top, you know, option trading centers in the world. And so I was I was trading and actually I got a credit my my mentor and good friend Moe, who owns my company. He and I met over a decade ago and we both had dogs and we were we both on kind of a late schedule. So we’ll be out walking our dogs and we’ll just be talking. And so Moe would always be talking about oh, there’s so much money in flips and things like that. And this is this is a decade plus AGO A long time ago, but we never we never really got going on the flips but then he I stepped away from trading. I was you know in pair trading for a while. But when I when I stepped away, and I was kind of focusing on some personal goals, I would still trade a bit online and I was still, you know, trying to make money. And then the whole, it’s so interesting because you assume, or at least I did when I was young, if you’re doing something and you’re good at it, you’re gonna be able to make money by doing that for, you know, for the foreseeable future. But I didn’t that, you know, high frequency trading came. And there’s very, very few people that I knew back in the pit that are still trading. It’s such a tough business now. So the, the algorithms took over. And exactly, so I was kind of finding that, but I was still kind of struggling trying to make a bit of money. And then Moe was who’s a broker at the time was like, you know, what about, we’ve started talking about just investing in real estate. So the first thing I did in real estate wise, aside from buying my condo, when I first moved here, was I bought this commercial property. And then as an owner, and a landlord, I really started to learn about the business model. And I think what I really want to kind of explain to people is, I thought I knew about money and finance. So I come from, you know, I have an MBA, like you said, and you
D.J. Paris 6:07
do know about money and finance, right? Trading, traders background,
Lawrence Dunning 6:11
but exactly, but what’s so crazy is I think there was a huge blind spot I had, and I really think because when I look back, I think not, not a lot of people have, you know, a good, a good degree, and then they start work and they don’t really, you know, they’re not really that curious about learning or anything, but I’ve been I’ve been obsessively reading and learning since I was a kid. So I think Man, I had not only do I have an MBA, so I have the the the degree, which I think in practical posts is kind of worthless personally. But I also also read, you know, dozens and dozens, dozens of books on finance, and entrepreneurship and reading about these, you know, these really high achievers. And I think through all of that knowledge, the real estate model, it barely was mentioned. So I only kind of found out about that from a practical perspective. And largely thanks to moe, like I said, and then the more I learned, and the more I tried, like, I can even if you if you said to me, Hey, what’s a great book to read for real estate investing, I could give you one or two that are okay. But there’s still not great, there’s not really there’s not really something out there. Because it’s just the problem is, is it’s so specific, you know, if I, if I was going to write I’m actually I do want to write a little ebook on real estate investing in Chicago, but I’m not going to pretend to know about other cities, and I’m not even gonna think about other countries. And even in Chicago, you know, you’re so specific this street, that street, this type of building, that’s I believe, everything is so different. I think that’s why people just don’t talk about it. You know, they have this when you do when you do, when you study finance, this is a cookie cutter thing. They say, Okay, if you’re young, you want to put 70% Your money in stocks, right? 25 and bonds and 5% cash. And then as you get older, you’re just switching the ratios, that no one no one talks about investing in real estate, because they don’t really know how you know, it. Most of these programs are very uniform. So you’ve got the same MBA program in Shanghai, in London, in New York, you know, in Sydney, and, and you can teach the same principles with stocks, anyone can open up an E trade account and trade the same things. But it’s with real estate, you really need somebody on the ground who’s just a master a certain area. And even he doesn’t know more much more about about anything else, but just his areas, both films, I think, I think it’s just so interesting, that kind of coming to this realization, but the long way round, I guess. So So, go ahead. No, I was gonna say so once once I started, so it was all kind of happening at the same time. So I bought this property, I thought I was making good money, income from the property, and then trading was getting tougher and tougher. And then I was at a crossroads where I was thinking there’s no point letting go trading was very, very hard for me to do because, you know, I made in a day what I in trading what I made in my first year of real estate, you know, what, where else can you make that crazy money, but the problem is, if you can make it that easily, you can also lose it that easily. So by letting that that was a very tough mentally bridge to overcome, but I just I was so convinced with the real estate model, and that I kind of had an idea that trading wasn’t going to come back it was just going to get harder and harder to make money that I decided if I was going to be a real estate investor, I should I should get my license and I should just learn more I should be on the ground and I should really learn the city. And so that’s basically what I’ve done the last you know, six years is I’ve just been trying to do what pretty much what every broker does successful broker, but I’ve also kind of focused a lot of my business on the investing side because that’s more of my passion. And it’s not it’s not that I went into this trying to find a niche the niche almost found me
D.J. Paris 9:40
so I just had a huge coughing attack. So we just we had to pause for a moment so apologize for the for how disjointed this probably seems, but I think that’s really important. And I bet you also as now a broker are probably also really and it seems to be because we’ve had and I know that you’re not just an investor, your traditional broker you work with buyers and sellers, renters, but also investors and you yourself are also an investor. And I’m always shocked at how many Realtors do not service the investment market. And also aren’t investors themselves. And I imagine that blows your mind as well. And I know that’s a huge passion of yours is making sure that people understand residual income and and why real estate investing can work. And yeah, and why it’s, you know, the Uber richer, of course, as, as you were, have explained to me, uber rich are doing that. But it’s amazing how many brokers themselves really aren’t that skilled at knowing about investments.
Lawrence Dunning 10:37
Right. And I think but I think that’s the problem with, I see this with a lot of new agents, is they kind of, they’re kind of scared to do everything. And I think the principles of real estate applies, it applies to everything. So I get I get questions sometimes, Oh, do you do commercial real estate? Do you do this, you do that I do everything you know, I’ll help a friend get a rental, I’ll help, you know, multi million, million dollar investment property for commercial property, regular two to four unit property, a condo, it’s all the same, the principles underlying real estate is all the same. So I think people need to stop being worried about commercial property, residential, it’s, of course, there’s a few subtleties, but the principles are the same. But I think there’s there’s some statistics, I don’t know the exact is it 45,000 licensed agents in Illinois, and there’s some huge amount of them that don’t even own the home they live in. And then, you know, the ones that obviously own the home they live in, a lot of them don’t have investment properties. So it’s definitely easier for me to deal with investors, because I can explain, you know, that, Oh, you know, this building is like, you know, like the building I bought last year, and the reason I bought it is because of XYZ that’s why it’ll be a good investment. So I definitely have that going for me, it’s a bit easier for me to explain. But But again, this stuff is not, it’s not rocket science, it’s pretty straightforward with investing. Once you once you know, the formulas, you know, to analyze these ratios, you know, the cash on cash, return the cap rates and things like that.
D.J. Paris 12:00
Yeah, it is always remarkable to me that brokers will even become top producers in traditional buyers and seller environment. And then the moment an investor comes to them, they’re really not able to service that. And that’s okay, if they actively choose not to service the investor market, because it is a different clientele. It’s just a different process altogether. But I suspect a lot of times, it’s just because they haven’t put the time in to really understand what an investor’s needs are how that process works. And it takes years to under to get that knowledge. But it’s also something that you can start today. And then a year or two from now, wow, the ability to be able to provide those services are, are so important, because otherwise you’re going to be turning away business. And again, if you choose to turn it away, because you don’t have time, that’s great, but I think it’s a lot of times just lack of knowledge.
Lawrence Dunning 12:52
Right. And I think that’s a great point. Because the the market, especially in Chicago, we basically have a decade plus run a very stable and slow and steady growth with the stock market’s done great the last 10 years minus the last few weeks. But the key that the agents today have spoiled, right? A lot of them haven’t lived through the last recession, they haven’t seen. So when businesses good, I guess you don’t have to take all the business you can kind of pick and choose. But we are in some I mean, there was a great graph that I put on my LinkedIn a few days ago, we’ve had five decades of interest rates coming down. So I think the foreseeable future, we’re gonna we’re gonna stay in this low interest rate environment. And that the big thing with that is, if you have money, in my opinion, you only have two options, because Because bonds doesn’t pay you anything. You know, precious metals aren’t really going anywhere cash, you’re eroding inflation every day. So the only the only options are stocks and real estate. And the thing with the stock market is at some point, you know, even before the last few weeks, I was saying listen, I don’t know when it’s going to happen. But at some point, you don’t have these 10 plus years of runs, you know. So I think that it’s it is important if you’re if you’re dealing with people with money to educate them on the real estate investment model, because it’s that, for me is the only good alternative to stocks. And I think it’s way like I don’t know, I barely have any stocks. A few lingering in one of my trading accounts, but in the thing with the stock market. That’s the big difference, I think with the stock market and the real estate market is and it’s very hard to even talk about this with you because like we said at the beginning of the show, I talked about the stock market, the luxury condo market in Manhattan, am I talking about multi units in Chicago? Or am I talking about single family homes in you know, la suburbs? It’s all different, right? So when I throw out these statistics, they obviously are averages in general. There are generalizations but I think we there’s there’s something like a quarter of the volatility in the real estate market that there isn’t the stock market. And I mean, you’ve seen that with this this last few weeks is kind of shown some of the frothiness and the volatility of when, when there’s fears I don’t have you know, I don’t have an $800,000 condo suddenly selling for 600. In the last two weeks, you know, it’s not it’s not the same. Right? I think that I think your your volatility with the right building is less. But also I think that the big thing that people people just with stocks, I guess you have two things, right you have the the appreciation and you have dividends, but we’ve been in an environment where the dividends is is relatively low for most stocks, right? The big the big thing was, when I talk about the right type of real estate, your cash on cash return should be close to if not double figures, double digits a year, it should be close to that. So maybe it’s 8%, maybe it’s 10%. But that’s not well, that’s
D.J. Paris 15:35
the thing, too. And I mean, look, you know, last year, you know, my index funds were up 30%, because they, you know, the market was up. And that’s a great year. However, I would trade the volatility of that for a seven to 9% return, year after year, because I know and I’ve always felt this way about money that the best way that I can grow my income is by working. And then I just want a more traditional, you know, a traditional return, that’s not necessarily guaranteed, but that has a lower volatility, because that is something I can’t control. So I would trade the 30% returns for like a 10% average return over time, in a less volatile environment, which would be real estate investing, if done correctly.
Lawrence Dunning 16:23
Exactly. But that’s a great point. So you, you highlighted the volatility, most especially when you’re young, you don’t mind the volatility, I’m 40. Now, I don’t really want crazy volatility. But that’s only one half. So to use your example, if you made 30%. Last year, on your stock portfolio, you had a great year, and you only made 10% on your real estate, the bid, the big difference between the real estate is you’re you’re buying it typically as an investor with 25% down. And if real estate is averaging even through the biggest 2008 2010, that was the biggest real estate correction we’ve had in a century, even through that you’re averaging about 5% return a year through real estate. Now, because you’re only buying with a quarter down that 5% is actually 20% on real money, then then that’s when you start making big money, you have the 10% cash on cash return, you have the 20% because of the leverage in a very four to 5% appreciation period. And then on top of both of those, every month, you’re paying down your debt, so your your equity is increasing. And then on top of all of that you have all these tax benefits. So when you put that all together, a slow and steady, you know market that’s increasing four to 5% a year, your cash on cash return to the right property is closer to 30 33%, then you’re doubling your money every three years. So that’s kind of why in a nutshell, real estate is the secret of the ultra rich.
D.J. Paris 17:44
And I really would love to point out that these are conversations you have with your traditional clients as well, your traditional primary residence buyers and sellers, you know, you have this knowledge, you have this passion for it, and it works for you personally. And I just think how much more powerful and important does that make you to your clients versus just Yeah, I can help you buy or sell this home. Obviously, we have 40, some 1000 realtors, and actually, the total number of Realtors in Chicago, including the servers is over 40,000 in and of itself. So it’s like there’s plenty of people that can help you buy or sell a home and obviously many of them some of them do that much better than others. But I love the always the you know, the idea that you’re also able to say, Hey, by the way, you should really consider and I would love to get your perspective on this. A lot of people think their primary residence is an investment, Mike my my thought is maybe it might be you might get lucky. And when you sell it, it might be worth more but it’s not really an investment because it doesn’t really produce income for you. I’ve always thought investments should produce, you know, some sort of regular income. But this is where real estate investing comes in. So,
Lawrence Dunning 18:53
but I would love to go ahead I’m sorry. No, I was gonna say talking about your your primary resident being an investment. I bought my first condo in 2004. So I got my first bonus from my trading company put down 20% I bought my condo, fast forward 16 years, it’s probably it’s probably appreciated. I paid 300,000 I think it’s pretty worth about 340. So I mean, you’re talking absolutely negligible appreciation in nearly two decades. So but I knew that going in because I was living in Australia once my company put me up in Streeterville they put me up in a rental I got my first month I moved one blocks. I like the area. Yeah, so I knew when I bought it then even though I didn’t know anything about real estate, I knew that that at the time was the highest price per square foot in the city and buying a one bedroom condo. It’s like how much upside you’re going to get. But I think so that’s kind of what I try to explain to people for you for your primary residence. Of course you shouldn’t be it shouldn’t be a bad investment, but you shouldn’t really look to make any money off it. That shouldn’t be the way the way I see and I would tell someone is listen, you want to live where you want to live and Now, if you want to if you’re a young person, and you say, Listen, I can deal with living somewhere, I don’t want to live to buy a multi unit with an FHA loan, why just put down a little bit as an investment. And then after one year I can, I can move out. That’s a little different story. But I didn’t really want to go that that route. And I guess at the time in my early 20s, I didn’t even know that was an option. So I think that you can kind of you can take advantage of what, what, what is given to you. So right now, we’re in a very interesting for FHA loans, you’re paying about 3%. So it’s insanely cheap. And you can you can put down and say, if you can find a four unit building, and the FHA limit is 70709, I think it is, and you have to put down three and a half percent, you could, in theory, have the seller, sell it to you for 735, give you 20 26,000 Cash Back, use that as your down payment, you almost buy it for nothing. The problem is finding those is like finding a unicorn in this environment, because they haven’t raised the FHA rates for you know, a decade plus. So the problem you’re going to have is, of course, I can find anyone a building like that, but it’s not going to have good numbers, because it’s going to be much it’s not going to be recently rehabbed in a good area with good rents and good numbers. You know, I do find them occasionally, but they’re very, very, very hard to come by. Yeah,
D.J. Paris 21:14
I would love to switch gears because I, we talked about this very briefly, in your intro, and you are a very physical person, you’ve competed. You know, in MMA fights. Can you talk a little bit about the discipline that goes into you know, you stepped away entirely from business to pursue these goals? Can you talk a little bit about that? I just find that so fascinating.
Lawrence Dunning 21:37
Yeah, for sure. So what happened was, I think I always knew at a young age that, like I came, I came from an English system. I grew up in England, I went school in England, coming here realizes how good the US sports arts sports systems are in, you know, high school and college in England, unless you’re a really, really good soccer player, they have really good programs for you, maybe a little bit of rugby, the rest of the programs are kind of nonsense. So I was I played soccer growing up when I was a kid, I wasn’t good enough to be the elite level. One of my, one of my good friends played professionally, which was awesome. But I so I always dabbled in things, but I never really had an outlet. So when I came here, I was trading and it was very intense. And a lot of the people when you have a job like that, with so much intensity, you need some kind of release. So a lot of them went down the path of drinking and drugs and that was that released. And I started boxing. So I went into this boxing gym. And there was a lot of you know, famous UFC fighters in there and it was kind of one of the one of the best jujitsu and boxing gyms in the city at the time. Now there’s a lot more back then there was there was only really one. And so I remember I walked in and my my, my future boxing coach said to me, Oh, you got the door of a fighter you should boxing The Golden Girls. And then I was like, oh, that sounds kind of cool. So I started so I started when I was treating my life was literally just what worked in the trading pit. Take take a nap in the office for a couple hours because a very early start thing goes straight to the boxing gym, come home and go to sleep and just rinse and repeat all day. So I did that I won the Golden Gloves I had I had a few disappointments i i fought in the for the state Illinois state title, which I lost. And I had a great boxing career. But I got to the stage where I was like, Okay, I’m in my late 20s. I’d been doing jujitsu a little bit. And then May was becoming really popular. And I realized, I have my whole life to make money. But we have these windows of opportunity that come and go. And I realized I was I remember I turn 30. And I haven’t one thing I kind of backtrack on for for advice for new agents is when if you if you want to start creating wealth, it’s not just about investing. But it’s also you have to be saving money too. And one thing the reason I became very wealthy in my 20s is because like I said, I bought my condo, my first bonus, I didn’t have a car, I didn’t have all these crazy expenses. I took a few nice trips, that was my treat, but I wasn’t lavishly spending money. I knew people that you know, renting, renting these nice cars and going to the clubs with a Lamborghini and getting tables is I wasn’t into any of that. So as I was making money in my 20s my net worth just kept going up going up going up. And then I got to the stage where I was lying in bed one night, I couldn’t sleep and I got up and I was like now how much am I actually worth and I started to look at my trading accounts and my trading seats and all the assets I had. And I was like, Wow, I’m actually actually worth quite a lot of money. I’m gonna step away I had kind of lost a bit of the passion for for trading. And I really seen the signs it was becoming harder to make money. And I thought, well, I’m 30 years old as a male athlete. You don’t have too long you probably have, you know, five years you’re seeing people go into labor now. But you know, for me, I was I got pretty good five years. And I thought this is the chance if I want to actually do something. And my big my big thing that I always live my life by is there’s a great Les Brown quote and he talks about do you want to be that person at your dying bedside with the angels of your potential all around you saying like we came to you you had all these talents and potential and you wasted us And it’s one of my favorite, my favorite speeches it gives me goosebumps when I hear it. And I’ve always been driven by that fear. I’ve been driven by a fear of being this old man with grandkids on my feet. And maybe maybe I have a nice house and I have money, but I have these regrets. Why did I do this when I was 25? What I do this when I was 30, you know, so I’ve always been driven by the fear of regrets and having to seize opportunity. So that’s why I was like, You know what, I’ve just got to jump in and do this. So it was it was, it was such a great period of my life. And it was so hard, because a lot of a lot of people. I think, you look at what it takes to succeed in athletics. I don’t think I had any natural abilities other than grit and determination. And I think that it was a really great period of my life is incredibly hard. Physically, I just think just, I had this thing in my head, I was like, Well, okay, I go to work, I trade all day, I take a nap, I go to the gym, it’s like, if I don’t have to get up at 5:30am and go to the trading floor, I’ll be able to sleep in I’ll be able to train to three times a day. In between the training sessions. I’m gonna be learning Spanish learning Portuguese, do all these cool things. Yeah, I didn’t realize that when you’re training two, three times a day you are so zonked. You are just trying to nap or like just, I don’t know, space out for a few hours between sessions. It’s so exhausting. But it was such a great period. Because I remember right at the end I had I’m fighting such a funny thing. It’s exciting because there’s so many variables. And I remember, I never felt like I was performing to my abilities. And it was always very frustrating. And I had one fight was my penultimate fight. And I felt like Actually, everything came together. And I showed my potential and I was very happy. And I was like, I have one mole. And then I was like, Okay, now it’s time to you know, close this chapter, but I don’t have crazy injuries and brain trauma, you know, it’s time to close it. But the ones the one thing I the one mistake that I made is during those five years, I assumed that when it was done, I could do something in trading and keep making, you know, a lot of money, right? It combat door of, well, I took the door of the the doing something athletic, but I still had the time and youth and energy that the door on the finance on the trading that completely closed. So that was all kind of happening at the same time when I bought my building during that time. And that’s that was kind of what made the decision well, okay, I’m in my mid 30s, what the hell am I gonna do now, you know, because I was, I probably made every mistake in the book, I was way over leveraged in stocks through the last stock correction. And I, the one good thing I guess I did is buy that property. But I assumed I’m very confident. And I know that I always assume that no matter what I do, I’m going to make money, right? I had that in the back of my head, you have to have that confidence. So instead of what I should have done during those five years, I’d say less than, like, you know, you’re dabbling a bit in trading, you’re not really making that much money. But I’d got used to a certain, and I just, I’m gonna kind of contradict myself, I wasn’t big on buying cars and doing all this stuff. But I did have a certain expensive lifestyle while I taking lavish vacations and things like that. So when you don’t work for five years, so you don’t make too much money. You’re you’re spending, you know, a reasonable amount every year, your net worth is taking a hit. And then right at the end, I started trading a little bit more online. So I was like, you know, I’ll come want to make some good money. And I was trading grain options. And I was having a good year. And I was like, You know what I had a big position on I was like, I’m having a good year. But I don’t want to have a great year, I want to make more than I’ve spent the last five years I want to crush it. And I put a big position on. And I thought I was right. And I lost every day for two weeks straight trading days, it went against me when against me went against me, I finally got to a stage where I woke up and I said yeah, I’m gonna, I’m gonna lose everything. If I keep this position, even though I think I’m right. They call it in trading, they say the market can stay irrational longer than you can stay solvent. And that’s exactly what happened. I woke up and I said, if it turns against me today, I’m gonna get out of everything. The first five minutes of trading, it went against me, I got out of everything. And then 10 minutes later, reverse and I would have made a million bucks. So it was that was that was a very frustrating and painful experience. And that’s and since then I’m like, You know what I just kind of what we were talking about, I don’t want that volatility in my life. You know, I want to have I want to have, I’m not impressed by if someone says, Hey, I’ve got this idea Lawrence, you can make 100,000. That doesn’t impress me as much as some of the says, Hey, you can do something, it’s going to make you $1,000 a month for the rest of your life. Right? That’s when I when I realized that, you know, that’s why for me at that age and with my personality, I realized that the real estate model is 100% Something I want to work on. So all these things we’re talking about, they’re all kind of linked. But I really think the lessons from from that story to anyone listening is you have to take opportunities. So for instance, what I try and tell my one of my partners that I work with a lot, John, is business is good right now, you know, we’ve had like we said 10 years of low interest rates stable, the economies that are creeping up, you know, everything’s nice and stable. People are doing things people feel wealthy because of the pensions and everything’s up. So I said you’ve got to you’ve got to be absolutely crushing it and hustling Now, because when times are bad, it’s going to be, you know, four times as hard to make the business. So I think with that story, a couple of things that I guess lessons that I learned that hopefully, people won’t make the same mistakes as me is, you can’t, it doesn’t matter how good your one revenue stream is, one revenue stream is not enough, because life can always get in the way and change, you can be making half a million dollars a year from one revenue stream. You. I think the statistic is the average multimillionaire has seven different streams of income. And I think that you should definitely, definitely add a few more streams to that to that, that one revenue stream. And the other thing is you just have to take opportunity when you have it, you know, if it me as an investor, as a buyer, if there’s no inventory that I like, with with the wrong returns, I’m just gonna sit and wait, maybe I have to wait six months or five years. I don’t care. I’m not I’m not just gonna force it. On the same token, right now, you know, interest rates are so low. If banks would give me these loans, I would take $10 million of debt today. And I would invest, you know, because it’s, it’s for me, it’s free money. So I think, right, that’s, that’s the one lesson I took from that, I guess, take take opportunities when you have it.
D.J. Paris 31:07
Make make hay while the sun shines. Right. Exactly. Yeah. So So I want to talk about the discipline that it’s take, you know, that that you have demonstrated throughout your entire career, right, you started a company very young, you had your MBA, so you had the knowledge, but obviously with MMA and other types of physical activity, boxing discipline, is everything, along with business as well. Can you talk about what it takes to be successful as a realtor discipline wise?
Lawrence Dunning 31:38
Yeah, I think I think the first thing is you have to manage expectations. So I remember when I first had some friends, that Mo was one of them. But some friends talking about Gary Vee, and I found them a little bit annoying. I didn’t really know too much about him.
D.J. Paris 31:50
Well, he is a little bit annoying, but Well, it’s also very smart. And he knows what he’s talking about.
Lawrence Dunning 31:56
But I recently a few months ago, I think I put on my on my Instagram, I put a podcast with him and the Rich Roll who’s an ultra marathon runner. I listened to it now a bit older than when I first heard him and a bit more mature, I guess. And it resonated so much with me, because everything he was saying was the same. everybody complains, and I guess we live in an era where you can you pull up, you do a hat, everyone’s got a voice. Yeah, exactly. But also, I feel like everybody’s out there pushing the best self and their image. And, and what he said is he said, listen, not everybody can build a million dollar company, only a few percent, because it takes a lot of work. And he said, all the the my big pet peeve is someone that isn’t happy with this situation, they want a certain amount of income or certain amount of lifestyle, but they don’t want to do the work that it takes to get there. And I think and I think that one of my one of my rules that I live with, and I think I think it was from Tony Robbins or somebody like that. But he said we always overestimate what we can do in one year. And we underestimate what we can do in a decade. And I think that’s any any success I have, I would say it’s the same thing. You know, I didn’t win the Golden Girls, my first year, it took me three years, three years and three attempts to win. I didn’t I wasn’t a top agent in my first year, it took me my third year in real estate. And I think that’s something it applies to sport, it applies to business, it applies to almost anything, even even relationships. I’m you know, I got married a year and a half ago, I think I’m a better husband now than I was, you know, when we were dating, because I’ve learned to be a better partner to communicate better, all these little things that would go into into a positive relationship. So I think that the big if you’re, if our audience is mainly in real estate, I would say you have to be a long term thinker, you have to you have to have a horizon where I get these new agents. And there was one that just joined a company, a really, really nice young young kid, very enthusiastic, he could be wonderful. But he’s they’re telling mo when he’s doing his training, it’s like, hey, I want to be like Lawrence. And it’s like, well, Lawrence didn’t just start his first year in real estate and selling million dollar investment properties, you know, it took time to so I would say you have to you have to play the long game in, in, in business for sure for success. And then talking about the discipline, I think it’s it’s it’s habits and consistency. So you have to always you always have to have the goal in the dream, right? People are very big on, you know, in I want to sell $10 million in in 12 months. And then they say okay, break that down. So that’s that’s a little a little under a million dollars a month. But that’s just that’s the that’s the dream in order to get there. You’ve got to beat us every single day you’re doing the right things, the right habits, the right consistency. And I think I think the best advice that I would give I think is relationships, because it not just with your like it’s when I when I deal with on the other side of a transaction with a professional broker. It’s such a pleasure we both on top of it, it’s just a seamless, smooth transaction. And when you deal with people that don’t know what they’re doing, and it’s like pulling teeth, and I think it’s the same with people like do you if I’m buying a house do I I want to work with a broker who’s a pleasure to be around. He’s knowledgeable, he’s responsive, he’s on top of it, or do I want to be with it with a guy who I’m chasing him so he can get my commission. So I think, and this is such small, easy things. And I’m a big believer in work hard, play hard. So I’m not trying to say, don’t have a life, but you have to have certain systems in place. So for instance, I was with my wife had had surgery on my elbow a couple of weeks ago, and I couldn’t do much. So I took a 10 day vacation to the Maldives and my wife, and I’m sitting there and I’m one of my good friends is doing a sell, buy. And he’s selling his building. And he was he was texting me. And he’s like, Lawrence, how are you more responsive, than the selling attorney who’s skiing in Vail he’s like, you’re in the middle of the Indian Ocean, you know, I had terrible service I’m on I’m on some crappy hotel Wi Fi. And he says it was it was a good reminder that, you know, you don’t want to eat, you definitely take breaks and technology break from your breaks and your phone break breaks from work. But also you have to have certain habits. So whether it’s first thing in the morning, and then you have a couple of different times 2pm 5pm And then evening before sleep, or whatever it is, you have to just stay consistent, whether it’s checking in with people, you know, replying to emails, doing your searches, just just, even just education. I think that’s a huge thing. I think consistency in education. I know that when I before I was in real estate, I was a huge reader. And the first couple years in real estate, I was so busy running around the city trying to learn the business take I would take horrendous leads, because I just wanted to be I just wanted to learn the business. I wanted to be out there learning. And I was actually dating a girl at the time who had been in real estate for a long time, she was very lazy. And she had all these just crappy rental leaves. And she was like, I don’t want this, this. I said I’ll take it all, I took hundreds and hundreds of rental leaves, I drove all around the city, because I wanted to know the city. While I wanted to know the business. While I wanted to be around people, I wanted to be busy, I wanted to be engaged. And during that time, I didn’t have I didn’t read read, there was a few years where I really didn’t read much I didn’t learn much. On that side of things I was just so focused on on the practical aspect of being a new broker. And I think my happiness went down hugely. So I think always, always putting time to improve yourself to learn. i For me, personally, it makes me a happier person. But it also makes you just much more knowledgeable person to be around. And to many people focus on what you’re gonna get. So I laugh I get on LinkedIn, I probably get three or four messages a week, almost one a day now. And it’s somebody like, hey, I really want you to give me business to this. When can we meet for coffee? Or when can we have a 50? Ma?
D.J. Paris 37:27
I was coffee messages every day? I’m like, I don’t know you.
Lawrence Dunning 37:32
Yeah, exactly. And I think that what’s what’s so funny about that is, what are they doing? They’re focusing on what they can get from me, they’re offering no value. So most of the time I don’t even have time to respond, was if I have say say say say it was a lender, and he sent me a message and said, Hey, I have a I have a guy who wants to buy a multi unit. I think he’s a he’s a pre qualified client. He’s great. Can you help him? And he buys a an $800,000 investment property? How much business? Am I going to give that guy back? I’m gonna get
D.J. Paris 38:01
back. Yeah, you’d be forever indebted to that bro. Second.
Lawrence Dunning 38:05
Exactly. And he would get so much business for me. So and I think that’s the same with everything. It’s like when I’m when I’m with a client. I’ve had relationships where, you know, when I work with some builders, where maybe maybe it was 12 months, 18 months, I didn’t make a single dollar. Right, I did quite a lot for them. But when it comes around that I’m going to be their broker for the foreseeable future. And, and I think that’s, it’s, again, coming back to that playing the long game is you have to you have to develop the relationships that are going to make you the money later on. And you got to focus on what you’re giving, as opposed to Hey, what buildings can I sell for you? Well, you know, what you’re doing are not really, you know, like, I think that that’s something I think that’s something we we see a lot in our business, but also I think it’s you know, 2020 that’s the culture, right? It’s like, I want to get up here, but I’m already down here and I don’t want to do all the steps. I just want to jump to the top. So I think trying to rush the process. It doesn’t help you either.
D.J. Paris 38:58
Yeah, it’s it’s always about discipline. So even like your example, I think, which is a good one, which a lot of times Realtors get into the business. They’re new, they say, okay, 10 million a year. And, you know, in my, let’s say, my second year, my first year, whatever seems reasonable. If you break it down to a million a month, that’s couple of two to three clients a month, that seems like reasonable. The problem is, then the question is okay, that’s not really the goal. That’s the result. So like a goal is okay, how many people do I need to meet today so that in three months, I might have one client, right? And maybe it’s I need to meet five people every single day or whatever that number is. And if you just drill down to like one or two metrics that you can do on a daily basis, pretty much everything else should take care of itself. But it’s realizing everyday wake up, like I’m sure the same thing with with the different sports that you’ve been involved in. It’s a certain amount of practice that you just have to do and then hopefully, come come game time or match time. You can just go into autopilot but it’s all the push ups. It’s all of the boring, daily activity. Is that when the game right,
Lawrence Dunning 40:01
exactly. I think that’s so so, so great. You picked up on that. There’s a really great analogy that I read recently. And it’s it says, if you’re if you’re taken off from LA, and you point the nose of the 7476 degrees to the right, by the time you land on the East Coast, that’s going to make the difference between landing in New York or in Washington. And I love that. And what he’s saying is, here’s the thing, if you if you I’m a, I’m a pretty healthy bus, and maybe maybe I’m, I’m trying to train for a marathon in six weeks, which I actually am, I can tell, I can skip my I can skip my run today. Because I can run tomorrow, that one run isn’t gonna make any difference. But if you do that every day, I’m not gonna better run. And it’s I think that’s, that’s such an important point you just said is, though, it seems if you’re trying to lose weight, and you, you know, you go out and you have absolutely you pick out, you get drunk, and I haven’t had a big night, that’s not going to meet you, you’re gonna wake up the next day, you probably gonna look pretty much the same. If you take off your shirt, look in the mirror. But if you keep doing those actions, it that’s that’s the key. So I think the way the way to summarize it is, if you’re doing the right actions, time becomes your ally, as you as you move towards your goal, time is helping you get there. And if you do the wrong actions, time is going to become your enemy. And I think that’s such a you picked up on that 100% That applies to almost everything in life, right? It’s like that the one action today is not going to make or break you. But it’s that done repeatedly, that’s going to be the difference between a winner and a loser.
D.J. Paris 41:31
And by the way, it really does apply to everything. And this idea of checking in or measuring on a daily basis is so important. And it doesn’t mean you have to be super anal and judge yourself every day. But you do need even like relationships are more abstract example. If and this is not the most romantic thing that anyone would want to hear. But the truth is, if I don’t sit and think, How am I doing in my relationship? When’s the last time I told my girlfriend how beautiful she is? When’s the last time I did something really nice for her. You know, and again, I would love it if those things just came to me every single day naturally, and I never had to think about it. But the truth is just like anything else, that you know, I have to remind myself I have to I have to have daily activities. So that you’re right. Well, my girlfriend notice for if three straight days I don’t mention how beautiful she is? Probably not. Who knows, maybe she would. But I know that it’s important. And I want to do those things for her. But I better be checking in with myself and no, hey, it’s time for me to say something really nice. And again, the maybe that’s not the best example. But it sort of is because you actually
Lawrence Dunning 42:31
know, I think that no, I think that is the perfect example. Because what you know, like it’s exactly, check it being a good, you know, boyfriend or husband one day to the next is not going to make or break a relationship. But over time, it 100% Will. And I think that’s it’s short, there was a there’s a book or something like the power of small changes or something that talks about this a long time ago. And I think it’s so true. It’s like what you do today does matter. And it’s compounded every day. And I think but in order back to the discipline thing, I think that motivation comes and goes. And that’s why that’s why you have to like I’m really big on I love listening to Les Brown is my favorite, but I love like I’ll sometimes put on one of those 30 minute motivational, you know, with music and some different motivational speakers talking, and I’ll go for a run. And it’s like a slow recovery run at the end of the day. And I’m just letting my letting my mind kind of clear. And I’m you’re basically filling up your brain with just positivity, motivation, inspiration, all these things. That’s great. But the problem is we, we we all have days where you wake up your body, so you don’t want to go to the gym, you wake up, you’ve got a headache, you don’t want to talk to 10 clients. So what gets you through those days is just having your big picture goal and just making it I wouldn’t even say it’s discipline, I would say it’s it’s a conscious choice you make. This is my lifestyle. And I think they talk about that where you, you have to have that. So if you want to be a top agent, for example, to bring it back to real estate, you have the image of yourself as a top agent, well, how does a top agent act? Well, he, you know, he, he looks good. When he goes to showings, he conducts himself in a professional way. He’s responsive, he gets back to people, he’s knowledgeable, he knows what he’s doing. So if you have that image of you as that person, you’re going to do all the things you need to do it. Likewise, if you’re if you’re an athlete, and you see yourself as a champion, what does the champion do? Well, he gets his sleep, he gets his massages, he eats well, he can hit go to the gym when he does. Of course, there’s going to be days where if you’re sick or injured, you’re going to have to take a break. But aside from that, you don’t even think about it. If I wake up tomorrow, I teach jiu jitsu on Wednesdays, if I wake up tomorrow, my back’s sore and I’ve got a headache. I’m not even thinking about not going just so it’s it’s gonna happen, you know, you don’t even give yourself a choice. And I think that’s a really key point is if something is important enough to you. So you actually really want it you have to make it an unconscious choice. Otherwise, we all have we all have that little voice inside us like oh, you know you’re tired when you skip today and, and it’s I remember I remember talking to talking an old friend years ago, and he said to me, oh, it’s alright for you. You know it You’re lucky it’s easy for you to do these things. And I was like, oh, no, I’m
D.J. Paris 45:04
not easy for you at all.
Lawrence Dunning 45:08
Exactly. And I was so happy. I remember when, back when I was boxing when I was in my 20s. And I, every morning that I knew I had a boxing match in the evening, every single time. I would say, Why am I doing this? Like, I’m not getting paid for this. I got a good career. Like, why am I putting myself in this vision every single time and I remember years later, I was watching like some I think it was George St. Pierre, the UFC champion at my weight welterweight. And he’s he was joking. He said he was going to the arena for his fight. And he said, Man, I wish there was some kind of crazy electrical out. Power outage, the whole stadium was shut down, and they canceled the fight. And I thought, wow, so it’s not just me, every single champion, every single person has to overcome this. You don’t want to do these hard things. It’s ingrained in our DNA, right? We, we have something we all are here today. Because you know, our ancestors survived. And there’s something in survival, where it’s that natural thing where if you don’t have to do it, why are you doing it? So we have to overcome this innate laziness. And I think that it’s, you know, the habits, the discipline, all that stuff. That’s it, but it’s not, you know, the David Goggins has become very famous recently. He’s, he’s, he’s really big on, you know, motivational Instagram and everything. And one thing I really like about him is he says, There is no finish line. And I think that’s so true. I have a friend of mine, I was complaining about some damage, just before my elbow surgery, I’m complaining to one of my good friends, Brad, who does jiu jitsu with me, and he’s an investor and a good friend of mine. And I was like, God sucks. And I’m getting older than these surgeries. I’m 4041 in a few weeks. And he says to me said, Yeah, but it’s, you’ll find like, you can sit in your office, and I’ve got some, some some framed pictures and some medals and trophies, and, you know, memorabilia from two decades in those sports. And he’s like, you’ve achieved so much, you must be so awesome. And I’m, I’m thinking but once it once you achieved it, I want to keep going. I don’t want to sit on my laurels and arrest and that’s actually something I’m very passionate about. It’s just happiness, positive psychology and, and because ultimately, why do you want to be a top agent to a new agent? He thinks if he if he sells $10 million a year, he makes a 250,000 commission. He’s gonna that’s gonna give him a lifestyle for him to be happy.
D.J. Paris 47:08
I will finally be happy when I achieve X.
Lawrence Dunning 47:11
Yeah, yes. And I think that’s so like, so almost all the decisions we make in life, we’re trying to we think we’re doing them you know, to give us happiness. So I think for me, you have to be you know, high achievers ever going to be where they want to be in life.
D.J. Paris 47:27
Okay, guys, sorry about that. We lost a Lawrence we got disconnected and we’re going to schedule a part two because he’s so great. And it’s so much value to bring to the audience that we’re going to get him back on the show. So sorry for the abrupt ending here. But we Lawrence and I wanted to thank everyone for listening. We’re excited to have him back in a future episode for a part two. For now, we will say thank you. And also we want to remind everyone to follow us on Facebook, go visit firstname.lastname@example.org forward slash keeping it real pod and please tell a friend think of one other real estate professional that could benefit from hearing this great interview you just heard from Lawrence and tell them about our show. Have them visit our website, keeping it real pod.com And subscribe to us on iTunes, Spotify, Google Play Stitcher, Pandora, anywhere podcasts are served. You’ll find our podcast thanks again. On behalf of Lawrence and myself and we’re gonna get Lawrence right back on the show. Thanks, guys. Stay safe.