Daniel St-Jean – Choose Your Investing System and Follow It

Nov 16, 2020

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Daniel St-Jean was born and raised in Montreal. Still, he has also lived in Whitehorse Yukon Territory, Vancouver BC, Ottawa, and now home is in Niagara-on-the-Lake, Ontario.

He is an entrepreneur to the core, and the last time he received a paycheck as an employee was in 1986.

Over the 34 years since, he has owned several businesses, including an art gallery and framing shop and a publishing company. As well, he wrote and published two Canadian bestsellers.

He started investing in real estate in 2010 with his wife Laurel because they needed a source of income that was not tied to them living in Ottawa, where they were working as consultants.

They wanted to move to Ontario’s wine region, so Laurel could pursue a life-long dream of becoming a winemaker.

It took them only four years to be in a position to kiss Ottawa goodbye and move to Niagara-on-the-Lake.

In their 11 years in the real estate investing business, they have acquired 62 properties worth over $25 million. The fantastic part is that to date; they are yet to invest one dollar in that portfolio—100% financed with OPM–Other People’s Money.

How to do that is one of the many things they teach the members of The REITE Club that they co-founded in March 2017.

“We are now following our investing system to the letter, no exception for any reason whatsoever. Now we’re successful.”

Daniel St-Jean

Worst investment ever

Daniel and his wife kicked off their real estate investing career with the rent-to-own strategy. They built on it slowly and got some real success out of it. In 2012, they went to Nova Scotia to expand their market. They found some cool people who wanted to do a rent-to-own deal, and they decided to get into business with them.

Breaking their own rules

Daniel and his wife had a couple of rules that they followed when looking for property to invest in. One was to pick a house that they could quickly sell should the people renting it walk away. The second rule was always to take a deposit. However, they broke these two crucial real estate investing rules.

Facing the consequences

After two months of renting the house, the people moved out unbeknownst to Daniel and his wife. They were now stuck with a house in the middle of nowhere with snowbanks so high. It wasn’t the easiest house to sell, but they managed to, albeit making a loss of $25,000.

Putting in place a reliable investing system

After that loss, Daniel spent the next three or four months, setting up an investing system. This system had about 52 points, and this was the system he would always stick to when making investment decisions.

Breaking the rules again

In the Fall of 2013, Daniel did a refinancing deal with a family that he felt needed his help. He didn’t like the house much, and he also didn’t take a deposit, but he went ahead and bought the house because he wanted to help this lovely family.

The family, however, panicked and moved out just as the purchase was being closed. Now Daniel had this rundown empty massive house in a little town outside of Ottawa. The empty house cost Daniel $2,500 every month to maintain.

Finding the elusive buyer

In the Spring of 2014, someone approached Daniel and told him that he’d want to rent the house and turn it into a daycare. He would be paying $4,500 in rent. Daniel got excited about the prospect of finally making some money from this property. However, after a year of waiting for the guy to get approval for his daycare, they found out that the water supply on that side of the street was insufficient for them to run a daycare, and so the client slowly walked away.

Finally, Daniel could rent it out to a tenant paying $2,500 just enough to break even. But when the people later moved out, it was a total disaster. The house was in a complete mess.

Fixing his mess

Daniel had to fix the mess before putting the house on the market. This cost him $90,000. Then as luck would have it, the weekend before Daniel listed the house, there was a huge storm that left the basement with two feet of water ruining the drywall and doors. Daniel had to spend another $40,000 to do repairs.

At the end of it all, Daniel made a loss of $226,000 and change on that deal, making it his worst investment ever just because he failed to stick to his investing system.

Lessons learned

Don’t deviate from your investing system

Once you put an investing system in place, do not deviate from it come hell or high water. There are many ways to invest, but once you’ve figured out what strategy works for you, never deviate from that system.

Don’t conduct business with your heart

Conduct your business transactions with your head to make money, and then you give it away with your heart. Don’t ever try to conduct your business transaction with your heart because, very often, it’s going to end up not benefiting you.

Andrew’s takeaways

Business is business; leave philanthropy out of it

If you want to help people, make a profit, and give it to them. But don’t confuse business with helping people in that way. If you use your business to help people, it will bring significant conflict into the business.

Don’t break your investing process

Stick to your investing process, especially during the times that you are tempted to break the system. Your system may underperform for some time, and it can be tempting to change your investing strategy. But if you start to change your system midstream, you bring your entire system down.

Actionable advice

Whatever strategy you use, put systems in place and follow them. Period.

No. 1 goal for the next 12 months

Daniel’s number one goal for the next 12 months is to have 20,000 members in his REITE Club community. The goal of that community is to help people experience freedom, whatever freedom means for them.

Parting words

“Time is finite. So please build a team and use it to save time. Then you can use that nonrenewable resource to do more deals or just to enjoy life.”