Resist the Urge to Redeploy Capital Immediately After Exit
If you sell your company, resist the urge to redeploy capital immediately.
Take time to emotionally settle and avoid impulsive investments after a large cash influx.
Consider a "loose rule" of pausing investments or new ventures for a year after an exit to gain clarity.
This helps prevent emotional investment decisions driven by the excitement of a recent exit and allows for more thoughtful capital allocation.
Focus on achieving an emotionally stable state before making significant financial decisions.
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Transcript
Episode notes
In this interview, Eric Siu and real estate mogul Ken McElroy reveal the strategies behind successful property deals, smart cash flow management, and the art of leveraging debt. Ken shares how politics impact real estate, the power of YouTube for attracting investors, and why building wealth is about more than just money. Get ready for some powerful insights!
Watch the full interview here:
TIME-STAMPED SHOW NOTES:
(0:00) Opening and Introductions
(02:30) Debt Coverage and Managing Expenses
(07:17) Recent Real Estate Deals and Cash Flow
(12:05) Fixed Rate Debt and Value-Add Properties
(19:23) Market Migration and Political Environment
(21:41) Break-Even Points in Real Estate
(25:59) The Purpose of a Business is to Buy Real Estate