January 4, 2021

JF2316: Rentals & ATMs With Billy Keels

Billy has been working as a sales executive for a market-leading application software company and is a real estate entrepreneur, long-distance investing expert coach, and mentor. He currently has 361 doors as well as ATM machines. 

Billy Keels Real Estate Background:

  • Full-time Application Software Sales Executive
  • Bought his first rental in June 2013
  • Portfolio consists of 361 doors as well as ATM machines
  • Based in Barcelona, Spain
  • Say hi to him at: www.billykeels.com 
  • Best Ever Book: The Creature From Jekyll Island

Click here for more info on groundbreaker.co


Best Ever Tweet:

“It’s about always making sure that your capital is always working out.” – Billy Keels


Theo Hicks: Hello, Best Ever listeners, and welcome to the best real estate investing advice ever show. I’m Theo Hicks, and today we’ll be speaking with Billy Keels. Billy, how are you doing today?

Billy Keels: Theo, I’m doing fantastic, and really looking forward to today’s conversation.

Theo Hicks: Yes, me too, and thank you for joining us today. A little bit about Billy – he is a full-time application software sales executive. He bought his first rental in June of 2013, and his portfolio now consists of 361 doors, as well as ATM machines. He is based in Barcelona, Spain, and his website is BillyKeels.com.

Billy, do you mind telling us some more about your background and what you’re focused on today?

Billy Keels: Sure, Theo. You highlighted a couple things there, and I guess a very typical software sales executive, I’ve done leadership as well in the software sales arena… And I’ve been living in Europe for the last 19 years, actually. I didn’t even plan on doing that… And when I was here, I was fortunate enough to enjoy three different countries; I lived in France, I lived in Italy, and most recently in Spain… And I guess one of the reasons, aside from working in large multinational enterprise leading software type of companies, I had some experiences that were not so nice in the stock market crash in 2000… And then the same thing happened in 2008. So one of the things my parents always told me – if something happens once, it’s shame on them; if it happens twice, shame on you. So it was at that point, 2008, that I started really looking for some new alternatives… And that’s when a couple years later I actually found real  estate.

I was one of those people who just very much wanted to continue to climb the corporate ladder. I was doing everything to get the next raise, to get the next promotion… And as I went through that, I started realizing that I was going around and around and around in circles. And I remember one morning in October that my older son was turning 3, and I remember getting on a plane that morning – I was supposed to go to Germany, and when I flew to Germany, I thought “Well, something’s not right. I’ve been doing all this work”, I wanted to do all these things so that I could spend more time with my family, and I was flying away on my son’s third birthday.

So that’s when I really started focusing on how I could take more control of my financial life; that’s what I was thinking about then, and that’s how I started getting into real estate. I thought that I was gonna buy real estate here in Spain, because I read this little purple book, Rich Dad, Poor Dad, that kind of changed my life… And one thing led to the next, and as a US citizen who was living abroad, someone said to me one day “Well, why don’t you buy a property back in the United States?” and I thought that was the craziest thing I’d ever heard… But after listening to a couple people and doing my own research, that’s exactly what I decided to do.

So that’s how I got into real estate, that is what I’m enjoying, and now really having real estate as a vehicle that can help myself, and now even other investors that are alongside me get closer to our goals and our dreams, so we can really live the life that we want to.

Theo Hicks: Thank you for sharing that. So those 361 doors – are those all in the U.S.?

Billy Keels: 100% in the United States. They are, Theo.

Theo Hicks: Okay. And then can you maybe give us a breakdown of what those doors are? Are those single-family houses that you bought by yourself? Are you raising money for larger apartment deals? What’s that portfolio and what’s your main focus now?

Billy Keels: Yeah, I love that question. So what I have today is a mixture. So there are properties that actually 100% my company owns… And then I also found out – because I didn’t really know – that you could invest with and through other people’s syndications. So I’ve done a mixture of the two of those to get to the 361 doors, as well as the ATM.  So I’ve actually done active, as well as passive investing

And as it relates to where I’m going now, even though I’m working in a very large multinational, my focus is really on building out the syndication part of the business, to be able to do that and do that in a way that is done full-time… Because one of the things that I really love, Theo, that I’ve found, is that I can use a lot of the same skillset that I’ve been building in the multinational, and I can do that to actually bring value to people that I know, and that know, like and trust me… And that is something that’s given me a lot of emotional satisfaction and fulfillment, and that is definitely where my heart and my mind is moving me, is to add more value in that way, as someone who is able to syndicate different types of opportunity.

Theo Hicks: So just to confirm – your company owns a portion of those, and then another portion of those are you passively invested into other deals… And then moving forward, you wanna start transitioning into raising money from other people for your own deals.

Billy Keels: Absolutely correct.

Theo Hicks: So what would you say is the number one thing you’ve learned, or the number one piece of advice you would give to someone who wants to invest while  not living in that country?

Billy Keels: This is one of the things I really like to focus on a  lot, and have been focusing on a lot lately, and speaking to people, and doing a lot of that even on my podcast… But this really is about helping people to understand that whether you’re tens of thousands of kilometers away or you are 30 kilometers/miles away from a property and it’s not in your backyard, at the end of the day, when you want to be able to scale and sleep well at night, it comes down to making sure that you understand why you want to invest in something, whatever that something is… And then when you’re doing it, if you wanna scale, it’s make sure that you’re in the location that’s going to provide you what it is that you’re looking for. That could be cashflow, that could be appreciation, that could be privacy; it depends on what the person’s looking for. And then the most important element is, without a doubt, in my experience, the team.

Make sure that you understand the team, make sure that you understand the track record of the team, understand what they’re very good at, understand where maybe they need to rely on others to complement what they’re doing… But I would say without a doubt, especially if you’re looking to place capital, or even if it’s your own team, it’s to make sure that you have a very strong team.

Theo Hicks: Let’s talk about ATMs. How does investing in ATM work?

Billy Keels: This is one of the things that I’ve found out as a passive investor; I guess when you’re really busy and you’re in a multinational and you’re thinking to yourself “Well, you’ve gotta bet on the stock market, you’ve gotta do this, you’ve gotta do that”, and one day it looks like you’ve got a lot of money, because it’s on paper, and then three days later some things happen, or someone’s said something or done something and you’re in the hole again… So one of the things that attracted me to ATMs, or at least the ones that I’ve invested in passively, is it provided a very predictable stream of income. There was a portion of my portfolio that I needed to just provide very predictable streams of income.

So building our relationships, understanding, getting to know more about the person who is syndicating, as well as the team that was delivering their track record, how many successful ventures they’ve done – it  was something that made sense for me, because as I mentioned, I was looking for a portion of my portfolio to provide very predictable streams of income. ATMs are a real asset at the end of the day, it’s a  real asset play, and it’s something that everybody understands. You walk up to an ATM machine, you take money out, and when you take money out, you typically see at the bottom there’s a little transaction fee… So there is a portion of that transaction fee that goes to the person that owns the machine, there’s a portion that goes to the person that’s renting it in the space, the restaurant or whatever place you’re in… And then to the investor.

So it was something that really made sense, it was really simple, and it fit into what I wanted that part of my portfolio to do.

Theo Hicks: Can you maybe walk us through an example of one of your ATM investments? How you’ve found the actual team that owned the ATM, and then what the compensation to you looks like. You don’t have to get specific if you don’t want to, but just to understand how much money I can make investing in ATMs, and then how do I find these ATM deals.

Billy Keels: So just explaining how it works, the mechanics behind it? Is that right?

Theo Hicks: I’m more thinking how do I find these people, and then how much money will I make.

Billy Keels: Perfect, I love that. So it’s much like most things  – you have to be in the right place t the right time, and you need to be able to find the people. So you’re asking the right questions – I’m sure people will want to know how do you find out more about ATM machines; as I’ve mentioned, I’ve done this passively.

One of the things I think is really important, Theo, is to continuously go out and look to build relationships. I know it’s something that you believe a lot in as well. And I have done that not only living in Spain, but you meet a lot of people doing things remotely, on Zoom, or Skype, or Teams, or whatever the case may be… But I actually spend a lot of time where I invest my own capital to fly back to United States. So going to a number of events in the United States, I was able to meet people, and a lot of times, in a lot of these different events, there are people that have certain types of opportunities. It can be self-storage, it can be multifamily, it can be ATM. I didn’t know much about ATM, but it was something — just like you’re asking the question now, it’s like “Okay, let me find out a little bit more about this. I don’t have any idea about it.”

So through a number of different relationships and getting to meet people over the span of a year, I was able to find out specifically about the ATM opportunity. So having taken action, gone to the U.S, met someone at an event, when I was there at the event; we had a conversation then offline. I had a chance to meet them offline back in the United States, and then found out more about the specific ATM opportunity.

Basically, the way that the ATM works – and this is different for different people, but this specific ATM works… Is you put a certain amount of money – this is typically for accredited investors; I believe it’s accredited investors only, this particular one… But you place your capital; you have a seven-year lease on the ATMs. For the use of your capital during the seven-year period you get a predictable stream of income every single month. So every single month for the use of your capital, for a period of seven years, you get the exact same amount of capital, that you can see from now until seven years from now.

Going back, it’s really about being able to build relationships, meet people, ask the right questions, and find out about the opportunity; that was done offline.  We went online, and eventually offline, and it was something that made sense for me and that specific portion of capital in my portfolio. So hopefully, that is clear, how we built the relationship, and also the way that this particular ATM works.

Theo Hicks: Something else I wanna ask you, too – we talked about before you were in real estate you were doing the stock market, and how the values kind of fluctuate, you’re not really in control, and so you knew that you needed to transition into something else that gave  you more control… But it sounds like you’re kind of investing your own money  into your active business, you’re investing money passive into real estate, you’re investing money passively into ATMs… How do you decide what portion of your money goes into what? Or maybe a different way to look at it is  am I gonna invest in ATMs next, or am I gonna invest in my own deals next, am I gonna invest in this next? Or was it kind of just as opportunities come up? How do you know what to invest in and how do you know what portion of your capital should go into what?

Billy Keels: Okay, I love that question. And I guess this is maybe just giving you a little bit more about my background and how I grew up. I grew up in a family where we didn’t have lots of excess capital, so one of the things as I started to get to know myself  even more – I really fell in love with being able to see money in the bank, because that gave me a sense of security, and a sense of satisfaction.

Up until recently, I really was one of those people that believed “Just have more and more capital.” And as I’ve continued to get educated more and more, it’s about making sure that my capital is always working out. It’s always on the treadmill and moving. So at the same time, I wanna make sure that there is always a portion of my capital that is in the bank, so that I can sleep well at night no matter what.

And then from there, it’s going through a process of saying “There is a portion of my capital that I know that I want to be able to actively manage”, for a couple of reasons. Number one, because I want my business to continue to grow; so through that business and placing capital and building the relationships I’m able to make sure that that capital will also get the highest financial return, as well as educational return, I believe… And I have that portion of my portfolio that isn’t active.

And then there is a lesser portion of my portfolio that I know that I don’t want just sitting in the bank, Theo, because that’s something that I did for a really long time, and I realized that that wasn’t it. I’ve been in an area where I wanted to know more about multifamily investing, so I knew that I wanted to place capital in at least one or two other passive investments. So it was more about the quantity of investments in multifamily assets. I knew that I wanted to do something that was development, so I placed capital on development, and then there was just additional capital.

So the ATM play was really the wild card that went beyond the multifamily, and went beyond development. So it wasn’t any more sophisticated than that, but I knew more than anything that there was a portion of my capital that I just wanted to be in the bank, so that I can sleep well at night; the other portions of my capital were specifically there to be able to invest. A larger portion for direct investment, to build out my business, and then the others were to gain more experience and have that capital working.

Theo Hicks: And then really quickly – you don’t have to give me exact numbers, but if you had 100% of your money, what percent is that security blanket, what percent is being actively managed, what percent is being passive invested? If you had to give me ballpark percentages.

Billy Keels: For me it’s 15% that is just sitting there, that I know just needs to be there to help keep me fine in the evening. Then there’s gonna be about another 45%-50% that is actively for my business, and then another 35% that is moving or investing through and with other people.

Theo Hicks: Alright, Billy, what is your best real estate investing advice ever?

Billy Keels: So one of the things I believe is that you need to surrounding yourself with the right  team of people that are where you want to be, so that they can always inspire you. And most importantly, you need to take action. And take action before you’re ready; don’t be like I was many years ago, and I’m still fighting through this as a recovering perfectionist. So don’t wait for things to be perfect before you get started, or you will lose so much time. And time is really what is the most important thing. So start before you’re ready I guess is probably the best thing.

Theo Hicks: Alright, Billy, are you ready for the Best Ever Lightning Round?

Billy Keels: I am. Let’s go!

Theo Hicks: Perfect. First, a quick word from our sponsor.

Break: [00:17:21].05] to  [00:18:10].23]

Theo Hicks: Okay, Billy – if you guys are watching on YouTube, you’ll see the beautiful bookshelves behind him, so… What is the best ever book you’ve recently read?

Billy Keels: Wow, the best ever book I’ve recently read… It’s one that I talk about a lot. It’s called “The creature from Jekyll Island.” I say “recently read” because I’m rereading it again; it’s by G. Edward Griffin. It’s just amazing if you really wanna understand what is happening what is happening, how the money system works, debt… It’s “The creature from Jekyll Island.”

Theo Hicks: If your business were to collapse today, what would you do next?

Billy Keels: The first thing that I would do is, number one, make sure that I have a clear plan, and reach out to my network.

Theo Hicks: If you’ve lost money on a deal before, how much money did you lose and what lesson did you learn?

Billy Keels: Wow. So I definitely lost money on a deal; the one that has been the most painful is I lost $25,000 because I did not take the time to read a home inspection. I got the home inspection done, but once I got the home inspection done, I didn’t read it and really understand it. I just felt good because I got  it, and it cost me $25,000 on some roof issues… So the lesson is if you’re gonna take the time to get the inspections, make sure that you or somebody on your team understands what the potential risks are. That cost me $25,000 about seven months into owning the property.

Theo Hicks: What about the best ever deal you’ve done?

Billy Keels: Without a doubt it’s — my company purchased a mobile home park in the Charlotte MSA. Without a doubt, it was the best opportunity, primarily because it was one where the owner – he was really skeptical of owner financing, and once he understood, because myself and the broker would really spend time helping him to understand the advantages for him from a taxation perspective, he got his accountant involved, and it was something that really worked out well for him, and it also worked out for my company as well. So that was without a doubt the best ever opportunity.

Theo Hicks: What is the best ever way you like to give back?

Billy Keels: Really two ways. Number one is there’s something that we do every year, where we actually donate capital to a local children’s school just outside of Barcelona. At the same time, I also love spending time helping people to understand, especially really busy six-figure salary employees to understand more about finances by playing Cashflow 101. It’s one of my favorite things to give back.

Theo Hicks: So we have a few more minutes, and there’s one thing I wanted to ask, and I wanted to make sure I have enough time… So you do work full-time as an application software sales executive, and then you’ve got half of your money in your active real estate business, buying mobile home parks, and rental properties… You’re passively investing… When are you doing the real estate aspect of your business? Do you have a job that allows you to do it during the day, or are you waking up really early, or doing it at night, or only at weekends? How does that work?

Billy Keels: Yeah, great question. One of the things that I’ve been very blessed with is that I sleep very little. So I love – and I like to share on different social media platforms as well – to wake up in the morning. I don’t have an alarm clock or anything like that, but I’m usually up somewhere between [4:30] and [5:30]. For where I live, that’s really early… So I go through meditation, reading in the morning, getting things done, and then I can focus on my business before my boys wake up and get ready for school.

So between about [4:35] until 8 o’clock I really have time to focus on myself, on getting my energy right, and also looking at the business. Then I’m working typically from about 9 until 6 or so, and then afterwards I like to spend some time with my boys. It doesn’t always happen every single time, but I do like to get some quality time with them, and then typically once I have dinner, I’m going back and I’m working on building relationships, I’m on the phone, or specifically looking at the properties, and then I’m in bed somewhere around [11:30], 12. [unintelligible [00:21:44].09] and I try to maximize every single minute that I can between family, my own business, and definitely with the company where I’m working, where I continue to overachieve, again, some of the objectives.

Theo Hicks: Thank you for breaking that down for us, I appreciate that. I’ve always wanted to try the getting up early, but I definitely cannot survive off of that little sleep… Maybe it’s something you just kind of get used to.

The last question is what’s the best ever place to reach you.

Billy Keels: The best ever place to reach me is basically on my website, which is BillyKeels.com, which you’ve talked about before. If anyone wants to learn more about long-distance investing and some of the things that you can avoid and a lot of the mistakes that I’ve made, you can also go to billykeels.com/seven-mistakes-to-avoid, and we’ll be in touch. I’ll get you a PDF so you can avoid the mistakes that I’ve made.

Theo Hicks: Perfect, Billy. Well, thank you for joining us. A lot of solid info, I think, in this interview. Really, we kind of focused a lot on two things. Number one is how do you do your full-time job and invest at the same time? For you, you don’t sleep a lot; for other people it’s obviously working in the morning, working at night, or working on weekends…

And then in the actual investment arena we’ve talked about diversification and the balance between the different types of ways you can invest… And then the benefits of each of those different types. So you’ve talked about you’ve got your money that kind of just sits there for security, and you’ve got the money that you actively manage for your financial reasons, but also for educational reasons; passive investing – same thing… It’s like, “Okay, I might be interested in doing this type of thing in the future”, so rather than just doing it for a year, you’re going to just passively invest in a deal and see what it’s like. I really appreciate you talking about that.

Then also you went into a lot of specifics on investing in ATMs, which I thought was very fascinating. Billy, thank you for joining us; I really appreciate it. Best Ever listeners, as always, thank you for listening. Have a best ever day, and we will talk to you tomorrow.

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