The American investing industry can be a little bit confusing to get into at first because it's very much its own thing with plenty of unique quirks that require a good amount of study. Despite this, it's certainly not impossible to make sure that you're able to understand what you're doing and all the best ways to go about things. Reed Goossens is a real estate entrepreneur and investor who moved to the USA from Australia. Reed shares his experience with Keith Baker of investing in the US and navigating the industry from what was initially an outsider's perspective. Reed's story is an empowering story of finding success after finally being able to adapt, and it's certainly not to be missed!
The Private Lenders Podcast is the only podcast teaching people how to become passive real estate investors while helping them keeping the money safe in investing in private mortgages to other investors. If you’re looking for practical tips and advice on being a successful private lender and how to successfully build wealth without banks in Wall Street, then you are in the right place. If you are looking to learn from my mistakes and shorten your learning curve, then pull up a chair and pour yourself a few fingers of Scotland’s finest and add a few drops of water, because this podcast is for you.
Several years ago, I began listening to podcasts along with NPR and BiggerPockets. Investing in the US Podcast was one of the few real estate podcasts that I had in constant rotation. Joe McCall was another one, Kevin Bupp as well. I found the story of the host of this podcast, coming from The United States and from Australia, and living off his version of The American Dream, I find it inspiring. I’m happy to have the man himself on the show, all the way from Down Under, Mr. Reed Goossens. I think you’re going to find Reed’s story quite compelling. I hope that you find it as fascinating and valuable as I did. There’s a lot of info that we go into. There are a lot of rabbit holes that we could have gone down, and looking back, perhaps we should have gone down a few of those. In the end, I hope you find the extreme value in this interview. Without any further ado, let’s get down to the brass tacks and straight into the interview with Reed Goossens.
I want to welcome Reed Goossens to the show. Reed, welcome.
Thank you so much for having me.
You're from Southwest, Texas.
Southwest all the way up near Amarillo.
I've already given them a little bit of background, but as we were talking in the pre-interview, your podcast is one of the first that I listened to many years ago when I was kicking around the idea of this show. The reason why I wanted you on is because the older I get, I'm a firm believer that there are two types of people: people that get it done or make progress and people that make excuses. When I look at somebody like you and hear your story, it makes me feel like a slacker. It gives me lots of motivation. For the people in the US that don't know who you are in the real estate investing world, can you give us a little bit of your background? How did you get to Amarillo from Australia?
I live in Los Angeles. The whole premise is that I moved to the United States in 2012 to chase two things. It was both for love. It was to live in New York City. I fell in love with New York City and to chase a girl. I'm married. That was coming over here back in 2012 on a whim to say, “Screw it.” I fear regret and I'd hate to wake up when I'm 70 years of age and go, “I wish I'd lived in the United States for a period of time.” On a whim, I quit my job. I knew there was an awesome visa here for Aussies and rocked up in New York City. My background is in Structural Engineering and I knocked on engineering companies’ doors until someone said yes.
I pounded the pavement in New York City and got a job within two months. I got the visa and then started investing pretty much soon thereafter. That was back in 2012. I've quit the job. I’m the Cofounder of Wildhorn Capital. I control about $175 million worth of a multifamily real estate. I’m a bestselling author and also a podcast host. I don't say it to boast. I say it more to inspire that I, an Aussie, grew up with blue-collar means, my parents both teach. I moved to the United States with a mission to give it a go. If I can do it with limited funds, no established network, no family and give it a crack and achieve financial freedom through US real estate in seven years, then why can't you? I had visa issues, so there's no excuse. If people are reading out there going, “I wish I should get started,” get started because my perspective is that the United States is awesome when it comes to real estate investing, both cashflow and appreciation. You don't realize what you're sitting on. Get off the fence and get going.
I can speak for myself that I'm an American, why isn't everything easy for me? I've then started traveling the world. The last time I went to New York City, I had two Uber drivers. One was from Pakistan and the other one was from The Horn of Africa. I’m like, “What brought you here?" “Opportunity.” They wanted the chance. They didn't want the guarantee to succeed. They wanted the chance to succeed.
It’s the chance for a lot of ex-pats. I didn't come from a war-torn country like The Horn of Africa or anything like that, but it was still a mission for me. I'm sure a lot of people that you meet when you travel are like, “Aussies are everywhere.” They call us JAFAs, Just Another Freaking Aussie. The reason is because we were very isolated down there. We all speak, talk and look the same. It costs a lot of money to get out of Australia. When you go, you want to travel the world and experience it. It's built in our DNA to get at it and give it a crack. A lot of Aussies that do make it to the United States who I've met in my travels and doing business are pretty top-shelf type of people. They’re here and they've got their back against the wall and all they want to do is succeed. It's that ex-pat mentality of the only other option is to move home or you're all in. All the chips are on the table and let's give it a go.
You were an engineer back in Australia. You came to New York for the love of the city.
I’m a structural engineer. I worked pretty much up until 2000 to halfway through 2017 when I got married. I was working a full-time job. The premise was I came to the United States and found an engineering job. I pounded the pavement until someone said yes. I realized in 2012, putting your resume on Indeed.com was not going to cut it. I'd done the suit and knocked, “Who are you?” I've got an interesting story. I'd worked in London for the 2012 Olympic Games back in ‘08 and ‘09. I had some worldly experience that I could offer some people, but I knew that if a company had more than 30 people and don't have an HR, if they see my resume and saw that I was educated in Australia, they’ll chuck it in the bin.
I needed to do something different and that was knocking on doors and eventually, someone said yes. I ended up working for a Russian guy who had a structural engineering firm and half of the people working there were ex-pats as well. New York City is a boiling pot of ex-pats and my whole mindset is like, “I'm not going to get a job because I'm Australian.” That was washed away very quickly because New York City is the boiling pot. I then moved to Los Angeles in 2014, and at that time I had to make a decision, “If I have to stay in a W-2 because I needed a visa to stay in the country, let's use the skills that I have and transition into working for a real estate developer.”
I emailed out a bunch of people that I happened to be working with from the structural engineering firm as a consultant. I was like, “I'm sick of engineering and I want to get into real estate development. Would you have me as a project manager?” I knew I have to surround myself with real estate 24/7. In 2014, I made that transition to a big developer down at Long Beach and work with them for about three and a half years building high-end luxury multifamily apartments. I've come through not only in engineering but through the tools into creating my own business. All of that being said, I was also doing deals on the side the entire way. I started my podcast. I was doing deals in New York. I was doing deals when I moved to LA and started buying multifamily co-syndicating. I was spinning all the plates and pumping. It’s a lot of hard work. It wasn't until I got married in 2017 that I was allowed to legally quit and be my boss.
I’ve got a funny story to tell you. I graduated from university with a degree in German Philosophy. I wanted to teach German Philosophy. I was a research assistant for post-Holocaust literature. I was going to be academic. If you've ever seen Animal House, I wanted to be Donald Sutherland's character who got high with the young coeds and stayed over. In my early twenties, that was the extent of my intellect. I heard a story that Socrates was a bricklayer. One of my philosophy professors said he had a job that paid the bills and took care of his family, and then he had the side hustle, which was philosophy. It turns out twenty years later, I can't find that and I can't prove it, but I believe fervently in having the support system base and then busting your butt and go do something else. There are some parallels here.
I didn't move twelve time zones away. After I finished uni, it was about 90 miles. I love the fact that you had that drive to do it. You found and created a way. Anyone who put a resume out on Indeed or the last time I did, it was Monster, you know you're getting hit by the algorithm. You get to New York, the love of your life and the city you love. You said you started doing deals. Tell me about that. Was that with a single-family or did you jump on to commercial?
Before moving to the United States, in the two years I spent after 2008 when I graduated as a structural engineer, I went to London and worked in the 2012 Olympic Games. In the middle of 2009, I moved to the South of France to be a deckhand. If you've seen the show Below Deck on Bravo, it was exactly that, but I worked for a Russian billionaire. It was in that time when I was in Spain on a weekend trip after running the bulls that I met Erica, who is the American girl that I fell in love with and who's my wife. I say that because I have to put it in context. There's a lot that goes on in this story before moving to the United States in 2012. After those two years of being abroad, I moved back to Australia in 2010. I’m back in an engineering job. I’m back in a cubicle going, “What am I going to do with the rest of my life?”
Like you, I enjoyed studying engineering. I enjoyed the academic side of it and the problem solving but being in the workforce, I was like, “This is crap. This is not what I signed up for.” I felt like a basketball player on the bench watching my life or the game go on in front of me. I was like, “I'm not going to sit in this cubicle for the next 40 years of my life.” That was the desire and that was in 2010. I picked up the book, Rich Dad Poor Dad. That was where it started. It was the a-ha moment that I needed to create financial freedom for myself. How do I go do that? You can do it through real estate. You can go through investing in businesses. You can go through stocks and bonds. I chose real estate because I was like, “I'm a structural engineer. I'd rub shoulders with developers all day long. I should pay more attention to my day job.” It’s like the blinkers came off.
I was educating myself in Australia doing the equivalent of a REIA in Australia, but there was only one of them in the whole country. It happened to be in Brisbane where I was from. I was going to do something in Aussie at the end of 2011 like a flip or a lease option but then decided to move to New York City. Some of the money I did save from my day job was lost moving halfway across the world. It was funny that I was like, “I can spend $38,000 and buy a triplex in Upstate New York and Syracuse. This is crazy.” Moving to New York City from Australia was like taking on information out of a fire hose. It's the Big Apple. It's networking on steroids. In Australia, we didn't have the established network over the REIA associations, which are around the country, which are incredible. Things that are available for $20, $30 door fee, you can get so much great information that I would have had to pay thousands of dollars in Australia or guru too because we don't have the same established education that you do here in the United States. Instantly, I was like a pig at a trough trying to consume all the information I could, nose in a book on the subway to and from work.
Within six months, I had chosen the market in Upstate New York because that's all I could afford. The barriers to entry here in the United States are much lower than they are in Australia. You could not find a property for $38,000. You could have anything. You can find a piece of dirt for $38,000. It was this whole revelation of like, “This is exactly what Rich Dad Poor Dad said, “Buy an asset and cashflow.”” I didn't have a car at the time. I was jumping on the Greyhound bus going to and from Syracuse on the weekends. The brokers would pick me up and go for a little cruise around. Eventually, I bought my first property for $38,000. The reason I had to use all my cash was because the banks weren't lending to me at the beginning. I didn't even know what a credit score was when I first arrived here. I didn't even know what an LLC was. I was learning all this stuff but still wanting to do a deal.
[bctt tweet="If you want to go and scale your business, you need to get into syndication. " username=""]
What it came to in 2010, I picked up Rich Dad Poor Dad and would come to the end of 2012. It’s two and a half years of self-education. It was like, “Come on, Reed, get off the pot. You've got to do something. You can only read so much about doing it. You’ve got to go and get your feet wet.” That's what I did and you don't get to deal number ten without doing that first deal. It was my own money. I was willing to risk it and it was a lot of learning curves along the way. That's the easy light way of saying it, but I'm sure we'll dive into what they were. I've done some flipping and all that good stuff.
I'm curious what was your response the first time you were looking to get some credit and somebody asks you for your Social Security number?
The Social Security number came six months after I even came to the country. It was like, “What?” The credit was like, “You can open up a credit card with your own money. You can put $1,000 down.” I was like, “This is a cool credit card, $1,000 and it was my money.” That was my interaction with the banks when I first got here.
You're close to a decade in and hopefully, you've got your credit score perfect. You're not a true American unless you've got a crappy credit score.
It’s coming through the border security like, “Be prepared, you’re not one of us until you do the rollercoaster ride.”
You get so far in debt and not knowing what you’re going to do. As long as that debt is paying for itself, that's the key. I like your limitations by being illegal or an alien.
That’s true, I'm an illegal alien. That's how exactly it was classified by the border agency. When you come through, “Are you a registered alien or illegal alien?” I said, “Yes. I am.”
It sounds like in a conventional way, you get into the single-family. You already went into more than one door on your first property, even though FHA considers that the 1 to 4 is still a single-family residence. You started there. You've done some flipping. You've been into this since in Australia. Once you got over using your own money and establishing some credit, who funded your deals for you when you're still in the single-family realm?
The first deal was all cash, $38,000. I partnered up with another bloke who brought in $10,000 and we split whatever cashflow is coming through. There was no hard money or private loans at that point. We're 50/50 on this one crappy little deal. From there, I was able to get a line of credit for $28,000, plus I was saving some more money from a day job. I bought deal number two for $45,000 and then started looking to do a flip in Philadelphia. Those first two deals, one was all cash. I proved to a local bank after 3 to 6 months of depositing rental checks that like, “These things are working. Can I please pull some money out or give me some line of credit?” They gave me a business line of credit for $28,000. From there, I was able to buy deal number two. From there, I was able to go and look at a flip in Philadelphia.
That was the extent before I realized my tether was going to be tight. There was a ceiling there. I wasn't probably going to get any more than those two or three deals in Upstate New York plus a flip in Philly with the modest income that I had in New York City. We can talk about the scale of syndication, how I've used that to power the business. That's how I got started in the first couple of deals. It was through my money and through friends and family. For the flip deal, we used construction hard money loans.
How did you get to Los Angeles? Was that your choice or hers?
My wife is originally from here. She was like, “I'll give you a year in New York.” I ended up staying for eighteen months. It’s a little bit under two years. We had a bit of time apart and realized, “She's the love of my life. I better shut up and move to LA,” plus I love stuffing, so this is the place to be.
You said your tether was going to be tight. What was your next move? How did you level up from there?
The big level up was a meeting that I had with a good friend of mine who had studied engineering in Australia. He was a Canadian fellow. He came down at the end of 2013. At this time, I have a couple of little deals. I was looking at this flip that I was about to start doing. I was about to move to LA. I was like, “I’ve got all these cool deals and I'm crushing it and there's $1,000 of cashflow coming in a month, but I’m still working...