RG 249 – Investing in Agriculture: What You’re Missing w/ Peter Badger
On this episode Peter Badger drops by and provides some amazing advice for us on investing in agriculture. Now this may be a little outside of the box on this show but it has strong relevance in terms of growing your wealth and living the passive income life that you want to live… where you want to live it. Peter dives into how “living the dream” can get super boring, how he invested in a Colombian coconut farm that provides incredible annual returns and why you, and everyone else, should be thinking outside the box when it comes to investing their money. There’s some amazing advice in here, so make sure you don’t miss it.
Peter Badger and his wife Karen Williams co-founded the Global Investor Alliance to help people obtain the mindset, strategies & tools to create recurring income from global real estate investing. Peter spent 25 years on Wall Street and in Silicon Valley while Karen spent 20 years in Management Consulting and Corporate Sales/Marketing. Today, real estate investing and education is their full-time endeavor.
We dive deep into:
- How to improve your property management skills.
- What mistakes to look out for when investing in property.
- How it’s easier to have a successful business in the U.S. compared to other countries.
- Be careful what you wish for because sometimes it’s not what it cracked up to be.
- How investing in agriculture changed Peter’s life and how it can yours.
- Thinking outside the box when it comes to investing.
So what are you waiting for?
Be Bold, Be Brave and Go Give Life a Crack!
Listen to Podcast
Peter Badger (00:00):
A couple of people who used to work for me, started doing, taking my advice and investing. And there’s one guy in California who I met him for lunch in mid 2018. And he said, Peter, he said, thanks for helping me out with this knowledge, I’ve applied myself with your techniques. I’ve now replaced my corporate salary. I can choose what I want to do in life. And, and that was, and he said, why don’t you teach other people how to do it formally? And that’s what we did. So Karen and I got together, we were both investing independently together on a couple of other family buildings. And we said, yeah, we can do this. Let’s start to get the message out.
Reed Goossens (00:45):
Welcome to investing in the U S a podcast for real estate investors, business owners, and aspiring entrepreneurs looking to break into the U S market join Reed. As he interviews go getters risk-takers and the best in the business about their journey towards financial freedom and the sheer joy of creating something from nothing good. I get a ladies and gentlemen, and welcome to another cracking edition of investing in the U S podcast from Los Angeles. I’m your host, Rick. Goossens good as always every with us on the show. Now, I’m glad that you’ve all tuned into learn from my incredible guests and each and every one of them are the cream of the crop here in the United States. When it comes to real estate, investing, business, investing, and entrepreneurship, each show, I try and tease out their incredible stories of how they have successfully created the businesses here in the U S how they’ve created financial freedom, massive amounts of cashflow, and ultimately create extraordinary lives for themselves and their families.
Reed Goossens (01:41):
Life by design. As I like to say, hopefully these guests will inspire all of my cracking listeners, which are you guys to get off the couch and go and take massive amounts of action. If these guys can do it. So can you now, as you know, I’m all about sharing the knowledge with my loyal listeners, which is you guys, and there’s absolutely no BS on this show, just straight into the nuts and bolts. Now, if you do like to show the easiest way to give back is to give us a review on iTunes, and you can follow me on Facebook and Twitter by searching at Reed Goossens. You can find the show, every podcast on iTunes, SoundCloud, Stitcher, and Google play, but you can also find these episodes up on my YouTube channel. So head over to Reed goossens.com, click on the video link, and it’ll take you to the video recordings of these podcasts. You can see my ugly mug with the beautiful faces of my guests each and every week. All right, enough of me let’s get cracking. And indeed, a days [inaudible]
Reed Goossens (02:38):
During the show, the pleasure of speaking with Peter Badger co-founder of global investor Alliance. Now, Peter and his wife are on a mission to help people obtain the mindset, strategies, and tools to create recurring income from global real estate investing and ultimately accelerate their wealth building trajectory. Peter spent 25 years on wall street and in Silicon valley, and today his estate investing in education is his full-time endeavor and quenches his thirst for purpose global travel and adventure to top it all off. He’s most passionate about the consistent income building capabilities of multifamily and intergenerational wealth building available through farm and agricultural investing and a top it all off his next pat. Like I am coming to America and making it happen. So I’m really excited to have him on the show today to share his incredible story with me, but not the enemy. Let’s get him out here. Good. I, Peter, welcome to the show head until I mate. Good.
Peter Badger (03:27):
How you doing? Thank you for having me. Oh
Reed Goossens (03:29):
My pleasure. Um, before we dive into the nuts and bolts, uh, where are you dialing in from today?
Peter Badger (03:35):
Uh, I’m dying for the mountains in the Rockies in Colorado. So very excited to be here for July 4th weekend.
Reed Goossens (03:42):
Yes. Yes. I think shutting down there in that
Peter Badger (03:46):
We’re opening. So we’ve been very fortunate and, uh, people wear masks and it’s been so good. Knock on wood, knock
Reed Goossens (03:54):
On wood, unlike here in LA, where we, 4th of July weekend, there’s no beaches, so we’re going to be stuck at home, but by let’s get into it. So the first question I ask all my guests, when we jump on the show is rewind the clock. And tell me how you made your first ever dollar as a kid,
Peter Badger (04:09):
Uh, paper round, like most young kids in our generation, maybe. Um, yeah, so I used to, I remember we used to do the morning round, cause you couldn’t get the evening rounds. That’s the easy one to get. They used to do the, you know, six mornings, Monday through Saturday in blustery, England raining most of the time for a pound 55 a week. How’s that? Wow. Wow.
Reed Goossens (04:32):
Wow. I don’t know if that ages you or you just, we were getting really
Peter Badger (04:35):
Shaky, right? Well, I think the worst thing was, is like a 12, 13 year old kid as he used to blow all that chocolate on a Saturday afternoon, the other wage. So,
Reed Goossens (04:43):
But maybe tell me a little bit about the story that coming to America story. Cause I I’m interested in it being an expert myself, coming to the land of quote unquote opportunity and really your journey. Cause I mentioned before, you’d spent 25 years. Sounds like you’ve been in the United States for some period of time because you did some Silicon valley stuff and you’re also on wall street. So maybe give us a bit of a background.
Peter Badger (05:01):
Yeah. The brief us story is I was M university in London and we used to get these American students coming across for the summers and I run the bar in the summertime to make some extra money and it got to be on a bunch of people and they used to invite me back and they actually paid for my ticket to visit Michigan state university. And I went back there and then, you know, quit college and I moved straight to the states cause it was kind of like, I just like the freshness and the positivity of American, you know, business and society in general, you know, because it, it, it is still true that you can achieve anything because of the size of the market in reality, you know, 300 plus million people and you can do things that you can’t do in smaller countries. And so I just loved the concept and moved into
Reed Goossens (05:48):
You, bring that up because I’ve actually spent some period of time in London as well. And Australia is very similar to this. It’s a British colony. Um, uh, it’s still under British rule, but it’s under the, but that’s sort of, I don’t wanna say tall poppy syndrome, but there seems to be, there’s just a different way of Aussies and Brits compared to Americans and sort of the, the land of opportunity. I don’t know if it’s an ego thing here, but it’s very enticing to a lot of us on the other side of the pond.
Peter Badger (06:12):
Well, I mean, I was asked to the first few years, you know, from my friends back in the UK, why you live in America because people have, you know, let’s say opposing views of Americans and the American lifestyle. Um, you know, I don’t, I don’t want to Brit bash, but this story is necessarily just slightly. Is that from a mentality standpoint used to say, listen, you know, if, if you see a portion of America, the Irish person look at the of, Hey, you know, it’s a beautiful car. I work kind of, I could achieve that in Britain that see the car in the street and they say, you know, you know, I’m jealous and scratch over the key now being slightly facetious, but the mentality of believing and frankly, you know, working hard to gain those advantages in life, happens more in America than often called countries. You know, like we’re from
Reed Goossens (06:55):
Interesting. Yeah. I find when I go back to have to quell my relative success and not talk about it too much, because I do get that tall poppy syndrome and people may not have left and they get jealous or not jealous, but, and I’ve had, I’ve had Americans tell me the same thing here in the states. So it just depends where you’re from and the fact that we have an accent here that you don’t really maybe come across it as much. Have you seen that part of it at all and your experience going back to the, the
Peter Badger (07:20):
Jealousy? I mean, I’m interesting because I was I’m in Silicon valley for awhile and I became a mentor as my starters back in London, Silicon alley, as we call it. And I, I’ve got to tell you in America, in Silicon valley, in particular, everybody you meet wants to help you and help you succeed back in London, people were taking pot shots, criticizing your business model, your belief system of what you’re trying to build, et cetera. And it truly is the lack of positivity, I think, which doesn’t allow certain places in the tech scene to basically break through. I think personally, and there’s, you know, it’s hard to be generic about this stuff. Sure. No,
Reed Goossens (07:57):
No, but I, I think I hear you on what you’re trying to say because definitely that abundance mindset, quote unquote, and, and I do see the other side of the coin where the, you know, from home and got friends and family, they think it’s all a little bit of a circle jerk, but you know, you need, you know, it’s, it’s once you’re in the thick of it and coming and doing business here, that you see that just the ability to, okay, you can pull yourself up from your bootstraps if you want to. Um, so I guess I’ve had a couple of other, um, experts on this show. What’s your experience been like coming to the United States and having that accent? Have they treated you any differently? Um, the open arms I’ve had some Australians actually say to me that in the south, at least they’re like, we love having, you know, the outages, we love having beers with Aussies, but when it comes to business, you know, all these strands need to leave the room and I’ve had the complete opposite, you know, experience. So I was wondering, what’s your experience been today? It’s been a hundred
Peter Badger (08:44):
Percent positive. I mean, people listen to him because of the accent and I open doors more because of the accent. Cause we’re different from everybody else. They’re here. I think for me, I mean, I moved to New York city in my twenties early after college. And so you can imagine it, it was like a kid in a candy store from a business opportunity, you know, relationship standpoint. And so, yeah, I think, um, we get away with a lot more, you know, I think it’s, um, you know, it was, it was all positive on all that, having English accents in America.
Reed Goossens (09:14):
And I think that the big things that you mentioned, Silicon valley, you mentioned New York, you mentioned, you know, you’re calling in from, you know, you now live in Denver, they’re very world cities, you know, they’re very the boiling pot of different multicultural centers. And it’s, it was, I remember my nervousness coming to the United States, trying to get a visa, you know, for a job and then realizing. And when I went to New York, everyone was buddy a foreigner, you know, so everyone was on a visa. So it wasn’t like, it wasn’t my own, you know, it was my shortcomings of thinking, you know, I’ve got no one’s gonna offer me a job, but it’s like, oh, you got to basic. Cool. Yeah. Get in the line with, with the other guys that there’s 10 other people in this company that don’t do the same thing. So, but mate, tell me a little bit more about how you got into the world of real estate investing and now starting global investor Alliance, because this is really the nuts and bolts of, of the life you want to live. And, and really when was that apifany moment of saying, screw this corporate world and screw Silicon valley, and I’m going to go out on my own and try to create something from that.
Peter Badger (10:05):
Well, so I think I had kind of two phases to my journey. So I spent 18 years on wall street, you know, living in New York, Tokyo, Hong Kong, you know, Zurich back to London for a while. I did all the financial centers and I drank the Kool-Aid. And so from my perspective, I, you know, it was all about stock market. And then, um, I did get bought for 18 years of all the corporate, you know, meetings and politics mainly. And I was like, let’s go and start my own business out a couple ideas, a search for a few years. And then I jumped out to Silicon valley. I was living in Northern California in Marin county, just outside of San Francisco at the time. And we basically, me and my co-founder Steven, we started a tech company in the enterprise software space. We did bootstrapping for a couple of years, VC funding series, a series B raise about 24 million bucks.
Peter Badger (10:53):
And it took about eight years to get acquired. And so my actual real estate journey, even though I’d had some single-family home rentals, a couple prior to that date, it wasn’t until I actually had the excellent Silicon valley that I had to start thinking seriously about what to do with my assets reality. And so the funding just to stay there for a second, I mean, in Silicon valley poems, people ask you, did you have a single, a double, a triple or a home run? And just to give people who are familiar with this stuff, you know, a single as 50 million or less exit, a hundred million double 500 million billion. And so you get the gist here. So my mind was a single and once federal and California state tax had been taken out, you know, it was a, it was a few million, but I had to really think seriously about what to do with that.
Peter Badger (11:46):
So I started surveying everybody in my network by now I’d gone from corporate wall street, people to Silicon valley and entrepreneurs. And the message I received was actually quite interesting to me because it was, everybody said, you can only build your wealth through real estate, even, even the Silicon valley people, most of us are gonna validate, but because yeah, you had a few, are they all boys and been through corporate careers like I had. And they were like, yeah, stock market stock market, where else I’m going to put it, you know, one of those kinds of things. Uh, but, but there was a whole raft of people who were mostly founders, CEOs, multi-asset guys, and one woman, sadly, it’s a bit of a demographic issue over there. Um, but basically they all said, listen, don’t put it in the stock market. It’s a bit of a gambling routine, put it into hard assets, real estate, mainly being that one gold, et cetera.
Peter Badger (12:42):
And so I actually went through and interview people and I got a couple of contacts that network with them. How do you buy real estate? And I went down this path actually, and I probably met the wrong person to start. I started buying single family homes. And so the really important thing about my journey was I went through four asset classes to really learn the mistakes I’ve made early on over a, probably a four or five-year period. And so it was classic. So I kind of like met some network that was saying single family homes, turn key, you know, living in California, you know, like the house we were living in, you know, middle, a couple of Miller’s then California nowadays, and then right, was near the big cities. And you could buy a three bed, two bath, two car garage house in Florida or Texas for a hundred grand.
Peter Badger (13:28):
And I was like, what is this land of like, you know, non-California non New York housing. So I went on this journey. And so I, I basically started buying single family homes and what most people don’t realize as an American resident or citizen as you can actually have 10 traditional mortgages per person. So if you’re married, you can have 20 traditional mortgages. So you could buy a hundred thousand dollar home, basically have a 75 grand mortgage with 25 down plus two or three rent and close. And you can just start building a portfolio that way. And they start bringing in between three or 400 bucks in cash flow. And that’s a turnkey, there’s no value out of that point. And I started doing that. And so over 18 months I actually ended up buying 21 single family homes. And it was great because they were turnkey.
Peter Badger (14:16):
They had just been renovated. You know, I was lucky with some of the people who had been renovating them. So they were like pretty high quality. And I mean, you know, so people don’t talk about money in real estate much. So I’ll kind of give a flavor for this. And so, um, I was earning net income about 12 grand a month on those 21 single family homes, 13 with cash and in some markets. So I had like four houses in Pittsburgh, Pennsylvania, and you couldn’t get a mortgage because they were like 50, 60 grand. And no one’s going to bother getting a mortgage for 30, 40 drinks. It’s not worth underwriting, frankly. Um, so I shaped this portfolio of three different states, Pennsylvania, Florida, Texas 21 homes at six property managers. And it was all going fine, 12 grand a month, 6, 7, 8 months counting. But the year mark things started getting a bit dodgy.
Peter Badger (15:09):
Let’s call it because 10 started moving out and then I realized like quickly, well now I’ve got a tenant vacant house. I’ve got mortgage in some cases, taxes, insurance, and I’ve lost this for six weeks, got some rehab costs, repainted fixing the stuff that broken. These are by the way in the kind of life C plus B minus markets. So it wasn’t a greater tenant base for some of these neighbors for the a hundred grand housing. So I went through this journey basically, whereby my income would go from 12 to 10 to 10 and a half to seven when somebody broke in a house and stolen an air conditioner when it was empty for a month. I mean, I mean, so you go through the single family journey. I had six property managers who really, you know, it’s hard to find these in property managers to be known.
Peter Badger (15:55):
So I ended up in like at the end of this two year journey, I was at this real estate meetup in Tampa. And I advise people listening to this, watching this on YouTube, whichever channel go to property meetups, Andy, any way you can just network all over the place. And so I picked up in is Tampa, Florida prompting me to, I’ve just been seeing a property manager to work out why my two houses are empty, you know, work out of fix this stuff. And basically one of the meetup happens. You have an intersection where you all give your 32nd elevator pitch thing of a bit of a presentation thing in network at the end. And so I gave my elevator pitch. I thought it was a bee’s knees. You know, I was like, yeah, my name’s Peter. You know, I moved to America, did a bit of wall street, Silicon valley.
Peter Badger (16:41):
I gave my BS story, oh, by the way, I’m financially free. I own 21 single-family homes. That was my 32nd pitch. And I was a little bit arrogant. Say the least. And you know, it’s, it’s, it’s hard to look back on those days who I was. And I was a bit full of myself and this guy at the end. So the presentation came to me and said, well, he said, well, you’re an idiot. Go ahead. I’m like, what are you talking about? I was like, taking it back. I’m like, oh, whoa. And he said, what you should have done is you should have bought one or two single family homes to understand the mechanics and how it works. And then started buying multi-family buildings because you could have saved up a hell of a lot of hassle. You could have bought like two homes and then bought a 20 unit, saved yourself 18 months of hassle efforts.
Peter Badger (17:28):
Oh. And by the way, your business model is broken because if they break, yeah, you got 21 roofs to fix. If you’ve got central air, you got 21 air conditioning units, you’ve got plumbing. You’ve got, I mean, you know, we know the game. And so it’s like, you’ve got infrastructure issues. Your expenses are high. You’ve got single tenant fault lines in every property. You have buy a 20 unit building three or four or five can leave if you buy it. Right. You’ll be fine. And that was like a real eye-opener. And so after being shocked by as you know, initial, Colombian idiot, I actually pivoted quickly to multi-family and I bought a couple of buildings and sold a bunch of single family homes at 10 31, which is avoiding capital gains into these homes. And, um, and that was a classic and I’m, so this journey just continues to the asset classes.
Peter Badger (18:20):
So, you know, you’ve got another meter. I was going, I was doing three or four meetups a week, by the way, during the peak season or whatever state I was visiting to either look for housing or further from multi-family to do my analysis of properties and men another couple. And they were into mobile home parks. And they were like, well, why are you buying multi-family buildings? Because in mobile home park, there’s no building is offered a pad. You got a piece of concrete and a couple of utility connections. So what are your thoughts around that? You’re an idiot, you know, and then my journey ended, like must been a few months later than that. And there’s like some, some personal madness that, um, well, I’m sorry if you’ve got it all wrong. Why wouldn’t you buy agriculture? Because there’s no concrete patio, utility hookup.
Peter Badger (19:05):
I mean, I mean, I’ve been through this journey and I think what I’ve concluded is, and what we teach our investors in the Alliance is really two asset classes predominantly because that’s been a consistent bill to make money and build my wealth on those two assets, asset classes. And so the first one is multi-family in the United States predominantly because the us is probably one the most predictable and consistent real estate markets on the planet. There’s so much data that you can analyze around market cycles. You know, there’s 400 MSA metropolitan statistical areas. We have all the data from both the Metro area down through the zip code, down through the actual neighborhood block by block, where you can work out, you know, population growth, job growth, hopefully lowering crime rates, um, medium condo house values. I mean, I, it, it frustrates me meeting people who jump into real estate because some mates a broke, you know, real realtor and said, oh, you should buy one of these.
Peter Badger (20:12):
They don’t do this analysis. So, um, you know, to, to summarize the us multi-family real estate, there is so much free data out there to help you analyze and a top down or bottoms up basis. But whether that market is worth investing because it’s growing or not, and then you can do the analytics on the, on the actual asset itself at that point. And so honestly, if I was to tell anybody anything, it’s, you know, look at multi-family, um, smaller buildings or syndications, if you went to clubs together with other people and, and that would bring you consistent wealth building over the years, I want to echo
Reed Goossens (20:47):
Of the things. I think the one sentence you said that 400 MSIs I’ve been quoting that term for the eight years. I’ve been here. You know, when they say, oh, the us housing market, you know, particularly when I’ve just after 2009, they all the us housing markets like, well, the us housing market actually has 400 different MSIs. And within each MSA, there’s a certain blocks also north, south, east, west, west side of the tracks, east side of the tracks, you know, and, and you need to be north of a certain strudel south of a certain street and very block by block. And that was one of the biggest things I learned moving to this country is just how it is. So block by block and how there is the primary markets that we talk about. And then the, you know, the new York’s, the Las, the San Francisco’s of the world, but then there’s the secondary tertiary markets because the population is so massive, right?
Reed Goossens (21:26):
350 million people, I think it is. So you can inhabit north, south, east, west where, you know, coming from Australia, we’re all confined to the coast. So it’s just completely different scale here. One thing we’ve obviously spoken about a lot and multi-family here, but really I’d love to get your 2 cents on the agricultural side because I’ve never actually interviewed anyone about agricultural investing and why I loved your analogy of all the, you know, single family. Well, you’ve got all your 20, 20 roofs. Oh, you got to go to multi because he’s got one roof, you know, and then I, I screw multi, you don’t even need the building. You just need a base, you just need a pad. I’ll screw that pattern, that utility, you just need a good culture. So I love that sort of journey through that. So tell us a little bit about agriculture and why, why you love
Peter Badger (22:06):
It. So, yeah, I think for me, I mean, so I, in my interview, actually, when I exited on Silicon valley, I was jumped some very wealthy people. And actually they put me in touch with their financial advisors. Let’s call them. And it’s a whole different ball game. I mean, it was an area that I had never been exposed to. And I’m like some like working class, British family, you know, have to have made reasonably good in America. Um, advisors give names or the family they manage, but they manage the portion of one of the major Silicon valley families. And he said to me, he said, listen, Peter. He said, um, and, and this is early on in the journey, but didn’t really twig at the time. He said, most high net worth family offices can own between 14 and 22% of agricultural assets, 14 and 22% has to pass well through the generations.
Peter Badger (22:56):
And so I’ll give a couple of scenarios and this is where I’m at right now because I, I kind of listened to that, but I didn’t know what to do with it. What, what do you do with that statement? You know, and so I just haven’t because when you’re full-time in real estate, I was fortunately, it was at that point, I was networking. I just kept meeting these peripheral people and also now start to travel. And so we’ll come to this later, but my, my partner, Karen and I were living the nomadic lifestyle, traveling around the world, doing real estate deals. And the more you travel outside the U S the more you see farmland and agriculture, especially in central and south America, but amongst your network and the people you meet. And so I’ll give a couple examples of why, of course it works for us.
Peter Badger (23:38):
So you should think about it like this. We’ve got a, we’ve got a coconut farm in Monterey in Columbia. So we took 300 hectares. We planted 32,000 coconut trees. And so the beauty about his investment is that you can’t get any income for five years because you basically have to clear the land, lay that drainage, make sure there’s multiple water sources, make sure it’s in a location where there aren’t any weather disasters. So outside of the hurricane belt. So from down to central America, Panama downwards is my advice. And you basically find the right multi-generational farming team because there’s risks in every investment. The question is which risks you take. And so in the same way that a property manager is hard to find a decent finding decent multifamily generational farming teams is also hard, but if you do enough research and you have the right contacts, you can do that.
Peter Badger (24:31):
And so we’ve planted 32,000 trees took about 18 months to go through and do that. And then over a five-year period, they grow. And I’ll give a bit of the economics of this farm investment, 32,000 trees. Each coconut tree will produce on average, 175 coconuts when they’re fully growing. That’s a year five on a yearly basis. It’s a permanent crop. Now talking about row crops in a second. And so when you look at that 32,000 trees coconuts, I could walk out the front of that farm and sell a regular coconut 50 cents. That’s the worst case that sell the coconut. And so you look at the numbers and you kind of like you got two and a half million plus from that farm income every year, it costs us less than a quarter of a million to run that farm that we have. And you’re looking at the margin, it’s like software margin.
Peter Badger (25:29):
It’s like being back in Silicon valley, and that’s the worst case based model. You know, how are we going to sell our coconuts? We’re going to basically creating processing house and doing coconut water because the actual profit on coconut water right now, and the growth of that market still, that can’t get enough. And this is an organic farm, by the way, this used to be a cattle farm. We converted. So it hasn’t been ruined by big ag and chemicals. We basically sold all the cattle off. We use the revenues, we went through the first five years of the cattle, sold them off to run the farm. And, and here we have a beautiful organic farm. And we’re now starting to see those trees blooming via five. And so this is the model here. And so you look at those economics and this is by the way you plant a tree, it prints money or produces coconut between 60 and 80 years. So I’d like to think that I’m Walt Disney and I’m going to come back later in life. But this is for my children. This is the past wealth multi-generationally. And that is what high net worth families do.
Reed Goossens (26:34):
Talk to me about just a little bit, don’t get too deep into the product itself. Like you say, you took a existing cattle farm, which Catelynn itself, uh, is an agricultural, you know, investment, why coconuts and, and, and how do you, how do you decrease the risk on knowing that coconuts will be wanted for the, for the, for the, for the next 20, 30, 40 years?
Peter Badger (26:56):
Well, so, so I think the beauty thing about coconuts is every bit of the coconut can be used the huts, you know, the water. I mean, every piece of that can be used for many uses oils, beauty. I mean, there is as a, as a crop, there is not a failure business case with that crop. And so I kind of talk, um, I mean, we could go on for hours, but this is the problem. And so rich and I spend between two and three months of research on every different crop, permanent or row crop I go into. So
Reed Goossens (27:30):
What are your top, what are your top fives these days?
Peter Badger (27:32):
Um, citrus, it’s all about pineapple, um, limes. I mean, I mean, anything that is like high quality citrus fruit, there is always a demand for it. We have to remember, we’re not doing this at scale. You know, we’re doing this in raising, you know, we’re, we’re, we’re with farming partners. We help them raise three to $5 million between the farming partner and ourselves, and couple of other providers. And we’re building small scale farms and we have distribution network through the flight, mostly Panama canal through sea container, depending on the prop to Europe, middle east China, South Korea in some places. And honestly, you’re always going to get a market for premium citrus products as an example, you know, because interesting that they’re looking for high quality, high sugar, high color, and if you got the right team and the other Ryan investors behind it, and you capitalize it well, and the right distribution network, you can make a lot of money.
Peter Badger (28:34):
And so my, my standard pattern is for people getting into this is to say, you know, starlet, multi-family put 50 to 60% of our wealth into multifamily, hopefully value, add assets and build that foundational wealth in a predictable and consistent market. Now, when you got that, only when you are there, start to diversify overseas and hopefully Eric or assets, which can then take away from the U S dollar in case the, you know, the world bank says get lost in case of 23 trillion becoming 30 trillion becomes ju um, basically, you know, start to diversify you in different currency, different country, and more reportedly in a generational asset, which can pass through to your kids. I know, as
Reed Goossens (29:20):
In personally myself being a foreigner, and I’m sure the same goes to you, part of what I think is a bit arrogant, but my superhero powers are, is my international perspective. The fact that multi-family doesn’t even exist in Australia. You know, we don’t have the funding mechanisms to fund it on a build to rent model. And so it’s always, it’s con it’s a condo.
Speaker 4 (29:41):
How, how has your, is your superpower?
Peter Badger (29:44):
Yeah, I mean, the beautiful thing about being international, having worked on wall street for 18 years and lived in every major city is I saw real estate in every country and globe. And so I just needed
Reed Goossens (29:55):
Everywhere. Right? It’s a human need. We need shelter. It is.
Peter Badger (29:57):
But you also get to the point where by, I know I, the first thing I look at when I go into a city is unlike what’s a square foot place was barefoot of like a single family home in this neighborhood. You know, because, because I know that, you know, in Marine county where I was, it was $1,250 per square foot.
Reed Goossens (30:16):
Well, I know here in the neighborhood, we just bought a 650 bucks a square
Peter Badger (30:19):
Foot. Well, that’s a bargain mate.
Reed Goossens (30:23):
Well, hopefully it’s, it’s, it’s a gentrifying neighborhood. Put it that way.
Peter Badger (30:26):
And I also know for instance, that you can buy a beach near the beach two or three blocks back in plateau, Carmen Riviera Maya in Mexico beach condo for $250 a square foot. And so you have to be able to understand this ladder of asset type by country, um, and really have a feel for that. And that’s what my global travel background actually has allowed me to do. I think so I can, I can walk into any country in any asset class and getting a gauge on whether it’s worth going here or not, you know? Well, and
Reed Goossens (30:59):
Then let’s, let’s pivot into the global investor lines in this freedom lifestyle. Cause in the green room prior to pressing record here, we spoke about the freedom lifestyle. And I don’t want to get to that in a little bit in how you pivoted, but let’s talk quickly, just a little bit about the global investor lines. It’s obviously an education platform and tell him the answers to the test. Um, but why did you want to start that? What was the, the reason to going out and trying to help educate others about the benefits of your investment thesis first and foremost, in, in, in multi-family, but also in agricultural and globally, right? Global investor wants not American Gluster investor license, global investor line.
Peter Badger (31:35):
Um, there are so many reasons, a couple of them, I’ve got a lot of friends in the UK and Australia who could not buy a property because they can’t cash flow, but wanted to find a way to get them into the American and other international markets. Not only give them the comfort and the education to do that. The other side is that actually just, this came out on that sheet by mistake because when you’re in real estate, when I’m doing this stuff, you know, and posted stuff on Facebook, sadly, and sort of stuff, talking about stuff, and I get mad at people for lunches and, and a couple of people who used to work for me, started doing, taking my advice and investing. And there’s one guy in California, Rudy, who I met him for lunch in mid 2018. And he said, Peter, you said, thanks for helping me out with this knowledge, I’ve applied myself with your techniques.
Peter Badger (32:20):
I’ve now replaced my corporate salary. I can choose what I want to do in life. And that was, and he said, why don’t you teach other people how to do it formally? And that’s what we did. So Karen and I got together, we were both investing independently together on a couple of multi-family buildings. And we said, yeah, we can do this, that start to get the message out, because that needs to be me to bridge the divide. Frankly, those high net worth families shouldn’t have all that knowledge to make. No, no, I don’t want to get into this, but 1% richer and richer, you know, I want know regular people like us. I mean, I was fortunate with, you know, getting a bit of money to invest, but many people we know could do this. They just haven’t got the how or the knowledge. And so when let’s give them the confidence, the models, the techniques, and the ability to do it.
Peter Badger (33:05):
And that’s what, so we have an eight week program to walk people through that you spend the first couple of weeks working out the mindset stuff, because it’s all mindset. If I had a dollar for every time somebody joined our Alliance. And then after like the first two weeks said, well, you know, my financial advisor said, real estate, too risky. You should keep it in the stock market. I’ve just like, I pull my hair if I had any, you know, but it’s like, it’s frustrating. And I’m like, listen is the gay wall. Street is a marketing machine. You know, it’s, it’s legalized gambling, you know? And so go up on my soap box because they’re not real assets. You know, we all understand that the thing about book value of the company and sentiment based market value. And that’s when the dip happens is when the sentiment disappears. Your portfolio disappears
Reed Goossens (33:52):
In your explanation of that. You wanted to be, have this, this 1% mindset slash 1% access to deals to the rest of the world, to the rest of the population. And not that you need to be in the 1%, but you can just do a few things differently to potentially replace your job and have more time with your family and have the time freedom, which brings us into the next question, which is, you know, what I first met you, and I know a little bit about you, you know, your, your whole drive was to live in a sort of, we’ll call it tax Haven type of freedom lifestyle and not have any things attached to you from, from having to pay the uncle Sam, but that’s changed. Maybe fill us in what’s what’s happened in the last couple of months since, uh, you’ve moved back to the mainland. Well,
Peter Badger (34:32):
So we lived over three years in 17 different countries as a kind of nomadic lifestyle sounds busy. And so I think, I think I wanted to prove that I could play the tax game. Let’s say I’m an American citizen, as well as British, so on tax my world riding. So anything I can do to try and find tax benefits overseas, and there aren’t many legally as a us citizen or resident that you can actually attain overseas. And so we were, we were both trying to invest overseas by traveling a lot. We were living overseas to be nomadic and have a life of freedom that everybody like, uh, teams wants to attain. And we actually ended up in Puerto Rico because Puerto Rico became is the tax Haven for American passport holders. And, you know, long story short, you pay 0% on capital gains and dividends and you pay 4% on your company income and how we going into those finer details.
Peter Badger (35:35):
But what we realized was in Puerto Rico was we became very bored very quickly. And so I would, I’m embarrassed to admit, but the dream of living in the Caribbean by the beach with the freedom we had is the dream of that is better than the reality of it because there’s nothing to do there. And you get up every morning and you walk down the beach for three hours and you know, all the dogs in there. And then again on a couple of conference calls, coaching people on investing in, and I’m like, well, there must be more to this than that. So actually we moved back. So I, I did my analysis and all the 400 NSA’s kind of sat in that way. And Austin, Texas came out, number one, further lifestyle ones, real estate, um, approach Denver was number two. And we chose Denver because, um, you know, it’s a beautiful outdoors mountain lifestyle place when we live. So, so now we have bars, restaurants, entrepreneurs, as a tech senior, a lot of real estate deals are going down and we’re actually, you know, happy as Larry on this location now. So it’s been a weird journey. And
Reed Goossens (36:41):
So you’ve had to give up that sort of zero tax pursuit, right. But I guess, and that’s really important for the listeners to hear that one that living on a beach, ain’t all, it’s cracked up to me. Right? And for most people, the reason it ain’t cracked up to me is because we are all inquisitive human beings, right? We want to continue to be challenged. And when we want, when we don’t have that challenge or that, you know, that entertainment was going to use wet entertainment, then we start to get bored. And that’s where the challenge piece, we don’t then fulfill our needs as human beings. And we want to keep pursuing it and then being surrounded by other like-minded individuals when you’re sitting in the Caribbean and you, a bunch of tourists are on holidays. Like, uh,
Speaker 4 (37:23):
You don’t want to talk business, you know,
Reed Goossens (37:25):
You know, I could see it happening. It could becoming old rules.
Peter Badger (37:28):
Yeah. So the problem of Puerto Rico was it’s either retirees or tourists, but I think the bigger problem for us over three years was we had no community, nomadic community is not a community. You’re no matter community is a bunch of nomads who aren’t tethered to anything or anyone. It sounds
Reed Goossens (37:45):
Like being the biggest realization to you. And
Peter Badger (37:47):
Karen is that right? I think at the end of the day, nothing matters more than, you know, family, friends and an entrepreneurial network we can learn from and grow and help others do the same. But life pivot really well
Reed Goossens (38:02):
When you also bring up a good point that it’s like being an entrepreneur is lonely, right. It is a lonely gig. And until to be surrounded by the reason I do this, I’ve been doing this podcast building five years because I get to talk to people like yourself, we’re on the same wavelength. Right. And you’re living in Denver, I’m living in LA, but you know, when you don’t have that on a consistent basis and you can sort of touch and feel each other, like at a bar or, you know, in a networking space it’s yeah. I can see how it gets pretty. It gets pretty lonely pretty quickly, but it’s interesting. We welcome back. I should say, um, we’re coming due. We are coming to the end of the show. So I do want to, I do want to be very respectful of your time, but what’s of 2020 got in store for you guys and beyond with global investor Alliance and agriculture and multi-family.
Peter Badger (38:41):
Yeah. So I think we’re all in a bit of way mode aren’t we, we were fortunate, you know, our assets are performing very well, you know, shelter, shelter in place, or stay at home, whatever your term is, your country is a beautiful thing. When you own multifamily real estate, you know, um, and agriculture, we can’t produce enough fresh fruit because you know, every needs, um, produce and that’s the beauty of it. So I think, you know, knock on wood. I’m hoping that the quality and style of multi-family, we’re both in growing cities that a lot of white collar workers who have just been at home, working with the regular wage and the agriculture angle, um, is pandemic proof. That was never in my risk matrix by the way.
Peter Badger (39:25):
But I think for us, it’s, uh, yeah, we’re, we’re kind of like waiting for the end of summer cares at stimulus checks and see whether we’re, uh, you know, the alphabet shaped recovery, the V the w or the second way that you, the owl. So I think in reality, we’re bringing new members in now, we’ve got a post lockdown special at the moment, because I think there’s no better there’s, there’s no bad time to, to get to knowledge to start. And two things happen either this iconic has gone through the election and beyond because the fed will keep pumping money into may that happen. Um, or if they crash, we expect amazing bargains to be had on all fronts. And that’s the beauty of it.
Reed Goossens (40:08):
The big thing, your two things is like one, this ain’t going to be the first and last pandemic we ever seen. Right know now as a new wrinkle, probably to your curriculum and to our investment thesis. Um, but two, we have we’re now down now are in recession in three, um, w we have civil unrest, you know, and I don’t want to get into that, but you know, the other, the other thing is missing here is a world war. So, you know, with the four things that really can, can dictate, and we’ve got three of them. So I think it’s, it’s, I think it took the wives coming in. And to your point, like with the election this year, we’ve got, you know, how long the Fed’s going to keep propping up incomes, it’s gone. And then there’s going to be the residual, you know, quantitative, easing post, you know, stuff, which will only help once you’re invested in hot assets, in my opinion. Right. But in saying that the only other silver light to this and giving your international like myself, is that this is not an American problem. It is a worldwide problem. And, you know, rents June Australia, it’s Joan London, it’s John Mexico is Jew in Canada, and all landlords are sweating it right now. So, um, and all, all countries have to stimulate the economy. So we’re, we’re all in the same boat together, which gives me a little bit of solace compared to say 2008 was really just an American person.
Peter Badger (41:15):
Yeah. And it was also a housing problem mainly. And so the only thing I’ll say to list is, is listening. It’s, um, you need hot assets because this may be a deflationary environment for awhile, but eventually inflation will come back. And so the only way to beat inflation is to own hard assets. And because the value goes up with the currency and the store, I mean, I can’t lay it out any simpler than that. So if you, through the real estate, stop building now, love it, love it.
Reed Goossens (41:46):
All right, mate. Well, at the end of his show, we’d love to get into the top five investing tips, really get into it. Mate, what is the daily habit you practice to keep on track towards your
Peter Badger (41:54):
Goals? I set a schedule to get up in the morning, block out the time and actually shower and dress as if I’m going to work. Because especially in these shelter at home periods, it’s so easy to have that discipline of getting up and showering. Honestly, that’s as simple as it gets. Love it.
Reed Goossens (42:11):
Love it. Um, question number two, who has been the most influential person in your career to date?
Peter Badger (42:16):
I am reasonably successful because of many mentors. I could not name one or two, honestly, because I’ve probably been mentored by 10 or 12 of the top people in asset classes in different global locations. Um, yeah, it’s really hard for me to kind of pinpoint, cause I’d be dissing off the other 11 fives to say I’ve had my most growth in life because I’ve had admitted to myself that I don’t know much as you have that mentality. And you look at everybody as an opportunity to learn then that, that is what I go through life with. And it’s served me well
Reed Goossens (42:56):
In your business. What is the most influential tool? Now, when I mentioned tool, it could be a journal. It could be a physical tool like a journal or a phone, or it could be a piece of software that you use on a daily basis. So, so what’s the most influential, influential tool in your business.
Peter Badger (43:09):
I’m going to give a tool with the people. So we use slack and we had our Alliance members in there. And so here’s the beauty of the Alliance and YSA slack. Plus the people, our Alliance members, when we bring it deals with the portal, we have, you know, 60, 80, a hundred sets of eyes on that same deal or with different views of the world, different blind spots that don’t know about. And we become better investors together. And that tool allows us to get in these meeting rooms to discuss an investment in detail. And so to me, that’s the collaboration angle with our Alliance members. It’s been, we’re better investors because of it. I learn more from my investors than they learn from me, honestly.
Reed Goossens (43:51):
Right. And it goes back to that the, the wanting and needing the community, which is part of why you transitioned your freedom lifestyle, which is really, really important. Uh, question number four in one sentence, what has been the biggest failure in your life? And what did you learn from that?
Peter Badger (44:04):
My biggest failure was buying some brief beachfront real estate in Brazil, from a marketing brochure, having never visited it. So we all have to make the first mistake, look at the marketing brochure. You trusted somebody through somebody, you didn’t do the due diligence. So if you ever invest in real estate, go and visit it, or have a trusted third party who truly is trusted, go and visit it on behalf. Never invest blindly. No, I think that’s so important. We
Reed Goossens (44:35):
Get so caught up with, uh, the keeping up with the Joneses and the looking like, oh, we just made this investment in Brazil, darling. You know, it feels so glamorous, you know, and not realizing it’s a really crap deal. So my last question is where can people reach you to continue the conversation they want to be in your sphere?
Peter Badger (44:52):
Yep. We are out to global investor alliance.com and there’s a little button there. You can actually click on chat to me if I’m awake depending on the time zone. But, um, yeah, so, so honestly we’ve got a great group of people. Um, a lot of them even more educated than I am at this point. And so, yeah, I think, I think that we, as a human beings invest better together. So you don’t have a group of people, you know, if your family members are saying, oh, don’t get into real estate, you’ll lose money because they’ve all heard these stories, you know, find the right group of people, whether it’s ours or somebody else’s to collaborate with and learn with and do deals with, because you’ll become a better investor by doing that. Awesome, awesome
Reed Goossens (45:31):
Stuff, mate. Well, look, I want to thank you so much for jumping on today’s show. I just wanna reflect some of the things that I took away from today’s show as a bit of a summary. I think the biggest thing that I’ve learned from you is one your ability to pivot really quickly, but to your humbleness in not knowing everything and being, uh, being able to that old saying the trick of all trades, but master of none doesn’t necessarily apply to you because you’ve been so humble in your approach. And you’ve surrounded yourself with people who do know what they’re talking about and taking bits of advice from each people on along the way, and then planting those seeds in your own investing career to help you see the brighter future. Um, and I love the fact that the blinkers have come off with the freedom lifestyle around community and people and being more focused in and around that and having to give up some of the tax benefits, but you, you have such a better lifestyle and you’re so much more mentally stable than maybe living on a beach in the middle of nowhere, bored shitless, excuse my language.
Reed Goossens (46:22):
But did it, did it?
Peter Badger (46:25):
No, I think that’s it. And just the thirst for learning. I mean, I’m never going to stop. So network learn, educate yourself, just continue the rest of your life. It’s a never ending journey. Love it. Love
Reed Goossens (46:36):
It, man. Well, again, thank you so much for jumping on today’s show. We’re going to catch up very, very soon. Enjoy the rest of the week. Happy 4th of July and
Peter Badger (46:43):
We’ll catch up very soon. Take care.
Reed Goossens (46:47):
Well, they have another cracking episode jam pack with some incredible advice from Peter. And if you do want to go and check out any of his stuff, please head over to global investor Alliance. You can Google that, or you can have a pet over to my website and see the show notes. And all the links from today’s show will be up there. If you do like this show, the easiest way to give back is by giving it a five star review on iTunes. And I want to thank you all again for taking some time out of your day to tune in, to continue to grow your financial IQ. We’re going to do it all again next week. So remember be bold, be brave and go give life a crack.