Brandon Cobb - Vertically Aligning Your Real Estate Business For Growth
LISTEN TO THE FULL EPISODE ON:
What happens when you're in medical device sales and you realize you want to take control of your life and build the life you want? Meet Brandon Cobb! He got his general contractor license, jumped into real estate and now manages $22M of new development and has active ownership in $33M of commercial real estate. Based out of Nashville, TN, Brandon owns HBG Capital, HBG Construction, and works on ground up new developments, land development, residential property rehabilitation, and commercial multifamily acquisitions. Brandon shares how he's build his company through hiring A+ people, building strong systems and processes, and how he brings in investors to help him grow!
In this episode, hosted by Mike Swenson, we discussed:
- Brandon's transition from medical device sales to real estate.
- How Brandon grew from a newly license General Contractor to running a large real estate business.
- The challenge for the people starting out is they don't know how to find money.
- Finding money takes a lot of time and effort in pursuing the right relationships.
- The natural life cycle of an investor is “If we help you invest your money, then you'll invest more money with us.”
- The goal is to diversify into commercial and multifamily depreciation wherein investors can offset their income.
- Brandon wanted to focus on asset classes that provide insulation against market volatility.
- Finding top talent meant hiring people into future growth opportunities.
- If you want to grow a hyperfast organization, hire strategic partners.
Timestamps
0:00 – Intro to Brandon’s Career
4:24 – How Brandon Began In RE
6:54 – Working in Construction
10:54 – Target Areas
14:01 – HBG Capital Finance
18:15 – Building and Growing Team
20:02 – Investments in Commercial Space
22:00 – Investor Experience Roadmap
25:51 – Principles in Hiring People
34:58 – How to find Brandon
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Full transcript here:
Mike Swenson
Welcome to The REL freedom podcast where we inspire you to pursue your passion to gain time and financial freedom through opportunities in real estate. I'm your host, Mike Swenson. Let's get some real freedom together. All right, welcome everybody to another episode of The Real freedom podcast where we talk about building wealth and gaining time and financial freedom through opportunities in Real Estate. Today, we've got Brandon Cobb here, and Brandon is the CEO at HB GE Capital. And Brandon has done a lot through his real estate career to build a vertically integrated real estate investment team. So he's done new construction, wholesale, flipping that sort of stuff up to where he's at today. Formerly was a sports medicine medical device sales rep. And then you got your your GC and you are in the Nashville area of Tennessee, and you manage $22 million of new development focusing on single family homes.
Mike Swenson
And we'll talk about that in a little bit as to why you'd like to focus on that. And then active ownership and $33 million in commercial real estate featured in Rei, wealth magazine Realty for one, one magazine, Forbes, as well. So a lot going on. Brandon, thank you so much for coming on the show today. And we're so excited to have you.
Brandon Cobb
I'm excited to be here. It's an honor,
Mike Swenson
Get started by talking about your background. I know people outside of real estate, or even people inside of real estate that just haven't gotten their button gear to invest are always curious to see how do people get started in that. So medical device sales to now where you're at today, just walk us through how that happened?
Brandon Cobb
Yes. So situation where I had my dream job I'd always wanted to do medical device sales new since college that I really enjoyed sells had a background doing door to door sales during the summer, helped pay for college. That's where I sort of cut my teeth. And then one of the combined the degree I was working on kinesiology to help patients out shattered a physical therapist and I was like, Man, I don't like doing paperwork all day. I want to do the fun stuff. I want to like sell these types of things. So spent three years trying to break into the industry finally clawed my way in. And I love what I did. I got to do shoulders and knees of a sports medicine route. So a lot of ACL reconstructive surgeries labrum tears, rotator cuff tears, Allah grafts. I mean, I thought I had the coolest job in the world.
Brandon Cobb
I got a job everyday in scrubs were surgeons. Nothing was better. And I remember coming to meet my boss at a Starbucks one Friday in June, and was actually pretty excited because the case I just had with the surgeon had gone pretty well. This hospital is doing a power trial, we might be selling him some power equipment actually got in the room and could potentially sell him some sports medicine stuff from one of our competitors. I mean, all the things were going right. And he fired me. Huh, came out of left field, I had no clue it was coming and was pretty dumb shocked by it because I'd never been fired before. I didn't really know how to take it. And I've left that meeting just in complete shock because I felt like I had done something wrong. But I didn't know that I'd done something wrong. It was just felt like I couldn't control anything.
Brandon Cobb
And that was the day when I learned that nobody was going to look out for my financial well being you can be as loyal as you want to accompany. You can work as many hours as you want climb the corporate ladder, but the end of the day, they've got to do what's best for them. And it's no hard feelings. So that's when I turned my talents towards real estate and a few other failed business ventures real estate was the first one that took off. And yeah, the rest is history.
Mike Swenson
So interesting to hear. Because I know a lot of times people, there's kind of two tracks in real estate one is I like doing what I'm doing. And I'm in real estate as a way to build kind of a secondary source of income. Maybe at some point in time, I want to get into it full time, but at least have that secondary stream of income. And then a lot of people in your shoes where it's like, yeah, I want to be my own boss, call my own shots, do my own thing. And whether it's them choosing or whether the choice was made for them to kind of nudge them into real estate. That's kind of how they get there. So when you first were kind of digging into the real estate side, what did you want to do? Or where did you dip your toes into the water to get started on real estate?
Brandon Cobb
Yeah, so I didn't have a background. I had no clue what I was doing course, I had always been a self help junkie. So I'd read every book out there on the market, right huge library. So I knew Okay, I need to find a mentor. I need to who not how. So I started going to all these real estate meetups and I was trying to find my mentor and I knew that whoever I found I'd have to figure out what they want. How do I add value to them? So I ended up meeting who's now my partner still to this day, seven years later, my mental and we sat down we're the only two that should Hold up at a Starbucks funny got fired from Starbucks and found my my business partner Starbucks. And we didn't even talk about real estate the first 30 minutes. He was from Colorado Springs, I had just come back there from a sibling trip that I'd done with my brother and sisters, we talked about that.
Brandon Cobb
And I told him what I was trying to do. And he's like, Well, you know, I've, you know, I've got a pretty big portfolio in Colorado Springs wanted to come out and look at it. And I said, Oh, you know, that'd be kind of cool. What are you trying to do here? And he said, Well, I'm trying to get a house looking wholesaling operation up here, my, my girlfriend lives down here, you know, we went to school together had to move because the military and I'm really wanting to get Nashville up and run and I said, well, well, what do you need help with? And he said, you know, right now it's just deal flow. And I said, Okay, so if I can find deals, or if someone found you deals, you would, you'd know how to handle it from there on out. And he said, Yeah, oh, yeah, absolutely. It's just a time thing, because I live in the springs.
Brandon Cobb
And I said, Okay, well, what do you think I should do? And so we hopped in the car, and he showed me how to do driving for dollars, I'd read about this. And I was like, Okay, well, this is this is pretty easy. Alright, let's see about getting this up and running. And over the next six weeks, I spent about four to five hours a day in a car, and I just drove around neighborhoods and put addresses into an app. And we just started mailing those addresses, we had a very niche list. We're very laser focused. And that's how we got started. And when the profits started to roll in, you know, we weren't doing a ton of deals we did, I think maybe nine deals the first year. But we literally took all the profits and just dumped it back into the business in the form of masterminds, mentorship, coaching, marketing.
Brandon Cobb
And I like to joke that there's a scene in Batman where the the Joker slides down the pile of money, and then pours gasoline on it and lights it on fire. I mean, that's what we were doing with marketing dollars. And that's how we were able to grow so quickly was all the reinvestment not only back into the business, but back into ourselves as well.
Mike Swenson
So then you you got into wholesaling. So then where did the construction piece come along? Because I know that you've done some construction as well. So thinking about people that are like, how does this even happen? A guy who's done medical device sales. Now you're in real estate, you have a mentor? How do you get into construction? Because you haven't had construction experience as well? How does How did that happen for you?
Brandon Cobb
Well, I appreciate a good challenge. And while I wouldn't advise people to do what I did, I'll tell you what I did. And I'll tell you why it did end up paying out longterm. First deal we ever did was a house flip, I was driving about an hour and 10 minutes every single day to go and flip that house. Now luckily, we bought it right, right. All the mistakes you can make on a project can all be corrected, as long as you just buy it right, we made plenty of mistakes. But the margins were so good. And we bought it right, that we didn't have to worry about those issues. Second, third deal we did were wholesale deals. Fourth deal we did was a new construction deal.
Brandon Cobb
And this is where I would say don't do what I did. I was not a builder, I did not have a background building. And we hired this builder. And lo and behold, after the project gets framed up, I mean, he basically just walked off. And it was up to me to finish up this this project. And you know, we had some money, I had a little bit of a nest egg sort of saved up, I said, you know, let's tackle it. And you know, Fast forward four months. I'm broke, because I've sunk all my money into this new construction project. I'm trying to answer all the phones, because all these leads are calling from the marketing. I'm trying to manage, you know, to other flips that we have going on. And I'm trying to go on all the appointments that I'm supposed to be making.
Brandon Cobb
It was at that point where I learned how, you know, 26 27 year old, young, single motivated guy, how hard he could work because I hit the wall. I was working every single day. And I was motivated. But man, I had to make a decision to see what part of the business needed to bleed. And so we had to take a tactical pause for a few months and not do any marketing and not answer any calls and not not going any appointments and finish this house so I could get my money out of it. That's I learned from the school of hard knocks, I guess is what I'm saying. It was a great experience, I would definitely not advise somebody to do what I did. It all worked out great. But it was very stressful.
Brandon Cobb
Now that also set the way for future successes. Because all the mistakes that we made, I joke that all the right things I do today are just a matter of all the mistakes that I've made, you can fail so many times that the only decisions left or the right correct decisions. And I feel like that's how we've gotten it. So that's how we sort of cut our teeth in the initial stages didn't do a new construction project for years later. But it transitioned into it when we accidentally stumbled upon some fire damaged and some tornado damage properties that we were able to buy. Buy it for less than what the land was worth. And we said Well, hell, you know, the foundation's good, you know, half the framing is good. Let's just cut out all the black stuff hire a structural engineer Eric, get the city out here, make sure it's all safe, frame it up and just rebuild on it.
Brandon Cobb
And, and that's how we started doing new construction projects, the light bulb went off when we had a home that we're rehabbing next to a home that we were building. And I remember the day where we were like, we sold the house that we built. And we're still rehabbing the other one, I go, how in the world, we built this house in six months and sold, it was like five or six months. And we're still rehabbing this one run month. Number six, what in the world are we doing here? And we looked at the profit margins on the new construction, they were like four times as much. I mean, they were like, you know, 25% profit margins on the, the the revenue of what the home would sell for. I mean, we really liked that. And it was at that point where we decided, hey, we we really needed to pivot.
Mike Swenson
So then you you pivot to focusing on new construction now. So where were finding the land, what areas are you targeting? Because you're in the Nashville area? So what is it that's running through your head when you're figuring out where do we want to do these developments?
Brandon Cobb
Yeah, that's a great question. So we kept the marketing team in place in the sales team that we had built up, right, we, we had felt the squeeze, though, we knew that it was taking a lot more incoming phone calls to generate an appointment, and it was taking a lot more appointments to generate a deal. I mean, you know, we went from like, six, seven appointments to you know, 1314, and we went from 25, phone calls to 40. So we had everything measured. And luckily, we had to had those dials in place so that we could see. So when we transitioned over to doing just new construction, it was kind of the same same game, but a little bit different. We were doing a lot of infill, it was fantastic. It was great.
Brandon Cobb
But we were chasing a lot of these onesie twosie deals, and we'd been stuck at doing, you know, 4050 transactions a year. And we're like, how do we break through this threshold and this, you know, hyper competitive market. And it was at that point, when we realized that we needed to do more deals in the same area of being so spread out with the onesie twosie, infill deals all over the place was just not going to work. And so we decided that we were going to start doing land development, building multiple homes in the same area so that the PMs could just show up to one location, as opposed to, you know, 20 different ones all over the place. And we said, Okay, well, we've got to get we've got to find these really good deals. How do we do that? So what we did was we said, what's the vision of these suburbs that we want to develop? Right? What are they trying to achieve?
Brandon Cobb
So we actually went and we met with the planning commission, we'd meet with the mayor, sometimes we'd meet with the, you know, the building inspectors, and we asked him, we said, hey, tell us the vision for the city? Where are y'all wanting to see growth? Where are y'all not wanting to see growth? Where do y'all want to see apartments? Where do y'all want to see more single family homes, and no one had ever done this with them before. And they were kind of like dumbfounded. They're like, this is one, this is very respectable, that you guys are doing this. Because most developers are bringing something and try to shove it, you know, down their throat, right? And so combative, a lot of times you're combative versus actually being aligned. Yeah. So once we had that, we literally took a map and said, Show me the areas like, let's circle them.
Brandon Cobb
And so now we had these very, very laser focused sales efforts to get in touch with these owners in these very specific areas. And we could rezone their land and pay them way more than what their home was currently worth sitting on, you know, 2030 acres. So it was a win win for the city, because they were getting what they wanted. Yeah, it's a win win for us because we're cultivating a relationship and knew exactly where to focus our time and efforts. And it was a huge win for the homeowners, because we were putting a lot more money in their pocket. And that's how we got started doing land development.
Mike Swenson
Now, how did you cuz ultimately, with with hBg capital, you're, you're raising money. So how did you finance that piece?
Brandon Cobb
Yeah, so like everybody else, when we were doing infill, it'll suck up all your money. And that's exactly what had happened, we had basically just sucked up all of our money. And so the growth was very stagnant. And so we've always used our own money, and we continue to invest our own cap, one in projects to these days, right along with our investors. But after we had done, you know, 155 transactions, and we're out of our own funds and going, you know, it's gonna take another seven, eight months to get our money out of this. And then we've got to grow and scale and we got to pay the operations. How can we circumvent this? How can we grow quicker? And through a lot of the relationships that I had in the masterminds in the coaching? I know that people were using others people's money in order to do these deals.
Brandon Cobb
And so I will was like, Okay, well let me talk to some investors. And up into that point, kind of in my spare time, I'd raised about four $4 million or so right? You know, we needed some construction money like $300,000 to go and build a home, I'd go raise the money. So I started talking to investors getting my name out there, people knew who we were because of our wholesale list. And people were very, very excited to give us money. Because they'd seen a lot of what we're doing on social media, and seen a lot of what we're doing through our email blasts, when send out properties and give updates. And that's when things took off. When we were able to supplement our powder with investor capital and pull our money out and use our money for scaling the business making the right hires covering budget overages, that's when things really took off.
Mike Swenson
Yeah, I mean, one, one thing that's always stuck with me is, you know, I had somebody that had told me, you know, once you master the money game of investing in real estate, then essentially, like you can go do what you want to do. But it takes time, because you have to build up a reputation, you have to do right by the investors that you've worked with previously. But once you have that good story to share, and you have that experience behind you, now you can go in and you have the relationships and the trust built up now you can go find that money. And I think that's a challenge for for people starting out is they don't know how to go find money. And it takes time. And it takes relationships and it takes doing right by the relationships that you have. But then once you you get that like you said it's a it's a powder keg, now you can go build on those relationships in that past experience that you have,
Brandon Cobb
oh, yeah, we could do a whole three, four episodes on just raising capital, there's so much that goes into it. But think of it like a flywheel where, you know, we had some investors that only started off with, you know, 50 to 100 grand. And you know, now they've got multiple, seven figures with us, you'd be very surprised, you know, who has money. And it just seems like every time that we return their money to him with the returns, that they end up investing even more or telling their friends and family or whoever to come.
Brandon Cobb
So it your relationships are going to be key one thing that we use, because we realized this early on that a lot of the capital that we raised a good portion of it comes from existing investor bases, just investing more, once they've seen a few turns, we create an investor experience roadmap. So every step that somebody takes, is completely planned out with us. And our whole goal is to take them from knowing nothing about real estate and what we do and make them an expert on how their money is going to create generational wealth for them, and they can build their legacy.
Mike Swenson
Yeah, going back to what you were saying about people doing a couple of deals and get a couple turns on it. That's that's always also been our mindset is if we help you invest your money and make money, then you're gonna want to invest more money back with us. And so I think that's, that's the natural lifecycle to have the investors is Yeah, once they do more deals, now they've got more to invest. And that kind of hockey stick growth continues to happen. So so there's a few other things that I want to talk about. So one is kind of the commercial piece. The other thing I want to talk about is, is in terms of building and growing your team, let's touch on the commercial side. How did that come to be for you? And where did it grow from the new construction?
Brandon Cobb
Yeah, so we knew that we wanted to diversify, right, and when you're selling a lot of homes, you have a tax problem. And so our goal was to diversify into commercial and multifamily so that we could get the depreciation and our investors could get the depreciation and offset their income. So just like everything else, I started with my own money, I started investing in other people's deals, I understood how the syndications work you know, we were doing syndications as well with our own, you know, neighborhoods and development so I knew what to look for. I knew how to vendor sponsors and operators because I was an operator, you know, I was a sponsor, and I kind of got the hang of how this work I learned how to analyze you know, deals and markets and make sure that it was good.
Brandon Cobb
And we had a deal come across from an old old friend and acquaintance from an old mastermind he had a an apartment complex in Daytona Beach, Florida. And it was a really, really good deal. I mean, it man it checked all the boxes, you know, it was Class B was very heavy value add it was in a great growing area. It was in Florida. So everything from the top down to the bottom demographics were perfect for what we're looking for. And so I felt very comfortable bringing our investors into that deal. And that's how I got started. So I chose to partner with an operator who had, you know, over five exits, demonstrated track record, he'd raised about $50 million, had a great reputation. I knew his integrity was good because I've known him for about five years. And once those boxes were checked, I felt comfortable bringing other people on board and that's how We got into commercial and multifamily.
Mike Swenson
Awesome. So where are you investing now? Or what? What types of investments are you looking for in the commercial space?
Brandon Cobb
You know, in commercial, if it's local, I'd love local but if it's not, we're we're okay with that I like multifamily in Phoenix, Arizona, it's one of the best markets for rent growth. I love Florida, Florida is kind of hard to go wrong with we really like areas where it's business friendly. The past two years, there has been a new development, people are realizing that there are business friendly states, there are non business friendly states. And so there's an exodus and going on right now. And people want to move the States COVID I think just lit the fire underneath. You know, there's, there's, you know, Tennessee, Florida, we didn't shut everything down there and COVID, right, we kept everything open. I like that you want to be a business owner and that kind of economy. So we look for that. Also, no income taxes, Tennessee, Florida, we really like that as well.
Brandon Cobb
There's so many people moving from New York and California, the states that are just taxing businesses to death. If you move businesses to an area, you can bet that that area is going to experience significant growth, significant population growth, and it's going to be very healthy economy. So we're focused on that we're focused on asset classes that provide insulation against market volatility. In other words, bring on the recession, we're not scared of it. Right. This is one of the big reasons while we're focusing on first time homebuyer home. So I don't use the word affordable housing, because it's not section eight or government housing, but I'm talking about that entry level home that there's no supply, and huge demand for we really liked that asset class. That's mostly what we're doing here in Tennessee, with our operations. We really like storage units, we really like assisted living facilities, mobile home parks, we'll look at that as well. Anything that we feel like provides multiple layers of insulation in the event of an economic contraction.
Mike Swenson
So you'd mentioned about having your your investor experience roadmap for somebody that's interested in investing with you, how does that relationship start? And kind of how does it grow and develop along the roadmap? And obviously, you've touched on a lot of the key things that you guys are focusing on. But for somebody that is an accredited investor, maybe doesn't have experience working in real estate and wants to get into it? How does that process work with you?
Brandon Cobb
Yeah, great question. So a lot of people see us on podcasts, social media, you know, our email chains, word of mouth, friends and family, Google. And usually, once they touch us on one of those platforms, they're usually go to our website. And our whole goal on our website is to provide as much value as possible I had, I had an investor one time call me. And I was like, super depressed after the call, he had literally just lost all of his investment to a real estate developer. I mean, the paperwork was done wrong. There was no securitization to the property. I mean, it was a complete disaster. And he was trying to figure out what he could do. And I was like, you know, who knows where the money is now? Because it sounds like he did not use that money to actually execute on the project. And I was like, How do I prevent this from happening to somebody else?
Brandon Cobb
And so I put together a book, and it's on our websites under the Educational Resources tab. And it's called 100 Questions passive investors should be asking before investing. And the whole point of that book was to give somebody who's new and green tools, they need to make sure that they're making a good investment. Because that's what you have going against you when you're new. You don't know what you don't know. And having the right questions, being armed with the right questions to ask a sponsor and operator before you invest, makes a world of difference. So that's on our website, you can grab it, it's hBg, capital dotnet, it's Harry Barbieri, capital dotnet, it's completely free. So usually people will go and they'll they'll just dive into a lot of our educational content and they'll get to know us, our YouTube channels on there.
Brandon Cobb
They'll go watch some YouTube videos, our podcast is on there recession resistant real estate, they'll go listen to some episodes, because they're just getting to know us. Right? And they're we're just wanting to educate them. Because that's the biggest hurdle somebody has when it comes to investing is they're not going to invest in something that they don't know or something they don't understand or somebody that they don't like and trust. Some people sign up for our ebook, recession resistant passive income. If you do that, you get a series of like six emails, those six emails have information that our investor base thought was most valuable to them. So you know how to use your retirement accounts to invest in real estate, how to set up a self directed IRA. You know, what is depreciation?
Brandon Cobb
How can you use depreciation to offset your income and pay less in taxes, all these things go into it. And then at that point, once they feel like we've done enough value add to them, then they'll usually set up an appointment, which they can do on our website. They set it up through Calendly. We give them some past deals to review. So it's not you know, Wondering what you're walking into right off the bat in the email you, you get some past deals that we've done, familiarize yourself with. And we just do an intro call that's just designed to get to know him. There's no hard sales pitch, we just want to genuinely get to know what their needs are, what does the long term view look like? What are the biggest obstacles that are getting in their way and how we can help.
Brandon Cobb
And, you know, after that phone call, they can, you know, we usually follow up a couple times, we send them some some stuff and see if that's a fit. And if they say it's a fit, then we'll hop on another call, we'll walk through next steps. And then we can start sending them opportunities.
Mike Swenson
That's awesome. It's, you know, there's so much that goes into this. And I touched on this before about building, you know, building a good team of people, because even from the early days, you talked about, you know, sales and marketing, building your website, creating great relationships with people. So talk a little bit about leveraging yourself and growing your company through others, hiring Rockstar people, what what are some of the principles that you've lived by? What are some of the stories of success that you've had in doing that? succeeding with others?
Brandon Cobb
Yeah, so I feel like this is something that we do well, I feel like we've currently got a team full of rockstars. And we're growing and we're all rowing in the right direction. And we've got a whole process. And I'll walk through this, and I'll try to touch on it. So it's not all hunky drawn out. But I want to give people some actionable advice they can take for hiring people. So the first thing we do we hire for core values and skills, and we hire for core values first, because it might be possible to teach them the skills were a big traction us fan, I can touch base on that in a second. But we use wise hire, I really like wise Herrick, because they go out and they post rad on all different platforms for you. And they have a nice funnel system that makes everything neat and organized. But I'll go in and after we select the candidates, to have a phone conversation, my phone conversation goes something like this. You know, I'm so excited. You're here.
Brandon Cobb
You made it this far. You know, I've got a handful of questions for you. There's no right or wrong answers. I just want to get to know you. You know, first question. You know, I know you made it this far, what stood out most about the opportunity in the company to really all I'm looking forward to did they do any kind of homework or preparation? Because if they didn't do kind of preparation, they're out. So they don't answer that question. Right? It's basically out next I'll ask why they're getting a new job. They get fired and they hate the past employer. I'm looking for some some negativity there, right? Nobody. Negativity is a lot. It's only positivity. Next, I'll ask them, What do you want to get out of this position that you're not currently getting out of your current or previous position? And they're I'm just looking for what are they? What do they want specifically? Are they just looking for something new? Or do they have some very specific needs in mind that I can hit on?
Brandon Cobb
The next question was, what do you want to get out as long term? So I want to make sure that we're hiring people that there's future growth opportunities. And then lastly, I'll ask what are your income requirements, because you want to make sure that's a fit for you spend all this time and effort doing the next steps? If they pass that, then they get a video, email. And in the video, email has several questions that they need to answer. And we ask these questions because we're screening for core values. So one of our core values in the organization is growth. So how do you screen for that one of the questions that we ask in the email is, I Oh, and by the way, we want them to record all the, the answers, because one of the other reasons why we send this video and ask them to record the answer to all their questions is, I want to see if this is a cultural fit. And if I like this person, right, so before I spent an hour and a half, in person, meeting with him at the office, I want to make sure there's a there's cultural fit right there.
Brandon Cobb
So I'll ask them, tell me about the past three to five books or podcasts that you've listened to? What did you learn from somebody who has that growth? core value is somebody who's going to be reading books and podcasts and trying to better themselves? They want to learn? So if they can't answer that question already know, immediately it's out if they can't remember the past three or five. I know they haven't been doing it. So we'll ask questions around those core values. Now, if they pass that, then we set up what we call a behavioral style interview process. And this is I know, they've got the core values at this point. This interviews used to confirm those core values. And now we want to figure out, do they have this skill set? So the difference between behavioral style interviewing and regular style interviewing and regular style interviewing, you're asking questions that they can have candid responses for. So what's your greatest strength? What's your greatest lead, you know, blah, blah, blah, blah, blah, but doesn't do
Mike Swenson
too much. I work too hard.
Brandon Cobb
Yeah. Same thing over and over and over again, right? I'm a perfectionist, blah, blah, blah. We ask them to tell us stories about times that they've exemplified a skill. So that's behavioral style interviewing. So our whole interview process is stories, which one it makes it fun and to you can't really be as a store if you can't, it's really tough. So if we're hiring for superintendent role, and I need to know if they've got the skills and expertise to manage and fire calm contractors, I would say, Tell me about a time where you're required to fire contractor How did you make that decision? What was the trigger point? How did you go about finding somebody new? Or I'll ask them? What steps do you take to win the contract your your subs respect before asking them to do things. So these are questions that I'm asking, I want to hear stories of Tom's and they've done these things, because you can't really be as a story.
Brandon Cobb
So after they, we know that they've got the skill set, they've got the core values, now we've got a pretty darn good idea whether or not you know, we want to hire this person. And so what we'll actually do is we'll do a ride along with them, you know, for a couple hours if they can get away, and we'll actually, you know, let's say it's the same position. So superintendent position, will take them to some of the projects. And we purposely pick out projects where there might be something wrong, or you know, like, it's just some kind of small issue, and we're walking them through it. And we want to see if they can pick out the mistakes, or what they would do differently. We want to ask them, okay, so what's the next stage here? You know, if you were to take over this project, right now, what next steps would you take to get it back on track, and I want to see if they know what they're talking about.
Brandon Cobb
Because if someone has the skills and expertise to do that, you're gonna know because they're right there, and they're on the spot, and you just throw him in that situation, they can't record that. The most important thing that we're doing during this last part is we're looking for a strategic partner, not an employee. So nobody works for me, everybody works with me, this is a team effort. And if you want to grow a hyperfast organization, you have to hire strategic partners, the difference is an employee will fit right nice and neat into that role. And they'll create a well oiled machine, and they'll kind of keep that leg going, a strategic partner will come in and advise you what you're doing wrong, where the gaps are, where are the inefficiencies, our strategic partners, grow that department and take it to the next level.
Brandon Cobb
So I only hire people who are smarter than me in this specific field that we're hiring for, and can actually blow it up and advise us. So if this person can't come into the position, and almost teach us how to do it better, we don't hire that person. So if we get that feeling, the very last thing that we do, is we do a mock work day where we say, Hey, we're gonna pay you for a full day to come to work. And I'll give them some tasks to do. And I'll say, I want you to call me at 9am 11am 1pm. And then 5pm. And I want you to give me an update, because I want to see how well they are, you know, taking orders and following up at specific time periods. And if that goes really well, and we've confirmed the culture fit, we've paid him for that day and went really well. And my team is on board, because team members will also interviewing will will kind of let them interview throughout the process that they're going to be working with this person than we usually pull the trigger on him that mock work day is so so so important. And that's basically our whole hiring process boiled down and nutshell.
Mike Swenson
There's, there's so much nuance and wisdom there for somebody that's hired a lot of people, I wish we could just spend a full episode talking about that process. Because little things like, you know, giving them homework through the process, you know, I talk with people about, you want to have a smooth process, but you don't want to make it so smooth, that the person is just hiring or you know, blasting resumes to lots of different places, like you said, you want to ask them questions. What research did you do about the company or, you know, try to figure out what research you've done about the company because you want them to want this job, not a job. And so you know, the stuff that you're talking about is the things that I like to do as well.
Mike Swenson
Being able to ask them open ended questions, because there's so many questions that I asked that sometimes I wonder why, you know, the to the candidate, like why is this person asking me this question, but it's all the all the other stuff that you're trying to figure out all the, like you said, you know, you've got your core values, you're asking these questions to figure out the core values. And it's the questions where they don't have those canned answers. And so you want to take them off guard a little bit, but you want to find out more about who they are. And then being able to see them on site, you know, to be able to experience because there's so many times we hire people, and the first day they show up and you're like, oh, this person performs different or they're different on the job, and you're getting a chance to see them in action.
Mike Swenson
So there's so much nuance there that I just love what you're doing. And it's no no doubt why you're building a good organization because you're taking time to find the right people and even like you said, strategic partners, versus just employees. There's so much nuance there and what you've done. Congratulations for for your process, because you do it much differently than a lot of other people do.
Brandon Cobb
Well, thanks. I'm blessed to have a good team. And yeah, I'm sure we could do a whole episode on capital raising systems and process and a whole 40 minute episode on hiring and firing.
Mike Swenson
For folks that want to learn more about you HBG Capital, how can folks find out more about you?
Brandon Cobb
Sure. So if you're interested in learning more about capital preservation, you know, building generational wealth if you're interested in building a legacy and impacting those around you through passive income from your investments, I'd encourage you to go to our website hbgcapital.net, Harry Bob Gary Capital dotnet. I joke that the.com was not available. So we're stuck with the dotnet. But we've got a ton of free educational resources on there, grab the book, 100 questions investors should be asking before investing so you don't make a mistake like are like the guy who called me and had lost all of his money.
Brandon Cobb
You know, if you're interested in our niche investing strategy, free ebook, recession, resistant passive income goes into what we're doing, and you know, the structure and the ins and outs. And then if you're interested in just getting to know us, we've got a Calendly link right on our website, you can schedule a call, usually 2030 minutes, we just look forward to getting to know you. Or you can just ask me whatever questions you want. We look forward to getting to know you.
Mike Swenson
Awesome. Well, thank you so much. I just appreciate you taking the time to comment on and it's no surprise that you're, you're successful in what you do. Because you take time you hire great people, you're putting good systems and processes in place. And what does the future look? Where do you guys want to continue to grow moving forward?
Brandon Cobb
Yeah, so we see a huge opportunity in Nashville in the surrounding areas for first time homebuyer homes. It's a great market, there's so many levels of insulation that Nashville offers that we see a long term opportunity here. So we want to get up to about 300 homes a year and then starting to build apartments and commercial multifamily. We bought it, but we know what our construction cost is right now. And the cost to replace is so much lower than what you can buy you can build a new apartment complex for less than what you can buy it for now. That's crazy, y'all. So that's what we want to get into.
Mike Swenson
Awesome. Well, thank you so much for coming on and sharing in the time that we had invested luck to you in the future.
Brandon Cobb
Thanks. It was an honor. Appreciate you having me on
