Paul Moore: I’m smoking John.

John Dumas: Yes! Paul has an MBA and was a two-time finalist for Michigan entrepreneur of the year. He’s flipped 80 properties, appeared on HGTV, developed a waterfront subdivision, a Hyatt Hotel, and a multi-family fund. He’s the author of The Perfect Investment: Create Enduring Wealth from the Historic Shift to Multifamily Housing.

Paul, take a minute, fill in some gaps from that intro and give us just a little glimpse of your personal life.

Paul Moore: All right John. Well, thanks. I am married for almost 30 years. I’ve got four kids ranging from 23 years old down to 11. Grew up in Ohio, lived in Detroit, Michigan for a while where I worked at Ford Motor Company, and I currently live near the Blue Ridge Mountains of southwestern Virginia. I got an engineering degree and MBA like you said and I’ve been a serial entrepreneur for about 25 years now.

With over a dozen start-ups, including a ground up multifamily facility, a Hyatt Hotel, a wireless internet company, and an online real estate marketing portal. And, I’m actually the author of two books, you mentioned one of them. I’m also the co-founder of a company called Wellings Capital. We’re a multifamily investment firm, and I cohost a wealth-building podcast, oddly enough called How to Lose Money.

John Dumas: Love that title. It definitely raises the eyebrows which is very important in today’s age. And, Paul, with all of that going on, what would you say in just a couple sentences is your one area of expertise if I had to hold your feet to the fire?

Paul Moore: Well, I spent a lot of years up and down in my entrepreneurial journey, and I’ve come to the place where my expertise now is pooling funds from dozens or even hundreds of investors to purchase and operate large-scale multifamily properties.

John Dumas: Okay, so within that, what’s something that we, as entrepreneurs, probably don’t know that we should know, especially if we’re going to be getting into something like that?

Paul Moore: Well, I am all for taking risks as an entrepreneur. I’ve taken a lot of risks, I still do, but what I recommend to young entrepreneurs now is “Don’t swing for the fences with all your investment capital and certainly not with others.” It may work, but it’s not sustainable for most people over a long period of time.

John, there’s a difference between investing and speculating. Investing is when your principal is safe, and there’s a chance for a profit. But, when your principal is at risk, and there’s still a chance for a profit, that’s called speculating. And, I actually confused the two for years, and it costs me dearly and I would never want to do that again with all my investment capital at least and certainly now with any of my investor capital.

John Dumas: Well, the phrase that I like Fire Nation is “You can’t lose it all if you don’t bet it all.” So, just keep that in mind. And, Paul, with all of this ups and downs that you’ve experienced throughout your life, what would you consider your worst entrepreneurial moments to date? Take us to that moment. Tell us that story.

Paul Moore: Well, when I left Ford in the early ‘90s, we started an HR consulting firm, and after about five years, like you said, I was a finalist for Entrepreneur of The Year a few times. And, we sold that company for $2.9 million, and it was a great chance for us to escape to the Blue Ridge Mountains of Virginia, which we did about 19 years ago.

We bought 120 acres on top of a beautiful mountain. We had a pond, stocked pond, trails, and we started a nonprofit organization to connect with international students who were studying in the U.S. and had never set foot in an American’s home. We basically gave them a chance to walk on the trails, and fish, and milk a cow, and ride or goat, or sometimes vice versa. And, basically stay in an American’s home.

Now, semi-retirement at age 35 sounds like a lot of fun, but actually, I was a high-energy entrepreneur, and I just couldn’t do this for long. So, my friend and I started flipping homes and the first home we flipped; we were able to sell as a “For Sale by Owner” in about four hours for about a $24,000 profit. So, I thought, well, this is really easy, we can do this several times a month.

So, we began flipping homes, and we flipped about 50 or 60 homes, mostly very successful. We built a few modular homes, stick built homes, I developed an online real estate portal, and everything was going well. But, I wanted more, so I actually began flipping hi-end waterfront lots at a resort area in the Blue Ridge Mountains called Smith Mountain Lake. We bought lots that had been originally purchased for $10,000 or $50,000 in the ‘70s or ‘80s, and we were able to buy them for a few hundred thousand dollars.

Now, these lots were overgrown; you couldn’t see the water, people hadn’t visited their own lot for years. We bought these for cash, we cleared out the underbrush, we thinned the trees, we made it into a park-like setting. We got a dog permit, took beautiful photos, and we advertised it on our website, and we were able to make about a hundred thousand dollar profit on these lots because the real estate market was on fire at the time.

We were able to sell these lots for say, $400,000 up to a $1 million. We started getting investors. We got multiple lots going at once, and it was not only profitable but a lot of fun. Now, John, we should have seen the signs that the real estate market was turning. Fortune Magazine’s headline, their cover story in 2005 was “The Real Estate Bubble is About to Burst.” But, you know there’s a song called The Boxer by Simon & Garfunkel it says, “A man hears what he wants to hear and disregards the rest.”

Paul Moore: That’s right. And we should have listened, but the siren song of the real estate guru’s and our growing bank accounts caused us to ignore this. So, we continued to buy these lots at so-called “deep discounts.” We should have noticed when the web inquires slowed down, and the phone calls slowed down, but well, when the real estate market screeched to a halt, the resort market screeched even harder.

And we had a whole bunch of lots on our hand. I had a waterfront vacation home. I found myself going from a couple million dollars in the bank years earlier to $2.5 million in debt, and this was late 2007. And John, that’s when my partner bailed. He said he couldn’t handle the interest payments anymore, which left me with double the interest payments and I had a real estate income from my real estate marketing portal that was drying up at the same time.

I found myself in a really difficult place and oddly enough, I don’t recall ever losing any sleep over this. I believed it really would work out and this is what eventually led to my “Aha! moment.”

John Dumas: Whoa. I love that little cliffhanger there. And I do kind of want shoot back to the beginning part of this story that you told because Fire Nation believe us, believe Paul, believe me. Early retirement, although it sounds amazing, it really isn’t. And I can actually also speak from experience because I got out of the Army at 26 years old. No debt, six figures of savings in the bank. I was like, I’m not going to retire but I’m just going to chill out for a while, and travel and just do nothing. But, man, you lose relevancy in life really fast. You’re just like, “Wow, do I even matter?”

I remember going to the supermarket and walking around and just being like “Nobody cares if I’m here or not here.” It’s kinds of this weird psychological thing with humans, we want to be relevant, we want to be making progress in life, and so that’s why retirement is never really what it seems to be shaped up to be when we sort of paint it in this great picture.

So, Fire Nation, that’s why we have shown like this; so we can say, “Hey. Maybe you don’t want to retire; maybe you’re just working the wrong job.” If you can find something that you’re enjoying, that you love, that you have a passion for, then you are on the right path. And maybe one of these stories is going to spark that idea. And, Paul, before you get to that “Aha! Moment” that you’re talking about let’s just give Fire Nation one lesson learned in just a sentence or two, that you want to make sure we pull out of your “worse moment” story.

Paul Moore: Simon & Garfunkel “A man hears what he wants to hear and disregards the rest.” It is so easy to ignore ‒ just to shape the so-called facts to fit whatever you really want to do, whatever you really want to believe. And it is so important as you mature, as we mature as entrepreneurs, to fight that tendency. And one way to do that is to get people around you who have no dog in the fight to give you objective analysis and objective advice and really listen to them.

And one person that can often do that for me is my wife. Sometimes she knows nothing at all about the situation, but she has an intuition, a gut feel if you will, that I’ve painfully, much to my shame, ignored many times, and usually, I’m wrong when I ignore her and when I ignore the counsel of my friends.

John Dumas: You teased us with the “Aha! Moment” story. Let’s go there Paul, take us there.

Paul Moore: Well, it was late 2007; I found myself $2.5 million in debt and feeling pretty desperate. So, one morning I was up early as I always am and I was actually spending some time in prayer and meditation. And the thought hit me, WWGMD, “What would George Müller do?” George Müller was a guy who lived throughout the 1800s in Bristol, England, and he was actually a hellion. But, he was hellion turned saint. And he had rescued and housed thousands of orphans off the streets of England over his many decades, and he had a really unique fundraising technique.

He actually never told anyone what he needed. He had a very meticulous budget, and he kept very meticulous records of every cent that came in, but he never told anyone, not even his own staff what his needs were. And he basically just prayed and he trusted God, and he just did the right thing, and he worked hard, and he expected that all his needs would be met. Amazingly, he raised something like $200 million in today’s dollars over about 70 years of just doing this and never asking for a dime from anybody.

Now, his needs were always met, and the orphanage’s needs were always met, but it left some very tense and unusual situations. Like the time the orphans all recall sitting around for breakfast in the banquet hall with ‒ they were all dressed for breakfast, but there was no milk and no food at all. And they prayed to receive their breakfast but still no breakfast, and then a knock came at the door, and there was a bread truck, broken down outside. And the guy delivered all the bread that they needed to eat.

And then a milk truck stopped by and gave them all the milk they needed, and they had their breakfast. And this happened again and again. So, I’m sitting there that morning wondering, “Wait a minute. What would George Müller do? How does this apply to me?” Well, first of all, he wouldn’t be deeply in debt, but I figured if he was, he would generously give his way out of debt. He would do something completely counter-cultural, something that made no sense and somehow mystically it would lead to a path out.

So, that’s what I decided to. I told my friends who thought I needed to declare bankruptcy, I told them, I was going to believe in the universal law of sowing and reaping, some people call it “kFarma.” And I gathered my family around in January 2008, and I said, “We’re going to begin to give to organizations we’re really passionate about.” So, I acted like I had a half million dollars in the bank when really it was just quite the opposite.

Four weeks later, I was in a Subway restaurant at Smith Mountain Lake, and we had given quite a bit of money that month. And, I told a friend who was a real estate developer about the situation, and specifically, I told him about a parcel of land that I could not sub-divide to develop at the lake. He made what was basically an off-handed comment that set a fire in my brain and gave me a new idea on a different way to subdivide that land. Well, I had to jump through a lot of hoops with bankers and with the county. Everything was on the up and up, but one thing led to another, and 13 months later I went from $2.5 million in debt to completely debt free. I even paid off my own house during that 13 months.

Now, I had to work hard. I invested a lot of time, a lot of money, a lot of creative energy. But, John, I’m absolutely convinced that this wouldn’t have happened if I hadn’t started out by generously giving away the money we had.

John Dumas: Love this story, and there’s actually a couple fun facts that I want to share about George that I learned while you were chatting. Number one, he has very impressive eyebrows. Now, all you need to do is Google at Fire Nation; you’ll figure out what I mean. And number two is that he died at the age of 92. So, he lived a very great long life, and he died in the year 1898, which is the same year that my islands of Puerto Rico was absorbed by the USA. So, I kind of feel a connection to him at that.

As he was passing away, Puerto Rico was becoming part of the USA, so a couple of interesting facts about George. And, Paul, what do you want to make sure that our listeners get from that story, from your “Aha! Moment?”

Paul Moore: It’s really easy to think “If I won the lottery” that I would be really, really generous or if I made $10 million and my ship came in I’d begin to give. But I don’t really think that’s true because we are a miniature version today of who we’re going to become in the end. And so, we need to start being generous with our time, our resources, our money, today and that will help us get to the place of abundance.

John Dumas: Wow, love that message, love that story! And, Paul, fast forwarding to today, what are you most fired up about? What is setting you on fire right now?

Paul Moore: Well, I’m guessing most of your listeners are familiar with TOM shoes. If you buy a pair of TOM shoes, you don’t have to share your shoes with a needy person in another country, but you can know that TOM shoes are donating a second pair of shoes to a needy child in a third world country. Now, you don’t get to choose where those shoes go, but you can know that they’re donating those shoes.

My company’s called Wellings Capital, and we allow our investors to have the opportunity to profit from one of the most stable, profitable assets on the planet, which is commercial, multifamily real estate, large apartments. Now, investors like with TOMS shoes, get to keep all their own profits, but investors instruct us on where they’d like us to invest our internal profits to a large extent, to change the world.

If it’s something they're passionate about, and it’s something we agree that we’re passionate about, we’re going to invest a significant portion of our internal profits toward that thing to change the world. And we’re particularly passionate, John, about fighting human trafficking. It’s a global threat to men, women, and children all over the world. It’s an injustice that’s affecting millions on every continent, every year, every socio and economic level.

Believe it or not, human trafficking generates $150 billion a year from 21 million victims. Now, to put that in perspective, that’s double the annual record profits, the record profits of Apple, Nike, Starbucks, and General Motors combined. Ninety-eight percent of the victims are women and children. Wellings Capital is funneling a large portion of our profits to thwart human trafficking and rescue victims, to tell them that their not a piece of garbage, that they’re valuable and precious.

And we’re excited to work with our investors to place our internal profits with organizations doing this important work. We’ve got our favorite organizations, including an organization of ex-military people who are using satellite tracking and going in and rescuing these victims.

But, we want our investors to tell us their favorite organizations. It could be people fighting trafficking, drilling water wells in third world countries, putting orphans in homes, or fighting injustice of all kinds around the globe. We want to fund those type of things with our internal profits.

John Dumas: Fire Nation, I hope you’re as inspired as I am by what Paul’s doing. The mission, the life that he’s leading, and he’s not going to stop here because he’s going to continue dropping value bombs in the lightning round, so don’t you go anywhere because we will be right back. Paul, are you prepared for the “lightning round?”

Paul Moore: I am ready!

John Dumas: What was holding you back from becoming an entrepreneur?

Paul Moore: Well, I was working at Ford Motor Company, and the only thing that was holding me back was the right opportunity. An MBA partner of mine and I were looking at doing an oil change shop in metro Detroit, and then we talked about doing a tax consulting firm. We eventually landed on an HR consulting firm known as a Professional Employer Organization or PEO. My wife was seven months pregnant, and I left the benefits and security of Ford to jump into this, and we actually ran that company for five years, and we sold it to a publically traded firm in 1997.

John Dumas: What is the best advice you’ve ever received?

Paul Moore: Generosity and Benevolence are the past to having more, not less. Hoarding, wealth, and greed are paths to misery and a useless life. A great Proverb says, “One person gives freely yet gains even more. Another withholds unduly but comes to poverty.”

John Dumas: What is a personal habit that contributes to your success?

Paul Moore: John, I am a High-D, Type A personality, so it’s not natural for me to slow down at all. So, my goal is, like I mentioned earlier, most mornings I try to wake up early and spend an hour in silence, prayer, and meditation.

John Dumas: If you could share an Internet resource like Evernote with Fire Nation, what would it be?

Paul Moore: I’ve had a hard time keeping up with my clients, and contacts, appointments, and follow-ups over the years, and last year I discovered HubSpot, which is a comprehensive, online contact management company. I really like their templates, the way they integrate with Google Analytics and websites and all types of social media campaigns. Fire Nation, if you don’t have a contact management system, you really need one.

John Dumas: And I can tell you HubSpot does a great conference every year called Inbound in Boston, so check it out. And Paul, if you could recommend one book to join the perfect investment, your book, on our bookshelves, what would it be and why?

Paul Moore: Well, as a serial entrepreneur, I’ve always struggled to focus on one thing at a time. So, to do that and do it well, I’ve really enjoyed the book The ONE Thing by Gary Keller.

John Dumas: And Jay Papasan, past guest of EOFire, I definitely have to make sure Jay gets his credit due. And Paul, let’s end it today OnFire with a parting piece of guidance. The best way that we can connect with you and then we’ll say goodbye.

Paul Moore: Well, EOFire listeners, the fact that you’re listening to this podcast shows you’re on a path to future wealth and success. But like I said earlier, “Who you are today is a mini version of who you’re becoming and who’ll be in the end.” And money will just magnify your strengths, and your weaknesses so don’t believe the lie that you’re going to be the person you want to be when you get to that point.

It doesn’t work that way. It’s really the reverse. Start giving away your time, your money, your energy, to serve others now. It’s going to come back to you in spades for decades to come. Our listeners can reach us at wellingscapital.com, and we’re offering a special free report covering the nine reasons commercial multifamily investors rarely pay substantial taxes on their very substantial profits. This is one of the most surprisingly happy benefits of what we’re doing, and we’re delighted to share it with your listeners.

You can get that at wellingscapital.com/fire. You can email me at paul@wellingscapital.com, and my book The Perfect Investment is available is available on Amazon, and like I said, we’ve got a wealth building podcast called, “How to Lose Money.”

John Dumas: I love all of this in Fire Nation. You, the average of the five people that you spend the most time with. And, hello, you’ve been hanging out with JLD and PM today, so “Keep the Heat! And, head over to eofire.com, just type “Paul” in the search bar. His show notes page will pop up with everything that we’ve been talking about today. These are the best show notes in the biz. Timestamps, meaning you can click on a link and jump right to that part in the interview. Links galore.

And, of course, check out wellingscapital.com/fire for your free gift. If you have a question about what we’ve talked about or just want to say thank you or “Hi” to Paul, paul@wellingscapital.com. And, of course, snag his book, The Perfect Investment to learn the great ideas that Paul’s experience and is willing to share with you over the years of his journey. And Paul, thank you for sharing your journey with us today. For that, we salute you, and we’ll catch you on the flip side.