Speaker: 00:00:00

when you're buying a franchise, you're buying a brand, but people tend to underestimate

how important that process or SOP is.

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And in a good brand, you're getting a lot of value.

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We are talking to Adam Goldman, and you can find what he can help you with by going to

franchisecoach.net.

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And I'm going to have that as a clickable link in the show notes.

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But we're talking franchises today and how it can maybe complement your real estate

investing.

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Really appreciate your time, Adam.

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Thank you so much, Jack.

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Such a pleasure to be here today.

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Well, I gotta find this out.

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Most of these professions seem to be accidental at best.

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How did you find your way into this?

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It was definitely accidental.

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So I actually was a successful franchisee for eight and a half years.

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I owned an office cleaning master franchise in Houston.

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And what that meant is basically we cleaned office buildings.

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I cleaned toilets for a living and had an unsolicited offer for my business, which I

accepted.

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So I'm a franchising success story in that it was a really lucrative offer, a great offer.

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And I,

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and didn't know what I wanted to do afterwards and kind of stumbled into this business

part-time and then full-time after I sold my company.

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Yeah, that's really interesting.

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You know, it's funny that you bring that up because I've even gotten unsolicited offers.

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And it seems like it's been all of a sudden.

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Like, I don't know if there's a trend of some kind going on.

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There are a lot of people entering my business, right?

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And look, I don't get scared of competition in general, right?

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I mean, what I would say is that I was in an extremely competitive business of office

cleaning in Houston.

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I really truly believe that I'm bringing a really unique perspective to the table.

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Not only have I had this role for eight years plus, I've done about 200 placements in

eight years, right?

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So lots, I've seen it all at brands that are in 75 industries.

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But I really have walked the walk of my candidates, right?

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I myself have been a franchisor, so I know what it's like to sell franchises.

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I've been a franchisee.

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I know what it's like to actually have someone that you're franchisee under.

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So I've gone through this process myself with a coach, and I really can bring that skill

set to my candidates, which really goes ahead.

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I would say it differentiates me.

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Well, it is kind of interesting or dip, was sadly different.

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Where people actually walk the walk.

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I mean, I've run into real estate investors who are doing who are selling coaching and

sometimes they don't actually do the investing themselves.

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They're just kind of regurgitating some some training material.

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And look, forgot to mention the most important thing for you, Jack, which is shocking.

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We'll do a drum roll for this.

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My service is free.

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Meaning it's like, why wouldn't you use my expertise?

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I do get paid from the franchisor if I make a successful match.

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Right.

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Well, what also makes you unique is that you have experience in real estate investing as

well.

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Can you talk a little bit to that?

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Sure, absolutely.

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Absolutely.

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And look, what I would say is this, that when it comes to owning dirt underneath

franchises, every once in a while I have brands like that where there's a real estate

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component as an owner of dirt.

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Much of my recent real estate experience is related to just investing in different deals,

things related to as uh syndicates, things related to hotel debt or other um multifamily

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investments or even mobile home parks.

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as an investor, not as an active, but I actually am active when it comes to single family

residences in Houston.

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After 2008, I found a niche in buying bank owned houses post foreclosure and owner

financing it to people.

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And I have a portfolio in Houston of those properties.

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Yeah, I know a couple people that focus on that.

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And it, it, it's just one of those things that have been a little elusive for me, but it

seems like it's making a lot of sense, especially with, with single family homes.

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mean, they just, depending on the age, just don't cash flow like a traditional rental.

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I've been, I mean, look, I got it at the right time, but just to kind of show some

context, I was able to buy these houses at anywhere average house price was $30,000

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$50,000.

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There was an $8,000 tax credit or $8,000 bonus that the government was giving that could

be used as a down payment.

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And this is the kind of thing, frankly, where people are willing to pay a higher interest

rate just because they don't have the alternatives.

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And they typically don't come in refinance, which has kind of blown me away.

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We're talking about 10 % interest over the course of 15 years plus and selling it at a

premium to 30 to $40,000.

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Going back to you having all of the, you have had a lot of experience, especially you've

built businesses on two continents.

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You scaled multiple companies.

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What's one early lesson you learned the hard way that still influences how you approach

opportunities today.

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That's such a great question.

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think for me, I think people need to understand what their skill set is, right?

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And my skill set has never been uh creating process.

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I'm very good at like, hey, I'm gonna start something.

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If you look at my things related to caliper, I'm the kind of person that can start things

quickly.

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But I'm not great at creating that foundation of a process.

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And um what I've learned is sometimes either I need to associate myself

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with other people that can help me to mold that process.

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have colleagues inside this, in this industry of franchise coaching that kind of give me

best practices of coaching.

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really, and I have a team myself that can kind of help me to implement these processes,

but even more importantly, to kind of create process behind things, which doesn't come

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naturally from.

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Yeah, it's kind of interesting that you bring that up.

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And maybe it's just serendipity.

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it's it's kind of interesting how people will, especially at first, they try to operate

how they think they should instead of how they naturally would.

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Yeah, I mean...

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So what I would say is, way that, so you're mentioning that as opposed to the way that I

would operate or just in general, the way people invest franchises.

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it's one of those things like it kind of takes me to a conversation I had with my wife, we

were taking some personality tests.

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This was many, years ago.

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And I was answering the questions.

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And she called me out on it on a few things, because I was answering the questions on the

way I wish I would be and not the way I actually am.

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And after her sitting there by my side, questioning me on a few things, it was probably

one of the most accurate results I had gotten.

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That's really funny.

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I mean, look, what I can tell you is that in a good franchise system, right, this is the

kind of thing that kind of has these guardrails to allow you to work the way that you

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should be working, right, as opposed to the way that you would otherwise be working.

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That's powerful.

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Yeah.

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Let's tie this to real estate investing a little bit because sometimes I think it's it's a

bit overlooked the concept that there are some franches out there that actually could

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augment or or provide some additional capital or workflows or even leads for investors.

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You mentioned working with single family homes.

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You know, I have a

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I have some friends that started up a carpet cleaning service.

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And not only does that augment their real estate investing, but it has provided a couple

leads because they've had they're dealing with tired landlords and a few other things.

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So it's been properties they end up buying.

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That is a great point.

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A business that really comes to mind for me is property management in general.

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Because typically if you're a property manager or there are property management

franchises, a lot of times your customers are absentee landlords and sometimes they get

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tired or even a situation where my friend in Colorado said, if you want to understand the

local market in Vale or Aspen, see what's going on with the peso.

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I don't know what percent of the properties are owned by Mexican nationals, right?

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But if the PESA is not doing well, watch out because that's a great time to buy.

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People might have to unload property in Vail.

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It's kind of interesting that you said your personality, you just don't like building out

processes.

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S O P's is probably a four letter, letter word in your world.

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absolutely, my gosh, I can't stand it.

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But that's ideal for people that are in a similar situation, right?

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Because that's the whole point of franchising is the big part of it.

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I can really appreciate a great franchise brand and my day to day is getting to know

people, right?

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And almost matchmaking, right?

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It's really intellectually stimulating for me to get to know someone deeply or intimately

and then just going ahead and figuring out, my gosh, this is a great fit because this

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brand has these characteristics from a cultural point of view, whatever that might be.

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That is much better for me than actually sitting behind a desk day to day, not talking to

anyone.

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and writing SOPs, that would be really hard.

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Yeah, even with AI and some of this technology, unless you're willing to sit down and log

those hours, I'm sure it's not it's not an easy thing.

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So on the flip side, you've I just find it really interesting that you were a franchise

owner, and then now you're selling franchisees.

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Yes.

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what what helped you with that jump?

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Is it was it just a natural like this is what I'm going to do?

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Or did you kind of find your way?

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How did you find your way to it?

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Let's just be blunt, I prefer being a franchise coach and consultant to actually running a

franchise business, right?

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I love starting things, it was great, but by year eight, it's like, my gosh, this is like

a complicated business.

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We were cleaning hundreds of office buildings with unique challenges on a regular basis.

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It was harder from an attrition point of view, meaning once you get big, if you lose, it's

harder to keep up, right?

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If you're starting out.

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It doesn't matter because you don't have any customers to lose anymore because you don't

have any customers.

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If you have hundreds of customers, if you lose one, it's harder to make up for that on new

customer acquisition.

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Whereas my current gig that I'm doing, it's just really interesting in that I'm getting to

know people well.

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It's more project based.

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I have relationships after I make the match, but it's really getting to know someone and

then making that match and then kind of, and then still guiding them.

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But once they decide to invest in a franchise, it's...

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It's not as much of a relationship anymore, it's moving on to the next person and helping

them on their journey.

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Well, I'm sure you've seen and you've talked to another a bunch of these entrepreneurs now

that are looking for their path.

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Have you found any kind of consistency there like something, I don't know, some low

hanging fruit, especially when it comes to selecting a franchise that they should tackle?

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So you're talking about when it comes to the right fit for people that are actual

potential franchisees.

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if we look at the average franchisee, it's typically male.

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We have some females, right?

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It might be a husband and wife team.

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And it's typically people that are in their 40s.

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And the kind of overarching theme is someone that is just

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just fed up with corporate America.

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In many ways, it might be a real estate investor, right?

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That has it on the side, it's looking to diversify as well.

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But it's someone that has business skills that wants to go out on their own and sees the

benefit of having training wheels in their entrepreneurial journey.

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Well, I mean, we got to face fact, a lot of businesses starting out without these training

real wheels would have a typical track record of failure.

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I mean, we just have to be blunt about that.

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For franchises have has a better odds of success, right?

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Much better odds.

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Some people say that it's you're 80 % more likely, right?

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I I've heard that it's 90 % chance of success in franchising and only 10 % success rate of

non-franchising.

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Well, could you kind of give us some examples?

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You gave the example of a cleaning crew.

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I gave the example of a carpet cleaner.

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Are there any others, franchises that come to mind right now that would possibly be a good

fit for real estate investors?

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So look, what I would say is this, and I'm not gonna go into specific brands, but if I

think, I have brands that are in 75 industries, and I do matches based on characteristics.

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When people come to me and they're looking for an investment, right, to kind of diversify

their portfolio, the things that I get most excited about are things that are hands-off.

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And some of the businesses that I get most excited about, real estate related, are things

I specifically enjoy.

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It is quite expensive, but I do like the salon suite industry.

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And the reason why is it's the kind of thing where you go ahead and you lease space from

landlords, or you might actually own the dirt underneath.

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One of my friends owns the dirt, and they're able to go ahead and build this.

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And you're able to really rent this out to beauty professionals at a great rate.

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And it's pretty hands off.

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We're talking about no employees and after hours access using the fob key.

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And just to remind everybody, if you found this interesting so far, I'm going to direct

you over to Adam's website, franchisecoach.net.

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to get some more information and connect with him there.

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If you found some value in what we're chatting about so far, this show only grows if you

share it with one of your investor friends.

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So consider doing that.

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If you're watching us on YouTube, feed that algorithm that like and subscribe goes a long

way.

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Could you maybe Adam, could you maybe share a story of somebody who came to you with these

hopes and dreams and you kind of

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they didn't know what direction to go and you matched them up with the perfect franchise

and it turned their life completely around.

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So the one that really sticks, and I'm gonna stick to the uh salon suite industry, I

typically have my happiest franchisees in that industry, is someone that came, it's a

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husband and wife team, he's an IT director for a Fortune 500 company.

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And Jackie, they came to me, they were like, look, you know, I've had these exciting

thoughts of entrepreneurship, but it just never was the right time.

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As a kid, I wanted to start my own business.

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And I'm just busy as a chief technology officer for this company.

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his wife is lovely as well.

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And I showed them three different brands and they decided to invest in a salon suite.

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And it just became just a great scalable business for them.

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They opened multiple units.

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His wife is, they also bought real estate underneath for one of the three locations.

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It's just been a...

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I've actually visited them for a grand opening for one of their launches and they've

become landlords and it's really helped them to kind of, it's changed their life for sure.

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He's planning on potentially retiring from his job and that's really rewarding for me to

see people in which I've made an impact on them.

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I'm looking to change lives.

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You know, you've brought the sweet idea up a couple of times here now.

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Have you run into investors that do like mixed use where they have the commercial or

retail on the bottom floor and then they're supporting the residential units above?

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It almost seems like that would be a great fit for people with those type of investments.

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And they could actually leverage and support those residents and kind of create a

secondary

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cashflow there.

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don't know if I'm...

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have not run into investors, but I know of people that have dirt that say, hey, we even

have a space.

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Like, you know, I'm going to invest in a franchise myself, or this would be a great

opportunity for me to have this.

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Many times, my franchisees are actual tenants in buildings.

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Sure.

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You know, those people that are looking to add this type of thing, what type of questions

should they be asking if they're approaching somebody like you, Adam, just to make sure

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that that's a good fit, that they're finding the right person to help them with their

choosing a franchise?

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So I think the most important question is not related to me, but it's related to

themselves.

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And I think that the one thing that people really need to understand about my industry is

everyone wants a hands-off franchise, right?

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Or 95%.

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They want to put money in and then go to a mailbox, right?

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Kind of like mailbox money and real estate investing and not have to put any work into it.

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these businesses, even on the spectrum where it's a semi-absentee opportunity, you still

need to put time in.

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And if you can't put in five, 10, 15 hours per week, this probably isn't the right

business for you in general.

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Well, 51015 that's actually doesn't sound terrible to me, but I guess maybe I'm not the

average person.

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And look, I think it's a skill set to actually be able to manage people.

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One of my favorite franchisees that I know of here in Houston, he's a pastor and he has

this way with people where just kind of visiting with his team for coffee for 10, 15, 20

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minutes, like a daily huddle, he's able to really get a lot done and that's a skill set.

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But based on your experience, then, what what's been some of the biggest hurdles when

people are trying to scale these these type of

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Great question.

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Scalability differs from a different business model.

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Let's talk about a couple of examples of scaling.

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If you own a fitness studio and you want to and you've tapped out your subscriber base

within a certain radius, Jack, it's really hard to go ahead.

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The way you scale is you have to open up another location.

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What's exciting about non-brick and mortar locations is that

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Scaling might be easier.

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It might be if you have a service company like we've been speaking about before, then you

might just need to buy another truck and then all of sudden you're scaled.

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scaling means something different for different businesses.

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Every business, and you mentioned limitations, I'd say the limitation depends on the

business, right?

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Maybe it's a limitation of equipment or of capital or it be people.

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Have you run into any franchises that that are more remote like or E type stuff, whether

it's it support or that type of thing?

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Or is it primarily like services like the spas and HVAC and plumbing and you know, those

type of things?

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Everyone wants that remote, they want to work from home, right?

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COVID has spoiled us.

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That exists for sure.

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95 % of my franchise placements are territory based.

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I would say that the things that don't necessarily have a territory aspect to them,

they're typically sales related.

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It might be a B2B sales role and that can be very attractive.

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For instance, let's say you have IT skills and you want to be able to sell that throughout

the country, then you could potentially buy a franchise that would allow you to do IT

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services different places.

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But you need to be real sales proficient in selling.

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Sure.

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OK.

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Well, we were talking about these other services, the HVAC.

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Well, I guess I brought up the HVAC and a few other things.

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But outside of the spa, are you seeing anything in particular that's trending right now?

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Or people might be contacting you because they want the next Krispy Kreme.

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Great question.

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At this moment, I'm finding fitness to be very, very popular, specific aspects of fitness.

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And the reason why is when fitness is really good, it can be awesome.

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And what I mean by awesome, I'm talking about Orange Theory in 2012.

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Orange Theory is known as being one of the big success stories of franchising over the

past 15 years or so.

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And what I mean by that is that literally it's a situation where if you build this thing,

if you build the right sort of fitness studio,

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You could actually have enough people in pre-sales to pay for your rent even before you

actually sign your lease or you're actually paying your money.

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I would imagine that oh one of the things that make some of these franchises uh stand out

is the way and how they support the franchisees.

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Like, have you found any in particular that kind of stand out whether it's their

processes, their techniques, their support infrastructure?

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I actually have and I'm glad you mentioned that.

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I'm not gonna talk about specific brands again, but I have a franchise brand.

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have something that's almost like this emergency squad where he spends millions of dollars

every month and even uses his private jet and they literally go to people, franchises that

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need help and they turn it around and I just love that.

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That's a big deal for

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Yeah, like what did they do to help them turn things around, just reinforce the SOPs?

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Yeah, I mean, it's just all the above, not only one person.

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When I had my brand for eight and a half years, I got stuck sometimes.

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mean, there were certain things going on and I really appreciated that support from the

head office.

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And it's all about having the right people in place as well from the French.

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I coach my candidates to be best friends with the support staff at the head office, right?

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So all of the above.

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And to give you some TLC, that's huge, best practices.

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What I'd also say is that people tend to underestimate how important it is to get help

from other franchisees, the kind of brother and sisters in arms.

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There's a lot of value in that as well.

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Do you find that that's like in the real estate world, I've found it abnormally great the

way everybody treats each other, you know, like the other other investors, even in your

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market will go out of their way to give you advice or some direction and help is that

typically the community you find in franchise world to

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Not every franchise, right?

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But in the ones that I connect my investors with, that's one thing I'm looking for, right?

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Some actually have guilds of people in the same market where they negotiate with suppliers

to get a discounted rate.

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That's a huge factor when it comes to that.

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I was very blessed in that the franchisee in Minnesota for my office cleaning master

franchise actually trained my staff just out of kindness and camaraderie.

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Yeah, it just seems to be like we're all in some sort of competition.

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But, you know, I bring this up in the fact, too, I don't know if you've ever played that

board game.

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Robert Kiyosaki had that cash flow board game for a while.

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glad you brought that up because my kids are huge cash flow fanatics at age seven and ten.

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Yeah, it's one of those things that if you're in a competition together, the game lasts a

lot longer compared to if you all decide to cooperate.

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And then everybody becomes wealthier quicker.

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Have you ever tried to play it that way?

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How, refresh my memory how you can play the game and be cooperative with it.

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meaning like you can sell it, sell the different things that people don't, you're right.

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Yeah, so if you're, yeah, it's just a different little mindset change and then the game

becomes different.

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good point.

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So unfortunately at my house, I hate to admit this, we are not, we are very competitive.

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We're not even the game settlers, right?

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Which we love Katam, where we trade the resource.

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Winter's coming.

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We got that we got them stacked up here actually right now.

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We're not collaborative enough in that game either, but we would probably be more

successful if we traded more.

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Right.

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So could you talk a little bit about the trends and like the economy like right now?

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I would imagine you've become fairly popular.

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I don't know if you've been to LinkedIn recently, but there sure seems to be an excess in

number of people that are looking for work.

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And maybe they are now just deciding, you know, I have to create something instead of

looking for something.

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So Jack, that's a great point.

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And look, I think that there's a lag.

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So I liken this to being 2020 all over again.

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No one wanted to talk to me in March of 2020, right?

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It was too new and too raw.

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I think this tariffs is kind of a slow burning type thing with this disruption that we

have.

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But I do think that many more people are gonna wanna talk to me in three months to six

months.

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I'm not seeing a huge uptick in interest.

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Relative, I mean, because there's just so much uncertainty right now.

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I saw a lot of uptick in interest in the last quarter of 2020 and the first quarter of

2021.

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And I feel the same thing's gonna happen here.

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Well, Adam, this has just been such a great conversation before we jump in and start to

close out this episode, should we have hit on anything else?

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Like, did I miss anything?

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No, I think you got everything.

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I appreciate that.

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And the other thing I wanted to mention is that I actually have some franchises.

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It's pretty well known.

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One of the challenges of real estate investing is sometimes it's hard to get deal flow.

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And there actually are franchise brands out there that can give you good deal flow, right?

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Cause it's just not so easy for you to just kind of raise your hand and say, I'm going to

X amount of mailers or.

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to actually have that system or SOP, that's valuable and some franchise brands can do that

very well.

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Yeah, you just kind of created a couple other questions for me here since you mentioned

that.

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You know, one of the things that real estate investors sometimes struggle with is

marketing.

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Is there franchises associated with that?

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Absolutely, yes.

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So specifically real estate marketing.

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I have franchise brands whose sole purpose is to help you to find deals, right?

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They give you the secret sauce and a network of other people.

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Okay.

325

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And then the other one would be the obvious one that I can't believe I didn't think of now

is like home buying type services, uh ugly houses, we buy house type thing.

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about basically, things in that market.

327

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I've even seen in the past commercial real estate buying, right?

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Buying commercial buildings, franchises that focus on that.

329

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Right.

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You know, it's kind of interesting because when we were initially getting into this, you

know, we were researching different coaches.

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And it was the one that provided essentially what we saw as a franchise where we were

getting the SOPs, this is what you do every single day.

332

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That level of guidance is the one we ended up deciding to go with because of that level of

here's the business, do it.

333

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And look, Jack, when you're buying a franchise, you're buying a brand, but people tend to

underestimate how important that process or SOP is.

334

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And in a good brand, you're getting a lot of value.

335

00:27:03,767 --> 00:27:05,829

Well, Adam, this has been a great conversation.

336

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One more time, I'm going to remind everybody, check out the franchise coach.net going to

be a clickable link in the show notes.

337

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Before we jump into the rapid fire.

338

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Is there anything else we should hit on?

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I'm good.

340

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Okay, well, first one is what lie do entrepreneurs often tell themselves?

341

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I think that they say, yeah, I love what I do, I love what I do, but when they really look

deep, right, they lie to themselves about these kind of things.

342

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But you know what, I think it's a healthy lie because in many ways as an entrepreneur you

need to be crazy in order to do what you're doing.

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So it's all about mindset.

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If you could go back in time and give your younger self one piece of advice, what would it

be?

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self-love right if you don't love yourself and if you don't have confidence in yourself

then no one else will it all starts from yourself uh

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I would say that it's all um self-forgiveness as well, not being your own best cheerleader

and supporter as opposed to your own worst critic.

347

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Do you have a book recommendation or what are you reading right now?

348

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So I love books in general.

349

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My book is great, called The Franchisee Lifestyle.

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But what I would say is in general, I love Brene Brown.

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She's just, to me, I saw her speak in person.

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I admire her.

353

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I think she just has such things that are just so relevant to today, and she has a brand

new book out called, about groundedness.

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I just think it's fascinating.

355

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And then finally, what single process or tool have you implemented that has had the

biggest time saving impact?

356

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What I would say is this, that I love having a great team, trusting my team, and most

importantly, although I'm not great at creating these processes, I other people doing it,

357

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something as simple as literally taking screenshots and having something inside of Google

Drive and saying, do this and do that, just kind of something to walk people through

358

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simply, it takes a long time to have that SOP, but it's really just a great practice in

case that person leaves or.

359

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ah They are going on vacation.

360

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just I'm a huge believer in having SOPs easily accessible

361

00:29:07,178 --> 00:29:09,290

Well, Adam, this was fantastic.

362

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I really appreciate you giving us the moment here today.

363

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One more time franchise coach.net.

364

00:29:14,857 --> 00:29:19,152

You're going to have that as a clickable link in the show notes, but I hope you'll

consider coming back again sometime.

365

00:29:19,152 --> 00:29:20,824

That was great to meet you.

366

00:29:20,948 --> 00:29:22,619

Thank you so much, I love the questions.