Your philosophy is the foundation of your business. It’s where you align your service and decision-making. In this episode, Ashley Wilson shares how she and her team are making their mark in the business. Ashley is the Co-Founder of Bar Down Investments and HouseItLook. She joins Sam Wilson to discuss her philosophy about creating massive impact for investors by making less to help investors make more. To date, she has been involved in over $100 million in transactions. It’s all about building long-term relationships with the right people. Ashley also shares how giving up control can be a good thing in business. Listen to their discussion and get valuable insights on investing, managing a team, and more.
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Ashley Wilson On Her Real Estate Philosophy And Building Long-Term Partnerships
Ashley Wilson is the Cofounder of Bar Down Investments and HouseItLook. She’s the best-selling author of The Only Woman in the Room: Knowledge and Inspiration from 20 Women Real Estate Investors and a BiggerPockets series host. She has years of real estate experience and has been involved in over $100 million in transactions within both single-family and multifamily real estate. Ashley, welcome to the show.
Thank you for having me.
The pleasure is mine. There are three questions I ask every guest who comes on the show. Can you tell us where did you start? Where are you now? How did you get there?
I started with house hacking. Most people think that their first foray is maybe flipping or wholesaling but a lot of people when they think about it, it’s house hacking. Most people get into a situation where they have a roommate or rent some portion of real estate that they may already own or they’re renting and subleasing. That’s what happened to me. I have done a little bit of almost everything. I’ve done short-term rentals, long-term rentals, flipping and now we’re in large apartments. Our primary focus is buying, repositioning and then selling large apartments.
Talk to us about that process as you went through that. There were some steps along the way when you decided to go bigger and said, “We’re not going to do short-term rentals anymore. We’re going to do multifamily properties.” What was that process like?
I think of it almost like a river and my life was the river walls and it guided me and that took me along different paths with real estate, meaning that I was never married to one concept going through the process. I was learning and being open to different asset classes that supported where I was in my life and my journey at that time.
When I first started in real estate, I had a W-2. I was doing quite well in pharmaceuticals. I worked in clinical research and development for three of the top pharmaceutical companies in the entire world. I was being fast-tracked in that profession and doing very well. It was a matter of more what my bandwidth was at the time that lent itself well to house hacking and eventually short-term rentals.
You can be successful in any aspect of real estate in any asset class. That’s what’s so exciting about real estate.
Short-term rentals are fun because it’s easy to automate even when I was doing it. We think about all the technology that lends itself now to short-term rentals that makes it able to be automated but I was able to automate it years ago. It’s even easier than it was now. I look back and I think to myself, “How did I not stay in short-term rentals?” It was lucrative then. We were making hand over fist when we were doing it. Different things in my life came up and then different aspects of real estate presented themselves as opportunities.
As we all know as entrepreneurs, we all have shiny object syndrome. That’s how we become an entrepreneur in the first place. It’s being open to different ideas but having a balance of when to say no. In the beginning, my no was often guided by my bandwidth as opposed to my internal barometer making those decisions. Over time, I’ve had to massage that, become stronger at saying no and figure out what supported my long-term vision, my why and what I wanted out of life. That married very closely to what large multifamily provides.
When you say balance, bandwidth and the idea of what you wanted out of life, at what point in time did the fast-track career and the appeal of that become such that you said, “I’m going to walk away from this and go into real estate.” That would be very hard for a lot of people to do.
I’ve always been an entrepreneur by nature, even when I look back as a little kid there were certain things that I did in school that were foreshadowing of where I am now. When I look back to where I was in pharma and stepped away, my ultimate goal was to become a CEO of a large pharmaceutical company, one of the top companies in the world. I know 100% that I could have achieved that.
At the end of the day, I was sacrificing the whole reason I went into that profession in the first place. The whole reason I went into that profession and worked my ass off is that my parents provided so much support for my brother and me that I knew that the most important thing that I wanted out of life was to be able to have the flexibility to make decisions and spend time with my family whenever I wanted to.
My parents were able to achieve that despite the fact that we did not grow up wealthy at all. My dad was self-employed as a general contractor. We went through different market cycles. I saw the impact a down market has on construction and real estate. On the other side, my mom worked for a small business as a business manager for the entire company. She had that flexibility because she worked for a friend of hers that she grew up with. They had a longstanding relationship. She had this flexibility in her profession.
What I thought at the time was if I become a CEO of a company, I could call my own shots and make those decisions but what I didn’t realize is I was sacrificing so much along the way to get there. I was in this hamster wheel because I was in a situation where I kept running in this spinning wheel. Even though that wheel moved throughout the hamster cage, I was still in this cage, working for someone else. Every single Monday I was working on someone else’s dream, not my own and trying to implement my dream within someone else’s dream.
Conceptually, I liked what I was doing in research and development. I led a trial that ended with approval for chickenpox vaccination for pediatrics in India that I’m super proud of. At the end of the day, when I’m looking at what am I doing for my family, there was a monetary contribution but in terms of being there for my family, which you cannot put a dollar figure on, I felt like I was sacrificing so much.
I made the decision to go out of that profession and started a few other companies before landing in real estate. At the same time, I was doing real estate on the side. I never considered real estate when I first left my job as something that I would work in full-time but now I work in it full-time and have for many years and it has become a part of my life.
What was the moment when you knew that you were onto something in real estate?
You can be successful in any aspect of real estate in any asset class. That’s what’s exciting about real estate. That’s why we get drawn and get distracted because you always know someone who’s an amazing wholesaler, flipper and amazing at apartments or industrial notes. You know someone in every asset class because it’s possible to be very successful in every single asset class.
To me, that was something exciting. The other component that I always tell this story is this one year. We did our taxes and my entire salary went to pay for the taxes for the year. I was making six figures, doing very well and my entire year went to paying taxes. Mentally, when I paid our taxes that year, I had a hard time thinking to myself, “I worked for a year for free.” That was very frustrating to me.
The great thing about real estate is our government has decided that real estate is a problem that they can’t solve. They incentivize the wealthy to invest in real estate so they don’t have to tax the masses to offset that national problem that we all face. With that, it attracts people and capital to these different social issues we have and becomes a tax write-off and a tax incentive for investors. For me, to marry those two concepts and have the flexibility when you look at real estate as a whole was a perfect solution for what I and my family was looking for.
As entrepreneurs, there are times when we may end up working a year and still be a breakeven year. I’ve had plenty of those where you’re like, “I worked all year long and didn’t make any money,” but it’s an entirely different situation when you’ve worked all year and then write that check to the taxman. That makes my stomach hurt. That sounds like that was one of the launching pads that took you to where you are now saying, “There’s a better way than this.”
When you have financial independence, you make decisions not governed by finance but by factors that are floating around in that decision-making process.
What were some of the steps that you took from that point of saying, “There’s real estate.” How did you get to where you are now? You have a large team and are buying large multifamily properties. The last one I saw was there are 409 units that you are working on. That’s a big acquisition. How did you get there?
Hard work and consistency. I can tell you that I’ve met people who are smarter than me but I will outwork anyone. I am very consistent in my work. I get up every single morning and work every single day. That includes weekends and holidays. I don’t associate myself and hang out with groups of people who come home from work and then watch TV, sit on the couch all evening, eat potato chips and do that stuff. That’s great. I’m not trying to knock anyone who does that but that’s not me. That’s the differentiator.
There’s a philosophy of the 10,000-hour rule. My philosophy is I’m going to get to 10,000 hours before anyone else has. That’s from putting in that consistent hard work and that’s inclusive of holidays and vacations. Even though I want the flexibility to do whatever my family needs, and I have that flexibility to do that, I also recognize the balance between, “I’m going to spend the entire day with my family but I’m going to get up two hours earlier so I can get my work done for the day and don’t have to worry about it,” but I put in that time. I didn’t ignore it and forget it.
Consistency beats out so much competition and so many challenges that you face because if you’re constantly trying to solve problems and provide opportunities for people then it turns into a machine. We’re doing very well. I’m proud of where our company is at, what we’re building and what the future is for our company. We’ve set realistic goals and we’re going to exceed those goals.
We stick to our morals. We’re not a team that acquires for the sake of acquiring. We’re not focused on the unit count. Most people define their metrics off of unit count. We don’t define it off of that. We define it off of our investor’s returns. That’s a different philosophy so we’re very strategic on the investments we select. Less is more in our opinion.
There’s the whole philosophy that you either do massive impacts for the few or you do incremental impact for the masses. Our focus is doing massive impact on the few. We’re not trying to get thousands of investors and to have a deal rolling out every week with the potential of picking deals for the sake of picking deals and maybe the returns aren’t as strong.
We’re very critical of the deals that we select. We put multiple safeguards in place. We want to outperform our projections every single time, which is why we put many conservative measures in place. That speaks to our underwriting cap rates, exit cap, analysis of rental projections, other income, expenses and how we operate. We operate on such a micro level that I don’t think most people operate on that level. It’s very heavy in terms of the human power needed to oversee the machine. At the end of the day, it speaks volumes to our investors and creates wealth-building opportunities, which is why people are attracted to us.
When you’re not operating on a unit count and dollar amounts of deals getting done, how is it that you are able to continue to fund that machine if you are sharing the bulk of these profits? I did some research on you and looked at some of your splits and things that I go, “That’s generous on the investor side.” How are you able to continue to do what you do if you are staying micro-focused and juicing the returns for your investors? How do you keep your machine running especially with the number of personnel you have?
There are a few different components to it. The first component is that when picking a partner, one of the things that are often overlooked is where someone is financially. When you have financial independence, you make decisions that are not governed by finance but governed by the factors that are floating around in that decision-making process. It doesn’t become emotional because it’s all based on the facts that are presented as opposed to, “You need to make an acquisition fee to be able to survive that year.”
My partner is J. Scott and we align on many different things. We are complementary in skills but we align in terms of ethics, work ethic, morals and family values. We’re also aligned financially. We didn’t get there overnight. We worked very hard to be there but we are very aligned in terms of our financial situation. That allows us to come to the table with this same decision-making in the sense that this to us is a marathon. It’s not one deal, get rich, let’s go and do something else. We’re in it for the long run.
We would rather make less and our investors make more so we create more opportunities. Our investors come back and they recognize that we are in it for them. That creates trust. Trust comes with respect and that’s what we want to build and loyalty. That’s the other component. We feel that giving up a little bit more creates loyalty and that continues to reward itself in the long-term that people see we’re doing right by investors. That’s important for us. One part of your question is that we’re creating situations where we’re sacrificing a bit upfront so we can have the overhead and create this machine.
The second component is being aligned with the people that want to partner and work for you. In terms of the traditional way in which people hire, there are a lot of people in multifamily that are very selfish with their returns. They want everything for themselves and hire out everyone. There are positions within companies that you can hire out but there are other positions where to have true alignment, you have to have alignment in terms of some portion of equity. We also offer in certain roles that equity to create alignment. That allows us to work towards the same goal and be motivated by the same factors, which then in turn we all win. We win and work together. That’s what we’re trying to create.
When it comes to equity and alignment of goals, how do you structure it such that someone gains equity but not control it? This is a very strategic and nuts and bolts question. You bring partners or team members on and the next thing you know, it’s like, “This is not a good fit.” How do you do that, protect the integrity of the company and at the same time motivate people who come on board?
Historically, we haven’t partnered with anyone we haven’t known for at least a year. That gives us a great opportunity to get to know the individual. When you’re in large multifamily, it’s not like flipping where it’s a very short-term partnership. It’s a long-term partnership so you have to be aligned on many different fronts. The word control typically has a negative connotation but we look at it in terms of the opportunity and the positive connotation control can have.
The team is the most important component of every single investment you will ever invest in.
Control can also have the connotation of autonomy, responsibility and accountability. If you’re partnering with the right people, you do want them to have control over certain components and be an expert on certain components. The great thing about investing in large multifamily is you’re buying a business and you get real estate attached to it. The reason why that way is because it has many different aspects.
You can be an amazing accountant and be good at multifamily or a lawyer, marketing, property manager and sales. There are so many different skillsets that are needed within the multifamily business. If you allow someone to control that aspect of your business plus have alignment and they’re a true expert then you’ve hired the right person. To your point on control, they think that they’re giving up something instead of realizing what opportunities can be created.
We hired a new asset manager and I trained her for a year prior to her coming on board. What we were able to do by bringing her on board is she has now the experience of how I make decisions and also has experience before from the properties that she was managing. She’s going to breathe new life into our company, understand the rationale of how I make decisions, coupled with how she made decisions at her previous employer. That inevitably frees up time for me.
Giving her control, autonomy and responsibility allows her to own and control that process but it also allows me to focus on building the company, acquisitions, connecting with private capital or whatever the case may be. It allows me to build and focus on other aspects of the business. Control can be a very good thing.
Ashley, I appreciate you taking the time to pull back the curtains on your company. You’ve given us lots of things to think about as far as planning, when to take the next steps on training and mentoring new employees and how you think. This has been good. I love the way you approach investors, build your machine inside your company and how you relate to your investors. That has been helpful. Let’s jump here into the final few questions. One of the questions is this. If you could help our readers avoid one mistake in real estate, what would it be? How would you avoid it?
It’s jumping in too quickly without having all the information. You have to spend a bit of time especially if you’re passively investing. You should always look at the team first, the market second and the returns third. Too many people look at the returns first. They look at the market and then sometimes at the team. The team is the most important component of every single investment you will ever invest in.
Next question. When it comes to investing in the world, what’s one thing you’re doing now to make the world a better place?
We go into every single property and not only make sure that the property is a better community for the tenants but we make sure our property, tenants and everything is a huge benefit to the community at large. We partner with local businesses, charities and organizations. It does not take much but every single month we do something with some other business or agency within the local community. It’s always good to give back.
Ashley, if our readers want to get in touch with you, what is the best way to do that?
You can come to our company’s website at BarDownInvestments.com. You can also follow me on Instagram at @BadAshInvestor.
Ashley, thank you. Have a great rest of your day.
Thank you. You too.
Important Links:
- Bar Down Investments
- HouseItLook
- The Only Woman in the Room: Knowledge and Inspiration from 20 Women Real Estate Investors
- BiggerPockets
- @BadAshInvestor – Instagram
About Ashley Wilson
Ashley Wilson is the co-founder of Bar Down Investments, LLC and HouseItLook, LLC. She has over 10 years of real estate experience and has been involved in over $40 million in transactions with both single- and multi-family real estate. Ashley leads asset and construction management on her multifamily investments and has provided operational consulting for several other large multifamily owners throughout the country. Additionally, Ashley and her father have a very successful high-end flipping business in Pennsylvania, HouseItLook LLC, which handles several million dollars in transactions annually. When Ashley is not working on her businesses, she enjoys spending time with her family, including her husband and their two daughters, and enjoys competing with her horse.
