SPEAKER_02 0:01

There's a concept that comes from Stoic philosophy that was made popular by the book titled The Obstacle is the Way by Ryan Holiday. Highly recommend that to anyone if you haven't had a chance to read through that. Really life-changing paradigm, The Obstacle is the way. And we're gonna jump about a year forward in the journey to 2020 and share sort of where we thought we were going in 2020 and then where we ended up going in 2020 because of the pandemic. So let's set the stage here. So we're in January of 2020, it's the last year of my residency, and I had the opportunity to go do a psychiatry rotation at Mayo, Jacksonville. So I trained at Mayo Rochester, the mothership, and had the opportunity to go to the campus there in Jacksonville. And it was just, we were starting to see this kind of culmination of what we had worked so hard for all of those years since we had first gotten married, building our real estate portfolio. Nick was working full-time in our real estate business at that time. We had two kids. I was pregnant with our third. It was a month-long rotation. And it was gonna feel like a taste of, you know, what the future might look like. I was in the last year of my residency and we wanted to start to see what life would look like after residency. And so we spent that month in Jacksonville. And I'm so grateful for that because it forced us to say, you know, how could Nick run the business from Jacksonville? And so we had like a six or eight-week head start to doing Zoom meetings and everything.

SPEAKER_00 1:33

We were doing Zoom before it was cool.

SPEAKER_02 1:35

Yeah, uh, before the pandemic. And the timing, you know, just kind of worked out perfectly that COVID was in the news and everything, but hadn't really hit the United States. And we finished up the rotation there, got home back to our home in Rochester just a little while after that, about two weeks after that, that the World Health Organization declared the pandemic and everything really started to shut down. And then we had to run everything on Zoom and really figure out, you know, how do we continue to grow this business? And I think the main lesson here when I think about the pandemic, and I want to even go all the way back to episode one, is this concept of the obstacle is the way. And we're gonna share some just really funny stories in retrospect about the pandemic and the decisions we were making through the pandemic and the the late nights that we would stay up together, you know, wondering, oh my gosh, are we making the right decision? Is this wise of us? Um, the obstacle is the way. So even this whole journey started because Nick and I both owned our own personal homes before we got married. When we got married, we moved into his home. And I'll be very transparent, I wanted to rent out, I'm sorry, I wanted to sell my home. I knew that we wanted to do real estate investing. We had learned that from so many mentors, but I had reasons why it wasn't the right time. We had just gotten married. I was about to go to medical school. I was hoping that we would have a baby sooner rather than later. And so I wanted to sell that property and oh, you know, we'll we'll invest later when it makes more sense. And this was in 2011, and we were still as a country in the post-2008 recovery, and we had that home on the market for weeks and weeks and weeks. We weren't getting any showings. We were lowering the price, lowering the price. And it got to where even if we had an offer in hand, which let's be clear, we didn't even have a showing in hand, let alone an offer. Um, but let's say we miraculously had had an offer in hand, we would have needed to bring like$30,000 cash to close because I owed more on the mortgage than we were able to sell it for. And so we decided to rent that home. And it was very scary. And, you know, had I had it my way, we would not have done that. We we would have sold it and had started our real estate journey in the future. And knowing what I know about human behavior, I wonder if we ever would have started our real estate journey. Right. That's just, you know, one thing leads to another, and then it might be, oh, well, now we have young kids in the home, or now we have two kids, or now we're moving to Rochester, you know, whatever it is, right? That's that's how the human mind works. Um, so the the very start of our entire journey was all the obstacle is the way. And I look back now and am just so, so, so grateful that we had that struggle in 2011 that led to us even starting this real estate investment journey and the struggles that we had in 2020 with the pandemic that led to a massive acceleration of our real estate journey. And I would just encourage everyone that's listening. You know, we we fully recognize that our listeners come from, you know, vast walks of life. You're in, you know, varying circumstances, all of the things. And some portion of you are in a place right now where there is a struggle, there is pain, there is suffering. Maybe the episode on joyful suffering didn't resonate, and you're thinking, no, Elaine, I am just in real suffering. And I get it, real suffering exists. Not all suffering is joyful. I do believe that we have the opportunity to tell ourselves empowering stories, but I'm also not naive enough to believe that all suffering is joyful. And if you're in that place or you've been in that place before and you're reflecting on it, what I would encourage you to think through is the lens of how can the obstacle be the way? How can it be that this period of hardship or trouble or things going the opposite of how you want them to go? How can that be the ticket to your next level of growth? We all have to go through pain in our lives. We all have to go through suffering, struggle, trouble, not getting our way, you name it. That's part of being human. And yet we all don't get the growth out of it. Many of us just get the suffering. And I'll offer to you the perspective that if you're gonna get the suffering, you might as well get the growth too. You might as well get the up-leveling. And that's how this whole thing started. And then here we are in our story in 2020. And Nick, why don't you uh set the stage for us? You know, we'll kind of bounce back and forth around the pandemic and the decisions we were making in 2020. But why don't we tell the story of when you're standing on the curb in 2020, kind of looking around and asking yourself the question of what are we doing?

SPEAKER_01 6:42

Well, let's uh let's do a couple and then culminate with with that. So it I think sometimes it's easy to look at our journey and think that it was easy or think that I don't know, we're just strong, perfect people or something like that. But just think about this. So I left my day job June 2019 and talked about how we got all these you know deals under contract, and we're just I mean, we're trying to explosively grow this business. And then all of a sudden the pandemic hits. And if we're not doing deals, if we're not representing clients, if we're not running our business successfully, our income stops. And there was like the payroll protection plan. Well, we had no payroll, so there was no protection plan.

SPEAKER_02 7:20

I think we had like 1.5 employees at that point.

SPEAKER_01 7:23

We weren't eligible for an EIDL. We we actually got our first employee during the pandemic, and it's very challenging to your identity to boldly go forth and then all of a sudden, you know, the whole world shuts down and flies in the face of your plan. Men make plans and and God laughs. And it was pretty crazy back then. It's it's easy to forget just how crazy it was at first, but for a while there it was unclear if a real estate agent could do showings. And if you have a listing, are you allowed to have an open house? No. And then there's these concepts of like virtual showings, and for a while the whole market stopped. Transactional volume just completely halted. We, you know, bless Elaine, she was just a step ahead this whole way through predicting, you know, what would happen with the pandemic. She just looked at the last, you know, half dozen pandemics that humans have experienced and said, well, you know, history rhymes, let's let's assume that it follows that trajectory. But it was still unbelievably scary. And yet at the same time, this was the first time that Elaine and I really confronted an incredibly challenging situation with the coaches, with the thought leaders, you know, that we have in our life today. So, for example, Tony Robbins, you know, big mentor of ours, he you know puts out this video about how people every day go out and and drive their car, and there's nothing but this little yellow line preventing you from having a fatal head-on collision with someone else, and we're okay with that risk of mortality, and yet uh people are you know losing their minds about a pandemic, and you need to just like check that scarcity thinking and ask, you know, how can you how can you add more value? Where is the way that you can serve? And all negative emotions are inward-facing. If we just sat around and said, Oh, woe is me, our plan for launching this big thing is is ruined, we're just gonna sit on the sideline. You know, those are all inward-facing emotions. But when you say, Okay, well, there's a lot of people out there who are scared right now, and there are there are literally people who are dying, where can we serve? Where can we serve? It's very difficult for fear to live in that state. And I remember uh Gary Keller just coming out immediately and saying, Listen, y'all, talent has never been on sale like this. This is the only time in your lifetime this will ever happen. So many employers mass laid off employees out of fear and uncertainty. And Gary said, If if there's any way you can afford it, you you must go hire right now. And so we followed Tony's advice, we followed Gary's advice. We we hired our first full-time employee March 23rd of 2020. The most insane time, and we got you know, prop probably the greatest hire of our entire business career, Stephanie, who's now our director of operations. She basically ran our entire you know, admin portion of our business when you know she was our only employee and has grown along with us. She was a GM for Marriott, would go around, you know, she was a fixer for their hotels. And originally she took a big pay cut to join us because she got laid off. She was she was a rock star employee for their organization for years and was suddenly without a job. And when you're the only person who's hiring, you can have your pick of amazing employees. You know, today it's tougher to find good people. Talent's not on sale like it was then. It's just so unbelievably powerful to have people like Tony and Gary in our corner and you know, not not telling us you know exactly what to think and what to do. Well, I mean, I actually I guess that is kind of Gary said go hire someone right now, and that's exactly what we did. And I mean, I credit so much of our success with that is just finding people who appear to know the road ahead, who appear to make good decisions, to solicit their advice quite directly, and just to do what they say, and you will you will do well. I remember doing a talk as a real estate agent for a large group of other real estate agents in the throes of the pandemic. And this was, I mean, this was like a huge turning point in my life talking about the seasons and talking about how never in my entire life has the public, has uh our customers, our clients as real estate agents been this hungry, this starving for connection, for service, for love. As an agent, a lot of what your job is is to pick up the phone and call people and hope that they pick up the phone and answer and don't kind of have this sigh when they pick up the phone and ah, is someone trying to sell me something. Man, everyone is picking up their phone when you dial at the peak of the pandemic. And it was very weird because you know, until that moment, I feel like Elaine and I were very, I don't know, normal or or in the in the normal common consciousness or something like that. And and in, you know, like the 20, like the 2018 or 2017 Nickney Lane might have circled the wagons and said, okay, we're gonna, you know, we're gonna go get our W-2 job back. We're gonna stop everything we're doing with this real estate, you know, venture thing we're doing. And the the Nickanie Lane that had the benefit of that counsel from people like Tony and Gary, we grew explosively. We we were the first to stop buying. Elaine saw it like weeks ahead of time. We stopped everything, we saved every penny. Then Gary and Tony said, offer more value, hire more people, the the opportunity to grow. It's just around the corner, and you will know the moment it happens. If you are looking, if you are looking, you will know the moment it happens. I remember that. And we saw it. We saw it in June of 2020. We saw the first green shoots of spring. It didn't seem like everyone was going to die. Some people would die, but not everyone. Interest rates were low, real estate was on sale, and I I remember the day we said, we are going to hit the gas, we are going to buy everything we can possibly get our hands on. We called every investor, we raised every penny of capital we could, we bought as many properties for other people as we could, and we grew explosively.

SPEAKER_02 13:21

So if one of the big lessons from the pandemic was the obstacle is the way, the other two were really that we lived out for the first time, I think, ever in our lives, this idea of the seasons and that the seasons are always cyclical.

SPEAKER_01 13:34

And I just got Elaine a seasons poster today. Did you notice that it was in your office? It was a gift for you.

SPEAKER_02 13:40

No, I haven't seen it yet. I haven't been in my office yet. I'll have to I'll have to see it. Um that there's there's something good and something bad about every season. And you never, you know, you kind of don't have to worry too much about any given season because whether you like it or hate it, the next one's gonna keep coming. And then also having a really long time orientation. So I think to some extent, both Nick and I have always had a longer time orientation. I think maybe that comes from our childhood. And, you know, we both kind of long story short, we both had a lot of scarcity and troubles in our childhood because of our family of origins, and knowing, you know, even well before we ever met each other that we wanted something quite different in adulthood. But the pandemic was really the time that while everyone else was focusing on, oh, are we going to be closed for a week or two weeks, or oh, you know, there's no way things can be closed for more than 10 days or whatever. I'm no genius. I have no, you know, major background in epidemiology. Yes, I am a physician. Yes, I went to School of Public Health before that. So I admit that I have a bit of a leg up, but I just really went and studied other pandemics. And it seemed like most pandemics lasted about two years. And I thought, well, maybe this one might go a little bit faster because of modern technology, and maybe we'll get a vaccine out faster, but it might actually be worse because the world is so interconnected and you know, air travel and those sorts of things. But we were able to say, okay, this period of vast, vast, vast uncertainty, this is not going to last for weeks. This is going to last for months and or years. And if we just keep our wits about us and make reasonable principled decisions and not get so wrapped up in fear or optimism, right? The fear of, oh my gosh, things will never be the same. In general, humanity kind of reverts to the mean, you know, over and over and over, and also not get wrapped up in optimism of, oh, everything will be back to normal in two weeks and everything's gonna open back up, but instead recognize this is gonna take a couple of years, and we don't exactly know what the future is gonna look like, but we're gonna make the best decisions we can. And we had had an iteration of that earlier in our real estate investing career when we were talking about buying up foreclosures and those sorts of things and recognizing that there was so much distress in the market and that wasn't gonna last forever. And so we were able to do that iteration again. Nick just came in with this uh beautiful piece of art that he just got for me that I'm seeing for the first time. It's a tree.

SPEAKER_01 16:20

Couldn't have planned this better.

SPEAKER_02 16:21

Yeah. Um, so a long time ago, we had a piece of art in our office that was similar to this one. It was a tree with like, you know, green leaves and then or like green shoots, you might say, and then green leaves and then autumn leaves and then the bear tree. And this one's similar to that. Um, it's it's a little more vibrant and and really good. We found it on the side of the road.

SPEAKER_01 16:44

So we we got a slightly classier, at least a new seasons poster. Uh that's what I got for you, Lane.

SPEAKER_02 16:50

Well, thank you. I I I appreciate the gift. It's beautiful. It says, in every season I will praise him. Well, thank you for that, my love. Yeah. Could couldn't have couldn't have to couldn't have timed that better.

SPEAKER_01 16:59

Couldn't have timed it better.

SPEAKER_02 17:00

Yeah. So here we are, kind of in June of 2020, recognizing that pandemic's gonna be around for a while. This thing isn't wrapping up in a week or two weeks. There was some certainty in terms of morbidity, mortality, kind of what the cycles might look like. Summer was good in the United States, you know, relatively speaking, right? There's there's less respiratory illness in the summer. We could predict that things would get worse in the winter. That's when there's more respiratory illness.

SPEAKER_01 17:30

And it was much worse up north than it was in the south. And so there was a huge boom in the south and and a bit of a bust in the north.

SPEAKER_02 17:37

Yeah. And we went back to our roots, which was all the way back at the beginning, when we decided that we were going to double down on real estate. And it was the exact same muscle memory as when in the very beginning people would say, Are you crazy? You're too risky, what are you doing? This is insane.

SPEAKER_01 18:01

We didn't get a little word cloud to go in our office and produce that stream of consciousness.

SPEAKER_02 18:07

Um But we had a little muscle memory. And you know, like like Nick said a couple minutes ago, history rhymes. And that's true for your own life, that's true for generations, that's true for cultures. Think about that. Um, you're gonna hear us talk through these episodes a lot about visioning and trying your very best to predict the future, and that is getting way harder with AI and just the pace of change and those sorts of things. History doesn't repeat itself, but it does rhyme. And we were able to see a variation of the beginning of our real estate journey, you know, almost 10 years later. So we started investing in 2011, here we are in 2020, and we're feeling that same sense of the market is uncertain, people are fearful, no one wants to take the lead. And, you know, we did a little bit of that in 2011, but only a couple of properties, right? We were young, we had just gotten married, we you know, had very little access to capital. And so we had an opportunity to do it at a much bigger scale in 2020, and we had to decide: is that the path we're gonna go down? Or are we going to go down the path of fear and withdrawal? And we said, you know what, the obstacle is always the way. Let's go.

SPEAKER_01 19:30

Let's talk about that tactically for just a second. So we were, you know, out driving for dollars, looking for distressed properties and uh, you know, kind of running that sort of that sort of playbook uh right up until the pandemic. And we uh had had just dipped our toe into the water of of multifamily, and then we kind of put everything on pause when Elaine thought that there was a pandemic coming. And then basically when the when the world, I would say, hit kind of peak fear, peak fear, but we had our first few pieces of data, a few first few glimpses that this was not going to be catastrophic, and we could start to see the rhyme with history, and from our perspective, we saw the first few green shoots. We went and we started offering on properties which were 20 times bigger than anything we had ever done before. 30 times bigger than anything we'd ever done before because we knew that this was the opportunity. This was the maybe once-in-a-lifetime opportunity. So we offered on you know one townhome community. We did not get it, but we offered, I think, you know, 30% below asking. We bought a 30% vacant apartment building with uh with a joint venture partner. We bought a build-for-sale townhome subdivision, Stonehaven Townhomes, that it went live in February of 2020, just about the worst time you could have a new build-for-sale product go live. Then when the entire real estate market shut down and you couldn't transact, you couldn't do open houses, they decided to go for this, you know, kind of uh build-for-rent thing and started renting out units, then quickly figured out they didn't want to be landlords, and now they had this weird hodgepodge community, and we purchased that at an extraordinary discount. We got that under contract towards the end of June in 2020, when you know, if you go to the front page of CNN, it was just all doom and gloom. Just people are, you know, just just death and destruction and and and stagnant. And uh that is when we were buying huge deals, massive deals that we knew we were getting at a fantastic price.

SPEAKER_02 21:40

And we couldn't when you were when you were kind of forming your thought and you were saying um we bought deals that were like 20 or 30 size, 20 or 30 times the size of what we had bought before. What I thought you were going to say is we bought deals that were previously unbuyable because they had been held by the same ownership for decades because they were so. Such prime real estate, very close to the Mayo Clinic, which is our major employer here in town. And, you know, people wanted to hold them forever. And then all of a sudden, there was a lot of struggle. It was high vacancy. People were working from home. Even as a hospital, Mayo Clinic was cutting back on a lot of things, switching to virtual visits, those sorts of things. And um we said, well, pandemic won't last forever. Might last a few years, and we need to be wise about that. Yep. But it won't last forever.

SPEAKER_01 22:30

So I'll close with that story. We bought, you know, a decent chunk of downtown Rochester, you know, things that were unbuyable. And it got to the point where we had, I think, seven different apartment buildings under contract at the same time. It was pretty crazy. And the people selling to us thought we were crazy, thought we were young, naive, reckless, and we knew that we just had to hang out for two years. But that's it. And we could do a value add plan during that time. But we would purchase apartment buildings that used to be full all the time and were now, you know, 50% vacant, literally. Uh just this huge exodus from uh downtown Rochester. But we knew that that Hospital of the Future was coming, you know, uh Destination Medical Center was was real, that the Mayo Clinic has a far longer time orientation than just about any other organization on earth, including you know the U.S. government, and we could back that horse and we could win and we could we could hold out for two years. But there were moments I remember, you know, kind of uh with Elaine's foreshadowing, standing at the intersection of what was normally a very busy intersection in downtown Rochester, and I looked around and I saw about half a dozen people. This was after we had closed on like those seven or ten apartment buildings, and I could see about half a dozen people. I'm like, well, at least there's a few people out and about. And then I looked around more closely and I realized that every single human that I could see was on our payroll. Not a single member of the public, not a single male employee, not a single.

SPEAKER_02 23:57

I wish I had been there with you. I heard the story, you know, later that evening. I I wish I had been there with you to see like your body language and your facial expression.

SPEAKER_01 24:05

Yeah, not so bad. There's a few people out here, you know. There's there's that guy and that guy and and that guy, and I know every single and I'm actually paying every single one of these people to be here. It is a very weird feeling to be in a downtown, urban core, high-rise environment, and the only humans you can see are the ones that you are paying to be there. And again, we had to challenge ourselves and say, are we are we crazy? Are we are we going too far, too fast, or whatever? We have some really good coaches, mentors that we that we pay, that we uh solicit for advice all the time. And and Elaine has been a phenomenal chief risk officer. And you know, over and over again, we'd kind of you know run the numbers and just see if they if they fit our thesis. And the the answer was yes. And so we kept going, kept going, kept going. And now today we've got we've got a bunch of lotto tickets that have all pretty much you know come up winners, at least in the at least in the long term. So the the obstacle is the way. If you understand the seasons and you know how to grow in winter, how to you know uh run run west when everyone else is running east, to to buy when no one else is buying, you can get life-changing opportunities, you can get access to life-changing opportunities. And I it's it's just searched in my memory there, like speaking, speaking to those agents in you know, March of 2020 about how can you create more value, how can you reach out to people, and it truly is that simple. Anytime you see something that is scary, something that is an obstacle, something that uh is is the reason why everyone says no, if you can figure out how to say yes, my friends, you are going to do something amazing with your life in terms of profit, contribution, creating amazing relationships, changing the course of someone else's life. It's truly that simple. It's truly that simple just just finding a way to be contrarian and to be right and to have the confidence to bet big when you are contrarian and you are right. That's that's all there is to it. So there's lots of scary things that happen in life. I don't know if we're gonna have something scarier than a pandemic in my life. I you know, probably, I suppose, but AI? Uh AI is quite scary, but it's not.

SPEAKER_02 26:22

AI is like scary, but also in this current state in 2026, interesting. Yes. Whereas the pandemic was just straight fear.

SPEAKER_01 26:32

Yeah. Like there's a good, call it 20% chance that AI could uh you know eradicate humanity uh in our lifetimes. And that's you know, that's not my numbers, those are the you know, the expert numbers. You know, great, great book. If anyone builds it, everyone will die. It's you know a book written by all the top you know experts on AI in the world. And uh people just accept that. Somehow that's okay, just like how they accept that you might get into a car accident when you go out on the road. And yet somehow when the pandemic happens, even though your odds are much better than 80% chance of survival, people just lost their minds. And it's just it's very interesting to see the common consciousness and and how it does or does not handicap risk appropriately. We are very careful about buckling our seat belts when we drive. We are uh we we are uh violent about passenger safety and having kid car seats buckled in and stuff like that. And most people discount that risk and and then overestimate other risks. And anytime you can just be a little more clear-eyed than the common consciousness about risks, that's when you can you can have an incredible differentiating advantage in not just financially, like how can you make yourself into a superhuman with superpowers in general, the people who are willing to take on calculated risk, those people get a disproportionate amount of reward, of of emotional reward, of of spiritual reward, and uh just understanding how to how to steal your emotions and and just just do the math. Become a student of history and look for the rhyme and be a student of the seasons. That's where that's where incredible tales are told. So I hope you've enjoyed this tale. It's very interesting to walk through memory lane here. And uh, we've got we've got a couple more chapters coming up here for you in the near future. We hope you uh you find this impactful. If you have, please feel free to like and subscribe and follow us in your podcast platform of choice. And we will catch you in the next episode.