Latest / Elevate The Hustle / E37: He Worked for the Wolf of Wall Street. Now He Insures $5B in Real Estate.

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E37: He Worked for the Wolf of Wall Street. Now He Insures $5B in Real Estate. · Elevate The Hustle

0:00
SPEAKER_01: You want to buy a car?
0:00
SPEAKER_01: I had to match two grand to come up with a car.
0:02
SPEAKER_01: Everything was matched.
0:03
SPEAKER_01: I had to sign a contract with my father.
0:05
SPEAKER_01: Nothing I did was good enough with him ever.
0:07
SPEAKER_00: Elevate the hustle.
0:09
SPEAKER_00: Yeah.
0:15
SPEAKER_02: Welcome to Elevate the Hustle, where we break down what it actually means to build teams, scale companies, and lead with intensity.
0:22
SPEAKER_02: I'm your host, Staten, and today we have a very special guest with us today, former EO South Florida president and entrepreneur Jerry Katz.
0:36
SPEAKER_02: Welcome to the show, buddy.
0:37
SPEAKER_01: Thank you, buddy.
0:38
SPEAKER_02: Excited to have you on.
0:42
SPEAKER_02: We're gonna go into your history, who you are, and what you do.
0:46
SPEAKER_02: But first, I like to lead off this show by asking one simple question.
0:52
SPEAKER_02: What does the word hustle mean to you?
0:55
SPEAKER_01: What does the word hustle mean to me?
0:57
SPEAKER_01: Well, it means find a way.
1:00
SPEAKER_01: Take a personal responsibility.
1:02
SPEAKER_01: It's easy, I think, for me to answer.
1:04
SPEAKER_01: Take a personal find, you know, responsibility to somehow, some way, always find a way.
1:11
SPEAKER_01: Right?
1:12
SPEAKER_01: Constantly find a solution for the problem and never give up.
1:18
SPEAKER_01: And that's really what it is.
1:20
SPEAKER_01: Finding inefficiencies and you know, and never giving up.
1:23
SPEAKER_01: Being relentless in the pursuit of whatever your problem that you're solving, I guess, for the world as an entrepreneur.
1:30
SPEAKER_01: So that to me is hustle, and that's the never give up mentality.
1:35
SPEAKER_01: That's what uh without getting too crazy, that's what separates Stan and myself from 99.9% of entrepreneurs who are dreamers and not hustlers.
1:49
SPEAKER_02: I love it.
1:50
SPEAKER_02: I love it.
1:52
SPEAKER_02: So let's go back.
1:54
SPEAKER_02: At what point in time did you realize that you're, you know, gonna be an entrepreneur or you are an entrepreneur?
2:00
SPEAKER_02: What was your first hustle?
2:02
SPEAKER_02: How did it all come together?
2:04
SPEAKER_02: How did it start?
2:05
SPEAKER_01: Yeah, so I mean, if we go really far back, I would say it was, you know, I'm an immigrant.
2:11
SPEAKER_01: I came in from I came from Russia, I was three years old, and you know, uh, my mother was an uh mechanic, my mother was a chemical engineer, my father was a mechanical engineer, we didn't have the language.
2:22
SPEAKER_01: We came over here with my brother and my grandparents, and my grandfather was uh a real hustler in Russia where it was communism, we were Jewish, business is illegal, religion is poison, but somehow my grandfather was a very well-off man in Russia.
2:40
SPEAKER_01: Why?
2:40
SPEAKER_01: Because he was a good black marketeer, is what it comes down to it.
2:44
SPEAKER_01: So I live in his roots, that's what I'm always told, and I radiate his energy.
2:49
SPEAKER_01: But it's funny, when my father wanted to immigrant to the United States in 1975, he had to convince my grandfather, which was my mother's mother, to come.
2:58
SPEAKER_01: And at that time, he had a, for example, a a uh they had a store that was owned by the government in the Moscow subway that had sweaters.
3:06
SPEAKER_01: So my grandfather had like 40 Jewish women knitting sweaters in basements of houses, and they were selling them on the side, generating cash flow, and you would use the bribe money to get us better apartments and things.
3:18
SPEAKER_01: But he had to convince my grandfather to leave all that, and it was difficult, but he did.
3:22
SPEAKER_01: So when we came to this country, my grandfather had no language, and we all lived in a two-bedroom apartment.
3:29
SPEAKER_01: And at that time, I realized that I, around six years old, named Igor, I couldn't keep up with the peers, right?
3:37
SPEAKER_01: Like we didn't have the money, my parents had to learn the language.
3:39
SPEAKER_01: My grandfather went back to being a tailor.
3:42
SPEAKER_01: That was his original career from Steddels back in the day.
3:47
SPEAKER_01: So at around six, seven, when I didn't couldn't keep up with the peers in school, couldn't have the money, was teased for my name being Igor.
3:56
SPEAKER_01: No one came to my birthday party when I was seven.
3:59
SPEAKER_01: When my parents finally got enough money to buy me some pizza, that's when my hustle started.
4:05
SPEAKER_01: So I don't know what it was.
4:07
SPEAKER_01: Yeah.
4:07
SPEAKER_02: But you got the chip on your shoulder early.
4:10
SPEAKER_01: I I got the chip on my shoulder.
4:12
SPEAKER_01: I've done the work, trace it back, and you know, from that moment on, I made sure my birthdays were always full, people were always around me, and things of that nature.
4:23
SPEAKER_01: Now, I don't uh people ask me sometimes about that, or they probably ask you as well.
4:27
SPEAKER_01: Like, are entrepreneurs made?
4:29
SPEAKER_01: Are they born?
4:30
SPEAKER_01: Because that was my first major, let's call it, you know, failure.
4:34
SPEAKER_01: No one showed up.
4:35
SPEAKER_01: My name was Igor.
4:36
SPEAKER_01: My dad changed my name to Jerry.
4:38
SPEAKER_01: Why?
4:38
SPEAKER_01: Because the president, Gerald Ford, was the president, so he's like, okay, we're gonna make him the president.
4:44
SPEAKER_01: And my mindset all of a sudden shifted into, which is really an insecurity that I couldn't have friends, anybody show up to my birthdays, is what am I gonna do to fill that gap?
4:54
SPEAKER_01: And I went full force, right?
4:56
SPEAKER_01: Opposed to others, shut down, get depressed, become a recluse, right, or they quit.
5:03
SPEAKER_01: So that led into me being, you know, the class clown by you know, eighth grade, seventh grade, all that kind of stuff.
5:10
SPEAKER_01: We moved into an apartment.
5:12
SPEAKER_01: My dad finally got a job working in um in Detroit with General Motors.
5:15
SPEAKER_01: That was New York at that time.
5:16
SPEAKER_01: So we went there.
5:18
SPEAKER_01: We rented an apartment in a very well-off community, but we were still the poor people.
5:22
SPEAKER_01: But that's where it started.
5:24
SPEAKER_01: Like just the class clown, getting the attention, you know, organizing parties.
5:29
SPEAKER_01: Uh in seventh grade, I threw a keg party, right?
5:32
SPEAKER_01: Charged, things like that.
5:33
SPEAKER_01: Believe it or not, I remember this kid lived in my apartment building and he had marijuana, right?
5:39
SPEAKER_01: So we rolled joints and we went to the seventh grade dance and I sold them for a dollar, right?
5:43
SPEAKER_01: But I didn't use them.
5:45
SPEAKER_01: Good economics, good economics.
5:47
SPEAKER_01: Right.
5:47
SPEAKER_01: We were breaking it down.
5:49
SPEAKER_01: And then in high school, I started valet parking, cash, all of those hustles, right?
5:55
SPEAKER_01: That were just everyone knew.
5:57
SPEAKER_01: It got to a point where I, you know, and I'll share this today, I don't care.
6:02
SPEAKER_01: Um, is by my senior year, I mean the teachers hated me, the principals hated me, but all the people at the school loved me because no one went out on the weekend without touching base with me, whether you were uh, you know, a snobby preppy kid, a jock, or a burnout.
6:18
SPEAKER_01: That's what we had back then, right?
6:19
SPEAKER_01: We were always friends.
6:21
SPEAKER_01: And there was one point where I used to have a backpack and I was selling blowpops, but that shifted to uh an eighth of an ounce of weed in uh MM chocolate, and the peanut was a quarter ounce, right?
6:34
SPEAKER_01: And and everyone got wind.
6:36
SPEAKER_01: The teachers, the this, and then my mother couldn't believe I graduated high school.
6:40
SPEAKER_01: My father tried to put me in jail a couple times.
6:43
SPEAKER_01: No, but he was he was really tough on me.
6:46
SPEAKER_01: Made me, you know, come up with you want to buy a car?
6:48
SPEAKER_01: I had to match two grand to come up with a car.
6:50
SPEAKER_01: Everything was matched.
6:51
SPEAKER_01: I had to sign a contract with my father, and nothing I did was good enough with him ever.
6:55
SPEAKER_01: And then in my graduation, they wouldn't even let me walk.
6:58
SPEAKER_01: My senior and my mom had to beg and plead because they thought I was gonna pull a stunt, right?
7:02
SPEAKER_02: So did you did you pull a stunt?
7:05
SPEAKER_02: Did you did you go through?
7:06
SPEAKER_01: I promised my mother I wouldn't, so I didn't do it, and they let me walk at graduation, but at that point, I had 82 points on my driver's license.
7:17
SPEAKER_01: Okay, and I don't know why, because I lived in a suburb called West Bloomfield, Michigan, and the principal knew the police people.
7:25
SPEAKER_01: This one, they would pull me over because she said I was always selling pot and doing all these things.
7:29
SPEAKER_01: And every time I would get a ticket, my father would take my car.
7:32
SPEAKER_01: I had to tell you it was Supra, 1984.
7:34
SPEAKER_01: Um, and he would get pulled over.
7:36
SPEAKER_01: Nice car.
7:37
SPEAKER_01: Nice car Supra.
7:39
SPEAKER_01: My dad, I was selling shoes, working for his women's shoes at 15, working for his friend's daughter or something like that.
7:48
SPEAKER_01: I found out women commission sales on a Saturday at this place called Tally Hall.
7:53
SPEAKER_01: So that was the beginning of my hustle, but that led to my mother looking at my father when it was time to go to college.
7:59
SPEAKER_01: I could barely, I was a straight A student, straight C student, right?
8:03
SPEAKER_01: Because I didn't care.
8:04
SPEAKER_01: C was my grade in everything because it kept me there.
8:08
SPEAKER_01: I always knew how to stay there.
8:09
SPEAKER_01: Uh they said hey, we got to get him out of Michigan because otherwise he's gonna be in trouble, right?
8:13
SPEAKER_01: It was just too small, and that's how I found myself in Miami.
8:17
SPEAKER_02: And um so they decided Miami was a better alternative to Michigan, and there's gonna be no trouble in Miami, right?
8:25
SPEAKER_01: Yeah, that didn't work out too well.
8:28
SPEAKER_01: Um, because I got a little crazy and I went to, you know, I was down by the University of Miami, Dave Community College, trying to get the University of Miami, and then my first I was in the dorms because they had a program with the University of Miami back then, and I threw a tech party and I got thrown out of there.
8:44
SPEAKER_01: So the best thing that happened to me is it was a school called Northwood University.
8:48
SPEAKER_01: It's based in Midland, Michigan, and I knew about it because they they did automotive marketing.
8:54
SPEAKER_01: So when you're in Michigan, it's a you know, like the internet is into Silicon Valley, Detroit, uh to automotive, right?
9:01
SPEAKER_01: So it was an automotive marketing school, which meant it was kids of dealerships that learned how to run sales departments, dealerships.
9:08
SPEAKER_01: So they happened to open a West Palm Beach branch.
9:11
SPEAKER_01: And then I ended up in West Palm, and it was the best thing that happened because I had a professor, Mr.
9:18
SPEAKER_01: Smith, God bless his soul.
9:19
SPEAKER_01: Um, he was my sales teacher, right?
9:22
SPEAKER_01: It was 15 people in a class, an apartment.
9:25
SPEAKER_01: I was doing all the same crazy stuff still, t-shirts, bong parties, all that stuff.
9:30
SPEAKER_01: And um, he kept giving me a hard time, this guy.
9:33
SPEAKER_01: Always giving me a hard time.
9:34
SPEAKER_01: He's like, Cats, what's up with you?
9:36
SPEAKER_01: What are you getting on this test?
9:38
SPEAKER_01: I go, C plus, C plus, right?
9:41
SPEAKER_01: And one day he took me to Jack Collie Chevrolet in on Okechobe, West Palm.
9:46
SPEAKER_01: He made me go for the day, and I watched him in sales and I did all that, and he shifted me.
9:51
SPEAKER_01: He told me two things that day that I remember to this day.
9:54
SPEAKER_01: He said, first thing, he goes, don't make the mistake that I made.
9:58
SPEAKER_01: He goes, You're a hustler, you're a talker, you're a sales guy.
10:02
SPEAKER_01: He goes, I went to work for at that time it was bought by Auto Nation.
10:05
SPEAKER_01: For Auto Nation, it was a corporate job.
10:08
SPEAKER_01: I got benefits, I got a six-figure salary, I got stock, I got kids, I got health insurance.
10:14
SPEAKER_01: And he says, but if you stay where I stay, you'll never make it big in life.
10:19
SPEAKER_01: Never.
10:20
SPEAKER_01: So he called them the golden handcuffs, right?
10:22
SPEAKER_01: Of Auto Nation.
10:23
SPEAKER_01: So he told me that.
10:24
SPEAKER_01: And then the second most important thing he told me was what's the real decision of your life is that's your spouse.
10:31
SPEAKER_01: And he goes, Your spouse will make you or break you.
10:35
SPEAKER_01: So that that began my my journey.
10:40
SPEAKER_01: Um, and he actually turned turned my turned I don't know, turned me around, and I started listening in school, sales courses, accounting courses, marketing courses, right?
10:50
SPEAKER_01: All of a sudden I became interested.
10:51
SPEAKER_01: Oh my god, I could scale this t-shirt business, right?
10:56
SPEAKER_01: Or, but my buddy went to the University of Arizona.
10:59
SPEAKER_01: I go, he should be selling me pounds.
11:00
SPEAKER_01: It's cheap because it's close to Mexico, right?
11:05
SPEAKER_00: Listen, how many people do we know in entrepreneurs' organization that have a similar story, right?
11:11
SPEAKER_02: Very similar.
11:12
SPEAKER_02: I I have a very similar story to yours.
11:14
SPEAKER_02: But but how did how did you fall on insurance?
11:17
SPEAKER_02: Was it always insurance?
11:18
SPEAKER_02: Or was there other businesses before that?
11:21
SPEAKER_01: Yeah, there was it was so right out of college, I knew I was gonna go into sales, and at that time it's when they broke ATT, so divestiture.
11:29
SPEAKER_01: So um, with him as a mentor, Mr.
11:32
SPEAKER_01: Smith, he said, find a sales job where they have crazy sales training, learn the skills, and what have I learned today?
11:39
SPEAKER_01: Is you're only as good as your skill sets, right?
11:42
SPEAKER_01: If you don't learn skill sets and if you don't take the time to learn a sales course or whatever you know, skill set that you need to do, but he always said sales is the best skill set for entrepreneurship.
11:53
SPEAKER_01: So I went to work for a company called Allnet Communications, and the other part with that he taught showed me was don't go to work for Xerox.
12:01
SPEAKER_01: Like back then it was Xerox because the sales cycles were too long, or don't sell cars because you're only as good as every month you're at zero and you're negotiating.
12:11
SPEAKER_02: There's no residual income, no residual income.
12:13
SPEAKER_02: You're starting from scratch and you gotta continue to build your book.
12:17
SPEAKER_01: Exactly.
12:18
SPEAKER_01: Continue to do it and so on.
12:19
SPEAKER_01: So I went for all net communications where I basically would walk in, cold call, and just ask for the person, you know, hi, this is Jerry.
12:26
SPEAKER_01: Can I speak to the person that handles your communication decisions here?
12:29
SPEAKER_01: Oh, that's the owner.
12:30
SPEAKER_01: Okay, great.
12:30
SPEAKER_01: Tell them I'm here, please.
12:31
SPEAKER_01: Right?
12:32
SPEAKER_01: Oh, well, do you have an appointment?
12:33
SPEAKER_01: That's exactly why I came here today.
12:35
SPEAKER_01: Um, and what I would do, like, right, is get their phone bill.
12:39
SPEAKER_01: And if their phone bill was$1,400, I would sign them up for almond, I would cover cut it to$700, and then I'd have 12 months of residual commissions and income and do that.
12:48
SPEAKER_01: So that was my first sales job, and I did that in uh Florida, and then I became one of the best sales guys, real hardcore sales coaching every morning.
12:59
SPEAKER_01: Role playing, good, they they had a really good team, you know, and it was an easy sales cycle as long as you want, didn't mind cold calling, knocking on doors, and role playing and all that.
13:10
SPEAKER_01: And then eventually people burn out down the road, but I didn't.
13:13
SPEAKER_01: But what happened to me was there's something interesting is I went to high school in Michigan with a guy named Mike Raskin.
13:19
SPEAKER_01: And those guys went to Arizona, I went to Florida, and all of a sudden, Mike says he's coming to town.
13:26
SPEAKER_01: I said, I'm living in West Palm at that time, and he comes in and he pulls up in a red Ferrari, and this kid's 22 years old, right?
13:34
SPEAKER_01: 22, 23 at the time.
13:36
SPEAKER_01: And I go, What are you doing?
13:37
SPEAKER_01: He goes, Hey, all my buddies that I went to the University of Arizona with, they all work on Wall Street, right?
13:43
SPEAKER_01: Because they have the big New York party school.
13:46
SPEAKER_01: And I go, Really?
13:47
SPEAKER_01: He goes, Where do you work?
13:48
SPEAKER_01: He goes, I work at a place called Stratton, Oakmont with a guy named Jordan Belford, right?
13:53
SPEAKER_01: I go, really?
13:54
SPEAKER_01: He goes, Yeah, starts showing me this, this.
13:57
SPEAKER_01: Four weeks later, I moved to New York because I was in shack and I interviewed with the Wolf of Wall Street, Jordan Belford, all these guys.
14:07
SPEAKER_01: I didn't know any better, right?
14:09
SPEAKER_01: You don't know any better.
14:10
SPEAKER_01: And boom, I got the job.
14:12
SPEAKER_01: I got on the phones, I started working it.
14:14
SPEAKER_01: I remember my first account at 10 p.m.
14:16
SPEAKER_01: 10 p.m.
14:17
SPEAKER_01: 10 p.m.
14:18
SPEAKER_01: at night, Dr.
14:19
SPEAKER_01: Bloomgarden, and they cut your tie when you pop your cherry and you open your first account.
14:24
SPEAKER_02: I worked on Wall Street when I was I was 15.
14:26
SPEAKER_02: I I remember the cutting of the tie.
14:28
SPEAKER_02: Pop, pop, popping your cherry is what they used to call it.
14:31
SPEAKER_01: That's right.
14:32
SPEAKER_01: Where did you work?
14:33
SPEAKER_01: And so forth.
14:35
SPEAKER_02: I worked at uh another top shop.
14:37
SPEAKER_02: I won't name the name, but uh I was there for like two months.
14:41
SPEAKER_01: Right.
14:42
SPEAKER_01: So that's what happened to me is I was out in Lake Success, Long Island, and I wanted to live in the city, right?
14:48
SPEAKER_01: So after four months, but what did they teach me?
14:51
SPEAKER_01: They taught me to high call high net worth individuals and ask for you know$100,000 and get 10, right?
14:58
SPEAKER_01: You learned what a Piker is, you learn not to be a midget, you learned, you know, and then my first paycheck, Joe Jordan Belford, walked me right into Tornot and made I had a$9,000 commission check on the fourth month that I was there.
15:10
SPEAKER_01: And he walked me right into Tornot and made me drop$8,700 on a Rolex, right?
15:15
SPEAKER_01: And he said, if I didn't, I was fired.
15:20
SPEAKER_01: So you know what they used to say.
15:21
SPEAKER_01: He goes, he used to call me the heat, the heat miser, because I could bring the heat on the phone.
15:26
SPEAKER_01: And he used to say, Jerry, how do you turn you know a piece of coal into a diamond with pressure?
15:32
SPEAKER_01: I go, I'll be broke.
15:34
SPEAKER_01: My rent's eighteen hundred dollars a month.
15:36
SPEAKER_01: But even back then, right, I had a roommate and I was eating spaghetti with ketchup for it was nuts.
15:42
SPEAKER_01: But eventually I ended up leaving going into the city after four or five months, and I ended up at Gruntel, GKN, and then I was at Lehman for two years, which was worse than all of them, right?
15:55
SPEAKER_01: We learned how to never give up.
15:57
SPEAKER_01: We learned how to overcome objections, rebuttals.
16:01
SPEAKER_01: And listen, if if we used to work from if you were there 8:30 to 4, 4, we go downstairs, go to the gym, whatever, and then at six o'clock, we would work till 10.
16:10
SPEAKER_01: You claim the work ethic.
16:12
SPEAKER_01: Yeah.
16:12
SPEAKER_01: Yeah.
16:13
SPEAKER_02: I mean, my first job on Wall Street, I was 15, I was making 200 bucks a week.
16:18
SPEAKER_02: And uh I think it was the Mondays and Fridays, you worked nine to five, and then Tuesdays, Wednesdays, Thursdays, I think it was like until nine o'clock.
16:29
SPEAKER_02: But uh I'll tell you a funny story.
16:30
SPEAKER_02: My first day on Wall Street, uh, I had to be there, I think it was like nine or nine thirty, and I was 15 years old, right?
16:37
SPEAKER_02: So I I got there and I get to the door, and I'm trying to open the door.
16:42
SPEAKER_02: It was like 9.05.
16:43
SPEAKER_02: I was five minutes late, and and I'm trying to open the door, the door is locked.
16:47
SPEAKER_02: They weren't even getting there until like 10 o'clock because they were all out partying the night before.
16:53
SPEAKER_02: And then like the receptionist came and she's like, Who are you?
16:56
SPEAKER_02: Like my first day.
16:57
SPEAKER_02: She's like, Yeah, they'll come in at like 11 or whatever it was.
17:00
SPEAKER_00: But I I can tell you crazy stories about what I'm sure.
17:03
SPEAKER_02: I'm I'm yeah, I'm sure you can.
17:05
SPEAKER_02: So let's let's talk about.
17:07
SPEAKER_02: I mean, like just revisiting everything you talked about.
17:11
SPEAKER_02: You got this mentor, Mr.
17:12
SPEAKER_02: Smith, that was really able to kind of give you some really useful information and data, right?
17:18
SPEAKER_02: Don't go do long-term sales, right?
17:21
SPEAKER_02: Go find something that has residual income.
17:23
SPEAKER_02: Uh, your buddy, you know, showed you Wolf of Wall Street, which I I think is an amazing story, but but yeah, even that story about going to turn out and buying a Rolex, right?
17:33
SPEAKER_02: Yep.
17:34
SPEAKER_02: You you need you need to work harder, right?
17:37
SPEAKER_02: Like work harder next month, and you're gonna have you know double the amount of money.
17:41
SPEAKER_02: And that's what they used to do, right?
17:42
SPEAKER_02: They used that's why they had a Ferrari and they were living in a studio apartment or whatever it is.
17:47
SPEAKER_01: That's right.
17:47
SPEAKER_01: They didn't care.
17:48
SPEAKER_01: They said you would make it, you would make it, pile bills up, pile the bills.
17:52
SPEAKER_01: The pressure is what keeps driving you, you know, and some people crack.
17:57
SPEAKER_01: Like you know, if a hundred kids came in there, started working at the end of 12 months, it was six, seven.
18:04
SPEAKER_01: Maybe, yeah.
18:05
SPEAKER_01: Yeah, maybe because that's because you know, they either hung up on you or they bought, and that was it.
18:11
SPEAKER_01: And then you would ask for big money and you would talk to them with authority, right?
18:16
SPEAKER_01: With scripts and this, and so you learned.
18:18
SPEAKER_01: But just to sum up that is that was one of the best, I think, things that ever happened to me in life, meaning that I made a couple million bucks before I was 30, right?
18:28
SPEAKER_01: And that was during the dot-com bubble and crisis and all that kind of stuff.
18:32
SPEAKER_01: And the best thing about it is I really got a not only an education and sales, how to think big, how to not be a piker in their words, how I watched these guys raise a million dollars on a phone call and make$75,000 in commission and then blow it all weekend and then do it again on a Tuesday morning.
18:50
SPEAKER_01: Right.
18:50
SPEAKER_01: So I understood it was who was I was around that was bringing me up to these levels.
18:56
SPEAKER_01: And for me, I had to be the one that always had my birthday party full.
19:00
SPEAKER_01: So I was I was a competitor.
19:02
SPEAKER_01: I had to compete, I was relentless, I wouldn't go home like until I got those accounts.
19:08
SPEAKER_01: I and I worked my way up, you know, in those organizations, made a couple million dollars, had a bunch of$5,000 suits.
19:16
SPEAKER_01: I was forced to buy a Porsche, but the best thing I did was I bought a condo on the Upper East Side, right?
19:21
SPEAKER_01: At that time it was a one-one, 600 square feet.
19:23
SPEAKER_01: I think I paid$300,000.
19:25
SPEAKER_01: And then what else did we learn?
19:27
SPEAKER_01: Cycles, finance market, bond market.
19:30
SPEAKER_01: We would have Bloomberg on the time because you had to talk the talk of the money industry, right?
19:35
SPEAKER_01: You had to know what inflation was CPIs and bonds and the feds, and all of a sudden I learned what a bubble was.
19:43
SPEAKER_01: Why?
19:44
SPEAKER_01: Because within six weeks, I lost my entire book, right?
19:48
SPEAKER_01: AOL Time Warner destroyed that, the dot-com bubble destroyed that.
19:52
SPEAKER_01: And me myself, I was at uh that time I was at Raymond James, and I I had a$60,000 margin call.
19:59
SPEAKER_01: So I got caught up in the entire thing, and the best thing I had going for me was that condo because I called up the broker.
20:06
SPEAKER_01: I said, What's my condo worth?
20:08
SPEAKER_01: Right, because I literally lost everything in six weeks.
20:11
SPEAKER_01: And she said it's worth about$450.
20:13
SPEAKER_01: I'm like, thank God I had some equity, and I'm like, okay, and eventually, this is 2001.
20:18
SPEAKER_01: Now I sold it and I started over.
20:21
SPEAKER_01: I moved to Miami.
20:23
SPEAKER_01: But that learning experience on Wall Street, understanding the money business, understanding the economy, understanding greed and how the industry works, right?
20:33
SPEAKER_01: And what a cycle is, and you know, buy on rumors, sell on news, how retail and institutional totally different right?
20:43
SPEAKER_01: What's smart money, what's stupid money, um, all of that stuff.
20:47
SPEAKER_01: Plus, you realize that yes, Wall Street is the economic engine that raises capital, the IPOs and everything, but it's also a very greedy world.
20:57
SPEAKER_01: And what I and and yes, even like the Michael Milkins of the world, or like for example, the dot-com bubble, we were pitching web van.
21:06
SPEAKER_01: Web van, that stock, we took it public at$8, it went to 110, and I'm still using a 56k modem.
21:13
SPEAKER_01: So what you learned is, you know, that doesn't work today.
21:18
SPEAKER_01: It's Grubhub, right?
21:19
SPEAKER_01: But that went to zero.
21:21
SPEAKER_01: Because if you didn't have the technology, the iPhone, the capacity, acceleration, there was nothing.
21:27
SPEAKER_01: So we were 10 years ahead.
21:29
SPEAKER_01: But why were the valuations of the stocks going higher and higher and higher?
21:32
SPEAKER_01: Why?
21:33
SPEAKER_01: Because Wall Street was making a fortune.
21:35
SPEAKER_01: And it was also the birth of the internet, the dot com age.
21:39
SPEAKER_01: And today, yes, we have the Googles and we have, you know, the others are gone.
21:43
SPEAKER_01: So 10% remain, and today we have the Magnificent 7 because of that industry.
21:47
SPEAKER_01: So the the learning point there is where's the bubble today, right?
21:52
SPEAKER_01: Because then the next bubble was crypto, right?
21:54
SPEAKER_01: Or I'm sorry, the GFC in 2006, 7, 8.
21:57
SPEAKER_01: They took, because that got regulated, the NASDAQ.
22:00
SPEAKER_01: Deck and dot coms, and you couldn't make 5% commissions anymore.
22:03
SPEAKER_01: So they went to mortgages, right?
22:06
SPEAKER_01: That caused the uh a huge real estate bubble and the global financial crisis.
22:10
SPEAKER_01: And then most recent, it was the crypto bubble.
22:13
SPEAKER_01: And today we're probably sitting on one of the biggest bubbles I've ever seen in my life, which is the AI bubble.
22:18
SPEAKER_01: Now, well, AI changed the world.
22:21
SPEAKER_01: Yeah.
22:21
SPEAKER_01: Did dot com change the world?
22:23
SPEAKER_01: Yeah.
22:24
SPEAKER_01: But it's the valuations, right?
22:26
SPEAKER_01: Because you start getting stupid saying, FOMO, you know, can I get in?
22:31
SPEAKER_01: How high will these go?
22:32
SPEAKER_01: But AI, which people don't realize, is probably five to seven years away.
22:36
SPEAKER_01: What we're doing now is playing with Buena Vista and Yahoo and search engines and we got mail, right?
22:43
SPEAKER_01: But all that's gone.
22:44
SPEAKER_01: So you really learned, I learned about that.
22:48
SPEAKER_02: But that's that that's a that's a good lesson to learn in such a young age.
22:53
SPEAKER_02: Let me, I mean, one thing we talk about on the show a lot is is failures, right?
22:58
SPEAKER_02: You have to fail in order to succeed.
23:02
SPEAKER_02: You have to fail multiple times.
23:04
SPEAKER_02: And you know, I think most people that don't want to become entrepreneurs or scared to become entrepreneurs, it's because they're afraid to fail, right?
23:13
SPEAKER_02: And really what you need is to fail in order for you to say, well, that wasn't that bad, right?
23:19
SPEAKER_02: You rip off the band-aid and you're like, let's keep it going and start the next thing.
23:23
SPEAKER_01: Listen, today I can I could proudly say the more mistakes I make, the more I learn.
23:29
SPEAKER_01: But back then, failure was right.
23:31
SPEAKER_01: The first failure was no one came to my birthday party.
23:34
SPEAKER_01: Nobody came to your birthday party.
23:35
SPEAKER_02: So think about but think about how that shaped you, even you just describing yourself, right?
23:41
SPEAKER_02: That is literally part of your DNA, is you need to make sure everybody's at your birthday party.
23:47
SPEAKER_02: You need to go work harder, right?
23:48
SPEAKER_02: You need to go continue to push.
23:50
SPEAKER_02: I mean, correct.
23:51
SPEAKER_02: That that's a lot.
23:52
SPEAKER_02: I'm gonna bring this back.
23:54
SPEAKER_02: How did you get into insurance into the wonderful world of insurance from there?
23:58
SPEAKER_01: Right.
23:58
SPEAKER_01: So into the world of insurance.
24:00
SPEAKER_01: So at that point, I had one client, his name was Ben Shulman, Tiger Shulman Karate.
24:04
SPEAKER_01: He was an investor with me at Raymond, and him and I both had Harleys in the city, and we became friends.
24:09
SPEAKER_01: So he lost a lot of money in the market too, but I was his broker, but he was diversified.
24:14
SPEAKER_01: He had real estate, he had trailer parks, he had uh Tiger Shulman karate, he scaled that thing.
24:18
SPEAKER_01: So he taught me how to buy multifamily.
24:20
SPEAKER_01: So when I was broke and dead, it's another big lesson.
24:24
SPEAKER_01: Mentors, right?
24:25
SPEAKER_01: What he said to me, he goes, two things.
24:27
SPEAKER_01: He goes, number one, he goes, You want to know what the problem is with being a broker on Wall Street?
24:31
SPEAKER_01: What?
24:31
SPEAKER_01: He goes, You're in it for you.
24:33
SPEAKER_01: He goes, it doesn't work with the laws of the universe, it doesn't create a win-win situation.
24:38
SPEAKER_01: You're so focused on commission and making money for you.
24:40
SPEAKER_01: What are you really providing?
24:42
SPEAKER_01: And that's why the bubble came, it doesn't work that way.
24:45
SPEAKER_01: Real business, you focus on providing solutions, solving problems, and then the money comes.
24:51
SPEAKER_01: Where that world is money, greed, greed, and that is another bigger pit for me, you know, about how the universe works.
24:58
SPEAKER_01: And where he explained, like, if I breathe out carbon monoxide, that tree gives me oxygen.
25:04
SPEAKER_01: The universe works that way.
25:06
SPEAKER_01: So what I was doing was all about me.
25:08
SPEAKER_01: So it was eventually it was gonna blow up.
25:10
SPEAKER_01: And if you take that to an extreme, you're a criminal, right?
25:14
SPEAKER_01: So he was explaining that, and then number, yeah, that's which he was a smart guy.
25:19
SPEAKER_01: Again, mentorship.
25:21
SPEAKER_01: And I go, I get it.
25:22
SPEAKER_01: So it's not about making money.
25:23
SPEAKER_01: No, he says business is about solving people's problems, and the bigger problem that you solve, right?
25:29
SPEAKER_01: The more money you make, the more money you make.
25:32
SPEAKER_01: So he said, Go to Florida, I'll mentor you.
25:35
SPEAKER_01: Let's buy multifamily.
25:37
SPEAKER_01: So I moved to Florida in 2003, Miami Beach.
25:39
SPEAKER_01: He believed in migration patterns.
25:41
SPEAKER_01: He gave me a book called uh Katie Popcorn, Popcorn Report.
25:45
SPEAKER_01: She goes to predict what's going to happen with people migration and trends in the future.
25:50
SPEAKER_01: She's still around today.
25:51
SPEAKER_01: And he predicted that Florida would boom because of retirees and the snowbirds and politics, and he was right.
25:58
SPEAKER_01: So by 2005, with his help, hard lenders hustling, started over with maybe 80 or 90 grand again.
26:06
SPEAKER_01: Um, I started buying real estate.
26:08
SPEAKER_01: I got up to around 144 units in 2005.
26:12
SPEAKER_01: I had another partner that were two local realtors in Miami.
26:16
SPEAKER_01: They were my seniors, like in their 60s, because they saw me, I was the hustler.
26:20
SPEAKER_01: And they, this is before MLS, Zillow, all that.
26:23
SPEAKER_01: They had the buyers and sellers.
26:25
SPEAKER_01: I was the value ad guy doing all the work, prepping it.
26:29
SPEAKER_01: And we ended up with investors realty, old Florida Mortgage, and I had around 240 units in 2005, all multifamily value ads.
26:38
SPEAKER_01: And a lot of it was fix and flip 1031 because I was building equity.
26:42
SPEAKER_01: That cash-flowing real estate, it wasn't enough, right?
26:46
SPEAKER_01: I had to buy$150,000 forplex, get$20K in Home Depot credit cards, fix it up,$170,000, and then they would sell it for$200.
26:55
SPEAKER_01: But my 30 or 40 would turn to$60, right?
26:58
SPEAKER_01: And then keep going.
26:59
SPEAKER_01: So we got up to those units.
27:02
SPEAKER_01: We had one building was 140 units.
27:04
SPEAKER_01: And I mean, let's like an assemblage in 1967.
27:09
SPEAKER_01: Which part?
27:10
SPEAKER_01: South Beach.
27:10
SPEAKER_01: South Beach.
27:11
SPEAKER_01: Art Deco, right?
27:13
SPEAKER_01: Just above fifth.
27:14
SPEAKER_01: And um it was about 140 units total in that area.
27:18
SPEAKER_01: And I had a non-recourse Fanny Freddy loan because they were easy to qualify.
27:22
SPEAKER_01: And my insurance was around 800 a unit.
27:24
SPEAKER_01: Wilma comes through in 2005, no claims, no real damage, nothing goes off.
27:32
SPEAKER_01: November comes around.
27:33
SPEAKER_01: In November, I'm calling my brown and brown guy and saying, hey, where's my renewal?
27:36
SPEAKER_01: Where's my renewal?
27:37
SPEAKER_01: Where's my renewal?
27:39
SPEAKER_01: 72 hours prior to my renewal, sends me it.
27:42
SPEAKER_01: It goes from 800 to 1800 a unit,$1,000 a door,$144,000 increase with 72 hours notice.
27:50
SPEAKER_01: And I'm like, are you out of your mind?
27:52
SPEAKER_01: Well, Jerry, you have a bank and I can't meet the deductibles at 10%.
27:56
SPEAKER_01: And this, you got to buy it, you got to buy it.
27:58
SPEAKER_01: What he doesn't understand, and the industry doesn't understand in insurance, is when that happens, you take$150,000 of net operating income out of my property, there's no point in owning it.
28:11
SPEAKER_01: Insurance, I mean, real estate's a commodity.
28:14
SPEAKER_01: So for every$100,000 of NOI you lose because of increased insurance, you're losing$1.8 million in enterprise value.
28:22
SPEAKER_01: Or if you're cash out refined to today's rate in terms, you're losing over a million dollars in there.
28:28
SPEAKER_01: So that's what he just destroyed in my EBITA, in my NOI.
28:32
SPEAKER_01: So at that point, I was like, no way.
28:34
SPEAKER_01: So I grabbed this kid, Doug Levy.
28:37
SPEAKER_01: He was an insurance guy at Allstate, and I said, let's open an insurance agency because this can't happen to me because I was barely above water on those units.
28:45
SPEAKER_01: So I did that for the commission purposes and to get control.
28:49
SPEAKER_01: What I ended up realizing down the road is it's way more than that.
28:54
SPEAKER_01: And how the works.
28:57
SPEAKER_02: Can I guess what you realized?
28:59
SPEAKER_02: Whatever what Mr What Mr.
29:01
SPEAKER_02: Smith has taught you.
29:02
SPEAKER_02: Residual income, right?
29:05
SPEAKER_02: Am I hitting it on the head there?
29:07
SPEAKER_01: On the money, right?
29:09
SPEAKER_01: Residual income.
29:10
SPEAKER_01: Residual income.
29:11
SPEAKER_01: And by the way, guys, the ENS markets, which is what what we operate in high-risk coastal states, is completely unregulated.
29:19
SPEAKER_01: It's completely almost, it's it's regulated, but it's not, it's like the old Wall Street days.
29:25
SPEAKER_01: Whatever they want to price your policy at, they can price the policy based on the market.
29:30
SPEAKER_01: Where there's something called admitted carriers, no, they have to get state approval and then they have to do fixed pricing and they submit their coverages and the pricing and they're locked and you don't pay sales tax.
29:40
SPEAKER_01: But in a hurricane state, high-risk coastal states, not only Florida, which now there's like 15 to 17 of them that is ES markets.
29:49
SPEAKER_01: If you need insurance carriers to come in, they they can do whatever they want.
29:54
SPEAKER_01: They don't even need financial stability, they can do whatever pricing they want.
29:58
SPEAKER_01: So that's what I learned.
30:00
SPEAKER_01: So we took it vertical for the insurance business, but later, like so today, um, Doug eventually left.
30:09
SPEAKER_01: He married a Peruvian girl, and then five years ago, maybe six years ago now, I took over the insurance piece.
30:14
SPEAKER_01: Why?
30:15
SPEAKER_01: Because we we had around a million and a half in revenue, which is about 15 million in premium.
30:20
SPEAKER_01: Most of that was that's when I was introduced to entrepreneurs organization, which changed my life.
30:26
SPEAKER_01: Gorin, who was one of my competitors in real estate, introduced me.
30:29
SPEAKER_01: We had lunch, my competitor brought me into EO.
30:31
SPEAKER_01: I eventually went on the scaling thing and the values thing, and I've been to every Tony Robbins course, and you name it.
30:38
SPEAKER_01: You drank the Kool-Aid.
30:40
SPEAKER_01: I drank the Kool-Aid and I surrounded myself with a group of entrepreneurs that engage each other to learn and grow and help each other with value systems, integrity, and that's who I am today.
30:52
SPEAKER_01: So, because of all that, I realized that that's how you scale with integrity, right?
30:57
SPEAKER_01: And solving problems.
30:59
SPEAKER_01: So, five, six years ago of this whole journey, I said, okay, Doug's leaving.
31:06
SPEAKER_01: I still was buying real estate.
31:07
SPEAKER_01: And at one point we had a$30 million equity exit with those partners, and we I closed investors realty, Old Florida Mortgage, and I thought I was gonna chill out for a little while, and then that changed, and I went down to uh Costa Rica, Panama, Colombia, started scaling small hotels, but I was back, right?
31:26
SPEAKER_01: So I continued to buy real estate after those exits, went back into it, and then when Doug finally left in insurance five years ago, I said, wait a minute, we only got a million and a half in premium.
31:36
SPEAKER_01: Now I understand the industry.
31:38
SPEAKER_01: I'm doing it for all my EO brothers, right?
31:41
SPEAKER_01: I'm doing it right for them.
31:43
SPEAKER_01: And I realized that we can disrupt the entire insurance space, and that's why I did it.
31:48
SPEAKER_01: And today we insured around five billion dollars worth of commercial real estate in 15 states, and our what we do for people is a copyright.
31:58
SPEAKER_01: We I copyrote it, it's called total asset optimization.
32:02
SPEAKER_01: So what that what total asset optimization is, is we look at insurance from the point of a real estate investor.
32:10
SPEAKER_01: So 90% of our clients are real estate investors, and we say to everybody, you don't need to increase your portfolio by buying more properties or property value.
32:20
SPEAKER_01: We lower your insurance expenses.
32:23
SPEAKER_01: And the industry doesn't understand that.
32:26
SPEAKER_01: We talk NOI, net operating income, cap rates, EBA.
32:30
SPEAKER_01: They talk commissions and buy more coverage.
32:34
SPEAKER_01: 90% of insurance is unnecessary.
32:37
SPEAKER_01: And number two, most entrepreneurs, real estate operators, and real entrepreneurs like yourself, we can't even make claims.
32:45
SPEAKER_01: Because if we make a claim and we get a payout of 50,000, 30,000 or whatever, guess what happens to our insurance next year?
32:53
SPEAKER_01: Shoots through the roof.
32:54
SPEAKER_01: That's right.
32:55
SPEAKER_01: So what you're doing is destroying our enterprise value.
33:00
SPEAKER_01: So our recurring revenue, which is apartment buildings, all real estate is recurring revenue, all insurance is recurring revenue.
33:08
SPEAKER_01: But so all of a sudden, the valuation of Premier Protection Insurance, my insurance, is now larger than my real estate portfolio just because of the message.
33:19
SPEAKER_01: So when I now I'm a national speaker, I launched a brand called Jerry Katz CEO.
33:23
SPEAKER_01: It's a personal brand, real estate profit boost, where I interview$100 million people.
33:27
SPEAKER_01: I'm a national speaker at a real estate conference.
33:30
SPEAKER_01: I stand up, I say, who in the room likes insurance?
33:33
SPEAKER_01: Not one hand goes up, 400 investors.
33:36
SPEAKER_01: Not one.
33:36
SPEAKER_01: Maybe one or two.
33:37
SPEAKER_01: You know who does?
33:38
SPEAKER_01: The guy who had a total loss.
33:40
SPEAKER_01: Okay?
33:41
SPEAKER_01: Because that's when you need insurance.
33:44
SPEAKER_01: But the bottom line is no one knows how to fix that problem.
33:48
SPEAKER_01: No operators attack it.
33:50
SPEAKER_01: Now, you and I can attack our utility expense, we can attack payroll expenses, we can build a tech stack and automation, we can eliminate jobs, HR, this.
34:00
SPEAKER_01: But when it comes to insurance, here's how it goes.
34:03
SPEAKER_01: If you want to borrow money in real estate or SBA for entrepreneurship, guess what?
34:08
SPEAKER_01: You got to have these 27 insurance policies.
34:11
SPEAKER_01: And by the way, 24 of them you'll never need or you'll ever use.
34:15
SPEAKER_01: Because the last time I checked, you don't need domestic terrorism, because that's what they require when you do it on real estate.
34:21
SPEAKER_01: You don't need full value flood on an eight-story building for$70 million.
34:26
SPEAKER_01: You don't need any of it because the industry is based on forms.
34:29
SPEAKER_01: And what happens is if you borrow our money from the banks in the back end, who do you think funds the insurance syndicates?
34:37
SPEAKER_01: The banks.
34:38
SPEAKER_01: So it's a big money grab.
34:40
SPEAKER_01: And that's now I'm not saying that it's not necessary, but for example, this total asset optimization is different.
34:48
SPEAKER_01: Meaning I own these two retail buildings, right?
34:51
SPEAKER_01: It's my office, it's uh 150 feet on Federal Highway.
34:54
SPEAKER_01: I bought this dirt for$2.3 million four years ago.
34:58
SPEAKER_01: I raised the rents to$55 a foot.
35:00
SPEAKER_01: They changed the zoning in downtown Fort Lauderdale.
35:02
SPEAKER_01: My land is worth six.
35:04
SPEAKER_01: I have no risk here if these buildings blow down.
35:07
SPEAKER_01: They're 1957 concrete.
35:09
SPEAKER_01: I renovated the buildings, I lease them, and then I approached a credit union.
35:13
SPEAKER_01: I approached alternative lenders that will wave the wind.
35:16
SPEAKER_01: They'll waive all the BS, the law and ordinance, all the stuff that I don't need.
35:21
SPEAKER_01: And by the way, no entrepreneurs or operators understand what I'm saying.
35:25
unknown: Right.
35:26
SPEAKER_01: They just say, okay, that's it.
35:28
SPEAKER_02: Because they're just, they're just fill, they're checking a box, right?
35:30
SPEAKER_02: They're they're filling the form.
35:32
SPEAKER_01: They're checking out a box.
35:33
SPEAKER_01: So where my neighbor is paying almost the same properties over there,$41,000 a year in insurance and passing along to his tenant and he's got a vacancy.
35:43
SPEAKER_01: My insurance is$2,600 a year.
35:46
SPEAKER_01: I have liability because that's a real problem.
35:48
SPEAKER_01: I want lawsuit protection.
35:49
SPEAKER_01: I want slipping paws.
35:51
SPEAKER_01: But I don't need flood, wind, and hurricane.
35:53
SPEAKER_01: If this 5,000 square foot building blows over, good.
35:56
SPEAKER_01: I'll double my money on the land.
35:58
SPEAKER_01: So that's total asset optimization because we're risk takers and entrepreneurs.
36:02
SPEAKER_01: The other part of it, I'll even show you in entrepreneurship.
36:05
SPEAKER_01: So we have a mutual friend who sells dog beds online, right?
36:10
SPEAKER_01: And these are the big boys, the brown, and I don't want to put them down, but these are the big companies because private equity rolled up all the insurance agencies in the freaking country.
36:18
SPEAKER_01: They call me every day to buy, right?
36:20
SPEAKER_01: And private equity is both, what are they focused on?
36:24
SPEAKER_01: Profit, right?
36:25
SPEAKER_01: Returns, commission.
36:27
SPEAKER_02: Because they gotta they gotta flip it, they gotta flip it themselves.
36:30
SPEAKER_01: That's right.
36:31
SPEAKER_01: So, for example, we have a friend of ours who owns real estate and he owns a dog bed company.
36:38
SPEAKER_01: They sell$30 million worth of dog beds.
36:40
SPEAKER_01: They're the foam mattress, really nice animal prints.
36:44
SPEAKER_01: They're about$200 a piece.
36:45
SPEAKER_01: So he sends me over because he's got to go on Amazon.
36:48
SPEAKER_01: They want$5 million in general liability.
36:50
SPEAKER_01: He goes, Jerry, I heard you know you can help me with this.
36:53
SPEAKER_01: So he's an EO guy, sends it over to me.
36:56
SPEAKER_01: I look at the forms, he's classified as a pet supply company.
37:00
SPEAKER_01: Pet supplies, which is an encompassing of pet meds, right?
37:06
SPEAKER_01: 50 different companies.
37:07
SPEAKER_01: So what do I do?
37:08
SPEAKER_01: I look at him, I go, you a pet supply company?
37:11
SPEAKER_01: No, one product, dog bed.
37:13
SPEAKER_01: So what do I do?
37:14
SPEAKER_01: I called our underwriters, I said, Hey, I need you to classify this as a textile, a shirt.
37:20
SPEAKER_01: It's what it is.
37:21
SPEAKER_01: Guess what?
37:21
SPEAKER_01: They agreed because they wanted to take it from the competition.
37:24
SPEAKER_01: 30 million a liability.
37:26
SPEAKER_01: He was paying almost$80,000 from Zebron and another company's quotes.
37:31
SPEAKER_01: You know what it was for a textile?
37:33
SPEAKER_01: 11 grand.
37:35
SPEAKER_01: Right?
37:36
SPEAKER_01: Because of the classification.
37:38
SPEAKER_01: But you and me as entrepreneurs, who knows this stuff?
37:42
SPEAKER_01: And why is nobody we know in the insurance industry?
37:44
SPEAKER_01: Because it's got a bad reputation.
37:47
SPEAKER_02: So so, question for you, and and I think you hit on something.
37:50
SPEAKER_02: Do you think that and and I don't want to throw insurance people under the bus, but do you think that they do you think they are, you know, they know that and they're just trying to get their commissions and their enterprise value up?
38:05
SPEAKER_02: Do you think they don't want to do the work?
38:07
SPEAKER_02: Do you think it's just like like they're trained?
38:10
SPEAKER_01: So there's two or three of them are just ripped, they're just trying to do it.
38:15
SPEAKER_02: They're checking the box, they're they're following the protocol, and you're like, I'm gonna flip it on its head.
38:20
SPEAKER_02: There's a better way of doing this.
38:21
SPEAKER_02: I'm gonna provide as much value to you as possible.
38:23
SPEAKER_02: You're gonna come back to me and give me your next 10 buildings, 100 buildings, thousand buildings, whatever.
38:28
SPEAKER_01: And their businesses, and their personalized homes, and everything.
38:31
SPEAKER_01: And listen, I I will tell you, it's not, it's the industry's fault, but but I talk about this, so that's why it's disruptive, and I sell insurance to monetize, right?
38:42
SPEAKER_01: We have long-term clients, create win-win situations, and that's why everyone comes to us.
38:46
SPEAKER_01: But listen, there's two or three Larry Large Risk Management schools.
38:49
SPEAKER_01: One is Florida State University, which my son attends, and the other one is Ole Miss.
38:53
SPEAKER_01: My son went to Ole Miss.
38:54
SPEAKER_01: So I spoke of both of those.
38:56
SPEAKER_01: There's, and by the way, out of 40 something thousand students at FSU, there's 92 graduates a year from the School of Risk Management.
39:05
SPEAKER_01: But yet there's 6,000 in communications, right?
39:09
SPEAKER_01: There's 580 in finance.
39:11
SPEAKER_01: In the real estate school, 2,800.
39:13
SPEAKER_01: And they have 100.
39:15
SPEAKER_02: They don't want to be in insurance.
39:17
SPEAKER_02: They don't understand it.
39:20
SPEAKER_01: 105% job placement.
39:22
SPEAKER_01: That's how it's so competitive.
39:24
SPEAKER_01: And then they teach them that you better have sinkhole coverage at your house in Boca, even though there hasn't been a sinkhole in 120 years and you don't have a mortgage, and your house is a million dollars higher than you paid for it.
39:35
SPEAKER_01: They don't teach them that.
39:36
SPEAKER_01: They teach them all the coverage is like disaster.
39:41
SPEAKER_01: But we're entrepreneurs, we take risk.
39:44
SPEAKER_01: We put you you took a risk starting a podcast, starting your company.
39:48
SPEAKER_01: So why can't I take risk?
39:50
SPEAKER_01: I don't want sinkhole coverage.
39:52
SPEAKER_01: I'm okay with it.
39:53
SPEAKER_01: But see why?
39:54
SPEAKER_01: Because the banks own insurance syndicates.
39:58
SPEAKER_01: They lobby Congress for the requirements.
40:01
SPEAKER_01: They think it's a bank thing.
40:03
SPEAKER_01: So it's not their fault, right?
40:05
SPEAKER_01: But listen, you and I know there's almost 25 cents on the dollar is commission insurance.
40:10
SPEAKER_01: And I don't want to throw it under the bus because, yeah, I had a claim when we had 26 inches of rain on my house, and I made it.
40:16
SPEAKER_01: And guess what?
40:17
SPEAKER_01: It was a legit claim, and then they fought me on it.
40:22
SPEAKER_01: Let me the point is eventually I got paid.
40:25
SPEAKER_01: So I that that that's good news.
40:27
SPEAKER_02: Uh knowing what you know now, right?
40:31
SPEAKER_02: And and obviously, congrats on all the success in the business, and and you obviously have a niche which EO teaches you as well, uh, of how to how to run a business.
40:45
SPEAKER_02: Do you are you happy you went down the path that you went and got to insurance almost a little bit later?
40:51
SPEAKER_02: Or do you wish you would have gotten in there earlier and you know now you would have been this such, you know.
40:57
SPEAKER_01: Yeah.
40:57
SPEAKER_01: There's an old saying, right, that real estate is is the is the reason that there are is the number one way to become a millionaire in this country.
41:05
SPEAKER_01: Yep, but the money business is a different world, and that's what this business is.
41:10
SPEAKER_01: The insurance business is the money business that allows you to do everything.
41:14
SPEAKER_01: So we have enough volume today where we have our own programs and captives.
41:19
SPEAKER_01: So I can actually form my own program that strips away all the garbage coverage and sell you a real insurance policy and meet bank requirements.
41:27
SPEAKER_01: But what happens was let's say I write$10 million in premium, right, on all 2025 construction or 2021 construction and newer, five miles from the coast in Florida, and it's a wind and hazard, right?
41:40
SPEAKER_01: The fire department's four minutes in Boca, okay?
41:43
SPEAKER_01: Dave County, it's like three and a half.
41:46
SPEAKER_01: So the point is, is there's almost no risk of claims with deductibles in that.
41:50
SPEAKER_01: That's what we structure.
41:51
SPEAKER_01: So you can drop the price for everyone because they have to have it, and at the end of the year, at the end of the year, you're$10 million, you're capturing the commission, 20, 25 cents on the dollar.
42:01
SPEAKER_01: Plus, if there's no major claims, you have reinsurance, admin, all that stuff, you could have a 40% EBITDA on the backside.
42:08
SPEAKER_01: So make another$4 million, and then guess what?
42:12
SPEAKER_01: It's not taxable because it's insurance premium.
42:16
SPEAKER_01: So that what do you do with it?
42:18
SPEAKER_01: You can invest it in real estate.
42:20
SPEAKER_01: So all of a sudden, the insurance and the real estate assets is huge, non-taxable, right?
42:28
SPEAKER_01: Keeps growing the captive, and that renews every single year.
42:31
SPEAKER_01: Then you buy the real estate and deploy it, and you depreciate that off your other income.
42:36
SPEAKER_01: So all of a sudden, you need a family office, you need wealth strategy, you need asset protection, and you're in the money business or the asset business, which you keep creating assets that produce income constantly.
42:51
SPEAKER_01: And that and insurance, my God.
42:54
SPEAKER_01: So, and then when I saw all this handwriting on the wall, finally, right, I was like, holy shit, everything that I've learned in EO, now I can really like scale, right?
43:05
SPEAKER_01: And I'm talking national scale.
43:08
SPEAKER_01: So, and and I learned there's a really good book out there.
43:12
SPEAKER_01: Um, I think it's called The Art of Scaling.
43:15
SPEAKER_01: It talks about, somebody gave it to me from EO a couple of years ago.
43:19
SPEAKER_01: It talks about what's your biggest goal, right, that you can even imagine.
43:24
SPEAKER_01: So I said I want to do a hundred million in premium 24 months ago, right?
43:28
SPEAKER_01: So that's your ceiling.
43:30
SPEAKER_01: It's wow, how do we do that?
43:32
SPEAKER_01: Okay, now raise the floor.
43:33
SPEAKER_01: Raise the floor is what will I no longer tolerate?
43:36
SPEAKER_01: Well, what do I need to get there?
43:38
SPEAKER_01: And by the the biggest factor is the time.
43:40
SPEAKER_01: Now, what if I want to do a hundred million in 12 months or 24 months, right?
43:46
SPEAKER_01: All of a sudden, everything in your mindset changes.
43:49
SPEAKER_01: Elon Musk always used to say that the problem with engineers is they make things efficient that shouldn't exist.
43:57
SPEAKER_01: He used to say that all the time.
43:58
SPEAKER_01: So I've been stuck.
44:00
SPEAKER_01: In my business of the insurance, for I've owned this place almost 17, 18 years from the beginning.
44:05
SPEAKER_01: Fixing small problems like getting more staff, getting uh you know, systems in there, a tech stack and everything.
44:12
SPEAKER_01: But what I never realized is that's how you scale.
44:16
SPEAKER_01: And the you know, so the company that got you here won't get you there.
44:22
SPEAKER_01: It's a completely different mindset.
44:24
SPEAKER_01: So if you say you want to be, I say I want to be a hundred million dollar company and I'm only doing 10 million and I want to do it in 24 months, everything you did before changes.
44:33
SPEAKER_01: And that, by the way, was finally how I attracted my integrator, which is my COO.
44:40
SPEAKER_01: My COO built$4 billion worth of real estate in Manhattan.
44:45
SPEAKER_01: I got him from New York, he retired to Florida, he was 58, exited, right?
44:50
SPEAKER_01: 12% equity in that company.
44:52
SPEAKER_01: He was going to retire.
44:53
SPEAKER_01: He heard me talking at a real estate convention about this.
44:55
SPEAKER_01: He's like, holy shit, this guy's right.
44:57
SPEAKER_01: I've been writing million-dollar checks to Marsh every year for our development.
45:01
SPEAKER_01: This guy was the CEO of the New York City Housing Authority to some degree.
45:04
SPEAKER_01: This guy is so, he came to the I hired a recruiter and he showed up.
45:09
SPEAKER_01: He came with three briefcases, you know, 50 highlighters.
45:12
SPEAKER_01: He's a master in EOS.
45:14
SPEAKER_01: Guy makes half a million bucks a year.
45:17
SPEAKER_01: Long story short, is when he saw the visionary, and then I launched the personal rad, and my, he's like, holy shit, we could raise capital from this.
45:25
SPEAKER_01: We could deploy it into real estate.
45:27
SPEAKER_01: And I got him to come in, right, at a lower number on a salary, but with equity.
45:32
SPEAKER_01: He's tied to EBITDA, right?
45:34
SPEAKER_01: Every million in EBITDA, he gets a percentage of my company.
45:37
SPEAKER_01: And I'll tell you, game changing.
45:40
SPEAKER_01: Game changing.
45:41
SPEAKER_01: He told me where we're gonna go for the first eight months.
45:44
SPEAKER_01: He goes, the first we're gonna build systems, we're gonna start over, we're gonna do this, tech stack it, AI, we're gonna do that.
45:49
SPEAKER_01: He goes, get ready.
45:50
SPEAKER_01: 35% of the people are gonna leave because we're gonna have full visibility, we're gonna stop silos.
45:55
SPEAKER_01: This guy is institutionalized.
45:57
SPEAKER_01: Everything is KPIs driven, right people, right person.
46:00
SPEAKER_01: And he is so aligned with me, he sleeps four hours a night, worse than me.
46:04
SPEAKER_01: And he's like, Jerry, and once, because I went through three other COOs.
46:10
SPEAKER_01: I did not know how to hire.
46:11
SPEAKER_01: And this guy, he only wants me to show up and sing.
46:15
SPEAKER_01: I'm I'm the guy, the visionary, and our integrity is aligned, our value systems are aligned, and that has changed everything on the institutional level.
46:25
SPEAKER_01: And we meet twice a day for strategy sessions, literally working sessions.
46:30
SPEAKER_01: And every time we come up with a way to get there quicker, faster.
46:34
SPEAKER_01: So what we were building four months ago is no longer necessary.
46:38
SPEAKER_01: It's crazy the mindset shift.
46:41
SPEAKER_01: So that's one really thing that I I've learned in the last 24 months.
46:46
SPEAKER_02: Good for you, man.
46:47
SPEAKER_02: Good for you.
46:48
SPEAKER_02: And and I think that says a lot about, right?
46:50
SPEAKER_02: You gotta always, as entrepreneurs, as people, I mean, you gotta always continue to reinvent yourself, right?
46:57
SPEAKER_02: You what's working today is not gonna work tomorrow.
47:01
SPEAKER_02: And my mentality is you always have to push no matter what.
47:06
SPEAKER_02: Uh sometimes we get we sometimes we get really you know happy and stagnant, and we're like, oh, everything is going great.
47:14
SPEAKER_02: And then you get punched in the face and you're like, oh shit.
47:18
SPEAKER_03: Yeah.
47:18
SPEAKER_02: So if you keep if you keep pushing, pushing, pushing, pushing, uh, you are going to have great success.
47:27
SPEAKER_02: It's crazy.
47:28
SPEAKER_02: Jerry, and it's stressful.
47:32
SPEAKER_02: But it's fun, it's fun, it's fun stress, right?
47:35
SPEAKER_02: I mean, it's it's it's a different type of stress, right?
47:37
SPEAKER_02: It's it's it is.
47:39
SPEAKER_02: I I like to say entrepreneurship is a game, right?
47:42
SPEAKER_02: Uh like athletes play, you know, professional football, soccer, whatever it is, and they need to go in there and you know, work out, train, eat right.
47:52
SPEAKER_02: I mean, our game is is business.
47:55
SPEAKER_02: We solve, like you said, complex problems and are able to solve them, and other people are able to, you know, benefit from that.
48:02
SPEAKER_02: So 100%.
48:03
SPEAKER_01: Yeah.
48:04
SPEAKER_01: No, and it's a relentless pursuit of just building, building, building.
48:08
SPEAKER_01: My biggest issue is like sometimes like I don't know how to be still.
48:12
SPEAKER_01: That's I I've I've been reflecting a lot.
48:15
SPEAKER_01: But even last night, I was like, I felt sad and lonely last night.
48:18
SPEAKER_01: And yes, things are good at the office.
48:20
SPEAKER_01: I was speaking in LA, I took my kids to Barcelona, took my kids to Ibiza, I have that life of freedom, right?
48:27
SPEAKER_01: Then my son went to school, we bought him his first investment property at FSU, my other school with his friends.
48:32
SPEAKER_01: I'm sitting there on Monday night, go to an office yesterday.
48:36
SPEAKER_01: Business is good, same stuff.
48:38
SPEAKER_01: And I'm sitting there and I was like, I felt depressed and sad.
48:41
SPEAKER_01: And I'm like, what's wrong with me?
48:43
SPEAKER_01: And I kind of reflected, listened to Napoleon Hill on a podcast, right?
48:48
SPEAKER_01: And walked around the block for two miles, and I realized like I have a troubled time still sitting still in peace.
48:54
SPEAKER_01: I need to find a problem to solve.
48:57
SPEAKER_01: So it's okay, right?
49:00
SPEAKER_01: It's okay.
49:00
SPEAKER_01: And then a friend of mine called me and I was talking to him about it, and he's like, Well, maybe you should focus on balance.
49:06
SPEAKER_01: But my old mentor told me, like, you know, balance, like if I have a pen, right, around here, here's balance, the center, right?
49:15
SPEAKER_01: He used to say, No way, life is is out here, right?
49:19
SPEAKER_01: You got to be out on the edge of your comfort zone and so on.
49:22
SPEAKER_01: So you show me anybody who's become obsessed with something, meaning sports, right?
49:28
SPEAKER_01: Like you said, business, entrepreneurship, with that hustle, relentless pursuit.
49:33
SPEAKER_01: I'll show you someone who's respected and successful as long as they have the right value systems, which most of them do, right?
49:39
SPEAKER_01: Because otherwise we wouldn't know who they were.
49:41
SPEAKER_02: Otherwise, they're a criminal and it's gonna come to an end, right?
49:44
SPEAKER_01: Correct.
49:44
SPEAKER_01: Well, they're in jail or they're dead.
49:47
SPEAKER_01: Or they're or they're Andrew Tate.
49:49
SPEAKER_01: All right, go ahead.
49:51
SPEAKER_02: Jerry, where can people find you?
49:54
SPEAKER_02: Plug your your podcast.
49:56
SPEAKER_02: Uh yeah.
49:56
SPEAKER_02: I mean, I feel like we can have six episodes with you.
49:59
SPEAKER_02: You have a lot to say.
50:00
SPEAKER_02: I love it.
50:01
SPEAKER_01: I love it.
50:01
SPEAKER_01: I love this stuff.
50:02
SPEAKER_01: I I love we're in the zone.
50:04
SPEAKER_01: You are, I am, we found our yeah.
50:08
SPEAKER_01: So Jerry Katz, K-A-T-Z, CEO.
50:11
SPEAKER_01: Just Google that.
50:12
SPEAKER_01: You'll find the brand anywhere.
50:13
SPEAKER_01: Our podcast is real estate profit boost and so on.
50:16
SPEAKER_01: But Jerry Katz, CEO, I'm on X, and I'm on Instagram, and I'm on all that good stuff.
50:20
SPEAKER_01: You could easily find me even on LinkedIn.
50:22
SPEAKER_01: So, but you know, Stan, it was fun.
50:24
SPEAKER_01: I loved it.
50:25
SPEAKER_02: It was fun.
50:26
SPEAKER_02: It was fun.
50:27
SPEAKER_02: And and listen, for those of you watching, and and Jerry might hurt me a little bit for saying this, but I'm gonna say it out there anyway.
50:35
SPEAKER_02: He said something that resonated with me.
50:37
SPEAKER_02: He had mentors, he had people that were there for him, he got advice.
50:41
SPEAKER_02: Hey man, sometimes you might just have to slide into Jerry's DMs or send him an email and say, hey, I have a question for you.
50:48
SPEAKER_02: And maybe that's something that that that maybe that's something that's gonna change your life and and help you get on that right path.
50:54
SPEAKER_02: So don't don't don't don't don't hesitate to reach out to Jerry.
50:58
SPEAKER_02: Uh, we appreciate you coming out to the show.
51:00
SPEAKER_02: You were great.
51:02
SPEAKER_02: And uh thanks guys for watching, and we'll see you guys back here next week.
51:05
SPEAKER_02: Thanks, everybody.
51:06
SPEAKER_01: Right, and by the way, elevate the hustle, free mentorship, folks.
51:10
SPEAKER_01: Have a good one.