Rocket Your Dollar Ep. 16 Real Estate Investing with Generation Z 

A younger generation is starting to invest and they mean business. Alec Chapman, Owner of Blockchain Capital, shares his perspective and successes when it comes to real estate investing.

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Transcription

Dan K.: Welcome everyone to Rocket Your Dollar, the podcast from your friends at Rocket Dollar. In the show, we discussed the power of self-directed investing. My name is Dan Kryzanowski, EVP of Marketing and Partnerships. Thanks for joining us. Let's jump in. Today on the show we have Alec Chapman, CEO of Blockchain Capital. we're going to discuss Gen Z's view on real estate and investing. Alec, welcome to the program.

Alec Chapman: Hey Dan, thank you so much for having me.

Dan K.: Alec, what brings you to Texas this week?

Alec Chapman: I came for Deal Maker Live with Michael Blank. That is a multifamily real estate conference with the top in the industry. It was two and a half days long. Incredible event. The connections there were top notch, and I learned a lot of great information. I'm so glad that I came out and was able to do that.

Dan K.: That's great. How'd you learn of Michael and his network?

Alec Chapman: Actually I went on the Real Estate Guys Summit at Sea this previous March, an absolutely amazing event. I recommend that for everybody. That's a must do event for real estate investors. I went on that event. I had no idea what I was getting myself into. I didn't even know a single person going on that event besides the friend that came with me. I didn't know what I was getting myself into. I would say that's the top mastermind as far as real estate investing goes. I met Michael Blank on that event and knew he had an event coming up, and that's how I found out about his event.

Dan K.: Fabulous. I love to go on the water with you on a hot Texas day, but take myself and the audience here back a few decades. Tell us about your life experiences in Arizona and how you eventually arrived at Blockchain Capital.

Alec Chapman: Yeah. Originally I'm from Naples, Florida. I grew up there with my mom and sister. We, when I was in middle school, moved out to Sedona, Arizona. At first, I didn't really like Arizona. In Sedona, there's no street lights. It's a town of 25,000. Naples, Florida is somewhere around 300,000 for Collier County. I grew up there. I went to finish off middle school. I went through high school there and then decided looking at colleges in the area. Went to Arizona State. I recently graduated there with business entrepreneurship and real estate about eight months ago. I've had a lot of life experiences that most will never have. I think that has motivated me and it contributed to actually my success.

Alec Chapman: My freshman year in college, second semester, I actually was in a pretty serious motorcycle accident. I was on the freeway going about 55 and a car hit me going faster than that. I went through six months of recovery, broke my leg, had a rod and four screws in my leg. I actually had to drop out of college and really was at a low point in my life. Going through that, it just really motivated me to become more, to do more and really break out of that. I'm doing amazing now and have no repercussions of that and grateful it wasn't anything worse. But yeah, I had to drop out of school. I took six months off and then went back into school and finished strong. It's crazy.

Alec Chapman: Actually right when I recovered from that, I bought a brand new car and less than 24 hours later had a drunk driver rear end me and ran out.

Dan K.: Well, take Uber, my friend, but I'm happy that you're on your feet. You're looking good. I never would have noticed. I'm glad you made lemons beyond lemonade. I know you kind of gave it away to our audience here, but when I first met you at the Michael Blank event and even our initial discussions, you're mature beyond your years. I think those that have met you said that. I think that was kind of the consensus of the conference. Do you mind sharing your age, but more so, how does your generation view investing and financial security?

Alec Chapman: Yeah. Obviously everyone wants financial security, but that's if you're going to put in the work and the education to get there. Most of my peers are not really... They're going about their day job, saving a little bit here and there, but they're not really thinking long-term and I think that's a problem. They're thinking really short-term, living for the weekend and stuff like that. Immediately after graduating, I went and read a bunch of personal finance books and that kind of-

Dan K.: Any you remember that you recommend to the crowd?

Alec Chapman: I Will Teach You To Be Rich. I re-read Rich Dad, Poor Dad, which that's a must for everybody, I mean. Millionaire Mindset. The Millionaire Mind, excuse me. Those are just a few, but I just really got into personal finance after that because financial education is not taught in school. That's something that we all need and it's purposely not taught in schools. I think if you want to be financially secure, the first step is with education and putting the time and work in. Once you have the education you can take action, make the right moves, and become financially free.

Dan K.: That's great. Tell us a little more on Blockchain Capital.

Alec Chapman: Yeah. That's a business I started about two years ago. Basically what I do, this is for crypto, I got into crypto about two years ago when the market at the end of 2017, early 2018 went crazy. Bitcoin 20K. Everyone's going wild. I made a lot of money, and I was just super excited about it. I thought that's what I was going to do my whole life. I spent all day and night, sleepless nights until 6:00 in the morning trading and stuff like that. I called up my friends and family just genuinely wanting to help them become successful with it.

Alec Chapman: I said, "Hey, I'm doing well with crypto trading and I'm here to help you out if you want to send me some money that you're comfortable with. Don't send me anything you need immediately, and then I'll take a small percent." I actually got a lot of people from that. I was like, okay, I need to start an LLC to protect myself. I created an LLC. I hired a lawyer to write our contract and go through all the terms. Basically I am an authorized agent working in their best interest on their account. They have access to their account. They can do their own trades if they want. I am not a broker. I am just an authorized agent on their account.

Dan K.: Wonderful. Do a lot of your clients, are they aware that they can use their retirement dollars, whether it's on the crypto side or the real estate side?

Alec Chapman: No, no, they're not really aware about that. They think they just need to keep their money tied up in a 401(k) or IRA, and they're getting very small returns on that. You can definitely take your money out of those places and put them in way better investments. There's so much more.

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Dan K.: I view you as the face of 21st century diversification as we call it at Rocket Dollar. If you were to advise your colleagues, even somebody maybe middle age that wanted to move out of stocks and bonds, what do they invest in and what does their pie chart look like?

Alec Chapman: They could do multifamily investments. They could do real estate investments. They can pull that money out and do a lot more. They can buy precious metals. There's a few things they can't buy like antiques, rugs, but I mean, they can buy most investments with that. I'm personally using my investments for multifamily investing.

Dan K.: Got it. That's great. Are you seeing that your friends and network from ASU, I'm a Thunderbird guy, so we're part of the same family now, have a similar appetite for real estate and multifamily?

Alec Chapman: Not a whole lot. I think it's a very small percentage. Actually a very, very small percentage. People aren't thinking about it. They think that it's too big, it's unattainable, it's a lot of dollars, hard to come by. They're thinking in much smaller mindset and you have to change your mindset and think bigger and be around the right people, people that are thinking bigger and doing bigger things, and then eventually you become that.

Dan K.: Awesome. We're a bunch of dreamers and also doers here in Austin. If you don't mind, tell us about some of the folks you met over the last few days, maybe some tips they gave you for our audience here kind of as we think of, yeah, here's some folks that I can trust and maybe learn from going forward.

Alec Chapman: I met a lot of amazing people really. I'm still reaching out and stuff like that, but I talked to Mauricio Rauld. He's a syndication attorney. That was great. Let's see. Corey Peterson out of Phoenix. He has his own mastermind, Kahuna. I'm trying to think. Oh, Neil Bala. He's the mad scientist of multifamily. A tip he gave me actually, Argus Software is a real estate software that tracks new development around the country. It does a lot of things, but that's just one thing, but he told me that once around $500 million is invested into an area that the software is triggered and then all the institutional investors come in. I found that very interesting.

Dan K.: Wow. You're probably not going to share, but what's kind of, I'm sure you've done research, any hot markets that maybe haven't hit that half a million, or I'm sorry, half a billion yet?

Alec Chapman: I'm really personally invested in the Phoenix market. I think it's very hot. It has a lot of great drivers. Employment, super strong. Maricopa County in Phoenix is the largest growing in the country. It's growing about 86,000 a year. One-third of that is coming from California. I mean it's becoming the next California. Phoenix, we have traffic all day every day now. It wasn't like that in 2014 when I first moved there.

Dan K.: Well, the other two-thirds are here in Austin, so don't worry about that. But with that, and I said I had the benefit of being in Phoenix in the mid-2000s and seeing growth and folks that have survived the cycles out there. For somebody that wants to get in whether through you or this dynamite network you have, as I call it kind of dating before getting married, for yourself or other syndicators, what's kind of the minimum amount if somebody wants to get in?

Alec Chapman: The minimum amount is 50 grand. I mean, sometimes if there's really a long-term relationship that will be built, then I'd be willing to go a little bit lower, but 50 grand is really the minimum for these deals.

Dan K.: Yeah. I think it's a great point. I mean, I know as we underwrite in some of my past lives and other folks that have been on the show, a hundred is just an easy clean number. I think 50 is very reasonable. Folks that want to carry such as our Thunderbird with me probably have a six figure 401(l) or just personally. First of all, thank you for that. I think it's a very fair entry point for folks coming in for very solid deals.

Alec Chapman: Definitely. When you're taking people 20 grand or so here and there, it's just you're going to have a lot of investors, a lot of people to manage, and it's harder to manage the people than the investment most of the time. It's a lot of people to manage and that's why we do 50 grand because it kind of limits the amount of people we can take in. If they don't have the money now on the next deal, they can get in.

Dan K.: Are you guys accredited only at Blockchain?

Alec Chapman: No.

Dan K.: Okay, great. For what I've done on the storage side, we've also have had a mix. Now it depends I would say when I speak probably across the community. Some do have the accredited, some don't. I think it's fair kind of both ways, and I think there's a lot of great deals out there head to toe.

Alec Chapman: Definitely.

Dan K.: Within a decade, my bet is that you will be a household name, at least within the real estate and finance communities. What are your goals for 2020 and then say over the next three to five years?

Alec Chapman: For 2020, my goals are to own over 500 units, and then I'd like to start a young entrepreneur scholarship for young hustlers. I don't care about GPA. I just want to see that they're out there getting it. They're entrepreneurs. That's as far as giving back. Long-term though, my goal before 35, I'd like to own 4,000 doors, and then 100 million net worth minimum, and then also create a long-lasting legacy that lasts for at least the next three generations after me. I want to name it in my grandpa's name because he was such an influence in my life.

Dan K.: That's wonderful. What does your grandfather do?

Alec Chapman: He actually was an engineer and built power plants around the country.

Dan K.: Wow, that's awesome. Good stuff. Well, listen, I think you'll do it and you might even do it by 30, so I'll buy sooner on that.

Alec Chapman: Awesome.

Dan K.: I know you spent a lot of time in Sedona. A lot of us go out there for family trips, conferences. Any tips particularly off the grid that you can tell us about?

Alec Chapman: Yeah. Sedona is an amazing place. I mean, the beautiful red rocks. They always say that like God built the Grand Canyon and lives in Sedona. There's so much to do there. If you've never been there before, definitely do Devil's Bridge. That hike is great. Cathedral Rock. In the summertime, my favorite thing to do is just go in Oak Creek Canyon. Go swimming in the creek. I mean, there's Slide Rock, Grasshopper Point, some of these other places, but they really focused towards tourists. My favorite thing is just to pull off the road and just go hiking down and find your own beach spot. Sometimes you'll find rope swings or cliff jumping. In the summertime, the Oak Creek is the best thing to do right there.

Alec Chapman: I have a friend who owns a Can-Am company. It's actually called Sit on a Slingshot Rentals, Andrew Rupee. If you want to go off-roading and take a Can-Am off-roading, I would recommend him. Another friend of mine owns a secret garden cafe in Tlaquepaque. It's a Spanish village, and it's a very unique and beautiful place.

Dan K.: Tlaquepaque, Arizona or Mexico?

Alec Chapman: No, it's in Sedona.

Dan K.: Okay. Wow.

Alec Chapman: Yeah, it's a Spanish village. The architecture is beautiful.

Dan K.: Nice. That's dynamite. I've been to Tlaquepaque, but in Guadalajara, outside of Guadalajara. Awesome. I mean, to close here, how can our audience help you and ultimately get in touch with you?

Alec Chapman: If anyone wants to reach out to me, I'm on Instagram @TeamAlec. Just DM me and then also LinkedIn/AlecChapman. Those would be the best ways to contact me.

Dan K.: Wonderful. Any final thoughts for our friends out here?

Alec Chapman: Just just keep doing. Just keep taking action. It's not going to happen over night. Just get around the right people, focus in with what you want to do specifically, and just keep putting a lot of hard work. I think just being around the right people is the most important part. That's been the hardest thing for me. My friend groups are changing and it's just been... The people that I like to hang around now are older and, and it's just changing. I like that. It's different. I know because of that it's going to pay off many dividends.

Dan K.: Wonderful. Well, Alec, it's our pleasure and it's an honor to be with you. Thanks for visiting us here in Austin today. I hope to have you on the show soon.

Alec Chapman: Thank you so much, Dan. It was a pleasure.

Dan K.: Thank you for listening to this episode of Rocket Your Dollar. If you enjoyed this episode, please subscribe and share the podcast with your friends. To learn more about self-directed investing or to get started with your own account, please visit us at RocketDollar.com. Like always, thank you to our friends at Capital Factory and the Austinpreneur Podcast for sharing their recording space with us. See you next week.