Construction Risk Management: Protect Your Real Estate Profits

Randal Funchess (00:00)

I talked with the carriers and the underwriters and they found out that hey, if we had this conversation before the contract was fully executed, we could save some money, we could save some time. Saving time made them money, saving money saved them money, obviously. So it was one of those things where it was like, hey, what if I could take 10% off of this cost up front? And if you have five homes, and let’s just say I just saved you, I had the last guy I did this for save thirty five thousand dollars.

Freddie Steen (01:58)

Welcome to the *Investor Fuel Podcast*, brought to you by *Real Estate Pros*. I’m your host, Freddie. You know me, but who I get to introduce to you today is someone I’ve been looking forward to chatting with. Randal Funchess, who’s been making serious moves in an asset class that all of you will be able to appreciate. Randal, I’m glad to have you here.

And I think our listeners are really going to take something away from how you’re approaching several asset classes in the real estate market. Insurance, you touch rental arbitrage, you deal with funding, you even broker deals. Let’s dive in. First off, for people who may not be familiar with your world as an investor, as well as someone who can raise capital and insure that capital, give us the short version. What’s your main focus these days?

And what markets is Randal operating in?

Randal Funchess (02:52)

Well, thank you for having me today. I operate r exclusively not exclusively, but I work primarily in the Arizona market and currently with my investors for Arizona. I also have some build dealings in Colorado and the state of Iowa as well. And so we are doing a lot of investment insurance based things and so and then also how we can level up those things. So that’s our primary focus is leveling up from more than just investment and how I can utilize my resources to move that to the next.

level.

Freddie Steen (03:22)

Love it. I love it. when you move from a solo investor to a true CEO, you’re an operator now. I mean, you’re no longer just protecting your properties, you’re protecting an entire organization, employees, joint venture capital. I mean, what was the hardest operational part of your business for you to step away from and delegate so that you could focus purely on high level risk strategy and macro growth?

Randal Funchess (03:47)

So for me, the hardest part was having that day-to-day control. So I will be a little bit vulnerable in saying that I felt like the message that I wanted to portray in the day-to-day operations was going to lack something if it didn’t have me as the spin person. And so now being able to leverage staff delegating or even technology, because that’s something that I’ve was really hesitant, but it’s not going anywhere. So I’ve taken it on and grabbed it by the horn. So I would say

being vulnerable and saying, hey, I need to delegate it, And then a part of what I talk to people about leveling up is understanding that time management and things like that are really important in the day-to-day things. So if I can focus on the higher end things and I could delegate some of the others, it definitely allowed me to be a more energetic person for my staff as well. So for that matter.

Freddie Steen (04:35)

Love it. Randal, we always love sitting down with you because you sit right at the intersection of two massive worlds, real estate and commercial risk. A lot of guys treat insurance like an afterthought. I mean, just a line, they check off at closing. But you saw because we talked earlier, a massive bridge between protecting assets and acquiring them. Take me back to that transition.

I mean, when did you realize that mastering commercial lines and risk management was actually going to be your unfair advantage in scaling your real estate portfolio?

Randal Funchess (05:10)

So for me, I took a step back and I met with my carriers. so I was working with some contractors and things like that. We’re building some track homes and they were like, hey, how do I get this to work? And what was happening was is they were reaching out to me after they had a contract in place and they were saying, hey, this is what I need to be compliant with this contract.

And then I talked with the carriers and the underwriters and they found out that hey, if we had this conversation before the contract was fully executed, we could save some money, we could save some time. Saving time made them money, saving money saved them money, obviously. So it was one of those things where it was like, hey, what if I could take 10% off of this cost up front? And if you have five homes, and let’s just say I just saved you, I had the last guy I did this for save thirty five thousand dollars.

Day one from the conversation with

of bringing me a risk manager in at the beginning of this contract so that I can manage the risk with him. So now when I go to my carriers as a broker, I’m not giving them an application based on what they need. I’m saying here’s what we’re doing and here’s how this project is going to be safer than the next contractor that is doing this. So I just reduced the upfront cost so that now he has more profit and things like that on the tell end of those. So and these were things where they were building and they were going to be obviously selling them with

within a short amount of time. So it’s I can give you this or I can give you a one year policy and hope for the best.

Freddie Steen (06:33)

Absolutely. Randal, let’s talk about the current market. because it’s wild out there right now, right?

Randal Funchess (06:38)

Yeah, and I live in the wild, west, so that’s exactly what it is. So

Freddie Steen (06:41)

We are seeing major shifts in property insurance premiums and carrier guidelines across the country. I talked to a lot of real estate pros here on the *Investor Fuel Podcast*, and a lot of investors are complaining about rising costs. The elite guys are finding ways to mitigate risk and keep deals alive. When you’re underwriting a new commercial asset or a massive portfolio, how do you structurally look at risk?

differently than a standard investor who is just taking whatever quote their broker hands them.

Randal Funchess (08:01)

So the first side of that is I meet the investors at the day one of the project and then also let them know sometimes you may go to a general contractor who’s gonna give you a bid and if I’m there in the beginning, I can say this contractor will qualify you for reduced insurance costs.

I can also go to that contractor, because I have experience with that, 20 years experience with these contractors, and I can help reduce their costs. So that if they’re giving you a bid, they’re not giving you a bid that’s not competitive to their other folks, or they’re not having to cut a corner in order to reduce that cost. So for me, having me as a risk manager day one, I can say, here’s how we’re going to mitigate this risk. In addition to that, as an insurance person, when you go to an agent and you have a project and it’s already

completely executed contract, they’re just gonna submit an application. From a standpoint, if you’re just submitting an application, you’re gonna get the standard rates. I’m talking to an underwriter and I’m saying this is how this risk is different than the next project that’s a quarter mile away. I’m saying these are the precautions that I know are in place because I was there day one. Here’s the safety measures that the GC is going to take. But if you have an agent that you’re working with

And the agent doesn’t know what your GC is gonna do, then they’re just gonna give the application because that’s their job. And then they’re gonna love you because they’re gonna make the same. Again, I can give you insurance with a broker fully underwritten and not know these things. My commission is X. It still will be X if I can get the cost down. My cost will not change based on that. So as the risk manager.

It’s not impacting my bottom line if I save you. I’m going to use the number 5000 because it’s the round number, right? So if I save you five thousand dollars, it doesn’t change the amount of that I get at the end of the day. So for me, I can have a better project conversation with you and help you get to the next property.

And so that you’re able to move on to the next. And I know from a leadership role, again, I talked about being vulnerable delegating things, right? So once you have someone and you’re like, hey, you’re my partner in the risk management side of things, you’re my partner in having these conversations. I’m in Iowa right now meeting with a client that is going to be building some things. I’m here literally to meet with them about a project that they’re bidding on. If they don’t win this bid, I’ve just taken a risk.

And I’m okay with this. I’m risk adverse and having here being here in person for this conversation. So that now if they win the bid on this project, I get to go back to the underwriters and say I’ve walked that property. I’m not just the guy behind the computer in this situation that gave you a policy. I’m a person that understands the risk. So my carriers love partnering with me because they know that I did my homework.

Freddie Steen (10:40)

Randal, I love that. I mean, let’s stay right there. I mean, because this is kicking off at a thousand miles per hour. And this is what our real estate investor pros love to talk about. Let’s talk about the absolute nightmare. Let’s talk construction execution and technical risk management. Randal, you’re a master in this space. The nightmare scenario for any developer, a major subcontractor defaults halfway through a project.

Or a supply chain delay grinds work to a halt while interest fees keep ticking. Most guys just cross their fingers, pray their GC handles it. But from a master level, Randal, how do you structurally protect a project using tools like subcontractor default insurance or performance bonds so that a single sub going under doesn’t sink the entire investment?

Randal Funchess (12:10)

So I work with the G C to make sure that their builder’s risk contract insurance and I make sure that their performance bond is going to have what’s called an expedition fee built into it. So from a risk manager standpoint, I can say this builder’s risk policy has a contract clause endorsement that’s been added on in order to if that subcontractor caused a problem, I want to speed up the remedy.

So I can endorse on that sub problem and say, here’s my performance bond, and that’s still going to help the situation. That helps remedy the situation. But here’s what my client wants to see. My client wants to know that when this problem occurs, not only can I solve it, I can speed up the resolution. Because if I put in a clause with my carrier to say that, hey, if a problem happens, I want to expedite this claim. I don’t want to have a conversation about this. A claims management, he said, she said. I want to know that.

And that’s where me working with the investor, the GC, and telling the GC, hey, I’m your new risk manager also. So every sub you get, I’m gonna talk to them. I’m gonna take 10 minutes and talk to them. I’m gonna make sure that you are transferring that risk so that one, your policy is written in a way from this level so that you’re able to protect it. And then in addition to that, delay could cause a cost inflation that some

agents may not know exists. So if for example there is a problem with the sub and now you have a delay in the lumber because hey, your permits can’t get moved forward because you’re missing a step. So when you’re on a construction project, if somebody doesn’t do their job, an inspector who has to issue the next permit at the county level can’t do it. So I need to speed up the resolution from this problem and understand that there could be a new cost

offici associated with your cost of goods because the price of maybe lumber increased or the price of the electrical wires for electrician who’s coming in on a tele and then we talk about what’s called a wrap and that becomes very high tech, high jargon thing, but understanding that a wrap may be something that I need to do. How to make sure we wrap up this project in the correct amount of time so that there is no added cost.

That interest that you mentioned, I want to mitigate that day one by having this conversation with you. And for me, my clients are partners. And so I have a system that shows my client, those are one, and then I have people I partner with. If I’m partnering with you, it’s like we’re family. We’re in this together. My name is on the door. That means you’re part of this family now.

it’s not the same as going to somebody else’s agency. It’s my name’s on the door, which means I need to do this in a way that makes sure that it’s getting done right. And I need to have staff that work with me and I delegate now. And again, that’s something that’s always going to be a fun part for anyone to delegate tasks up front. But I can tell you after a few years of doing it, it’s definitely great to have someone to delegate those tasks too. So yeah.

Freddie Steen (14:59)

I love it. Randal, what caught my attention about you was the way you’ve been able to pivot this storied history in real estate and multiple asset class and leverage it to your now. And your now is you are now one of the aficionados in this country on data centers and commercial real estate. I mean the construction market is wild right now. That’s not easy, especially in this climate. What’s been the key

to keeping that machine running smoothly.

Randal Funchess (15:28)

So the key to that has been going back to the you asked about delegating things. Once I delegated, I gained more time. So then I was able to take part in different like town hall meetings and things. And I can see forecasts that are coming out. There’s all these forecasts. Here’s a growing city. five years ago I got a forecast about Phoenix, going to be one of the fastest growing area, and I relocated from Iowa to the Arizona. let me go be Boots on the Ground. I mentioned before Boots on the Ground is important to me.

how can I do that? And I knew Iowa has been making bids now for the better part of ten years for a project that broke ground last year. So knowing that those bids are competitive and what it’s gonna take to push the market there and seeing that long-term thing, having a way to fiscal have the fiscal responsibility of understanding these projects.

If this project doesn’t work, I’m gonna mitigate your risk because I also know that the market, there’s a school like we here in Cedar Rapids area, Iowa City, there’s schools. Utilizing that, understanding here the long-term planning, because again, a partner for me is someone who knows that we’re not in this to get this done today or tomorrow. We wanna be able to perpetuate things. I’m a family man first.

And so how can I perpetuate success for my family? Because that generational wealth is a conversation that anyone listening to this can agree. That’s the long goal. The generational thing. How can I create that and help that level up?

Freddie Steen (16:51)

Absolutely, Randal. in the in the data center commercial space, again, the you’re you aren’t just putting up drywall, right? You’re coordinating massive electrical grids, specialized HVAC infrastructure, millions of dollars in highly sensitive tech equipment, long before the roof is even sealed. How do you structure builders risk policies to spec to specifically account for delayed startup costs?

And soft cost overruns when dealing with these complex high-stakes infrastructure builds.

Randal Funchess (17:20)

That’s where the so the for these situations the bonds come in play. and so that’s where if you don’t have a an agent working with you on how a performance bond is going to help make that w risk work better for you, then that’s one thing. I can tell you here in Iowa, for example, there was a government oversight that re that required a water survey to be completed by a government agency that slowed the project down by ten months.

Before they can break ground, this needed to be done. Now, if I hadn’t been aware of this possibility, because I’d never seen or walked a mile in these shoes, right? Understanding that the government can interfere with this project. The bid was well, like I said, I the bid started ten years ago and it was won seven years ago. And they got to break ground too. And but that d that delay happened.

That was caused by a survey. So when you look at data centers, you’ll hear people say there’s an environmental factor. And if you don’t know that environmental factor and what time is going to take, I need to be able to go to my carriers day one and say, What if I have a twenty-four month delay because of a federal government agency? How can I protect my clients at that point?

And that’s a day one conversation. That’s not a now that this happened. We have to retroactively decide how to rectify this situation. And so if you have an agent who says, yeah, there is a data center, that’s just it. Okay, but what does it take for this to happen? We know that someone’s gonna say that creates new jobs. So who is this gonna impact? First, that client building the data center. Second, the residential environment around it.

Next, what other things are needed? Are you going to build a grocery store there? The new dentist office that’s popping up across the street. What are the new surrounding factors in that communication? Somebody just built a leased building across the street from where the data center was going to go, and they were going to put these restaurants in there because the building was supposed to be done by X date. And how do these restaurant owners know?

That their project is still moving forward because there’s no newspaper article that says that there was a delay caused by a water pollution survey that didn’t happen by the government, That conversation is not had. And if you don’t know, you’re sitting there thinking, what’s going on? If you don’t have a partner in risk management, there is no way for you to understand what’s happening and you can’t mitigate something that you didn’t know was happening behind the scenes.

Freddie Steen (19:37)

Now Randal, every operator I know has a moment where things got real. Maybe a deal that went sideways or a time they had to pivot fast. You mind sharing one of those moments for you?

Randal Funchess (19:50)

for me, COVID. So I talked about learning about the market shift in my industry and things like that. And then real estate folks will know that you can look at fast growing economies and things like that, and there’s always reports. so when I did trend, I moved to Arizona in the fall of 2019. And as we know, COVID was 2020.

So I had 18 projects that I had been talking to people about. I was a part of these conversations, and they were instantly put on hold for an undetermined amount of time. That’s when things got real, because by all accord, the everyone was telling us COVID was going to be over in 20 days and 30 days, and then there was never a date. All these projects are put on hold, including my own home. My son and I were living in an RV.

On ten acres of land and a solar paddle that I bought from Harbor Freight.

So it didn’t just hit my business, it hit my personal life. Things got real because it was an undetermined amount of time, but luckily for me, I had systems in place where I had worked with underwriters on what this might look like. Not specifically COVID, but delays.

Freddie Steen (20:51)

Randal, first off, man, I love watching your evolution. You’re no stranger to investor fuel because you don’t just stay in one lane. Now, while most domestic investors are fighting over tight margins, as we said earlier, the shifts that are happening in the market in their local suburbs, you went completely macro. And we have to lift this out for our real estate pros investment audience.

You scaled a rental arbitrage enterprise across the Philippines, Phuket, and the researchers tell me that you’re looking even toward Japan. You didn’t just go overseas for lifestyle. We talked earlier. I mean, you saw a massive structural supply and demand imbalance in international tourism hubs. I know you have your toe in travel. Take me back to the moment you looked at the cash flow numbers in Southeast Asia.

and Japan and realized I need to take my US real estate playbook global What was the catalyst?

Randal Funchess (21:49)

So as you said, I do have my tow in travel. And so I actually, as a part of my values to my clients, I have a travel agency built into my insurance brokerage. In 2016, there is a report that talked about the cost of traveling at the time to Japan was cheaper than flying from Los Angeles to New York City. Wow. And it blew my mind because at the time I was able to secure a flight.

From Chicago to Japan for a three hundred and nine dollars round trip. That included my meals and everything built into it. You can do upgrades and things like that, but let’s just talk about that. For three hundred bucks, you can fly to another country. And then I looked and I was getting all these things as a travel agent that said, here’s what the market is doing travel wise. So people were going to these places.

And when I decided to go, I wanted to go see the cherry blossoms in 2016. Beautiful time to go to Japan. There was nowhere to rent. There’s no hotels. There’s no Airbnbs. What am I gonna do? I made the decision because hey, I’ve been seeing this uptick and I want to check it out because the cost was just right for my son and I, And so I started thinking maybe there’s a problem with the availability of it. And so I started looking into what it might take.

to invest in these locations. And if I was to write, I think it’s

Called an autobiography where you write about yourself, basically, right? I would call it stumbled into greatness. That would be my autobiography. It might be a weird thing to say, but I stumbled into greatness when it comes to the international market because I started asking people how do I do it? And they were so willing to talk to me about it, which was surprising, because in our market here, some people are afraid, if I’m in Iowa, for example, to talk about this because it’s you’re taking something out of a saturated market.

I and this market internationally was not saturated. And so it was how can I look at the trends for travel and understand that translate into investment opportunities? The secondary approach was is when I realized that while we may not understand the US dollar unless you go overseas, the US dollar is a valuable thing,

and I talked about this briefly with you earlier, but the idea that my dollar here in the US is sixty three dollars or sixty one dollars right now in the Philippines may sound crazy until you say, What if you could buy a condo for cheaper than buying a pickup truck? Wow. Brand new.

Freddie Steen (24:07)

Wow, Randal, when you pivot from the metropolitan market of Manila to the leisure tourism of Phuket and the unique military tourism demographic of places like Okinawa, I mean your guest avatar changes completely. Would you agree with that?

Randal Funchess (24:22)

Of course, yeah.

Freddie Steen (24:23)

So you’re no longer just providing a bed. I mean, you’re anchoring someone’s entire international vacation experience, as you explained to me earlier, off the pod.

How do you tailor your team’s operational systems so that a guest checking into a villa in Phuket gets the exact same high caliber execution as someone staying in your coming Okinawa footprint?

Randal Funchess (24:47)

So for me it was finding local partners and the area having

Freddie Steen (24:51)

Okay.

Randal Funchess (24:51)

them understand what it means to I talk about level up. So for me, Level Up with Funch is a reality. And what that looks like is bringing on partners who understand what I mean by that. meant that my Phuket partner had to go to the Philippines with me. My training wasn’t a training program like here’s what I want you to do. It was let me show you what I’m gonna do with a guest that’s checking into this Philippine location.

Let me show you some of the resources that I have, or for example with Okinawa right now, I have a partner that I’m gonna be working with over there who understands the military adjacent and what it takes to go visit. Let’s say you’re visiting a family member who’s stationed there, or we have Disney, an incredible attraction there. What is it gonna take to go to Disney? What does it look like for me to tell you that I would recommend Universal over Disney for certain age group and why that matters?

And so leveling up the investment portfolio was that. Yes. Again, that goes back to boots on the ground. Yes. If you don’t have boots on the ground, it’s tough to know. But luckily for me, if you want a partner that’s gonna have boots on the ground, you say you want to invest in Barcelona, that’s something. It’s on my radar. Let’s go be boots on the ground there or I’ll do it and I’ll report back.

I don’t have and I can’t say this is the guarantee. I can only report what I’ve seen over the years and my research started ten years ago. It’s crazy to think that it’s been ten years already, but it’s ten years ago, and I’ve had professional success with it now. And it’s been something that I’ve had the ability to repeat.

Freddie Steen (26:20)

And Randal, that is the key that asks my next question. When you talk about the risk framework of growing rental arbitrage into global arbitrage, as a risk management master, I think it is one of the greatest strengths that you have. I mean, you look at international liability completely differently than a standard host. If a pipe burst in a DMCI condo in Manila or a guest gets injured at a property in Phuket,

Standard US commercial liability insurance doesn’t mean a thing. How do you design a global

Randal Funchess (26:51)

Global

Freddie Steen (26:52)

commercial insurance umbrella that actually bridges these different international jurisdictions and keeps your Demex the capital stack completely insulated from foreign liability?

Randal Funchess (27:04)

Yeah. That goes back to the partnership with the carriers. And so I feel like I use the term partner a lot because that’s truly what it is. Having carriers that understand that you’re going to be in those market or understand that you’re considering those market, even before you go into the market, you should have an agent that you feel comfortable working with so they truly know what it’s going to take for you to move to that next level. Understanding also again the risk of that. So

A market analysis is something everyone’s familiar with. Looking at what you need to be charging and what everyone’s doing, these appraisals and things like that, right? They’re going to tell you best case scenario. Business 101, and I’m not an econ teacher, but econ always talks about an opportunity cost, right? And looking at a high, a medium, and a low, and understanding that sometimes the best option is to go with the low so that you have long-term success. If you want to control a market share.

And I learned this from Walmart essentially. You can control a market share by starting low so that once you control it, no one can compete with you.

So

Freddie Steen (28:08)

Starting low, Randal, that’s the kind of stuff people don’t talk about enough. And honestly, having that long term path to success is what separates the folks who just dabble from the ones who stay in the game long term, like you. Randal, let me ask you this. What are you most focused on solving or scaling next? Level Up with Funch. What’s the next real goal for you?

Randal Funchess (28:30)

Level Up with Funch is to grow my partnership so that I can say that in addition to myself, that I have a generational wealth team, that we have a perpetuation plan for our family so that the next generation can confidently step into what they need to do comfortably. And so for me, that looks like a team of investors that are understanding the market from a holistic standpoint.

a team of folks that are in business for I do things because these are my passions. So they come natural because it’s how can I tie in my offering? I talked about risk management as my leading point into investments. And then when you have enough conversations with people that are frustrated about insurance, it’s easy to dismiss those frustrations. But I’m curious, how can I help remove those frustrations?

As opposed to just being their insurance agent. how can I partner with them going forward so that I can get into that space and learn from them? How do they understand that I’m not here as solely as a competitor in your saturated market? because the saturation, it’s not going anywhere, And so the opportunities are gonna still grow, they’re gonna continue to be there.

But we need to have a team. And so I would love to grow a team of folks who are looking to level up their investment portfolio, their life as a whole, because when you’re investing, what are you doing with the investment? Are you just putting it into an account that just looks great?

Or you being present. I’m a present dad. So my son will tell you that our adventures are next to none. And that’s something he wrote a paper about as he’s a junior in high school. And so when the teachers call me and they’re like, my God, you gotta come read this paper your kid submitted.

I’m excited to read this paper. She just gave me a three second overview over the phone. She felt the need to call me and tell me, I know you’re on vacation. Your son told me you’re in Iowa. It’s like, well, I’m working in Iowa. But yeah, those are the things that are important to me is to have a team who are leveling up holistically.

Freddie Steen (30:28)

Randal, I want to give this space because I too am a father of four: Marley, Freddie, Samara, and Brianna, and I have two grandchildren, Mike and Eden. I wanna give this space in the real estate prose cast to talk about something that we’ve never quite lifted out before, but you raise a very important moment, and this is a pivotal moment for our for our Investor Fuel podcast.

All of the real estate pros that I’ve been able to interview over the course of the time that we’ve had this podcast have most of them have been fathers and mothers. And all of them have had to try to balance family life with our machinations, our aspirations, and our motivations in building generational family wealth, something that’s very important to you. So I want to leave this space.

To give us the 30,000 foot view of something that you started with your son, and they’re called adventure exchanges. Can you just explain that to the real estate pros who are building real businesses just like you right now? How you’ve been able to connect with your son in doing something that is non-traditional.

Randal Funchess (31:35)

So for me, that looks like we got rid of the idea of like a birthday gift or a Christmas gift because what was happening is I was buying toys or video games that were only relevant for a couple hours because the newest, latest, greatest toy came out the next day. And so it was how can I create moments with my son that were memorable? And what that looked like was him telling me, Dad, I want to go to Universal Studios and me saying, Let’s make time for that. And then saying, Hey.

Would you want to check this place out? Here, I found a go-kart place in Kansas. What do you think? And then my son telling me, Hey, this was way cooler. And having that intentional conversation about time. It was for us, we go on three to five adventures a year because what is my investment portfolio if not being present for my child? What is my business growth?

If not being president for school events.

Freddie Steen (32:28)

Yes.

Randal Funchess (32:29)

For me, it’s making memories was a I have a make memories fund. I have an entire bank account dedicated to making memories. What is going to be our next adventure? And so in allowing him to say he picks one and then I pick the next one. There is a infinite a number of beautiful places in this world for us to see. And that started out for me in 2017.

domestically and then COVID forced me to look elsewhere and then it shifted to international now. So now my son and I have spent six months abroad this in the last twelve months while being able to still be present here.

Freddie Steen (33:04)

And what’s your son’s name, Randal?

Randal Funchess (33:06)

Deshaun. my old my oldest’s name is Deshaun.

Freddie Steen (33:08)

And your newborn is on the way, right?

Randal Funchess (33:10)

My newborn is actually four months now.

Freddie Steen (33:12)

Four months old. So we want to say hello to your newborn and to your son, Deshaun, and from the real estate impressive investment, the real estate investment fuel podcast and the real estate pros audience, our eighteen point six thousand subscribers, say congratulations to you for the newborn and Deshaun, we’re all excited about maybe catching up a year from now and finding out what you did on your next adventure with your awesome dad. Randal, I think it’s big and that’s why I took time in our podcast to talk about it, especially

when you’ve already got your toe hole in commercial real estate. you already have your toe hole in understanding risk management. the next move can either compound things or create chaos depending on how you play it. Now, Randal, I know a lot of people listening are either earlier in their journey or looking to level up not just their business, but their family time. And I think they benefit from hearing this.

When it comes to building relationships and growing your real estate network, what’s made the biggest difference for you?

Randal Funchess (34:13)

Me, it’s having the core values first. Again, I talk about family first, has made the biggest difference because the everyone with the family wants to be able to say that they’re able to invest. Or I have a gentleman who his first investment property is actually his first home as well. one of my con level up coach clients has been with me for three years now, working on a plan where he just bought a triplex.

And one of the units is his unit. That’s his first purchase. It’s his home and his investment. So the biggest thing for me is understanding that what a gentleman working at Burger King now, he’s the manager of Burger King. So to all accord, three years ago, he thought it was never going to be possible until he went back to school. Understanding that you don’t have to go back to school to get to the point where I’m at. You don’t have to have

exuberant amount of money to get to a point you have to have a plan that that’s we talk about SMART goals what’s your SMART goal so he and I had a three year SMART goal and he just closed on his triplex he went from paying rent now to having a property that’s paying him his investment property day one because he has tenants already pre-leased these two units out and so for me is

having a base of people who knows that okay this is where we’re at. So now if I can continue to get folks like him, these success stories that are not just my story, because he put in more work than me. I said here’s my executed plan that I did and here’s how it might work for you. So now having him stick around to the next level, which would be hey, how can we get our own community that we’re gonna invest in? Because hey, I can tell you I have individual properties, but what if

We have a community that is, nine homes in a pond. And the valuation of how that would look from an appraisal standpoint and what that looks like to invest in that next level. So you talk about what could create kiosk chaos. I want to track home community that my partners and I decide on this is got to be the name of that community. And then that will be our community. That will be the secession plan for my family because it is what’s next.

some people talk about a family compound that might be a little bit right here, but a bigger picture and what it takes to get to the step where the family compound is happening. And that is having a team of generational wealth folks who understand what investment looks like.

Yeah.

Freddie Steen (36:27)

Yeah, you

can’t fake that, Randal. relationships are everything in this space. All right, before we wrap, if someone wanted to reach out, connect with you, maybe collaborate or learn more about what you’re doing, what’s the best way for them to reach you?

Randal Funchess (36:45)

I could be reached on all social media platforms. My website is funchinsuranceservices.com or funchinsurance.com. my website is one route. Otherwise, YouTube and TikTok, @ifunch. that’s gonna be the shortest and simplest way. YouTube, TikTok, Instagram, Facebook, all of them funch. So if you can remember, it’s like lunch but with an F.

I’m the guy that you’re gonna have lunch with funch. And if you ever take time and you have a moment where you want to have lunch with funch, send me a message. There is not one person out there who’s curious at the very minimum that I don’t want to have lunch with at the virtually. If it’s in a market where I’m at, if it’s in Arizona, Colorado, or Iowa, I’ll come have lunch with you. At the very minimum, I’ll make a new friend or a new person that we can have some type of meeting with. So have lunch with Funch. And all you have to do on all social media platforms is just search for Funch.

I’m @iFunch on YouTube, I Instagram and TikTok also. There’s just an I in front of it.

Freddie Steen (37:37)

Lunch with funch. I love it. It’s perfect. well, listen, Randal, I appreciate your time, your story, and your perspective. And the why is because you are actually executing the balance between work and life, which is life is with your family. You’re doing that at a high level, and we need more people in the space. We’re doing it the right way. So thanks again for being here, Randal.

Randal Funchess (38:02)

I appreciate you. Thank you for having me.

Freddie Steen (38:04)

And for those of you tuning in, if you got value from this, make sure you’re subscribed. We’ve got more conversations coming with operators just like Randal Funchess, who are out there building real businesses just like Level Up with Funch. We’ll see you on the next episode and thank you for listening.