Pride of Ownership with Daniel Dorfman

george grombacher 0:02
Dorfman is the co founder of roots investment community they are accompany helping residents build wealth while renting Welcome back to the show, Daniel.

Daniel Dorfman 0:12
Hey, thank you so much for having me. And thanks to the audience for tuning in. Really excited to dive in for the second time on the lifeblood. And yeah, yeah, based on Well, refresh

george grombacher 0:25
your memory, tell us a little bit your personal lives more about your work and why you do what you do?

Daniel Dorfman 0:33
Yeah, so we are the roots investment community, we’re the first real estate fund that builds wealth for both the renter and the investor. And, you know, we, we started this journey three years ago, and have really, you know, just been enamored with the Win Win and the ability to align the interest of both landlord and resident. And what we’re seeing is really remarkable from a community standpoint now, of growth. Last year, I was on this show, and we had just launched our platform had about 300. Investors, I think we had raised $10 million. Today, we’ve got over 6000, investors for and we’ve raised a little over $34 million to the platform. And I don’t think that’s because we’re good at marketing. I think that’s because when you have a great community of people who want to make a difference and a change in industry, that’s always kind of been stuck in the rut. You get a lot of momentum that way. And you know, it’s been it’s been really great. And thanks to any of the listeners who signed up the first time, so we appreciate you. Yeah,

george grombacher 1:47
that’s incredible growth. Congratulations.

Daniel Dorfman 1:49
Thanks. Yeah, we’re excited.

george grombacher 1:51
Is the sky’s the limit? Do you how much growth is possible?

Daniel Dorfman 1:58
Well, we hope so. Right. So our, our targets for the platform are to have a million people on the routes platform, building wealth with us by the end of 28. And not just building wealth, but making an impact, right, I think there’s a lot of places that people can put their money, obviously. And, you know, the idea behind what we do here is, you know, let’s put it somewhere where we all make great returns, but where the person who actually is the customer and is, you know, usually not benefiting from it gets a chance. Right. And so it’s been really cool to watch.

george grombacher 2:38
Yeah, and I appreciate that. What has so I’m sure that everything that we do is challenging and difficult. And there’s surprises and serendipities, and all and all those things. You are obviously scaling from 300 to 6000. Investors, and I’m curious to learn about that, and then developing new projects, new, new, new, new properties. So how was all that? Yeah, yeah,

Daniel Dorfman 3:08
it’s been good. You know, I think the challenges that we are learning as every business does, right, is that how do you, you know, really take the time and use intention, when you’re communicating with our community to make sure that just because we went from 300 to 6000, that that 6000 investor doesn’t feel just like it’s a, you know, run of the mill thing anymore. So we try to like really figure out how to focus on creating a unique experience that doesn’t feel like you’re, you know, just one of many. We want everybody to kind of feel that community. So I think that’s something we’ve been focusing on as of late. And then, you know, from a property standpoint, we’re still in the scheme of real estate funds, we are so small. And we haven’t really run into those scaling challenges yet. I think those happen, you know, once you hit the 75 million to $100 million range, and you’ve been operating for a while, and we’ve got our eye on those, but have not hit any of those kind of like operational scaling issues that, you know, I think we will eventually right? Well, we’ll have to kind of gear up really where our focus has been, or where we’ve needed the focus, right, you know, is in that kind of trying to make sure that community is still a community, because it’s important to us.

george grombacher 4:38
So we’ll tackle the the, the scaling on the, on the actual property side next year.

Daniel Dorfman 4:47
So that’s right, this one.

george grombacher 4:49
So working on right now to create that unique experience for each user. How are you thinking or how are you going about actually doing that? How does that how does that work?

Daniel Dorfman 4:59
Yeah, I mean, I think we think through it in different ways, a lot of what we do is listen, right? So I think one thing that we’ve been able to really, you know, do well is get feedback, create this loop of like, Hey, we are available for one on one meetings, we’re available for Ask Us Anything webinars throughout the week. And we’re also not offshoring any of our customer service stuff yet, or anything like that. Because we really want to understand why people invest with us, right. And we want to know what the important things that we could be providing to our community are, you know, we’ve got a very wide range of people from who have invested $100 for us with us and can’t invest anymore, but you know, want to be in tune to people have invested, you know, $500,000 with us who want to see and understand the different, you know, aspects of what we do versus what others do. And so, it’s a very wide range. And, you know, we’re just trying to listen and then understand and put put content out that makes sense.

george grombacher 6:13
In terms of the experience for your renters, how has, how has that worked? I know, the idea of it is awesome, that I can be renting, but still be participating in, in, in in wealth growth. Has that worked out the way you’ve expected over the past year?

Daniel Dorfman 6:34
So it’s actually worked better? You know, I think my background is completely in real estate. I’ve done this for a pretty long time been in since 2009. And when we came up with the concept of what we wanted to do here, it was really about this is really this idea of like, look, we’ve done well in real estate. And the reason we’ve done well is because the people in our buildings have been awesome, right? They’ve paid rent on time, it for the most part, right? Pay them around time taking care of it. And, you know, what if we had this relationship where we’re not just treating that person, like a tenant, but we’re their partner, and they get to grow with us, and I think, you know, what we didn’t, what we expected was the resident to kind of be excited, you know, maybe stay with us a little while longer, what we’re seeing is residents are taking extreme pride of ownership within their units, which is awesome. They’re sending us things that they’re doing on the weekends, that they’d never needed to do, creating walkways, cleaning, pressure, washing all those things. And that’s not part of the program, that’s just pride of ownership and pride of being a partner. And so those things are really unique. The other piece is just operationally, you know, the fund, you know, last 12 months is still up for over a little over 14%. And that is mostly contributed to the residents helping us be more operationally efficient, right, we’re not having to roll trucks out to go check things, because our residents are on top of it, and they’re renewing our renewal rates about 80% Right now, versus industry averages about 55%. So, you know, I think we’ve got something exciting, I think our residents are, are are, are loving the program, you know, they’ve actually saved and invested a little over 465,000 with us, just in their three years. So we’re, we’re really excited about like, kind of that prospect of it and, you know, kind of similar to the way we’re building out the investor communities piece. And that’s building out like the financial literacy components and the things that we could do. From the residences huge to

george grombacher 8:50
that makes a lot of sense. It’s a when when you were talking, it sort of reminded me of having a match on your 401 K at work. And if your your company has a 401k match, that’s really good, it’s probably going to help you stay there for maybe a little bit longer.

Daniel Dorfman 9:07
Yeah, no, I think it’s, it’s very similar to that thought process, right? Like, as a company, you’re matching that 401k Because you want that individual be successful and be able to retire and, you know, not work every day. And we’re kind of similar position, right? Whether they take their deposit or their wealth donor account and deployed into their first home. That’d be exciting for them, or if they just, you know, move and keep a little money in the fund so that they can be a part of the real estate market. Either one works and I think kind of, that’s a great way to shape it.

george grombacher 9:43
There is real estate, let me take a bigger step back think that the American dream was always be able to buy a home and things have changed a lot and home prices have gone up so much and interest rates are higher and and it feels farther away than than it used to. And in a way, you are helping people get closer to that. How, how are you thinking about just just housing in? Maybe in general? Yeah,

Daniel Dorfman 10:14
you know, I think it’s a, it’s an interesting line, right? Because you do on one hand, on one hand, we are buying homes, right. And that is inevitably not a home that someone else is on the retail market purchasing for themselves. On the other. To your point, it’s very challenging right now to go from renting to owning from that step is harder than it’s ever been, it doesn’t look like it’s getting much easier. And so we kind of are taking our spot, which we believe is to kind of be the mezzanine product between that renting and owning, right. Like, if we can give people the opportunity to participate and own a piece of these real estate deals and to be a part of it in a real way, then I think we’re setting that next step up, so that it makes it easier to make that transition when you are ready. Or not right. I think there is like a kind of a thing that’s happening right now, and we’ll see it over the next five or 10 years is maybe it isn’t the best like decision to own a property outright, for less than 5% down, right like in that. And that’s what we’re seeing on these first time home buyers, right. It’s like, hey, maybe the idea is like, have it in a fund where the taxes aren’t going to affect me everyday or the maintenance aren’t going to be as stressful, where the TAT, you know, there’s no debt on my like, you know, soul, you know, every day. And I think, you know, if you watch that progress, and you get this feeling and they can like kind of feel less rushed. I think we’ll see some really unique buying decisions down the line. But there isn’t there’s there’s some interesting paths, I think, opening up within this this sector for sure.

george grombacher 12:05
Yeah, just because things have always been a certain way doesn’t mean that they’re always going to be a certain way and everything else. So the ownership piece that that, that you and Ruth’s are have put forth, I think is super exciting. And it’s obviously working. As you look around, what are some of the other opportunities, you say, you know, what, I think that we’re doing this so much better, or we could be doing a lot better.

Daniel Dorfman 12:36
Yeah, I think over the next year, we’re really excited about kind of, you know, branching out into some other product offering and product types for wealth building within the platform. We haven’t quite locked him in yet. So I can’t really like that’s what we’re listening for. Right is we do have a great little audience and community, and we want to be able to kind of put some of those new opportunities in front of folks to, um, I think there’s a lot of different places that we can all look at, in our day to day life where we’re, like, hey, that could go that could be done a little bit differently, or that impact could be greater, right. And so one of the big things we’re doing is a big, like a fundraising push for our residents over the next like, back into this year, which will be really exciting to try and help kind of not just like help from renting and owning perspective, but to help them if they fall on like hard times and different things. Because stuff happens, right? And that’s that’s when people get in the hole is when we you know, don’t have a backing for, you know, a person for you to call when you’ve got that incident that happens. And so we’re going to start to really try to propel our, our community Ford and kind of a nod that a little bit of a nonprofit type of way to Yeah.

george grombacher 14:03
Is that? Is that obvious to you to do? Or is that it’s not necessarily something that we think about when we think about big, like real estate investment trusts, I don’t think about, you know, we actually want to help people to, you know, become more financially successful or more Well, in general, and how can we help people to do that if we have the opportunity to do that?

Daniel Dorfman 14:28
Yeah, I mean, you know, I think it’s, it’s interesting when you get to do it from the beginning is what I’ll say, right? This wasn’t my first project. It’s not my first company. It’s hard to pivot. When you have a current structure in place, right. It’s hard to start to think outside the box in different ways to do when you have a business that’s been running for five to 10 years and you’re kind of set right and it’s really hard. had to pivot from that, I think when we started this, and we’re able to kind of craft from, you know, a whiteboard and really understand what we wanted to do and be intentional about the idea of building wealth for others. And that’s the lens we look at, right? Every single thing we look at or do is in the lens of how do we how does this help the resident build wealth? And then how does it help the investors build wealth? Because the resident comes first, in our, in our world, at least,

george grombacher 15:28
I imagined that as you’re talking to people would be investors or even even potential tenants, partners, however, however it is you think or refer to them as how do you refer to them?

Daniel Dorfman 15:41
Residents, residents, presidents partners, tenant,

george grombacher 15:45
yeah, that you could see the light bulb kind of turn on, or people that Oh, I totally get it and everything you’re doing is in fact aligned. And it makes sense. And that must be very gratifying.

Daniel Dorfman 15:57
It is, you know, it’s really, it’s really been awesome. And one of those things that’s kind of come out of that is, you know, we’ve, we’ve had a lot of investors who have reached out to us who are property owners, and they’re, like, look like, I want to run that wealth burning program. And so one of the things we’re launching in the next couple of months, actually is an ability for any operator in real estate to run our resident engagement solution, which we’re really, really excited about, you know, I think, from our side, we’re never going to, um, you know, more than 10,000 homes. So if you think about that, from a renter impact standpoint, 10,000 renters is great to impact. But if we could give a tool to the world, to be able to impact, you know, the 25 million plus renters across America, that’s actually doing something that might, you know, prove out pretty well, in terms of a wealth building capacity for for everyone. So we’re super excited about that. And hopefully, we’ll launch that in the next couple months or so.

george grombacher 17:04
Nice. It was curious as to whether or not you see copycats pop up. Yeah,

Daniel Dorfman 17:10
I think I, I hope so. Right. I mean, honestly, it’s, you know, I think from from our standpoint, I’d rather give the tool to do it. Right. And we can help kind of facilitate and, you know, help as many people as we can, right, I think it’s, it would be anti our mission to try to hoard hoard that so we hope people will we hope every renter gets a rebate at some point. That’d be awesome.

george grombacher 17:37
Yeah, yeah. Certainly. Enough business out there. Right.

Daniel Dorfman 17:42
We can make it happen.

george grombacher 17:44
I love it. Well, Daniel, thanks so much for coming back on. Yeah. How? How everybody can can get involved. Yeah.

Daniel Dorfman 17:54
If you’re listening and want to get involved, check us out at invest with roots.com. We have webinars every Wednesday, Friday. If you have questions and great place to sign up online. I host the Wednesday, our partner hosts the Friday. We’d love to see you out there. And thank you so much for listening. And George, thank you for having us again. Yeah,

george grombacher 18:17
brother, for sure. All right. If you enjoyed as much as I did show, Daniel, your appreciation share today show the friend who also appreciates good ideas, go to invest with roots.com. And check out all the great information on the site. Check in on Daniel on Wednesday, for that webinar. There’s also the Friday webinar and then we’ll sort of get your feet wet and into the world and see what the opportunities are. Next good Daniel. Awesome. Thanks, man. Till next time, remember, do your part doing your best

george grombacher 16:00
So if I want my iPhone, and my Tesla and my Bitcoin to work, we need to get the metal out of the ground.

Pierre Leveille 16:07
Absolutely. Without it, we cannot do it.

george grombacher 16:13
Why? Why is there a Why has production been going down.

Pierre Leveille 16:21
Because the large mines that are producing most of the copper in the world, the grades are going down slowly they’re going there, they’re arriving near the end of life. So and of life of mines in general means less production. And in the past, at least 15 years, the exploration expenditure for copper were pretty low, because the price of copper was low. And when the price is low, companies are tending to not invest more so much in exploration, which is what we see today. It’s it’s, it’s not the way to look at it. Because nobody 15 years ago was able to predict that there would be a so massive shortage, or it’s so massive demand coming. But in the past five years, or let’s say since the since 10 years, we have seen that more and more coming. And then the by the time you react start exploring and there’s more money than then ever that is putting in put it in expression at the moment for copper at least. And what we see is that the it takes time, it could take up to 2025 years between the time you find a deposit that it gets in production. So but but the year the time is counted. So it’s it’s very important to so you will see company reopening old mines, what it will push also, which is not bad, it will force to two, it will force to find a it will force to find ways of recalibrating customer, you know the metals, that will be more and more important.

george grombacher 18:07
So finding, okay, so for lack of a better term recycling metals that are just sitting around somewhere extremely important. Yeah. And then going and going back to historic minds that maybe for lack of technology, or just lack of will or reasons, but maybe now because there’s such a demand, there’s an appetite to go back to those.

Pierre Leveille 18:33
Yes, but there will be a lot of failures into that for many reasons. But the ones that will be in that will resume mining it’s just going to be a short term temporary solution. No it’s it’s not going to be you need to find deposit that will that will operate 50 years you know at least it’s 25 to 50 years at least and an old mind that you do in production in general it’s less than 10 years.

george grombacher 19:03
Got it. Oh there we go. Up here. People are ready for your difference making tip What do you have for them

Pierre Leveille 19:14
You mean an investment or

george grombacher 19:17
whatever you’re into, you’ve got so much life experience with raising a family and doing business all over the world and having your kids go to school in Africa so a tip on copper or whatever you’re into.

Pierre Leveille 19:34
But there’s two things I like to see and I was telling my children many times and I always said you know don’t focus on what will bring you specifically money don’t think of Getting Rich. Think of doing what you what you like, what you feel your your your your your, you know you have been born to do so use your most you skills, do what you like, do what you wet well, and good things will happen to you. And I can see them grow in their life. And I can tell you that this is what happens. And sometimes you have setback like I had recently. But if we do things properly, if we do things that we like, and we liked that project, we were very passionate about that project, not only me, all my team, and if we do things properly, if we do things correctly, good things will happen. And we will probably get the project back had to go forward or we will find another big project that will be the launch of a new era. So that’s my most important tip in life. Do what you like, do it with your best scale and do it well and good things will happen.

george grombacher 20:49
Pierre Leveille 21:03
Thank you. I was happy to be with you to today.

george grombacher 21:06
Damn, tell us the websites and where where people can connect and find you.

Pierre Leveille 21:13
The it’s Deep South resources.com. So pretty simple.

george grombacher 21:18
Perfect. Well, if you enjoyed this as much as I did show up here your appreciation and share today’s show with a friend who also appreciate good ideas, go to deep south resources, calm and learn all about what they’re working on and track their progress.

Pierre Leveille 21:32
Thanks. Thanks, have a nice day.

george grombacher 21:36
And until next time, keep fighting the good fight. We’re all in this together.