Highlights from VSV Con 2023

by | May 4, 2023

Nothing inspires action and innovation more than being around high performing, educated experts in their field in a conference setting, and VSV Con which was recently held here in sunny Scottsdale, Arizona brought over 400 talented individuals that we eager network and learn more about this amazing syndication model with multifamily apartment investing.  In the following paragraphs, I’ll share my recent experience from attending one of the best conferences I’ve been to this year.

Day One – The Kickoff

Like any conference, this one started off with an opening from the group that is putting on the conference, Vertical Street Ventures.  Steven Louie shared his story how he met Jenny Gou and both of their paths up to leaving their W-2s to start the company.  Kyle Mitchell and Kiyoshi Simon joined shortly after to round out the dream team, and the group has since acquired $300MM with over 1300 units and had over $180MM in transactions in 2022 alone.  Each of the founders shared their stories over the course of the weekend, and there is no doubt that this is a group of high performing, high class individuals that not only care about driving investor returns, but they also care about the communities and the employees they serve.

In a very smart move, the group chose to have their keynote speaker follow the kickoff to get everyone engaged and eager to dive into the material.  Damon West took over the stage at this point to share his amazing story which led him from a college sport ending injury to stockbroker to meth addict and ultimately a 65-year prison sentence.  He shared a story about the difficult environment within prison, but an even more difficult story about maintaining a promise he made to his mother before going to prison and an unlikely mentor that helped him maintain the mindset that was needed to get out the other side of this terrible experience a better man.  He told the “Coffee Bean” story that was told to him, and it went something like this:  carrots become soft when they are soaked in water, eggs get hard when boiled in water, and coffee beans have the unique ability to change the makeup of all the water they are in.  Damon was the coffee bean in prison, and he is the coffee bean now that he’s been let out of prison as well.  It was an amazing story that pulled the heart strings of everyone in attendance and set the stage for the amazing three days ahead.

The rest of the day was filled with great content about the state of the economy and some of the challenges that operators are facing in today’s marketplace.  Neal Bawa shared his opinions about the banking crisis and his theory that the Q2 earnings releases will require the fed to start dropping rates before years end, and Ken McElroy shared his opinion that he thinks rates will start to stabilize shortly and not start dropping until we head into 2024.  The only consensus across the panel was that some will get hurt by their floating rate debt without rate locks, and those that are sitting on the sidelines with capital will be able to pick up some great deals throughout the remainder of the year and in to 2024.

Day 2 – Property Tours and Great Connections

As we moved in to Day 2 of VSV Con, I was most excited about the property tours and the experience certainly didn’t disappoint.  We toured two very different properties and were able to see real life examples of how these opportunities are structured, managed, and some of the challenges you can run into throughout the whole process.

The first stop was a development in Youngtown where they converted an old office building into beautiful, newly remodeled 1-2 unit apartments, and the most exciting part was that they were able to convert unused land to a new development project.  The new units will provide excellent, affordable housing for the community at a reasonable cost while providing B+/A- finishes for the tenants.  The 2nd stop was a newer build townhome community nearby, and the student lead team shared how they took over the property, improved the common areas and individual units, and decreased the loss to lease to drive value to the investors.

As I’ve found to be the case at all these conferences, the content in the “Big Room” is always amazing, but the conversations that happen in the hallways are usually the best part of the event.  While I ended up missing an amazing story from Siri Lindley (World Champion Triathlete) and a panel with some big players in the space (Kathy Jang, Dyvya Smith, Linda Lim and Casey Christensen), the “Hallway Conversations” allowed me to connect with amazing potential partners, continue to build up upon relationships with existing partners, and I got a real sense of what was happening in the market place by talking to real operators getting things done in this industry.  All in all, Day 2 turned out to be exactly what I was hoping to get from the conference.

Day 3 – Tax Strategies, Mindset and How to Scale to $1.6B

The last day of a conference is always a little surreal.  Inevitably, there are still great presentations and talks to come but the exhaustion has started to set in from the previous days’ activities.  We started the day off with an inspirational story from Jerome Maldonado on his path from a pharmacy education to a developer and Vertical Street Venture partner.  He’s accomplished some amazing things, and he will clearly be a big player in this space for many years to come.

Kiyoshi Simon led the next session about tax strategies, and he shared some high-level best practices and mindset techniques around taxes that will benefit me and the others in attendance for years to come.  Brian Briscoe shared his top 10 lessons learned from being a general partner on many deals, and then we finished with the Grand Finale – Zach Haptonstall from Rise 48 Equity.  Zach walked us through his path to becoming one of the most successful syndicators in Arizona and likely across the entire United States.  Zach shared how bringing construction and property management in house has given them the competitive advantage in an extremely difficult and competitive market.

As I walked out the beautiful venue to head back home to start to figure out how I’ll integrate all the learnings into strategies to drive value to my investors, I’m reminded why I set a goal to go to 6 conferences in 2023:  education and inspiration lays the foundation for amazing opportunities, but hard work and dedication are what drives change.  It’s important for me to continue to attend conferences on a regular basis to keep my pulse on the trends and changes in the marketplace, but it’s even more important for me to build the systems and processes to share these amazing investment strategies with the broader world.  Passive investing through the syndication model is something that everyone should have access to, and I’m excited to continue to share this story with anyone that will listen.

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