Mike Meldman: From Blackjack Dealer to Real Estate Mogul | E164

Summary

Podcast Summary: In Search Of Excellence - Episode E164

Title: Mike Meldman: From Blackjack Dealer to Real Estate Mogul
Host/Author: Randall Kaplan
Release Date: June 6, 2025

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Introduction and Family Background

Randall Kaplan opens the episode by introducing Mike Meldman, a prominent real estate expert and entrepreneur. Mike shares insights into his upbringing, emphasizing the profound influence of his family on his career trajectory.

“I always start with family because it shapes our futures and who we grow into.”
— Mike Meldman [00:00]

Mike recounts his parents' professions—his mother, Margie, a travel writer, and his father, Burt, a successful insurance salesman who prioritized family time and personal integrity. He describes a middle-class upbringing in Milwaukee, marked by hard work and strong family support.

“We lived and I grew up, I would say, a very nice life, very middle class, had, you know, didn't really want for anything, but anything I wanted I had to earn by working.”
— Mike Meldman [01:02]

High School Leadership and Values

During his high school years, Mike was actively involved in the Key Club, a service organization. His leadership qualities emerged early when he ran for governor of his three-state division, driven by a desire to recognize Key Club sweethearts.

“The whole idea of sending me to Stanford was that I would then go to Law school and be a lawyer.”
— Mike Meldman [06:06]

Mike also shares a memorable experience from a softball championship game where his father taught him the importance of fairness and team spirit, reinforcing values that would later influence his business practices.

“We played fair so we could be proud of ourselves. Hold their heads high.”
— Mike Meldman [04:43]

College Life and Career Shifts

Mike attended Stanford University as a history major, defying his family's expectation of pursuing law. Despite excellent grades, he struggled with the LSATs, which led him to pivot towards a career in real estate after an unexpected stint as a blackjack dealer.

“Graduating blackjack school is more exciting than graduating Stanford.”
— Mike Meldman [16:58]

He emphasizes the importance of adaptability and seizing opportunities, traits that became foundational in his entrepreneurial journey.

Early Career in Real Estate

Mike's foray into real estate began humbly, placing signs in Fremont and cold-calling farmers to secure deals. His tenacity paid off as he quickly ascended to become one of the top brokers at Cushman & Wakefield by the age of 24, earning approximately $700,000—a testament to his sales acumen.

“I have a really good knack for making deals. I think I made 50 or 60 deals my first year.”
— Mike Meldman [25:46]

Facing challenges, such as negotiating with established brokers, Mike learned the critical lesson of recognizing viable deals versus dead-ends, which propelled him into property development.

Developing Discovery Land Co.

Transitioning from brokerage, Mike founded Discovery Land Co., focusing on high-end luxury resort properties. His first major project was a 300-acre ranch in Portola Valley, which he acquired from a Saudi prince. Navigating complex environmental regulations and opposition from academia, Mike persevered for over a decade to successfully develop the land into a profitable venture.

“After 10 years, it finally got approved. And the good news is it was kind of the peak in the market.”
— Mike Meldman [32:38]

His approach emphasized quality over quantity, reducing density to preserve natural landscapes and enhance property value—principles that became hallmarks of Discovery Land Co.

Founding Casamigos Tequila

Mike's entrepreneurial spirit extended beyond real estate. Through his connections with Hollywood personalities like Jerry Weintraub and George Clooney, Mike co-founded Casamigos Tequila. The venture began with meticulous taste testing to craft the perfect recipe, which quickly gained traction through strategic distribution partnerships.

“We sold out literally the first day. So we made another 20 from that first check we wrote of 600 each.”
— Mike Meldman [53:43]

Casamigos Tequila's success was fueled by exclusive marketing strategies, including hosting private events and leveraging relationships with influential figures, culminating in its sale for a billion dollars.

“We sold too cheap? I was the only one who really didn't want to sell.”
— Mike Meldman [58:53]

Building Luxury Clubs and Strategic Marketing

Beyond tequila, Mike expanded his portfolio by developing exclusive clubs like Estancia and Cordova. His focus on creating exceptional amenities and fostering a sense of exclusivity attracted high-profile members such as Michael Jordan, Tom Brady, and Bill Gates. Mike's marketing strategy prioritized enhancing the customer experience over traditional advertising, ensuring that his ventures remained aspirational and highly sought after.

“If you spend the extra 10% instead of cutting the extra 10%, that's a 20% difference and your quality is so much better.”
— Mike Meldman [44:46]

Mike also emphasizes the importance of strong distribution networks and personal relationships in scaling products like Casamigos, showcasing his multifaceted business acumen.

Investment Philosophy and Financial Strategy

A staunch advocate for equity over debt, Mike discusses how avoiding debt allowed his businesses to weather economic downturns effectively. His investment strategy focuses on high-value projects with substantial returns, leveraging brand strength to drive multipliers rather than relying solely on internal rates of return.

“We never took on debt. And that's the pride, the reason we survived.”
— Mike Meldman [61:59]

Conclusion and Key Takeaways

Mike Meldman's journey from a blackjack dealer to a real estate mogul and co-founder of a billion-dollar tequila brand underscores the power of resilience, strategic networking, and a commitment to quality. His story serves as an inspiring blueprint for aspiring entrepreneurs seeking excellence in both professional and personal endeavors.

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Notable Quotes:

• “We played fair so we could be proud of ourselves. Hold their heads high.” — Mike Meldman [04:43]
• “Graduating blackjack school is more exciting than graduating Stanford.” — Mike Meldman [16:58]
• “If you spend the extra 10% instead of cutting the extra 10%, that's a 20% difference and your quality is so much better.” — Mike Meldman [44:46]
• “We never took on debt. And that's the pride, the reason we survived.” — Mike Meldman [61:59]

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This comprehensive summary captures the essence of Mike Meldman's experiences and insights shared during the podcast, providing a valuable resource for those seeking inspiration and practical wisdom on achieving excellence.

Transcript

[Host]

Welcome to In Search of Excellence. My guest today is Mike Meldman. Mike is a real estate guru, the founder of Discovery Land Co. Which operates 36 high end luxury resort properties around the world. He's a co founder of Casamigos Tequila, which sold a few years ago for a billion dollars. He's an amazing investor, many companies including Viori's, and he's the new owner of the Las Vegas Raiders. Mike, welcome to In Search of Excellence. Thank you. Thanks for being here. I always start with family because it shapes our futures and who we grow into. Your mom, Maggie was a travel writer.

[Mike Meldman]

Margie.

[Host]

Yeah, Margie was a travel writer. Your dad, Burt, went to law school, didn't practice, sold insurance. And I want to talk about. They went on a trip to Thailand in 1998 and your mom wrote this blog about. He was wind and dine his whole life because he was so successful in terms of, he hit his quota and he went all on these trips around the world. So what was it like watching your dad sell insurance? That's not a product that we wake up one day and say, I need life insurance today. Someone calls you up and say, hey, you want to buy some life insurance?

[Mike Meldman]

Yeah. So my dad was a true salesman, right? And he was, you know, successful. But we lived and I grew up, I would say, a very like, nice life, very middle class, had, you know, didn't really want for anything, but anything I wanted I had to go earn by working, right? So if I wanted a bike, I went out and got a job and bought a bike. So it wasn't, it was a happy life. My parents were great. My dad was always there when I went to school. He was always there when I got home from school. He coached me all my sports, you know, little league, football. So he's a great, great family life, living in Milwaukee.

[Host]

Did your dad tell you what he did at a young age and he explained to you, hey, this is how I go out and sell something?

[Mike Meldman]

No, I did a. I remember, I can't remember what grade I was in, but I did a, like a report on selling life insurance. And the only thing I really remember from it was the word breadwinner because everything in the insurance business seemed to be about the breadwinner. And so that was kind of the thesis of my report when I was in third or fourth grade. And I remember always going to the office with him, like on a weekend when no one was there and going to the general agent's office and sitting in the big chair. And you know, my dad said, someday this could be, you know, could be yours.

[Host]

Parents watching them, what they do. Very influential in my life, and I know in your life, too, when your dad was your coach in Little League, he would often prop up the kids who weren't doing so well or who weren't good. What was that like, watching your dad do that to people who. You know. As a kid, I wasn't a great baseball player, and I didn't have a coach who said, hey, man, come on, come on. You just didn't play if you weren't good.

[Mike Meldman]

Yeah, well, my dad was the opposite. My dad was a great coach, and he made everyone play. And I remember this as I still remember it. It's a big impact. Made a big impact on my life. We were probably in third or fourth grade, and we were in the softball championship game. The rule was everyone had to play.

[Host]

You play softball, not fast.

[Mike Meldman]

This was softball because we were probably too young, you know, too young for hardball. At the time, it might have been hardball. I can't remember. But, you know, we didn't have t ball or anything like that. So it was a baseball game. We were, like, down by one run. We had two outs. And my dad realized that Randy Burns didn't play. The rule was everyone had to play. So my dad put Randy Burns in. You know, two outs, we're down by one. I don't know if bases were loaded. I don't know if it was quite that dramatic. But Randy went up and he struck out, and we lost the game. And everybody went up to Randy and kind of consoled him and hugged him. And my dad's speech to us was the other team who was like the other neighborhood team, who we knew all the players, they go, they didn't play everyone, so they didn't play fair. We played fair so we could be proud of ourselves. Hold their heads high. And even though we lost, that took the sting away. And even though Randy struck out, no one was mad or angry or a bad sport about it, because we realized we did the right thing and played by the rules.

[Host]

You were also close with your grandfather, and I want to know his influence in your life. And I also want you to talk about Thomas Jefferson as well.

[Mike Meldman]

Okay. Well, yeah, my grandfather, my dad were the probably the two most influential people in my life because they always did the right thing. My grandfather set a great example. We called them the Gump Grandpa.

[Host]

The Gump.

[Mike Meldman]

The Gum Gum Grandpa. Because every time he came over, he would have, you know, the round gumballs. So we would all run over for gum. And let's say we're playing football in the front yard. All my friends would run over and they go, the gum Grandpa's here. And we'd all get a piece of gum. So that was kind of his trademark. And every Sunday when we'd go to his house for dinner, he'd bring us all to Baskin Robbins for ice cream. He was a lawyer, a great guy. Everyone loved him. All his cousins loved him. And he, you know, just him and my dad, like I said, they just always did the right thing. Obviously, that was a great lesson for me and inspiration for me.

[Host]

You're known to a great personality. I think people that have great personalities generally do better than people who don't. Tell us about in high school. Tell everyone what the Key Club is and then tell everybody about you ran for governor against your best friend, and it was a total slaughter at that point.

[Mike Meldman]

Yeah, that was Boys State. There's a Key Club was a service organization that was sponsored by Qantas. Like, all the football players were in it. Like, all the cool guys were in it. So I got. When I was a sophomore, I became a member just because the juniors and seniors on our football team were in it. So I thought it was cool. And then they had these conventions, and we were in a three state Key Club division. It was Arizona, New Mexico and West Texas. And so by the time I was a junior, I ended up running for governor. I won. And so I was the governor for those three states or two and a half states. The reason I wanted to be governor is because I was at the Key Club convention the year before, and the governor got to pick the Key Club sweethearts. And so he got, like, pictures and resumes from hundreds of different girls from the different high schools. So I go, that sounds cool. And so that was literally the reason why I ran for governor.

[Host]

What do you do, by the way? As governor?

[Mike Meldman]

I basically visited different high schools across Arizona, New Mexico, West Texas, met with the different key clubs, talked about what Key Club is, what we were doing, things like that. So I was kind of just a figurehead. But Key Club was a service organization. And what I remember mostly from what I did, a Key Club, I coached Special Olympics, and the person I coached, like, won two years in a row. So that was something I was proud of. But you did stuff like that, right? You had car washes and raised money for certain causes. It just taught you to give back, you know, to give back. And so it was a good lesson and something I, you know, part of the core of who I am is giving back from Key Club. Then I went to Boys State, and Boys State is sponsored by the American Legion. The idea behind Boys State is you take the best all around students and they go to Boise State. So my high school happened to be a big high school. I had probably 3,000 kids in my high school. We got five people who got to go to Boise State. I was one of the five. My best friend. Two of my best friends, Eric Hedlund and Robbie Robinson, were also selected to go to Boise State. So we go. My roommate was Eric Hedland, my best friend. You have like. It's a mock government, basically. So I lived in a city called Orth. So you started with the city government, then a county government, and then the state government. And everyone you know was, you know, nationalists or federalist, whatever the. There's two parties. So it's basically to teach you about government for governor. I ran against my roommate, which was weird, who's my best friend, and we both went to the same high school. So all this was kind of strange. Usually the person wins by three or four votes because you'll get your friends from your high school to vote for you and cross party lines. And so I ended up winning by 60 votes, which was like historic because everyone knew me as Key Club governor. So I had a huge, huge advantage.

[Host]

Actually, on the student front. You had straight A's. You go to Stanford, history major, fraternity guy. You promoted concerts. You were a Deadhead fan. Tell us about this bar called. I think it was called the Pen, and then blasting rock and roll music over the ocean. And then we can flip into the rock and roll at the golf clubs a little bit later in the show.

[Mike Meldman]

Okay. The Nepenthe was the bar.

[Host]

The Nepenthe.

[Mike Meldman]

Nepenthe is a place in Big Sur that kind of overlooks the ocean and the forest of Big Sur. And it's kind of a hamburger joint. And so I used to go down there if I was in Carmel or even drive from Stanford, you know, if I had a date that I wanted to impress. And we'd go there and like I said, it was a hamburger joint. You'd sit over looking the forests and trees, and they just blasted rock and roll. And so I was like that. You know, I kind of grew up in the rock, you know, the rock and roll era. I've always had an affinity for classic rock. When I started Discovery, I would on the golf course, at the driving range, I'd blast classic rock that came from, you know, all those burgers and beers. I had the penthe, but I also did it to make golf fun. And the irony of all this is I never golfed when I started Discovery. And I was never a member of a country club in my life. So I didn't, you know, grow up like a golf snob. And a lot of people who develop golf courses are very traditional to the rules of golf, but I wasn't. So blasting rock and roll just made it more fun for me. I'd go to the driving range and try to learn how to golf. And at least I sucked, so at least I had rock and roll to listen to.

[Host]

I grew up in Detroit. Classic rock guy Rush is my favorite band of all time.

[Mike Meldman]

Detroit's got a lot of.

[Host]

It's got a lot of.

[Mike Meldman]

A lot of rockers.

[Host]

A lot of rockers. How did you become promoter at Stanford? Because was this just something? Hey, I'm gonna. I'm a popular guy. I wanna get people together. I wanna get everyone in a room and make money?

[Mike Meldman]

No, it was more that my friends were in charge of whatever it was called, the Associated Students of Stanford. And they basically did these concerts. And so I was living there in the summer, so they got me and my best friend Bill Maloney involved. And so what we would do, we were like in charge of hospitality, which is kind of ironic now. And so we'd go. If it was Joan Baez, we'd go to. It's probably before Costco, but we'd go somewhere and buy like granola bars and, you know, things that the Joan Baez crowd would eat. I remember doing Huey Lewis first concert. I think it was Huey Lewis Pogo and Dave Mason. And Huey Lewis was like in the back of the stage and just sticking food in his pocket.

[Host]

He was stealing food?

[Mike Meldman]

Yeah, I mean, he just. He's a young kid who was his first show. And I remember we had to go to him and go, look, don't steal the food. You're welcome to it. And kind of teach him how to behave because he's probably stoned out of his mind or something. But it's kind of funny because he's obviously turned into a big star.

[Host]

College today is a big topic about parents. Should we go? Should we not go? 57% of kids who go to college take on debt. The Average debt is $30,000. Takes 20 years to pay off. These are 10 year loans. Even though it takes 20 years to pay off. And we'll go through your jobs one by one. But should kids go to college today? Do they need to go to college?

[Mike Meldman]

Well, I think so. I mean, I think besides the education, the socialization and the people you meet is important for life. Like, my friends from college are still my best friends. So I think, yeah, it's very important. But also, you know, my best friends from high school I'm so close with and my best friends from Milwaukee, you know, from when I was really young, are still very close to me. So yeah, I think it's important for education and socialization.

[Unknown]

I hope you're enjoying this video so far, but before we jump back in, I want to know if you've ever thought about what you need to do to reach the next level of success in your life. Over the last 25 years, I've been an advisor to more than 50 companies. I've invested nearly 100, including Google, lift and Seagate. And I also co founded a company company that today is worth more than $15 billion. I've been incredibly blessed in my journey and at this stage in my life, I want to give back. I want to share the lessons I've learned so you can reach incredible success way faster than I did in my own journey. I've learned that having the right mentor is a massive advantage to achieving our goals. I'm hugely passionate about mentoring others. I'm looking for a few hungry entrepreneurs who are excited to take action on their journey to incredible future success. So if that's you, I've got an opportunity. In the description of this video, there's a link where you can apply to work with me. All you need to do is answer a few simple questions. And if you're a good fit, my team will reach out so we can build a game plan together. All right, now let's get back to the video.

[Host]

So the plan was also, you grew up with a family of lawyers. Everyone went to Marquette Law from Milwaukee.

[Mike Meldman]

Yeah.

[Host]

So you were going to go there until you weren't going to go there. So let's not jump ahead in terms of where you went next. But I'm curious. You said it was the best thing that happened to you in your life. I mean, I'm sure your kids.

[Mike Meldman]

Yeah, I was destined to go to law school. My parents, you know, spent a lot of money on my Stanford education.

[Host]

$6,000 at the time was a lot of money.

[Mike Meldman]

It was 6,000 a quarter.

[Host]

A quarter.

[Mike Meldman]

So it was 18,000 a year. Whatever it was, it was a lot. I worked a lot and made a lot of money. When I was in college, the whole idea of sending me to Stanford was that I would then go to Law school and be a lawyer. And so I took the LSATs, and I probably hung over, didn't realize what the LSATs were, how important they were. And I had good grades at Stanford, so the grades weren't really an issue. I just bombed the LSATs. I don't even remember what I got, but it was a low enough score that I was too embarrassed to apply to law school. Maybe I got my name right. Other than that, I don't know really what happened. I went to Lake Tahoe with three of my three buddies from college, played or learned how to deal blackjack. And so I went to two weeks of blackjack school, graduated. And I think graduating blackjack school is more exciting than graduating Stanford. And I dealt blackjack at Harris for the summer. And I met a guy, and he basically said to me, do you want to make as much money as you want and work as little as you want? I go, yeah, sounds like a great idea. So I started as a commercial real estate broker in San Jose.

[Host]

Let's back up a few steps if we can. So you didn't have a plan B when you didn't go to law school. Right. So should people have a plan B? Because right now I think people say, you got to go for it, you got to go for it. And if you have a plan B, you're not going to be as successful as if you're focused on one plan.

[Mike Meldman]

Well, I guess you should have a plan B. I didn't. It's kind of funny because I was the only one who went into real estate for my college class or even all four classes. When I was at Stanford, everyone went into technology. I was kind of the outlier. But it worked out because all those guys ended up buying in my projects. Once I got to the place where I had projects, I always thought I was a history major. So I didn't have any real technical skills or training or expertise like my friends who are electrical engineers or mechanical engineers. Stanford's a liberal arts school. When I was going through the interviewing process with different companies, my line was, it's not what you learned, it's that you're capable of learning. And that was kind of my philosophy at Stanford, because with a history major, you either go law school or you teach history. And I actually would have been fine teaching history because I like doing that.

[Host]

I also went to law school, but I went to Michigan before I went to Northwestern Law School. Don't test well. Didn't test well getting into Michigan, but I did well at a private School. I graduated magna cum laude in very difficult private school. Then I went to Michigan and I graduated top 1% of my class there. Not because I'm the smartest person in the room. I think if you are, you're in the wrong room. But I worked very, very hard. I was at the library till 10 o' clock at night when nobody was there. Wanted to go to law school. I actually wanted to go to business school, but knew I wasn't going to test well. They made you work for two years. I needed to get out and make money, so I also took the test and got a 36 of 48. I think it was something like the 58 or 60th percentile. My friends who did as well went to best schools. Harvard, Stanford. Of course I got rejected and I don't know how it happened, but my backup school was Northwestern and I went there. It was a good thing I went there. But I hated law school, so maybe you didn't miss that much. We all have menial jobs that we do. I waited tables in law school. I waited tables in college. I bagged groceries in high school for extra money to go on dates. I had a long distance phone bill I had to pay. He worked at Lucky's twice high school at Stanford in the summer. You were in a slaughterhouse, for lack of a better word. Hanging cats, Cattle on Arizona beef.

[Mike Meldman]

It was a slaughterhouse.

[Host]

A slaughterhouse. And then you worked on a rig as a roustabout. Tell everyone what a roustabout is and then tell everyone how it was the first lesson in liability and insurance liability for people getting injured on that rig.

[Mike Meldman]

Yeah. So I was a roustabout, which is the low man on the totem pole on the oil rig.

[Host]

Laborer, essentially.

[Mike Meldman]

Yeah. I mean, I was like, when there's nothing to do, I'd be like chipping paint and repainting things on the boat. But I was really helping the crane operator. So when pipes came in or supplies came in, the crane would take it off the ship, the little tugboat that brought it out, and then it would bring it to the boat. And I had to guide the pipes or the supplies on the pallets onto the boat and then unload everything. Pretty hard labor. It was 12 hours on, 12 hours off for two weeks. So I was literally offshore for two weeks.

[Host]

You would take a boat to this huge rig, the kind of rigs you see in the ocean.

[Mike Meldman]

Yes. We would leave Port Huenemi and go out the Santa Barbara coast on one of the rigs. The first Day out there, the guy who was teaching us, I went with a friend of mine, John Walechka. The two of us did it together. And we had a guy, an experienced guy who was, you know, showing us the ropes, who actually got caught in between pipes. And a pallet of stuff had to be airlifted off the first day. So it was just the two of us, you know, we knew nothing about what we were doing, so we just had to kind of wasn't that hard. We were just had to try to stay, you know, stay safe. And before we took the job, they sent me a letter that basically I had to have my parents sign. And it basically gave an amount of money for each limb if I lost, if I lost one.

[Host]

What was the most expensive limb?

[Mike Meldman]

I can't remember, but I'm sure it was a leg.

[Host]

The summer before my freshman year in college, I worked construction. I worked in this dirt pit that was going to be built, World Weight Watchers headquarters. And I was this skinny kid. I'm looking around and I was thinking to myself, this is definitely not what I want to do. But I think the hard labor is very good experience to look around. And this is how most of the world works. When you were on that rig and we're hanging beef in a slaughterhouse, were you saying to yourself, I'm doing this for the money? And did it motivate you to say, all right, I'm definitely going to go out and I'm not going to do this for the rest of my life?

[Mike Meldman]

Well, I definitely did it for the money because they were hard jobs and they paid well. I think that two weeks on, two weeks off, I was making two or three thousand dollars every two weeks. I worked three two week stints. I went into my senior year with six thousand dollars in the bank. So that was meaningful and probably should save some of it. But I had a fun senior year and I just. The hard work, like I said I did for the money, but it's also good. I'm a pretty discipline. And so I didn't mind the physical labor because I was always trying to stay in shape or be in shape and like lugging cattle. I mean, literally I had to take the cattle. You know, half the cattle's there. I'd go like this. They'd cut it off and learned how to balance it on my shoulder, like without even holding it. And then I'd have to throw it onto a meat hook on the truck. And then we'd drive to Safeway or Lucky's, and then I'd have to take the half a cattle off or a quarter of it off the truck into the butcher shop in the store. And I worked from like 10 or 2am to 11am so kind of screwed up my, you know, my days. But it's hard work and I liked it because it was physical.

[Host]

You touched upon this already. You meet this guy who says you want to make as much money as possible. And so much of our success is taking a risk. It was a startup and then a lot of our risk too is just being at the right place at the right time. So tell us about Fremont and its location in Silicon Valley and then the cold calling experiences that you learned calling on a bunch of farmers.

[Mike Meldman]

Basically the office was in San Jose in like an industrial park. So it wasn't glamorous, it wasn't. I had no mentor or anyone showing me the rope. So my whole training was go to Fremont and it was farmland, look up, go to the microfiche, because at the time you would find the APN number and pull in this microfiche and figure out who owned it. And then I'd go call on them and try to get a sign up. So my whole real estate career started by just putting signs up. And the guys that put signs up, they're going to call you and then you sell them something. And so I did that and I got signs up all over Fremont. People started calling and I start doing deals. And I had a really good knack for making deals. I think I made 50 or 60 deals my first year. A lot of the deals the minimum commission was 250 and you have to split with, I suppose, my broker and some had another broker. So I had a lot of checks for $62.50, but it added up and I ended up doing pretty well my first year. And I remember leasing property, like a commercially zoned house to a termite company. And they'd asked me questions on the lease and I had no idea what the answer was. So I'd call my manager and I said, hey, what's a stopple? And so he explained it to me. Then I'd go to the termite guy, explained to him what a stoppa was, he'd sign the lease, I would leave. And I still didn't know what estoppel was, but I was able to kind of just talk my way through things.

[Host]

Were you cold calling on the farmers? I mean, I know you put up signs, but were you ever just driving up this dirt road with corn fields or fruit trees up and just saying, hey, is farmer Bob here.

[Mike Meldman]

Yeah, I knocked on the door. I knew their names because of the microfiche. And I'd knock on the doors and they were older, and so it seemed like everyone always liked talking about real estate, so they invite me in. And sometimes they didn't have friends or something and would just talk to me about real estate. And so that's how I got going. And as I was putting these signs up, it's kind of funny this. There's a Cushman Wakefield broker who kind of controlled Fremont. And he would call me and say, take your sign down. I'd say, no, I got permission from Farmer Lopez. And he goes, well, I have an exclusive with him. And I go, well, no, I've got permission. I'm not taking it down. And we would fight. And the guy's name was Steve Bure. And so that summer, I was up in Seattle for Seafare, and we had a big group, it's all my college buddies, and Steve Bure happened to be part of the group. And so we became friends instead of enemy. And so at the end of Seafare, which was like early August, he said, why don't you just come work with me so we're not fighting and work together. And he was at Cushman and Wakefield. And so Cushman Wakefield was, you know, the. The big company. After a couple months, I went to work for him at Cushman and Wakefield. And the following year we sold all Fremont. I mean, it was. The developers had a run on it between him and I. We kind of. We didn't control the owners, but we knew them pretty well. So we were able to assemble basically all the land at the end of the year. I think I was the fourth highest paid broker at Cushman Wakefield in the country, and he was third.

[Host]

So what were you making? How much money back then?

[Mike Meldman]

I think of the thing. I think it was probably 700,000.

[Host]

And you're how old at the time? 24.

[Mike Meldman]

24. 24, 23. It was a lot of money.

[Host]

Still is, but really a lot of money back then.

[Mike Meldman]

Yeah, I was going, well, that was easy. I got. The guy at the blackjack table was right.

[Host]

And then you started doing bigger deals. You want to go off on your own. So tell us about your first deal, 300 acres in Portello Valley, and how you raised $5 million for that deal, including from a Saudi prince.

[Mike Meldman]

Yeah, well, I bought it from a Saudi prince. So the one thing I didn't like about being a broker, you didn't have real control over anything. And so like I said, these guys would let me in and talk to me and sometimes, you know, for hours. And, you know, I realized they don't care about selling their land, they just want someone to talk to. And a guy at Bishop Hawk, which was the first company I was at, told me the one thing, the most important thing about being a broker is you need to realize when a deal will happen or can't happen. Because a lot of people spin their wheels on deals that are, that just won't happen and have no business ever becoming a deal. And I remember I drove down to Alameda and met with this dentist who owned this big piece of property in downtown Fremont next to Macy's. And it was zoned for like a high rise condo. And I get the listing. I'm like, oh, this is the greatest thing that's ever happened to me. I'm going to be rich. This is going to be the greatest project. And after like three months of trying to sell it, I realized, well, there's absolutely no high rise condo market in Fremont and probably never will. Something that got me so excited and so jazzed and something that I thought was going to change my life literally was, was a waste of time, zero impact. Except for it kind of woke me up to have a little better control over my well being, basically. And so that's when I moved out of brokerage, got into development. And the first thing I did, I bought this ranch in Portola Valley. Portola Valley is right outside of Stanford and Palo Alto. And So it was 300 acres. And I bought it from a Saudi prince. And he had this Lebanese guy who kind of handled the negotiations. I tied it up for $5 million, had the deal, thought it was great. And then he goes, now what are you going to pay me for the development rights? What are you talking about? We just cut a deal. No, for the property. I have the development rights. So I think we had to pay him like a half a million dollars, which at the time was a lot. And so we got it done, bought it. It was zoned for 28 lots. We had 300 acres. It took over 10 years to get approved because every environmental constraint was on the property. You had this big hill that was covered in landslides. You had the San Andreas fault run through it. You had wildlife corridors, biological corridors. And the people who are fighting me were all like Stanford professors, right? So like I have a consultant on the San Andreas fault to show how we could stabilize everything. Well, the town's geologic committee just happened to be like the guys who Started usgs. And, you know, the biology people fighting us were biology professors at Stanford. I really had to learn how to develop properly and through the environment because everyone wanted to save the environment. And so it gave me a PhD in development well over 10 years. And I remember going to my Stanford friends, hey, can you show up at the public hearing in front of the planning commission? They go, no, no, no. I'm like, why? And they go, oh, my wife hates you. And they were friends. I don't think she really hated me. I'm like, why? Because you're ruining the environment. I go, we're not and have to explain how we're doing and what we're doing. And so, like I said, After 10 years, it finally got approved. And the good news is it was kind of the peak in the market, so we went through a few dips on the way. It ended up being a great learning lesson. It ended up being profitable, and I have friends who actually live there.

[Unknown]

I hope you're enjoying this video so far, but before we jump back in, I want to know if you've ever thought about what you need to do to reach the next level of success in your life. Over the last 25 years, I've been an advisor to more than 50 companies. I've invested nearly 100, including Google, lift and Seagate. And I also co founded a company that today is worth More than 50, $15 billion. I've been incredibly blessed in my journey and at this stage in my life, I want to give back. I want to share the lessons I've learned so you can reach incredible success way faster than I did in my own journey. I've learned that having the right mentor is a massive advantage to achieving our goals. I'm hugely passionate about mentoring others. I'm looking for a few hungry entrepreneurs who are excited to take action on their journey to incredible future success. So if that's you, I've got an opportunity. In the description of this video, there's a link to where you can apply.

[Host]

To work with me.

[Unknown]

All you need to do is answer a few simple questions, and if you're a good fit, my team will reach out so we can build a game plan together. All right, now let's get back to the video.

[Host]

Explain to people how a long development cycle could kill a return on your investment. Because people may say, all right, you sold it. Let's say you bought the whole thing for $10 million and you sold it for $30 million to someone who might not get the math behind that. That may be a Terrible return in actually is a terrible return. And when you think about $20 million gain 10 years later, I mean, it's not on a risk reward basis. It's not what you should be getting on real estate to sell the deal.

[Mike Meldman]

What people do you normally judge investments by internal rates of return. Internal rate of return is basically how much money you make every year compiling. And so if you invested 10 and made 20 over 10 years, that's a bad internal rate of return.

[Host]

Probably around 4% annual compound or something.

[Mike Meldman]

Like that, which you don't, which would be bad, but it's a decent multiple. So we're always internal rate of return driven, or most people are. But in our business, we're not really internal rate of return driven today. I mean, we always were early on because our investors were. But today we're more multiple driven, which means that the brand today is so strong that we could start a deal and have things pre sold. So a lot of times we'll allocate, let's say $100 million for a project that we think is what the capital needs are, and we end up only spending 3 million. Because the brand's so big, we're able to pre sell and so we could supplement the buyer's money with our money. Obviously the IRR is huge when you don't spend any money, but we really want to multiples. And so what we're driven for is just creating as much value as we can. You know, we look at like if we put in 100 million, we want to make a billion dollars. Okay, we don't, you know, if we put in 100, we don't want to make 20 million.

[Host]

You start discovery in 1994 and you bought 640 acres out. Essentially at that point in the middle of nowhere was a cattle ranch. So tell us about Mark Sullenberger and Paul Fey and what happened after Mark gave you a call.

[Mike Meldman]

It was around 1994 and we were the early 90s for real estate for a lot of people were tough. It was ending the RTC days, which is when all the SNLs basically blew up. Our motto was stay alive to 95. Since I went to high school in Arizona, I called a few friends and said, hey, I'm looking for some land because I wanted to get out of California, because California was really, from a real estate perspective, done and gone at the time. And so I wanted to do like a big master plan community, you know, like a sun city, but not age restricted, but golf courses, big density, a big project. So that was the idea I had in my head. And so a friend of mine told this to Mark Sullenberger. And Mark called me and said, hey, I have this great piece of land. They should come look at it. And it's at Pinnacle Peak. And I go, where at Pinnacle Peak? And he goes, pinnacle Peak. And I'm like, and Pinnacle Peak is a landmark in North Scottsdale. I kept asking where? And then he finally explained to me, it's actually you had owned Pinnacle Peak. And so to me that sounds cool. I went out there. They were trying to do a 3,000 room hotel and they were going to have a golf course that was attached to True North. And True north was kind of the hot, high end resort course or public course. And so they explained the deal. I go, 3,000 rooms. Sounds like a lot. It's going to take a lot of money to build it. The Phoenician, which is one of the great hotels you'll ever see, is in bankruptcy. The owner just went to jail. Doesn't sound like the right thing to do. And so there was a transfer from the resident or the resort density into 800 units. And so Pinnacle Peak was a mountain that had the most lush landscaping. Saguaros everywhere. I mean, it was just a beautiful piece of property. Scottsdale's flat, and this is, you know, one of the mountains in the middle of it. We were able to do 800 units. We tied it up. I got Tom Fazio out there.

[Host]

You knew Tom already?

[Mike Meldman]

No, I. I did. I did research. What were the best? Again, you got to remember, I didn't golf, knew nothing about golf. But the best clubs on the west coast at the time were the Vintage Club, Maroon Creek and the Quarry. And Tom Fazio did all three of those. So I called co called Tom Fazio. He said he wouldn't do it because he just did a course called Greyhawk. A friend of mine owned Greyhawk. So I asked him if it was okay if we could hire Tom. We were going to do a private club. His was a resort course. So, you know, people, you know, paid to play it. So he said, you know, he gave Tom permission. We went out there. Tom basically designed, which I still think is one of the best golf courses anywhere. We reduced the density from 800 units to 243 units. We did that because the landform was so impressive that everything I learned from the years in Portola Valley I actually put to practice. The roads were all along the contours. We left everything in its natural state. We de vegged all the vegetation, boxed it up and then replanted it. So by the time the course was done, the roads were in. It looked like nothing happened to the site. It was a beautiful property. We had probably the first sales in Arizona for over a million dollars. For a lot. We were selling like a lot at True north was 60,000. Like, our cheapest lot was 250,000. So that's when I realized by investing in the amenity package, the privacy and exclusivity, you're going to get way more money than your neighbor. The lower density is a little counterintuitive because the more density, the more money you think you make. And to get more density, you'd have to do a lot of mass grading, which not only ruins the environment, but also costs a lot of money to grade. So this whole environmental lesson I got at Patrol Valley made real sense because it's really the most cost effective way to develop. And so if you go to Estancia today, even with the homes, you can't really tell it's a development because the homes even blend into the mountain and the backdrop. It was my first project. I think I was like 34 when I started it. Like I said, I knew nothing about golf. And it's today priced still the best golf course in Arizona.

[Host]

There's all kinds of ways to get sales, and when we don't have a track record, we need to resort to all kinds of things. Let's talk about Whitefish, Montana. And is your advice to people to get your first customers flying four people out on a private jet to come have a look. That's an expensive marketing trip.

[Mike Meldman]

That's kind of how it works. So at Estancia, it was a golf mecca, right? Scottsdale's known for golf. We were surrounded by some of the great golf in the country. Now we had Tom Fazio, everyone else had Morris Weiss call for Jack Nicklaus. So we separated ourselves just by the definition of what we were, which was less members, in my opinion, better golf. And so the golfers kind of migrated, so I didn't have to fly people there, but I had to figure everything out on my own because people were telling me how to do things and what to do. Agree with it or I had to think about. I had to really think to figure it out. I fortunately made a lot of the right decisions. And basically the decisions were based on spending money appropriately and properly. My attitude was, okay, we're going to build this clubhouse. It's going to be the best clubhouse in the state. The course is going to be the best in the State, the food's got to be the best. You know, everything just has to be the best. Everyone tried to convince me to save money here and there. I didn't. Right. So my attitude was if you spend the extra 10% instead of cutting the extra 10%, that's a 20% difference and your quality is so much better. And everyone then told me, okay, go get kiosks at the airport, go do ads in the Wall Street Journal. They were trying to convince me to do all this stuff. And I go. It just didn't make sense. It seemed like too much of a shotgun approach. When we opened the course, I was going around meeting everyone since I wasn't golfing. And I knew who all the guests were because they were big time people, known people, and the members we had at the time were fairly substantial people for Phoenix. So I said, okay, this is what we're going to do. We're going to put all our marketing dollars into the course, into the place. Because if they're here golfing, that means they come to Arizona and they golf. So that's your target audience. The whole place started by doing that. And I would give out hats and T shirts and you know, these rich people like free, you know, free stuff. So, you know, little things like that made a big difference. The comfort stations made a big difference. So it was really making the person feel like a member. Where most clubs make the member feel like a member and the guest feel like a non member and not. And not very welcome. And I always use this line from the movie with Janet Gretzky was in. The movie was called the Heartbreak Kid. They were playing gin rummy and they were at this fancy beach club in New York. And the loudspeaker said the fireworks show are for members only. All non members, please look away. So that's how private clubs were. And so I said, let the members look at the fireworks or the guests. Let's take care of the guests. And that was our marketing. Then my next course was Cordova and it was a local market. We turned it and made it into a Silicon Valley CEO club, which it still is. A gentleman from Estancia helped me with it. His name was Don Valentine, who was kind of one of the founders of Silicon Valley.

[Host]

Sequoia, Sequoia Capital, which for those people who don't know, they funded every big Apple, every big company back in the.

[Mike Meldman]

Day, Cisco, Apple, and he was one of the Fairchild 5. They came out of Fairchild Semiconductors and he went into Venture one one. I mean, there's a kind Of a. He was a big deal, and he was very helpful there. So I had these two projects, and then we started Iron Horse, Whitefish. Montana is kind of an outlier place, but it was beautiful. It had, you know, lakes and Glacier national park and whitewater rafting and had all this amazing stuff. And so when I went and visited, I go, boy, if there were the Four Seasons here, it'd be the most popular Four Seasons in the world. We bought it, but I had to get people there. I would charter, like, a lure 35, and I'd bring my friends up there, and they'd go, okay, we'll come, but we're not going to buy. And I would take them fly fishing, and we just do, you know, the Montana experience. And after three or four days, they'd be going, okay, show me some real estate, Will you show me some real estate? I go, I didn't think you wanted to buy. And they all ended up buying by starting with the Stancin Cordova membership, especially Cordova, because it's all big Silicon Valley executives that helped get Iron Horse going. And then it all kind of spiraled upward from there.

[Host]

I want to talk about Casamigos, but there's a lot there, so I want to take it step by step. And I want to talk about Jerry Weintraub. And you were in a movie, and then you met some interesting people, and then we'll stop the story right there, and then we'll. And then we'll continue it at that point.

[Mike Meldman]

Okay, so Jerry was a very. Was, like, outside of my father, my grandfather, probably the third, like, big influence and mentor in my life. He was a big personality. And when I moved to la, he embraced me. And just his embrace gave me a lot of credibility in LA because he's kind of known for, like, recognizing, you know, talent. And, you know, he took Elvis Presley on tour, Frank Sinatra, and at this time, he was doing the ode Ocean's thirteen movies. I was moved. La. He kind of moved me into his house. And the reason why I think he liked me so much, we did a project in the early 2000s called the Hideaway. It started as Country Club of the Desert, and the developers basically stole money. And so the financial partners shut it down. We ended up joint venturing with them.

[Host]

Is this Nationwide. Nationwide, it's a big insurance company for people who don't know.

[Mike Meldman]

Right. Nationwide is on your side. Jerry wanted to do the deal. And Jerry lived at Bighorn. He's a member at the Quarry, knew everyone at the Vintage, which are three of the Great clubs in the desert. And everyone said, no, it's not going to work. All those clubs are kind of in coves in the mountains. And so they were telling him, this is like, not in the mountains. Got view of the mountains, it's in the flat. And it will never work. We bought it, we repositioned it, and probably sold 600 lots in 18 months. And it was a huge success. And so, you know, Jerry's like, who is this kid? And so he kind of sought me out and, you know, embraced me. Was very, you know, just very helpful to me going forward. You know, I had cameos in some of the ocean movies and I was the, let's say on Ocean 13. I was like the 14th person, right. I would go with them to all the premieres, we'd hang out. You know, I was probably there every day at Warner Brothers when they were shooting. I became very close, obviously with George and the cast.

[Host]

And then you met two guys who were in the movie? Well, one guy who was in the movie and he was best friends with another guy.

[Mike Meldman]

Yeah, so George obviously was in the ocean movies. And George has this group of friends, right? And they're basically his friends from acting school when he struggled and first came to la. And they're all still his best friends. So George is a very good friend and loyal person. And Randy was one of those friends. He didn't go that acting school with him, but they just became good friends because I think Cindy and George shared at one time the same agent.

[Host]

Just to make it clear to people who don't drink tequila, we're talking about George Clooney, Randy Gerber.

[Mike Meldman]

And Cindy Crawford. And Cindy Crawford, yeah, that was the high met him of his group. George is pretty good too at culling the herd in his group because if someone does something he doesn't like, I mean, he's pretty good about, I have too many friends, you're not my friend anymore. And he's really good at being loyal. But, you know, if you break that loyalty, he's pretty good at abandoning you as well. And so I was fortunate that he had his friend group already established. He wasn't looking for more friends. But because of Jerry, we became really close friends. And Randy and George ended up being one of the first buyers at El Dorado. They built these two beautiful Legoletta houses. He's a very famous Mexican architect and they called the house Casamigos, which means house of friends. House of friends, it's a made up word, but it means house of friends is where he'd bring his boys, right, for vacations and golf and play basketball and things like that. And I became part of that group. I was lucky enough to do that because they're all great guys. We were drinking different tequilas. We didn't really love anything. And so we decided to make our own, but just for ourselves, right? I figured I could put in all my clubs, Randy could put them in his bars, and George could just drink a lot. So between the three of us, I thought we would have a business. And so we went to this distillery, and we said, we like Claus Azul, but it's a little sweet. And we like 42, but it's a little bitter. And so we came up with this formula that if you actually do a blind taste test, we won every time. Because if I mean, 42 on its own isn't that bitter. But when you taste it next to us, it's very bitter. And Claus Yazl is so sweet when he tastes it next to us. So we kind of came up with what we thought was the perfect recipe. We did all these taste tests. We won it all. Then we went to Southern Wine and Spirits, and we said, hey, will you? What do you think? And they tasted it and said, we love it. We think you've got a winner. We'll take it.

[Host]

Can we stop it there for just one second? Because I think this is critical to the story. Tell people what Southern Wine and Spirits is. And it's very hard to get on that truck because someone else comes off that truck, right? It's just hard to get that deal. So what was that? What is the process, and how did you get onto that truck and that distribution system?

[Mike Meldman]

Okay, so Southern Wine Spirits is the distributor for maybe 80% of all the liquor in the United States. We started with this gentleman, Larry Ruba, who. So him and Steve Wynn had the distributorship for Nevada. Southern bought it. Larry ran it. So we came in, and Larry liked it, and he said, you guys need a blanco to go with it, and we'll take it. And I said, well, we don't drink the blanco. We drink the repo, so we don't want a blanco. And he goes, well, 85% of the market's blanco. And I said, okay, we'll do a blanco. So we created a blanco to go with it. They said, if you do 20,000 cases, your first year, it'll be a huge success. We went out and we made 20,000 cases. It cost us a million eight. So we each wrote check for $600,000. We sold the 20,000 cases. The first two days we did a little roadshow to the different distributors because they're the ones who really buy it from us. And then they sell it to the stores or the restaurants. And we sold out literally the first day. So we made another 20 from that first check we wrote of 600 each. We never had to put any more money in because it just kept selling, selling, selling faster, faster and faster.

[Host]

I think it's very interesting. Explain what a roadshow is. And then I remember my good friend John Terzian, who's in my wedding party with Madison, who you also know my wife. You went into a nice guy one night and he said, john, I want you to carry my Casamigos there. And of course it's hard for him to carry new spirits because again, he has relationships with people. And just like you, he's got a lot of venues. But I remember thinking, that's really interesting. You know, Mike Meldman, who's a very successful guy who's a centimillionaire, going into a restaurant to ask a guy that owns a restaurant, I mean, it's a one off and obviously he has high profile places to carry your tequila. I love that story.

[Mike Meldman]

Yeah, well, we worked it. I mean, all three of us worked it pretty hard.

[Host]

It's hard to say no to you.

[Mike Meldman]

Yeah, well, one of the good things is, like, people at Discovery is a great platform for good products. What I did is we made Casamigos bars at every project. And so you get it to the right people. And when I say influencers, I don't mean like influencers like people are used to. I mean like guys who own Kroger's, guys who own Albertsons. And like at Bakers Bay. The money behind Albertsons Safeway, both were members at Bakers Bay. The chairman was a member at Madison. You know, I went to them, hey, can you do me a favor? You know, we. We just started this tequila. Could you put it in, you know, Safeway and Albertsons? And they go, absolutely, we'll make it like our house tequila. Any Safeway Albertsons you go into or any of your people go into, and we don't have it, we'll put it there the next day. So I'm kind of the guy who is the favor giver. You know, I don't like to ask for things, and I don't normally ask for things, but this is kind of an easy ask, right? Because they're selling tequila anyway. We didn't have to pay for anything. It's a pay for play. Business, even though it's illegal to do that. Not supposed to be, but it's amazing the shakedown you would get. Obviously we didn't play that way. And even like my friends would try to shake me down, I go, look, if you don't do this, you're never going to El Dorado again for the.

[Host]

Rest of your life or any other club.

[Mike Meldman]

He goes, okay, okay. We were able to really get it in places quickly and easily. We had the distribution because Southern was really, really behind us. And there's a. The CEO of Southern was this guy named Brad Vassar, who's one of my best friends, who became one of my best friends. And he grew up in Sonora, California, which is kind of up by Angels camp. It's kind of the go country. And it's pretty, you know, a lot of meth labs and I mean, it's pretty rough, but it's literally the go country. And one of my first projects that I ever did, and this was like five years before Estancia was a golf community called Saddle Creek and it was right outside of Sonora. When I found out he was from Sonora and that I did Saddle Creek, there was a immediate bond about that and he was a huge help because whatever he said anyone at Southern had to do. And he's a scary guy. Could be a scary guy.

[Host]

Part of having consumer success is you've got one shot at it, right? You get. Someone goes out, they taste something. It could be a product, could be a software product. I mean, as a VC and being a board member for now 50 plus companies, we tell the founders, don't launch something before it's ready because you get one shot and then they're not coming back. You went through 400 different variations of Costamigos before you actually said, all right, we got it now.

[Mike Meldman]

Yeah, well, that was Randy. I mean, I was happy with the first one, but Randy's very particular. His palate's very good and so he really worked it hard. And we're doing a non alcoholic beer right now. We had the tasting yesterday, there was like four of them. I go, this is it. Everyone agree, you know, agreed and ran this. We could still make it better, which is good because that's part what Randy adds value, you know, value. That way we got it right and then we knew it was going to work because everyone liked it, right? And the juice was good. And if it wasn't, no matter who was behind it, it wouldn't work. And you've seen a lot of people since our success try to imitate it and it's just not a lot of it's just not that good. So it doesn't work. If we didn't have good juice, no matter who was behind it, it wouldn't have worked. And the reason it worked besides the three of us all had different strengths and attributes and contributions. It was good.

[Host]

Four years later after starting Dos Amigos, you sold it for a billion dollars. 700 up front, $300 over a 10 year earn out period. What are you thinking that day that.

[Mike Meldman]

We sold too cheap? I was the only one who really didn't want to sell. But you don't want to be the schmuck who turned out a billion dollars and then agave dries up or something like that. So I think we got the balance of the billion in a year and a half that they thought would take 10 years and then they just kept re upping the contract. So we ended up doing much better than that. I mean it was a great success. Just a great success. And it's also fun to have success in a different business for all three of us. And it gave the three of us just reasons to hang out more and be together and go do different things.

[Host]

For the tequila, There are apparently 28 benefits to drinking Casamigos tequila. You have a sign at a comfort station at your Dominican Republic resort and I just got a read free of these. It fixes broken hearts, it relaxes your socks and it makes your hair soft and full. Was this FDA tested? How did that come about?

[Mike Meldman]

Yeah, I think my favorite one was I've been on a tequila diet. I lost three days.

[Host]

Let's move on to the clubs themselves because I think one of the things is you have a lot of celebrities at these clubs and I know privacy is mentioned, but I'm going to mention some names because this is all public information. I'm not disclosing but you guys like Michael Jordan and Tom Brady and Bill Gates and the Google founders. I mean it's everybody. You have the Kardashians and again this is public. I'm not sure anything Justin Bieber, but you're selling cool in some regard, aren't you? I mean it's luxury, it's cool, it's family. But people want to be cool.

[Mike Meldman]

Yeah. And it probably goes back to my college days in the beginning because like I said, I was the history major, the non nerd, you know, probably the. I always say I was probably the dumbest guy at Stanford because I was the only one who went into, who went into real estate because everyone Else went into technology, but I always like had the big parties, the fun parties and was kind of always turning my nerdy friends into fun friends. So that was kind of who I was and how I started. And I think discovery now because the brand's gotten so well known and big that it's become aspirational for a lot of people. Whether you're a businessman, an athlete, a movie star, whoever you are, own a truck company, whatever you do, I think it's become a very aspirational, not only investment, but part of people's life.

[Host]

Let's talk about the financing of one of these clubs. At the beginning you took on debt, now you don't have to take on debt, right? There's 15,000 members or so.

[Mike Meldman]

We never took on debt. And that's the pride, the reason we survived. I was always a believer in equity and land because land can become very illiquid and the land cycles go up and down. And even though we create things pretty quick and sell pretty quick, so we kind of get in and out or at least have enough success that when a downturn comes that we're okay. Even though like 08, even with no debt, it was hard because our markets slow down, they become very inelastic, which means no one's buying at any price and so you just have to wait it out. And 08 was probably an 18 month cycle, which doesn't sound that bad, but when you're going through the 18 months it was pretty bad and difficult. But since we had no debt, we were okay, we survived it and we ended up buying Yellowstone because of it and McKenna and some great projects. So we try to stay away from debt. We probably should use debt more to build quicker, you know, to get more houses built faster on our account. But I've always been not wanting to put that on just because when you do have a downturn there's no way out.