Episode Overview
Podcast: Real Estate Investing School Podcast
Episode: 151. Mastering Storage Unit Investments with Ben Gottfredson
Date: April 22, 2024
Guest: Ben Gottfredson, Visionary of Big Ben’s Moving & Storage and Big Storage Ventures
Host: Joe Jensen
This episode explores the world of storage unit investments through the entrepreneurial journey of Ben Gottfredson. Ben shares how he transitioned from running a moving company to building a thriving storage syndication business. Listeners gain insights into why storage is more akin to running a business than traditional real estate, the value of partnerships, meaningful lessons from setbacks, and strategies for resilient growth in real estate. Ben also emphasizes system-building, the importance of mentorship, risk management, and the unique power of commercial real estate.
Key Discussion Points & Insights
1. Ben’s Entry into Real Estate & Storage (02:11–04:42)
- Starting Out: Initially ran Big Ben’s Moving in Southern Utah, expanded to Northern Utah, and house-hacked his first property by renting rooms (making a profit and gaining experience).
- Storage Opportunity: Realized the demand for storage through his moving business’ customers (04:05). Noticed he was losing business by passing up storage requests, prompting him to investigate owning/building storage facilities.
Notable Quote (03:27):
"I’m falling in love with real estate. My mortgage is two grand, but if I rent this thing out by the room, I can gross four grand and have a place to live... I had six figures in equity in less than a year." – Ben (A)
2. Business vs. Real Estate: The Storage Model (04:42–06:36)
- Business Hybrid: Storage shares traits with both real estate and business. Beyond being a passive investment, storage facilities have operational levers, creative pricing, and competition factors to consider.
- Active Management: Unlike typical rentals, success in storage depends on occupancy management, local competition, and active operations.
Notable Quote (04:45):
"You have all the upside of a real estate asset... but you also have all the benefits of a business, too. There’s a lot of creative things you can do... a lot of things you can do actively to squeeze more juice out of it." – Ben (A)
3. Overcoming Early Challenges: Funding & Learning (06:36–09:15)
- First Facility Hampered by Inexperience: Learned about storage “the hard way,” facing over a dozen rejections from banks before finally securing financing.
- Lesson: Would now recommend seeking out a coach or experienced partner from the start to accelerate learning and avoid mistakes.
Timestamps and Quotes:
- (07:09) – "What I did was just—I beat my head against the wall... I went to every different bank in town... I got rejected over a dozen times, but just keep sticking with it and keep learning." – Ben
- (09:15) – "Now, right, I had a chance to look at that deal, the first deal... I could do one every three years... or I could put together a series of deals every single year... that’s a big paradigm shift." – Ben
4. Power of Partnerships, Syndications & Abundance Mindset (10:41–13:41)
- Syndication Explained: Ben now syndicates deals, often as a minority partner, to maximize deal flow and share opportunities.
- Abundance Approach: Willingness to pay for coaching and cut in other partners is key to scaling.
Notable Quote (12:00):
"We make it passive for them and just mailbox money... they can be as involved as they want, or just collect the check every month." – Ben
5. Deal Structure & Playing to Strengths (13:01–14:11)
- Multiple Roles: Partners can bring deals, provide funding, or contribute sweat equity. Everyone wins by focusing on their respective strengths.
- Scalability: By dividing roles, more (and better) deals can happen without overwhelming any one person.
Notable Quote (13:41):
"If people can focus on their expertise... everybody can just be better at what they’re doing instead of everybody being watered down, trying to do it all." – Joe
6. Mindset Shift: From Residential to Commercial (15:08–17:08)
- Commercial Mindset: Ben advocates for thinking like a commercial investor, even for those starting in residential. Understand that scaling requires systems and a business-like approach.
- Margin & Systems: Property management in commercial storage allows for higher margins and outsourcing, whereas “house hacks” often require more personal involvement.
Timestamps:
- (15:41–17:08): Detailed discussion on why commercial real estate offers better systems and scalability than single-family rentals.
7. Scaling, Systems, and Team Development (18:34–21:48)
- Freedom Requires Systems: Without proper delegation and systems, personal capacity becomes the limiting factor.
- No Plateau: Letting off the gas doesn’t work – continual scaling and refinement cycles are necessary for business health and long-term success.
Notable Quote (20:51):
"Businesses naturally need to be scaled, and they need to be... you have to have that growing period of scaling and then refining and scaling and then refining... flatlining and just trying to maintain has never really worked for me." – Ben
8. Resilience & Overcoming Setbacks (26:08–38:01)
- Longevity is Crucial: It’s not a get-rich-quick game—Ben notes it usually takes years (“four years of taking punches”) before real traction and big returns occur.
- Types of Setbacks: Details specific business and real estate setbacks—car accidents, lawsuits, betrayal by partners/employees, budgeting missteps.
- Margin of Error: Always design deals with a “margin of stupidity” to prepare for the unexpected.
Notable Quotes:
- (28:03): "It takes four years of taking punches before you can see something pop and really start to get passive and lucrative... it’s the person that’s willing to keep going. When bad stuff happens... keep getting back up—that’s what sets people apart." – Ben
- (30:32): Examples of real business failures and pivots.
9. Stress Tolerance, Leadership, and Team-Building (38:01–42:21)
- Stress Muscle: Success in entrepreneurship means developing “stress tolerance” and focusing on triage—addressing what matters most, when it matters most.
- Leadership Evolution: Calm under fire becomes essential as your organization grows, especially with middle management and bigger teams.
- Emotional Mastery is a Learned Skill: Ben and Joe both reflect on not being naturally cool-headed, but having to cultivate it for their businesses to survive and grow.
Notable Quotes:
- (35:38): "You develop a stress tolerance, too. Now today, someone would literally have to die for me to get rattled... my stress tolerance is so high because I’ve practiced and hung in there." – Ben
- (41:33): "I would be…my business would not survive. It’s not really like a choice. If you want to scale a company…you have to develop that or else you die." – Ben
10. Opportunities with Ben’s Companies & How to Connect (43:07–44:12)
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Open Door Policy: Ben encourages listeners to reach out via DM, whether for partnerships, coaching, or collaboratively structuring deals.
- "DM Big Storage Ventures or my personal account... DM me your phone number and I’ll call." (43:07)
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Approach Matters: The value of working with experienced operators is stressed over “unqualified but eager” beginners.
11. Final Four Questions (46:22–57:31)
a) If Starting Over: First Three Moves? (46:22–47:49)
- Find the Deal: Skills in acquisitions bring the most leverage; finding deals gets you into rooms with serious players and capital.
- Operational Skill: Property management and system-building is a close second—vital for scaling.
Quote (47:22):
"Whoever has the deal...demands the gold... I'd be spending a lot of time on that because you can create value, wholesaling, partnering, anything if you can do that."* – Ben
b) Recommended Book/Podcast (49:06–51:32)
- Book: Traction (by Gino Wickman). The “operational Bible” for Ben’s businesses.
- Why: Implementation trumps motivation for serious investors looking to scale.
c) Expensive or Interesting Mistake (51:48–54:46)
- Mistake: Choosing service providers (architects, contractors) based only on lowest bid can result in costly delays and missed expectations.
- Lesson: Always bake a “margin of stupidity” into your numbers—never assume everything will go perfectly for a deal to work.
Quote (54:19):
"If you have to have everything go perfect for the deal to work, it's a bad deal." – Ben
d) One Word That Sums Up Why He Loves Real Estate Investing (56:21–57:31)
- Word: Powerful
- Explanation: Real estate’s unique combination of cash flow, equity, and tax advantages can transform someone’s financial life, enabling freedom and impact.
Memorable Moments & Quotes
- (04:45) “There's a lot of creative things you can do...there's a lot of things you can do actively to squeeze more juice out of it.” – Ben
- (12:00) “We make it passive for them and just mailbox money.” – Ben
- (20:51) “Businesses naturally need to be scaled...” – Ben
- (28:03) “It takes four years of taking punches before you can see something pop…” – Ben
- (35:38) “You develop a stress tolerance...now, someone would have to die for me to get rattled.” – Ben
- (54:19) “If you have to have everything go perfect for the deal to work, it's a bad deal.” – Ben
- (56:21) “Powerful. The power it has to really create wealth...that's the power of real estate.” – Ben
Timestamps of Important Segments
- 02:11–06:36: Ben’s origin story and storage as business & asset class
- 07:09–09:15: Challenges funding and launching first storage deal
- 10:41–14:11: Syndication, partnerships, and focusing on strengths
- 15:08–17:08: Why and how to shift to commercial investing
- 18:34–21:48: The necessity of systems for scalability
- 26:08–36:57: Resilience, setbacks, and realistic expectations
- 38:01–42:21: Developing leadership and emotional management
- 43:07–44:12: How to connect with Ben & Big Storage Ventures
- 46:22–57:31: Final Four Questions (practical advice, recommended book/podcast, most expensive mistake, “one word” summing up real estate investing)
Takeaways for Listeners
- Successful storage investing combines real estate fundamentals with entrepreneurial business management.
- Partnerships, mentorship, and an abundance mindset can 10x your opportunity and reduce risk/execution friction.
- System-building and stress-tolerance are core to scaling and sustaining wealth—both are learnable skills.
- Always structure deals and underwriting with contingency for the unexpected.
- “Finding the deal” is the fastest route into the inner circle of the industry, regardless of financial starting point.
- Real estate’s power is in its ability to free you for greater pursuits—with the right approach, almost anyone can participate.
For deals, partnership inquiries, or storage investing guidance, DM Ben Gottfredson at @BigStorageVentures or his personal account. As Ben says, “DM me your phone number and I’ll call.” (44:12)