RElationships: Q&A with Proper Pivot’s Founder, Justin Melendez

Justin with his wife Pamela and daughter Audrey

Justin Melendez is an active duty Army warrant officer, real estate investor, and founder of Proper Pivot, LLC . He has experience with buy-and-hold investing, short-term rentals, and flips, with a focus on the Fayetteville, North Carolina market. He lives in Augusta, GA with his wife Pamela and daughter Audrey. 

What is your ‘why’?

The military has been a demanding job for me over the last 10 years with training, overseas deployments, and unpredictable schedules, and will continue to be demanding until I retire in roughly 10 years. So it’s important for me to earn passive income to give me more free time with my family. I have a wife and one daughter right now, and potentially more children in the future. I don’t want to have to do a W-2 job to support my family and trade time for money. I want to earn money on my own terms. 

How did you get started in real estate?

My wife and I bought our first property in North Carolina in 2013. We started out living on base like many others were doing, but we wanted the opportunity to put our money towards something that could grow, rather than just give our housing allowance to base housing. We lived in that first property for 3 years but realized we needed something bigger so we looked into selling it, but the home’s value did not increase enough for us to break even on the property. This encouraged us to look into renting the property. We realized we could rent out the home for a few hundred dollars more than our mortgage payment so we decided to rent it out instead of sell the home. 

Around this time I was introduced to Dave Ramsey, the personal finance radio personality. He stresses the importance of controlling your spending, having a budget, and limiting all debt except for your home mortgage. Soon after that, I was introduced to Bigger Pockets by a friend at a going-away party who owned several out-of-state properties, and it was that intro to the Bigger Pockets world that really set off a spark for me to learn about real estate. Chad Carson’s book “Retire Early with Real Estate” was inspiring for me as well. 

Why did you start your real estate company: Proper Pivot?

Starting a real estate/investing company was never something I dreamed about or wanted to do. I never even considered a career in real estate when I was younger. However, I realized after I did my first flip that I should form an entity to do business correctly. It was a profitable flip, but the finances were messy and I should have structured it in a way to protect myself better. Since it was successful, I wanted to do more flips, and I knew the right thing to do was to form an entity and go through the process of learning how to start and run a business successfully. Proper Pivot is a reflection of my family: me and my wife and my daughter investing in real estate through this company. 

How did you decide on the name Proper Pivot?

I’m an IT nerd by trade: computers and networks are my thing. In cyber-security, a pivot is when you move laterally within a network. The name is a reflection of this concept and how that applies to me and my family. There are so many ways to be successful in real estate, so I wanted to keep that concept in mind when we created Proper Pivot. We will continue to adjust and be flexible throughout this journey to be successful and achieve our long-term goals. Regarding the Proper Pivot logo, I knew I wanted a nerdy spin on that concept and apply it to real estate, hence the glasses and house in the logo. 

What software or tools do you use in your business that have provided significant value to you?

I have a list of tech that Proper Pivot uses in the business. If I had to narrow that list down to two that provide the most value, the first would be REIReply. It has provided the most monetary benefit for us since we started using it. We have acquired 3 properties with REIReply – one we kept as a rental, and two we have wholesaled to other investors. (REIReply is a marketing platform used by wholesalers and real estate investors to source leads with motivated sellers. Features include text messaging, cold calling, ringless voicemail, email, and it has a robust CRM (customer resource management). 

Also, Dealcheck.io is a great website and app we use to analyze properties. We can look at comparable properties, the report generation tool is more aesthetically pleasing than many other websites that do this, and it’s relatively inexpensive. The app is highly functional too, so we can drive around neighborhoods, plug in our numbers, and get a clear idea very quickly of whether a property will work for us or not. 

Dealcheck.io actually helped me lock up a deal in a matter of minutes. A wholesaler had just listed a property on Facebook, so I messaged him about it and he gave me the code for the lockbox. I went over to the property and looked it over, ran the numbers through the dealcheck.io app, and sent him an offer which he accepted. If it wasn’t for that app, I wouldn’t have been able to act so quickly on that property. 

What do you want your legacy to be?

The term ‘legacy’ seems profound, but put quite simply, as the son of an immigrant and a product of the lower middle class, I aspire to influence the culture within my family as it relates to wealth and money. Ultimately, I’d like to build off of the hard work that came before me and continue to put this family in a better position to succeed and be free. If it all goes right, and I have some cycles to spare, hopefully I leave valuable assets behind for my children to leverage. 

I hope you enjoyed this interview with Justin Melendez, founder of Proper Pivot LLC. Make sure you check out his website and follow him on Instagram and Facebook @properpivot!

Should You Join a Mastermind Group?

About one month into my Iraq deployment last year (2019), I got an email from a friend about a real estate-focused mastermind group for military members and veterans. I found this intriguing, as I had recently read the book Tribe of Millionaires by David Osborne and Pat Hiban (of the Gobundance mastermind) which outlines the benefits of a mastermind group via a fictional story. Surrounding myself with like-minded individuals of a similar background for the purpose of self-improvement sounded appealing to me. I’m always interested in bettering myself and learning more, so this seemed like a logical next step in my personal development. I told my friend that I was interested, but I wouldn’t start it until I came back from deployment. Fast forward a few months, and I submitted my application and joined the mastermind.

It’s been roughly 10 weeks since I started, so I thought I would give some insights into what it’s like being in a mastermind group. Members are divided into 5-6 person ‘squads’ who are encouraged to meet weekly to discuss highs and lows of the previous week, long-term goals, and short-term goals for the week ahead. One person gets to deep-dive into what they’re working on and any problems they’re facing. These are usually in the context of real estate and personal finance, but we discuss fitness goals and work problems as well. In addition, there are roughly twice-monthly webinars for the entire mastermind with more experienced speakers from different real estate backgrounds. These provide a tremendous amount of value because you can ask questions and interact with these individuals.  

So What Are the Benefits?

Accountability

This is a huge advantage to being in a mastermind group, and it pays off regularly. Once you are in a squad, you lay out all your goals – short term and long term. My squad helped me realize that I hadn’t set my goals high enough, so I made bigger goals. This reiterates the fact that we are only restricted by the limits we place on ourselves. I couldn’t see this fact myself, but these guys showed me that I could accomplish more.

When you outline your goals for the upcoming week, your squad members will follow up with you during the week and make sure you’re actually doing what you said you would do. Also, the beginning of the weekly meetings involves discussing if you met your goals from the previous week. Some of my past goals have been reading 50-100 pages per week of any book, exercising daily, and reading an article about real estate syndication every day. What good is a goal if there is no follow up to ensure it has been achieved?

Networking

“You are the average of the 5 people you spend the most time with” said Jim Rohn. Networking is probably the most substantial long-term benefit to a mastermind group. Our mastermind in particular has a good mix of beginners and more experienced real estate investors. Some are into lending, some fix-and-flip, some prefer the simple buy and hold strategy, and some do all of those! You also have a wide array of people with experience in different asset classes, such as single family homes, apartment buildings, self-storage, mobile home parks, and more. There seems to be a healthy combination of people looking for deals to invest in, and people with deals that need capital to get started.

Personal Development

Many people join masterminds because they have a good idea of what they need to do to get moving in the right direction, but they just need that bit of encouragement from like-minded individuals. It’s also a fantastic forum in which you can bounce ideas off of others. The group is diverse enough such that whatever problem you’re having, there’s probably someone else that has had a similar experience. Or they’ve read an article/book or listened to a podcast about it.

Is A Mastermind for You?

As with life in general, the more effort and time you put into your mastermind experience, the more you get out of it. Some members are more involved than others, and there is a direct correlation between time spent and value gained. On a similar note, the more you give the more you get. If you are willing to give to others (be it knowledge, time, or money) the universe will pay it back many times over. It’s also inherently rewarding to help others and see them grow. Though it is certainly not for everyone, I have personally enjoyed the mastermind experience so far, and will continue to participate as much as I can in the future.

Have you been in a mastermind group? Tell me your thoughts in the comments section below. Also, the War Room Real Estate Mastermind Group is always looking for military members and veterans who want to learn and grow and help others. Send me an email to learn more.