086 | Unique Business Opportunities In Real Estate | Capitalize On Hidden Opportunities | Tron Jordheim

Today our guest is Tron Jordheim. Tron has a long track record of sales, marketing, management, and contact center innovations. He’s in the business development field. He’s a manager for store here and innovative Self Storage company with its own call center, which owns and operates sites and manages storage for others. Tron also offers to consult about call center sales and marketing programs he advises on new projects and fine tune operations. As a CMO and Senior VP, he led SEO, SEM, interactive mobile, social media, version science data analytics call center and sales initiatives. Wow. His team’s projects and efforts have created billions of dollars in revenue.


So welcome, Tron, we are so excited to know your story and learn from you.


Oh, it’s a world so fun to be with you manuj. I should appreciate you taking the time. So I’ve created billions of dollars, for other people. I haven’t quite gotten to the billion dollars for myself yet. I’m a few zeros short. So I’m working on it.


I know the feeling I know the feeling.


Right. So that’s, that’s one of the honors of being middle and upper management and an entrepreneur kind of person is that you have the pleasure of creating wealth for other people. And when the projects work out, well you create a little bit for yourself. You’d like to work out to where you create a lot for yourself. So we keep plowing forward, right? That’s what we do keep ploughing forward.


Now right there with you. And a lot of in a lot of people in our audience are right there with you as well.


Right, right. And so you can tell I get bored easily because I’ve been involved in all kinds of things. And, and I love to learn. So anytime there’s something new, I’ve got to poke it, I’ve got to play with it. And I’ve got to see what I can do with it. And, you know, I’m not as smart as a lot of people out there. But I sure do like to play with things. And, you know, a lot of times you figure out some really cool stuff, but it has no application to the current project. So you just kind of forget it and keep moving and then find the next interesting thing. So yeah, it’s been a lot of fun.


Great. And I’m, you know, very amazed that you started your entrepreneurial journey very early, like the first business that you started what was in sixth grade? Is that right?


Yeah, yeah. So a lot of my friends, worked at grocery stores, sacking groceries or riding the delivery bikes. And, you know, everybody needs money, right? So I thought they worked awful hard for very little money. I thought that doesn’t make any sense at all. And I lived in Brooklyn, New York at the time. And in those days, there was so much business done locally, the local business Street was just full of small offices, small retail shops, small grocery stores, and they all employed window cleaners. And I looked at all the windows, I thought, well, you know, I can reach all of that with a stepladder. Why don’t I go see what I can do? So I went and stopped in a bunch of businesses and just said, Hey, I’ll clean your windows for you for less than you’re paying now. And you know, everybody thought it was so cute that the kid was trying to hustle a little, a little bit of a living. So I ended up with the nice window washing route. And did that for a while to like a board of it, which, you know, so my first caution to your entrepreneurs is if you have a nice business model, and it’s boring, please fall in love with it, don’t kick it to the curb. Because that is and I stuck with my window washing business, I probably have, I don’t know, 500 franchises by now because it was an easy business. All you had to do is work on the windows long enough to make sure there were clean and say thank you with a smile. So it was an easy business. But I got bored and moved on to other things. Right. So that’s also the entrepreneur’s dilemma, right? Yeah, for sure. A lot of fun. So and that taught me a lot about selling, right, all I had to do is come in and be nice and ask and enough people would say yes, that the project work. So that was really fun. And so that was kind of my first real experience. And ever since then I’ve been doing all kinds of things depending on what I was interested in at the time, or, you know, here lately since becoming an adult, I realized that there’s also you know, you should stay on a good path. And you should develop your connections and not just kind of bounce from whatever looks like fun for the next thing. That’s fine to do when you’re 16, 20 whatever. But so.


yeah, that’s a very meaningful lesson right there. But tell me a little bit about your talk process, then like, what are you not intimidated with the, with the height and going and talking to these people and negotiating these deals that at such a young age?


I guess not. I mean, I was kind of a cocky kid, you know. So I guess, I guess it didn’t bother me, I just went in and said, Hey, I can wash your windows for you. And whatever you’re paying now pay me a little less, and I’ll take care of before you. And I had enough people just go. Okay, so. And I didn’t need a whole lot of tools. Really, I just did it with a kind of window cleaner and a roll of paper towels. And none of the windows were higher than maybe 10 feet. So I wasn’t really going up very far. I didn’t know anyone who had any high work. I said, No, I can’t do that. Because I had no idea how to do it. And I couldn’t have afforded the tools if I knew how to do it. So you know, there, I learned a little lesson about staying in your lane, or whatever you call it. So I could do the low windows. I’m not doing the high windows.


smart idea. Okay, great. And then you have 30 love for dogs, and you started a canine training business. Tell us a little bit about that.


So that was a lot of fun. I’ve always loved working with dogs and being around dogs. And so you know, I watched it, I don’t know if any of you are listeners or your viewers have ever seen the Rin Tin Tin series. If you don’t know what I’m talking about, go look up on YouTube. It was you know, every little kid’s dream to have a magnificent German Shepherd in when I was coming up. So I found some people who bred German shepherds and trained him and I thought all man, this is so cool. So I got into it and stayed in that business for a long time training dogs buying and selling dogs breeding dogs. I was one of the people who early on in this sort of development of dog business, imported dogs from Germany and Austria Hungary, brought them into the US finished some training with them. And then they went on to either police departments or private people who wanted really nice protection, dog pets and things like that, that was a lot of fun. Did that for a long time. But you know, then it was time to move on. And sort of two lessons I learned there. One is that you can grow yourself broke. I was doing enough business that I expanded my business somewhat and really got to the point where I couldn’t support the expansion anymore with how I was doing it. And you know, you can’t do that you can’t you people grow themselves broke. So you got to be careful not to do that. And the other thing that happened was, I had no backup plan, in case the economy turned against me. And what happened was, this was I was doing a pretty nice business around the time, when the exchange rate between the German mark and the US dollar changed dramatically. And it almost doubled the cost of the dogs I was buying. And my my biggest profit margin was coming from so fairly inexpensive dogs compared to the rest. So I couldn’t make a profit on those anymore. So you know, the economy turned against me that can happen. So you should always have a backup plan for what if the economy turns against you? I had no control over the exchange rate that was between Reagan and Billy Brown, or whoever was running Germany at the time. Right. So So those kinds of things happen to people a lot. Yeah, you know, you things are going pretty well. And then the conditions change. And you go Oh, I don’t have a way to fix that.


Yeah. So do you. Now looking back, do you think there was something that you could have done to protect yourself? Or, you know, the first point that you raised you grew so so much rapidly, but you could not sustain the growth? So are there any lessons now looking back that you could have sort of implemented to protect yourself against those issues?


Oh, definitely.

I could have done a different model and how I was doing things I could have added a second phase to my business that was not reliant on the exchange between European dogs and the US. There were things available to me, but I didn’t find them interesting. So I didn’t pursue them. And I should have had a mentor who knew something about business. I could guess what a cash flow analysis was, you know, for me at the time, my cash flow analysis was, did the wad of cash in my pocket, give me the ability to buy a nice dog if I found one, and the owner wanted to sell it right then in there, right? Because that’s how I found a lot of nice dogs. I just meet someone and they had a nice story, and they couldn’t keep it and we quickly come to an agreement and I buy it right then. So that was my concept of cash flow analysis. You know, I discovered some years later. Yeah, it’s a little more involved in that. So I had a mentor who actually knew about business, they could have looked at the growth I was having, and the income I was generating. And they would have said, you know, this is a nice little business, we have some ways to, first of all, make this sustainable, make this last in the long term, build in some backup, maybe, you know, find some ways to build up reserves quickly. So someone who knew something about business management would have had a lot of fun because it was a nice little business. But I didn’t have that at the time. didn’t really know I needed to do that at the time. And you know, I was a stubborn, cocky kid. And maybe someone tried to give me advice. I don’t remember. I might have just blown them off. So


yeah, well, that happens.


yeah. Yeah.


And then, in this phase, you also helped NYC to build up their Canine unit. Is that right?


Yeah. So so there was a lot of things happening in the dog world at the time, and New York City decided it was going to reestablish your canine program. And so I was one of the guys who helped get that going by donating a bunch of dogs to them and offering some training support on the side and things like that. And, you know, sometimes I’ve been ahead of my time, you know, at the time, that was just kind of getting started. But there’s not a small town in the US today that doesn’t have two or three canines on the police force. So, you know, I was a little ahead of myself, maybe. But that was a lot of fun to see that develop. And they turn that into a pretty nice program. So exact, that’s fun.


Movies now these days, huh?


Right, right.


Okay. And then moving on, you went into the bottled water business, then?


Yes, yes. So. So I thought to myself after the dog thing, you know, I probably need to, I probably need to go do something else. Because that, you know, that’s didn’t happen. So I looked around and thought, Well, apparently, I’m pretty good at selling because I can seem to be able to sell dogs and sell training programs pretty well. I must know how to sell anything. So I should really go learn how to sell correctly. What’s it What’s an interesting business that people need? And so I kind of looked around, and I stumbled upon, you know, the bottle water business. I mean, I knew it existed. But I thought, My gosh, what a great business for New York City. All those old buildings have crappy pipes and lousy tasting water. Even if the New York City municipal water is great. When it leaves the reservoirs by the time it comes out of the tap. Yeah, not true, you want to drink. And at the time, you know, we think today that we do nutty stuff, without thinking of environmental impact. But at that time, there were buildings in Manhattan, whose drinking water was part of the AC circulation system to cool the age fact systems. So they ran the drinking water, through the H fact systems to cool the age pack systems before it came out at the tap. So I’m not even sure what you were drinking there. So anyway, I thought why not I could do this. So I had some great mentors at the Great Bear water company who really taught me how to do cold call selling. And, you know, this is just not available to most people today. So what we would do is we’d have to go knock on at least 50 doors every day. If you make 15 new cold calls every day, then numbers would work out that you sell enough new accounts that you do. Okay. And so that’s what we did, we chat out a piece of the city that we worked. And every day we went out and canvass the new building or an old building. And, you know, in doing that, you’d make some connections. So I had a whole long list of all of the building maintenance and security guys in the big buildings. So when it was time to work those buildings, I just go in and go see my guy in the building. And he said, I have two new tenants for you, you know, office a office be I’d go up selling, give him his split, and I’d be out of there. So it was fun. We built up a nice business. And go ahead.


No, but you’re just telling the story so how, how did it grow and what happened?


Well, so that whole business grew nicely enough that you’ve heard you maybe you’ve heard of KKR, the private equity firm that buys up all kinds of companies. So they bought Great Bear from the family. And then they spun that off to I don’t know who they spun it off to, and then they spun it off to the Perrier group. So at the time, the Perrier group was buying bottled water companies all over the United States and springs all over the United States, because they saw how big their bottled water business was in Europe. And then they saw that it was starting to grow in the US. And over a few years time they consolidated and bought up so many water companies, and ours was one of them. And so another cautionary tale is that you know when you’re an employee, and you’re on a roll, you have to watch the news because when the company gets taken over changes will happen. And it was a very different style. When that when the original family ran the business, they wanted to make sure that the sales people and the bottle water delivery people all made a really good living because for them turnover was painful. Right, when the new company took over, they came in and they told us all you guys make too much money. We’re firing you all right. Nice. Okay, well, see ya. So that kind of stuff happens all the time, too. And unless you prepared for that, yeah. Then you know, you have a bad day, and then you figure out what the next thing is going to be. So and that was that that was a big change in what happened in the bottle water business?


So then what is the lesson that you learned? What could you have done to protect yourself from that situation?


Well, so one thing that I could have done to protect myself was to take all the bonus money and invest it and things that we’re going to grow. Yeah, right. Wearing said, I was under the false impression that I wasn’t making enough money to be an investor, where, and that has changed today with some of the tools available to you now with some of the investment apps and some of the investment programs. You can be an investor with $5 now, and at least get started. Right. So those kinds of things weren’t really available. And for folks like us, who were, you know, the sales guys? Nobody had any kind of programs available, that wasn’t sounding like scams, right? People had ways and they were working on things, but when you went to visit them, this doesn’t sound good. And you couldn’t find the people who were in the programs, who had long term success. So you, you’d have to walk away because they couldn’t prove that it worked. Right. Yeah. Anyway, that is different today. Today, you can be an investor class with five bucks. So okay, my other cautionary tale is investing a little bit as soon as you can and keep investing a little bit because otherwise, you get to the point where you go, Wow.

I missed out on a growth spurt there.


Yeah, exactly. What is your favorite investment waco right now?


So I’m a self-storage geek. Right? So I’m involved in a few Self Storage projects that I liked very much because those are, those are both operating businesses and appreciating hard assets right at the same time. So I like those you, not everybody, you know, is probably should be doing things they don’t know that much about. So then I love playing around with all the little investment apps that just make it really easy to invest, you know, $50 here hundred dollars, they’re just going keep you know, plowing a few things into this that the other thing? Yeah, I don’t know what the next Google or Microsoft is going to be if I knew I would. I don’t know if I tell you if I knew, but I don’t know.


I just meant whether it’s stock market, whether it’s cryptocurrencies, like nothing specific, but you know, just kind of general vehicle for your investment?


Well, I think the smart thing to do is to dabble in a little bit of everything. I think that’s a smart thing to do. And then you know, focus on things, you understand things that you can see the horizon of what’s happening with them. Yeah, I think that’s important, you know? Because otherwise, maybe you do, okay, maybe you don’t? And then it just depends on when you need your liquidity. And what cycle you need your liquidity if you need it at the wrong time, then it wasn’t that fun for you.


So let’s talk about storage. Sure. How did you get involved in this business? And how far apart from the water business to this new business? Was the gap?


So that’s it? That’s a good question. So I saw the gap in, in how it works is very, very short. So I got involved in the Self Storage business because I was working for another bottle water company here in Missouri and thought it might be time to go do something else. And there were some local guys here in town who had built up a very nice Self Storage business, and they were looking to create a call center. So a contact center, that was going to serve the industry as outsourcing. Because what people discovered was that if you had someone answering the phone for yourself storage property, who knew how to create leads, man, your sales went through the roof. This was a period in the Self Storage business where it went from a very passive sort of the people running it basically all they did was collect rent and went from that to becoming a sales organization. And so I was a part of that whole transition. With the call center we built up we helped flip the Self Storage business on its head, because all of a sudden, it became a sales marketing game, where before, it was not. Yeah, and, and so based on that, as that the company grew, I got more involved on the Self Storage side, and then really took over the marketing for the company, at about the time when the internet was starting up, so I got to, you know, be part of that whole wild west thing before there was any barbed wire, you’re there already towns, you know, we were out there chasing cows around. And that was pretty fun and pretty crazy. And that ends. And you know, based on that, if you look at the Self Storage business now, it’s an online business, right? It’s become a digital business, where there’s a physical component. So it’s, it’s pretty fun.


So what is the root cause of the growth? Is it you know, is it people buying stuff, they are, you know, hoarding too much stuff, or what’s going on there.


So I think a couple of things happened. So in the, in the 70s, when Self Storage really started taking over, there was a couple of thing happening there. As the Vietnam War wound down, lots of people came back, lots of people moved, so they had to store their stuff places like the, as the military kind of scaled back a little bit. At the same time, the baby boomers were starting to get stuff. And most of their parents had lived through some very lean times. And so so some of the reaction of baby boomers was we never had stuff when I was a kid, my parents never had stuff. So I’m going to go get stuff, you know, I’m going to get toys, I’m going to get possessions, I’m going to get neat stuff. And at the same time, advertising started getting very sophisticated. And inflation started making it look like we all had more money. And so people started collecting stuff. And then inflation made it look like real estate was a great investment. And people started buying and selling homes more and jobs started moving around. So we had a lot of movement to people. And that just kept growing. And, you know, now we’re at the point where, you know, people in there, you know, 40s 50s, or whatever, they’re in the sandwich, right? If they’ve got parents with a lot of stuff, you know, something has to happen with that stuff. They’ve got their own stuff. They’re holding stuff for their kids, maybe their kids have given them stuff to hold, right. So there’s a lot of just a lot of stuff out there. And it’s got to go somewhere. Plus, you know, most people are living in smaller homes, apartments than they did 10 or 20 years ago. So they need an extra storage closet and extra storage room somewhere for their seasonal stuff for just whatever they’re holding for later. It’s really fascinating.


Yeah, no, I can relate to that I have a full basement of stuff that I have no idea what to do with.


Right, right. But you don’t want to get rid of it, because you’ll need it right? Yeah.


Well, slowly, I’m trying to get rid of it and letting go. But tell me a little bit about this. Now, you know, store Self Storage sounds like a very unsexy business, you know, very sort of traditional old business, but still a profitable business. You know, it’s fascinating, nobody’s like, the lot of people probably do not understand this business. And from what you’re saying sounds like it is quite a profitable business.


Well, it can be if it’s done correctly, but like so many other profitable businesses, it’s also easy to mess it up. So and it’s also really starting to mature. So if you look at the big public companies that do self-storage, and almost all of them do it really well, some of it do it extra really well. Their net, operating income growth is somewhere between two to five to 6%. That’s not crazy growth. Now, that’s very respectable growth. But during some of the boom times of self-storage, when supply could not nearly satisfy the demand and markets and where real estate prices allowed us to go in and build some really nice properties at some, in some fantastic locations, and busy, busy metro areas. In those times, there were people getting double digit net operating income growth year over a year. That’s, that’s impressive. So now, it’s ratcheted down to where it’s just normal, profitable business, okay? Now, there’s still people who are finding value add properties are finding properties, they can, you know, figure out how to tweak and they’re still doing very well with them. But those are fewer and harder to find. And it takes a lot of skill and knowledge to do that. We’re kind of at the phase in self storage now, where there are new people coming in people who are maybe flipping houses or had some apartments or things like that, and they’re coming into Self Storage, thinking, it’s going to be, you know, the next big kaboom, those, those folks have to be careful because they don’t have the resources to weather, the things in the economy, they don’t have control over or they don’t have the resources to whether a mistake that an expert wouldn’t make those kinds of things. So that’s kind of where we are now. It’s still a very good business, and it’s going to continue to be a good business because people will still have stuff. You know, that’s, there’s their stuff.


And one point you brought up was, now it’s turning into a digital business with a physical component. Could you unpack that statement for us? But what do you mean like it?


Yeah. So. So most of our transactions take place, in the digital world, most of our customer contact and customer management takes place in a digital world. But there’s a physical component because they’re, they’re actually renting a space someplace. So they’re not, you know, just downloading another app to play with, right? They’re not just downloading a component to a game, they play online or whatever. There’s actually a physical component there. But the majority of our business is transacted on mobile phones, through our apps and things like that. So it’s, it’s interesting to see that


I see. I see. So let’s say if somebody wanted to start a business in this field, how will they go about doing that? Like, you know, do you are you had the liberty to share some ideas? let’s say somebody wants to start a storage company, how can they get the first down all that?


Well, so so the thing to do really, is to find somebody who’s a self-storage consultant, whether it’s me or somebody else, go find somebody who knows what they’re doing, and make sure that this project is going to work. So you’ve only got a couple of ways to do it, you, therefore, buying an existing property, you have to find a building that suitable to be converted into Self Storage, or you have to start from the ground up and build a new one. All three of those are fraught with risks and full of opportunities. And it and it just really depends on a lot of different factors. Like, where are you planning to do this? What’s that market look like? What’s the potential to grow it? How are you going to run it? Right? And very, very importantly, how are you going to finance it? Because many times nice projects fail, because of the way it was financed, and the way that financing was structured. And sometimes you’ll see a project and you think, my gosh, that thing is ugly? Who would want that? And then you check it out? You go, Wow, that is a money maker. And they finance that in a very clever way. And those are some smart folks. Right? So you don’t always know driving by what you’re looking at?


Yeah, for sure. And yeah. And so you know, there’s a real estate component attached to this. So I was, I would assume that, you know, financing could be a little bit easier, because there’s a secured loan option and stuff like that, or, as compared to like, a totally hundred percent digital business where, you know, it’s generally just an idea on paper, or how does that work?


Right. So you do have the real estate as, as some solid components, some solid asset they’re loaning against, but primarily what they’re loaning against is your future income. So it is an interesting mix between operating business and real estate assets. So and you’re basing your estimates and performance and promises based on future income. And if you get that guessed wrong, then then it becomes tricky.

What are you going to do? If you can’t make the note, you know, what are you going to do? That’s tricky. And it doesn’t happen much. I’ll say that the default rate in self-storage is far lower than it is in every other real estate asset class. But it still happens, and you wouldn’t want it happening to you, cuz I’d be a bad day.


It’s not right now. Now, let’s talk about passive income because a lot of people want to buy or run businesses where they can be a fan. So is this that type of business or where you can, you know, hire employees and have them run the business or you have to be really involved in?


So it depends, it depends on how you run it. So if you buy a project, that’s big enough, you can hire a third-party management company like our guys, and we’ll just run it for you, all you have to do is kind of look at the reports every month and ask a few questions. If you buy a smaller property, it’s to it won’t support that. Now you’ve got to figure out how to run it yourself, do you have an employee or partner helping you with that? Do you do it all yourself, there’s a lot of really good technology tools to help reduce the headache of doing it yourself. But if you’re going to do it yourself, you got to have some guidance, or you’ll make a lot of mistakes, and you will not enjoy it. So so there’s a there are different ways to do it, depending on the size of the project, where that project is and really what your goals are for it. So it’s still the kind of thing that some people will buy as their you know, as their retirement thing.


They’ll buy it, and run at themselves for a while until they’re tired of doing that, then they’ll get a part time helper too. So they don’t have to devote a lot of time to it. And you know, when they’ve when they’re done, and they don’t want to spend any more time on it, either sell it or pass it to their kids or something. So it can be done like that. Or it can be done as a passive investment where you have somebody else run it for you. It’s just one other thing in your portfolio that can be done to and then sometimes some people run it as there, that’s their part time thing. They work a full-time job doing whatever they’re doing. And then they spend a couple of hours every day on their storage project. So there’s a lot of ways to do it. Just, you know, like anything else. If you do it wrong, you know, you won’t like the bruises. So, for sure.


So that’s amazing. Thank you so much for sharing this information with us. Now, if somebody in the audience wants to get in touch with you and maybe discuss the opportunity to, to open a story unit, how can they get in touch with you?


Yep, so you can find me on LinkedIn. I’m there, that’s easy to find. You can find me at Jordheim consulting dot com. Or go to store here, just like it sounds store here dot com. So there’s a couple of ways Find me on LinkedIn. Go to Georgetown consulting or find me at the store here. And be glad to help you with any of that.


Great. Well, thank you so much for being with us today and sharing this knowledge about the file storage unit. They have been very fascinating.


Well, thanks for letting me go on and on.


Links & Mentions From This Episode:


Tron’s Website:  https://www.storehere.com


TetraNoodle consulting services: https://bootstraptechstartup.com

TetraNoodle professional training: https://courses.tetranoodle.com

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