Building Optimal

In this episode of Building Optimal Radio, I sit down with our most listened-to guest ever...one of the greats, builder and author David Gerstel. Now at 80 years old, David shares what decades in business taught him about running a successful construction company and living a meaningful life.Previous conversations with David Gerstel:#90: Financial Freedom with David Gerstel#58: A Builder’s Path to Financial Freedom with David Gerstel#19: Bidding, Estimating, and Achieving Financial Freedom with David GerstelBook recommendation:Small Giants: Companies That Choose to Be Great Instead of Big, 10th Anniversary Edition, by Bo BurlinghamEdit: Thanks to our friend Ian Schwant, of Nails to Numbers on Substack, for pointing out that the idea I attributed to Munger is actually called Hanlon’s Razor.A Special Thanks To Our Brand Partners:Subzero WolfQuaker WindowsHome Depot Pro Xtra ProgramAnd Be Sure To Check Out:Investnext (our platform to raise and manage investor capital)The Building Optimal Shop (for systems and processes to help run your home building company)

David Lupberger is a well-known construction industry veteran, consultant, and thought leader. We hosted him on the program in 2019 to discuss “client-for-life” strategies.Today he returns to discuss a very under-considered yet highly important topic: how do you one day sell or step away from your company? I hope you enjoy this enlightening conversation with David.For additional resources David has graciously shared with us:Leaving Your Business is Inevitable! | Remodel Force™https://contractor-transition.com/blueprintTo connect with David you can reach him at [email protected] Special Thanks To Our Brand Partners:Subzero WolfQuaker WindowsHome Depot Pro Xtra ProgramAnd Be Sure To Check Out:Investnext (our platform to raise and manage investor capital)The Building Optimal Shop (for systems and processes to help run your home building company)

The team at Cedar Build is innovating architecture in Austin and beyond. With a focus on small multifamily infill sites, Cedar has developed deep expertise both in how to optimize such sites and also how to leverage newest code and legislative updates for impact. Their team is also building out software with AI to help developers efficiently assess infill sites at scale across the country. Thanks for listening, and enjoy the episode!A Special Thanks To Our Brand Partners:Subzero WolfQuaker WindowsHome Depot Pro Xtra ProgramAnd Be Sure To Check Out:The Building Optimal Shop (for systems and processes to help run your home building company)Investnext (our platform to raise and manage investor capital)

In our inaugural Innovators Series episode, we visit with Oklahoma builder and developer, Austin Tunnel. Austin is Founder and CEO of Building Culture, a company building homes and urban communities designed to last generations. From his means of designing and building to the way he structures his deals for investors, Austin's approach is a case study in elevated real estate development.A Special Thanks To Our Brand Partners:Subzero WolfQuaker WindowsHome Depot Pro Xtra ProgramAnd Be Sure To Check Out:The Building Optimal Shop (for systems and processes to help run your home building company)Investnext (our platform to raise and manage investor capital)

In this mini-sode I *somewhat* disparage the real estate community, wannabe builder tech bros, and more. Hopefully you learn a few things to keep you safe and profitable while you're out there in the spec building trenches. Y'all have a great end to the year, and by the way, we have some video episodes coming out asap. Stay tuned.A Special Thanks To Our Brand Partners:Subzero WolfQuaker WindowsHome Depot Pro Xtra ProgramAnd Be Sure To Check Out:The Building Optimal Shop (for systems and processes to help run your home building company)Investnext (our platform to raise and manage investor capital)

I've hesitated to put this episode out, because I generally try to take an optimistic, encouraging tone. But we can't get better until we accept the reality of our situation. So, here's to each of us, and the building industry as a whole, staring reality in the eyes - and getting better. Wishing everyone nothing but success! Enjoy the episode.Also, we just released new products to take your home building company to the next level at the BUILDING OPTIMAL SHOP. Thank you to our amazing brand partnersSubzero Wolf CoveGrand Openings

At the most fundamental level, there are really only two strategies in business, and only one that works for small businesses. Most home builders get this wrong, and end up stuck in the middle, never generating the profits they should.In this episode Jared discusses the risks of getting your strategy wrong, and the opportunities once you find the one that truly sets your business apart.Also, we just released new products to take your home building company to the next level at the BUILDING OPTIMAL SHOP. Thank you to our amazing brand partnersSubzero Wolf CoveGrand Openings

Joey Fentress is the founder and owner of Proform Builds, a Seattle-based luxury home builder. Joey recently expanded his operation into Austin, where I was introduced to him and his team. The level of professionalism with which Joey runs his business is evident in just a short conversation, and it's reflected in the quality of their builds.This episode is a conversation with Joey about his in-house labor, and how he manages that aspect of his business. Enjoy the episode, and if you like this and others we have done, it would be a huge help if you leave us a review here in your podcast player. Thanks for listening!Also, we just released new products to take your home building company to the next level at the BUILDING OPTIMAL SHOP. Thank you to our amazing brand partnersSubzero Wolf CoveGrand Openings

A quick 7-minute episode to help you make more progress and find some big wins in your business. Credit to Tim Ferriss for his recent blog post on the topic, the inspiration for this episode.If you enjoy listening to the podcast, please do us a favor and leave us a review on Spotify or Apple! Also, we just released new products to take your home building company to the next level at the BUILDING OPTIMAL SHOP. Thank you to our amazing brand partnersSubzero Wolf CoveGrand Openings

We've been obsessed for over a year now with different AI apps that can help home builders. This is an extremely short episode on the best we've found. Enjoy!If you enjoy listening to the podcast, please do us a favor and leave us a review on Spotify or Apple! Also, we just released new products to take your home building company to the next level at the BUILDING OPTIMAL SHOP. Thank you to our amazing brand partnersSubzero Wolf CoveGrand Openings

This is one of the most inspiring episodes I've recorded. I have mentored Joe Hodge over the last few years as he set out on his dream to start his own home building company. Starting alone is difficult enough, but the market forces over the last few years added major complications as Joe came out of the gate.But Joe is a fighter (literally and metaphorically), and built a resoundingly successful project even with serious headwinds. We visit on both his wins and his lessons learned from this first of what will surely be many successful projects as Joe grows his company.Enjoy the episode!If you enjoy listening to the podcast, please do us a favor and leave us a review on Spotify or Apple! Also, we just released new products to take your home building company to the next level at the BUILDING OPTIMAL SHOP. Thank you to our amazing brand partnersSubzero Wolf CoveGrand OpeningsQuaker

Gossett & Co recently closed two construction loans with Arixa Capital, and sat down with executive Greg Hebner and his team during their visit to Austin. The group discusses the Austin market, California immigration, the latest market and financing trends, qualities of a good lender, and more. Thanks for listening.If you enjoy listening to the podcast, please do us a favor and leave us a review on Spotify or Apple! Also, we just released new products to take your home building company to the next level at the BUILDING OPTIMAL SHOP. Thank you to our amazing brand partnersSubzero Wolf CoveGrand OpeningsQuaker

This is the final installment of our series on Charlie Munger, an episode devoted to the memory of the late investor who recently passed away. In this episode we cover the reason to read, the need to get into a great business, and the only way to run a good company.If you enjoy listening to the podcast, please do us a favor and leave us a review on Spotify or Apple! Also, we just released new products to take your home building company to the next level at the BUILDING OPTIMAL SHOP. Thank you to our amazing brand partnersSubzero Wolf CoveGrand OpeningsQuaker

In the third installment of our mini-series on Charlie Munger, we delve deeper into the wisdom of one of the greatest investors and thinkers of our time. This episode continues up our series with a focus on Munger's most impactful strategies and philosophies that have influenced generations of investors and entrepreneurs. If you enjoy listening to the podcast, please do us a favor and leave us a review on Spotify or Apple! Also, we just released new products to take your home building company to the next level at the BUILDING OPTIMAL SHOP. Thank you to our amazing brand partnersSubzero Wolf CoveGrand OpeningsQuaker

Part 2 of our mini-series on Charlie Munger, one of the greatest investors of all time. He’s also one of the most profound thinkers of our era. This continues a multi-part series of short episodes dissecting some of Jared’s favorite lessons from the investing giant.If you enjoy listening to the podcast, please do us a favor and leave us a review on Spotify or Apple!Also, we just released new products to take your home building company to the next level at the BUILDING OPTIMAL SHOP.And don't forget to sign up for our NEWSLETTER where we have all kinds of good tips and info you don't get with the podcast.Thank you to our amazing brand partnersSubzero Wolf CoveGrand OpeningsQuaker

Charlie Munger is one of the greatest investors of all time. He’s also one of the most profound thinkers of our era. This begins a multi-part series of short episodes dissecting some of Jared’s favorite lessons from the investing giant.If you enjoy listening to the podcast, please do us a favor and leave us a review on Spotify or Apple!And don't forget to sign up for our NEWSLETTER where we have all kinds of good tips and info you don't get with the podcast.Tools to make more money and grow your bizNeed a little help growing your business or making more money at it? In addition to almost 100 free episodes of the podcast, check out The Building Optimal Shop, a place where we have business tools for builders and contractors…and the list is growing. Or, if you want full-scale consulting or business startup help, check out our brand new:Building Optimal Business AcceleratorThank you to our amazing brand partnersLowe’s and the new Lowe’s MVP Pro Rewards ProgramSubzero Wolf CoveHuber Engineered WoodsGrand OpeningsQuaker

This is a departure from our regular programming - Jared shares a very short story from World War II, and how you can apply it as a problem-solving model in your own business.If you enjoy listening to the podcast, please do us a favor and leave us a review on Spotify or Apple!And don't forget to sign up for our NEWSLETTER where we have all kinds of good tips and info you don't get with the podcast.Looking for tools to make more money and grow your biz?In addition to almost 100 free episodes of the podcast, check out The Building Optimal Shop, a place where we have business tools for builders and contractors…and the list is growing. Or, if you want full-scale consulting or business startup help, check out our:Building Optimal Business AcceleratorThank you to our amazing brand partners...Lowe’s and the new Lowe’s MVP Pro Rewards ProgramSubzero Wolf CoveRAM Windows

Trey Farmer is an architect with Forge Craft Architecturehere in Austin. We interviewed him previously on#63: Lessons From a Passive House Build. Today we revisit some of those passive home principles and also discuss some of his beliefs for building healthier, more grid-resilient homes.If you enjoy listening to the podcast, please do us a favor and leave us a review on Spotify or Apple!And don't forget to sign up for our NEWSLETTER where we have all kinds of good tips and info you don't get with the podcast.Tools to make more money and grow your bizNeed a little help growing your business or making more money at it? In addition to almost 100 free episodes of the podcast, check out The Building Optimal Shop, a place where we have business tools for builders and contractors…and the list is growing. Or, if you want full-scale consulting or business startup help, check out our brand new:Building Optimal Business AcceleratorThank you to our amazing brand partnersLowe’s and the new Lowe’s MVP Pro Rewards ProgramSubzero Wolf CoveHuber Engineered WoodsRAM Windows

It's hard to spend a few minutes chatting with Jacob Deva Racusin without leaving inspired. He is the Director of Building Science and Sustainability for New Frameworks, an innovative, socially inclusive design/build firm in Vermont. He also serves as an Embodied Carbon Analyst and BEAM Trainer with Builders for Climate Action.In this conversation we discuss Jacob's ideas on how to minimize the embodied carbon in our buildings or even turn them into carbon sinks. Jacob also shares his benefits of straw bale building techniques and the socially inclusive culture they have created through a worker's co-op structure at New Frameworks.Enjoy!Links from the episode:Builders for Climate ActionBEAM EstimatorNew Frameworks WebsiteNew Frameworks on InstagramCroft Straw PanelsThe U.S. Federation of Worker CooperativesCompanies We Keep, by John AbramsTools to make more money and grow your bizNeed a little help growing your business or making more money at it? In addition to almost 100 free episodes of the podcast, check out The Building Optimal Shop, a place where we have business tools for builders and contractors…and the list is growing. Or, if you want full-scale consulting or business startup help, check out our brand new:Building Optimal Business AcceleratorThank you to our amazing brand partnersLowe’s and the new Lowe’s MVP Pro Rewards ProgramSubzero Wolf CoveHuber Engineered WoodsRAM Windows

In this conversation we sit down with Dan Kolbert, co-author of Pretty Good House, and owner of Kolbert Building in Portland, Maine, to discuss high performance homes, the next evolution in building, and Dan's advice in today's economy.Links mentioned:Pretty Good House BookWater in Buildings, by Bill RoseChristine Williamson's InstagramHuber Engineered WoodClimate Zone MapTimber HPBEAM EstimatorBS and BeerTools to make more money and grow your bizNeed a little help growing your business or making more money at it? In addition to almost 100 free episodes of the podcast, check out The Building Optimal Shop, a place where we have business tools for builders and contractors…and the list is growing. Or, if you want full-scale consulting or business startup help, check out our brand new:Building Optimal Business AcceleratorThank you to our amazing brand partnersLowe’s and the new Lowe’s MVP Pro Rewards ProgramSubzero Wolf CoveHuber Engineered WoodsRAM Windows

We have a new, slightly different (and hopefully upgraded) direction for Building Optimal, and are excited to share it with you in this episode.We also visit with Mark Sprague, State Director of Information Capital for Independence Title. Mark is one of the most respected real estate market analysts and forecasters in Texas, and shares some of his insights with us in this short, 25-minute episode. In full disclosure, 75% of the information Mark Shares is specific to Austin or Texas, but 25% covers a national focus.Enjoy!Tools to make more money and grow your bizNeed a little help growing your business or making more money at it? In addition to almost 100 free episodes of the podcast, check out The Building Optimal Shop, a place where we have business tools for builders and contractors…and the list is growing. Or, if you want full-scale consulting or business startup help, check out our brand new:Building Optimal Business AcceleratorThank you to our amazing brand partnersLowe’s and the new Lowe’s MVP Pro Rewards ProgramSubzero Wolf CoveHuber Engineered WoodsRAM Windows

David Gerstel has written some of the top books available for construction professionals who want to build a better business. His latest book, Building Freedom: A Construction Pro's Path to Financial Independence, is the topic of today's conversation.We cover some novel concepts from David such as Employee-Centered Companies, thinking errors that hold us back, his research on selling construction companies, and more.In the episode we discuss a few books:Small Giants: Companies That Choose to be Great Instead of BigCognitive Behavioral Therapy Made SimplePlease enjoy this enlightening episode!Tools to make more money and grow your bizNeed a little help growing your business or making more money at it? In addition to almost 100 free episodes of the podcast, check out The Building Optimal Shop, a place where we have business tools for builders and contractors…and the list is growing. Or, if you want full-scale consulting or business startup help, check out our brand new:Building Optimal Business AcceleratorMuchas gracias to our amazing brand partnersLowe’s and the new Lowe’s MVP Pro Rewards ProgramSubzero Wolf CoveHuber Engineered WoodsRAM Windows

We are visiting with Amy Kerr of Sub-Zero Wolf Cove to discuss supply chain updates and new innovations in their appliance lines. This episode is a short one, but full of great updates. Enjoy!Tools to make more money and grow your bizNeed a little help growing your business or making more money at it? In addition to almost 100 free episodes of the podcast, check out The Building Optimal Shop, a place where we have business tools for builders and contractors…and the list is growing. Or, if you want full-scale consulting or business startup help, check out our brand new:Building Optimal Business AcceleratorMuchas gracias to our amazing brand partnersLowe’s and the new Lowe’s MVP Pro Rewards ProgramSubzero Wolf CoveHuber Engineered WoodsRAM Windows

Wally Staples is back. This time, we talk specifics of his employee compensation practices as well as some of his principles for being an "anti-fragile" builder. And don't miss my first interview with Wally, #68: Ensuring Profitability and Employees First with Wally Staples.Enjoy the episode!Tools to make more money and grow your bizNeed a little help growing your business or making more money at it? In addition to almost 100 free episodes of the podcast, check out the Building Optimal Shop, a place where we have business tools for builders and contractors…and the list is growing. Or, if you want full-scale consulting or business startup help, check out our brand new:Building Optimal Business AcceleratorMuchas gracias to our amazing brand partnersLowe’s and the new Lowe’s MVP Pro Rewards ProgramSubzero Wolf CoveHuber Engineered WoodsRAM Windows

Vik Szemerei is the Vice President of Sales for luxury plumbing company, House of Rohl. They own brands such as Riobel, Victoria and Albert, and Rohl.We discuss cool new plumbing trends like aromatherapy shower heads, hand-crafted fireclay sinks, touchless faucets, and more.And, to my delight, Vik explains the rise in popularity of biophilic design as we find ways to make our homes healthier and more comfortable.Enjoy the episode!Tools to make more money and grow your bizNeed a little help growing your business or making more money at it? In addition to almost 100 free episodes of the podcast, check out the Building Optimal Shop, a place where we have business tools for builders and contractors…and the list is growing. Or, if you want full-scale consulting or business startup help, check out our brand new:Building Optimal Business AcceleratorMuchas gracias to our amazing brand partnersLowe’s and the new Lowe’s MVP Pro Rewards ProgramWolf/SubzeroHuber Engineered WoodsRAM Windows

Jared shares some of the lessons from his home building journey, and announces the latest offering from Building Optimal...our Builder Accelerator, to help others find success and build a great company.To learn more about the Builder Accelerator, go to:https://www.buildingoptimal.com/the-builder-acceleratorUse code LAUNCH between now and 5/19/22 For 20% off all our products at the Building Optimal Shop.As always, a special thanks to our show sponsors:Lowe’s and the new Lowe’s MVP Pro Rewards ProgramWolf/SubzeroHuber Engineered WoodsRAM Windows

There are a lot of misconceptions about Zip System.®  Mike Dye, Senior Engineer at Huber Engineered Woods, joins us to dispel those and also provide some useful ideas to improve the efficiency and sustainability of your builds. Enjoy the episode!New products launching in the Building Optimal Shop!Need a little help growing your business or making more money at it?In addition to almost 100 free episodes of the podcast, check out the Building Optimal Shop, a place where we have business tools for builders and contractors…and the list is growing.Or, if you want full-scale consulting or business startup help, check out our brand new:Building Optimal Business AcceleratorMuchas gracias to our amazing brand partners:Lowe’s and the new Lowe’s MVP Pro Rewards ProgramWolf/SubzeroHuber Engineered WoodsRAM Windows

RAM Windows has emerged as one of the leading window manufacturers in the State of Texas and beyond. We use their modern-design, aluminum windows on most of our projects (you can see them on our recent Kennelwood project here). As a brand partner of ours, I’ve gotten to personally know Eric Spence, President and CEO. It’s easy to see why RAM has experienced the growth trajectory it has with him at the helm. He is a superb leader and a master with all things windows and building science.In this interview, we cover a wide range of topics from Eric’s leadership advice to his views on the future of window technology. Enjoy a discussion with one of the industry’s truly great leaders.Video referenced in the episode - Cement: The Scale of the ProblemNeed a little help growing your business or making more money at it?In addition to almost 100 free episodes of the podcast, check out the Building Optimal Shop, a place where we have business tools for builders and contractors…and the list is growing.Or, if you want full-scale consulting or business startup help, contact me at [email protected]. We are a full-time building company - not a coach or mentor - but we have doubled over revenue to more than $50 million while actually cutting our overhead. And I’m happy to share what I know with those who could benefit from it.Fair warning, if it were a restaurant it would be $$$, my friends. But it also would have made me a few million more dollars if I had access to my current systems and thinking early in my career. Send me an email if you want to visit further.Muchas gracias to our amazing brand partners:Lowe’s and the new Lowe’s MVP Pro Rewards ProgramWolf/SubzeroHuber Engineered WoodsRAM Windows

Brian Potter is the author of Construction Physics, the best blog on construction news and innovation that I've found. "Why It's Hard to Innovate in Construction" is one of my favorite and a central theme in today's discussion.Brian is a structural engineer by training. He is currently a Senior Fellow at the Institute for Progress and previously led an engineering team at Katerra. Enjoy the episode!Have any topics you want me to discuss, guests to interview, or feedback about the show? DM me on Instagram @buildingoptimal or send me an email at [email protected] thank you to Lowe’s for sponsoring today’s episode! Learn more about Lowe’s for Pros HEREWant more good stuff? Sign up for the Building Optimal email HERE.

This is one of my favorite conversations to date with Luke Mezger, a top builder from Austin, Texas. Luke is Owner of Mezger Homes, a superb leader, and a brilliant student of the game. He lays out probably a dozen actionable tips most of us can implement today to build a better company. Enjoy the episode!Have any topics you want me to discuss, guests to interview, or feedback about the show? DM me on Instagram @buildingoptimal or send me an email at [email protected] thank you to Lowe’s for sponsoring today’s episode! Learn more about Lowe’s for Pros HEREWant more good stuff? Sign up for the Building Optimal email HERE.

Austin Miller is an Australian carpenter and builder who moved to Canada six years ago to build in the remote Arctic. In this episode we are exploring how building works in one of the world's most inhospitable places. If nothing else, this episode will make you extremely grateful next time you are looking for a bolt on your own jobsite (gotta listen to understand)!Have any topics you want me to discuss, guests to interview, or feedback about the show? DM me on Instagram @buildingoptimal or send me an email at [email protected] thank you to Lowe’s for sponsoring today’s episode! Learn more about Lowe’s for Pros HEREWant more good stuff? Sign up for the Building Optimal email HERE.Visit our online store to see our products to build a better business. HERE

Gabe Jewell is CEO of MT Copeland, a new online education platform to learn the building and construction trades. We need more affordable, accessible education within our industry. It’s why I started Building Optimal, and it’s why I’m a fan of what Gabe and his team are doing. Check out the episode to learn about what these innovators are doing to help builders, and you just may find a class you want to take. I have no financial incentive, btw. Just like what these guys are about!Keep up to date with MT Copeland on Instagram, @mt.copeland.Have any topics you want me to discuss, guests to interview, or feedback about the show? DM me on Instagram @buildingoptimal or send me an email at [email protected] thank you to Lowe’s for sponsoring today’s episode! Learn more about Lowe’s for Pros HERE...Want more good stuff? Sign up for the Building Optimal email HERE.

Pre-selling your homes under construction isn’t all rainbows and kittens, as many veterans know. Check out this short episode to learn the pros, cons, and nuances of pre-selling. Plus, I share some of my own strategies for crafting a more favorable pre-sell for your company.Have any topics you want me to discuss, guests to interview, or feedback about the show? DM me on Instagram @buildingoptimal or send me an email at [email protected] thank you to Lowe’s for sponsoring today’s episode! Learn more about Lowe’s for Pros HEREWant more good stuff? Sign up for the Building Optimal email HERE (sign-up top of home page).

A messy or worse, non-existent, change order system can sink a home builder. What should be a source of profits is often a place of loss and chaos. We can fix that in a hurry, though. Here is my company’s strategy to change order the right way.Have any topics you want me to discuss, guests to interview, or feedback about the show? DM me on Instagram @buildingoptimal or send me an email at [email protected]. Learn more about Lowe’s for Pros HERE Sign up for the best newsletter on the planet HERE (sign-up top of home page) BTW, refer our newsletter to 3 other builders and get a copy of my client pre-construction guide. Refer 10 and get a 20-minute Q&A with me. Details of how in the newsletters, my friends.

The success of every project is built upon meeting, or better, exceeding expectations. So it stands to reason that one of your many jobs as a builder is to proactively address with clients topics that could later become issues. In this episode I share 12 topics I always cover with new clients as soon as we enter into our pre-construction agreement.Have any topics you want me to discuss, guests to interview, or feedback about the show? DM me on Instagram @buildingoptimal or send me an email at [email protected] you to our brand partner, Lowe's! Learn more about Lowe's for Pros HERE.Sign up for the best newsletter on the planet HERE (sign-up top of home page) BTW, refer our newsletter to 3 other builders and get a copy of my client pre-construction guide.

Most builders I know are overworked and underpaid. Today's short episode covers a framework I like to use called The Eisenhower Matrix. It is a simple tool that can help you prioritize the things that will really propel you forward and leave behind the things that are sucking your time.Have any topics you want me to discuss, guests to interview, or feedback about the show? DM me on Instagram @buildingoptimal or send me an email at [email protected] more about Lowe's for Pros HERECheck out Spyder Blades HERESign up for the best newsletter on the planet HERE (sign-up top of home page) BTW, refer our newsletter to 3 other builders and get a copy of my client pre-construction guide. Refer 10 and get a 20-minute Q&A with me. Details of how in the newsletters, my friends.

Working with a difficult or exhausting client can make life miserable and put your company in danger. After working with hundreds of clients I've identified four red flags.If I start working with a client who demonstrates any of these behaviors in our early interactions, I will graciously walk away before signing a construction contract. Just as important (if not more) than securing good clients who can help elevate your business is steering clear of those who will damage it.Have any red flags you've learned along the way? DM me on Instagram @buildingoptimal or send me an email at [email protected] more about Lowe's for Pros HERECheck out Spyder Blades HERESign up for our YUGE newsletter HERE (sign-up top of home page) BTW, refer our newsletter to 3 other builders and get a copy of my client pre-construction guide. Refer 10 and get a 20-minute Q&A with me. Details of how in the newsletters, my friends.Have any builders who are making waves in the industry and would be good guests? Email me at [email protected].

Kyle Diamond is partner of New Dimension Construction, in Millbrook, New York. The family-owned business has operated for more than 30 years with a stellar reputation. Check out some of the tips that Kyle graciously shares with us. Y'all enjoy the episode.

Treacy, of NWC Alliance, returns to answer some FAQ from our community about insurance and third party warranties. Sit back, enjoy a nice cocktail, and sharpen up your insurance skills my friends.

You've probably seen Jason Pietruszka on Instagram or YouTube. He shares some great content on social media, but his day job is owner of JJP Construction, a luxury builder in L.A.Jason has had a rocket ship growth trajectory from an unlikely background, and now he's not only building but sharing his lessons with others. Y'all enjoy the episode!

If you're getting *hammered* on lumber prices, well so is the rest of America. What's happening and when will it get better? Lumber economist, Dustin Jalbert, has a few answers. Dustin leads the lumber analysis on Fastmarkets RISI's Wood Products team. He is responsible for the monthly Lumber Commentary, the North American Lumber 5- and 15-Year Forecasts, and both consulting engagements related to the North American lumber markets.Find Dustin on Twitter (@2x4caster) and on LinkedIn.Build on, and enjoy the episode!

This is a reading of an article we just published on the Building Optimal blog. If you prefer the written word, check it out here: https://buildingoptimal.com/8-tips-to-combat-soaring-costs/By the way, if you aren't already signed up for our Building Optimal newsletter, head over to buildingoptimal.com and sign up for free right now. Should take about 15 seconds and the extra value we will be delivering in that newsletter won't be found anywhere. So, check it out.

Michael Anschel is owner of Otogawa-Anschel, a design-build firm out of Minnesota. Michael frequently lectures on topics in the industry and also writes for several well-known publications. He has built a company that allowed him to actually take three years off! If that isn't enough incentive to listen to this episode, we also discuss ideas to implement from culture to transparency. Enjoy the episode!

This is one of my favorite episodes to date. Wally Staples, a builder from Maine, has always made a profit over his 28 years in business. He has never had to lay anyone off. And, he has a financial freedom plan for himself and his entire team.Tune in for the secrets and wisdom of Wally. As I say in the episode, it's an avalanche of good ideas. Enjoy, and happy building out there.Edit: In the episode we incorrectly stated the number of Wally's employees, Wally has 18 employees (whom by the way have been with him for an average of 9 1/2 years). Amazing retention rate!

Dan Edelman with Rockwool joins us to share his perfect wall assembly and discuss a few new innovations and changes in the building science space. Enjoy the episode!

If employee benefits make your head spin, you aren't alone. Luckily, we have Lauren Allen and Elisa Thornton on today's episode to help you out. They are with Brookstone Insurance, my own company's health and commercial liability provider. Enjoy the episode!

Ed Earl and Paul Sanneman, both previous guests, share the reasons why they like cost-plus contracts. As a fixed-price builder myself, I wanted to get the perspective from the other side of the aisle.If you want to learn more about Paul and Ed's work, visit https://residentialcontractorservicesgroup.com.Enjoy the episode!   “The wise man knows exactly what value should be put upon everything.” — Seneca     Over my 15 years to date of structuring real estate development deals, I’ve screwed up many a deal. I’ve left money on the table. I’ve shouldered too much risk. But luckily, on close to 100 projects I’ve sponsored, I’ve only ever lost money one one. The rest have performed well, and a good many surprisingly well (listen to my story in Episode 57).What has been the single biggest improvement I’ve made in how I structure my deals? I’ve started thinking of the deal components as separate “Value Buckets.” As a result, I have a much easier job identifying an equitable deal for everyone and easily selling it to my investors.   Value Buckets in a NutshellTo use value buckets, think of deal structuring as an accountant would. Each deal is a new company in a sense, and that company will have assets, liabilities, and equity that each of the parties to the deal should value at some notion of fair market value. This sounds basic, like a foregone conclusion, but many people miss this point. And when they start thinking of projects through Value Buckets, what seemed like a reasonable deal may no longer be.   Most Common Value Buckets  DeveloperThe developer finds, organizes, and sponsors the deal. He arranges all capital and oversees professionals such as accountants, lawyers, etc. The time, effort, and expertise in this role needs to be considered and compensated, usually as a percentage of back-end profits in the home building business. My company receives 50% of the back-end profits in exchange for this role.  General ContractorHome builders often plays the role of developer and general contractor in a speculative deal, which is why it’s important to distinguish these. A home builder needs to understand what his profit would be on this project if, hypothetically, it was a simple fee-based project for a client. Why? Because the additional roles the builder is playing in a speculative project, plus the risk, should result in a higher projected income to the builder versus a project for a client.I establish up front a fee between 7-8% of a deal’s projected sale price, depending on the size and complexity of the project. This fee is paid out to my company with the construction draws from the bank. This fee covers my company’s overhead in the deal but not my general contractor profit, which I defer to the end so that my investors and I are better aligned.The back-end profits I’m expecting to receive should be enough to account for both my role as general contractor and separately as developer. If the projected profits aren’t sufficient in that sense, I either restructure the deal or pass on it.  InvestorThe investor may be putting up all the cost of a deal, or if financing is involved, the portion of equity that sits behind the debt in the capital stack. The investor obviously needs to get compensated for the risk they are taking with their investment. Our development projects are far less liquid and less diversified than one can achieve in the stock market, which means we should be paying a premium to investors over typical stock market returns for the added risk profile of our projects.Beyond that, there are a lot of other factors that determine what a fair return is for your investor. If you are a brand new builder, you represent more risk than someone with decades of experience. You need to be offering a little higher return. Or vice versa.I structure my deals with investors like this: first, I offer an 8% simple annual preferred return on their investment to account for the opportunity cost of capital. Then, I split profits with them, usually 50/50. This profit split bucket represents their return for the extra risks I mentioned above.If you notice both with my fee I charge the project and the preferred return I offer investors, I’m structuring the deals such that we try to value and cover our respective costs first, and then profits we split on top of those costs should be a more accurate representation of profitability.If I see newbies make one mistake, they fail to account for the true cost of their overhead in the deal and they end up having to pay for it with their supposed profit split at the end. I made this mistake for my first several years.  Credit EnhancersBanks usually get the credit enhancement they need via personal loan guarantees. While this value bucket often gets blurred into others, it’s necessary to break it out for a clean view of the landscape. Some deal sponsors offer additional profits for the people who assume this risk, while some offer flat fees based on the loan amount.I ask all our partners to guarantee the loans we obtain, including myself. This way we spread the risk. I compensate my investors for this additional risk they assume via higher targeted returns. In other words, most of the projects I sponsor target IRR’s in the low 20% or higher. If I wasn’t asking for loan guarantee support from my investors, I believe the high teens would be a fair return to target for them. And I would accomplish that by shifting the profit splits whatever amount necessary to keep the target returns in that range.  Other Imputed EquitySometimes we have a land seller who wants to sell us the land and roll in a portion of the price as investment in the deal. Or we have a broker, architect, or engineer that wants to do the same. This gets messy, so the best way to think about it is to always determine a fair market value for the land or service or whatever is being invested, assuming they would be getting their money up front per usual terms. Then, the amount from that value that they want to defer or invest into the project can be considered and adjusted to reflect for the value they are providing by imputing or “investing” that money into the project. And remember, if they are deferring that amount it should probably receive some return in exchange.   ConclusionThose are the typical value buckets as I see them. They are just a general framework and can always be amended as necessary. Seeing the individual components of a deal, the assets and liabilities as I mentioned in the beginning, helps create a much clearer baseline from which to structure and negotiate.What you decide is fair is between you and your investor, but having these value buckets and general reference points of fair market value for each one will take you 90% of the way.

Most builders would get an F on our digital marketing, but it's an area that can exponentially grow your business if you develop the right strategy. I'm visiting with Spencer Powell, a digital marketing expert who specializes in builders and contractors, to share a few ideas of how to get started or get better.Spencer is the Inbound Marketing Director at Builder Funnel. Since 2010, he’s been building out a proven model and system that has helped generate thousands of leads for his clients. He specializes in helping home builders and remodelers bring their websites up to speed – not only building traffic but focusing on lead conversion and ROI.Enjoy the episode!

What are some of the top systems you can install in your project to move it closer to a passive house? Trey Farmer has a few answers for us. In this episode we are exploring Trey’s personal home he just built as a case study of what worked great and what he would do differently next time.Trey is a licensed architect with the well-reputed firm, Forge Craft Architecture. He is also a partner in Studio Ferme, an interior design firm out of Austin. He sits on the board of the Austin Passive House Alliance and is an expert on sustainable design and construction.Enjoy the episode, and happy building!

I've been using a framework I call "Value Buckets" to structure my deals. It's nothing more than a mental system I created to help me optimize my returns and also create alignment and trust with my investors. It's a short episode - 12ish minutes. If you prefer to read, here is the link to the blog article.Enjoy the episode!