 Income producing forms. How does this work? This came across my desk and I thought it was very interesting. I said, you know what? I need to check this out. Bring this out to the audience because we hear about so many things, real estate, single family homes, multi-family homes, apartments, things like that, but income producing forms. But without further ado, as you guys and girls can already see in this description box in the topic, we have a very special guest coming from Rad diversify, Mr. Dutch Mendenhall. He's in his Tampa Bay, Florida office today right now. I'm in Denver, Colorado. So you guys and girls stay locked. Once again, ladies and gentlemen, boys and girls, my name is Prince Dax. This is Dutch Mendenhall. How are you doing today, sir? I'm doing good, Prince. Thanks for having me. Thank you. Thank you for being home for people who may not be there. Where have you, you know, tell us a little bit about your background? How did you get into this whole real estate thing? Oh, yeah, man. So I was a consultant for about a decade in real estate and information marketing and real estate companies that did coaching and mentoring and over the years, I kept writing these models and seeing these business models. And I said, hey, nobody's ever combining the maximum ability for people to learn, be trained, be developed in real estate and the investing at the same time. And so after a lot of our students when we opened our own brand said to me, said, hey, Dutch, invest with us, put your money where your mouth is. Stop teaching, stop training us. I said, all right, I said, let's do it. Me and my partners, we began doing it in 2015 with our investors. We've built a $200 million plus portfolio hand in hand with our students over the years and was started off with residential family homes and tax deeds and leans then grew into multi family. And then when the pandemic hit, we moved into income producing farms. And so I'd had a good friend for a long time. It kept pushing me to invest into farmland. And I always said no. And I kind of ignored it. And he, you know, was a multi-generational farmer. And then the pandemic hit and I said, hey, farms having a farm that produces crops and produces food and has cattle on it. Sounded pretty interesting to me. And then I started to run the math and I started to analyze the numbers. And I said, if I can treat each acre like an apartment unit, if I can treat each acre as its own income producing tract of land. I said, when I started looking at the cap rates and I started looking at the return side, I was just blown away. And then our ability to do scale. I mean, one of the things we actually recently did was we bought a cattle auction and so, you know, to go along with our cattle that we're having and stuff. And so scaling, doing our economies of scale, growing, growing the different income parts of our farms has been it's been the most profitable thing I've ever done in real estate, which is interesting because I've been in real estate, you know, in one way, shape, or form my whole adult life. And I never planned on getting into farms. And then and then as we got into farms and we realized the profitability and we started to build our teams and our and our agriculture teams around them, we started realizing we could redivide allies land. We could increase irrigation. You know, it used to take many, many people and we used to take a whole bunch of effort and use way too much water. We can now control our irrigation on our farms, on an app, use less manpower and use a whole lot less water in order to do the best irrigation proper properly and also take land that was not not farmed at all and reclaim it. Right. I think soil is one of our great American resources here in our country. And so for us, we decided, hey, we go all in on this and we opened up, you know, rat American. It's been the most popular investment vehicle and most popular returns we've ever had for our investors. Nice. Um, now this income producing from farms, how does this play a role in the modern agriculture? So let's get down to the nuts and bolts of it and say, hey, um, you said you manage about a real estate portfolio about 200 million. Correct. Right. So do you, let's say if a client comes in or a partner and they say, Hey, I want to get into, you know, um, you know, income producing from farms, do you go out and do you acquire the farm? How does that work? Do you partner with the farm and do you do it yourself? Yeah. And so it just depends on the individual farms. So there's a lot of different things that happen in farming. So one of them is people will lease farms. And so, um, for us, we don't like leasing out our farms. And the reason we don't like it is because the maximum income potential for them is not usually reached or utilized. And so we found managing operating them ourselves is the way best way to maximize income. Now, if an investor comes to me and he says, Hey, Dutch, I want to invest into the farms, how are we a tool or a continent? I think there's one of two ways. One, we have our two investment vehicles that people could invest into. One is rad diversified, which is our public re non trader re, which has been around since 2019 started at $10 a share. And the current share price is 2504. Um, and then we have rad America, which is exclusively our land and farm land, read, um, which somebody could invest into. And that's currently opened in this year, January of this year. And it's still $10 a share, but we've raised $6 million in capital. We've bought just under $20 million in total real estate, uh, since opening, since opening that fund. And so, you know, we're super excited about the future of it. And then the other way is, you know, sometimes we have institutions or we have family offices or high net worth investors who come in and say, Hey, Dutch, I don't want to invest in a fund. That's my, not my vehicle. I'd like to join venture with you guys. I'd like to be a 50% owner or a 20% owner in a, in a farm. And so we've been able to do some different, um, joint ventures with, with farms as well. And so that's worked out pretty real effectively for us too. Okay. So let me get this straight. So you guys have a publicly traded REIT, real estate investment trust. I got that correct. Public non traded. Oh, non traded. Okay. Um, now on the other side, you say that you go out, you purchase farmland and then you lease the farmland for income, or you just like produce off of the crops yourself with the income, the cash flow. So the easy way, the lazy way would be to just lease it, just have someone else manage it and operate it. And there are people that I call, there's like, there's operators, what I call a true operator and there's babysitters. Right. And so a babysitter is someone who has money, they're going to throw money into a piece of real estate and just use a property manager. And they're just going to utilize the income on it, which is great. I said, Rad, we're a true operator, right? We get our hands in the soil. We get our hands dirty and we run and operate it ourselves. Our, we used to ride a home farm the year before we purchased it, had a lease on it for $40,000 a year in income. 18 months later, we produced seven figures, a million dollars in total revenue on the property in, in the second full, full year of business. And so how we operate is very, so make sure I got there right. So the $40,000 you're saying, Hey, somebody would just leasing out their form just for, Hey, this is my farmland. Leased it out for $40,000. So you're saying Rad came in and said, Hey, I guess you started producing crops, is there livestock? What, what did you do there to generate that seven figures? Yeah. So we looked at the Ukraine-Russia crisis and Ukraine was the largest producer of wheat in the world. Right. And so I said, Hey, I said to our farm team, I said, can we produce wheat? We've produced corn. We've done soybeans. We've done other things. I said, is wheat something we can plant? And they said, yeah. And actually on all of our upper acres that used to be winter wheat and one of the things they had done is, so there's, there's government. I want to say the term is QRP. I could be wrong, but basically, if we let a part of our farm not be farmed, the government for agricultural, for conservation reasons will give us a monthly payment, a monthly allowance per acre. What that had done on that farm is it had expired. And so they were no longer receiving the monthly income, but they never began farming, right? A whole lot of the farm. Make sure I got you that. I'm trying to mean to cut you out there, but. That's okay. We have a little lag. I just want to make sure I'm tracking you all the way. So you said that the government incentivized you to produce that, to produce the, the agricultural, the produce that you was making from the land. I got that correct. That was, that, that is great. That's a pretty common thing in farming. Nice. Nice. Okay. They, you, I'm learning something new here. So you get, you, so you get it, is it a tax break or is it a monthly sniping? You know, how does the government incentivize you to. It's a specific dollar per acre. So they give you a certain amount of money per acre. And so it's not, it's not, it's not a tax break. It's a specific dollar amount per acre. And I, my team can look up the, the specific definite term and they'll tell me in just a minute. But, you know, it's interesting because it's common in farming where like farmers are notorious for saying, I'm broken. I'm poor, right? And, but you have a, you know, a multi-hundred thousand dollar John Deere tractor and their truck paid off in their land and their farm is paid off, right? But the kids have grown up generationally thinking, hey, my family's not poor, right? My family's been tight. And so lots of times family are thinking about how they want to pass the farm down generationally. But then their children aren't in a place where they want to, they want the farm, right? They haven't grown up in a place. And yeah, you do have generational farmers where that is awesome. But a lot of the farms we've bought are, are, are parents or families where they just wanted the farm to continue to, to exist and flourish. And they wanted to pass it down generationally, but whatever their family situation is, it didn't happen. And so, you know, we're able to go into these farms and really make them what they were always supposed to be. And lots of times what's different about us, I guess, I, than a traditional farmers, a traditional farmer is leaving season to season crop by crop. But at Rad, we can sit here and say, hey, what's the long term best practice for this farm? You know, for me to put, put money into the equipment, for put money into the irrigation, put money into the soil, it's just good, long term business investing. And everything for us is never about the dip or about the bad season. Everything for us is about what is the proper income? What is the proper play for this property? Long term and what's going to be the best thing for our land and soil. And so I found over the years that this is how we've been maximizing returns and getting just a higher yield, but inflation has helped to in this sense, right? Hyperinflation, commodities, the price going up, right at one point in time. And I, and I couldn't tell you the price, price of hay in this moment. I'd have to look it up, but at one point time, hay went from 160, you know, dollars a ton to 300 and over doubled, right? Two X and the price per ton. And so that makes a huge difference when you're when you're farming and, and, and like you can literally double what you were selling a crop for, you know, just 12 months before. And so for us, I took a look at those, those commodities and so which commodities do I know we're going to grow in value, but then also makes sense for us to plant and farm on, on our crops. OK, so now you go where you find and I've known people like that personally, where their grandfather was a farmer, grandfather, you know, farm the land and when it gets down to the grandchildren, the grandchildren go off to college or the kids go off to college and they nobody's interested in the land. So the land is kind of sitting there. So you say you're saying that you go in, you purchase the land, do you bring in your own farmers or do you train the people to be farmers? How does that work? Yeah, it's a great question. So on some farms, there's existing team in place. There are people who are currently farming. And essentially what we do is we come in and we make their lives easier, right? We give them a little bit better technology. We give them a little bit more resources and lots of times they have all the ideas already in their head on how to improve and make the farm more profitable. But the most common thing is, is we take a team into our Weezer Idaho farm and we do training. And so they'll come and live on premises and they'll develop and they'll train and they'll do best practices. And so that makes a big difference. So our farm team will go in initially and then they're going to do whatever construction needs to be done, whatever equipment needs to be done in place. And so there's an intense first season, right? And I go seasons as like winter, spring, summer, fall, right? So whatever the season we buy the property in, there's usually a pretty intense first season where we're doing some really hard work. And then it's always the second summer where you're maximizing profitability. Kind of that first season of farming that you go through, whatever the farm was before is pretty much what it's going to have to be during the first season. But then that second season is when we've seen the returns really yield profits and make a big difference in the ROI. Okay, so you go in, you grab some farmers and you say, hey, if you don't have a team involved, we're going to make your life easier. You send them off to Idaho, get them trained up. Now what about that back end of the farm of like once the produce is produced, how do you find out who to sell it to? Or who's your target audience is that already built in? What do you do on that end? Yeah, there's markets, right? Just like you would have a marketplace like a normal person if they wanted to go buy lettuce, right? They can go buy lettuce at a Whole Foods or a Sprouts or whatever other brand is out there. For us, there's markets and there's buyers. And so there's professional buyers that we have relationships with. And if you do enough research and enough homework, what you do is you get the professional buyers that are used to buying specific commodities in your area and you build a relationship with them. And as you build a relationship with them, you can kind of start to begin to be in a place where you understand what is your price per ton that you're going to get or price per yield that you're going to get for the commodity that you're selling. But at the same time, right? Rad Roy is about economy of scale. It's what I've always believed is a huge part of our business. And so for us, even being integrated with the cattle auction butcher shop with our cattle makes a big difference. And so for us, like cattle, typically you could go buy a cattle for $1,200, right? For a fully grown male cattle, pretty normal, right? That we would sell. I'm not using, by the way, I'm using layman's terms, right? For the farmers who are gonna judge me for not saying heifer or steer one of the other things that are out there, right? So, but then we take it to the butcher shop and if we butcher the cow ourselves, we can get as much as $1,800, right? Per cow. And so you take the 1,200 plus the 1,800, you're actually at 3,000. And so we decided to go ahead and start building our own butcher shop. And then we realized there was a cattle auction for sales. So we went ahead and purchased cattle auction. So scaling's a big important part of it and you can integrate. And we're very small, right? We're not Kroger who's a multi, the billion dollar companies that are out there, right? And different things. We're just, you know, we're an investment company that believes in our country, believes in our soil and believes in Americans investing in Americans. And if we can provide a great product for people, what's better? So now, so I'm a truck driver, a school teacher. I'm driving down the road. I'm listening to this podcast. I'm watching you live. I'm like, wow, incomproducing for farms. I never heard of it. I never thought about that. I knew what a farm was. That makes perfect sense. How do I get started? What do you say to that person? Well, I say my book Money Shackles, right? And I know I'm not trying to overdo promotions here. If anybody wants to go get a copy of our book, go get it. The reggae industry began in 2012. It's Money Shackles, right? Money Shackles is your book? Yeah, Money Shackles. Money Shackles. If we could put that up in Hawaii, the cover of his book, Money Shackles, that'd be great for the fans and the audience to see and the listeners to, you know, be able to catch why you're speaking to. So go ahead, that should mean to touch you out there. Oh, you're great, man. I just got so passionate about the financial system in America is there's a part of it that's broken, right? And it's people's understanding of how money works. And so the Shackles is all about people breaking free from financial bondage, right? I believe the difference, you know, between the understanding of what money is and not understanding of what money is, is huge. And, you know, people, Americans are taught, go to school, get in debt, go to college, get in debt, buy a house, get in debt, use your credit cards, get in debt. And reality is that debt can work as a useful tool for you, right? Investing can work as a useful tool. So in the book, we talk about the reggae industry in 2012 and Americans have the ability to be a fractionalized owner, right? In different investment vehicles, they can be a fractionalized owner in a farm or a luxury property on the beach. They can be a fractionalized owner in a business, right? It's the first time that a non-accredited investor, right? And I hate the difference between non-accredited and credit. I think it's economic discrimination, personally. So, but the first time I know about it, 110%, once I learned what an accredited investor was, I was like, well, this is creative because if you don't make this type of money, you may not understand what the economics are. I'm like, no, let, you know, lays a fair, keep your hands off of it. People will figure out, if you make a sophisticated investment and you didn't understand what you were doing, what's the difference between me going to a casino? I don't know what a straight line bet is and I bet my money and I lose it. Nobody's going to come back and give my money back. So why not let me make an opportunity that could change my life? So I'm right there with you on that 110%. Never understood it and never got it, but, you know, go ahead, I'm sorry about that. No, you're right, man, because it's clear there's a difference in opportunity, right? The wealthy have had the access to finances that the non-wealthy have not had access to, right? And for someone else to determine, you know, what an America can do is unconstitutional, right? We all have the equal right to pursue happiness, right? That is one of the core values in our country. It's one of the core beliefs. And to take an accredited versus non-accredited is an, like to me, you can be as hard as you want on the companies that are allowed to take investment capital. And they should have to all play on the same footing. But to take an average American and say, you don't have the same equal play in footing as others is frustrating. So for me, Money Shackles was all about showing Americans that from 2012 and on, there's a new path, a new way that passed. There's an industry that did not exist as now is in the billions, right? And I think it'll be the greatest. For me, I think it'll be the greatest alternative to Wall Street that's ever existed. I think for an average American, there's never been a true alternative to Wall Street. And I think the reggae industry creates that from crowdfunding. It creates it from the ability to invest in real estate in a way that they never had before with fractionalized ownership. So I think it's incredibly powerful. Oh, you said reggae, reggae, gotcha. Reggae, yeah. Yeah, I was thinking, I'm saying reggae. I'm like, reggae is blowing up. I gotta listen to this. Okay, so got it. So you're saying the reggae is allowing everyday people to get into these crowdfunding access. So a person is saying, hey, I'm listening to you, Dutch. I like what you're saying. I like rad. The website was put up there. We went through the site, we like what you're doing. How do I get started with this? How do I get into this? I want to diversify. I already have a bunch of stocks. I own my own home. I have some equity in my home. I would love to get into a forum. What would be your entry point? I mean, if it's directly with rad itself, right? You absolutely can go to one of our websites. You fill out a form. One of our team will talk to you, have a conversation. Because of how the industry works, they're not allowed to sell. They can just provide information as all they can do. Do your due diligence, take your time, know who we are, right? You know, we have third-party audits, third-party evaluators of every asset we have. We're completely transparent with every asset. You literally will see addresses. You can drive by the street and you would know that rad owns it. You can pull title, know that rad owns it. I think one of the reasons I went through the regulation A, regulation in the beginning principles, because I wanted investors to feel comfortable and feel that like, hey, we're doing everything we can do to be compliant. We're doing everything we can do to make sure that they know what's going on. Like you look at the old, like you look at Madoff and you look at some of the other stuff, right? He wasn't a public company. He was private. He didn't have the reporting. There was not a set of assets that he owned that you can verify and you can check, right? And reality is, we shouldn't allow those things to exist. I believe, right? I don't think our government should allow those things to exist. I think if you're taking in people's capital and money, you absolutely should have to be transparent, open, and real about everything that you're doing. For me, even traders, they should have to have open screens and open books. But that's my own agenda of what I believe in Americans should all have access. Growing up poor, I knew I didn't have the same opportunities with others. And there are certain things I couldn't even understand growing up. I didn't understand why one person could get a scholarship and another person couldn't. I didn't understand why, if you looked at the wealthier schools, well, they had a hundred scholarships that went to their seniors and in my school there was like two, right? That went to seniors and so some of those things, I think it's just in my DNA to create more of that equality. It's important to me as a person and I strive to do that through Rad. One of the things we did is we started a Rad Foundation Scholarship. So actually everybody who invests with us, their kids become eligible for our scholarship programs and it's something we just did for all of our employees and investors. We gave out 14 last year. This year I want to give out a whole bunch more than that. It's just a big part of my passion. Okay. So do you have a minimum investment? Do you have to have a minimum? If you have to be a quarter million, 5,500, what do you got to have to even think about getting into the space? Yeah. So through our Regulation A, we were a $1,000 minimum investment. Through our Regulation D, we're a $10,000 minimum investment. We are currently, if we've applied for a Regulation A with our Rad America, we had the Regulation A with Rad diversified and then there's what's called a Regulation D and so the minimum for that is our $10,000. And so just jump on the phone with our team. They'll help you figure out where you can invest with us, where you can not invest with us and those kind of things. There's a lot of regulations and compliance and so we'll provide you all those disclosures and things are on the website. You got to read the offering circulars. I'm always very careful on this line just because I don't, I'm not Elon Musk so I can't tell the SEC. I'm going to say whatever I want to say. All right. I want to respect and listen to them and that part of it. And so it's very, very important. And though we are a good-sized company and we've been around a long time, we're not the richest man in the world. So. Okay. And I got to answer this question where someone is looking at it. They're saying, hey, so what are those returns? What are those annualized returns on this incomproducing farm? You know, what's the average? I know you can't predict the future or say, hey, this is what you're going to make. You know, guarantees there. But you know, what has been some, you know, compared to the S&P 500. How has it done? Yeah. I mean, I've kicked the S&P 500s. I read your thing. I'll be careful. I kicked their butts, right? And the reason, you know, I, we started at $10 a share, 2019 in Rad Diverse 5. We're currently at 2504 a share. And so, you know, our share price has grown over those years. Our investors, you know, are every six months they can do what's called a cash redemption and they can redeem stock with us and we purchased that back ourselves versus trading on the open market. Because I didn't want what Elon or what Biden or Trump or what someone else says to change my stock price. I wanted our stock price to be based on net asset value, be based on investment income, be based on exactly what we're doing every single day. And so, Rad America has not had its first stock price change yet. It's at $10 a share currently and it'll have its stock prices, you know, changing accordingly based on our net asset value. What I, here's what I say, I can never predict the future and I actually think any real estate vehicle that says here's what your IRR is, here's what your return on investment is, here's what your future value is. I think they're full of crap. So if they're full of crap, it means that like they can't predict what the cost of materials, what would, what cement, what steel, what wiring, what all that's going to cost. They can't predict what the cost of labor is going to be in the future, especially not in a hyper inflationary world. They can't predict those things. So I think they're full of crap. Here's what I would say, the reason people say, well, how did RAD get such good returns? I said, I can't understand why other REITs aren't getting better returns. When you take a look at it and an asset and you say, here's what the leverage we use on, here's how much money we put in, here's how much income it produced, here's how much equity it produced. The math makes good sense to me. I think what you see them not do is you don't see them by under market, off market, non-market properties. I don't think you see them by value add increased, you know, value, value assets and properties. And I think they're now also not doing, you know, there's a science to real estate, right? Location, location, location is true. But what does that actually mean, right? You understand what the landmarks are and how the price variation comes off of a landmark based on the valley. I call it the valley in the desert. One side of every landmark is going to have higher values. The other side is going to have lower values, right? The other side of the railroad tracks is a very true statement and it's very true, right? Based on the school systems, based on the crime rates and based on how things are lined up, it's going to determine, right, the future values of properties and how much they appreciate. And in different economies and markets, certain locations, certain types of value assets are going to appreciate more than other economies. Like right now, assets that were luxury, actually 12 months ago, luxury assets were going to appreciate incredibly fast. During hyperinflation, they were going to grow in value incredibly fast. Right now, income-producing properties are going to grow faster in value. Why? Because rents are going up. Anytime interest rates go up, mortgage rates go up, which causes rents to go up. As long as the mortgage, the value of an average mortgage continues to go up, landlords will continue to inch the rents up right underneath that. If people don't think like, I believe in deep state, I believe that the markets move when they make it move, right? And if you don't know how to take advantage of that and you don't know how to read it and see it, then you're not paying attention. So, you know, they want- I'm talking to you again. Their properties can work more money. I want you to say this again, Dutch. That was a very good point you made there. You've been a real estate guy. How can you take advantage of rising rates? I mean, interest rates are going to go up. And so for me, as a landlord, you're going to raise your rents accordingly with that, right? And I'm not doing this from a greed standpoint. It's the fact that this is what the market determines. This is what the market control is, right? And so as rents go up, you produce more income. As you produce more income, your property becomes more valuable. And so income-producing properties are going to be more valuable during high interest rates than brand new homes. And so it's just difference in how the game is played. As the cost of a mortgage continues to go up, fewer and fewer home buyers and fewer or fewer people want to move, people are going to be more forced to move, like if they have to move because of jobs or they have to move because of relocation, then because they want to move. When it's lower in interest rates, people move because they want to. They move because they can get another property in a location that they desire. They move because they can get a lower interest rate maybe than they previously had. Right now, people are moving because they either haven't owned before and so now it's time for them to own. They've gotten to that financial place that time in life or people move because they have to, because of life circumstances. Okay, now I want to say this for everybody that's out that if your kitchen is live or a playback, the first two people that I see comment the words, Dutch, you want to get a free copy of his book, Money Shackles. So you copy Dutch, if your kitchen is live or when you catch the playback, hit the word, comment the word Dutch and I will reach out to you, get your information and I would get a copy of his book out to you guys. Courtesy of Myself Protestants. Now, before we get out of here, Dutch, what do you want to say? What do you got to say to everybody? How can people follow you? How can people get more of you? Things like that, what do you want to leave the audience with? I mean, we're on every platform, right? Twitter, LinkedIn, Facebook, TikTok, right? Instagram, all of those things. If you want to follow, be a part of our tribe, right? We're going to be there to serve you. We're going to be there to take care of you. We're a very pro-American company, we believe and our warriors, I say, if you don't like our warriors that have made us free in this country, then don't invest with us, don't buy our book. I think I've had a great freedom to build an empire and wealth and the more paths and more avenues that I can open that up to everyday people, to the professionals, to the people working their ass off here in this country to be successful, I'm going to continue to do that and that's my mission in life. So Prince, man, great gratitude. You're spreading the message and I appreciate that. Thank you. And also I just retired from the Navy 20 years. So yeah, I'm one of those warriors you was talking about there too. So definitely. Well, people got your information, follow more, ask them questions. This has been a wealth of knowledge of talking about income producing, what to do, everybody look at rising interest rates at the end of the world and oh my God, the world's coming to an end. It's like, hey, there are ways to take advantage of how I'm rising interest rates too. So with that being said, Dutch, anything else before we roll out? If the world's coming to an end, you definitely want to have your money in the right places, right? And that's the thing is like the people that are controlling the greater things that are beyond your reach and my reach, Prince, right? They don't want the world to end, right? But they do want control of it and I believe in every American's freedom to control their own money, to control their own financial future and destiny and I look forward to being a part of that journey with those of you who see this and appreciate you, Prince, very much. Appreciate your service, brother. I can't have more gratitude. I've been free my whole life and I'm pretty lucky to have that freedom. Definitely, thank you. Well, ladies and gentlemen, that's going to conclude today's show, today's episode that you have, you have Dutch Mendenhall from Rat Diversified talking about income producing farms and also real estate and himself. Don't forget to drop Dutch below in the comments to get your free copy of his book, Money Shackles. Hope you guys and girls got something out of it. Until the next video, podcast, cartoon or whatever it is, whatever it, whatever, whatever. Crazy, you see me doing around in this globe. Peace, be safe, I'm out and thank you.