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Twenty of our loans were paid off and closed out this year, which means twenty times we found out whether we had been right about something nine months earlier. In lending, being extra right pays nothing. Only being wrong costs anything. I want to spend this quarter's letter on a claim I think is under-argued, and then show you my own numbers against it. I. The Asymmetry Nobody Built For Start with the shape of the instrument. If you own equity in a project and the property f

When you play in the NFL, everyone wants to show you a deal. I took those meetings for years. The growth side of a portfolio is crowded. The income side is empty. I invested in more than fifty syndications and private deals and built my own rental portfolio one house at a time. I was not a passive listener. I was writing checks and watching what happened after. Almost none of it paid me anything I could live on, on a schedule I could plan around. Every pitch was about what my

I bought my first rental property while I was still playing, and it was not because I was some visionary. It was because I could do math about how long an NFL career lasts. If you have a career, you already own a large growth position. Most people then go buy more growth and call it diversification. Let me say the balanced thing first, because I mean it. Growth plays are invaluable. Appreciation is real, it is where outsized outcomes live, and I own assets right now whose ent

I looked at two opportunities side by side, and the useful thing I learned was not which one to pick. A higher return and a better risk-adjusted return are two different numbers. Most portfolios only ever measure one. The first: a ground-up development. Projected 15% IRR, five-year hold, nothing paid out along the way. Everything arrives at the end. The second: a first-position loan at 70% loan-to-value, paying 10% cash-on-cash, distributed monthly. Let me start by giving the

THE ASSET YOU ARE CHARGING FOR BY MISTAKE People keep telling me to charge for this letter, and I am never going to. Let me show you the math on why, because the same math is sitting somewhere in your business. The most valuable asset I own is the one I refuse to sell. The advice is always some version of the same thing. Paywall it. Turn it into a course. Build a mastermind around it. And the pitch is not crazy. It is arithmetic. Take a list of a couple thousand readers, conv

Years ago I had the chance to invest in one of the hottest brands in Arizona, and it filed for bankruptcy. Popularity is not underwriting. Salad and Go is gone. Every location closed permanently. If you live here, you know exactly what that sentence means. Started in Gilbert in 2013, built around a genuinely great idea, fresh healthy food at drive-thru speed and fast-food prices, it served more than 60 million meals over thirteen years. People did not just like it. They loved

IS YOUR BUSINESS A CASH SUCK OR A CASH FLOW? One of the sharpest builders I know goes more than a year at a time without getting paid, and his business is working exactly as designed. Every business is either a cash suck or a cash flow. The danger is not knowing which one you are running. He builds custom homes. From the day he breaks ground, the money flows one direction: out. Payroll, subs, materials, insurance, interest on the construction loan, every single month, for twe

My home state just booked the biggest economic development year in its history, and I want to talk about why I am not spending a dollar of it yet. Announced capital is not poured concrete. Poured concrete is not payroll. The numbers first, because they are real and they are big. Arizona closed its fiscal year on June 30 with $109 billion in committed investment and 26,225 projected new jobs, both single-year records, spread across 23 communities at an average projected wage o

New data dropped on Arizona this week, and most people read it exactly backwards. Every market tells you where to sit in the capital stack. Arizona just spoke. The study, from NetCredit using Zillow data: renting in Scottsdale now costs 55% less per month than owning the same home. $2,113 in rent against roughly $4,700 in mortgage, taxes, and insurance. Chandler, Mesa, Gilbert, and Phoenix all show gaps between 32% and 38%. And in DC Ranch, the most extreme neighborhood in th

A few weeks ago, one of the loans in our portfolio nearly lost its most important asset. Not the property. The person. Every deal is a bet on a person. Underwrite the day the person leaves. Here is what happened, with details changed to protect privacy. Two partners were mid-rehab on a project we financed. One brought the capital. The other brought everything else. He was the contractor running the job and the agent who would sell it. Then, halfway through the project, they s

There are lenders right now approving million-dollar loans in minutes. Datasets, valuation algorithms, instant term sheets. No phone call. No site visit. No human being anywhere in the decision. The pitch is speed and scale. And for standardized lending, consumer loans, conforming mortgages, automation genuinely works. Construction and rehab lending is not standardized. I want to walk you through why the industry is splitting into two camps that are both wrong, and what we do

I'll be honest about something I don't usually admit. A few months ago I went deep studying an investor who had reportedly built nine figures in a fraction of the time it's taking me. Operating brands, a sprawling holding company, an education empire layered on top. Big numbers, loud platform, the whole thing engineered to make ambitious people feel like they're moving too slow. And for a few days, it worked on me. I caught myself asking the question it's designed to make you

We just closed the books on the first half of 2026, and the headline is one I'm proud of: $14.4 million funded across Q1 and Q2. That already exceeds everything we did in all of 2025 by $3.6M, in half the time. But I've been doing this long enough to know growth numbers are the easiest thing in the world to dress up. Anyone can deploy more capital. The questions that actually matter are how you grew, and whether quality held while volume climbed. Here is what is underneath th

The biggest lender in my corner of the market just got acquired for $717 million. Most people outside private lending did not notice. If you allocate capital anywhere near private credit, or you are trying to understand where it is headed, you should pay attention to this one. What Happened Figure Technology Solutions, the publicly traded blockchain-based capital markets platform, agreed to acquire Kiavi, the nation's largest residential transition loan lender. Kiavi originat

I was listening to Alex Hormozi break down business-building recently and he made a framework click for me that I want to pass along. Most people stumble into one of these by accident instead of choosing it on purpose. And the wrong fit will quietly cost you years. There are really only four ways to build wealth through business. Every one of them works. But they demand different things from you, carry different risks, and reward completely different temperaments. 1. Bootstra

I have funded 74 loans to real estate investors across Arizona. All closed or current and performing. Never lost a dollar. That is not luck. That is borrower selection. The investors who execute almost always share one of two backgrounds. They are either licensed real estate agents, or they are contractors with construction experience. Here is why those advantages matter so much. Agent-Investors Do Not Overpay Licensed agents bring a specific set of advantages to a deal. MLS

TRUST THE OPERATOR. VERIFY THE STRUCTURE. Hey [First Name], A well-known voice in real estate recently went public about a deal that went to zero. Investors lost their capital. All of it. Credit for the transparency. Most operators bury failures. Sharing the details publicly takes courage. But transparency after a loss does not bring back investors' money. Here is what happened. And here is what the structure should have prevented. What Actually Happened A multifamily propert

WHAT SPIRIT AIRLINES' COLLAPSE TEACHES ABOUT THE RACE TO THE BOTTOM IN PRIVATE LENDING Spirit Airlines just filed for bankruptcy. Their business model was simple. Be the absolute cheapest option. Strip out everything: legroom, overhead bins, free carry-ons, customer service. Compete purely on price. It worked for a while. Until it didn't. The same race to the bottom is happening in private lending right now. And it is going to end the same way. 1. What Killed Spirit Spirit's

WHAT 5 MONTHS OF GROWTH TEACHES ABOUT BUILDING CAPITAL VELOCITY Hey [First Name], In less than 5 months, we have funded $11.8M in loans at 42 Solutions. That is $1M more than we funded in all of 2025. 18 loans in 5 months versus 23 loans in the entire prior year. I want to be clear about something. We did not get lucky. We did not stumble into a hot market. We systematically identified three constraints that were choking growth and removed all three at the same time. When tha

In February 2026, I went through my first foreclosure. After 70 loans funded and over $28 million in loan volume, a borrower walked away from a property mid-project. We took over the property, relisted it, and sold it within 30 days. Final result: 100% of principal recovered. 100% of interest collected. Agent commission covered by sale proceeds. Capital left over. We actually collected more than we would have if the loan had performed on the original timeline. I want to walk