Crack the Code: Effective Contractor Vetting for Real Estate Triumph

John Harcar (00:01.93)
All right. Hey guys, welcome back to our show. I’m your host John Harcar and I’m here today with Bruce Rainey and what we’re going to talk about besides his real estate journey and a journey in business. We’re going to talk about taking action, but doing it the right way. Remember guys, at Investor Fuel, we help real estate investors, service providers. I mean really all real estate entrepreneurs, two to five extra business. We provide the tools and resources to build the business you want to build.

which helps live the life you wanna live. So Bruce, welcome to our show.

Bruce Raney (00:36.284)
Glad to be here. Appreciate the opportunity.

John Harcar (00:39.254)
Awesome, and I’m excited to talk about our topic because it’s something I run into a lot. There’s a lot of folks that just don’t take that action, but even when they do it, it might lead them astray. But before we talk about all that, let’s go a little bit about your real estate journey, your background, and what got you here to today.

Bruce Raney (00:58.206)
Sure, sure. To keep it short and simple, I have been in real estate my entire professional career. I’ve always been a general contractor since even when I was a teenager, I was out building things for neighbors and…

John Harcar (01:12.333)
Nice.

Bruce Raney (01:12.964)
As I grew up, got into commercial construction and have been doing that for 30 years now. So on the construction side, I’ve always been in it as an investor and developer for about the last 10 years, buying property, flipping property and that kind of stuff, mainly on the commercial side of things, but have seen every side of the business. So I’m pretty fortunate to have had all of those experiences.

John Harcar (01:39.574)
Awesome, and if you’ve watched any of my podcasts, you know, I like to go back. You said you were a kid doing, you know, building stuff and doing all that stuff. Did you have any other influence or anybody in your family, a father, uncle, someone in real estate that flipped houses or anything like that?

Bruce Raney (01:56.186)
No, you know, I worked for a guy, you know, I grew up in a generation where if you wanted things, you had to go out and work for it and earn some money to get it. And I worked for a guy. He was a few years older than me. He mowed yards and we built fences, you name it, decks, those kinds of things. And he just, he hustled. And anytime he had a job, was, I was the first one to volunteer. was

John Harcar (02:02.466)
Yep.

John Harcar (02:13.336)
Mm-hmm.

Bruce Raney (02:20.346)
I looked forward to the work back in those days. It was something fun, you were learning something. And I’ll tell you, a lot of the things I learned about how things go together and the right way to do it, I still carry those forward today. I learned those pretty young and it still matters and it still goes together about the same way.

John Harcar (02:36.302)
Yeah, I was going to ask what were some of the important lessons that you learned by working with this gentleman that kind of set you off for that path to success?

Bruce Raney (02:44.978)
Well, sadly, a lot of the things we learned, we learned together. He was only a few years ahead of me, but we would take on any project. And we just had this attitude of we will figure it out. But I’m going to tell you, we had a lot of…

John Harcar (02:52.589)
Okay.

Bruce Raney (03:02.366)
measure three times, cut four more times kind of experiences, right? And so, or you would just get finished with something and you say, you know, this isn’t right. We’ve got to redo it or redo part of it. He had a lot of integrity around that side of things where if it didn’t meet our standard, it didn’t matter if the client was happy where he said, we have some things to fix. And I’ve carried that forward in my career, certainly.

John Harcar (03:06.03)
Sure.

John Harcar (03:26.253)
Okay.

Well, and that’s important, right? You want to stand behind what you do. So how long did you work with this guy? mean, how long did it take for you to open up your do your own thing? I mean, tell us about that.

Bruce Raney (03:39.674)
yeah, I mean I worked for him for a few years. We moved away and I went into doing it for myself in high school. All the way through college, I mean I worked for anybody where I could keep my hands working. Through college I worked for a mobile home dealer believe it or not.

John Harcar (03:57.344)
Okay.

Bruce Raney (03:57.798)
And I was the guy that would go out to the mobile home after they delivered it. And I’m the guy that put the skirting wrap around the houses and I’d fix whatever broke in transit kind of stuff. And it just gave me a good opportunity to work on a lot of different things and see the, I guess you’d say the kind of the quality difference between what somebody might expect in residential or a mobile home. Because learning the differences in what to expect in the different.

John Harcar (04:07.757)
Right?

John Harcar (04:19.438)
Mm-hmm.

Bruce Raney (04:24.892)
Product types absolutely matters. so you name it, I got to work on it. Got to work with my hands, got to work with the tools, learn the vocabulary, right? And so I can talk about things and it helps out a lot when you’re out on the job site.

John Harcar (04:37.773)
Right.

And you said you were doing this in college? What did you study in college?

Bruce Raney (04:42.78)
All the way through college. Yeah. I went to college to get a degree in construction science. so I was, yeah, yeah. was, I was focused on construction. I always knew that’s what I wanted to do. It wasn’t even a question for me. I love

John Harcar (04:47.798)
There we go. All right, I was just trying to get, okay, trying to see if it’s all correlated here.

John Harcar (04:55.736)
Got it, all right. So you graduate college and you do what? What does that next step look like?

Bruce Raney (05:02.266)
So I moved to Waco, Texas to work for a general contractor. We built a lot of things at Baylor University. So it’s a smaller town with some big project opportunities. Worked in Waco for several years, went to work for another contractor close to town and got into building Walmarts and federal projects and high schools and things like that. So super diverse in kind of the…

John Harcar (05:10.893)
Okay.

Bruce Raney (05:31.976)
products I got to get my hands on. From there I moved down to San Antonio to work for a big developer, Trammell Crow Company. If anybody’s in real estate development, they’ve heard of Trammell Crow. That’s a pretty well-known brand. It’s been purchased by CBRE, probably the biggest real estate company in the world now, I think. Worked for them for a little while. that was in San Antonio, San Antonio in 08.

John Harcar (05:40.263)
Mm-hmm.

Bruce Raney (05:59.55)
A lot of things happen for lot of people in the economy and found a new opportunity to come go work for the power company, believe it or not. So now I’m managing construction of power lines, transmission lines, substations, things like that. after a few years of that, it was time to move to Austin. I’ve started my own firm. I’ve actually started a firm and sold a firm.

John Harcar (06:01.912)
Yeah.

John Harcar (06:18.04)
Mm-hmm.

Bruce Raney (06:28.4)
and back working for another firm. I’ve been through it all. I’ve been the employee, I’ve been a subcontractor, I’ve worked for the public utility, I’ve been a developer. So I’ve really seen this from every angle.

John Harcar (06:30.561)
Okay.

John Harcar (06:43.596)
And it’s interesting because I’m picking up a theme of all the whole story is that it seems you always sought out a mentorial type of relationship with somebody, right? To learn.

Bruce Raney (06:56.87)
absolutely.

John Harcar (06:57.838)
Why was that important to do that versus, I mean, you could join a course. I mean, I don’t if they had courses back then. I think they did. there’s other ways you could have learned. Why was it important for you to work for someone and learn that way?

Bruce Raney (07:13.362)
Well, because I’ve also been on both sides of that. You know, I will tell you that as the younger me was pretty arrogant and thought he knew everything. And I can tell you, I’ve paid a lot more in my education for mistakes than I ever paid to go to college or for any mentor. And these are irreversible. know, once you’ve made that mistake, once you’ve cut the board, it’s cut, right? And, you know, if I could teach people, it would be…

get rid of the ego, open up your eyes and ears, learn from people who have already done it, and don’t make those mistakes. somebody just told me the other day, they said, well, Bruce, you’ve had this world of experience. But if you tell me everything, I won’t have this life experience. I’m like, yes, that’s what I’m trying to do. Let’s avoid all those mistakes and all the hundreds of thousands of dollars or millions or whatever it’s cost you.

John Harcar (08:10.028)
Right.

Bruce Raney (08:11.046)
Don’t do that. Save that money and invest it into the next thing.

John Harcar (08:14.914)
And it’s also to the power of proximity, right? It’s about being with someone who’s where you want to go. You know what I mean? So you start your own business, you sell the business, and now you’re working for…

Bruce Raney (08:20.85)
Absolutely.

Bruce Raney (08:28.93)
General I’m worth the general contractor again. Yeah. Yeah Yeah, I am relaxing more. I’m leaning more into the development side Just can’t get away from construction obviously have a lot of connections and contacts in the business and so I’ll always I’ll always build and anything I do for myself. I build it. Absolutely

John Harcar (08:29.93)
Another general contractor. Okay. All right.

John Harcar (08:49.878)
Right. What do you think have been some of the main keys to success through all these different changes and opportunities and all that stuff that’s led you to today?

Bruce Raney (08:59.102)
Oh gosh. Keys to the success I would say is fearless is probably a strong word, just being willing to take action, being willing to make a change, be willing to make a move. A lot of times people just don’t, they just don’t do it. They take advice, and this might be a little side tangent, but I’ve learned to not take advice from people that don’t have what I want.

You know and and and so When that opportunity presents itself where I am confident is it doesn’t matter what I do if I’m in construction or development or Or whatever has to do with real estate. I’m very confident that I’m going to be successful because I enjoy it It’s you know, I don’t have to fight my way through it. I like talking about it I like touching it and feeling it and figuring out the problems and how to make it work So I’m not really worried about that. It’s really about as as my kids are getting older and

John Harcar (09:29.066)
Exactly.

Bruce Raney (09:59.152)
and I’m getting a little older, it’s more about quality of life. know, younger, I was running and gunning and doing everything and now it’s like, I can be more targeted with what I’m doing and enjoy it and slow down the pace a little bit more. I like that as well.

John Harcar (10:14.7)
Yeah, and I think that that’s everybody, you know, that that’s always happens as you grow. You know, you have that first push to get as high as you can, right? The best that you can. And then you then you realize that that peak was not the peak you were really trying to shoot for. It’s that that balance, right? That that life and stuff. So do you have any any, you know, a portfolio? Do you have any properties that you own? Any multifamily business or anything like that?

Bruce Raney (10:42.81)
Absolutely. Yeah, I mean, it’s all commercial. It’s office, it’s retail, it’s properties like that. I have never leaned into the multifamily space. That’s one place I haven’t done a lot of work. We build condos and some smaller things like that, but larger multifamily, that’s probably the one product type that I’m least familiar with and just never got confidence in a deal. I’ve looked at a hundred deals.

John Harcar (10:55.319)
Okay.

Bruce Raney (11:13.242)
But when I’m measuring things by cap rate, and I look at the cap rate on a multifamily deal versus a commercial real estate, a retail deal, they never measure up. And so I’ve always leaned toward the retail side of things.

John Harcar (11:25.634)
Okay, got it. Yeah, just kind of want to get a feel for what you’re doing now. So let’s talk a little bit about, you know, what was our topic today of taking action, but doing it the right way. What are you seeing people doing? You know, what mistakes are they making when they’re taking action, but doing it incorrectly?

Bruce Raney (11:29.106)
Mm-hmm.

Bruce Raney (11:43.496)
Sure. The good news is somebody’s taking action. I tell everybody, go find a deal. Go do a deal. Buy a doghouse. Do something. Learn the process, right? buy something. And because there’s so much paralysis around, my gosh, what if I lose money? What if I do it wrong? OK, what if you do lose money? OK, it’s a learning experience. I can promise you a lot of people have lost a lot more doing a lot less.

John Harcar (11:52.29)
Buy a dog house.

Right.

John Harcar (12:10.614)
Mm-hmm.

Bruce Raney (12:11.048)
but you’re taking action and you’re that forward and you’re learning something. What I would say that fascinates me, because in the last three months, I’ve taken over two construction projects from people who called me and said, can you help me out? The contractor I hired, I gave him money and he disappeared. I don’t know how this still happens in America, but it does. where’d you find the guy? What were his credentials?

You know, I’ve been in Austin for about 14 years and I’m like, I’ve never heard of these people. I’ve never heard of the people that introduced you to them. You talked to one guy, you hired him and you did no due diligence. So what I would tell people is do some due diligence. Find out about the person, find about what they actually do. And it’s okay to talk to a couple of contractors.

John Harcar (12:52.352)
Yes.

Bruce Raney (13:05.54)
every person I talk to I absolutely want to negotiate the deal. Hey, let’s do a design build contract. I’ll design it. I’ll build it. I’ll do everything for you. But it’s okay if you want to talk to a couple other guys and see if you like them better because in the world of at least construction, that’s it’s it’s a pretty long relationship. You want to make sure you’re communicating properly. You want to make sure you get everything. All the

all the boxes checked when they call you and say we’ve got a problem I need your help you trust that there’s a real problem and they need your help they’re not just trying to squeeze more dollars out of you and and that can it can make a really big difference in the experience of of doing a development or a flip or whatever you’re doing when you have good communication with your contractor I can’t I can’t impress on people enough how how important it is to make sure your contractors a good fit

John Harcar (13:54.371)
Right.

Bruce Raney (13:54.448)
So many people focus on dollars. They just want the cheapest guy they can find.

John Harcar (13:59.224)
But he’s got such a cool Facebook page and he’s got a website and he’s got, I mean, I’ve got something in the mail from him once. He’s, everybody knows who he is.

Bruce Raney (14:02.558)
Thank

Bruce Raney (14:06.82)
Mm-hmm. Yeah, Have guys they they hang they hang something on my door knob pretty much every day of the week And I appreciate the hustle right there. There’s a certain level of hustle but it’s understanding your product and and that’s where a lot of people I think struggle is if I’m building you know a class a product versus a B or I’m just trying to get somebody into to a residential property and have it

you know, qualified for somebody to live in. There’s a lot of variance in what you’d expect to see on the finished product. And so being able to have that discussion of what should I expect to see? What is a reasonable thing to experience? When I put in a space, most of the spaces I work on, look, if the door is scratched, I’m gonna have to get you a new door. There’s other product types where if the door is scratched, you know what? We’re gonna paint over that scratch and that’s what you get.

John Harcar (15:02.562)
Okay, right.

Bruce Raney (15:04.668)
And so it’s just understanding you as the contractor, you as the tenant or the client, just understanding that and being able to have a dialogue about it and make sure that you’re both on the same page.

John Harcar (15:18.796)
besides being on that same page and having that open communication, I what other ways can we vet somebody to assure we’re making a good decision?

Bruce Raney (15:27.998)
Sure, well, it does matter to me kind of who refers people. I always want to know, tell me how you found out about me. mean, everybody’s got a website, everybody’s got a Facebook page. We all do that stuff now. The best way to find out is let me talk to some clients. Let me talk to the last couple people you work for. It shouldn’t be that hard to get people on the phone.

And ask real questions. think that’s the other thing is people ask superficial questions. Are they a good contractor? Did they do a good job? Well, that’s relative, right? I mean, you might think I’ve done a horrible job and I might think I’ve done a great job. So it’s better questions of tell me how they manage the project. What documentation did they give you? When they build you, how did they do it? I mean, I literally get billed from people, some of my subs, I get a text message, right?

John Harcar (15:58.275)
Right.

John Harcar (16:20.631)
Right?

Bruce Raney (16:21.158)
But I send a professional pay application into my client and we sit down and talk about it. Here’s what happened this month. Here’s what we’re building. You know, and find out how that communication works. Because a lot of guys just say, hey, here’s my bid. I’m not breaking anything down. I’m sending you numbers and you’re going to pay me or else. Well, that may not be the best way to do that particular project. And understanding that there’s more ways to do it is of benefit to the client. I will tell anybody.

John Harcar (16:39.064)
Right.

Bruce Raney (16:50.398)
It’s never a good idea to pay your subs up front. I don’t do that. I do this professionally. Nobody gets paid up front. If they want to buy material, I actually go to the supply house and I pay for the material myself to make sure it gets paid for. So that’s a little nugget that I would tell anybody. If you pay guys up front, you have a really good shot of them not showing up. Yeah.

John Harcar (17:11.166)
losing the money And I always thought and you can correct me if I’m wrong a good question to be to maybe vet somebody is to you know Or maybe get some information tell me at a time when you didn’t perform

Bruce Raney (17:22.68)
didn’t perform. Well, I think that’s when that’s part of my learning experience. That’s when that’s when the our expectations and clients expectations. We didn’t we were not aligned where that normally happens. And this is another great nugget for the folks is when we have really bad plans. So if we walk through a space and say, I’d like to do this, I’d like to do this. And we’re pointing and talking.

huge opportunity for me to misunderstand or them to misunderstand what’s actually going to end up happening and somebody walk back in the spaces, that’s not what I wanted. And that can happen even if you have plans. Just because you have plans doesn’t mean everything’s answered. There can still be very vague plans that can get you a permit, but it doesn’t get you the final finish that you’re looking for. So.

John Harcar (18:14.499)
Mm-hmm.

Bruce Raney (18:15.898)
making sure you’ve you’ve got plans to the quality of what you’re expecting it’s super important i can’t tell you how many times somebody says well Bruce we talked about this you mean you mean six months ago when before we started the project you made one comment and you like you you wanted that to go to the vault when i said please please make sure that gets onto the plan talk to the architect make sure he gets that to the plan because i give plans to my subs and say

John Harcar (18:22.072)
Got it.

John Harcar (18:29.646)
And a text. Right.

Bruce Raney (18:44.03)
hey, go build this, give me a bid for this. I don’t say, oh, and the 17 conversations that I had with the client, you know, four months ago, that didn’t get on the drawings. It’s whatever ended up being on the drawings is what we’re actually providing a bid for. So that’s, there’s a lot of mistakes around that. And I can tell you to this day, sometimes I still help a friend out and we walk through and we write it down and still happens to this day. So.

John Harcar (18:45.603)
Mm-hmm.

John Harcar (19:00.514)
Right, right. Great nuggets, man.

John Harcar (19:13.166)
still happens, it’s always gonna happen. So in your bio here, you also talk about being a real estate coach. Tell us a little bit about that.

Bruce Raney (19:13.758)
Yeah

Bruce Raney (19:21.694)
Sure, sure. I, couple of years ago, I was, I think I got invited just to talk construction to an influencer online. He helps coach people, Hamza, I don’t know if you’ve heard of him yet. Yeah, so he coaches in the world of flex space and I built a lot of flex space and invested a lot of flex space in and around the Austin area. They invited me in just for a one time.

John Harcar (19:37.518)
Oh yeah, I know how it is.

Bruce Raney (19:50.938)
showing and I think they liked it so much they said hey how about how about you jump on and do it every other week and so I’ve been coaching there and then on the side I coach people just one-on-one to help them through whatever it happens to be I do a lot of I’m big into mindset and and mentally preparing yourself to do these things because there’s a lot of risk in real estate there can be really big numbers involved in this stuff a lot of people are getting advice from their friends who have never done real estate and

John Harcar (20:03.084)
Okay.

John Harcar (20:15.47)
Mm-hmm. Mm-hmm.

Bruce Raney (20:20.954)
it holds them back and really they need somebody to hold their hand and say listen I’ve done it you’re gonna be okay you just keep moving forward I’ll help keep keep you within the rails here and you’re gonna be fine and I’m gonna tell you it’s there’s nothing more rewarding you know it’s fun to build a building that you know it was a grass field and now it’s a cool building but it’s even more fun when somebody has never done this they go out and they finally

John Harcar (20:42.328)
Mm-hmm.

Bruce Raney (20:48.338)
figure their thing out. make money, they’re happy, and they realize at the end of okay, I can do this too, right? It’s very fun to empower people.

John Harcar (20:58.124)
Yeah, no, I love that. I love that. man, I love everything you shared today. If folks want to get in touch with you, if they want to reach out about your coaching, they want to talk more about, you know, doing some investing with you or whatnot, how do they get in touch?

Bruce Raney (21:14.174)
Sure, that is a great question. probably should have thought of, you know, I’ve got about four different emails and yeah. Sure.

John Harcar (21:19.182)
Well, if you want to say and we can put him in the show notes, I think I have the the Bruce at salt and pepper development.com.

Bruce Raney (21:26.974)
Yeah, it’s Bruce R at saltandpepperedevelopment.com. That’s probably the best place to send it. The construction side is much simpler. It’s just Bruce at Clio Builders, that’s C-L-E-O dot com. But yeah, either one of those places, I’m happy to get in touch with folks. Anything on coaching or development or anything like that, the Salt and Pepper is probably the

John Harcar (21:45.58)
Okay.

John Harcar (21:52.01)
Awesome. All Well, Bruce, I appreciate you coming out and sharing all this guys. I hope you took some good notes because he dropped some good nuggets. I enjoyed the show. I hope you all did. Bruce, thank you again. Yeah. And we’ll see you guys in the next one. Cheers.

Bruce Raney (22:03.134)
Thank you, I appreciate it.