How Devon Kennard Uses AI and Lean Systems to Scale a Private Lending Business

Devon Kennard (00:00)
There’s a lot of business owners and people in real estate, make sure you’re reverse engineering your goals to the business you’re running and to what you’re what you’re trying to do. Because for instance, like in my space, you have to know the kind of business you want to run. Like for me, I’m I’ve strategically made decisions based off of the idea that I want autonomy and control of my business. I don’t want a hundred person team and and have to manage all that. I have young kids at home. I played a long time in the NFL. I was, you know, fruitful enough to make good money there. So I I’m not willing to sacrifice certain things to try to build some large company.

Quentin Edmonds (02:12)
Hello everyone, welcome to the Real Estate Pros Podcast. I am your host, Q Edmonds, and I am indeed excited to be here today. I have another fantastic guest. He’s in Phoenix. He’s a hard money and private lender. Y’all, he played nine years in the NFL. Yes, sir. And he is the owner of 42 Solutions. And I’m excited for us to peek through his lens, get to glean through his experience so we can apply that to our life, right? And apply that to our business. So I’m so excited to introduce you all to Mr. Devon Kennard. Mr. Devon, how are you doing today, sir?

Devon Kennard (02:51)
I’m good, I’m good. Thanks for having me.

Quentin Edmonds (02:52)
Absolutely. No, my friend, thank you for being here, man. Hey, you’ll hit… you’ll see me… you’ll hear me say this at the end, but I think time is our most precious commodity. So the fact that you give us time, I— I— I consider that an honor. So, man, thank you for giving us your time, man, a little bit. And so I— I’m a type, man, I like to dive right in. So I would love for you to tell the people what’s your main focus these days. If you don’t mind, give us a little origin story, kind of how you got into this real estate space. And I already mentioned Phoenix, so we know where you— where you’re operating. But yeah, man, give us a little bit of backstory and tell us where you are today, man.

Devon Kennard (03:25)
Yeah, so I played nine years in the NFL. As soon as I was drafted by the New York Giants in 2014, I started buying rental properties. I built a portfolio of up to 50 properties, mostly in the Midwest: Kansas City, Ohio, Tennessee, and Tampa is where I kind of started. And then from there, I, you know, I kept playing in the league longer, and then I built, you know, a pile of money. And I’m like, “Okay, I’m not able to buy single family as fast as I wanted to.” So then I started investing passively in syndications and funds. So that’s like bigger projects where I’m a passive investor. And I was doing that. I made over 50 syndication investments, and, you know, well into seven figures, was doing that for a while.

And I started to transition about in 2019 going into 2020. And what I started to see was the single family properties I was buying, they weren’t cash flowing like they were early in my career when I was trying to buy as I was trying to buy new ones in 2020 and beyond. And then I was looking at syndications and funds, and I had a lot of money in there already, but I started to see that I didn’t like that I had no control. You invest in these deals, they’re other people’s projects—you gotta just sit and wait till these things exit. So, you know, I was approached by a couple of real estate professionals I knew who were like, “You know, I know you have some capital. Would you mind lending to me on a project?” I did it. I did it. I did like about three or four different loans. And I’m like, “You know what? I kind of like this.”

So as I was trying… retiring from the NFL in 2022, I looked at everything and I was like, “All right, I did these four loans. Let’s see…” looking at how those performed and where that was at, my syndication investments, and then my portfolio of real estate. And I was like, “What fits and what direction do I want to go moving forward?” And I really love the cash flow and actually the idea of building a business around cash flow—a high cash-flowing business like lending. And I was like, “You know what? I’m gonna lean into this.” That’s when I started 42 Solutions, and I kind of just hit the ground running in 2023 and I haven’t stopped since.

Quentin Edmonds (06:16)
Yes, sir. Man. Thank you, sir. Thank you for telling us a little bit about the journey, kind of how you got to where you are now, what it is that you do. And now, sir, I’ll… I have a statement where I always say destiny has no wasted moments, right? Destiny has no wasted moments. We are building to the people that we are through every leg of the journey—through the success, through the failures. It’s reinforcing the people that we see in front of… the people that we are today, right? And so I would love to know, sir, what has your journey taught— taught you about yourself? Has it revealed discipline? Has it revealed… made you humble? Has it increased your tenacity? Like, what has these moments, particularly within this real estate space, revealed to you about yourself?

Devon Kennard (06:56)
I would say it speaks to the importance of growth. I feel like so— so many people get complacent, and that’s what’s dangerous. If you’re not constantly trying to grow and learn, you get left behind. And you know, I guess I learned that from all my years playing in— in, you know, the NFL, and even before in college. But I see it in business as well. Like, things are constantly changing and evolving. And if you’re not intentional about growing and learning and challenging yourself, and “Is there a better way?” and weighing options and things like that, then I think you’re putting yourself at— in a position where you’re not gonna have as much success going forward as you had in the past, because it’s gonna take a new version of you to be successful going forward, because there’s always things evolving and changing. So I would say being a person who is a constant student is something I— I’ve— I’ve learned about— about myself, and I’ve… and I really believe in, because, you know, how my business looks today, it looked a lot different two years ago. It looked a lot different six months ago. And I— I think that’s important and intentional.

Quentin Edmonds (08:02)
Yeah. No, man, thank you, sir. I— I… so one of the reasons why I asked that question, one of my mentors told me, “When you know who you are, you know what to do,” right? And so at the— at the center of all of our businesses is us, the business owner. And so I love how you talked about the growth mentality, man. Like, this one constant thing in the world is change. And if you’re not involved and you’re not changing, you’re gonna get stuck. And so I re— I really appreciate that reflective answer, man. I’m gonna talk a little bit on the operational side, right? So I would love to know which one operational thing that you’ve put into place, let me say the last two years, that has really helped you be successful in the way you do business then?

Devon Kennard (08:41)
I would say I was… I would speak to software and leveraging AI and things like that has been a huge, huge piece for me. I’m very bullish on lean businesses. You know, lean small businesses, they’re not as sexy, but, you know, you can make high net margins by having a small team, having your processes, your SOPs—they call them standard operating procedures—having the software you need to support and implement what you’re doing, and then leveraging AI in a impactful way.

So I would say adopting that these last two years, it’s put me in a position where I have a small team. It’s, you know, it’s myself, I have an executive assistant, a servicing manager slash bookkeeper, a marketing manager, and then my wife handles all of our valuations in the business. So it’s a team of four or five of us. And I think we can, you know, scale the business to where we have fifty million dollars out in the street one day with maybe just one or two more hires max. And it’s because the s— the SOPs we put in place, the software we have, and the ability we’ve already implemented in leveraging AI to where my team has the capacity to— to manage so much more by leveraging, you know, the software and the AI tools that we use.

Quentin Edmonds (10:02)
Yes, sir. Again, man. Thank you again for that reflective answer. What’s next for you, man? What’s the next real goal? What are you looking to solve at scale next?

Devon Kennard (10:46)
I would say just continue to grow. I mean, I— I think businesses need to really identify their strategic moats in their business. And that’s something I got from like Warren Buffett and Charlie Munger. And, you know, I mentioned offline with you before, but I consider my three moats in my business and me professionally in general is autonomy—like, having the ability to run my business in a way exactly how I want to. And in my business, how that looks is I fund the loans that I’m comfortable with and I can do things that other lenders can’t.

Another moat of— of mine is brands. And, you know, that— that goes with my marketing. No one can copy my story being a nine-year NFL player, investing in real estate, having a private lend— private lender. So there’s a lot of people who can say they do hard money or private money, but not with my story. So leveraging into my brands. And then the last one is— is local expertise and the expertise I have in my market. And in real estate, I mean, this is 12 plus years going now that I’ve been a real estate investor. So, you know, I have expertise in the space and I— and I invest and I do my business locally where I really understand the market. So when I lean into that, and I encourage any listener, my— my question to them is: what is your strategic moat of— of you and your business that sets you apart, that gives you an advantage in your market or in your, you know, mode of business? And leaning into that’s been— been huge for me, for sure.

Quentin Edmonds (12:12)
Love it, man. So you— you mentioned a little bit about, you know, some of your, you know, relationships, you know, people who you look to for inspiration. So how does… what’s your philosophy on relationship building within business? And tell me, what are some of the people who have influenced you? Who are some people that’s in your corner that help you do business? Talk to me a little bit about relationships, sir.

Devon Kennard (12:35)
Say this is… this is ironic. So I’ve gotten to the point now because I’ve… I read even today. I read a lot of books, I listen to a lot of podcasts, but I’m past generalization. So I’m in a place where I need very specific, like, “How does this apply to what I got going on, to the situations that are presented to me?” So I still read a lot, I still listen a lot, but I find myself gravitating towards information that’s very targeted. So there’s a— a couple of podcasts I listen to that’s specifically about private and hard money lending and the mortgage industry and stuff, so I love those. Beyond that, I’ll listen to like general business and just understanding how people view business and operations, and I’ll take that information.

But my number one way of really like learning and mentorship now is I have a Board of Directors inside of my Claude and in Chat— ChatGPT, and I’ve spent a lot of time building them out. You know, it’s Warren Buffett, Charlie Munger, Howard Marks, Alex Hormozi, and a guy named Greg Crabtree are my five people on my board. And I’ve— I’ve asked it to take every book and every publication that these five individuals have done and— and what’s their philosophies on money, on business, on investing, and then I’ve given them the information on my business, on my thinking, on my moats, which I’ve mentioned and all of that. And I have conversations with Claude all the time because it’s more specific. Like, you know, I don’t want to just hear about how Warren Buffett ran Berkshire Hathaway—how would he… what would be his likely opinion on this scenario I have going on inside of my business today? That’s the kind of advice and intention I want.

So I found myself using that a lot. I do have a— a couple of like individual mentors that I talk with and stuff like that, but it’s just hard because they’re not always up to date with what’s current in my business today. So it’s kind of like they’re— they’re giving me advice with only a piece of the picture, and it’s hard to get them completely up to speed. So, you know, I’ve— I’ve actually found myself… I lean on that a lot on being able to have those conversations with— with Claude. And not that it’s the end-all, be-all. I still, you know, reflect on a lot of different things, but it is a big reference point that I lean into.

Quentin Edmonds (14:52)
Yeah, I love him, man. 42 Solutions, sir. I— I believe that there’s power in names. I believe we name things for a reason. So what’s the story behind the name 42 Solutions?

Devon Kennard (15:43)
My number growing up ever since high school was 42. I was 42 my entire career. The only place I wasn’t 42 is when I was drafted to the New York Giants, and that’s because it was retired already. So 42 was retired, so I had to wear… I wore number 59 there. But so… and then Solutions is like, you know, I want… I— I want them to… 42 is a representation of me. That’s a number, my favorite number and a number, and then Solutions is I’m providing solutions to the people that I provide capital to, and I want them to know it’s— it’s me providing solutions. So that’s kind of the backstory, and— and it’s unique. You wouldn’t necessarily tie it to lending— lending in any way necessarily, but I think that makes it unique. You know, before Apple was Apple, you wouldn’t say Apple was an iPhone, you know what I mean? Like, we would think of the fruit Apple. So, you know, that— that was kind of my reasoning and thinking behind it.

Quentin Edmonds (16:34)
Love it, man. So listen, is… I’d ask you a lot of questions. Is there anything that I have not asked that you want to talk about? Like, for instance, maybe you came in with a thought in your mind like, “Hey, I’m going to make sure I say this about my business,” or “I want to make sure the audience know this from a vantage of maybe inspiration or education”? I kind of just want to open up the floor that if you came in with the message, you can stick and land it.

Devon Kennard (16:59)
I don’t know. A thought I had while we’re just talking… if that there’s a lot of business owners and people in real estate, make sure you’re reverse engineering your goals to the business you’re running and to what you’re— what you’re trying to do. Because for instance, like in my space, you have to know the kind of business you want to run. Like for me, I’m— I’ve strategically made decisions based off of the idea that I want autonomy and control of my business. I don’t want a hundred person team and and have to manage all that. I have young kids at home. I played a long time in the NFL. I was, you know, fruitful enough to make good money there, so I— I’m not willing to sacrifice certain things to try to build some large company.

So that’s a— that’s a guiding factor for me in how I build my business. I think too many people get into industries or start businesses without clarity of how they want to run and operate their business and what their actual goals are. So I think my challenge for any listener out there is kind of like, you know, make sure the business you’re building aligns with the goals you have set for what you want your life to look like and the kind of business you want to run. And then— and then be aware of the sacrifices you’re making. Now, I think I’m intelligent enough to go and run a hundred person team and have this big lending company, and you know that could sell for a lot… large multiple, I can make a ton of money that way.

But I’m willing to sacrifice that. I don’t want to build that because I want autonomy. I want to be able to go on vacation with my families and not have to worry about it. I don’t want to have to manage a large team. So, you know, as I’m talking to people who are business owners who are building their own businesses, you know, it’s a question I ask is like, “What are you building towards? What— what kind of business do you want?” And I think I challenge that to every listener to— to know and understand that about themselves.

Quentin Edmonds (18:48)
Yes, sir. Man, so well said, sir. Hey listen, man, if someone wanted to reach out to you, connect with you, collaborate with you, learn more about what you’re doing, how can they get in contact with you, sir?

Devon Kennard (18:58)
Reach out to me. My email is [email protected] —so spell it out, “we are,” and then the number 42 solutions.com. Feel free to reach out. Anybody who likes my frame of frame… how I frame business and investing, I have my own newsletter. Head to devonkennard.com where I put out a weekly newsletter. So feel free to— to go to devonkennard.com, subscribe to the newsletter, and every Wednesday 8:00 AM, you’ll be— you’ll be hearing from me with just insights on investing, business, real estate, what have you. And yeah, that’s how to get in contact.

Quentin Edmonds (19:31)
Well, Mr. Devon, sir, let me say three things to you. First, thank you for your time. I’m saying it again, I think time is our most precious commodity. And so the fact that you gave us some of your time, I appreciate that. Like— like I know how podcasts work, right? Like, we got to have guests, but still, I can’t do this episode by myself. And so this time… your time is very precious. So thank you, man. I appreciate it. Secondly, thank you for just your stories, your gift of authenticity, and I even say, like, the gift of your vulnerability, right? You shared things with us you didn’t have to share. And so I think those seeds get planted. We don’t know when they’re gonna take root, but the seed is there. So I appreciate you coming through, sprinkling some seeds, man. And then lastly, sir, thank you for your mindset. Thank you for the way you think, sir, and bringing that mindset to this platform. I greatly appreciate you coming on today.

Devon Kennard (20:16)
Yeah, no problem. Thank you. I appreciate it.

Quentin Edmonds (20:18)
Absolutely. So listen, y’all heard Mr. Devon. His information is in the show notes. Please get in contact with him. But definitely make sure you’re subscribed here, ’cause I promise you we’re going to continue to bring up amazing people, just like Mr. Devon. So, sir, I say thank you again. And everyone else, y’all have a fantastic day.