My First Million · Hubspot Media
It's a rare case of a founder handing over the actual purchase price, build cost and sale price on three deals in a row, so you can judge a romantic-looking business on its real margins.
Tap a chapter to open that moment in the transcript; the link to it is copied for you.
“It's the cost to carry it. It's in time. Time will kill every deal, and often it does.” Mark O'Brien · at 3:52 — open in the transcript →
“I'm a yuppie guy who's trying to dress like a blue collar guy.” Sam Parr · at 2:33 — open in the transcript →
Sam Parr found Mark O'Brien on Instagram — a 63-year-old who buys wrecked New York brownstones, restores them and sells them — and talked his way into a day on site to find out whether he'd trade places with him. They start at 94 Bank Street in the West Village, a 180-year-old house O'Brien bought for $5.5 million and is living in while he waits out permits. He'll be closer to $6 million in and thinks it sells for $17 million, but the project has sat for two and a half years on landmark approvals alone: architects, engineers, soil bearing tests, working out where the neighbour's footing sits relative to his. Parr, who admits on camera he's 'cosplaying' in Red Wing boots, draws the parallel to selling products online — the build is the easy part, the permitting is the business.
The second site, a 4,500-square-foot house in Fort Greene around the corner from Spike Lee, is where the economics get uncomfortable. O'Brien paid $2.8 million, is putting in what has crept from $1.8 million toward $2 million, and expects $6.2 million — roughly $500,000 a year over a three-year hold, with every subcontractor and every regulator able to eat into it. He shows off the parts he actually cares about: a 140-year-old floor he found under vinyl and took a grinder to, exposed original brick where plaster had cracked away, a rubble-and-horsehair cellar he'll finish because floor area ratio doesn't count below grade, so it's effectively free square footage.
O'Brien's origin story is leverage and desperation. He got into real estate over-leveraged with two and a half kids in a Greenwich house he couldn't fix himself, bought his first place for about $800,000, put about $800,000 in and sold in under a year; the next one made him a million and he started running four at a time, prospecting by jogging past old ladies' houses with a stroller and leaving his number in mailboxes. He also owns Broken Shed, a New Zealand vodka distilled from whey.
Back at the office Parr runs his scoring rubric. Business: money machine 3, can-it-run-without-him 3, moat 2 — eight out of thirty, a lot of work and real downside risk for the money. Lifestyle: pride 9, people 7, freedom 5 — twenty-one out of thirty, dragged down because in the thick of a project weekends are included. Total Sam score, 29.
New York developer who buys, restores and sells brownstones — currently 94 Bank Street in the West Village and a Fort Greene townhouse, after earlier projects on Greene Avenue and Vanderbilt Avenue. Also founder of Broken Shed, a New Zealand vodka made from whey.
Our own transcript of the public episode, with a timestamp about every 75 seconds. Tap a timestamp or the link button on a paragraph to copy a link that opens this page there.
0:00Hey, everyone, this is a very special episode. It's meant for YouTube. So I know you're listening to this right now on like Spotify or Apple podcast or whatever, but go to YouTube right now and watch it. This episode is where I go with a guy named Mark, who I found on Instagram, and he restores brownstones. And I asked him everything about his financials, how the business works. But it was a very visual thing. So we decided to make it a video. So again, go to YouTube, or you could just listen to it right now. You're probably at the gym or on your way to work. But hope you guys enjoy this episode. Let us know in the comments if you want more of this type of stuff. And I hope you like it. I feel like I can rule the world. I know I could be what I want to put my all in it like no days off on the road. Let's travel. How much did you spend on it again? 2.8 to buy it 2 million to build it. That's 4.8 in never look back. This place, how much did you spend on it again? $2.8 to buy it, $2 million to build it. So that's $4.8 in, and you're going to sell it for, what did you say, $6.5? $6.2. I saw this guy on Instagram the other day. His name's Mark O'Brien. He buys and restores and sells brownstone homes in New York City. I thought it sounded awesome, and I thought, I don't want to make my living using screens all the time. I want to figure out how his life is, how his business is, the economics so i call them up i'm gonna spend the day with them we're gonna figure out all the numbers and if this is actually something cool to do is his business actually any good is his lifestyle any good do i want to trade places with him and at the end of this video
1:15i'm going to give him a sam score we're going to look at the economics of his business does it make a lot of money and then we're going to have a lifestyle category where we ask ourselves is this actually something that you feel pride in is Is it a good lifestyle? So, let's get through it. Oh. I up. I messed up. I can't even figure out how to use Apple Maps to get to where he lives, let alone build a freaking brownstone. All right, so let's go this way. Okay, so he DM'd us where to meet him. It's 1145, we're a few minutes away. We're gonna walk a couple blocks. This guy, he looks like the Dos Equis man, like the most interesting man alive. He's got these kind of like movie star good looks, and I don't know too much about him other than he looks awesome, he has a cool job. And so where we're meeting is at his apartment. And then we're going to go to a townhome that he's currently restoring, as well as a commercial property that he's restoring. I'm excited, but I'm a little nervous. I don't want to look stupid because I know nothing about like construction. I'm wearing Red Wing boots. But the reality is I'm cosplaying. I'm a yuppie guy who's trying to dress like a blue collar guy so like hopefully he doesn't call me out on that but it's the truth mark o'brien
2:33what's up dude sam what's up my man hey man all right nice nice to finally meet you yes we're gonna start with this place so where are we now this is your your house? 94 Bank Street. It's a project, but I'm living in it. So look, I usually buy things that have rats in the cellar and holes in the roof and water damage everywhere, mold and problems. But this one, when I walked into it, I was like, this is cute. How much did you pay for it? It's 180 years old. It's 180? 180 years old. I mean, it's super old. How much did you pay for this place? Five-five. How much money are you gonna have to invest in it? At this stage, closer to six. How much can you sell it for? 17. Can we see it? Yeah, let's go in. Hey, really quick, guys, if you're interested in this, and if you're interested in that blue collar lifestyle, which frankly, I am, that's why I'm making this video, and you wanna start a business in this space, we have put together this thing called a Blue Collar Business Database. It database the database with hundreds of different business ideas where you can use your hands you could start immediately lots of different metrics about why the business is potentially interesting and so if you're interested in that click the link below totally free all right now back to the episode so when I walked in these shot these floors were shiny I just you know it just glistened I thought I, I love the floors. I came in here. I love the fireplace. And speaking, we talked a little bit about buying the old furniture. I'm really not fancy. I love
3:52just stacking my... I love living in the West Village, which is super fancy. But people are like, you bring all that firewood in? Where are you going to put it? This is the beauty of living in a house that's banged up. It's insane that a home that's going to sell for 17 million dollars you are stacking. That's not how they're going to use it. That's right. So when do you think this will be done this project? So it's been two and a half years that I've been waiting for permits. You know it's landmark. Do you just sit and do nothing? No it's it's a lot of work of architects, engineers getting soil bearing tests. You know, they've got to break up the foundation down below in the cellar. And I can show it to you. And then they want to see, where's my neighbor's foundation? Where's the footing? Where's my footing compared to their footing? But it's like just getting the permits and doing all this regulatory stuff. It seems like that's the thing that... When people talk about products that they're going to sell on the internet, they think, it seems like that's like the thing that, like when people talk about like products that they're gonna sell on the internet, they think, oh, my product's amazing. I'm like, yeah, but like the reality is you have to be a good marketer. 70% of the value is like, are you good at like buying ads online? With this, it's like, well, I can build this amazing place. I can make a profit on it. I can do it cheaply, but it's like, yeah, but can you spend the years like jumping through the hoops of like getting approvals and all this other stuff that you didn't like it's the cost to carry it it's in time time will kill every deal and and often it does can we
5:13see the rest yeah so and actually so this is funny because I'm using this as my bedroom because I moved in I thought I'm gonna be here for six months maybe a year and then it's gonna be a demolition, I'm gonna be here for six months, maybe a year, and then it's gonna be a demolition site. I'm gonna restore all this, so there's gonna be plastic up everywhere and workers running around, so I'm gonna just keep the footprint here and let's start working upstairs. I don't know much about real estate, but the limited amount of stuff that I've done, it seems like everything costs way more and takes way more time. Yes, yeah, it's just out of control. And it's getting worse and worse. So this is my desk, my office. Look at this fireplace here. I mean, isn't that... Is this your brand? Oh, that's my vodka brand. Yeah. Broken Shed New Zealand vodka. I make it from whey, 100% New Zealand products, water from New Zealand, whey from New Zealand, which is... This is a business that you own and started? Yeah. I spoke to a guy about this recently and he was like, well, how did you get into real estate? What was that thing that made you get into real estate? And I said, desperation. I was freaking out. I had two and a half kids. I was living in Greenwich, Connecticut in a house that I had no right... Was it a fancy house? No, that's what, no. It was like a thing that you were going to fix. Yes, exactly. Well, it was something that I would have had somebody else fix. Right. Okay.
6:31Because I wasn't building houses. So it seems like maybe you took a project that maybe was a little bit over your head and then you're like, well, I have to make it work. Right. Yeah. Got it. Exactly. And did that work? Yes. Yeah. And that's kind of always how I've lived. So you're like, and that was like how you got into real estate. Yes. It was, it was, I was completely over leveraged. So I'm a big, big believer in, in leverage and use other people's money, the bank's money. But it's a great way to go broke and get yourself in a lot of trouble. And I know people that have done that and hasn't, hasn't worked out very well. Dude, that's like how so many great things happen. Particularly, I'm, I just turned 37, but like, I think about this all the time like if I lost it all okay I have young kids. I'm now like a proper man I have people who rely on me and like if this goes like it's my job to like You know to take care of this group It's like the most emasculating feeling ever of like shit I have not taken care of the thing that I'm supposed to take care of. I feel behind. And now it's my back against the wall. And I have to, and it's like, well, that's the beginning of a great story. Hopefully it's going to be a great story. But that's like a very scary primal feeling. I have nightmares about that as like a dad. Did you? I think, hey, should we also, do you want to walk out, step outside? And now the sun's coming out. Hey, let's take a quick break. You know that feeling when strategy is done, the brief is written, everyone's aligned,
7:48and you realize someone still has to sit down and actually create all the content? That someone is usually you, and it's due tomorrow. Well, the Breeze Assistant from HubSpot can help. It works right inside HubSpot. You can draft a campaign copy, blog posts, emails, all in your brand voice, all using your actual customer data. So you don't create just content. You create content that converts. Check out HubSpot.com, the agentic customer platform for growing businesses. How many? So you've been doing this? How old are you? How old are you? I don't know. Come on. 55? 51. 51? I don't know, man. See, this is why I hate playing this game. No, I'm not. I'm 63. Oh. I hate that game. Oh. So do I. I usually say, go fuck yourself. I'm not playing. Your specialty, I think, is townhomes, right? Townhouse is brownstones restoration. How many have you bought and sold? So this is my third big project of restoring brownstones. So 62 Green Avenue in Fort Greene, 428 Vanderbilt in 94. So this is my third big project of restoring brownstones. So this is my third big project of restoring brownstones. So this is my third big project of restoring brownstones. So this is my third big project of restoring brownstones. So this is my third big project of restoring brownstones. So this is my third big project of restoring brownstones. So this is my third big project of restoring brownstones. So this is my third big project of restoring brownstones. So this is my third big project of restoring brownstones. So this is my third big project of restoring brownstones. So this is my third big project of restoring Browse. So 62 Green Avenue in Fort Green, 428 Vanderbilt and 94 Bank Street. And then I've got other projects like in Crown Heights, one over here on Jane Street that I act as the owner's rep. So I don't own it, but I run the project. And then before that, you were just selling real estate.
9:05No, but I borrowed against my house so I could buy another one. That's insane that you would get into this business without knowing anything about it. And at a big, high level. So how much had you, you took a loan out, what was your? So the numbers on the first one and the numbers back then were basically you buy for a million, bill for a million and sell for three million, and sell for three million. So you make a million bucks. So this house was $800,000. I built it for about $800,000. And I made a lot of mistakes. I mean, crazy. So you were in for one sick. Yeah. And I sold it for like two, three or something. Over how much time? Like less than a year. So that's like a double, right? Is that a double or is that a home run, right? I mean, it could have been, but the next one I made a million bucks. I was like, I like this. Okay, so you're like, I'm good. I'm good at this now. So I started doing more. I did four, I would get like four going at a time. I'd buy a piece of property. I would go, I'd run with my kids in a stroller, three of them. And I'd see an old lady. I'd like I love your house I got these all these kids look at these kids I'm trying I'm always I'm looking for something a little bit bigger I live over on rocky point right now looking for something bigger and this woman Pat's like oh yeah hi kids you know yeah well give me your number and I give her a number and I would do that put it in mailboxes I just
10:21it was a numbers game so it's kind of like boom and bust a little bit. Yes, very much. And it's funny, I mean- Does that stress you out? Yeah, but I've gotten good at it, I think. You know, I do a lot of yoga. I thought it was gonna be like camera shit all day and it's like fun. No. You wanna go see the- Yeah, let's hit it. This is huge. How big is this one? Yeah, so this I bought like two-ish years ago. So this has taken me way too long. What's the total square footage? So now it's like 4,500. Okay, so you paid 2.8. How much are you you gonna put in uh i'm putting in 1.8 that's turning into more like 2 million and what can you get for it six two it's pretty slim so check this out this is this is super cool this i just discovered it like maybe maybe uh three months ago i it was it had plastic vinyl floor over it and i just assumed it was rotten and i was going to sweep it out or something and and i pulled on pulled on a piece of the plastic and it came up and i was like i wonder what's under there this would be like 100 years
11:40old right paint on top of yeah this is 140 years old and uh so i took my grinder out and started grinding and man i'm finding i find this so look some people say yeah it's it's kind of banged up you should really just put something over the top of it nice and sax tile i'm like i don't care so i this is all an extension here so this two's two things that I do. I like to go onto the roof. I like to finish, or three things. The roof, the cellar, and I widen the staircase. So you can kind of light and a bulkhead on the top so you get light down the middle and then this is all you know original original those bricks are those original yeah so and this also these bricks are 140 years old yeah that's pretty awesome so that's another thing i exposed the brick so this has sheetrock on it when i buy it so i rip the sheet rock down or not sheetrock plaster but usually the plaster starts cracking and it decays against the... So 140 years ago was 1880, right? Yeah. Yeah. Or 1890? Yeah. So someone made that in 1890. That's pretty crazy.
12:56Yeah, wait until you see the cellar. The cellar is literally rock, horsehair, and mud. Let's see it. Is the way they made these foundations. Anyway, so this is a typical rubble wall, right? So you've got rocks. I grew up in a basement like this and it smelled exactly like this. Yeah, it's funny. I love it. So I wanted to keep all that exposed, but I also think it's important to get as much usable space as you can. This will be finished? And this is basically free square footage. Because in terms of FAR, floor area ratio, they don't count a basement because it's below grade. So I try to make it. And right now, you're not seeing it at the best. I got to put baseboard on, finish the floor, and really spruce it up. So it feels like it's real space. It's not a so how much you think this home will sell for? 6-2. What type of person would buy this house? What kind of person? Like what would the job be? Probably like you know yeah I get a lot of creatives here in Brooklyn. Like actors? Ford Green. No more like people like these days in social media and doing some some kind of media business. That's crazy. Maybe you'll be buying a $6 billion home in Brooklyn. So this is a rental, basically. So you come under the stair. Oh, wow. So there's your own entrance here.
14:12And this will be like a $5,000 rental or in-law suite. So you come in. You've got your fireplace, original, big open living room kitchen washer dryer bathroom bedroom oh and they would get the backyard bedroom so two bedrooms washer dryer i know it's in a weird place and then a backyard so this be done how How much longer? I'm hoping to have this, you know, photos taken like in two weeks. So this will get, I'll put like a- What does photos mean? Like pictures and start marketing it. But it's not gonna be done in two weeks. No, but I can start selling it and start promoting it. So when do you hope for this to be sold? End of the summer okay move in would be went like September oh all right cool so you're nearing the end of the two-year project yeah so this gets this will get pavers do these guys work for you are they their subcontractors so everybody these days is a subcontractor nobody's yeah I'm not hiring a whole crew of people but you're going to come out of pocket with it yeah dude there's so much risk yeah all right i work on i work on a computer
15:31all day this is my work or this is weird but talking to a mic we get it i want to do like you want to bust you want to bust something let something. Let's see if we got something upstairs. All right, let's see. Okay, so you probably have heard this on the podcast, but if you're running a company, I think that the number one attribute that will determine if you are going to succeed in business is how fast you can learn from others, specifically how fast you can learn from other entrepreneurs. But there's a problem with that. I have this problem, and in fact, you probably have it too. That's one of the reasons why you listened to my first million in the first place. The problem is that finding other successful entrepreneurs to learn from, it's a pain in the butt. And so that's why a few years ago, I started a company called Hampton. You can check it out at joinhampton.com. We have thousands of members and they exist for this exact reason. So here's how it works. If you're a founder that does at least 3 million in revenue and you make it through our incredibly thorough vetting process, we then match you and put you in a group with nine other entrepreneurs. You meet in real life in your city once a month and it becomes your peer group that will frankly change your entire life. It's changed mine. I'm in a group as well. And so if you're a founder that does at least 3 million in revenue, check out joinhampton.com. Again, the URL is joinhampton.com.
16:53What do you think? You want to see? Yes, I'll do that. Let's get you dirty, right? My man, can I get him to cut it or you want to break it? he cut just for one minute just one one minute he's he's not a spaz are you all right with this let's do it but you gotta be yeah you gotta be careful when you hit that you know really hold it tight can you cut that all the way through all the way through? All the way through, right? All the way? Oh my god, this is so dangerous. Good. So, what was he saying about the story about getting sued for being too dangerous? Yeah, I mean, if OSHA showed up... Thank you, sir. I'm sorry to mess up your workstation, but let's see. He's showing me how he worked out when he was in jail.
18:11That's right. Oh, there it is. That's pretty good. Oh, wow. But did I expect that? You should put that on your hinge profile. All right I'll try. Are you goofing with me? Not nearly as good. That's good and aggressive. You're just like right because you can probably do it on your skateboard. No, I can't do that on my skateboard. Well, I know I can't do that. Okay, we looked at his Manhattan place. We just looked at his Brooklyn place. This place, how much did you spend on it again? 2.8 to buy it and then about 2 million to build it. So that's 4.8 in and you're going to it for, what did you say, six and a half? Six point two. Six point two, and that's over three years. Right. So you'll make something like $500,000 a year. So if you wanna buy a $6 million, 45 hundred square feet, right? Yeah. Home in Fort Greene, this place is awesome. Around the corner from Spike Lee. What a good time for him, right? Deal of the century. All right, thank thank you very hospitable we're gonna get our subway all right god bless see you soon all right thank you for everything
19:30i'll talk to you a little bit all right we just got back to the office let's give this thing a score okay so i've divided this thing up by business and lifestyle because they're both important we're gonna do money machine and mo and first of all i love mark i'm gonna hang out with mark again but in terms of money this business was a pain in the butt and I don't think it made that much money I'm gonna give it a three basically I think that he probably does something like five hundred thousand to a million dollars a year in income but that's on a good year on a bad year he probably can like lose money and it was just a lot of work for that amount of money second machine can it run without him and he has a team of people that that amount of money second machine can it run without him and he has a team of people that he uses in most of his projects but he's really like the catalyst for this whole thing working i'm going to give it another three and for mo the biggest mo here is i don't think people are crazy enough to do this but anyone with enough money could probably do it there's a lot of people in the city who can i'm going to give it a two so what does that sum up to an eight so the business score an eight out of 30. all right now let's do lifestyle so can you have pride in the product that you're making do you like the people who you work with and your customers and does it provide any freedom so for pride he was very proud of what he was doing. I was actually proud for him.
20:46I thought it was amazing. I'm going to give that one a nine. He said that sometimes he'll make stuff and like the buyer will just come in and like destroy it, which would really suck, but he still gets a nine. Now people, I met some of his coworkers, some of the guys doing work. It was awesome. They were really cool and lovely. I'm going to give it a seven just because some of the people who he sells his properties to, I probably don't wanna hang out with some of those folks. And now freedom, I'm gonna give this one a five. The reason I'm gonna do a five is because each project has an end date, so he could take some time off if he wanted to, but when he's there, like in the thick of it, it seems like Saturday and Sunday is included. He's always on the phone, like dealing with regulations and things like that. So the lifestyle score gets a 21 out of 30. All right, so here's what that adds up to. For business, he gets an eight. For lifestyle, a 21, 21, 21. You wrote a 31. For biz, he is gonna get an 8. Lifestyle, 21. Add all that up, what's that up to? That's 29. So Mark O'Brien, buying, restoring, selling brownstones. Sam's score, 29. I feel like I can rule the world I know I could be what I want to
22:11I put my all in it like no days off on the road let's travel never looking back all right let's take a quick break to talk about a podcast because if you're listening to this you like podcasts and what's better than one podcast another podcast and let me tell you another podcast you should check out it's called success story if you like listening to this, you like podcasts. And what's better than one podcast? Another podcast. And let me tell you, another podcast you should check out. It's called Success Story. If you like hearing about different success stories and hearing Q&A sessions with successful business leaders or hearing keynote presentations or just checking out conversations about sales and business and marketing tactics, this is a great podcast for you. So check it out wherever you get your podcasts.