GI297: Professional Skateboarder to Real Estate Investor with Mikey Taylor

GI297: Professional Skateboarder to Real Estate Investor with Mikey Taylor

Mikey Taylor was a professional skateboarder who participated in the X games. After retiring from skateboarding, he co-founded a craft brewery that Molson/Coors later acquired. Following that exit, he founded Commune Capital, a private equity firm focused on commercial real estate investing, where he is currently a co-president.

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Charles:
Welcome to another episode of the Global Investors Podcast; I’m your host, Charles Carillo. Today, we have Mikey Taylor. He was a professional skateboarder who participated in the X games. After retiring from skateboarding, he co-founded a craft brewery that Molson/Coors later acquired. Following that exit, he founded Commune Capital, a private equity firm focused on commercial real estate investing, where he is currently a co-president. Thank you so much for being on the show!

Mikey:
Thanks For having me. Appreciate it. So

Charles:
Give us a little background on yourself. Your very interesting background prior to getting into kind of entrepreneurship in general, and how did it lead you from professional skateboarding into entrepreneurship before even thinking about getting into real estate?

Mikey:
Okay, so I, you know, like you mentioned, I started off as a pro skateboarder, which was amazing because my passion turned into a career, which, you know, I got to travel the world. I got to do what I loved, I got to make money doing it. It was kind of a dream come true. But there’s a really big challenge that a lot of athletes face, more specifically skaters, which is, one, you don’t make enough money to just retire after your career. And two, being good at riding a skateboard doesn’t necessarily mean that the transition into like what we refer to as normal life isn’t the easiest. So for me, my plan was always to save as much as I possibly could by living off a fraction of the income I was making and then getting that money invested so that I either had a cushion or had this vehicle that could help me in that transition. And then the second part to it was I didn’t go to college. I’m an eighties baby, so I grew up believing that if you don’t go to college, you can’t have a successful career. And so I think I just always felt like if I was gonna do anything, I had to do it myself. And so I think that’s probably why I entered into entrepreneurship. I just felt like I had to build the machine because no one else would give me a job.

Charles:
Interesting. Interesting. Why choose going into being a, you know, founding, co-founding a craft brewery as a as kinda your first leap into entrepreneurship?

Mikey:
I think there were two reasons. One, where we were, where I was living, we were seeing just massive growth in the craft beer industry mixed with my age at that time, like I was in my mid twenties, you know, we would go to parties and, you know, drinking beer was like such a part of that life. And I started just recognizing a trend that the beers that people were bringing to events were starting to change. It was no longer your, you know, Miller’s or Budweisers or Modelo’s or Pacific. It was, you know, you were starting to see like ballast point and just some beers that weren’t normal or, or maybe mainstream. And so we started recognizing that trend mixed with this idea that in skateboarding, because our audience is somewhat small in comparison to, to other industries, the size company that you could build wasn’t that large in comparison. And so, like, myself and my partners liked the idea that we could take the way we build brands in our world, which is, let’s call it action sports and apply that to an industry where we could go after everyone, just a much larger audience. And so that would probably be the two reasons why we picked it. How

Charles:
Was that transition? I mean, you’re going from a skateboarder traveling the world as you’re saying you know, an athlete and then going into a, you know, starting your own business and becoming an entrepreneur no matter kind of what industry that’s in. I mean, how has that change and what kind of like difficulties did you encounter doing that?

Mikey:
So there’s some similarities. There’s a lot of differences. The similarities is that when you’re building a business, it’s, it’s brutal. Like people don’t mention the emotional rollercoaster that follows and how every day feels like a just survival, you know, one day you think you had the biggest win because you maybe close an account and the next day you’re going outta business. It’s just hard. And in skateboarding you actually feel that, that how would you say this? You feel a, a lot on both spectrums as well. Like when you’re, when you’re trying to do a trick, you’re scared doing it, it’s a mental warfare. You maybe land it, you feel accomplished, and then the next day it starts all over again, and then you get broke off and now you’re injured for six months. So there was an element of comfort that I had already created through a challenging industry that I think crossed o crossed over into this.

Mikey:
And maybe like a more specific example is for new entrepreneurs, the first time they build a business, it’s very easy for them to feel like it’s not working. And these are all the examples of why it was just a bad idea and they need to just do something else. Every entrepreneur feels that. It’s just the experienced ones know that that’s common and you have to push through it. So I didn’t have to learn that that was already established. I would say the biggest cha the, the biggest challenges and what was very different was managing people and teams and systems that I had no experience in you, you didn’t have to do that as a pro skateboarder. Some of the big challenges we had specifically were our industry. We would produce the beer and then we would rely on distributors to get it out there. And that just meant that they put your product or your beer at, you know, maybe liquor stores or grocery stores, but they didn’t always curate it the way you would want. And so that was a challenge, learning how to manage the distributors to represent our brand the correct way. That was, that was learned. That was, that was a challenge. Growth for us was hard because it was expensive. I mean, there was a lot that we could, the whole podcast could be about the difficulties of startups, that’s for sure.

Charles:
I don’t think many people understand kind of the, i I definitely doubt the like, financial situation of most skateboarders in the sense of I take it you’re getting paid by brands, you are sponsored. I mean, how does that work? And is there any, if you do get hurt, if you do get injured, are any of those contracts you know, are, do they end right there? Do they go on to the end of order? This part, I mean, how risky is that where like every day is a different day? Yeah,

Mikey:
Really good question. So how pro skateboarding works is you, you typically have sponsors that pay you a retainer and that retainer is typically guaranteed usually from anywhere from two to three years. Usually a two to three year contract is what you’re dealing with in that, yeah, there’s clauses that can end your contract early. One of them is if you get hurt and can’t skate for typically a certain amount of time that’s on the individual to negotiate. Typically the skater wants as long as possible. You can also have signature product. So when I was a pro, I had my own skateboards, I had my own clothing line, I had my own shoe line. And so in that you will negotiate a percentage of the revenue that your product sells. And so maybe the most comparable would be like a musician. You have your base or your draw, and then you have your upside on anything you sell beyond that.

Charles:
And you know, this, I was reading this fact like maybe a couple weeks back saying that less than 1% of businesses actually get acquired, which is, when you think about it, it’s actually sounds, sounds pretty true when you’re talking to pe other people. How many entrepreneurs are out there when you know, how did it work with the sale to sell your brewery? I mean, how did that, did you initiate that acquisition? Did Coors come to you or did one of the representatives?

Mikey:
Y yeah, I think that I I I haven’t seen the stat you’re referring to. I imagine that it’s including all businesses and when you include all businesses, it’ll start making more sense on why that figure’s so low. Because a lot of businesses are small business, they’re mom and pop and it’s typically one to, let’s say four employees and the mom and pop business, which is by far the majority, have a very difficult time selling because oftentimes the revenue that the founder owner is taking in is much more significant than the EBITDA or the value that they can get to exit. And a lot of them actually become slaves to the business. ’cause There’s just no buyer in general. Now if you’re building a business to exit, that’s a different thing. And I’d be curious to know what the percentage of that is. I don’t know offhand, but I would where I would totally agree with you, it’s probably still the minority.

Mikey:
Now for us, we had to raise money to start the company. And whenever you’re gonna raise money, one of the first few questions that an investor is gonna ask is, how do I get paid? How am I making my money back? And for us, our strategy to pay investors back was through an acquisition. And how we built the business was with the end in mind. And so, you know, what that looked like. It was a lot of growth, it was a lot of reinvestment, it was capital raises to continuous capital raises to support the growth. And we were growing faster than what I think most would have if that wasn’t their plan. How we went about it, we spoke to a group that was gonna represent us to basically put feelers out there to see who was interested in buying us. And they came back with four or five potentials, the largest in the industry. And then we went through the negotiating process until we landed on two. And then those two, you know, made continuous offers same way you would in real estate when you’re trying to sell a property. And you know, you might ask for last and final. We went through that whole process and then we picked one and then we ended up selling it. Very

Charles:
Cool. Very interesting. So after you sold you, you kind of, you transitioned into real estate what was kind of your choice for doing that? There’s so many different places, probably you could put your money, you could start another business. You obviously know a lot about raising money for businesses, you know a lot about selling them. I mean, going through the whole life cycle. Why transition into commercial real estate? Well,

Mikey:
I was investing in storage at that time pretty heavily, and I was investing in on, on the debt side of commercial real estate. And I always liked real estate probably because my parents had a couple rental properties growing up and mixed with me being an eighties baby. Like we were just always told real estate is the way. And so I always felt a lot of comfort in that asset class. And when I was thinking about the next business to start, it actually happened very organically. I received a call from another pro skateboarder asking me how I was in the position of, you know, no longer being a pro skateboarder, not having a job and not having to worry about making money. And so as I was telling him my strategy, I noticed that a lot of it was how to become financially free. And when I was speaking to him specifically, I was addressing the issue that athletes have, which is the majority of our income starts coming in anywhere from let’s say 19 to on the high end, 30.

Mikey:
And so you’re in your younger years where it is typically wealth build. You’re not really focused on cashflow at this time, you’re trying to like double, triple your money. But the challenge is, I I we’re also trying to figure out cashflow because when our sponsors basically go away, we’re out of income. And so real estate really started becoming desirable for me because it achieved both goals I was looking for. I was able to participate in the wealth build through appreciation, and I was able to get some cash flow from the assets as well. And so as I was telling him why I started investing so, so much in storage, I kind of had this like light bulb moment where I went, oh my gosh, why don’t I create a company that can, you know, do what I did to become financially free for all of my friends?

Mikey:
And so I started the company with skaters in mind and then, you know, I started talking to snowboarders and then it was like golfers and it very quickly became, alright, I’m building this thing for athletes. And then maybe two years in I started realizing that if you’re in sales, you have the same struggle and challenge that athletes have. If you’re working a job that is taking away from time with family, you actually have a very similar pain point as athletes. So there’s more people on the path to financial freedom than I even realized. And so from, you know, the inception to today, we have almost 800 investors now. I think athletes are actually our minority investor, and that’s basically what we’re doing. We’re trying to achieve financial freedom through real estate investing for as many people as possible. And then we have a pretty large educational part of our business that we’re all very passionate about as well. Very cool.

Charles:
So can you break down a little bit about your kind of your firm’s deal investing criteria and your different fund offerings?

Mikey:
Yeah, so we focus on multifamily and storage. Those are the only two asset classes that we’re investing in for storage. What we go after is big box retail that goes vacant, so your Walmarts, your Kmarts, your Bed, bath and beyonds. And then we use a strategy called adaptive reuse, which basically means we keep keep the structure and we fill the inside with storage units. They typically end up, when we’re finished anywhere from let’s call it 1100 to about 1500 units that we put inside of them. Regional, you know, regionally we’re not so niched down on a certain market. The reason being cities don’t like storage the way we do it. Usually a city wants to put storage on the outskirts. And so for us, we found it very difficult to pick one market and then go all in on it. So our storage is geographically all over the place.

Mikey:
As far as multifamily goes, we are much more niched down. We look for distressed assets or land that we can buy and or scrape, and we develop multifamily apartments in Southern California. So we are very hyperfocused on California size range on the small end, for us, that’s typically 30 units. Our sweet spot I’d put us between 80 and a hundred is where we’d like to be. And other than that, let’s see, we, we, we’ll either do a fun structure or a syndication. So if it’s a fund structure, that’s usually three apartments inside of a fund and then every once in a while we’ll we’ll create a single purpose vehicle for investors to come into a singular property. Interesting,

Charles:
Interesting. So, you know, really being focused on California with a high level of regulation, I mean, how does that, I mean, how are you and your team able to really navigate that successfully? I can see with the, with the storage it might be a little easier, but multifamily that might be a little bit more difficult.

Mikey:
So it’s, it’s interesting. The, the answer is yes and no. It, it is actually very difficult to get storage done The way we do it, it’s just a, for a different reason. Cities typically are, are focused on sales tax and jobs. And so when you’re talking to a planning division or even, you know, moving all the way up to city council, they typically don’t want to turn what used to be 200 jobs and x amount of sales tax into something that’s one onsite manager and a fraction of the tax. So we actually see a lot of deals die there. With California, it’s a different beast. California wants multifamily, they want housing. So you don’t get the pushback from your planning department or the city council for that regard. What you have a challenge with is regulation that that’s by far what you’re up against. And so how we navigate that is a few ways.

Mikey:
One, my one of my partners that oversees all our development has been building in California for 30 plus years. So, you know, understands what it takes to get projects through the finish line with city councils. For myself, I am the mayor pro tem of the city I live in, so I actually sit on the policymaking side for our city, which helps when you’re a real estate investor, we, we don’t invest in my city, but when we’re looking at other cities, I know what cities are working through and what the challenges are. I would say the other part is having the capital to participate here and having the bandwidth to be able to get the projects through the, the, the, the unique opportunity in my perspective is it’s so difficult that a lot of investors won’t invest here. And so the end up picking easier markets, you know, I I would say that’s why we saw so much in the Midwest and the Sunbelt states.

Mikey:
But the way I look at it is if California makes it so difficult to build housing, yet it’s so needed and investors look at California as being too difficult and too expensive, what do you think that does to the investors that know how to do it here? Do you think our values go up or go down? They go up, right? Los Angeles is the most unaffordable market in the entire country. Our real estate is crazy here. The reason being, there’s too many people chasing too few of goods. It’s basic e-comm. And so I look at it as an opportunity created by very, very poor regulations in our state.

Charles:
Interesting. So you’ve mentioned partnerships a couple times during this interview here. And you know, how have business partnerships led you to success in both your brewery and what you’re doing now in, in your real estate business?

Mikey:
Okay, so you have two different frameworks. You have an individual that wants to do it all himself and own a hundred percent of the pie, or you have people that want to bring partners in to try to create a bigger entity. The idea being I’d rather own 10% of something huge, then a hundred percent of something small, and I am the latter. So for me, I, I quickly learned coming out of skateboarding what my skillset was, and that was also followed by me learning what my weaknesses were. And so any part, any business that I start will always be done with people. Now, you don’t necessarily have to bring them on as partners. I had enough capital to just pay people to come on to my company when I started it this time. But what I found is when people have ownership in what you’re doing, they, they bleed for it. They, you, you get a different type of focus and dedication and resilience when we’re all in it together. And so I like giving equity to people, I like having partners. It, it, it then just becomes who do I need to help me with the things that I’m not great at? And the first thing for me is an operator or a COO. Second is usually a CFO and then third maybe ranges based on the industry.

Charles:
Interesting, interesting. What would be some advice for an entrepreneur or a real estate investor that you know, right now thinking about partnering? Not sure if they’re gonna do it or not.

Mikey:
I would say a lot of times entrepreneurs stop at the idea like, I have this idea, I just need to go do it. But they don’t spend the time planning out what the idea can actually become and what you would need to do to get it there. It is very worth doing that exercise. Maybe like the most obvious way of trying to figure out what that means is creating a business plan. Even saying it outta my mouth, I hate creating business plans. E every time I have an idea and I start a business, I, I, I like dread doing it. I always force myself to do it because it, it makes you actually build out a plan that is scalable. Like you can build a true foundation this way. And for me personally, once I know where I wanna go, the the question just becomes what’s the cleanest and straightest path to get there? And that’s usually partners, that’s usually bringing people on to get you there. And so if you don’t do that, you might not be forecasting the right amount of time for you to get to your end goal. It might take you 35 years to get there. It’s gonna take you 35 years and you’re, you know, in your mid fifties, you don’t have the time to wait, bring the team on accordingly. So I would say build, build a business plan. It’s really, really important to do it. You know,

Charles:
Over 800 investors, you guys have, and I’ve read that you raise a lot of your capital from investors off social media. I mean, how important is it to, you know, building that personal brand today for what you’re doing now or for pretty much any kind of business? Okay,

Mikey:
People are gonna give different responses to that question. For me, I think it’s everything. So I, I’ll give you an example why. When I was a kid, I bought Nikes. The reason I bought Nikes was because of Michael Jordan and Michael Jordan alone. When I put those shoes on, I felt a certain way because of him. So he created the brand, he created the, you know, relationship with me. I looked up to him, I wanted to be like him. And then the product that I bought made me feel like I was, this is nothing new. Social media has just become a new format to create more engagement or, or maybe get that brand out to more people who are smaller and scale to somebody like a Nike. And so that’s exactly what I’m doing with this company. It’s what we did with our last company. I wanna put a face in front of the business and I wanna make it so that people can connect with an individual, not just the service that my businesses, my business provides.

Mikey:
One of the main reasons why you wanna do that is because, you know, if you’re talking about something like real estate, there’s, there’s not that much you can do that’s separates you from every other real estate developer out there. There there’s only so many deals. Cap rates are only what they are. Rent growth can only be so much. And so if you don’t have a brand and you don’t have something that can create separation from others, you just become one of many deals that people are looking through. And that’s usually what happens when you’re talking to investors. You know, yours is a 88 unit multifamily targeting a 17% IRR, theirs is a hundred unit targeting, a 16% IRR. So it just becomes size and potential return. But if you have something on the brand and you’re creating an experience that others can’t replicate, well now you’re one of one.

Mikey:
And a lot of times people will go with you, even if somebody is promoting something different that may have a higher targeted return, you don’t have to worry about that competition. The other thing I like about it is it makes it easy for people to remember you. I I think this even goes beyond social media. It goes into how you pitch an investment. Most people pitch an investment by talking about the returns and the financials. I pitch investment by story the way, same way you would pitch a brand. And I’ve just found that that helps people remember who I am and makes it so that I look different than everyone else. No,

Charles:
That makes, that makes perfect sense. It’s, it’s one of those things when you get properties or you speak to a broker and about a property or whatever, and they always go into the story about behind the property, what’s going on here, what’s happening. It’s not just hey, this is the, you know, best price we’ve ever had and this is lower than this property that’s sold over here and everything like that. So it’s a very interesting you know thought process for kind of you know, how to differentiate yourself. Mike, so as a, you know, as a professional, skateboarder, entrepreneur, real estate investor, I mean, what are some of the things that have come true to your success over these decades?

Mikey:
Oh gosh. I would say, look, first and foremost, i, I, I believe that I was put here for a reason. I, I think all of my credit goes to the creator, which is God, I think God gave me talents that I’ve been able to maybe sharpen and use some of those talents. I, I think, I think being an optimist is everything. If you’re gonna build anything, you cannot be a pessimist. You have to be a glass half full type of person. Solving problems is everything. I would say the biggest crossover from skateboarding into what I’m doing now was probably just building a, let me think of the, the best way to say this. Learning how to strengthen my mind to handle adversity. That’s probably maybe the biggest takeaway I’ve learned from skateboarding. And so knowing that my company is gonna be put in situations that are gonna suck, there’s gonna be a lot of fires and learning not to panic when it happens, but to actually just put yourself in problem solution mode and that what you experience on the other side is actually gonna be better than, you know, what you went into that situation with.

Mikey:
That’s, that’s probably a huge one. That, that singular ability to keep yourself calm during challenges is make or break for an entrepreneur. No,

Charles:
That’s a lot of great information there. So before we wrap up and you share your company’s information, can you tell us a little bit about kind of where you’re going? Both, what’s next for you, both personally and professionally?

Mikey:
Okay, so professionally currently we are managing about $330 million of real estate. Our next goal is to double that. So we’re gonna try to double that in the next three years. And then in five, we wanna be at about a billion dollars of a UM. So that’s our kind of, at least from a metric standpoint, that’s where the business is, is targeting to grow to, as far as me personally, I’m married, I have four kids raising kids. For anyone who’s a parent out there knows it’s the hardest thing ever. It’s probably all also the most important thing we do. So I have three girls and a boy, and so my personal goal with my wife is to make sure we’re building them up to be, you know, the, the leaders of the next generation. I, I, I want my daughters to be great women. I want them to be confident. I want them to, if they choose, start businesses, if they don’t wanna, I just want them to have all the tools to go after the sky if that’s what they desire. And then my son, it’s, you know, teaching him how to be a man and giving him the tools to succeed when he is older. And I, I think being a leader is a big one too. I, I want all of my kids to have the skillset to lead and to impact those around them. That’s

Charles:
Great. That’s fantastic. So Mikey, how can our listeners learn more about you and and your real estate business?

Mikey:
Okay, for us for anybody who enjoys podcasts, we have a podcast called Life with Mikey that is on Spotify, apple, or you can find it on my YouTube channel, which is just Mikey Taylor. And then I’m on all the social media platforms. Just search my name and I will come up. My business is called Commune Capital and you can do the same thing. You can go on the, all the platforms define that, or our website is commune capital.com.

Charles:
Mikey, thank you so much for coming on today and looking forward to connecting with you here in the near future. Thanks

Mikey:
For having me.

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About Mikey Taylor

Mikey Taylor is a Southern California native, professional skateboarder turned serial entrepreneur, and city council member of his hometown.
Mikey is a retired professional skateboarder who left an indelible mark on the skateboarding world, participating in elite action sports events as X Games.
Transitioning to entrepreneurship, Mikey recognized the potential in the emerging craft beer industry and leveraged his skateboarding-inspired marketing expertise to co-found Saint Archer Brewery. The venture swiftly became one of the fastest-growing breweries in California, subsequently being acquired by Molson/Coors.
Following this triumph, Mikey set his sights on the commercial real estate market, leading him to establish Commune Capital, a private equity firm. The firm holds a central principle of positively influencing the cities where they construct or enhance infrastructure. As President and Managing Principal, Mikey continues to drive Commune Capital’s growth and impact.
Balancing his professional endeavors, Mikey cherishes his role as a devoted family man. He and his wife, Jen, are proud parents to four beautiful children: Scarlett, 11, Amelia, 9, Elliot, 3, and their newest addition, Vivian, 1. They reside in Thousand Oaks, continuing to contribute to the community that Mikey has always called home. He continues to shape his community, not only through his professional accomplishments but also through his dedication to giving back and making a positive impact. His story serves as an inspiring example of how one individual’s passion, talent, and commitment can transcend boundaries, leaving a lasting legacy that extends far beyond the skateboard.

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