SCF 19 | Passive Income Cash Flow


If you want to generate that passive income cash flow, you need to invest. Investing in real estate can be your first step to passive income. It can be a scary thing to do though, with debt, inflation, and all the assets. You need a guide. Well, your one-stop guide to hassle-free investing is here. Join your host Dale Corpus as he is joined by David Campbell, the CEO of Hassle-Free Cashflow Investing. David is here to help you get into real estate investing. Whether it’s on paper or just renting a two-bedroom apartment for income. David will guide you through the process of mortgage notes. Learn about depreciation, tax investing, getting into debt, and more. Generate your hassle-free cash flow today!

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Generating Cash Flow For Passive Income With David Campbell

The idea of getting back into real estate investing after the mortgage credit crisis, when all my properties were underwater, was scary. I didn’t think I ever wanted to invest in real estate again. What got me thinking differently about that was an education for a few years. Education got me comfortable with the idea that it’s okay to reinvest. Around 2012, 2013, I started looking online for resources to learn more about real estate investing.

I stumbled upon the website of our guest, David Campbell. He had excellent content. Things started to click in my head, and I started realizing that opportunity was still out there. The sky wasn’t falling, and I needed to take advantage of it. Sitting on the sidelines wasn’t cutting it. I was super cautious and had a better understanding of what to focus on for investing and a better strategy.

For example, I changed my focus on cashflow for investing versus using speculation instead. Before I start speculating about a property that would go up in value, the fundamentals of cashflow are even more important than that. It worked so well that even the name of my show now is called The School of Cash Flow.

Before I started listening to podcasts, I was watching David’s YouTube videos and reading his blog. He helped reset my mindset back in order with all this reeducation to feel comfortable reinvesting. For that, I’m forever thankful. Here’s a little bit more about my guest, David Campbell. He’s the Founder of Hassle-Free Cashflow Investing and widely recognized as a cashflow investing expert with real estate transactional experience of over $1 billion. David started investing in real estate in 1999 while working a full-time high school band Director job with zero net worth.

Within six years and before the age of 30, David had become a financially independent millionaire through the vehicle a part-time investing. He left public school teaching in 2005 to focus on real estate development and commercial real estate investment brokerage. His company’s investing and advisory experience has included single-family homes, apartments, retail, office, medical, condo-conversion, net-leased properties, syndications, land development, production home building, private lending, and winery.

David has been a featured guest on some of America’s top radio shows and investing podcasts. His blog has been repeatedly named one of the top 100 real estate blogs in America. David, you have done a lot. Without further ado, welcome to the show, David. How are you?

Dale, I’m so excited to be on your show and connect with you after almost a decade of hanging out together.

I’m so glad and honored to have you on. You personally helped jump start my career in real estate investing. I had so much fear, but you were so genuine online. There are so many people online, but I felt like they were selling me something, but you weren’t, FYI. Everything you put out there, all your material, was so excellent. It made me feel comfortable and changed my mindset. You are a fantastic educator. For my audience, who doesn’t know you yet, where are you based out of geographically?

I grew up near Los Angeles, and then I moved to the Bay Area, San Francisco. Now I live in Oregon, on a cattle ranch, raised grass and fruit and some dairy cows, and have an awesome intersection of the ability to connect with nature and seasons as well as taking advantage of being able to work remotely and collect passive income from cashflow and do the things that I’m passionate about.

SCF 19 | Passive Income Cash Flow

Passive Income Cash Flow: Real estate gives the freedom of location, to be able to live wherever you want and work wherever you want. These are far more valuable than the freedom of money.


When I first met you, that’s when you were living in the Bay Area. I remember going to your office over in Vallejo, California, and we were playing Robert Kiyosaki’s CASHFLOW Board Game, which I appreciated. I don’t even remember when that was. Do you know what made you want to move out of state out of curiosity? I don’t think I ever asked you that.

The cost-of-living lift was a big shift. Once I realized that my income was solid, non-locally driven from anywhere, I looked where I wanted to go with this portable income. Being in nature, with trees and clean air, able to grow some of my food, go for miles and miles of walks out my front door, that drove me to Oregon. I can get a palace in Oregon for the cost of a tiny house in San Francisco.

I wanted to go back to your bio. You were a band teacher. Your transaction of over $1 billion of real estate, that’s pretty mind-boggling, especially for many folks that are reading this that might not even invest in real estate. I wanted to dissect that. How did that all happen?

How do you eat an elephant? It’s one bite at a time. I have been doing real estate for many years. It’s simple math, $50 million a year times twenty years is $1 billion. If you break down $50 million a year, it’s a little more than $1 million a week. In that way, $1 billion seems astronomically large. When I put my mind to, “Can I do $1 million of deals this week?” The answer is always, “I can.” Particularly, if you are doing a deal that’s $4 million or $5 million, that’s all I need for the month to hit that number. It wasn’t my goal to do a certain transaction volume.

I wanted to have freedom of location and be able to live wherever I wanted to live. I wanted to have freedom of schedule. I want to work when I want to work, the hours that I want to work. Those two freedoms are far more valuable than the third freedom that people often focus on: the freedom of money. I do have freedom of money.

I have more passive income than I spend. I still work. I like getting in and doing the real estate transactions and helping people. I think about what it is that I do. When I realized that I’m financially independent of cashflow, I’m no longer working for the money anymore. I can show up with the heart like I’m helping these people get the things they want.

What am I doing? I’m helping investors that need passive income. I’m helping them create passive income for their family and needs. On the other side of the transaction, I’m helping families. Usually, immigrant families or self-employed people and not very traditionally bankable get affordable housing to own and take part in the American dream.

I feel connected to our country and culture. Those are things I’m passionate about. The money certainly is nice. I have money that fuels a lot of whimsical dreams. It’s an interesting mind experience to wake up every day and to say like, “I don’t have to work for money but I’m not old. What do I do with this resource of time?” The power that comes from having an abundance of financial resources is a big responsibility.

Real estate is like eating an elephant; you eat it one bite at a time. Share on X

To use my time in the resource of my gifts in a socially responsible way. It’s a beautiful chapter and a privilege to be in this spot where I don’t have to trade my time for money so that I can eat. That cycle of time, money, food the next day. To break that cycle allows for a lot of higher consciousness thoughts to come up. I can practice yoga and exercise every day. I can be very mindful about my food, schedule, the environment or the peer group that I choose to affiliate with.

All of these are very powerful energies that come from the freedom that cashflow provides. Early on in my investing, I didn’t know that these freedoms were waiting for me. It was about the money. It’s like, “How do I make $5 more so that I can work ten minutes less?” Cashflow is one of the most powerful forces in modern society. The most powerful forces are in nature, spirit, and things like this.

In actual interaction with other humans, passive income buys your freedom to live deliberately or with intentionality. What is it that you want to do with this precious life moment? I’m excited for your readers and guests who are on a path of intentionality. How do they break the cycle of time for money rat race wheel to show up in a way that they want to show up?

Many readers obviously work in tech, Silicon Valley, that hustle, that grind, and whatnot. Some of them are looking for that way out. I don’t know if real estate found you or you found real estate. Can you even go back to when you were a teacher? How did you even know that real estate was the vehicle? Did you read a book or did somebody talk to you? I never asked you that. I don’t even know.

I had a strong work ethic as far as I can remember. My earliest childhood memories are like, “How do I start a business?” Even being like eight years old, I remember going door-to-door collecting cans from the neighbors to trade them in for money so that I could buy video games. I could mow lawns. I would go door-to-door mowing lawns. I figured out that if I knocked on the door and asked them if they wanted their lawn mowed, they would say no, but if I mowed the lawn first and then asked for payment later, they would almost always pay me.

I would go down the street, mowing lawns and hoping I would collect. I had that entrepreneurial spirit pretty early. I remember doing a school fundraiser selling cookies. After the fundraiser was over, I was with my mom at the store and saw that the same cookies I was selling for $0.50 a bag were at the grocery store for $0.25 a bag. I call my mom like, “Can you buy me a bunch of these cookies so that I can go door-to-door and sell them?” She did. I went door-to-door to sell cookies.

People assumed it was a school fundraiser but I was doing it to make money to have my own pocket money. Anyway, I had the entrepreneurial drive young. I’ve got a job when I was eighteen, working in an income tax office. I didn’t know this until I grew up a little bit. The lady in the tax office was in the ghetto and wanted to hire someone that could sit with her in the office and then walk her to her car at the end of the night.

This is fundamentally what she wanted. She picked me because I would work cheap and walk her to her car in the ghetto at night. While I was there, she gave me a bunch of tasks to do related to the income tax business that she was running. I had no business doing income taxes as an eighteen-year-old but she taught me how to do it. There I was doing this.

I remember my middle school teacher came in to get their taxes done. I did the entire tax return for my middle school teacher, and I’m eighteen years old. The enrolled agent, in the end, reviewed it and stamped her name on it but didn’t change a thing on this tax return. It’s all software. I realized that this middle school teacher paid a lot of money in taxes. I was like, “I’m going to be a teacher someday. I better get ready to pay a lot of taxes.”

SCF 19 | Passive Income Cash Flow

Passive Income Cash Flow: When the cash flow comes, that’s really one of the most powerful forces in modern society. That passive income buys your freedom to be able to live deliberately and with intention.


This next week, a guy came in, and he owned many shopping centers and grocery store properties. It took me two weeks to do all the data entry on this guy’s tax return. I didn’t do the tax return. I did the data entry. My job, in the end, after the enrolled agent did all of the calculations and the return, was to hit print, staple it, and give it to the guy and say, “This is how much of a check to write to the IRS.”

This tax return was so thick. I was like, “I was expecting this tax bill to be big.” I knew how much money he made. I put in all these data entries. I said, “Your tax bill is $0. No way.” I asked my boss like, “How is it that my middle school teacher is paying 1/3 of her income in taxes, and this guy who I know is loaded paid nothing?”

She’s like, “It’s called depreciation. You are not quite old enough to get this yet. You are only eighteen. How about the best advice I can give you when you get your first professional job, buy a two-bedroom or anything. Go buy it, rent one of the bedrooms out, live in the other bedrooms. You will thank me later.” I was like, “Okay, cool.”

I’ve got my first job teaching high school bands. I moved in with my parents for about 5 or 6 months and saved up enough money for a 3.5% FHA down payment. I’ve got my down payment together. I bought this condo in Orange County. I lived in one bedroom and rented out the other bedroom. That guy’s rent was more than half of my mortgage payment.

I’ve got the depreciation on this condo. After two years, that condo had appreciated more than my gross salary as a band teacher. I went from having no net worth to having this subsidized housing cost by my tenant. I had a net worth. My checking account from teaching a band was zero after two years. I spent everything I made. This condo went up to $60,000. That $60,000 of equity, I was like, “Let me sell this condo, use the $60,000 to buy a five-bedroom house.”

I bought a five-bedroom house and rented out four of the bedrooms. I lived in 1, and my 4 roommates paid the entire mortgage. I didn’t have any housing payments at all. That house, because the market was doing big things back then, went up about $100,000. I was able to go to my bank because I had no housing payment because of my roommates. They had all this equity in this home that I bought. I was able to do a cash-out refinance and then buy another rental and then another rental.

After about ten real estate transactions for six years, I had enough net worth and passive income to quit teaching high school. I stopped teaching high school and thought I was going to be retired. I realized quickly that I couldn’t sit around playing video games for the rest of my life. I needed to find something passionate about.

Let me get into real estate development, which is a big leap from being a high school band director. I did. I bought a 30-unit apartment building in Vallejo with hard money and my entire life savings. I converted it to condominiums and sold each condominium. I only had enough money to fix up one condominium. I did it with credit cards.

As soon as you get your first job, buy a two-bedroom apartment, rent one out, live in the other one, and thank me later. Share on X

I charged all the materials at Home Depot on my credit card and fixed up one unit, and I have to sell that unit and get the money to fix up the next unit. It took two years to rehab and resell the 30 units. That gave me the experience and the confidence to start a home building company in Dallas, Texas. I started building houses in Dallas. That’s about the chapter that you and I met right after building houses in Texas.

I was a real estate club speaker and met Ken Gain, a private mortgage lender broker from Alaska. He blew my mind that he was living life going all over the world, adventuring. I was telling him how much hassle it was being a landlord. He’s like, “No, mortgage notes are where it’s at. It’s so simple to own mortgage notes and collect the cashflow for mortgage notes.” I made that goal. I wanted to get into mortgage note investing, but I didn’t have enough cash to do it. I thought it was a very cash-intensive business to be in.

I hung out in real estate development for a while. I realized at the time in 2010 that banks didn’t want to finance speculative homebuilding. I started borrowing hard money to build houses with. I pretty quickly figured out that there were many people that I knew that wanted to be hard money lenders but they didn’t have the opportunities. After I had borrowed all the money that I wanted to borrow as a home builder, I started arranging for other home builders to borrow money from my relationships and then making fee income that way.

It grew to the place where I was making as much money brokering hard money loans to home builders as I was a home builder. After building about 350 houses, I decided I didn’t want to do that anymore because the number of logistics involved in running that is incredible, and you are always on. It’s a great business but it is not an investment. It’s a very active business.

I wanted to get into the paper. I sold off my home building company and then went into paper full-time in 2015. There are a bunch of other brokerage stories on there. I brokered apartments and did a lot of consulting for some international developers and things like this. Paper is fantastic, the ability to help someone else realize their real estate dream and recognize that they have all of the logistics and the hassle of ownership. I get to rent my money. What I’m doing is I rent my money, and then someone else uses their rented money and pays me interest. That’s the rent on money. That gives me the freedom of time to be in that space of renting my money and letting other people manage the day-to-day situation like that.

Is it mainly all of your real estate investing primarily focused now on mortgage notes? I met you when you had your development company because I bought a turnkey rental from you, which did great. Is all the focus on notes now?

It is for me. I don’t think that’s a one-size-fits-all formula for anybody. It’s like what fits me, my chapter of life, and my level of experience. I’m doing about $40 million a year of private lending, making the fee income off of the origination of that. It creates opportunities for me to have paper, passive income from my portfolio. It’s pretty powerful. The velocity to do $40 million a year, a paper, I can do that with a couple of million dollars of cash.

It turned over every 2 to 3 weeks that creating that velocity and veterans action volume. I would love to be all on paper but I can’t or choose not to because of taxation and inflation. There are some incredible advantages to owning the depreciation on the investment real estate, and mortgage paper is not inflation-friendly asset inflation.

The mortgages that I own, other investments are an asset. To me, it’s a liability to the borrower. These assets are dollar-denominated. They are denominated in a specific currency. When that currency devalues, the borrower can pay off their debts with cheaper money. That is a loss for me because I loan out money that has a certain intrinsic value. When I get that money back, that intrinsic value has declined.

SCF 19 | Passive Income Cash Flow

Passive Income Cash Flow: Going into paper is just fantastic. Having the ability to help someone else realize their real estate dream. To help them recognize that they have all the logistics and ownership hassle.


Inflation in the inflationary cycle that we are in now is, on the one hand, good for lenders. On the other hand, it’s bad for lenders. It’s good for lenders because when there is inflation, it bolsters the underlying property value. When that property value is strong, you are more likely to be repaid on your loan. Your loan losses are, in our case, non-existent. The market has been upward trending for so long. If you are underwriting loans well, in our case, 75% loan to value, it’s almost impossible to lose money in an inflationary cycle where property values are upward trending.

You can lose money in any investment for sure but in lending, the borrower’s down payment is the biggest protector of loss. On the one hand, it’s helping to ensure greater payment performance because of inflation. On the other side, when you get repaid, if you’ve got a note rate, in our case, we put money out about 9% to 10% interest rate. If inflation is at 5% and we are lending at 9%, we are not making 9%. We are making the delta a 4% positive return on our money, but it’s still positive. That way, it’s exciting.

Correct me if I’m wrong, but it sounds like a good amount of your active income is from the fees you are collecting from brokering mortgage notes. I take it that when you invest in your mortgage notes, are you still mainly investing in your self-directed IRAs? Tell me more about that. You are the person that got me into mortgage notes, and I love them, by the way. When you are investing in mortgage notes yourself, is it your outside or inside your IRA? Let’s talk about it.

I like to talk about tax-efficient and tax-inefficient investments and buckets. A tax-efficient asset would be real estate because of the depreciation on it. When it depreciates the value, you don’t pay tax on it in the current year. It’s deferred until sale. You can do a 1031 exchange when you sell. When you die, your heirs get a step-up in basis. In that way, you can hold investment property potentially tax-free for life.

Real estate is an incredibly tax-efficient asset. Mortgage notes are tax-inefficient. The interest income is taxed at the ordinary income tax rate. If you are a high-income earner, your tax bracket is high. In this way, for me, as a high-income earner, my marginal tax rate is high. Therefore, I pay a lot of taxes on the interest income. Tying that back to our last conversation about inflation, let’s say I’m making a 10% yield, and then I’ve got to pay tax at a 40% tax bracket. I earn $10 of income, spend $4 on taxes and get to keep $6.

If inflation is happening at a 6% rate, I’m at a wash. In this way, even though I’m making a 10% yield on a mortgage note investment after paying taxes and inflation, it’s treading water. As part of my mortgage investing strategy, I need to have tax strategies. I don’t want to tread water. I can’t control inflation or the tax strategy. One hugely helpful strategy is using a self-directed retirement account, a self-directed IRA. I have chosen that 100% of my self-directed retirement account is invested in mortgage notes.

The income from that mortgage investment goes to my IRA. The IRA, in the case of a traditional 401(k), is tax-deferred until I take the money out so I can get compound interest on that money. In the case of a Roth IRA, that interest is tax-free for life. Using the tax-efficient bucket of a self-directed IRA, with the tax-inefficient asset like mortgage notes and putting those two together, works well. Outside of my IRA is where I feel forced to buy property. I love real estate more than any other non-mortgage investment.

My favorite investment is mortgage notes. Number two would be real estate but real estate comes with tenants, toilets, hassle, and transaction costs. I feel compelled to own real estate because it functions as a powerful hedge against inflation and a giant tax shelter. That is valuable to me because my tax bracket is high.

Real estate is an incredibly tax-efficient asset, while mortgage notes are tax-inefficient. Share on X

Outside of investing in notes on your self-directed IRA, what are you investing in now actively for that tax shelter you are talking about outside your IRA? Are you doing syndications or something else?

I have been a syndicator where I have been the general partner and a limited partner writing checks. I don’t usually find that the syndications give people the tax advantages that they think they do even when invested in real estate. It’s primarily because there’s not usually a capacity to 1031 exchange when the syndication wraps up. You are getting capital gains out the backside. If you were directly invested in that same real estate, you could 1031 exchange forward.

Things that I like, I teach a concept that the cap rate on the property must exceed the interest rate, ideally, by a minimum of 1.5%. No investor left behind. The property’s annual net operating income, so all the rent less the expenses on an annual basis, divided by the property value, some people use the purchase price. Still, I like using the property value, which is the cap rate. It’s expressed as a percentage. I’m seeing cap rates are low. They are compressed.

Maybe if you could buy a single-family home with a 5% cap rate, I would need to get an interest rate of 3.5% or lower to make that work. We can do that now. A 5% rate isn’t a desirable cap rate for an investment. It’s making that positive arbitrage spread where long-term fixed interest rates are low now, getting that spread between the bank’s money and the cap rate on the property, it still makes sense to buy in that way.

I do own some single-family rental houses. Those are particularly good because the financing is cheap and fixed for the long-term. The depreciation on a single-family rental is more favorable than commercial. You get a 27.5-year straight-line depreciation on the improvements for single-family and 39 years for a commercial property. I also own a medical office and single tenant net lease retail like a dollar store situation.

Those asset classes give me the hedge against inflation that I want, primarily the debt. The actual real property itself is an okay hedge against inflation. The natural hedge against inflation is playing both sides of the dollar-denominated debt game. What I mean by that is I can be a lender of dollar-denominated debt, and that’s my asset and someone else’s liability. At the same time, I want to be a borrower of dollar-denominated debt, which is my liability.

By marrying the liability of dollar-denominated debt with the asset of dollar-denominated debt, that gives me a pure hedge against inflation. In this way, it’s not enough for me to own real estate as an investment. I need to own real estate with a lot of debt on it. In a period of inflation, which we are in, my mortgage notes are going to be diluted. My dollar-denominated liabilities are also going to be diluted. It’s a pure hedge for me. In this way, if we have inflation, I’m okay.

If we have deflation, I’m also okay because the mortgage assets become more potent. The dollar-denominated mortgage assets that I own purchase more goods and services in a deflationary economy. It’s important to me to be lucrative in an inflationary environment and a deflationary environment. This is why real estate and mortgage lending going hand in hand is a beautiful situation, particularly, I’m being redundant but it’s the real estate ownership with debt.

I see a lot of people steer away from debt when they are real estate investors. It’s like a badge of courage where they are like, “I’m paying off my rental property as fast as I can. I’m making extra principal payments on paid cash for the property.” None of that. That’s all ego-driven psychobabble that makes you feel good that you are getting ahead in the financial game but it’s not true. That debt is an integral part, the real estate debt, good debt. There is bad debt for sure.

SCF 19 | Passive Income Cash Flow

Passive Income Cash Flow: The depreciation on real estate and mortgage paper is not inflation-friendly assets. These assets are dollar-denominated into a currency. Then when it devalues, the borrower will pay off their debts with cheaper money.


It’s that positive arbitrage debt where your cap rate exceeds your interest rate. How much would you want to borrow if you could borrow money at 3% and invest at 5%? All of it. Borrow at 3% and invest at 2%. How much do you want to borrow? None. You don’t want to borrow at a higher yield than you can invest at. Anyway, that positive is, in my opinion, an essential part of real estate investing to the place where that’s all it is.

When people are like, “Let’s talk about the fundamentals of real estate. What’s the real estate doing? Is it got green or blue paint? How many bedrooms?” I’m like, “Stop, none of that. It doesn’t matter.” What’s the cap rate? What’s the interest rate? How high of an LPV can I get on this positive arbitrage situation? That’s number one for me.

Number two is the simplicity of management. How simple is this arbitrage formula to manage? I like the economy of scale. Everybody should have their minimum economies of scale. Some people focus on doors like, “I’ve got this many doors.” In theory, if I could have one door, that would be perfect. How simple is that? I need to have a minimum deal size that makes sense to me, which tends to skew towards commercial because of the minimum deal size.

When you are starting, your minimum deal size is going to be small. As one’s portfolio grows and your sophistication grows, your deal size should get bigger. It’s arbitrary but it’s a point of teaching. What if you were only allowed twenty assets of any size? You are only allowed twenty-piece moving parts in your real estate portfolio. Any more than that, you become a slave to the logistics in your portfolio.

As your net worth and experience grow, your deal size also grows. It’s baked into the game of Monopoly. It’s brilliant. After you get the four greenhouses, you don’t add on a hotel. You throw the four greenhouses back in the box, and you replace them with a red hotel. Whoever built the game, I imagine that they knew that lesson.

I’m amazed at how you are a master jumping in things and figuring things out. I know many folks who are reading think they need to know everything about everything to pull the trigger on something. When you started, it was before the time podcasts were a thing, where people were learning a lot about real estate investing. How did you learn along the way? You did so many different things in real estate. How did you have the confidence to pull the trigger on something? Podcasts were around but who do you surround yourself with? What did you read?

It’s two parallel questions, confidence as well as education path. Education path was late-night infomercials on TV like, “You can buy a property with no money down. Buy these cassette tapes.” Cassette tapes through late-night TV are how I’ve got started. It was a little blurry. I didn’t know it was blurry like the stuff they were doing with no money down financing. I didn’t know enough to know at the time that the stuff that they were teaching was a little fuzzy.

You pick whatever mentors that come your way and refine your strategy and say, “Maybe I need a more elevated mentor here. I’m my own mentor here.” It’s the school of doing. In a way, podcasts and YouTube are an excellent service for expanding knowledge but readers, check your heart on this. The only true learning comes from personal experience of doing. We can talk about doing the high jump all we want, and you could listen to every podcast in the world about doing the high jump but you are not learning until you get out there and start running. Try to jump over that bar.

Syndications don't give people the tax advantages they think they do even when they are invested in real estate. Share on X

You need both. Podcasts are awesome. I didn’t have the benefit of podcasts. Candidly, I don’t listen to that many podcasts now but it’s because I’m doing calls with investors in the field for hours every day. I’m practicing my craft with fresh minds that are some of the best in the industry daily. Every day, all day long, calls with Dale.

You are living the dream and still, have time for yoga. I’m curious about your team. I don’t know how big your company is or how simple it is. In your real estate team, what do you have in total? What roles do they play? I’m very curious.

I don’t want to skip over the prior question, which was like, “How do you get the confidence to do it?” When you start, you have nothing to lose. As soon as you feel like you have something to lose, you are going to lose it. It’s this attitude of fearlessness, which is different than carelessness. To approach an attitude with fear or enter into any situation with fear is not going to go. In this way, where people hold themselves back because of fear, it’s a fear of loss.

In reality, we are so perfectly held by the universe. You couldn’t possibly lose anything. The world is so abundant. Energy is so thriving that there is nothing to lose. You manifest it through your mind, that abundance, which you think that you deserve. A lot of people get into this paralysis of analysis where they keep digesting information. They think, “If I learned enough, then the fear will go away. When the fear goes away, then I will act.” That’s not true.

We are limited by what we believe. I have been interviewing folks left and right on my show. Everybody has this strong mindset, “The world is so abundant, and I feel the same way.” I love that we are talking about this. Going back to doing your own business, I’m so curious, what’s your team look like now?

Simplicity and collaboration are powerful. In this way, I have tried to build teams that were employee-based or in a way like a patriarchal way where like, “I’m the boss, and you work for me on an hourly basis. You do what I say.” The world does work that way. It didn’t work for me. I like creating collaboration where I’m not responsible for anyone’s direct supervision in this way. Everybody is coming together in a way that we all get the thing that we lack. We offer what we have in abundance and receive from the collaboration the something we are lacking.

My team is my business partner, Tamson and I, and that’s it. It’s a two-person team. We are doing $40 million a year of loans. It is mind-boggling in a way, and on the other way, it’s collaboration. What I like to do is I use the same title company over and over. They know my systems. When I called, they were like, “We know you. We know exactly how you want your file to be.” I learned from them. When they scan their documents, they scan them in the same order every time.

I learned from their system. I didn’t have to make them do it my way. I learned the way that they did it. After I understand how they did it, it’s efficient for me to adopt their best practice. We work with a loan servicing company, August REI. They are fantastic to work with. I learned their systems. I don’t have to be in a vertically integrated part of the business. I want to know my value proposition and how I do that in the most efficient way possible.

My value proposition is creating a marketplace for buyers and sellers of paper. There are people that create paper and consume paper as an investor. I’m the grocery store for that transaction to take place. By being in that grocery store, I’ve got to stock my shelves and buy the paper. I buy them from three different categories. One is home builders who are building stuff. They are a great reproducible source of inventory. I can work with one builder. Every time they build a home, they borrow money from me. In that way, one relationship could be worth $2 million to $5 million of loans per year off of one primary point of contact.

SCF 19 | Passive Income Cash Flow

Passive Income Cash Flow: A lot of people steer away from debt when they’re real estate investors. It’s like a badge of courage showing that they pay their rental property as fast as they can. That’s not true. Debt is integral to real estate.


The other is rehabbers. I picked a couple of markets that I wanted to work in Texas specifically. I identified rehabbers that I wanted to work with. I’ve got five rehabbers that send me a bunch of deals. If each rehabber is doing 2 deals a month and I’ve got 5 rehabbers, that’s 10 deals a month or 120 deals a year, off of 5 points of contact. That allows us to be efficient. When I work with that rehabber, I’m like, “Here’s our model and what we do.” It’s efficient in that way. It’s also outsourcing and working with different companies.

I didn’t realize you kept it that simple. I have some final questions for you. What are you excited about in your business now?

I’m excited to understand what I’m doing once I have removed the distraction of money. When I come to work, I meditate like, “Am I doing this for the money?” The answer is no. I don’t need the money. If I made more money, I couldn’t spend it. I spend as much as I want to spend. I spend from passive income. When I sit down at my computer, I get to say like, “What am I doing here now? Who am I helping? How do I serve the individuals and the universe in the best way possible?” I sometimes will see the nonprofits like, “Come hang up posters. Drive a vehicle. Come wash our thing.” I’m like, “I could do that,” or I could sit at my desk for an hour and make an insane amount of money and then write a check.

In this way, I can serve nonprofits greater by doing the unique, highly efficient business model that I have curated. When I sit down to a transaction, it’s like a meditation on open-heartedness. A lot of times in the past, I have looked at a non-paying borrower and been frustrated like, “This borrower is not paying me and not answering the phone. What’s wrong with the world where people aren’t doing what they say they are going to do?” None of that.

I opened up my delinquency report and like, “Who’s not paying?” I don’t know these people. I have never talked to these people, have seen their homes or had a conversation with them. There are many multiple degrees of separation between myself as an investor and the person in the home. They are divine beings. They are humans with lives and stories. They aren’t a commodity to me. I can sit with this person in prayer and like, “They must be having a hard day.” I know what it’s like.

I remember when I couldn’t pay all my bills. This person is there now. I hold them with empathy, and they’ve got to pay. It isn’t a kindness to say, “You can’t stay in this home that you can’t afford.” It is not kindness to anyone. I can show empathy in the whole positive vibration for them and invite them to leave the home they can’t afford. These can’t co-exist.

In this way, I’m excited because it’s a meditative practice for me. What do I bring to this intersection with the economy? What do I bring to this intersection with the people I do business with when I remove money as the motivation? In this way, every interaction can be a spiritual practice of giving and receiving energy. That’s what money is. It’s a symbol, a token placeholder for the giving and receiving of energy.

When I get frustrated about the money, I know I have blocked the flow of energy. It’s up to me. If someone isn’t paying me, it’s probably because I blocked that giving and receiving somewhere energetically. It’s up to me to open that giving and receiving again, and maybe the thing that I give to this family that’s not paying is an opportunity to start again in a new home.

Offer the thing that you have in abundance and receive from collaboration what you're lacking. Share on X

It isn’t like giving and receiving, and empathy doesn’t mean rolling over and enabling someone not to follow through on their legal contracts. That’s not true giving and receiving. Evicting a tenant and giving them a shopping cart of food on the way out, I was like, “Sorry, this is the day that you are going. The sheriff is here. Here’s a gift bag for you. Peace, love, and blessings and also get the heck out.” It’s both.

What I’m most excited about now is doing all of the daily activities that I have done for several years in real estate but doing it in a new way where it looks like the same thing as I have always done, which is real estate transactions. It isn’t a real estate transaction anymore. It’s like a yogic practice of giving and receiving energy with everybody that I’m doing commerce with. Maybe this person who gets evicted, it’s like, “I have never been evicted so kindly in my life.” They take that as a positive experience.

You have a Zen approach to real estate investing, and I’m digging it. I like to ask this question to all my guests. You can answer that however you want. What does success mean to you now?

I can answer that in a bunch of different octaves. It’s the same answer but in different octaves. One octave success to me means an agency, where every single day I can live in the intention that I wake up and I’m doing exactly the thing that I want to do because I made the deliberate choice to do that. That feels like success to me. When I was working for someone else, I didn’t feel that agency at the micro-level.

When I was teaching, I taught the class that the school told me to teach. I’ve got to use the toilet when the school told me I could use the bathroom. I taught the students that the school told me I needed to teach. There were not a lot of agencies in that. Now, I go to bed when I’m tired, wake up when I’m done sleeping, work as many hours as I want to work, and help as many people as I want to help.

That freedom of agency feels like success to me. The other part of the success to me is the energetic flow that comes from wholeheartedness and integrity. Integrity more than like, “I’m doing this thing because if I don’t, I’m going to get in trouble.” That’s not full integrity. That’s like, “I’m doing the right thing because that’s the law.” Maybe that’s one level of integrity but the next level of integrity is considered like, “Is this a complete energetic action?”

When I’m participating in giving and receiving with this borrower and this investor, is this moving the universe in a higher vibration or not? More than wealth but it’s the ability to move large amounts of money. The concentration of money energy that I have is unprecedented in the history of humanity. I’m not a billionaire by any means. Some countries have a GDP right around $40 billion or at least cities.

$40 million is greater than the annual budget of the city that I live in. These are a lot of energy that I can make decisions over. Am I making those decisions responsibly? Even participating in the act of lending, sometimes I do a meditation on like, “Is this even an industry? Is this ethical participation?” At some level, I can find that it’s not.

This is land that was stolen by one government from another government. Did any government have the right to restrict this use of land? I’m financing the buying and selling of stolen property from native people. I’m like, “This is all BS. I don’t want to participate in that.” I also look at this as where we are now. Where are we now? A lot of my business is focused on creating affordable housing. It’s working on the financing of first-generation immigrants to America.

SCF 19 | Passive Income Cash Flow

Passive Income Cash Flow: Find your value proposition. It can be creating a marketplace for buyers and sellers of paper. There are people that create and consume paper. So you can be “the grocery store” for that transaction to take place.


There’s so much discrimination in America, particularly racial discrimination. Immigrant families go to the bank, and they say, “I’m from a Central American country. I like to get a loan to buy a home here in America.” The bank says, “We are happy to finance anyone of any ethnicity as long as you are American but if you are not American, there’s no lending for you here. Welcome to America but if you are not an American, don’t think you can buy property here.”

If I can participate in a private banking system that creates homeownership opportunities for immigrants and that banking system doesn’t exist otherwise, that feels good. Maybe I can’t control the whole system. I’ve got to do my part. Perhaps we could live in kumbaya and like, “Let’s throw out money and not have money and all love.” I’m like, “That’s not happening now,” but what is happening now? What can I do that is my tiny piece that helps other people and allows me to sustain the integrity and freedom I want?

You are coming from a place of contribution, and it shows. The last two questions, any final words from my audience, and how can someone get ahold of you?

You can get ahold of me through my website, My email is I’ve got some free eBooks, a bunch of free websites, and podcasts, including this episode that we will be posting on my site. All the education on my site is free. I don’t sell any education. I do transactions with people like real estate investor-type transactions. That’s a good way to get ahold of me.

Final thoughts, for people working on creating passive income, I would start by checking in on what this passive income will bring you that you don’t already have? A lot of people, if they do a self-values assessment of what’s important to them, what is it that they need, if they are approaching passive income from a pure mindset of helping other people from, “How do I create value for others? How do I create service to the world? How do I use my creativity to manifest something that didn’t previously exist in the universe?”

Those are beautiful things with the giving and receiving of the energy. If you give the energy and open your heart to receiving the energy back, that’s the passive income. It’s not only the giving of the service to the people in the universe but then it’s truly sitting open-heartedly and letting the universe give to you. A lot of people focus on the giving without allowing the receiving end to happen or they are giving with a motivation of purchasing, which is like, “I am going to do something for you on the express condition that you do something for me.”

This is baked into the real estate transaction situation in a certain octave that must exist. When you are approaching the energy of passive investing, like, “I am giving and also open to and removing any obstacles to receiving.” In that way, the deals come. You open your mind and your heart to receiving. The phone rings. It’s like, “There’s this deal you’ve got to do.” It takes $52 to do it. I look at my pocket, and I’ve got $53 and I’m like, “I’m in.”

Keep opening yourself to love and seeing where the fear is blocking you from receiving. If you don’t have all the passive income you want, it’s probably because you are pushing it away. You are probably pushing it away in fear, which is different than saying, “Sit on your butt, watch TV and eat bonbons and the money will show up.” That’s not what I’m saying at all.

Put yourself in the flow, be open to commerce, educate yourself in commerce, open your heart, and give and receive. Sometimes you wind up giving, and there’s no way that specific person or circumstances could repay you, and that’s okay. Sometimes money is going to show up. The compensation on this deal was not commensurate with my work. I’ve got paid way too much for the amount of work that I did. That’s also okay.

Those are wise words. Thank you for all your advice. That’s all the time we have. Thank you, David, for joining me on this episode. It has been a pleasure to catch up with you. It has been a while. You are inspiring, genuine, and you have touched many lives, including my own, with all the education you provide. I appreciate you and all that you do. To my readers, thank you for checking out this episode. Remember to leave a review on iTunes as it helps me attract even more great guests like David. Until next time, live life abundantly.


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About David Campbell

SCF 19 | Passive Income Cash FlowAs a real estate developer, investor, syndicator, and broker, David Campbell has been a principal or key advisor to over $800 million of real estate transactions including apartments, office, retail, hospitality, winery, condo-conversion, and production home building.

As a real estate syndicator, David Campbell has raised and/or managed over $30M of private equity invested into real estate development projects.

David has served on the advisory board for numerous companies and government agencies. David served as the elected treasurer for the Central Business District Property Based Improvement District – a taxing authority for the City of Vallejo (CA). Current and past consulting clients include real estate development companies and hedge funds with projects in excess of ten billion dollars, manufacturing companies with production and distribution facilities in United States and Mexico, Silicon Valley software companies, and a prominent Napa Valley winery.

David obtained a real estate brokerage license in 2005 and is a former member of the National Association of Realtors. David is currently the principal officer of Fourth Dimension Real Estate, Inc.; an asset management and private equity firm that assists private and institutional investors place capital into high quality real estate acquisitions and development projects.

David Campbell has been interviewed and featured in numerous publications including the San Francisco Chronicle. David is a frequent a keynote speaker at real estate investing clubs and investment seminars in California and Texas. Mr. Campbell is in high demand as a guest speaker at numerous investor clubs, radios shows, and universities.

David is formerly a guest lecturer and/or adjunct member of the teaching faculty at California State University Fullerton, Santa Ana College, and Azusa Pacific University.

David has extensive experience creating private placement syndications and investment partnerships.