My Life & 1,000 Houses
Failing Forward to Financial Freedom
By Mitch Stephen
Smashwords Edition Copyright © 2011 by Mitch Stephen
All rights reserved as permitted under the U.S. Copyright Act of 1976, no part of this publication may be reproduced, distributed, or transmitted in any form or by any means, or stored in a database or retrieval system, without the prior permission of the publisher.
Lone Horse Publishing—BMI P.O. Box 171174, San Antonio, Texas 78217
210-669-7183
Dedicated to Tommi Stephen…
Who has changed more for me than anyone I know.
Thank you for letting Me chase my dreams.
Read What Others say about My Life & 1,000 Houses By Mitch Stephen
Mitch Stephen presents something unique—a decisive strategy that incorporates integrity and compassion into a determination to succeed.
Here is an insider’s look at the highs and lows of becoming one of the most respected real estate investors in Texas. Every investment association should recommend My Life & 1,000 Houses to its Members.
—Tom Hennigan, Founder, National Real Estate Investor’s Association
There’s no shortage of books on building wealth from real estate.
Hundreds of textbook-type offerings present all the business basics you could ever need, and plenty of how-to advice to go with them.
This is not that book.
Mitch Stephen delivers a unique and practical guide to real estate success, one that examines the bigger picture. My Life & 1,000 Houses describes Mitch’s personal journey as a real estate entrepreneur, from his early struggles to his phenomenal success—success he achieved just one house at a time.
More than 1000 houses later, Mitch delivers what few real estate books do: the personal insights of an entrepreneur who not only knows what to do but does it. Plus, he goes beyond the boundaries of business, revealing how his experiences affected his personal life.
You’ll gain a rare insight into the challenges, setbacks, triumphs, and unexpected lessons that come from one man’s venture into the entrepreneurial life. More importantly, you’ll be inspired.
—Eddie Speed, Founder of NoteSchool® and Author of Streetwise Seller Financing
The San Antonio Real Estate Investors Association has dedicated its offices in Mitch Stephen’s name. Although he never served as president, on the board, nor on a committee, Mitch has made a tremendous difference in the success of others by simply showing up and giving freely of his expertise. My Life & 1,000 Houses captures the essence of this man’s business acumen and the personal history on which it’s based. His book is as fascinating as it is entertaining.
It speaks to you on levels far deeper than the issues of money, and demonstrates how success is much more than financial wealth.
We’ll always have a copy of this invaluable book at “The Mitch Stephen Investment Center.”
—Orlando Rodriguez, President of the San Antonio Investor’s Association, San Antonio, TX
If only Mitch had written this book 5 years ago when I got started in real estate! I’ve read about a hundred books on real estate and attended dozens of seminars on the subject. But if I had to pick the one factor that helped Me the most in moving from homelessness to financial freedom, it would be this book. Mitch’s straight-forward, tell-it-how-it-is style blends the perfect amount of humor with serious and insightful content.
—Eli Call, Financially Independent Real Estate Investor, San Diego, CA
Mitch is a walking encyclopedia of information, and it shows in this long-overdue book. Rarely do you meet someone like this who has the charisma, smarts, and initiative to take action in the direction of their passion. After reading this book, I find it much easier to accept life’s challenges, take action, and push forward to success!
—Joseph Ponce, Retired Army Officer/Real Estate Investor, Ft. Bragg, NC
Bookstore shelves are packed with publications claiming to reveal the easy route to wealth. However, few address the struggles encountered and the life lessons learned during the pursuit of success.
My Life & 1,000 Houses is that rare offering. With little more than passionate desire and initiative, Mitch moved from abject poverty to extraordinary riches. He takes you along on his amazing quest for financial freedom through real estate, without sparing the rich texture of setbacks and disappointments he experienced along the way. His tale of blood, sweat, tears and laughter is truly inspirational.
—Michael Walloch, Co-Founder of www.IBuyHouses.com, Dallas, TX
My Life & 1,000 Houses is refreshingly different. I found myself enlightened and entertained at the same time. This book is a real achievement. It’s a keeper!
—Bill Bridges Jr., Regional Director, The Ritz-Carlton Club & Residences
When it comes to real estate, Mitch Stephen is the real deal. With single-minded purpose, hard work, and a devotion to his investors, Mitch has succeeded in numerous facets of real estate. His inspiring book delivers several revelations about life in this business. You’ll laugh and cry and turn the last page with a smile.
—Bill Crawford, Author of 18 books including, Stevie Ray Vaughan: Caught in the Cross-fire and All American: The Rise and Fall of Jim Thorpe. Austin, TX
My Life & 1,000 Houses is not another get-rich-quick book. Rather, it’s an inspirational story about thinking outside of the box, looking towards the future, establishing the right relationships, standing by your word, and continuing to challenge yourself. I saw myself in this book, and contemplated its content much more than I had expected.
This book is a smooth, gentle read that keeps you turning page after page. I read it in just two days because I couldn’t put it down.
—Tommi L. Leonard, Vice President, Stillwater National Bank, San Antonio, TX
My Life & 1,000 Houses is a must read for the serious or aspiring real estate investor. If Jack Canfield and Mark Victor Hansen of the Chicken Soup for the Soul® series ever decide to offer a book about real estate investment, this is the story they should use. I found myself laughing out loud on an airplane while reading it!
—Mike Ochsner, Founder of the www.IBuyHouses.com Marketing System, Salt Lake City, UT
I’ve just finished reading My Life & 1,000 Houses by Mitch Stephen.
What a trip! I laughed, I cried, and I felt like I had been there myself.
Mitch is a great storyteller. His descriptions of the hard times he encountered and how he got through them were a great education for me. I also reveled in the good times he experienced. With this book, you’re in for a real treat.
—Margaret Childress, Customer Support Assistant, One Advocate Group, San Antonio, TX
Table of Contents
Chapter 1. The All-American Family
Chapter 2. California, Here I come… almost
Chapter 5. Adversity University
Chapter 6. Stay Out of the Ruts
Chapter 7. Real Estate Makes Money?
Chapter 8. There’s a New Landlord in Town
Chapter 9. Carwash at Spriggsdale & Commerce
Chapter 10. The Power of the Written Word
Chapter 11. The Power of Prayer
Chapter 12. Feather in the Wind
Chapter 13. Escaping the Debt Trap
Chapter 14. The Difference between Ham & Eggs
Chapter 15. How Do You Eat an Elephant?
Chapter 16. You Can’t Plan Everything
Chapter 19. The Moat Theory: Keep Something Sacred
Chapter 20. The Moat Theory: Freedom to Fail
Chapter 21. On the Other Side of the Clock
Chapter 22. Money Can’t Change Everything
Chapter 23. Breakfast With A Stranger
Chapter 25. Hit In the Head with the Note Buying Bat
Chapter 30. Credit Card Counseling
Chapter 31. Meeting Sam Hombre
Chapter 33. The Grand Slam of Real Estate Investments
Chapter 37. The Real Cost of Money
Chapter 39. Private Money (Part I)
Chapter 40. Private Money (II)
Chapter 42. Needle In A Hay Stack
Chapter 46. Keep On Keepin’ On
“Forgiven” (1 Cross, 3 Nails FORGIVEN)
Chapter 49. Jumping In With Both Feet
Chapter 50. Internet Marketing for Real Estate
Chapter 51. The 25th Annual Tejano Music Awards
Chapter 53. More Stories from My Life & 1,000 Houses
Story 3. So What Can a Dollar Buy?
Story 4. Gambling or Investing?
Story 5. Cheap Lots—Lots of Income
Story 6. Off the Coast of Australia
Story 8. Do What Your Pie Hole Sez
Story 9. Captain Stephen’s Maiden Voyage Farewell
Story 10. Where’s Your Hammer?
Story 12. Cellular Phone Crisis
Story 13. Beating the Phone Bill
Story 15. Conning the Cons (Part I)
Story 16. Conning the Cons (Part II)
Story 18. House On Hausman Road
“The master in the art of living makes little distinction between his work and his play, his labor and his leisure, his mind and his body, his information and his recreation, his love and his religion. He hardly knows which is which. He simply pursues his vision of excellence at whatever he does, leaving others to decide whether he is working or playing. To him he is always doing both.”
—James Michener
The learning is in the living My name is Mitchell Stephen. I am honored that you are reading this introduction. As you might imagine, I did not invent real estate, nor did I pioneer any of the techniques used to create wealth via real estate. While I may have a larger understanding of real estate than the average person, I’ve never considered myself to be a sophisticated person. I don’t consider myself to be a genius or even above average in the mental department. I am sure that some of the movers and shakers out there would assess me as a slow learner, and that’s ok. I’ll say it first. My story is proof that I have to get hit in the head with a concept before I actually learn it. I don’t believe I’m that much different from most people in that we don’t learn when people tell us things. For us, the learning is in the living.
My light bulb didn’t go off until I was in my mid 30’s. Much of this book is about what it took for me to get my entrepreneurial skin thick enough to just survive. Long before I could find a deal in real estate, I had to find myself. It took a lot of persistence to find my place in the world. This is the point of the pages that follow: You don’t have to have a Harvard education to accomplish or even exceed your dreams.
You are, however, going to have to work your butt off, just like the Harvard graduate. There is no easy money for anyone. Period!
The late night, get-rich-quick infomercials are not driving that point home nearly as much as they are waving copies of big checks in your face. This would be a good time to ask for a refund if I’ve ruined your concept of real estate already. If that’s the case, may I suggest you take the money and buy some lottery tickets, good luck! The rest of you will get my heart and soul. I can’t tell you how anyone else did it, but I can tell you how I did it, for better or for worse. I am sure that at some juncture you’ll begin to figure out that my particular journey was NOT the shortest path between two points. Perhaps you can shorten your journey by reading my story.
The intricacies of a deal can go on forever, and there’s always more than one way to do things. There are plenty of gurus out there who will be happy to teach you every single one of those ways. Don’t trip over the pennies on your way to the dollars. This is my story.
The All American Family
Sometimes you don’t know how good you have it.
It’s true: If you’re born in Eden, you don’t know you’re blessed.
My childhood was picture perfect and I thought the world simply ran like that. I thought that everyone’s mother was beautiful and caring and everyone’s father was handsome and hardworking. My younger brother, Kleat, and I were truly blessed. We had a father who never shunned one iota of his responsibility to provide for and lead his family, and we had a mother who stayed at home and nurtured us with the conscious and deliberate agenda to raise two strong, caring, and loving sons. Looking back I can’t think of one thing we ever wanted for or that I’d change. Together, my parents provided a home and family right out of a 60’s sit com, Father Knows Best or Leave It to Beaver. We were a family right out of Mayberry, but even better, we had air conditioning!
My father, Rod Stephen, was born in Eastland, Texas, and grew up ‘round about the depression. He volunteered for the Marines and completed his commitment. By the time my brother and I were born, Dad was a coach for the Longview Lobos High School. My mother, Margaret Rita Turk (Rita), was raised in El Paso when she wasn’t on the Indian reservation in New Mexico. Her grandmother (my great grandmother) was full blooded Mescalero Apache. We could all be stalking deer on the great hunting lands, but Great Grandma told the white man to stick their papers where the sun don’t shine…and who could blame her? Mom would achieve education on her own but there is no doubt that her very special heart and soul was an extra special gift from God. In Okinawa, Rod accidentally on purpose fell in the pool next to Rita, and a few years later my brother and I were walking the planet.
My brother Kleat and I were born in Longview, Texas, and we had a very close relationship. We climbed trees, built forts, hunted and fished, played all kinds of games, and excelled in athletics together.
Later, I’d wonder, did I ever have a girlfriend he didn’t kiss?
Generally speaking, we were two peas in a pod.
One time when we were in elementary school, I remember Kleat coming home all beat up. I asked him who did it and he told me that one of the twins down the street did it, but he didn’t know which one it was. The twins were my age and bigger than most. I headed out the door and found the identicals laughing about the event on the street corner. When I asked which one of them beat up my brother, they refused to tell me. I couldn’t tell them apart either. Heck, no one could tell them apart. So I beat them both up! After that I figured I needed to teach Kleat how to fight. I’m not so sure that was a good move. As brothers do, I’d have to fight him more than most. But we always got past it, as brothers do.
My family likes to hunt. My brother and I have hunted since we were very young. Of course, one of the primary concerns in the early years was that we not get hurt or hurt anyone else with our firearms.
My father taught us verbally everything he knew how to about gun safety. He was constantly watching how we handled our guns, where the barrel was inadvertently pointed, how we loaded and unloaded our guns, whether the safety was on or off—always, always, always counseling us.
I’m the oldest and of course the first to start shooting. Carrying a full-fledged firearm was new for me. The responsibility of educating a young son about firearms and safety was new for Dad. He wasn’t sure if I was getting it. Yes, I was hearing him, but did I really understand the importance and the huge responsibility of handling a rifle?
He wasn’t sure, and he couldn’t rest until he knew without a doubt that I understood the full weight of the situation.
One day he asked me if I wanted to go to the shooting range.
He said he wanted me to help him sight in his old 30-30 rifle. I was proud that he fancied me as a good shot, so of course, I said, “Yes.”
We hopped into the truck and off we went.
When we got to the range we set everything out on one of the shooting tables. Dad told me to take the rifle out of the case. I knew what he was waiting for. He was waiting for me to check immediately to see if the rifle was loaded or empty. It was the first rule of guns.
“Never touch a gun without checking to see if it is loaded.” You touch it, you check it. The last thing I ever wanted to ask my father was, “Is this gun loaded?” That question would get you lit up. You don’t ask—YOU CHECK THE WEAPON YOURSELF! Dad watched me check the rifle’s chamber for shells. I cocked the magazine open and gazed at the insides. He leaned in to look at the same time. He saw it was unloaded, same as I did, but still he asked me, “Is it safe?”
I answered, “Yes Sir.” He made his point with his words and with an intent look directly into my eyes.
After we grabbed some sandbags, he instructed me to take a seat at the table. We made a few adjustments with bags while I was in the shooting position. Dad asked, “How’s it feel?”
“Pretty good,” I said. I had the butt of the rifle pulled in tight to my shoulder with my cheek down on the stock. With one eye shut, I could see that the barrel set nicely in line with the target one hundred yards ahead of us. I’d never shot his gun before. It was one of those sacred moments. Dad was about to let me shoot his 30-30 rifle.
As a marksman, I’d already achieved excellence with my Crossman “pump” BB gun. Carrying a gun or shooting wasn’t new to me, but the big rifle was a bit intimidating.
Dad: Think you can put one in the bull’s eye from here son?
Me: I reckon I can.
Dad: This trigger has a long draw on it. It takes some getting use to. I’m not a real fan of dry firing a gun, but why don’t you try it once or twice and get a feel for it.
Me: OK.
I closed the magazine and got down on the target. I took a deep breath and pulled the trigger slow at first but, then, I yanked it. “CLICK.” The gun dry fired. I knew, without a doubt, I would’ve missed if this had been the real thing.
Dad: You jerked it didn’t you?
Me: Yes Sir, I sure did. That trigger does take a long time to go off.
Dad: Try it again. This time you’ll know more what to expect.
I cocked the empty gun again and started to bear down on the target.
Dad: Take your breath and pull so slow you don’t even know when it’s going to go off.
CLICK. The hammer flew forward striking to the firing pin.
Dad: That was perfect! Cool as a cumber! You’d have leveled that deer.
Me: Yes Sir, I would’ve that time but sure is a long pull.
Dad: Awe, you’ll get used to it in a few more times. Hey, let’s take a break and go get us a cold soda-pop. I saw a machine around front. Here’s some change. Go get us both one will you?
I disappeared around the front of the little house/office. When I got back, we sipped our sodas and talked about the upcoming deer season. It was starting to get hot.
Dad: Hey, what do you say we try this one more time before we start using expensive ammo.
Me: OK, but I hate to shoot your gun dry like that. Sure it’s alright?
Dad: Yea, it’ll be alright. I got it ready for you too. One more time won’t hurt it.
I got into position while Dad was coaching me to take my time.
“Nice and easy…take a breath and then…nice and slow…squeeze the trigger.”
BANG! The gun went off! It roared like all the thunder I have ever heard in my life, all happening at once! The adrenaline shot through my body, fear–shock–panic. I jumped up off the gun and looked at my father with eyes that must have been big as saucers…more fear and panic, and then embarrassment. My heart had all but leapt out of my chest. My ears were ringing. I was stone cold, petrified. And stunned! My father grabbed me with one hand and the rifle with the other. Holding the rifle way away from his body with one arm, he clinched the front of my shirt at the collar and pulled me to him with his other arm. His face was within inches of mine. He had big tears in his eyes and he gritted his teeth. A single drop was forced from the corner when he closed his eyes and said, “Son, the gun is always loaded. No matter what you think, no matter what anyone tells you, no matter what you might suspect, the gun is always loaded, son. The last three words were barley audible but whispered directly into my ear I heard them, “It’s always–loaded!”
My father had slipped a shell into the rifle when I went for the sodas. He did it to make an impression on me he feared his words were not making. I just thought I understood that my rifle could go off and kill somebody. I got a new understanding that day. All the coaching, all the fireside chats at camp, all the talking in the world would not, could not, accomplish what my Dad did with one very carefully placed 30-30 shell that day.
A few days later, I asked him why he’d gotten choked up that day on the rifle range when the gun went off. He welled up somewhat again, “Because I love you. I love you so much and I don’t want the potential of that gun to ruin your life. If your gun ever kills you or anyone else I will never forgive myself. I want you to enjoy the outdoors, to experience the wilderness and the thrill and cunning of the hunt. But it comes with a risk. That gun is dangerous. It’ll kill you dead as a door nail in a heartbeat. It can steal all of those good times away in the flash of a muzzle.”
Dad continued, “You see, when I was a kid, my gun went off. Unfortunately it was not orchestrated like yours was. I could have killed someone—anyone—who would have been standing in the path of my bullet. I got lucky and no one got hurt, but I have never forgotten that moment when my gun went off unexpectedly. It made an impression that has lasted all my life. I think, no, I know, it takes an unexpected discharge before that gun will ever get all the respect you can give it. When it happens you’re almost sick with the realization of what could have happened. I wanted you to get that experience without having to take the chance I had to take to get it. I was overcome because I could tell by the look on your face when that gun went off that you had gotten that experience. I was relieved.”
As a student of life, I’ve learned almost everything meaningful in this fashion. It has to happen to me in real time for me to get the lesson once and for all. Yes, for many of us, learning is in the living.
My high school days were picture perfect; all district this, most popular that, played drums in the local rock-n-roll band, and had a dang pretty girl friend. I drove a 1979 midnight blue Trans AM complete with T-Tops and an oyster white, leather interior, straight off the show room floor (thanks Mom and Dad!). I thought I was the coolest thing in town, but it was really just a very cool time. I’ll never be able to thank my parents enough for all they gave me and did for me. It simply cannot be done.
I had average grades in school and excelled in football. I’ve often wondered what I’d be like today if it hadn’t been for athletics in school. It’s been said that athletics can build a strong inner fortitude.
I’m certain that it did in my case. At 125 pounds, I was probably one of the smallest 4A starters in Texas. I started my first varsity football game as a sophomore at the running back position in 1976. At the time, in 4A high school, that was a big deal. I really had no business starting on a 4A high school team but, lucky for me, our team didn’t have anyone better. I was never the fastest man on the field, but with a lot of help I managed to gain my fair share of yards. The main thing I had going for me was that my mind was right. It was not a conscious decision to prevail over my lack of size. Simply put, I was never told that I couldn’t, so I did. After the graduation ceremony, we all went to the last “Class of ‘79 Keg Party.” When I woke up the next morning the bleachers were empty.
It was only natural for me to try to find a new stadium. I spent the next year working out and training. When I walked on my first college football field in San Angelo, Texas, five years after my high school debut, I weighed a meager 165 pounds soaking wet. The front line was averaging over 300 pounds per man.
During some testing for quickness and speed, I found myself paired up beside a lineman to run the forty-yard dash. He weighed in at about 325 pounds. I thought to myself, “This guy isn’t going to push me to my best time.” Well, that was wrong. I barely managed to outrun the big man by 1/100th of a second. I wasn’t that slow. The big man was just that fast! I watched as the other running backs got tested. The Astroturf all but rolled up behind the speed demons as they crossed the finish line. With every official time they recorded, my heart sank a little further. There was no way I could compete at such levels. In all my eighteen years, quitting football had never been an option, not even a remote thought, but the handwriting was on the wall. I was going to get cut from a football team.
My dreams of football were dashed. It was a very confusing time, and I lingered for awhile through 1980 and 1981. Eventually, I did what any red-blooded American boy would do. I packed up my Trans AM, took the t-tops off, cranked up Boston on the cassette stereo, and headed for California. Why, you might ask? Well, red-blooded American boys don’t need a reason to go to California. They just go.
Stephen Family: Kleat, Rita, Rod, Mitch (left to right)
California, Here I Come…Almost
There’s a lot to be said for a change of scenery.
Somewhere between Las Vegas, Nevada, and Bishop, California, I got side tracked it the tiny town of Tonopah, Nevada (probably because I ran out of money in Vegas). I ended up getting a construction job building a state-of-the-art molybdenum mining plant. To get to the job site, I had to go about three or four miles west down the main street of Tonopah, take a right on a newly paved two-lane road, and drive thirty miles down that road with nothing but tumbleweeds and sand for as far as the eye could see. When I finally reached that little black spec on the horizon, I had arrived.
On the right side of the road there was a mining facility and, on the left, there was a KOA Camp with a convenience store. Well, it was almost like a convenience store except that it had fifty concrete shower stalls in the back. The showers were there to accommodate over 2,000 workers living in every conceivable size and shape and make of RV, fifth wheel, camper trailer, and tent you could imagine.
There were also more long-haired, leather-clad, earring-wearing, beard-growing, whisky-drinkin’, dope-smokin’, knife-wielding, tattooed men there than I’d ever seen or hope to see again. Being the red-blooded American boy I was, I decided to stay.
When I showed up to apply for a job on the first day, I got in a line to sign up for work. There were several lines with about fifteen to twenty people in each line. At the front of each line sat rough, husky men wearing hard hats, bossing everyone around and handing out paperwork and orders. I started talking to other guys in line to see what I was in for. I started with the guy in front of me in line.
Me: What’s this line for?
Stranger in front: This line’s for laborers.
Me: How much do laborers make per hour?
Stranger in front: Laborers get paid $12.00 an hour. I looked over at a biker-lookin’ guy in the line to my right.
Me: Hey man, what’s your line for?
Guy to my right: This line’s for welders, dude.
I didn’t figure I could fake being a welder so I looked over towards the line on my left hand side.
Me: Hey man…what line are you standing in?
Guy to my left: This line’s for iron workers.
Me: What do iron workers do?
Guy to my left: We screw together the metal as the building goes up Now I was absolutely sure I could screw up metal, so I was encouraged.
Me: What do iron workers make per hour?
Guy to my left: Iron workers make $15.00 an hour.
I nonchalantly drifted out of the laborers’ line and into the iron workers’ line. When it was my turn to talk to one of the leathernecks, he started asking a bunch of iron worker questions I didn’t know the answers to. Still, I did my best to muddle my way through. With every question, I got deeper and deeper into a hole. Mr. Leatherneck had had just about enough of my non-iron-working B.S. when this scrappy looking, one-eyed guy tapped him on the shoulder and said, “I’ll take him.” Old “Uno” had his head cocked down so that his good eye was looking over the top of his reading glasses and right at me.
He eyeballed me up and down, from head to toe, like I was a cow at auction or something. He never cracked a smile. Finally, he pointed towards his truck and told me to wait for him over there. So I hauled my newly appointed, iron-working butt over to my new boss’s truck.
Along the way, I waved at the guy I’d met in the Laborer line as they were handing him a broom. He shook his head and pointed his finger at me as if to say, “You son-of –a-gun! I should have done that too.”
My boss said he picked me because he’d seen me switch lines, and he liked my decision-making process. Amazing! I’d escaped detection from everyone else in the building but the guy with one eye caught it! I was more of a gopher for Cyclops than I was an iron worker, but for $15.00 an hour plus overtime, you could call me anything you wanted to—anything but laborer. We worked twelve, fifteen, sometimes eighteen hours a day. We worked hard and played hard too. Every Friday evening, the 2,000-plus construction workers stampeded the 2,000 residents of Tonopah and proceeded to burn that poor town down to the ground. It was like a scene from Kevin Costner’s movie Water World, but instead of being in the middle of the water it was in the middle of the desert—lawlessness run amuck!
I was twenty years old. The legal age in Nevada was twenty-one.
That probably kept me out of some trouble, that and the fact that two old timers had taken me under their wings. I have always been blessed in that way. The good Lord usually places me in good company.
Moose was a huge, burly man (as you might suspect by his nickname), and my boss, One-Eyed George, was lean and mean. They never looked for trouble but when it came-a-knocking, it promptly left when Moose stood up and turned his baseball cap around backwards.
It was a very rough place, and I made it a point to stick close to Moose and One-Eyed George.
During the workweek there was not much to do in camp after work but read. In that little convenience store, I purchased my first Entrepreneur Magazine. The magazine had all kinds of ideas on how to start your own business, but the one that caught my eye was an article about striping parking lots. I must have read that article a dozen times. I started to formulate a plan: Sell my drum set for $750 and purchase a striping machine. I’d exercise that plan sooner than I thought.
I still don’t know how I did it, but three months after I’d arrived in Tonopah, I was packed up and headed back to Texas, tattoo-less!
I got home and heard that Moose had fallen from high in the structure and hit his head on one of the steel I-beams on his way down.
It messed him up really bad. I thought about going to see him, but his wife said that he didn’t even know who she was and not to waste my time. Still, I regret not going. Today, I do not know where he is or how he is, but I would like to take this opportunity to thank Moose for watching over me back then. Thank you too, One-Eyed George.
This is me after a hard day’s work in Tonopah, NV
Mitchell Striping
Doing the work is just half the battle…
You have to collect your money.
Shortly before I plunged into entrepreneurship, I was fortunate enough to be able to ask a very successful builder a few questions about starting a new business. He informed me that most businesses fail in the first two years due to lack of work ethic and/or lack of money (under capitalization). He also told me that my life wouldn’t be my own for the first two years if I were going to make it work. I was about to learn exactly what he meant. To this day, I always seem to underestimate the start-up costs and the time it takes to establish a new business. (Hey, at least I’m honest about it!) No one in San Antonio would talk to me about the striping business.
I needed to know what type of machine to buy, what type of paint to use, how to bid jobs, etc. And the thought of actually painting a straight line on the pavement terrified me. What if I painted this ugly, crooked line on someone’s parking lot? Finally I called some guys in Austin, Texas, and offered to work a week for free if they would teach me a little bit about the business. I promised not to do any work in Austin in return for their consulting. They had me painting straight lines in no time. When that week was over, I returned to San Antonio and purchased my first machine from the Perry Shankle Store with the money I’d received from selling my drum set. Every now and then, I’d be asked to go to Austin and do a job. True to my word, I never did any work in Austin, even after I’d lost track of the guys I‘d made my promise to.
Business was good, but the dang construction companies took their sweet time paying me. Entrepreneur Magazine forgot to mention collection problems in their articles. I had to pick up some kind of part-time job so I could afford to buy the paint and gasoline I needed while I waited to get paid. Doing the job was one thing. Getting paid was another. The lessons were coming at me quick but I liked it like that. I was learning more per month about real life business than I could have learned in a year of college. For the first time in my life, I could actually feel myself growing intellectually.
I ended up taking a bartending course so I could get a part-time job as a bartender. I needed a job that paid me immediately so I could mitigate the time between striping pay days. Bartending seemed to fit the bill.
I got fired from my first two bartending jobs (both times on the first night). The bartending institute did a great job of teaching me the ingredients of all the drinks, but they forgot to teach us how to run a cash register. What kind of deal is that? I’m just thankful it was bartending and not flying lessons.
Me: Mitch to Tower. Do you read me? Over.
Tower: We read you loud and clear, Mitch. Over.
Me: Request permission to land on runway 3. Over.
Tower: Runway 3 is clear for landing. Over.
Me: Tower, I have one small problem. Over.
Tower: State your problem. Over.
Me: The jerks at the “Institute of Flying” forgot to teach me how to land.
Tower: Copy that. They only teach people how to fly. We’ll notify the fire department and the ambulance crew. You’re clear for landing. Over.
Nothing’s ever as easy as it looks. There’s always more than meets the eye.
After a short stint at the cash register institute, bartending was great! I was 21 years young, loving the nightlife, and making $100 to $150 per night, four nights a week. I was in the hottest bar in town, The SK Stampede. An eight-hour shift passed like a ten-minute roller coaster ride: fast and furious, with no time to look at your watch.
I’d leave the bar at 12:00 or 2:00 a.m. and go stripe parking lots while they were still empty. Before I knew it, the sun would be coming up—and that’s how I liked it. To this day, I have trouble looking at my watch when I’m working.
I bought my first property about that time. It was a one-bedroom efficiency condo that the seller financed for me. It cost $28,000 with $2,000 down. Shortly after I put my John Henry on the papers, I was a man about town. I had my own business, my own car and my own place. Not bad for a twenty-one year old I thought. Life was good!
I quickly took on a partner in the striping business. On that fateful day, I’d spent half the morning broom sweeping by hand just a fraction of a lot I intended to stripe. Then this stranger walked up from out of nowhere with a blower on his back and finished cleaning the rest of the entire parking lot in ten minutes. He showed me how to use the blower, and I showed him how to put a stripe on the ground. That was the beginning of my partnership with Jimmy Allison. Jimmy was even a few years younger than I was. He had wild, curly, red hair and freckles and, together, I suppose we looked like two outcast members of Spanky and Our Gang. Many of the construction foremen didn’t take us seriously when we’d ask to bid on their jobs but, eventually, we’d striped every parking lot in San Antonio, no joke. Jimmy and I became the best of friends and we worked like you’ve never seen two guys work in your life.
We did the regular business stuff during the day like banking, sales, collections, bidding, etc. At night we would stripe our butts off.
Mitchell Striping was pounding out the work but, just like before, the money was fast going out and slow coming in.
Once we got called into Frost Bank by then Vice President, Ken Herring. We thought we were going to get a loan or something good like that, but it turned out much different. When we got to Frost Bank we were met by none other than the FBI.
FBI: Are you fellows kiting checks?
Me & Jimmy: No.
FBI: Do you know what kiting checks means?
Me & Jimmy: No.
FBI: Kiting checks is when a person deposits money at one bank and then withdraws that money the same day and goes to another bank and deposits it in such a fashion to show the money in both banks on the same day.
Me & Jimmy: Well, sir, we’re doin’ the Hell outta that!
As I’ve mentioned, the huge companies we worked for took their sweet time paying us. First it would be thirty days, then sixty days, then ninety days. The slow pay was killing us cash flow-wise, so we started getting creative. Texas State Bank’s daily clock ticked over at 3:00 p.m. but Frost Bank’s clock didn’t click over until 4:00 p.m. So, we started making deposits at Texas State Bank before 3:00 p.m., and then we’d take the money back out at 3:30 p.m. and run the funds over to Frost Bank and deposit it before 4:00 p.m., just to float payroll.
Those badge waving men in suits scared us to death until I caught my account rep trying to contain his laughter outside the fish bowl office. When I caught the agent himself trying not to laugh I assessed that they were just giving us a little scare. I didn’t let on, but I knew we weren’t in any real trouble at that point, so I played along, letting them have their fun with us. They knew we didn’t mean any harm. In our young, naïve, business minds we thought we were being smart, creative businessmen until we could get paid. You know, if it feels wrong…it probably is.
Learning to paint a straight line on asphalt (Mitch)
Angels Among Us
Sometimes only a stranger can tell you.
Around 1982, the pace of that twenty-four hour a day business started to take its toll on me. I’d go to sleep at night and wake up two days later, with everyone pissed off at me. I started finding it increasingly difficult to make it through a day without busting into tears (when no one was looking of course). Hey, I played football. My father’s a former Marine. We don’t cry about a dang thing! I didn’t know what was happening to me. I’d quit football, and now I was crying like some baby all the time. What’s next? I stop liking girls?
When it came time to cry, which could be anytime, anywhere, and always right out of the blue, there was no holding it back. There was little warning, and within seconds, I’d break like a cheap water balloon on the windshield of an oncoming car, floodgates wide open!
As luck would have it, the bar I worked at wasn’t much different than that of the sitcom Cheers. We had regulars you could set your watch by: The kind of customers who frequented happy hour every day of the week and always arrived at the exact same time, sat in the exact same spot, and ordered the exact same drink without fail! I served this one particular customer everyday for months but never bothered to ask what he did for a living. I was always too busy promoting my own business to worry about what anyone else did for a living. (It’s a character flaw I still have, but I’m working on it.) I remember bragging to him about sleeping on the sofa for over two days straight without ever getting up to take off my clothes or to use the bathroom. No drugs. No alcohol. I just fell asleep on the sofa watching TV and didn’t wake up for forty-eight hours! Looking back, my customer started asking me questions shortly after that. I thought nothing of it at the time. I guess it was the way he asked. His questioning came off as idle conversation.
“Hey workin’ man, how long did you end up working yesterday?”
“Are you going to get some rest tonight or are you going to work straight through ‘til daylight again?”
“Hey, Mitch, I haven’t seen you for a few days. Did you fall asleep for forty-eight hours again?”
“You‘re looking a little stressed my friend. May I buy you a drink?
Is everything okay with you?”
“Mitch, how long have you been in the striping business?”
“What do you do for fun? Do you have some fun?”
“When was the last time you took a day off? Do you ever take a vacation?”
One day I was stuck behind the bar talking to this customer when suddenly the dam started breaking. I couldn’t run anywhere to hide so he caught a glimpse of me starting to crack just before I ducked down below the bar. I stayed down on my knees as if to count liquor bottles or something. Really, I was just crying. I’m sure he could hear me sobbing but at least he couldn’t see me. More importantly, I did not have to see him seeing me. I thought the attentive customer had just been keeping up with me over the months through conversations across the bar, but really he had been diagnosing my condition. I guess my unraveling was the last straw for him.
On my next shift, he arrived as usual before the rush. He placed a rather thick book on the bar in front of him. The manager of the bar approached me shortly thereafter and instructed me to go sit with my customer at an out-of-the-way table while he took over my bartending duties for a while. It was early. Business was slow. I thought it was odd but what the heck.
I sat down at the table with my customer, and he explained that he was a psychologist. For the past ten years, he had been working for the state prison system helping men with life sentences cope with their reality. He went on to explain that he admired both my entrepreneurial spirit and my work ethic, but he was beginning to worry about my health. He asked me how often I cried like the other night.
I told him, “Well, at first it was once a month, then later it was twice a month, then once a week and now (I was embarrassed to say and had looked down at the table) almost every day.” A lump grew in my throat as I spoke and I worked hard to choke it down.
He asked me to read a few pages from the book he’d brought in.
Highlighted on a page was a list of symptoms I recognized all too well. I don’t know why the revelation struck me so hard. Maybe it was the relief of finding an explanation. Whatever the reason, I could not contain myself for another second. There I sat during happy hour, tears rolling down my face, crying for all I was worth.
Now, finally, I knew what was happening to me. At twenty-two-years of age, I was having a nervous breakdown. I was trying so hard to be successful that I was wearing my poor body plumb out. My will was stronger than my flesh and bones, and even some parts of my mind (like the part that needs sleep). I was pushing so hard, apparently too hard, and for way too long. The only symptoms I had not experienced were black outs or loss of memory. Then again, for the life of me, I cannot remember that good doctor’s name. I hope I bought him a drink afterwards because I now understand that a nervous breakdown can be a lot worse than just tears. So, whoever you are, wherever you are, “Thanks, Doc.”
I still struggle with this problem today. You can only work so much. Sooner or later, if you are going to grow big or bigger, you have to leverage money or human capital or both. If you don’t have balance between work and play, things can go to Hell in a hand basket and fast! I’m not telling you I’m good at it. I simply telling you, I’ve come to know it’s true.
I took a month off. When I tried to come back, I fell into the same routine and, within a week, I was breaking down every day again. Completely drained and desperate for rest, I gave up my half of Mitchell Striping. Letting Jimmy down hurt me, and I was starting to feel like a real loser.
The next few years (1983–1985), with Jimmy at the helm and me back at the bar, Mitchell Striping grossed as much as $1.7 million a year. Shortly after that, my best friend Jimmy died. Dr. Denton Cooley, the famous heart transplant surgeon, had given Jimmy a replacement heart but for whatever reason, it just didn’t take after awhile. At the time, he was the youngest active heart transplant patient ever. They said his initial heart problems had nothing to do with the stress or the workload, but I’ve always wondered. He was a real go-getter, a great friend, and I miss him to this day. I could tell plenty of stories about Jimmy and what a genius he was despite his young age. I will tell you this: If heaven has yellow lines on their parking lots, Jimmy Allison painted them.
Written by Mitch Stephen and Billy O’Rourke
Daddy worked the railroad 30 some-odd years
On the train that was the center of our town
Never had to wonder where on
Earth he was
We’d just close our eyes and hear that whistle sound
The Railroad Commission sent the suits one day
And they tore up all the tracks
The whole town starrin’ at their golden watch
Like that train, is sometime comin’ back
CHORUS: Baby that train, it don’t stop here anymore
It’s been moved on down the line, for one reason or another
And it’s got plenty of, our memories aboard
But it won’t be comin’ back
‘Cause baby that train, it don’t stop here anymore
Jimmy was my best friend and the first to get his car
And we’d cruise the town each
Friday night I could always count on him to get me to the dance
Or around the Dairy King a thousand times
Then his mother got a letter, with a folded U.S. flag
She sent me the keys to his Fairlane Sayin’,
Jimmy would’ve really wanted that”
(REPEAT CHORUS) ‘Cause baby that train…
BRIDGE: This year the angels took my
Brother And I’ve known no greater pain
Lord meet me early at the station
‘Cause lately I’ve been missin’ far too many trains
MODIFIED CHORUS: ‘Cause baby those trains, they don’t stop here anymore
They’ve been moved on down the line, for one reason or another
They’ve got plenty of, our memories aboard
But they won’t be comin’ back…
No they won’t be comin’ back
‘Cause baby those trains, they don’t stop here …anymore
Listen: http://www.mitchstephen.com/trains.asp?music=on Sung by Kevin Hughes Copyright, 2005 Mitch Stephen, Lone Horse Publishing–BMI
Jimmy Allison poses on a newly purchased water blaster rig
Adversity University
I eventually graduated from La Calle (the Street) U.
From then on things started going down hill. I had more jobs and I tried to start more businesses than I care to count. Everything failed. Texas was in a recession, and I was getting further and further behind little by little. I sold cars. I sold knives. I sold advertising. I sold mobile homes. I played in a band. I tried the lawn mowing business, the health club business, telemarketing, a roofing business. I was an apartment manager, worked in shipping and receiving, copier sales, the window tinting business, and onsite real estate sales. You name it, I tried it. I either recognized that the job was going nowhere or I flat out failed, but either way I was perpetually moving on. Looking back, I’m sure it didn’t help that in my early twenties I looked like I was sixteen. Who wants to buy a car or a home from a guy who looks like he’s sixteen years old?
Fast Forward: Somewhere my Momma has a stack of business cards about three inches thick. She brought them out and showed them to me once when I was talking about how lucky I was to have so much in life. She said that being grateful was a wonderful trait but that she was not sure at all about how “lucky” I’d been. I was about to protest when she handed me that stack of business cards tightly wrapped with a rubber band. I released the rubber band and began to flip through all the different cards. I got quiet as I revisited every failure one at a time. There were so many failures, and many I’d forgotten about. Once I saw them I remembered every single job or venture, and the disappointment wrapped up in them. Mom broke the long silence, “I know you and I’ve saved these cards for this day.
You’ve been busting your little tail end ever since I can remember. Be grateful for your health or your parents or your God-given abilities but don’t give luck too much due…You’ve fought for every inch of your success.”
As I travel through this life I find myself saying this more and more, “God Bless Mommas.”
I just couldn’t find myself. I couldn’t find what I was supposed to do to make a living. Every time I’d start out excited in my new career, reality would set in, and it was over. The cycle was making me doubt myself. I’d been so successful in high school and now so many failures coming one after another.
During the lows, I always managed to make ends meet. I don’t know how but I also always managed to keep my good credit. I never asked my parents for any money, but Dad would slip me a $100 every now and then, figuring I could use it. He wasn’t wrong. More importantly, both my parents were supportive. Their emotional support ran deep and wide. I don’t ever recall them laughing at any of my crazy business ideas. I don’t ever remember them saying, “That won’t work,” or even, “Are you sure about this?” They always said something to the affect of, “Great, it sounds exciting! Let us know how it’s going…let us know if we can help.” My parents were always enthusiastic and always encouraged me. I can only imagine how they must have worried about me. I was falling down so often.
Somewhere in my failures, I began to see how easy it would be to be homeless. I completely realized how often I was just one paycheck away from being in the street. It seems like that should’ve tamed my capacity for risk but really it emboldened me. You see, I had a net and I knew it. I always knew I could go home if things really got bad. On the day I moved out, Momma was standing in the driveway waving goodbye in tears as I left, and I never moved back in. I knew I could have moved back if I’d needed to. I knew that. That one thing alone could well be the reason for the way things turned out in my life. It would be a bold face lie to say that having such a net didn’t immensely change the way I looked at risk. I might have been young, dumb, and failing, but I was smart enough to know that now was the time to try and fail. I knew that I would never go hungry or have to sleep in the rain as long as I had my wonderful mother and father and I could make my way to them. To this day, I am grateful for that net.
Change that little ingredient and my life might taste very different today. I am very grateful for the parents God gave me. And as sure as age comes to all of us, I can assure you that neither my mother, nor my father, will ever go hungry or sleep in the rain, not if I am alive and can function. I pray they will never need me, and they probably won’t, but that is my promise to them. That is their net.
Stay Out of the Ruts
Take some chances…choose a path less traveled.
The bartending kept me afloat, but I didn’t want to get caught in that routine like so many others. I’ve witnessed it first hand. I worked with several guys and gals that’d been in the bar biz for twenty years or more. Bartending was great at twenty-something but I just couldn’t imagine being a bartender at forty or fifty years old working for $2.00 an hour plus tips. I always had two things going: The bar job and my new business of the month.
Along the way, someone told me that owning rental houses was the way to get rich. So, I rented out my first condo and purchased another larger one across town on Powhatan Street. My new two-story condo had two bedrooms and two baths and a kitchen and a den with a fireplace. I rented out the second room of my new condo to a roommate, and that money, together with the positive cash flow from my first condo, made the payments on both condos a non-issue.
As long as I had a roommate and my first condo was rented out, I was living for free! Eventually the volatility of condo association fees would drive me away from condos, but for awhile there I really enjoyed this condo ownership thing I had going.
I also bought some property out in Boerne, Texas, around that time. A man sold me a lot high up on a hill and financed it for me. The day I closed on it, I drove my mother out to see my latest conquest and to celebrate the occasion. We picked up a bottle of champagne and two long-stemmed champagne glasses along the way. We got there and hiked up to the very highest point. It was beautiful there and we could look out over the countryside for as far as the eye could see. I popped the cork on the champagne and we made a toast to the beautiful Texas hill country and my new purchase. The day was sunny and clear and the view was fantastic—then Mom slipped!