In this episode of the Collective Genius Podcast, I sit down with David Richter—real estate investor, fractional CFO, and author of Profit First for Real Estate Investing. David lays out the truth most entrepreneurs avoid: revenue is vanity, profit is sanity, and cash flow is king. Whether you're scaling a flipping operation or running a fund, his system helps you take control of your money, reduce stress, and build a business that serves your life.

We dive into the most common financial pitfalls real estate investors face, why most 7-figure earners still feel broke, and how simple cash management can completely transform your decision-making. David shares how to set up the Profit First system inside your business, how much cash to actually keep on hand, and how to avoid the silent killers—owner draws, tax shocks, and marketing waste. This episode is a must for anyone who's tired of making money but never keeping it.

Timeline Summary

[0:00] - Introduction

[2:30] - David's background: losing it all, then rebuilding with Profit First

[6:10] - Why high revenue often hides poor financial health

[10:20] - How to build a cash flow system that pays you first

[14:00] - Setting up the five foundational bank accounts

[17:50] - Common traps: marketing waste, bloated ops, and tax panic

[21:30] - How much cash to keep—and where

[25:40] - Real-life examples of investors who turned around their finances in 30 days

[30:00] - The mindset shift from "more deals" to "more margin"

[34:10] - What to do if you're always behind on taxes or team payroll

[38:30] - Advice for building a financially free business that doesn't depend on growth

5 Key Takeaways

1. Profit Isn't Optional—It's a System – With the right setup, profit becomes automatic, not accidental.

2. Revenue Means Nothing Without Control – High income without clarity leads to chaos and cash gaps.

3. Start with Five Bank Accounts – Separate money for profit, taxes, ops, owner pay, and income to eliminate confusion.

4. Cash Flow Drives Freedom – Managing your cash right lets you say no to bad deals and yes to what matters most.

5. Financial Clarity = Leadership Power – When you know your numbers, you lead with confidence—not guesswork.

Links & Resources

• ProfitFirstREI.net – Learn more about David's Profit First system for real estate

• Book: Profit First for Real Estate Investing by David Richter

• ExploreCG.com – Join the Collective Genius community

If this episode helped you rethink your financial systems or inspired you to pay yourself first, be sure to follow, rate, and review the Collective Genius Podcast. Share it with someone who's making money—but not keeping enough of it.