One hour into my first investor meeting and I'm doing quite well: I've already bought a three-bedroom/two-bath house, scored 400 cheap shares of a pharmaceutical stock and earned several thousand dollars from my new lawyer gig.
But my host, Marco Caporale, has fared worse: He's been saddled with two kids, bought a condo that never appreciated and can't seem to scrape up enough money to get out of the rat race. Despite the bad luck, though, Caporale is still smiling.
That's because, with three people and a reporter, this is the biggest turnout so far for Caporale's Cashflow Club game night. Since February, the 29-year-old Lithia resident has gathered a small group of like-minded people to share the investment strategies of best-selling author Robert (Rich Dad, Poor Dad) Kiyosaki and play the financial guru's patented board game Cashflow 101.
But this is not a typical investor meeting. For one, there are no empty-suit types in attendance — just guys in T-shirts and shorts eating free pizza. Most importantly, the thousands of dollars in cash on the table is only play money. Though some investing tips may be shared, the main point of the evening is to play this Monopoly-meets-Game of Life board game.
Caporale joins nearly 100 other organizers across the United States who have shelled out $195 for Kiyosaki's game and started Cashflow clubs in their communities. The object: hands-on experience in applying Kiyosaki's theories that stress acquiring businesses and real estate instead of the traditional investment strategies of stocks, bonds and mutual funds. For hosts like Caporale, game nights are an easy way to network with other investors.
Joining him tonight are 28-year-old Omar Fuentes, a partner in his investment company, and two newbies: Winter Haven resident John Hosegood and Caporale's brother-in-law Derek Fournier.
After Caporale shuffles the cards and each player fills out a financial planning sheet, we draw cards to determine our professions. Caporale takes the policeman. Hosegood becomes an airline pilot. Fournier, a computer programmer by day, goes from white collar to a blue-collar truck driver gig. I'm a big-shot lawyer, making $2,200 every paycheck.
We roll the dice and move our game pieces — little rats in business suits — along a circle named, you guessed it, the "Rat Race." As our rat-faced figurines travel around the circle, we collect paychecks (minus expenses like mortgages and car payments), buy stocks, trade houses and attempt to avoid traps along the way like the "Downsized!" space and "Baby" cards that deplete your income each turn. The goal: to collect enough money or investments to pay off all our debts and leave our jobs. Then we move to the "Fast Track," where we can start businesses, run for mayor and earn financial freedom.
But none of us will leave the "rat race" tonight — the board game usually takes five to seven hours to complete, plenty of time for players to ruminate on their own financial struggles.
Hosegood, for example, shares his own checkered work history: The 37-year-old from Winter Haven has been the victim of six lay-offs in his working life, the last one as a worker in the phosphate mines of south Hillsborough County.
"I was a little bit bitter about that," he says, spitting chewing tobacco into a cup. "After that, I kind of took a long look at myself and said, 'This is the last time I'm doing this.' I want to do something to make a living where the destiny is in my hands. And I found that in real estate."
But now that the housing market has taken a bit of a downturn, Hosegood is looking into other types of investment.
"I'm not here to pimp real-estate business, but I thought worst case scenario I could talk with people of similar interest," Hosegood says. "I don't want to live off my commission for the rest of my life."
As our rats scurry around the board, Caporale, a former financial advisor for Morgan Stanley, tells his own story. After years of "working hard to help other people stay rich or get rich," he quit in March 2000 to pursue his own investment company. Now that he's found success through real estate, Caporale has a unique way of describing the Morgan Stanleys and Merrill Lynches of the world.
"Financial advisors are nothing more than prostitutes," he says with a smirk. "The pimps are the major investment Wall Street firms. They're the ones who hire the prostitutes."
And the johns, he says, are those of you seeking financial services. (You can probably guess where the analogy goes from there.)
Two hours into the game and I have the most money and investments — until I land on the dreaded "Downsized!" space and lose two turns. Although I'm no longer in the lead, Caporale reassures me that the point isn't winning the game or getting to some endpoint. It's about education.
"Make the mistakes here, change your mindset and then do it on the outside," he says.
Hosegood nods his head.
"I was just thinking I need to stick some money back for a rainy day," he says after hitting the "Downsized!" space.
Still, one thing was bothering me: Like many Americans, I have little savings and some hefty student loan debt. How can I ever think of taking risky chances with investment? Don't you need money to make money?
"You don't need a ton of money to do certain things," Caporale counters, pointing to his own portfolio. Instead of investing his own money into projects, he convinces other investors to put up the money for him and takes a percentage after the deal goes through. Since 2004, he claims to have made over $750,000 in real estate investments without ever putting a penny of his own money down. Caporale hopes investing stories like this one will attract a younger, edgier crowd.
"We're really looking at pissing off the industry," he says. "[Major investment firms are] a good ol' boy network, but there's a younger generation coming up that is different, more sophisticated. And we're starting to make money, too."
The next Cashflow Club game night is July 3 at the FishHawk meeting center, 6930 Osprey Ridge Drive, in Lithia. For more information, contact Caporale at marco.caporale@iemira.com.
This article appears in Jun 20-26, 2007.
