Introduction
[Kim Flynn]
Hey, Richard. How are you doing?
[Richard Bexon]
Good.
Thanks for taking the time to join us here on the podcast.
[Kim Flynn]
I’m excited to be here.
[Richard Bexon]
Not at all.
I think your story is somewhat unique, so it’s going to be great to be able to share that with all of our listeners and also for you to give a little bit of advice to them as well.
[Kim Flynn]
I love that you think my story is unique. Doesn’t everyone end up in Costa Rica when their business fails in 2020?
[Richard Bexon]
To be honest with you, I think it’s also the path that you’ve decided to take and just the risk that you took. It seems to have paid off, so I’m sure we’ll get into that. My first question, Kim, always is with Western markets where they’re at the moment, volatility, even though they keep going up and up and up.
Some people say bubble, some people say not. We’ll see, but that word is thrown around all the time. Definitely, the volatility is here to stay, that’s for sure.
What are you seeing happening in Costa Rica?
Western Markets and Impact Investing Philosophy
[Kim Flynn]
Let’s talk about what’s happening in the US as well. I’m wanting to pull all my money out of the US. Not necessarily because I’m trying to predict the market or anything like that, but because I want to support projects that I can really get behind.
The US is tough to get behind these days. I’m wanting to pull my money out and putting it towards projects that I feel passionate about, projects that support communities. I’ve chased profit for a long time.
At this phase of life, I’m chasing impact, I’m trying to do good in the planet and do good to the people that I know. That’s why I’m investing in Costa Rica now because it’s so dang fun. I love the people that I’m working with.
[Richard Bexon]
That’s true.
It’s not always easy, but again, as I always say, if it was easy, everyone would do it. Thank God it’s not easy and everyone’s not doing it.
[Kim Flynn]
I was expecting, because I have a hotel in Costa Rica, I was expecting things to be a lot harder. I was expecting to have huge challenges in the renovation. I was expecting to have huge personnel challenges.
Of course, there are wobbles. The banking system is a trick, as you know. That’s been a trick.
The government in general is a little bit of a trick, but compared to larger companies I’ve run in the US, this has been pretty easy, I hate to say.
Safety and Security in Costa Rica
[Richard Bexon]
We’ve done some podcasts before at the moment. I think there’s a lot of concern over security and just exchange rate in Costa Rica, just because it’s so expensive. Do you feel unsafe in Costa Rica?
Do you feel safe?
[Kim Flynn]
No, I’ve traveled a lot in Latin America. I grew up in Bolivia and Venezuela, so I’m very familiar with travel in Latin America. I know that many US travelers especially are really nervous travelers.
If they have only been to the Marriott and Tamarindo, you might be nervous. I have never felt unsafe in Costa Rica, even a tiny bit. There’s a different feeling.
You step off the airplane in most Latin American countries and you hold yourself differently and you are uber aware of everything in your surroundings. In Costa Rica, you step off and you can feel it in the air. It’s just relaxed and you’re like, oh, I’m safe here.
I have never personally felt unsafe. That said, I’m a pretty savvy traveler and some people do get nervous, but I’ve never felt scared or nervous.
Kim’s Journey to Costa Rica
[Richard Bexon]
What’s been your journey so far when it comes to investing in Costa Rica?
[Kim Flynn]
I had about a $10 million business in 2020 and we closed our doors. It was a live event training business. I didn’t know what I wanted to do with my life after that.
I took a couple of years and just cried on the couch for a while. Then I came to visit Costa Rica. My sister had some property here.
In Samara, within a couple of days, and this happens all the time to travelers in Costa Rica, it’s the street dogs and the horses roaming the street and the Pura Vida culture and the ocean. It just sucks you in and enchants you. Within three days, I was like, oh yeah, I want to live here.
I started looking for a retreat property. I had ran retreats in my previous business. I started looking for a retreat property almost immediately and found out that it’s pretty much a cash market.
I found some investors to go in on a different retreat business. That fell through. It didn’t feel right.
Then I was walking down the beach one day in Samara and the old owner of the property that I own was out in front hanging the for sale sign on the tree. I was like, hello. It was one of those meant to be situations.
I find that happens in Costa Rica more than any other place I’ve ever done business in. Serendipities just happen. That’s how I found my retreat center that I have now.
I bought it as a hotel, converted it into half hotel, half retreat center. It’s worked really well. We’ve had really good results.
Now I’m looking for the next project. That’s my evolution.
Retreat Center Business Model and Demand
[Richard Bexon]
I’m about to ask, do you think there’s enough runway still for retreat centers in Costa Rica? It seems to be it’s been quite a hot spot for them. It sounds like your answer to it would be yes.
[Kim Flynn]
Here’s the thing. I don’t know about retreat centers for people that don’t run retreats. I run retreats.
I have a lot of experience running retreats. I’ve ran about 500 retreats in my career. I fill my own location.
I couldn’t tell you about buying a retreat center and just hoping to bring in other retreat hosts or leaders. I think that’d be a different ballgame than what I do, which is fill my own retreat space.
[Richard Bexon]
You’re in control of your own destiny, which I love. I hate relying on third parties. Hence why now I have a construction company, development company, and a property management company from start to finish.
Retreat demand is still strong?
[Kim Flynn]
Very strong. Retreats are hot and trending. We’re having no problems filling our retreats for sure.
Retreat Center Business Model and Demand
[Richard Bexon]
What advice would you give to anyone looking to invest in Costa Rica?
[Kim Flynn]
I would say expect a slower pace of life. If you try to pretend investing in Costa Rica or running in Costa Rica is going to be the same as in the U.S., you’re going to be disappointed. You have to go with the flow of Costa Rica.
I would recommend getting someone from the area, or at least who speaks Spanish really well, from Costa Rica on your team as soon as possible. They are going to help you navigate government systems, banking systems that are going to be different from your culture. Don’t be rude to people.
That’s probably my biggest advice. Don’t come in thinking, I hear this so frequently from hotel guests, and you probably hear this all the time, Richard, from investors too. That’s not how we do it in the U.S. The way we do it in the U.S. is so much better. The banking system is so much better in the U.S., and you have to just put that aside. I want to just scream at people sometimes, you’re not in the U.S. Let’s embrace that we’re in a different culture, that there are different rules, there are different banking rules, different government rules. Some things are harder, and some things are a whole lot easier as well.
Just embrace that you’re in a different culture.
[Richard Bexon]
The advantage of that is Costa Rica has a little bit more organic growth, because you can’t just walk into a bank and get a loan. It’s very difficult. You better have a lot of passion for what it is that you do, and be ready for those wobbles.
Again, don’t get upset at people, because here they will close down and not hurt you. There is a certain way of doing business. I’m always reminded by the Wolf of Wall Street when they went to Switzerland, and they had 15 minutes talking small talk before they talked business.
It’s very similar here, if that makes sense. It’s 80% small talk and 20% business.
[Kim Flynn]
Agreed. Just go at the Costa Rican pace. For those of us who are used to a really fast, aggressive, strong pace, it’ll be a little bit of a culture shock of being like, okay, we’re just going to slow things down.
We’re going to go at a slower pace.
[Richard Bexon]
Look, for someone that comes from the Western world, I’ve been here for 20 years now, and I move at a really fast pace. You just need to learn a certain way to do it, but you can’t do it straight off the bat. You have to understand all of the smaller, finer details and culture and everything, and know where to push and where not to push.
Otherwise, it’s passive aggressiveness. You need to know how to do it. Also, in another language, sometimes words being used in business or in construction are not the same words that you normally would use.
Also, words in Guanacaste sometimes are different, and in different parts of Costa Rica as well, I found out. The word for machete is cotacha in Guanacaste. If you say cotacha somewhere else, they won’t know what you’re talking about, unless it’s in Guanacaste.
Again, what are the challenges that you think you’ll face going forward, or that Costa Rica’s going to face going forward? For you, as you said, you do your own retreat, so it’s a lot easier. I can’t see why someone would probably buy their own retreat center to just be a third party and rent it out to retreat leaders.
I’m sure there’s a business there, but if you don’t know it, it really doesn’t make sense. You’d be starting from scratch.
[Kim Flynn]
I see it. I know two other retreat leaders who have purchased retreat centers without any retreat experience under their belts. They’re just like, we’re going to open up a retreat center.
I think the decorating portion and the holistic portion calls to them. I’m like, that’s a tough business model, because then they have to learn how to recruit retreat leaders to come to their space. I’ve seen that done a couple of times, not very successfully.
I don’t know if I would recommend that people would invest without any retreat knowledge, just straight out of the gate, I’m going to open a retreat center. I don’t know if I’d recommend that. For people who run retreats on a regular basis, even if you run, let’s say, four to six retreats a year, so a smaller operation of retreats, it might make a lot of sense for you to own your own retreat center.
People are very willing to jump on a plane and go to Costa Rica. They very much want to. My previous business, we did retreats in the U.S., a few international, but mostly in the U.S. I would say people are more eager to jump on an international flight to Costa Rica and to attend a retreat than to go to a retreat in the U.S. Unless you’re in a really spectacular oceanfront location in the U.S., you might as well buy a retreat center in Costa Rica or beyond versus the U.S. I had one, two, three, probably four or five retreat centers over the years in the U.S. Costa Rica is not hard to fill. If you are a current retreat owner or retreat runner, Costa Rica has been great.
Unexpected Costs and Maintenance Challenges
[Richard Bexon]
Kim, maybe this is a bit off subject, but what are some of the costs that you weren’t expecting of having a retreat center in Costa Rica? Let’s see. Some of the shocks or anything you were like, wow.
[Kim Flynn]
Yeah, yeah, yeah. When I bought the retreat center, it’s a small retreat center in front on the beach, and then there’s a house behind. I did a full renovation of my house because I was going to live there, which I still do.
I live there half-time. The surprises, I don’t know if there’s been any line item surprises. My project came in on budget, which is nice.
[Richard Bexon]
On time?
[Kim Flynn]
Well, I’ve done a lot of construction in the past, so I knew it would be double of what was promised, and so I was expecting that. If you weren’t expecting that, you’d be surprised, but it was no slower than a U.S. renovation project. That has been just fine. I think what has surprised me the most and what has been more expensive than anticipated is maintenance. My property is right on the beach, and that salt water blows in and destroys everything.
I mean everything. If there is anything metal in your property- ACs, TVs, everything. Everything.
We don’t have microwaves in all of our units. All of our units have kitchens, but we have only one microwave for the entire place. They have to go to the office to use it, and we’ve replaced that microwave three times in a year and a half.
That salt water is no joke. It destroys everything. You have to rewire your property every, I don’t know, five, six, seven years.
Rewire the walls. This is how intense that salt water is. If you’re planning on being near the ocean, expect a really high maintenance budget.
But you can charge more. Yeah, you can. Plus, you’re on the beach.
Come on, you’re on the beach. One more thing I wanted to talk about too. In the U.S., when you’re doing a renovation, like you take over a new project, right? You’re like, we need a new roof, we need new walls, we need new kitchens, whatever it is that you need. And you budget it all in, and you do one big blast, and you do the whole renovation. And then you’re like, oh, I won’t need to redo that for 20 years, right?
And you think, the roof will last 20 years, the ACs will last 15 years, like whatever. You think you can expect that. That’s the worst way to do things in Costa Rica, because you have to suck the life out of every little piece, right?
So bear with me. So if that metal roof has another five months on it, you give it all five months. And you don’t replace it until it has a hole in it, right?
In the U.S., it would be like, oh, it looks like it’s going out, let’s replace it. No, no, you will not be able to make profits, because you have to squeeze the life out of every asset you have for as long as you can in Costa Rica. And that’s why you can go to the hardware store.
It’s just a different culture. You can buy three screws. In the U.S., you buy 200 screws. In Costa Rica, you buy three screws. You replace things as they die, not when they start to get a little bit ugly, if you want to be profitable. So that’s my best advice.
Squeeze the life out of every asset.
[Richard Bexon]
And preventative maintenance, like repainting that roof as much as you can as well. Again, just being on the ocean is, again, its own nightmare. We build houses on the oceans here, and we’re just like no exposed metal, that kind of stuff.
So we do a lot of actual concrete and all the tubings in concrete so that we don’t have all those issues and stuff. But it’s still, I mean, anything just eats everything. Well, you have a new project coming up in San Mateo.
You already have one, you’re looking at another one. You and I chatted about it the other day. But tell us about it, what makes it unique, how you came about it.
Tell us about what you think that journey is going to be.
New San Mateo Project and Expansion Plans
[Kim Flynn]
Yeah, we are actively looking for investors for another beachfront project. I didn’t think one was enough. I want to take on another one.
Actually, I love the project portion of it, right? Like running retreats, great. Running the hotel retreat center, great.
But like the project piece is what makes me light up. And so whenever I see a property that’s kind of falling apart, I just get excited. So that’s what I’m excited about it.
It’s kind of falling apart, and I can’t wait to get my hands on it. And so we’re going to completely transform that space. Also, in a year and a half since I have purchased my retreat center, we’ve completely maxed it out.
So I don’t have any more room, I can’t grow. We run the hotel season about six months out of the year, retreat season the other six months out of the year. I’m able to run retreats.
I’m running retreats right now in the middle of October in rainy season. I love rainy season. I know, a lot of people do.
It’s harder to travel in though. And so we’ve used up all of the time that we can spend in that place. And so I’m looking for something bigger to expand into.
So that’s what I’m looking at now.
[Richard Bexon]
So I mean, anyone that’s listening, that’s interested, I mean, who are you looking for? What is, do you think the investment size is Kim? Just to give anyone an idea.
[Kim Flynn]
Yeah, we’re looking for about a 1.5 million investment. The property is worth more, but that’s how much we’re still looking for and needing. So if anyone is interested, if you have retreats, especially if you run retreats and you’re looking for access to a retreat center, if you wanted to invest here, you could get in at 1.5 and have access to a much larger, much nicer property than 1.5 would get for you. So I’m pretty picky on my partners. I’m not looking for anyone. I like people who are really easy to work with, who have experience in the industry and people I just like.
That’s what I want to spend my time working with, people I like. And so that’s what we’re looking for.
Partnership Philosophy and Texas Shootout Clause
[Richard Bexon]
No, I mean, I think that’s it. Look, I mean, a partner, I’ve had many partners in business. It’s no different than a partner in life a lot of times.
Yes, exactly. You know, you need to choose them wisely. So I’ve had many partners and thank God, the majority of them have worked out well.
I’ve had a couple that haven’t, but like, you know, there’s always a, you know, as I like to call, we call it a Texas shootout clause in there, which is a good clause to have in any partnership agreement. So, but yeah.
[Kim Flynn]
A Texas shootout. Wow.
[Richard Bexon]
Well, it’s a great clause because basically it’s like, if you and I were business partners and I was like, look, I don’t want to work with Kim anymore. I can make you an offer, but I need to be careful what I offer you. Cause you can turn it back and buy me out for that offer.
[Kim Flynn]
So got it. Interesting.
[Richard Bexon]
So it’s so that I can’t lowball you.
So if I’m the majority and I want to buy the minority out, I also need to know that as soon as I make you that offer, Kim, you can turn around and buy me out at that rate. So I have to be okay with that rate.
[Kim Flynn]
Interesting. I like that. I like that.
It sounds very fair. It’s kind of like the principle of, you know, as a mom, you, you, you have your kids like cut the candy bar in half and then the other person gets to choose which half, you know, that same principle. Yeah, exactly.
Texas shootout, candy bar splitting. Yep. Important principles in business.
[Richard Bexon]
Exactly. Exactly. Well, Kim, I’ve kept you long enough for my last question for you, which I’d love to ask everyone.
If you inherited $500,000 and you had to invest into a business or real estate in Costa Rica, what would you invest it in and why?
Final Investment Recommendation
[Kim Flynn]
Well, 500,000 wouldn’t go very far for me. So make it 5 million and then we’re talking, right? But if I had a chunk of change to invest, I would definitely buy this project outright and do renovations and get it up and running immediately.
So that’s an easy one for me. It’s what I’m looking for right now is just investment. So easy question.
[Richard Bexon]
Where else would you, do you think the opportunity is in Costa Rica or let’s say in Samara?
[Kim Flynn]
You know, I mean, I like to stay close. I love, I don’t want to travel all around. I know you like to jump on a jet and fly all over the place.
My previous career, I traveled enough for an entire lifetime. So I want to stay really central. So I would look at other Samara properties and, and keep it really close, really, really local so I can just pop around to all of them.
[Richard Bexon]
And you’d leverage your knowledge and also probably some of your staff. And I mean, that’s the great thing about having one and that learning and pushing you across to another one is you can also leverage all the staff and the marketing and everything you have.
[Richard Bexon]
So, yeah.
[Richard Bexon]
Well, Kim, it’s been an absolute pleasure having you here on the podcast. Thank you very much for taking the time to chat with us. Anyone that’s interested in chatting with Kim, I’ll put all of our contact details in the description down below, but very much appreciate your time.
[Kim Flynn]
Perfect. Thanks, Richard.
[Richard Bexon]
Thanks very much, Kim.
