THE QUEST FOR OWNERSHIP:

Kevin fed his entrepreneurial hunger by establishing a web development company called iNet Marketing, together with a fellow Morehouse alumnus (Michael Hoight). Kevin and Michael's target market was large African-American organizations (churches, radio stations). For two guys fresh out of college, they made great inroads into the business very quickly. Yet Kevin felt that they were not achieving their full potential as young entrepreneurs:

Kevin Riles, Quest Capital Mortgage:
"I didn't know what I was doing. I didn't know how to get business. I had the gift of gab, but I didn't know what I was doing. There was TOO much competition in web development, so rates were going down. iNet Marketing kind of petered out. Our lives changed, and we eventually moved on."

Kevin was undeterred. His next entrepreneurial opportunity presented itself through a friend that was big into real estate investing.

Kevin Riles:
"The guy that got me into real estate is an engineer who started buying real estate left and right at 30, and retired from his corporate job at 40. He was a mentor, and I drew inspiration and guidance from him, but didn't follow his footsteps exactly. We did it differently. He stayed in corporate America. After work everyday he was out looking at real estate properties. He and his wife lived off of one salary, and banked the other salary. I wasn't trying to stay in corporate America, period."

Kevin started small by buying a duplex, moving into one side, and renting out the other. Thus began his road to financial independence. Shortly thereafter he got his real estate license, and it was on. Kevin started helping his real estate mentor sell homes, relying as usual on his gift of persuasion (gab, as he likes to call it). All this time Kevin was making strides at Exxon, frequently traveling to Europe to lead various e-commerce projects for the company. He was also going to night school to pursue an MBA in Finance. Ambitious? Yes. A little crazy? Maybe. Did he get it done? Absolutely.

In 2000, Kevin left Exxon after a 7-year career to pursue a more lucrative opportunity at Management Information Systems, a much smaller company (25 employees).

Kevin Riles:
"For me it was a no-brainer. I had left Exxon, Finance MBA, Computer Science degree, e-Commerce expert, and going back and forth to Paris every other month� at the time, my skills made me a hot commodity. When I left Exxon to go Management Information Systems, I really knew that I didn't want to do that, but I couldn't pass up the money."

"Exxon is a world-class organization as far as customer service, management skills, and professionalism go. I got to deal with people from different cultures, backgrounds and so on, which allows me today to relate to and work with just about anyone."

"I needed to work for a small company though. God places you in places that you need to be. I was able to see how a small company was run; how decisions were made � it's a very different animal from a large corporation."

A year later, Kevin's real estate business had grown to a certain point, and he decided, that it was time to take that leap of faith. Kevin resigned from his corporate job, and started working his real estate business out of his home, full-time.

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THE BUSINESS:

Kevin actually runs two companies: QUEST CAPITAL MORTGAGE (debt consolidation, home equity loans, financial services) and UPSCALE REALTY services (real estate business). Being a numbers guy, Kevin uses the real estate business as a value-add to the Financing business. Kevin is motivated by teaching people about financial management, and presents real estate as one way to improve their financial picture.

Kevin Riles:
"I target first-time homebuyers. I like to educate folks. Motivational speaking is my other passion; it excites me as much as the real estate business does. I like first-timers because I can teach them. They think it's going to be a daunting task, but I can put them at ease. When you leave us, I want you to know what you're doing."

Kevin advertises his business mostly through direct mail postcards and flyers. As a testament to the high quality of this brother's services though, his company receives about 90% of its business via happy clients!

Kevin Riles:
That's one of the things I am most proud of. When you refer a company to a friend, that means that you had an excellent experience.

The HBCU Network:
What are some of the accomplishments your company has made that you are most proud of?

Kevin Riles:
The main thing is that we make peoples dreams come true. Home ownership in America is still a pretty privileged event and a lot of people don't feel that they can get a home. When I attend closing for my clients, the look on their facing makes me feel as though I have really had an impact on their life.



The HBCU Network:
How does Quest measure success / what makes Quest successful?

Kevin Riles:
We measure success by the following:
a. Are our clients happy and satisfied with their experience? (Most Importantly)
b. Are we providing extraordinary customer service?
c. After doing the first two, Are we profitable? If we exceed at the first two then we 9.9 times out of 10 are profitable.

What makes us successful? Our motto is that we are "The Mortgage Finance Experts". I think our "education philosophy" takes a lot of anxiety out of the home buying process and our clients appreciate that. They don't feel as though they are in this by themselves.

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ABOUT REAL ESTATE INVESTING:

Kevin initially got into real estate to buy his first home, a duplex, as an investment. He lived in one side, and had his tenant in the other side covering the entire mortgage. By purchasing his first home in a gentrification area (Deteriorated urban property that is being restored and upgraded), Kevin was able to get good cash flow and good property appreciation. The house appreciated from $80,000 - $150,000 in 2 years! The man seems to have a knack for good timing and an eye for good opportunities.

Kevin Riles:
"I think most people should look into real estate investing. If they're not the landlord type, they should put their money into Real Estate Investment Trusts (REITs). These are similar to mutual funds. They could involve shopping centers, apartment complexes, or single-family rental homes."

"If you can be a landlord, it is the safest investment that you will have over time. Wealth used to be how much land (not money) you had. If you look at most of the Forbes 500 that just came out, most of those people are entrepreneurs, oil, or real estate people (-ex- Donald Trump). Typically real estate appreciates at 5%/year nationally. If you buy a rental property in a good working neighborhood, not only is your investment appreciating, but you are also getting a monthly cash flow from rent."

"With stock you get appreciation via stock OR cash flow via dividends, but typically not both."

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Kevin's Advice on Real Estate Investing:

Kevin has some thoughts for individuals interested in real estate investing:

1. Buy homes in working-class neighborhoods where folks want a nice house and don't have the credit or income to buy, but can afford the rent.
   
   
2. Look at areas close to downtown.
   
   
3. Look at areas close to major corporations like Fedex in Memphis, IBM park in Jersey, Bank of America park in RTP. If you find property undervalued in those areas, those are good purchases because you know that you will have a steady stream of new renters.
   
   
4. I'm big on duplexes and fourplexes. 1 unit can pay your note, and the rest is gravy. In a 4plex, you want one or two of the units to pay your note, and the other 2 to be profit.
   
   
5. I have some friends that all looking into strip centers (200-300K). You don't have to deal with tenants not paying. Small community shopping centers are a good opportunity as well.
   
   
6. If you're a novice, then single-family duplexes are best.
   
   

Just realize that when you finance investment properties your costs are higher, because interest rates are typically higher.

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WHAT IS THE FUTURE FOR QUEST CAPITAL MORTGAGE?

Kevin Riles, Quest Capital Mortgage:
I want to grow the company from one that brokers loans via larger banks, to one that sells loans (lending my own money). I want to grow into a mortgage bank. I'm looking to get a warehouse line of credit (like $2 million), which will allow me to lend money in my company's own name. That way, I can be a lot more aggressive in pricing, and I can be licensed across state lines.

I'll continue to concentrate on first-time homebuyers, and maybe credit-impaired folks.

I'd like to also take more advantage of the Internet for demand-generation and sales origination. I plan to grow my area of jurisdiction beyond Texas, all the time increasing my company's efficiency as I grow.

I could become licensed as a broker in other states, but I'd rather be a mortgage banker.

The HBCU Network:
How can Quest help HBCU Network members in the Dallas area?

Kevin Riles:
We are licensed to do loans in the state of Texas. However, if there was enough interest I would be willing to fly from Dallas for a home buying/real estate investing class. I think it is important that African Americans own real estate. We should first and foremost own our own homes, but even after that in the forms of investment."

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