In this episode of Zen and the Art of Real Estate Investing, Jonathan welcomes experienced investor and fund manager Lon Welsh to explore the journey from hands-on property management to building passive income at scale. Lon is the founder of Your Castle Real Estate and Ironton Capital. Over the past two decades, he has transitioned from flipping homes and managing rentals to helping investors diversify through professionally managed real estate funds.
For anyone looking to move beyond being a landlord or curious about passive investing as a path to financial freedom, this episode provides practical strategies grounded in real-world experience.
From Basement ADUs to Fund Management
Lon’s story starts with a basement ADU and a desire to live below his means. That early focus on financial discipline allowed him to invest aggressively and eventually flip properties, buy long-term rentals, and participate in large multifamily syndications. However, over time, the realities of managing tenants, coordinating repairs, and balancing multiple projects began to take their toll.
That’s when Lon began to rethink his approach and eventually launched Ironton Capital, a fund-of-funds platform designed for investors who want diversification, scalability, and a more hands-off experience.
Reducing Risk with Diversification
Through Ironton Capital, Lon helps investors access diversified portfolios of real estate assets. This includes a mix of asset types, like multifamily, industrial, and storage, spread across various markets and operators. He explains that this structure reduces single-operator or single-market risk and provides consistent returns, even during volatile periods.
Rather than hunting for one-off deals, investors gain exposure to a broader strategy without needing to manage properties themselves.
Passive Investing Without Losing Purpose
Lon believes that passive investing shouldn’t mean “set it and forget it.” Instead, he encourages investors to stay involved through education, strategic planning, and working with trusted partners. This mindset enables people to align their financial goals with the lifestyle they desire, whether that’s avoiding burnout or planning for retirement.
He also shares tips on vetting general partners, reading between the lines on pitch decks, and avoiding common pitfalls in passive real estate deals.
Key Takeaways
- Passive wealth starts with intentional planning and strong financial habits.
- Diversification across assets and markets helps reduce volatility and improve outcomes.
- Fund-of-funds structures offer scale and simplicity for busy investors.
- Choosing the right partners is just as important as choosing the right property.
- Passive investing creates freedom when paired with education and clear goals.
Lon’s path shows that real estate can be more than just transactions. It can be the foundation for a life of financial clarity and personal freedom.
If you want to learn more about Zen and the Art of Real Estate Investing Podcast, check out https://zenandtheartofrealestateinvesting.com/podcast/249/.