Real Estate Disruptors

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Do with a Purpose

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So you want to be in real estate? Wouldn’t it be nice to have those big profits off each house like they get on HGTV every time?

Here’s the thing:  those profits do exist, and you can get them for yourself.

It’s just not quite as easy as that hour long HGTV episodes make it seem. Yes, even the ones where they had all the unforeseen problems.

Money TruckReal estate is hard work. It is not something you dip your toe into and suddenly the Money Truck backs up to your door.

Purpose

Being a real estate investor requires having a definite purpose. You have to want it. You have to work at it. The rewards are many, and are definitely obtainable. But they don’t fall into your lap.

In fact, almost everyone fails when they start out — deals fall apart, fix and flips lose money (yes, it happens), sellers ghost you. Many of us call that The Learning Process. Well, that’s the rated-G term. Think of it as the weeding out process, because those who lack true purpose will quit when they discover just how unforgiving real estate can be.

Keep in mind, needing a big purpose in order to succeed isn’t exclusive to real estate. If you want to be highly successful in any field, you need a big purpose driving your actions. Otherwise, you squirrel, get distracted by shiny objects, and ultimately quit or limp along being just OK at what you do.

Please don’t confuse purpose with a big bank account. While you can build a big account balance doing what you love with purpose, if you think your purpose IS a big bank account, you’ll never get there in real estate. Or at least if you do, you will be run ragged and hate every minute of what you do. Go be a banker; at least you will be able to see big bank accounts. 

Why?

Don’t people get into real estate to have that big bank account?

For some people, sure. But that’s really an end result or side benefit. You could be just as successful doing all kinds of other work if you tackled it with purpose, poured your efforts into it, learned the industry, and loved working in it.

This doesn’t mean you have to like all aspects of wholesaling, fix and flip, or any niche. Maybe you love sitting in someone’s living room showing them how you can help solve their problems by buying their house for cash, but you hate cold calling. And that’s fine. You can focus your time in sales and hire people to do your cold calling.

But you have to build to that point.

It’s All You

When starting out, you need to do it all. Because you’re the business, but also you will need to know how to train people as you grow and bring them on. This also lets you discover what you really love about the process, what you don’t like to do, and where you can focus your passion and purpose.

Once you have your purpose identified, you need to put all your energies into only activities which further that purpose. This may mean you need to hire people to do those things which are not directly related to your purpose, but that’s a good thing. You can hire people who love doing paperwork, for example, when that is not part of your purpose. Hire Virtual Assistants (VAs) or acquisition agents to do your cold calling. 

You may have to do these things until you can grow enough to bring on good people, and that’s part of building a business, moving from solopreneur to entrepreneur. Then you can train them on how to do it the right way.

Purpose is the Reason

Real estate is a fantastic business to own, but in the end it is just a vehicle for your purpose. The fire within you to run a business, the vision of where you want to be, the thing you love to do, THAT is your purpose. Sometimes finding your purpose is difficult. You might need a mentor to help you sift through everything in your life that distracts you so you can see your purpose.

Trying to build a business without knowing your purpose is like trying to navigate to Triumphville without knowing where it is. You can drive all over the place and never come close to finding it, wasting time and missing opportunities along the way.

If you don’t know your purpose, it’s time to find it. Get a map and plan a route. Discovering your purpose is critical to building your business. It may be easy; it may take some looking. You may have to dig deep to pull it out. 

Find your purpose and focus everything in your business to further that purpose. Then you will truly start on your path to success, wherever that path may lead.

So You Want to Own Many Businesses….

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Sounds like a great idea — start a bunch of businesses, hire people to do the work, and rake in the money. I might have to do that.

Only there’s a catch (of course there is):  you still have to run them, put out all the fires across multiple organizations, hire the right people, and not go insane in the process.

That’s actually a whole bunch of catches. You threw your net kinda wide and caught the motherload.

It Looks Simple, but…

That view from 30,000 feet looks pretty simple and serene. Running multiple businesses can exponentially increase the demands on your time. Not to mention the plethora of headaches when a problem in one business actually causes problems in the other ones. Nothing like one problem becoming five, right?

Obviously running multiple businesses can be done. After all, we have all seen people who manage it and make it look easy (at least in public): Elon Musk, Richard Branson, Warren Buffett, just to name a few. 

So how do they do it?

Organization

They have learned to organize their businesses. They have developed systems which they can plug into any business and get it running smoothly. They have systems and standards for evaluating talent and hiring people.

But first they learned how to organize. Delegate. Develop a method so they can offload the work that they don’t like or aren’t good at, specifically so they can spend time doing their genius work.

Organize. Some of us don’t like that word, or the structure it carries. Yet this is the key to growth; the key to expansion. It is the only way to remain sane when you start adding companies like pairs of shoes or cats. If you leave the shoes lying around everywhere, you’re going to trip all over them and ruin them. Same thing with cats.

How to Start

As the business owner, you have a vital purpose — that thing which you are really good at and which is most valuable to your company. Now in the beginning, you may have to do everything. That’s not a bad thing, because you need to know HOW to do everything. That’s necessary, because initially you will be the person who trains new hires. 

As you grow (and growth can occur fast), you must hire the right people who can do the job and who like doing the job. This is where systems come into play. Don’t just hire willy-nilly. Get a hiring procedure which does a proper evaluation of your applicants so you can weed out those who don’t fit your culture or have the work ethic/qualifications/abilities you want. You will save time in the hiring process, and you will have far fewer mis-hires that you have to fire later on.

Put other systems in place to handle other areas:  customer acquisition, marketing, HR, etc. And the more you can both automate and delegate these systems to other people, the more you can shed those work items that aren’t your vital purpose. 

Use Tried and True Systems

Don’t start from scratch trying to design your own system. You don’t have time for trial and error management. Find proven systems and install them. They may cost you some money up front, but they will save you many multiples of that amount down the road. Wasting time and hiring the wrong people are the most expensive mistakes you can make.

As you add businesses, you implement the same systems in each company. This way everything operates the same in each organization, and you don’t have to worry about it. Spend your time doing top-level activities and hire employees to run the other parts of your companies.

New business? Rinse, repeat. You may need some tweaks to the system depending on the specific requirements of that business (such as licensing, permitting, etc.), but the main form of the system should be the same.

This is where scalability comes in. Implementing repeatable systems creates time. You can’t scale up without time to do the work.

As your businesses grow, delegate more to other people. Then your time is spent on high value activities. And the more you can do that, the more you can grow.

So get organized NOW. Implement proven systems to your company, and you will be amazed at the time you save.

Need help? We have many programs to help you get organized, including exact systems to run your business. Check it out here. 

Why You Need to Network

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November 3, 2020

You need to network with your peers. This is VITAL to your success.

Why do I want to network with my competitors?

Why would I share my tips and tricks with them?

What’s in it for me?

Money. Time. Fewer headaches and emergencies. More closed deals. Better leads. Hot tips. Resources. 

But the biggest thing is help. You can get help when you need it, from people who care.

Most people start their business basically on their own. You may have a partner (or a spouse along for the roller coaster ride!), but you don’t have much of a support system, if any. And like most solopreneurs, you slug it out alone, battling all the forces stacked against your success.

You don’t have to.

Networking Benefits

Networking with people in your business is more than just finding like-minded crazy dudes and dudettes willing to swap war stories and have a coffee. Done properly, networking opens all kinds of doors for you and your fellow entrepreneurs:

  • Share resources, like skip tracers, lead sources, organizational systems, software/app choices, others associated with real estate (non-investor professionals), and more;
  • Gain insight, tips and tricks from those who have been in your shoes;
  • Learn how to avoid expensive mistakes before you make them;
  • Find partners for deals, investors to sell to, good contractors;
  • Gain educational opportunities to help you organize and expand your business;
  • Find some deals you may not have found otherwise;
  • And the list goes on and on and on….

Help is the Key

In order for networking to work; however, you MUST approach it from the standpoint of “How can I help?” The group isn’t there to just give everything to you; this needs to be a symbiotic relationship. If you withhold information from someone that could have helped them, you aren’t participating in the group. You’re leeching off of it, and pretty soon you’re going to burn all the bridges you may have built and damaged your reputation in the process.

I have had some of the biggest “Ah Ha!” moments of my career directly from my networking and mastermind groups. It’s possible I might have come across some of these ideas/systems/helpful tips on my own, but I absolutely would never have figured out half of them without my friends in these groups. And certainly it would have taken me much, much longer.

We see it all the time — someone who is highly motivated, is actively doing deals, but is struggling. They’re wondering if they made the right choice; not because they think the business is not there, but because they don’t know what they’re doing wrong. Remember when you were in that position? Or maybe you’re there now, debating whether to throw in the towel and get a “real job?”

You’re in the right place. The opportunity is right in front of you. You simply need some help, some guidance, people whom you can develop a relationship with who are excited and willing to provide assistance. 

Work It

Most of all, don’t be afraid to ask. This is the most expensive mistake you can make. Most of us in this industry are more than happy to talk about ourselves, our successes, and especially we like to one-up each other for the biggest screw-ups (yes, it’s a sickness, we know!). There is a sort of weird bragging rights here, but at the same time, we don’t like to see someone else go through the pain we did.

So get involved. Join a group, or three. Participate. I can’t stress that enough — you have to be engaged and involved in the group. At first, you may be mostly on the receiving end of help and advice. But soon you will know more, and you will see someone else who is in a situation you already experienced, and then it’s your turn to earn bragging rights (even the apocalyptic kind). This is where you pay it forward. This is where you provide value.

And beyond all that, you can make some good friends, cohorts, compadres. We humans like to belong to groups with similar interests, and doing so helps you feel less alone in the world, especially when times get tough. 

In real estate, you can always count on someone else to have a story that begins with, “Oh yeah, well I can top that…” 

And sometimes that’s exactly what you need to hear.

The Importance of Flexibility

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October 23, 2020

The real estate market is currently a seller’s market. Inventory is low, and investors keep bumping into each other trying to get into the door of properties.

What if you could offer a seller more money than other investors, but make a larger profit on a wholesale transaction?

“Not possible,” you say. 

Except that it is, if you structure the transaction a little differently. And best of all, it’s legal and may be an even better option to help out the seller than a straight wholesale deal.

The problem many wholesalers run into these days is that sellers want a certain amount out of their property, but you know you can’t offer them that and have any hope at making a profit. So you leave, hoping they will call you later, or you may have never called them in the first place due to the situation.

What if you could offer them more money, or more time in the property, or other concessions they need and still get the property under contract?

It can be done using a Novation agreement. Essentially, a Novation allows you to control the property, market it for sale, and receive the profits upon sale without taking title. Think about the savings you gain simply by avoiding that first set of closing costs.

In a typical wholesale transaction, you buy the property (A to B), and all closing costs, commissions, taxes, title, etc. are paid. Then you sell the property to another buyer (B to C), again paying closing costs, commissions, taxes, title, etc. A Novation removes the first closing, changing the transaction to A to C, with you in control of the property. 

But how does this get around laws against excessive commissions, etc.? Because under a Novation, you take on all responsibilities of the seller:  You make any necessary repairs, you pay the mortgage, are liable for all the disclosures, etc. By assuming the responsibilities of the seller, you stand in the place of the seller, just without an expensive closing taking place.

So knowing you could save $5,000, $10,000 or more in closing costs, you can increase your offer to the seller above what other investors can offer. Not only that, you can sell the property on the MLS or privately instead of at a discount to a flipper or another wholesaler. So you can maximize the profits on the back end with a smaller front end investment.

We call this the Brewer Method, named for Eric Brewer, who has used this technique in hundreds of real estate transactions successfully. And we’re teaching it to you, complete with all the forms, sales techniques, and monthly training you could ask for. Visit www.BrewerMethod.com to sign up and take your business to a new level of advantages and productivity.

Do You Control Your Business, or Does Your Business Control You?

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October 19, 2020

I meet so many people in real estate who just want to do more deals — get more contracts, close more deals. If only they could do more deals, everything would be fine.

Sounds great in theory. 

Yes, more deals closing is the goal. As long as they’re good deals, because putting in hours and hours of work to make $100 isn’t worth your time. More GOOD deals closing, and that means the total costs involved from finding the deal through closing it. This is where you have to monitor the pulse of your business, know your numbers, budget your expenses — monitor your Key Performance Indicators (KPIs).

Most of us like the end numbers that can come out of real estate transactions. After all, making money is one of the reasons we’re in this industry.

But are you really making money? Or are you just robbing Peter to pay Paul?

As your business grows, it inevitably becomes more complicated. You hire employees, buy software, venture into different areas, add different types of transactions (e.g., wholesaling and flipping and rentals). You have more people wanting your attention, you are now more of a manager than doing the hands-on work, and you are being pulled in 20 directions at once.

This is where the momentum of building a business can overwhelm the solopreneur (the person who started a business). The road to becoming an entrepreneur has many forks in it, and a few roundabouts to get stuck in. This is where businesses grow, only to die on the vine.

You started this business knowing everything that was happening, and you made all the decisions. If something happened, or didn’t happen, all you had to do was look in the mirror to know who was responsible.

Now you may feel like you don’t have a choice in what decisions to make, almost as if someone else has set your company down a path and you’re racing to catch up. Things are happening, but you don’t know why, or you feel like you’re constantly putting out fires and slapping on Band-Aids to keep things moving. Despite your best efforts, despite all the things you try, you feel like this car is driving itself without a destination, as if you just go to work and triage whatever pops up that day.

Your business is running you. 

It’s difficult to admit, but the first step to solving the problem is recognizing and admitting that it exists. The good news is that you can take back control.

The first thing you have to do is know your numbers. Frankly, this can be the least enjoyable part of running a business for many, many solopreneurs and entrepreneurs alike. We like to do deals and get things done, not read reports. Knowing your KPIs is absolutely critical information to both survive and grow. Nothing will improve until you know your numbers.

Why? Can’t you just monitor the bank account? Or number of deals closed?

I wish it were that simple. As a business grows, so too do the opportunities to bleed money. Wasteful spending on employees, rent, marketing, software, supplies, bad deals, etc. can blow a hole in your bottom line. Your closing ratio, profit margins, employee payroll and expenses, all can work against your success if you aren’t setting standards, implementing policy and accountability, and keeping focus on the business’ goals and ideals. ANd it can sneak up on you slowly, silently — a little here, a little there, another cold caller, another database purchase, and suddenly your expenses doubled, which directly affects your bottom line.

This is where training can make a huge difference. There’s an old maxim, “You don’t know what you don’t know.” Take it quite literally:  If you don’t know how to manage employees or motivate them to perform to a certain standard, how would you know whether they are? How would they know? Who is taking responsibility and accountability for training them and then tracking it? 

Your KPIs will tell you. You can set standards of performance, goals for each person to achieve which measures their work. The numbers are tracked. For example, you may want your cold caller making 50 calls per day. Your acquisitions person may need to offer 10 contracts a week.

It’s one thing to set targets; quite another to properly train, motivate and encourage your team to achieve them. This is where investing in masterminds, investing in training programs, and becoming educated in specific areas can equip you with the tools and strategies to make your business boom. The right training also incorporates responsibility and accountability, for both you and your team. You don’t want to have to be standing over your employees to make sure they’re doing their jobs. You want them to want to do their jobs, be good at doing their jobs, and enjoy doing their jobs. And it is training that will enable you to solve the chronic issues which cause all the brush fires in your business, will help you close more transactions with less drama, and show you how to hire, train and keep the best employees.

Notice I said “invest” in masterminds and training. Yes, good training costs money. You’re a business owner, you know that valuable things aren’t free, and that quite often free things turn out to not be particularly valuable.

Investing in masterminds and training can enable you to exponentially grow your business far beyond what you paid. Can you figure it out on your own? Sure. All the information is out there. However, masterminds and training will both speed up your ascension to entrepreneurship and will relieve stress and frustration from not having good systems in place.

The real question is where are you going, and how fast do you want to get there? I can ride my bike across the country, but I’ll get there faster in my car, and much faster in an airplane. My bike is free (only I have to put in a lot of effort), the car costs money and it’s still a several day drive, and a jet airplane costs the most but I’m there in time for lunch.

Take back control of your business. Identify your weaknesses (those things you really don’t like to do and are giving you the most trouble), invest in masterminds and training, and apply what you learn. It may be tough at first, because you may need to replace some of your team who simply don’t want to get with the program. You may need to change the way you have always done things, and change can be difficult. You may even change the focus of your business, once you have thoroughly and honestly examined it.

In the end, change is hard, but change is necessary. When you think about it, isn’t growth simply change? A seed grows into a tree by changing, not by fighting to stay a seed. The difference is a seed knows how to become a tree. Your business does not.

Go learn how to grow. Go be a tree.