Digital Social Hour - Making $8M a Year, Losing Everything Due to Lawsuits & Becoming the Sales Goat | DSH #256

Episode Date: January 31, 2024

Eric Cline comes on the podcast to talk about the ups and downs of his life, how he nearly went bankrupt and how he became the sales goat. APPLY TO BE ON THE PODCAST: https://forms.gle/qXvENTeurx7Xn8Ci9 BUSINESS INQUIRIES/SPONSORS: [e-mail] SPONSORS: Opus Pro: https://www.opus.pro/?via=DSH Deposyt Payment Processing: https://www.deposyt.com/seankelly LISTEN ON: Apple Podcasts: https://podcasts.apple.com/us/podcast/digital-social-hour/id1676846015 Spotify: https://open.spotify.com/show/5Jn7LXarRlI8Hc0GtTn759 Sean Kelly Instagram: https://www.instagram.com/seanmikekelly/ Learn more about your ad choices. Visit megaphone.fm/adchoices Learn more about your ad choices. Visit podcastchoices.com/adchoices

After not sleeping for eight days, you start hallucinating pretty bad. SWAT teams came. I heard the SWAT team helicopters circling. The front door got busted open. The ambulance came down. I heard my mom out there screaming and yelling, saying he's dead. Leave him alone. On two, I heard one, two, and on three, I kicked the door open. And I was standing in the middle of the hallway in my underwear by myself.

None of it was really happening, but for me, it was the clearest sign. Wherever you guys are watching this show, I would truly appreciate it if you follow or subscribe. It helps a lot with the algorithm. It helps us get bigger and better guests and it helps us grow the team. Truly means a lot. Thank you guys for supporting. And here's the episode. Welcome back to the show, guys. Got a very special guest for you guys today, the sales goat, Eric Klein. How's it going? Going good, man. I appreciate you having me out here. Absolutely. So I got to know how you got this nickname, the sales goat. Yeah. So I've been, all my businesses have been virtually over the phone. And the reason is back 14 years when I got into sales, I was very insecure about the way I look.

I would, you know, I went down to South Florida to go, go to treatment, kick a problem. I got out. There was a, I was prior to that.

I was in construction. And when I started going for jobs everyone was denying me jobs I was trying to go into like just a normal job not in construction right I was getting denied because of all the tattoos I have got it so there was a guy that gave me a shot on the phones in a call center and for the last 14 years man I've just been ripping it over the phone because i was i didn't think people would buy from me the way i looked so i'm like if i can just hide behind a phone um and get good at that and i've been able to build a very successful career off of selling stuff over the phone amazing yeah and you still see success in 2023 over the phone massive Massive success. Really? Yeah. Massive success. Because I feel like people

are kind of more closed off, right? Yes and no, man. Like it happened and it kind of forced people to have to do stuff over the phone. Right. And it's one of those things I look at whatever you can do in person. I can scale quicker, faster, more efficient over the phones because I can reach more people and I can track my team's KPIs. That makes a lot of sense. Yeah. What products have you seen success with over the phone? So I've had multiple, I've done debt consolidation when I was working for somebody. Debt consolidation, credit repair, ADT, home alarms.

And then when I went out on my own for the first time ever starting to be an entrepreneur, I got into the timeshare exit space where I help people break timeshare contracts. Oh yeah. So I was in that space for about a decade. Um, started off in my bedroom, banging the phones with my wife. Yeah. And, uh, we ended up growing that in Fort Lauderdale, Florida. I ended up growing it to having over 150 people in my office. Yeah. We were doing all inbound traffic. I had a call center with a hundred, a hundred closers in it. And I'd run that thing from nine in the morning until two in the morning. Wow. And we, uh, in 18, 2018, I, I had built it finally up to, we were doing about 34 million. Damn a year. Yeah. A year. Holy crap.

Ran it at about a 40, I think it was a 43% profit margin. So you were making 10 million a year? Yeah. Oh my gosh. Yeah. I had a partner, but I had two partners. One of the partners was my wife though. Okay. So I mean, at the peak of it, her and I were netting about 8 million a year. Oh my gosh. Yeah. That's insane money. Yeah. Actually in Florida, no state tax. Yeah. It was crazy. So what'd you, what'd you spend it all on? So yeah, funny story. So from coming from absolutely nothing, because from 13 to 28, man, I was, I was heavily addicted to alcohol and at 28 years old, everyone says, how'd you get clean? And it was life or death.

There was no other option. I was either going to die, and it was very clear the path I was headed down. At 28, I was 135 pounds. I went on an eight day run and I was locked in my room for literally eight days. Just the dope man coming to the back door, serving me up what I needed. And after not sleeping for eight days, you start hallucinating pretty bad. Yeah. And I heard this is a long answer to your question, but, you know, SWAT teams came. I heard, this is a long answer to your question, but SWAT teams came. I heard the SWAT team helicopters circling.

The front door got busted open, and the ambulance came down. I heard my mom out there screaming and yelling, saying, he's dead, leave him alone. My brother was out there crying, trying to argue to get himself in the room. And the paramedics got everybody back and they said on three we're going to kick the door and go in and revive your son and uh on three on two i heard one two and on three i kicked the door open and i was standing in the middle of a hallway in my underwear by myself well none of it was really happening, but for me, it was the clearest sign.

You're either going to die, dude, or you need to get your shit together. So I say that to say at 28, that happened. At 30, I started my own business. I didn't know anything about money. I didn't know, like, prior to that, I couldn't pay my own cell phone bill. So me and my wife, when we started our business, it happened really fast for us. So I went from being a degenerate addict with eight bucks in my bank account to making millions of dollars. Within like two years. Quick. It happened very fast.

It was almost unreal to how fast it happened for us and uh so by the time uh it all happened when you say what you spend it on so real quick i'm living in a seven million dollar house in fort lauderdale i got a two million dollar house in chicago with two million million house in the keys and all the fancy cars. And, uh, in 2018, we were getting ready to exit the business. Uh, there was a private equity firm that, uh, we were under a letter letter of intent with an LOI. Uh, they were buying 51% of the business for $54 million. I was retaining 49% of it for a second sale. And 60 days before our sale was to go due and we were to close on that, I ended up getting sued by two of the

biggest time show developers in the world. Yeah. I can't say the names obviously because of my settlement, but I went from making a lot of money, recklessly spending in a way, to my revenue, my income completely getting shut off. Because you were only doing the timeshare offer at the time. I went all in on one thing. And so when your income gets shut off and you have everything me and my wife had like i panicked as a grown man yeah i had now i have a wife i have i have kids and i was like man what the heck am i gonna do right so we started selling everything off thank god my wife is had everything structured the way she did so we walked i ended up having to settle that lawsuit for millions of

dollars yeah man and it must have been super stressful too. It was two and a half years. Oh my, they dragged that on. Dragged it. That's what they want to do to whenever there's a big shark coming at you, they want it to drag on. It was the, it was wall. It was literally wall street taking out the little guy. Yeah. That's all it was. Cause at the end of the day, the timeshare model, they securitize that paper on the backend and then they would sell that paper off. Well, 65% of my business model was disrupting their paper. Wow. Yeah, no, I've seen it, man. My friend just got sued by Nike and they dragged it on for two, three years. Yeah. The worst part of all of that is my insurance company on the business. My business didn't cover my loss. Oh, why didn't they cover it?

I was, I was in a lawsuit with them too, because they didn't cover my loss. Oh, why didn't they cover it? I was, I was in a lawsuit with them too, because they wouldn't cover it. Um, so when I threw the towel in Sean, it was two and a half years in, it was three o'clock in the morning and I was stressed to the max, um, because my lawyers were telling me you can't do anything because we don't want them to tie in another business to this. So, uh, it was three in the morning. I woke my wife up and I'm like, honey, I don't care what these guys want. I'll, if we have to give them everything, start from scratch. I said, give me a year and a half and I'll get it all back for us. Wow. So you had to give up everything? No, we didn't. Yeah. We ended up walking. Thank God.

We ended up walking with millions of dollars, but it wasn't what we had. Right. You know what I mean? So it was still, uh, it was still stressful, but the reset for me was way different than when I very first started. Right. It wasn't as bad because you were at rock bottom before that. Yeah. Rock bottom. Yeah. So after that happened, did you find another offering? No, they, they said, uh, the private equity firm that we were under contract with, an LOI, they said, you beat the first lawsuit because we only had one at the time. He goes, we're going to stick with you and we'll actually acquire the company with one lawsuit. 30 days later, another lawsuit. And they're like, we're out. Yeah, Too risky for them. Yeah. Yeah. So what

did you start selling after the time to her stuff? Uh, took a, about a year and a half, just trying to figure out what I was going to do, man. Um, so you didn't work for a year and a half. I did, but it was just poking my head in different industries, seeing if it like, it would catch my attention and catch my, uh, really my heart. I believe if you believe in what you're doing, it makes it really easy to sell it. So for a year and a half, I was just kind of all over the place. And I remember telling my wife, like, man, I was really good at getting people out of timeshares. And I had to injunk myself from that industry.

I wasn't allowed back in it. And she's like, Eric, you weren't good at getting people out of timeshares. You were good at sales and marketing. She's like, at the end of the day, we owned a sales and marketing company. Right. And a fulfillment. So I ended up two and a half years ago jumping into the wholesaling real estate space. Wholesaling real estate contracts.

So I've been doing that for two and a half years. And literally first 12 months, never knew anything about it. Never heard of the industry. Someone was like, Hey, this model was very similar to what you were doing. I hear you talking about what you used to do. You should try this one. And, uh, from the first call I made 12 months later, I did 2.6 million and ran it at a 58% profit margin. Whoa. Just by yourself. I had two closers with me. Damn. Yeah, man. That's amazing. And your first year, first 12 months. So you're just great at sales basically. Virtual selling. Yeah. I, again, I do it over the phone. If

I were to try and sell you something like this, I get uncomfortable. I love having a phone to my ear. Usually it's the other way around. I feel like. People are better in person, right? Yeah. It's just how I started and how I did my career for 14 years. So what are some common mistakes you see people make on the phone that you think it kind of ruins the deal? One, they forget, like, in person, you lose probably 90% of it. Like, when I see you you i can see everything about you

good looking dude you got yourself put together the way you're sitting paying attention to me looking in the face well they forget all that right that you don't have that over the phone the really that what we have is our voice the tonality of it the voice fluctuations, the pauses. And they, so I have like, I have this five-step dummy-proofed process, sales process for virtually selling. That's something I'm, in the wholesale space, like I've branded myself as the virtual sales goat. And I would say the most common mistake is they,

when you call somebody over the phone, you have to get them engaged immediately. Right. Because we don't know what they're doing on the other side of the phone. They could be washing their car. They could be playing with their kids. And you want to get their full attention. So I'm a firm believer in the very beginning, within the first minute, minute and a half, you got to get them

somehow engaged doing something you're asking them to do. So on all of our calls, when we call somebody within like the first 30 seconds to a minute, we're having them grab a pen and paper, jotting all of our information down. So we know we're now in control of that call. Love it. That's smart. Yeah. Cause at the end no matter what you're selling you're going to be asking for an order whether you're asking them for money or whatever it is you're selling and if they have your name down the name of your company your telephone number all that last thing you want at the end of a call is for someone to say and what's

your name again because there's now they don't they don't have a clue who they're even buying yeah that's a bad sign so it's it's something so many people overlook but over the phone it's it's so crucial man and are you following a script or are you winging each call yeah so in my industry uh i have i'm now notorious for my 11 page script. Oh, 11 pages, 11 pages. That's a long script. Yeah. So I've literally in the wholesale industry, I have scripted this thing out. If you can read and you have my script, you can have success in this industry. Wow. Yeah. That easy. I swear to you, my script has changed the game in this space. Oh my gosh. So like, what can someone make if they start doing this? I mean, I got a girl, a lady I worked with in Chicago. She was an IT. She had a full-time IT job doing 140,000 a year. Last year, she was dabbling in wholesaling. She did 70,000 doing

it part-time. Nice. And then she came to me and she's like, hey, can you help me? And I was like, what's your goal? And she goes, I want to match what I did or I want to double what I did last year. So she wanted to do 140,000. And I was like, all right, well, my goal for you is to be able to, you quit your job and not double but triple what you did and in in two in 12 weeks uh she made uh eighty five thousand dollars whoa that's insane how many people a day was she calling uh not not allowed at all yeah when when she even told me she's like eric you would be so upset because i'm barely working doing this she's like i'm like'm, I'm creating a lifestyle

around it. Wow. Which is great, man. It's virtual. You can do it from wherever you want. That's impressive. Yeah, man. So you're basically matching buyers of homes to sellers with wholesale, right? Are you interested in coming on the digital social hour podcast as a guest? We'll click the application link below in the description of this video. We are always looking for cool stories, cool entrepreneurs to talk to you about business and life. Click the application link below and here's the episode guys. Yeah. So we go, I'm in five, I'm in six States, North Carolina, Florida, Georgia, Tennessee, Indiana, Ohio, um, might be one more. So I, I own a call center overseas that we generate. They do all the heavy lifting. I send them bulk data. They call people and they say, are you interested in selling

your... So a qualified lead to me is if they say they'll sell their house in 12 months or six months or less, and they say they're open to hearing an offer, I want my team to speak to that person. There's more criterias, but that's the gist of it. So we get anywhere between 40 to 50 leads a day from the call center, plus I run some PPC ads. And then every 21 leads, we get a contract. Wow. So you're closing two a day then? 2.6 deals a day. Amazing. And how are you finding the buyers?

So my partner in the business, he does all the dispositions. So we leverage the MLS a lot. There's something called the flat fee MLS where you don't have to be a realtor or anything like that. You can go through a company, it's called BrokerList, and we are able to list our properties on the flat fee MLS. And it just casts in a wide net of people looking for whether it's an investment property or they want to move into it with their family. Yeah. Wow. So you're basically middlemanning a real estate deal. 100%. Unless we can steal a property, we don't buy it. Yeah. That makes sense. And what range are you typically aiming for, like value of the house? Great question. So our model, Sean, is I buy all absentee owner data, meaning every contract that we do, the homeowner actually doesn't live in the

house. Okay. So they have maybe a vacant home or they got tenants living in it. Got it. Because right now I like when I came into this industry, I was like, what's the lowest hanging fruit? I want to I want to go after a home where I don't have to kick a family out. It's a landlord that wants to kick a tenant out that more than likely isn't paying him what he should be getting in rent. Right. So in my head, I'm like, that's the lowest hanging fruit. And so we buy absentee owner data. The value of the home, we always keep under 300 grand. And then we want the owner to have 20 to a hundred percent equity in the house. And then we only target landlords where they put the, their rental property and their personal name. And it's not in an LLC because if a, if a landlord has a home in their personal name, they're inexperienced. They don't know if something

happens at that house, they're liable. What do you mean? Like a lawsuit? A lawsuit. Right. So we're targeting all these. So when, when I call, when my team calls a lead, the, the, the person we're calling doesn't know everything that we know about them. Like they don't know we're going into this call thinking you just spent three to five minutes with a cold call company in another country and you know, answering questions about your house. I know you got at least 20% equity. I know you won't, you don't live in the house and I know more than likely you got a tenant in there that's paying you below market rent. That's pretty good ammunition going into a phone call. Yeah. You know a lot on, yeah. I like this this model a lot because it seems kind of recession proof too. I think it is. Everyone, when the market was correcting itself in this industry that I'm in, they got spooked. What I did was I broke the lease on a 2000 square foot office,

moved into a 6,000 square foot office and tripled my team. Yeah. Because it's just brokering deals. So no matter the price, it doesn't really matter as much. Yeah. And we're trying to buy homes. So like when we buy houses, we want to try to get them when we make offers on houses, we want to get them typically 70, 70% or lower of the market value. Wow. That makes sense. Cause if you're getting at a 20, 30% discount, then you're, then there's a buffer to go and sell it to somebody. Right. You can make the difference. Basically our average, our average assign, they call it an assignment fee. When you assign the contract, our, since I've been doing this for two and a half years, our average assignment fee is 22 grand. Wow. That's a really high average order value. Not bad not bad at all and you're doing 2.6 a day so

you must be doing over 10 mil a year so there's we have about a 45 cancellation rate right now on our contract to close okay this my first 12 months i did 2.6 this year we're going to end right at probably 4 million okay we run it at like a 50% profit margin. It was 58 last year, obviously, as we scaled that profit margin as it went down. Our goal was 4 million and we hit it. We should hit it this year. Nice. And then next year, we want to try and bump it up again, 2 million. So we want to do 6 million next year.

Nice. So do you think you could scale this to the numbers that the timeshare business was doing? Good question. I don't know if I want to, man. You're good at this level. Yeah. Cause I, my brand within this industry, I offer, I have my own proprietary software, CRM that I licensed out to this industry. I have my call center that, uh, anybody that wants to duplicate what I've done in the short period of time, they want to use what I've, what I use period of time. They want to use what I use. So I have a call center in Pakistan.

I got over 100 cold callers in an office. So I let people buy my cold callers. And then I offer sales coaching for the industry. So it's like I'm good having multiple. You got other revenue streams. Yeah, yeah. I'm good having multiple. You got other revenue streams. Yeah. Yeah. Going,

if this, the wholesale model could do 6 million a year and run it at a decent profit margin. My team's eating as well. Like I'm, I'm good with that. Cool. It's good that you found that level of comfort where it sounds like when you were making the 10 mil earlier,

you were super stressed, right? Well, this is it actually on year. So of that last model on year, year nine, I was making less money than year seven. So when we were scaling the numbers crossed at some point where I was, we were working much harder, me, my wife and our partner to make less money the liability all the the team members and the exposure in the industry we got so big um and we were making less last year

and a half of that business we were making less than year seven that's the scary part about hiring because you never know when that point that tipping point is right yeah where you're making less and you're working twice as hard and it was our it was my first go around ever you know owning my own business and the way it took off like i said man it was it was crazy like i it it happened very fast i didn't even know you could sell businesses i was that naive where uh my buddy he's my dear friend today now but he was getting us a mortgage on that house and he was like bro what do you do i was like i help you people get out of timeshares and he started looking at our financials and he goes have you ever thought about selling this business and

i'm like what are you talking about i didn't know you could sell businesses yeah so he's the one that kind of put everything together and got us to where we could yeah it was crazy no one really teaches that i mean i didn't know i didn't. Yeah, it was crazy. No one really teaches that. I mean, I didn't know. I didn't know either. Yeah, it's crazy. Super important to be able to build your business with the idea of selling because you need a lot of stuff in order to be able to do that.

Of course. Yeah. Sounds like your wife has played a major role in your success. She's my rock, bro. Yeah, that's how I feel about my fiance. How did you guys meet and build this relationship together? Yeah. So she's my day one.

I left Chicago because I'm from Chicago. as me and, you know, build this relationship together. Yeah. So she's my day one. I, uh, I left Chicago cause I'm, I'm from Chicago and, uh, I left there to go to a treatment center. Um, literally had eight bucks in my name, flew down to someone, put me on a plane to go down to Fort Lauderdale to check me into a treatment center. Why'd you go all the way there to go? They flew me there. I didn't, at this point I was, people were telling me you need to do this and I was doing it. Okay. You know what I mean? So, um, it was out of my, I just was going to do anything anyone said so I could get away from where I was at. And, uh, he put me on a plane. I had, when I flew down to, uh, Fort Lauderdale, I literally had two white Hanes T-shirts and two pairs of shorts.

And I had eight bucks. And I went into a treatment center. And I was there for 60 days. Wow. And they would put us on this white, they would all put us in this white van. And they'd cart us to these NA meetings, Narcotics Anonymous. And I was in an all-male facility. And they would bring us out to these meetings, Narcotics Anonymous. And for, I was in an all male facility and they would bring us out to these meetings and there was, there was girls there. And it, for us,

it was like a treat, you know what I mean? Being locked up with a bunch of men. And, uh, the last three days before I got out of treatment, uh, my, my now wife would come to these meetings and I'm like, damn dude, it's a hot chick. Like full transparency, I thought she was lesbian because she had her best friend with her. And I was like, I don't know what's going on with these two. But, uh, we exchanged, she wasn't a lesbian and then, uh, nothing wrong with lesbians. And, um, so three days before I got out, we exchanged phone numbers. And when I got out of the day, I got out of treatment. She picked me up and brought me to a Starbucks. And I spent the last eight bucks I had on our first day. Wow. And she we've we've literally been together since the day I got

out of treatment. That's crazy. And it's been over 14. It's been 14 years. So you were dating long distance at first. No, she lived in Fort Lauderdale. But you were in Chicago, I thought. No, I flew to Fort Lauderdale to go to treatment. When I was in treatment, they would bring us to these meetings. So I was in Fort Lauderdale.

Got it. I had intentions, Sean, of going to Fort Lauderdale, going to treatment, after that, going back to Chicago. Got it. I was a union carpenter in Chicago. Yeah. And so for me, it was, I'm going to go down there, get my stuff together, get clean, and then I'll go back,

and I'll live back in Chicago, and I'll build high-rises. But when I, right before I got out of treatment, a suggestion was you should probably go to a halfway house down here and live in structured living. So I did that for six or seven months. But Shiloh's her name. Dude, she's been my rock, man. I always tell everybody, like, I've never had somebody that really said,

hey, I believe in you. You can do this. You can do that. You can do this. And, do that. You can do this. And, man, she's my biggest cheerleader. She tells me so much. She believes in me. And you're going to change the world.

When you got someone like that in your corner, dude, it's hard not. Yeah. I always tell guys, like, you can't beat a good girl by your side, man. No. They just protect you spiritually. Everything. Like, they're great they are they you know that behind every good behind every good man's a good woman it's like man she's right beside me we've been business partners since we the day we started our business together we've been in business like she's my ride or die she's the

backbone of every business we've been man she's really been there from day one for you rock bottom day one that's how you know she's a real one day one dude yeah that's awesome to see man yeah um and you're able to mix business and personal with her which is you know now don't get me wrong there have been times like there right we've been married and business partners so we're husband and wife and business partners so i would say the last this model that we're doing now the wholesaling industry and me building my brand she loves the fact that she can help build my brand she believes in my brand like i'm the reason i'm doing the brand or she is the reason i'm doing it because she's like

eric you have something you have something you have something you know you got to get this out there so she believed in it before I did um and it has allowed her to like be involved in something she truly loves to do she loves being involved with my brand right like absolutely loves it um but there have been conversations though where it was rough it's inevitable when you mix the two there's always going to be some yeah sort of argument you know yeah but we have found right now we are in such a good place and we both say it we're both doing 75 hard together right now every single morning we're getting up at 5 30 we go on a 45 minute walk together, you know, and we're talking it's it's it's life's good. Beautiful. Yeah. Those walks, man, especially when you don't bring your phone, something feels good about being in nature.

It's amazing. Yeah. Eric, your story is super inspiring, man. Great episode. Anything you want to close off with or promote? No, man, I appreciate you having me out here. I mean, if anybody, I will say this, if If anybody needs virtual assistance for generating leads in the wholesaling space or the solar space, hit me up. I can give you trained callers by me. And if you struggle closing deals over the phone, I am your guy. They call me the virtual sales go for a reason. Let's go. Thanks so much for coming on, man.

Yeah. Appreciate it, brother. Yeah. Thanks for watching, guys. See you tomorrow.