Epic Real Estate Investing - 3 Ideas to Impact Your Bottom Line in 2015 | Episode 136

Episode Date: December 15, 2014

Matt just got back from his quarterly real estate investment mastermind group, and he’s picked the best ideas he got for his own business to share with you!  ------- The free course is new and improved!  To access to the two fastest and easiest strategies to a paycheck in real estate, go to FreeRealEstateInvestingCourse.com or text “FreeCourse” to 55678. What interests you most? E ducation P roperties I ncome C oaching Learn more about your ad choices. Visit megaphone.fm/adchoices

Does your money work for you as hard as you do for it? If not, no worries. You do not have a money problem. You merely have an idea problem. We're cashflow savvy.com, and we'd like to share a new idea with you around income real estate that can transform your financial future and accelerate its arrival. Go to cashflowsavvy.com and download a free investors package.

Cashflow savvy.com. You do not have a money problem. Merely an idea problem. Cashflowsavvy.com. More ideas, less worries. Cashflow savvy.com. Podcasting from Terrio Studios in Glendale, California, it's time for Epic Real Estate Investing with Matt Terrio. Yeah.

Hello. Hello, and welcome to episode 136 of the Epic Real Estate Investing podcast, the place where I show people how to escape the rat race using real estate. And I just got back last week or from last week from my quarterly mastermind meeting, the mastermind group that I belong to. And I came back, as I always do with a wealth of information and way too many ideas. I mean, literally a to-do list of 56 items, a little bit overwhelmed, actually, but actually very excited as well. And on the plane, on the plane ride home, I narrowed my list down to just those things that serve my goals for 2015. You know, the constant and recurring message at my mastermind group is,

and these two things should be running through your head constantly as well. The first thing is, how can I make more money by doing less? That's a biggie. The second is focus on becoming exceptional at one or two things rather than what most of us do. you know, we go out there and we become mediocre at a bunch of things. So those are the two ideas that are always running through my head. And I wanted to share with you my three biggest takeaways from my group that will significantly impact my business. And they're going to support all three of my major goals.

And, you know, they can do the exact same for yours. I mean, I think these are universal things that I'm going to be focused on. And we'll do that in 30 seconds right after this. Sales pitch? Sales pitch? We don't need no stinking sales pitch. Here's the ball busting truth. You can make excuses or you can make money, but you can't do both.

Get the new free book, Epic Freedom, the two easiest and fastest strategies to a paycheck in real estate. You heard right. No sales pitch, it's free. Go to free epicbook.com. No more excuses, just real world strategies to making real money in real estate. Free epicbook.com. Free epicbook.com. So a little bit about my mastermind group.

You know, with owning 240 plus rental units that I own and averaging six to 10 deals per month, whether those are wholesale or fix and flips, I'm a very, very small fish in this big pond, this mastermind group pond that I belong to. I mean, this last week I was thinking of all this was very funny. I was thinking of all the people that have told me over the years, whether it was to my face or via a Facebook post or a tweet or an iTunes review, that what I do, primarily doing deals with no money or credit, it can't be done. And, you know, many of those naysayers have taken it to a whole other level by downright calling me dirty, nasty names. And I was thinking about all of those people that I've encountered over the years, not a ton of them, but, you know, when you do encounter them, their message or what they have to say tends to resonate and it sticks around for a while. And so they're unforgettable.

This is what I'm trying to say. So of all those people that I've encountered over the years and wondered what they would think, if they were sitting in that room with me right then and there, what would they be thinking then? I mean, let's see, this was our year-end meeting. So all three portions of our group were all in one meeting. So that was a hundred of us, a hundred very successful real estate investors all in one meeting. And the types of conversations that can go on in there, I mean, can be and often are downright mind blowing.

I mean, it's amazing the intellect, the collective intellect that's involved there. It's just, I mean, gosh, you'd think they could solve world peace. That's how smart some of these people are. And a lot of times these conversations are actually very much over my head. I mean, they've got an understanding of the dynamics of world economics and finances and money and Wall Street and how that impacts their real estate business. and, you know, what they talk about sometimes it very much can make an accomplished person like myself

look like a total newbie. And sometimes I very much feel like that. Sometimes I feel very inadequate there. I mean, there are members of this group that own thousands of rental properties. There are members that flip hundreds and hundreds of properties a year and members that wholesale thousands. And believe it or not, at this level,

they are hardly using any of their own money either. And I was just thinking about those people that think I'm crazy for doing what I do or I'm lying about what I do with no money or no credit. And I'm just like, you ain't seen nothing. I mean, these are hundreds and thousands of properties being flipped and rehabbed and wholesaled all with using none of their own money. And so anyway, I just like to keep my experiences there. I like to keep them pretty close to the vest because most that have never experienced such a thing or have never witnessed it or have never pressed the full. flesh of someone that's actually doing that on a daily basis, let alone a hundred people all in one room that do it on a daily basis. You know, they'd think I was in complete la-la land,

total fantasy land. But, but indeed, it's 100% reality. And it's why I pay a very hefty fee each year to belong. Because, you know, if for nothing else, and this is why I always recommend, you know, you go to Rhea groups and you network with like-minded people. You know, if nothing else just to surround yourself with evidence that what you want to do is attainable by just ordinary everyday people that you can look to right in the eye. And specifically with this group, I mean, it's evidence that mega wealth through real estate is attainable by everyday average ordinary people. I mean, there are people there in that group that look like they shop at J.C. Penny or they got, there are coals or I know Mervynes isn't around, but

that's kind of what I was thinking. You get the picture is that they just look like everyday people. I mean, there's a guy in there wears a member's only jacket that every time I've seen him. And he's got a thousand properties, a thousand rentals. He can't even keep track anymore, but he knows it's over a thousand. You know, and additionally, what I like about the group is the ideas that come out of a group like that. They're absolutely brilliant. And a lot of times, their ideas that no single person might have come up with on their own.

But when you get a few throwing ideas back and forth, it evolves and it morphs into something so much. bigger. And so that's always amazing part to be a part of. And I've been able to incorporate quite a few of those ideas this past year that absolutely has impacted my bottom line. But mostly what I get out of being a member of a mastermind group are the relationships.

I mean, having the ability at any moment to pick up the phone and call who's not only experienced the challenges that I have or that I am experiencing, but pushed through. And they persevered. And they absolutely crushed it. And they

continue to crush it. That type of access cannot be underestimated. I mean, there's just no substitute in business to that type of access. And, you know, with all that said, you also are constantly reminded that there are no secrets, there are no tricks, there's no magic, there are no silver bullets, there's no fairy dust, nothing like that that someone could just wave over their business and instantly be a success. You know, the basics at my level, the basics at your level, they're being practice and implemented at that highest echelon as well. And I think we all need to be reminded of that now and then. I mean, we just did this last November, we went over to the Back to the Basics series.

And I mean, even when you think you understand it and you understand the importance of the basics and that, you know, the logic right there is ringing true in your head and you just know it. Sometimes you don't really get it until you sit down face to face with someone who's uber successful at doing the exact same thing that you do and you discover that they're doing the exact same that thing that you do. They're just doing more of it. They're doing it on a bigger level, but it's the exact same thing. And, you know, that hit me a few times this past week.

And I came home absolutely committed to refocusing on three areas of my business that will, without a doubt, positively impact my bottom line and without a doubt impact yours as well. if you implement them. Okay? That's the thing. So number one, the one thing I came back committed to implementing or placing a new level of importance on

are tracking our numbers. You know, the more successful that I've become, the less that I've done this. I mean, I absolutely insist that every one of my coaching clients do this, track their numbers. And the numbers they track are, you know, their marketing numbers,

the leads that their marketing generates, the number of leads they talk to, the number of appointments that they set, the number of offers that they write, the number of offers that get accepted, and, you know, the number of offers that close and all of that. And then the amount of the profit they make each time they do close a deal. And I absolutely insist that every one of my coaching clients track their numbers. Because it's so important for me to know their numbers so I can appropriately coach them. You know, everyone's numbers are different, therefore everyone's coaching is different. The conversations I have after that first phone call that we always have, from that point

forward, no two conversations are alike. And so it's very tailored and structured, but I can't have those conversations with them and have it really impact them unless I know their numbers. You know, and plus also the other reason I have them, I insist on them tracking the numbers is after several years of coaching, really, without one exception, those that track their numbers succeed. In fact, without exception, those that track the numbers succeed. And those that don't, don't.

There I could probably think of an exception or two that didn't track their numbers and still succeeded. But what I do know without exception is those that do track their numbers always succeed. I mean, there is a direct proportion to number tracking and one's success. And I knew this early on. And I always tracked my numbers, always. I learned from someone that was a number. very good at this and they were able to demonstrate the importance of it very clearly defined by dollars and you know so I embraced it and I did it and because I did I was successful at rather

quickly and and but when I got to a point where my business just kind of seemed to happen like I kind of you know become was starting to come become more and more second nature I slacked off of tracking my numbers I just stopped feeling the need to and besides it's it is a bit tedious I mean If you've ever done it, it's some effort. And sometimes it doesn't feel it's actually necessary to document it. As long as you know you're doing it, you don't really need to write it down. That rationalization comes through your head. But it is necessary.

I mean, I haven't felt the need to do it for so long. But if I want to be a bigger fish in my mastermind pond, I need to track my numbers. There's a saying that that which gets measured gets bigger. that which gets measured improves. Okay, so I need to track my numbers. And there are three primary reasons that I need to do this. And I want you to take note of this for your own business. The first reason, I'll know exactly where I stand in my business at all times.

I'll have 100% clarity on where I'm going and when I should expect to get there. Second reason is I'll know exactly, you know, if I'm hitting my goals, I'll know why. and if I'm not hitting my goals, I will also know why. So it essentially gives me the ability to coach myself in the same way that I coach my students. I just look at the numbers and boom, that's where I need my help. That's where I need to improve or that's where it's going really good. Let's do more of that and less of this and whatever it may be. But you can't do that unless you actually know your numbers,

not with any sort of real accuracy and consistent accuracy at that. And I mean, you'll finally understand the question. correlation between marketing leads and the money that you make. Now, the third thing would be that I'm getting bigger and my goals are getting bigger. I've got a team now in place. I've got one, two, three, four people that work right here. Five. Hold on, one, two, three, four, five.

I got five people other than myself. So there's six of us that work here in the office. And by tracking our numbers and reporting our numbers and makes the entire organization more efficient, more productive. you know when each team member has to report on specific numbers, the, the productivity, it seems to increase because they're measuring it. And because they're measuring it, it improves. They're measuring it and it grows.

So it's so important. So I will be tracking all my numbers in my business in 2015, starting today, effective immediately. Okay? We're going to know every single piece of marketing material that goes out, the exact number. We're going to know how many calls are received. We're going to know how many appointments. are set, how many offers are written, how many deals closed, and how much profit we made per deal. Okay, so that's number one.

Number two, reducing your big goals down to a small daily goal. And this was, shoot, I teach this over on the do-over podcast. I just sometimes, you know, when you can't, you're so into your business, you can't stand back and look at yourself from the outside end. and it's just so foggy on the inside. So this is a really biggie. It's something I already knew. It's just something I was failing to do.

And that's kind of how it is with everything, right? We all know what to do. It's just doing what we know is where we break down. So I looked at my income goal. I have an income goal of $5 million next year. And I want to generate that $5 million through wholesaling and flipping properties. I'll make more money on top of that. But I wanted to really scale this part of my business.

And then I'm going to take that $5 million, the majority of that $5 million will go right into increasing my buy-and-hold portfolio and, you know, moving me further along even further out of the rat race. So that's what that intent is. But to get there where I average about, you know, probably about $15,000 per deal, we get about $10,000 when we wholesale, about $20,000 when we fix and flips. Certainly there's a home run in there every once in a while, but I just want to base it on average and be very conservative. So on average about 15 grand per deal, that amounts to 334 deals this coming year to hit our $5 million number. Okay. So that's almost triple, I guess, what we did this year.

Almost triple. Just a little less, I guess, than triple. So take the 334, divide that by 12. That's 28 deals per month. Okay, so that's what I'm going to focus on, just 28 deals. deals per month. We're going to take our mind off the $5 million. We're going to focus on the 28 deals per month, but we're going to reduce it and make it even smaller. So if we convert every 30 calls or so into a deal, so that makes 28 deals times 30 calls. That means that's 840 people that we

have to speak to on a monthly basis. So my acquisition manager, David, we're going to reduce that even further. We take those 840 leads and we divide it by 30 and gives us about 70 people a day, 70 leads per day that David has to talk to. Now, if you've ever been on the phone for any length or handled any sort of call volume, you know that's a big, long day. That's a huge number. So what we did is we put a filtering system in place, and we hired a real estate virtual assistant to speak to those 70 leads per day and just kind of filter them out and help David

along with that. And so David will only have to talk to the most motivated of those leads. So for me to hit that goal, I have to generate for David and his VA. 70 leads per day. That's my daily focus. I take my mind completely off the $5 million for the end of the year and just focus on the 70 leads per day. So when I'm looking at that, I can just back out of that.

At an average response rate, I don't know, about 12%, combined with letters and postcards in our direct mail. I have to average 584 pieces of mail to go out every day. But, you know, I won't be sending those out every day. So it's going to be more like twice a month. So that's, let me see if this number is right. So that's 17,500, pulling out my calculator, 17,500 pieces of mail per month.

Let's go 584 times 30. Yep, 17,520. So that's how many mailing pieces per month. So basically 8,750 on the first will go out. 8,750 on the 15th of each month will go out. And like I said, that's a little over triple that we're currently sending. So I'm not going to go out right now and send all in triple our mailing volume. I want to work my way up to it.

I want to take us slowly to make sure that we can handle the demand and handle the call volume. And by the end of the year, this will all even out because we'll likely be sending 25,000, maybe even 30,000 pieces out per month. And that sounds very overwhelming to me right now. That sounds almost unbelievable. That'll be more than I've ever done in my life. But this can all be delegated. And it's just math. but if that's the income that I want,

then that's what it's going to take to average 70 leads per day. So that's my focus, is 70 leads per day, reducing this giant goal of $5 million for the year, wholesaling and fixing flipping properties, reducing that down to just, I'm just going to come in every single day

and how do I generate 70 more leads today so David and his VA can speak to. Okay? So that's the second thing. Now, the third thing I'm going to be looking at in my business is really where the, it's one of the big, it's not the secret, but it was kind of an aha moment of something I recognize right away. We're not doing this.

It's really where these big dogs, where the fortune is made. It's where the big money is made. And we're not doing this nearly as good as we could be. And I'm going to share that with you in 30 seconds right after this. Have you ever wondered how some investors seem to get the inside scoop and snatch up all the deals? Wonder no more.

The secret to, finding deeply discounted properties has been exposed, and it lies within your ability to find motivated sellers. Go to find motivated sellers ASAP.com and download their proven five-step checklist to find motivated sellers in any market. Find motivated sellers ASAP.com. Deeper discounts, less secrets. Find motivated sellers ASAP.com. All right, so the fortune, where is the fortune made? Well, you may have heard of this before. The fortune is in the... Can you fill in the blank?

The fortune is in the follow-up. And you've probably heard that before, right? And it's not just some fancy little cliche. It's actually holds a whole lot of truth. But, you know, and we all probably know that. We've heard that in different contexts, depending on what job that you've had, any sort of sales job, that's frequently uttered.

But to know and not do, like we've said, is to not know. Okay, thank you. for those ancient Chinese proverbs. They're so compelling and powerful. To know and not do is to not know. And so I do know that, but we're not doing that. And we're not doing it as well as we like.

So maybe we don't know as good as much as we think. So, you know, time after time, I hear these Uber successful real estate investors share their systems, and some of them are brilliant, and a lot of them have been able to really remove a significant portion of their own time out of their business. And so as they share their systems, and since they track their numbers,

they've all agreed. It's pretty universal across the board that the average person that they purchase a property from doesn't sell to them until somewhere between the sixth and eighth touch. That means whether it's a phone call, a postcard, a text message,

a voicemail broadcast, whatever it may be six to eight times they've got to reach out to that person to make that contact before that property actually gets sold to them. So yeah, of course. course, this is where the fortune is. It's in the follow-up. That's where this comes from. It's going to take six to eight times touching that prospect before it actually results into

a transaction. So we do follow-up here, and we follow up a lot. We do that quite a bit. So I can attest to what my friends are saying. I know follow-up works, but we don't have a real follow-up system in place to not one good enough to really limit or even possibly eliminate the numbers that fall through the cracks. I don't know if you'll ever get to eliminate everybody that fall through the cracks, but you can certainly clog that hole up pretty significantly with the good system. So I kind of, I borrowed their system. I took one of the persons and actually two of them and I kind of combined them. So I put the system in place and we have this in place within 48 hours of our arrival back home. That's how important it is. So this is the follow-up system. Every call

that comes in gets categorized as a seller. Okay, that's how they drop into the, to the database. And we just put that into place as well. We're now using. podium. And there's a little bit of learning curve, but we're moving along right away. So they get categorized as a seller. And then every seller that we speak to gets an offer. Every seller we speak to gets an offer. And if they accept the offer, obviously, we buy the property. If they don't, they get assigned a follow-up sequence, a sequence that happens automatically. And we're going to build on this, but this is the foundation that we put. This is what we got right now in place. So every month, they will receive a piece of mail. Okay, it could be

a postcard, could be a letter, could be, could be anything. It's going to be a piece of mail. They're going to get touched through their mailbox. A second thing that they're going to get every month is a text message. And they're going to get out a text message that goes to their mobile device. Third thing is they're going to get a voice message broadcast. Now, I get a lot of those calls that, you know, you've got this automated person. You can tell it's a recording and they call and they try to sell you something and, you know, we get those all the time. But there's several broadcast services out there right now that actually bypass the

person altogether and it goes straight to their voicemail. It's very cool. And I just don't want to share that with you. But the name escapes me right now. But I will. I promise. I will. And an email.

Then every month they get an email and every three months they will receive a phone call from a live person. So that's how it works. Every month they get a piece of mail, a text message, and a voice broadcast, and an email. And then every three months, they will receive a phone call from a live person. I mean, shoot, that right there, just that right there might achieve my $5 million goal for the year all by itself. So needless to say, I'm very excited about that. So that's how my mastermind group contributed to my plans for this coming year. like I said, I had a list of 52.

That's not an exaggeration. That is an accurate number. I'm looking at the list right now. But I've kind of focused on those three because those three, I think will impact my goal more than the other, that would be what, than the other 49 options. Okay. So that's how they, the mastermind group contributed to me. First, we'll be tracking all of our numbers.

We'll be tracking the marketing leads, the offers, and the money made per deal. The second thing will be, take our focus off of the big number, the $5 million. and solely focus on a basic daily goal of just generating 70 leads per day. Okay, so that's what we're looking at. And the third thing is the follow-up. That's where the fortune is. And I've already got that system in place. So there's nothing for me to do except wait now.

I mean, certainly I'll check in on it from now and then and to make sure everything is working, but the system is in place. And every lead will get followed up on with or without my personal involvement. Okay, so it's how we're going to be able to handle a very large, volume of marketing and a large volume of lead generation. You know, in the very near future, I'm going to circle back around to what I've just covered, each one of these in detail.

I'm going to answer all of the questions around how. I'm going to answer all the questions around and what, what we're using, what we've done. Some of the stuff is rather new to us. I want to make sure that I have it down and it's implemented and it's incorporated and it's working smoothly before I share that really with you because we are modifying and making some changes to our business. and everything that we've done up to this point is absolutely worked. Okay, we've done very well for ourselves,

and everyone that works with us have done well for themselves, but we can do better. We've got bigger goals. So, you know, it can show you how to make a million, two million bucks, but, you know, what it takes to get to $5 million, that's, I've never done it before. So this year we're going to do it, and these are the changes that we're making.

All right? So I will share all of that with you. I'm thinking less than 45 days from now. I'll circle back around, and I'll report back to you on this, and I'll break down the details of each one of these on their own individual show. So you can duplicate what we do.

You can rip it off from us and use it in your market. All righty. So I got a lot of live events on the calendar all over the country. So go to grub and grow rich.com to see when and where we're coming to your town. I would love to meet you.

I really would. I want to know who you are. I want to know what makes you tick. And I personally want to thank you for listening to and supporting this show. All righty. Go to grub and grow rich.com. and let's meet.

Okay, that's it for today. I'll see you this Thursday for another compelling episode of Third Degree Thursday. I'm Matt Terrio, living the dream. You've been listening to Epic Real Estate Investing, the world's foremost authority on separating the facts from the BS in real estate investing education. If you enjoyed this show, please take a minute to visit iTunes and share your thoughts. Thanks for listening. We'll see you next time here at Epic Real Estate Investing with Matt Terrio.

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