The Science of Flipping - Episode 173: Top Executive Quits Job and Gets First Deal $12k

Episode Date: November 13, 2020

Ever wondered what it would be like to be a top executive and quit your job in order to be a real estate investor? I'm excited to have my good friend on to talk about how he made $12k off his first deal coming out of a top executive position!

Welcome to the Science of Flipping podcast. I'm your host, Justin Colby. Justin Colby. All right, guys, welcome back to another episode of the Science of Flipping. I am your host, Justin Colby, and this podcast is all about your systems, your strategies, your tools to be an incredible real estate investor. And today I actually have a great special guest with me. I have a longtime student and a now very successful real estate investor, Mr. Daniel Hurst. How are you, dude? Good, mate. How are you?

Doing good. By the way, this is the guy who has the coolest accent on my podcast to date and have almost 200 episodes. So you guys are going to want to listen to this because this guy has the awesome accent. Well, you got to be good at something, I suppose. All right, dude. Well, listen, the reason why I specifically wanted you on this call is because you made a huge leap of faith of when you quit your very successful, very financially successful and lucrative job to go all in in real estate investing. And you just recently got your first deal, which was no small little deal. And so I want to talk a little bit about that and how you

were able to have the guts to go all in on this venture. And there's many people out there that are like you that have yet to pull that, you know, trigger and jump in all in. And then to kind of move in how you got your first deal and how that all came about. So talk a little bit about that, that transition from, you know, full-time employee doing very well financially with what you had going on to making that jump all in? Yeah, it was an interesting transition for sure. I've always dilly-dallied around in real estate a little bit. I had some rental homes in New Zealand and when I moved to Sweden, we looked at places there and then we moved to the US about nine years ago and had some had done a

couple of flips as a hobby and things like that but I'd always wanted to to get more involved in it and I've been with the same company for 19 years and moved with them to several different countries and well including the US and enjoyed what I did but you know it was never it was never really my thing right it was working for somebody else and so it got to the point where I've put in a lot of hard yards and a lot of work and being fairly successful in several areas with that and financially successful as well which was nice you know so it got to the point where I was you know 2020 crazy year and wanted to get more and more into this and it got to the point where i

was like you know what if i if i don't do it now when when will i do it do i wait for another five years until i'm two more years financially secure do i wait another six years do i try and get one or two deals under my belt so i i backed myself to be able to go back to the career if i wanted to with another company or with that company. I didn't burn the bridges, but I did leave in June with some systems already working in place in terms of the real estate and just went all in in June that way. And so having a look back, it's been interesting, very interesting for many reasons. Yeah. So it's been good. Well, I think it definitely takes a certain, you know, mindset shift to, to go from being, and you ran large teams and you were running sales and the whole thing where that is a huge,

um, you know, bonus in the sense of this really becomes a marketing and sales business. But to go from that to realizing, oh, you are everything, right? There is no more team. And then that learning curve on top of it all, right? On how to negotiate and how to find the right deals and what to say. And, you know, talk a little bit about that transition from, you know, kind of the executive life to being an entrepreneur and, you know, doing everything yourself? It was, yeah. And that's, I was so institutionalized, so to speak, in terms of the corporate life, right? I was used to my IOs. I was used to having my day planned out. And I was, although I was sort of in charge of that plan to a certain degree, I knew what my IOs were for the month.

I knew what I had to contact my people about, what they should be doing. I had the metrics that I had to check. And then all of a sudden, that's gone, right? And it took a good few months to rearrange that. My team was global. So it wasn't anything for me to wake up at 3 a.m., do a few emails, make a call, go back to sleep. And so it took months for me to actually sleep through and not look at my phone in the middle of the night.

Where the hard part was, was transitioning that, right? Now I've got my own business as such and I have to treat it like that. And so, you know, what are my KPIs? What should I do today what should i do tomorrow what does the rest of the year look like where is that paycheck coming from so um that was that's a big learning curve and i will say one that i haven't mastered yet like every day i learn something more and just implement something and it's for me it's real important to have a schedule

and to to not be like ah we'll see what we feel like today you know let's make some calls let's do something i need to know that in the morning on tuesdays i'm doing kpis wednesday morning i'm reaching out to more buyers thursday morning i'm calling people that i've already called before that are in the network just to touch base with them things like this so that really helped me with the organization um in terms of the sales, I mean, I was used to running a team and a sales team, but it was very different. It was the sales that we were doing were massive and it was very strategic and almost like a war-like campaign

that could go on for years. But I had to take those scenarios and those strategies and just compress them down to five minutes. Yep. Rather than, you know, four years and a hundred people working on it. That's why you, you hired me specifically for coaching and that, you know, to be able to shrink that learning curve. And I think a lot of people, you know, don't recognize coaching isn't always just about here's the blueprint, which in large part it is, right? So I'd advise you on the marketing strategies, what to say, et cetera, et cetera. But it's also, you know, being able to be accountable for the things that you should be doing,

right? And that, should I be doing this? I don't know if I should do this. And all those questions that go on in your head, right? Jumping from the full-time executive position into which you had a global team, not just national globally, right? Into, oh, I need to sell someone right now and selling their house to me. How do I do that? Right? How do I even find that person and all those other little things, right? And so coaching is just as good as for a blueprint as it is for the accountability portion. That's what's really been able to help for sure. Yeah, I 100% agree. It's been great in that regard. Now, obviously you had that transition period and you and I worked through that. But, you know, when things started moving, let's talk about how you got your first deal,

right? And when you finally were like all in, job this is 100 everything you're doing what momentum where did you see the momentum start going for you and you know what marketing strategies were you running and and ultimately how did you get that first deal so i had i i started the marketing while I still had my job. So I moved some of the money around that I had and because I had, I wasn't cash rich, but I was definitely time poor. Right. And so I moved with discussions with you. I ended up getting a VA who part-time and they can be very cheap and if you need to be, but you know, be where you get what you pay for sometimes. That right. Who taught you that one?

Yeah. The quality is remembered long after the price is forgotten. Right. Right. There you go. That's a good one. I'm going to take that one from you. The, and so I got a VA and that, that was good lead started coming in and that terrified the shit out of me to begin with. No, I'm not used to ringing people and being told no get out no or and then you made me start cold calling even more myself which or texting which which i was doing as well so i ran launch control and cold calling and i ended up changing my cold callers to lamisal leads and i've been great so they still work for me now so I'm mainly just doing cold calling now and then the other part which has worked really well is just contacts building

up my network working with the local guys working with local realtors other wholesalers one thing that I think is really important in this business is follow-up and communication I mean it's it's very rare that people call you twice they're usually like hey here's my numbers if you've got a lead send it to me but nobody ever rings you twice or three times or any of that so that's working pretty well for me as well the follow-ups and so yeah the first deal came about through a cold call through Scott Morse and his team and yeah it was a surprise. I've done 10 or so flips and have buy and holds and things like that so I've seen quite a bit of junk but this house the lady's like hey you know I want to get rid of it but just so you're aware there's a small bit of damage to the roof by a small branch.

So I went to look at the house and what she meant was a tree had fallen through the house. This little branch hit a corner of the gutter. So the gutter's a little, there's a little branch. The gutter's a little, oh, you mean a full tree fell through your home. Okay, got it. Yeah, not just one branch, but two branches. So one took out the side of the house and one went right through the middle of the roof. Got it. Classic, classic seller. Underestimating the rehab budget. Classic. Exactly. So, you know, I talked to her about pricing and what she needed and whatnot, and that was all good.

And the next week on the Monday, I rang up my tree guy and got him to go around on the Tuesday and have a look at it. And at the same time, I started ringing up, looking at comps in the area and started ringing the realtors of these comps that have been flipped with a sale and look like they've been renovated. And while my tree guy was there a guy walked up and told my tree guy that he wanted to buy the house as is and so the tree guy gave my number so i asked the guy you know flat out what do you want to pay for it he gave me a number i said that probably won't work i'll need to be a little bit

higher so he he said yeah yeah, sure, no worries. So I went back to the seller, increased my offer that I'd given her to what she actually wanted or her lowest number and got the deal signed that day. So it was an interesting one, that one. So you used your end buyer, his number, so you could go back and negotiate correctly with the seller. Correct. That's how you do it.

That's why, you know, reverse wholesaling, going and shopping for your buyer is such a powerful method is because you know exactly what they want and exactly what they're going to pay. All you have to go do is get it for them. Right. Yeah. And how much did you make on this first deal? 12,000.

It's not a small first deal. That's a great, I mean, it's's more in mind almost double what i got on my first deal right and so congratulations dude that's exciting it was and the that buyer turned out to be really good now too so he's he's told me that he wants a house every six weeks from me and so i'm looking for that so that's really good and but what i did find out which is a good mental aha moment is he said he probably would have paid another 30,000 over what he offered me for the house. Oh baby, you got to learn how to comp. You got to learn how to underwrite it. Uh, yeah, I, I was just happy. Right. So no doubt you can't, you can't be sad over winning,

but, uh, it's good to know his numbers now more. So now that I know next one, but you know, as, as I say, what does it, hogs get slaughtered, pigs get fat. So now that I know the next one, but you know, as I say, what is it? Hogs get slaughtered, pigs get fat. That's it. I just told someone in my office right now that exact saying because he missed out on a $70,000 lift.

He sold it for $70,000 light. He had a buyer that would have paid $70,000 more. So, you know, you take your wins. You can't be complaining when you make a profit, right? That's- I'm not even mad,, but I'm happy. So great job. So what was it that, um, what was the biggest learning curve you had to do with cold calling, right? You have a team cold calling. I also use Lamassu in multiple different markets, uh, in the, if you're watching this on YouTube or if you're not, let me put it this way. If you're listening to this on iTunes, iTunes, make sure you go over to YouTube. I drop videos every single day. My podcasts are also on

YouTube as well. YouTube as well. So if you just look me up, Justin Colby. So if you're listening to this on iTunes, go to YouTube because this is actually live on YouTube as well. But there will be a link to the services and all those things that we talk about here on the show in the comment section. So Lamassu is who I use. They'll ask you where you heard of them and then you'll come, you'll say Justin Colby or Science of Flipping

and you'll go from there. But why don't- Or Daniel first. I'm sorry? Or me. You can use Daniel or Adam first. Daniel was using them me. You can use Daniel or Adam first. Daniel was using them first. You can use Daniel or Justin.

It doesn't matter. That's not. The question, though, is what were the hurdles that you had to overcome when dealing with cold calling and those leads? How did you actually overcome that and get this deal across the finish line? The major one for me cold calling was myself right i the nerves i would uh i would maybe a little bit embarrassing but i'd sit here for like an hour and a half analyzing a property backwards and forwards thinking of exit strategies we're going to do this with it that with it come up with plans a through z do a risk analysis

uh you know i'd do the whole corporate works on this thing you know draw up a game plan this that you know try and map out what sort of personality i was going to deal with had this all in my head and then i'd call them and they'd tell me to f off and so i'd waste it an hour and a half and so i'm still getting used to it. Just call them first. So that's the big learning curve. Just talk to people. Call them.

Work out what their motivation is to sell and what their time frame is. And if a no is okay, you've got to go for no's. I was trying to make every post a winner. Say yes. Yeah, yeah, yeah. The reality is the secret sauce of cold calling is just doing it and calling them. Don't overthink it.

Don't try to map out the exact ARV and comp it all up front. Just get on the phone with them and talk to people. As you just said, a good friend of mine, Brent Daniels, talks about this all the time. TTP talks to people. And it's just as simple as getting to know why they're actually interested in talking to you.

Because by the time it gets to you, somewhere along the conversations from your call team to you, they said, I would be interested in talking further. So why is that? And that's all you're trying to do. You're trying to be a doctor. You're trying to prescribe the right medicine and ask a bunch of questions to figure out what's important to them. What values do they, you know, align with selling with a home? Is it speed? Is it money? Is it a combination of both, et cetera. Right. And being able to line yourself up with those values. And it's just the simple fact of talking to people in that conversation to your point leads you to going out to a home because she needed to sell it because a little branch fell into her house and uh it turned out

to be a tree and she realized the value of you coming in and you know making this happen quickly for her yeah the the big mental shift is when you stop looking for deals and start looking to solve problems yeah with that that changes my mindset completely 100 and that's i mean that's that's everything in this space and especially when it comes to you know dealing with homeowners to solve their problems be a doctor right and prescribe the right solution and they're going to love you you know

so dude this is awesome I appreciate you that's a big win I'm very very happy for you dude that's a start many many more to come right yeah one touchdown doesn't make a season. So you got all the sayings today. I love it. I love it. Full of something. That's all. That's your always. All right, guys, that is the end of this episode. Daniel,

he went from big time exec, having a global team into all in real estate investor, knocking out his first deal. How many days did it take you to get there? Maybe not from the start, but from the time you went all in, quit your job to getting your first deal done. How long did that take? It was about three months, but I don't think that's a fair reflection of the time, to be honest. I was pretty burnt out when I left my job and I would say that I didn't put in the effort that I should have. So once I actually made job and I would say that I didn't put in the effort that I should have. Okay. So once I actually made my switch, it was probably three weeks. Three weeks.

Yeah. Yeah. Once you made your switch, I get it. You're mentally burnt out. So you get that refreshed and then you went all in, took you about three weeks and that can happen. Absolutely. Right. So way to go.

If you guys need anything else from me, as I just mentioned, I drop YouTube videos every single day. Just go to the science of flipping.com. And there is actual a strategy session form. So if you want to talk to me about your business and how I can help, that'd be great. It's at the science flipping.com. I'm happy to do it for 15, 20 minutes. Just go do the discovery call, fill out the form and we'll talk then.

Otherwise, I will see you guys on the next episode of the science of flipping. 20 minutes, just go do the discovery call, uh, fill out the form and we'll talk then. Otherwise I will see you guys on the next episode of the science of flipping. Peace.