The Science of Flipping - new draft: 2025-05-30T04:26:45.510Z
Episode Date: May 30, 2025...
Transcript
Discussion (0)
Today, we'll attempt a feat once thought impossible.
Overcoming high-interest credit card debt.
It requires merely one thing.
A SoFi personal loan.
With it, you could save big on interest charges
by consolidating into one low fixed-rate monthly payment.
Defy high-interest debt with a SoFi personal loan.
Visit SoFi.com slash stunt to learn more.
Loans originated by SoFi Bank NA,
member FDIC. Terms and conditions apply. NMLS 696891. On WhatsApp, your personal messages stay
private between you and whoever you send them to. So things like the passport numbers for your
honeymoon stay between you and your fiancé. And that video call for your grand's 80th stays in
the family.
Even your streaming password stays between you and your college roommates, who still ask for it every week in your group chat.
Because on WhatsApp, your personal messages are yours. No one else can see or hear them. Not even us.
WhatsApp. Message privately.
Save up to 70% at Mattress Warehouse today and sleep better tonight knowing you got the
best possible price.
So where would you look to find the perfect mattress?
In a little mattress store or Mattress Warehouse?
Visit mattresswarehouse.com.
Still treating your real estate business as a side hustle?
At Joe Holme Buyer, we help real estate entrepreneurs scale to full time with right strategies, training and community. Join a winning community of go-givers.
Get access to weekly strategy calls, leadership training and industry expert
master classes. Plus we'll help you get more deals across the finish line and
increase your profits. If you want wanna stop grinding and start growing,
Joe Homebuyer is your competitive edge.
Because that's where I think you need to start.
I don't think any of us as entrepreneurs
go into entrepreneurship to make less than 250 grand a year.
But somewhere along the lines,
people want more, they wanna get bigger,
they wanna have employees, they wanna do more. But more doesn't mean net profit either this is why I want to
expose this kind of myth or or people talking about how like grow bigger you
know and all this other stuff I have so many points to just basically point out
that it's not always the case what is what is up, science of flipping fam?
We are going with a solo, dolo, hardcore, tactical, real estate advice from yours.
Truly, the Justin Kolbe.
Now if you're not following me on Instagram, you probably should.
I am giving away incredible content right there on Instagram. Go follow me at TheJustinColby and go follow everything and
you'll see some great stuff there. Now I want to dive in to some tactical myths,
the myths that I think need to be broken here in the real estate investing space, as well as I want to talk to like lead and conversions, right? And so there's a lot of
myths that I think that are out there that fly around from people that probably have never
really built a big business and probably are just solopreneurs and say things that they think to be true, but that aren't true.
And so, starting out with this idea is bigger is better and more is better.
Now, you talk to Grant Cardone and he's going to tell you bigger is better.
Now, he's done something pretty spectacular.
And many of you guys probably read books just like I do. And there's great book out there by Dr. Hardy you know 10x is better than 2x
so I'm all in alignment with that but I think from my own 18 years of experience
anytime I go way outside my realm outside my expertise without individuals around me in that expertise, I find that I always feel
some pain, right?
Sometimes it's just growing pain, sometimes it's some bigger pain, but I think there's
a lot of people that want to get bigger and more and more deals and more money and more
and more and more.
And I don't fully subscribe to that.
Now, I always want everyone here listening to me
and watching me on YouTube and Instagram
to push themselves.
I always want to encourage to grow.
I think it just needs to be framed in the right way, right?
I wanna talk specifically about like more deals,
more leads
and I want to kind of frame it in a way that I think you guys are gonna appreciate because
Whether it is a myth that bigger is better and more is more and better or not. I'm tired of people
Really kind of making that the narrative
What I do believe specific to the lead and deal flow side of what we do, mostly in the single family space, okay?
I'm talking mostly in the single family and then I'll circle back to some commercial and apartments.
But there are services that can help you actually do more deals with what you already have.
So a lot of times we as you know wholesalers and fix and flippers and
transactional investors we need more leads to do more deals. We need more leads
to do more deals. We always want to keep investing in marketing to do or to get
more leads to do more deals to make more money right? But I think there's some
efficiency so the first thing I'll tell make more money, right? But I think there's some efficiency.
So the first thing I'll tell you to write down right now is I want you to
look into lead detector.io lead detector.io.
If you are one of those investors that has a website and you push any
amount of traffic to the website.
And by pushing traffic, I mean if you do pay-per-click Google advertising or Bing advertising,
if you do Facebook ad advertising, if you do TV commercials,
and or even if you do direct mail with your website on it.
If you are driving traffic to your website then
leaddetector.io is a great service that will help you capture roughly 20 to 30
percent more leads than if you don't use lead detector. I'll give you an
explanation about this. There's roughly an industry standard that we see roughly one to 2% of those
that visit our website opt in to our form,
give us information, want us to call,
roughly one to 2%.
Well, so what happens with the rest of those people?
Where do they go?
What do they do?
What happens to them?
You know, I have a website.
Literally, I run TV commercials to this website.
It's called Justin buys Bama.
Okay.
We spend a lot of money every month doing TV commercials
for the greater Birmingham area and Tuscaloosa area.
And so on that website, I have lead detector for those that do not give
me their information out of the gate.
The only reason they're going to that website is because they saw my
commercial and they want to do something with their home or maybe
it's a rental home.
Maybe it's the home they live in whatever.
Why else would anyone go to Justin buys Bama?
I don't think there's a person ever on in the United States of America,
let alone the world who has googled Justin buys Bama without seeing that TV commercial,
or maybe even without someone telling him about it.
So for me, I want to figure, if you've landed on my website,
you have some level of interest to be there.
Cause it is your classic website saying,
we buy now, we buy fast, you know, we buy cash,
no appraisals, no fees, no, you know,
classic real estate investor website.
So we are getting roughly 20 to 30% of those people that just visit our website, we are
getting them dropped into our CRM with their contact information because of leaddetector.io.
Not only can I get their contact information, I can actually enrich the data and I can actually
pay for their credit score.
I can pay for the credit utilization.
I can create, I can pay for the credit availability.
I have access to be able to understand who is this potential client?
What is the scenario?
And then from there, I can keep my sales team focused on the people that
we believe to likely have the most financial pain and
When you can harness who your sales people should be focusing on
You ultimately are gonna win the bigger war not maybe just the battle but the war because your sales people will convert more
So this goes back to the more is better.
Bigger is better.
In this specific example, I do not always agree that you need to spend more on Google, spend more on Facebook, spend more money on TV.
You need to have tools like lead detector.io sitting on your website so that when people visit your website, they can actually
be captured and not only that, spend a couple extra cents on enriching the data so we know
who would perceived to be the most financially needing, if that's the right way of saying it, person, right?
Who is in the most pain financially?
If you're a sales team or you can focus on those people, you have a much higher chance
of conversion.
On top of which, you're getting more leads anyways. So even if you're not the best salesperson,
if you do not have to pay more for these leads,
you are just simply gonna convert more deals
out of a law of averages.
The more homeowners you talk to,
the more chances you have to get a deal.
And you're not spending another $250 per lead on Google.
All businesses traveling and ensuring
I get my morning workouts in.
Staying fresh isn't just a preference, it's a necessity.
But let's face it, after back to back meetings,
juggling two kids at home,
and the hustle and bustle of everyday life,
body odor can become an issue.
But here's the deal,
Mando has revolutionized how I stay fresh.
This isn't just another deodorant,
it's clinically proven to control odor
better than a shower alone with soap.
My favorite scent, bourbon leather,
it's fresh, it's subtle, and doesn't clash with my clone.
And I was surprised by how well the Solid Stick works,
even after an intense morning workout.
Mando's starter pack is perfect for the new customer.
It comes with a Solid Stick deodorant,
cream tube deodorant, two free products of your choice,
like a mini body wash or a deodorant wipe,
and free shipping.
As a special offer for listeners and new customers,
you get $5 off a starter pack with our exclusive code. That equates to over 40% of your starter
pack. Use code Colby at shopmando.com. That is S-H-O-P-M-A-N-D-O.com. Please support our show and tell them we sent you.
Smell fresher, stay drier, and boost your confidence from the head to the toe with Mando.
Attention, real estate enthusiasts and investors.
Are you ready to transform your investment strategies in skyrocket returns?
Join Jason Hartman and his team at Empower Investor Live.
This isn't just another conference.
It's your gateway to mastering the art of property investment
with insights and strategies from the industry's best,
including our host, Jason Hartman.
Keynote speakers include Sharon Lecter, Mike Maloney,
Tom Wheelwright, and more.
There's no sales pitch, just real, innovated, actionable content and tools. Whether you're a
seasoned investor or just starting out, you'll discover secrets to creating
lasting wealth through real estate. Know what is coming next. Learn market trends,
innovative tools, and network with fellow investors. Secure your seat now and be a
part of the movement that shapes the future of real estate.
Empowered Investor Live is the opportunity to make 2025 the
year you break all barriers to success. Visit empowered
investor live.com today for your ticket to financial freedom.
Don't miss out because spaces are filling fast. Go to
empowered investor live.com now.
Empowered Investor Live, invest smarter,
grow faster, transform your future.
So when it comes down to the idea
of a bigger marketing budget,
depending upon your specific scenario,
who you are, how much experience,
how big's your team,
you know, whatever, I highly encourage individuals who are doing any type of online marketing,
not to necessarily spend more money, but to take a service like leaddetector.io and put
it on their website.
Now, for some of you, you might not have a website.
So there's a great website would be rocket sites, rocket sites. They're affordable. They are very
specific to what we do as real estate investors. They're there
for you. They have the right message pre-built. You don't
have to do anything. You put lead detector on that rocket
site and you have a killer combination. Now let's go back
to talking about conversion.
The conversion of these leads is typically what people underestimate the value of and some don't, but a lot of people just want to keep spending
more, right?
They want to get up to 40 or $50,000 a month marketing spend.
But if I were to audit their CRM, I would almost guarantee you I'd find leakage
in conversion ratio.
And this is why I would tell you more is not always better
because any good sales rep, right, in our space,
they're really converting one out of every 20 leads
at worst, some really good one out of every 20 leads at worst, some really good one out of ten, but they can't hold more than I would say 70 to 80 leads at any time.
So if you look at your operation and you might be out there listening and watching this that
you are the only part of your operation, you are the operation, you might
realize, I have too many leads, right? I'm not even being
efficient in what I'm doing here. And I need to focus on
conversion. So then you say, well, how am I going to follow
up with, I'm going to make up a number here, how am I going to
follow up with 500 leads in my CRM? Knowing that you are the only person working those leads, well that's where
the cool technologies of today have come in, right? So like rocketly CRM has
automation within it that nurtures the sequencing of communication with those
individuals. Now typically that nurture can come through email, texting,
or you could physically call.
Now we don't do any outbound within Rocketly CRM.
That's, you know, obviously all those laws have hit pretty hard,
but if you need some sort of nurture sequence, leveraging
AI is the way to go.
Again, this is why I'm not totally in belief of more is always needed.
If you use AI for the use case,
and it's there and built in a way
that's communicating with the seller
to rehash the conversation or bring them back to the table,
then you don't need more leads,
you need the AI to work so you don't have to.
Now, this also goes to this idea and myth I to break of, bigger is better with your operation. Given the
state of technology these days, I just I don't believe that much anymore. And I'm
not saying some operations shouldn't be large, but if you want to be making a
hundred thousand dollars a month you don't need more than five people in your business. Five people.
Right now, again, I'm talking to the transactional real estate
investor here. I am not talking to the apartment owner. I'm
talking to the transactional real estate investor. If you
have one or two acquisition people, you have one or two acquisition people,
you have one or two disposition people and yourself,
you should be able to run a full-fledged hundred thousand
dollar a month transactional business between wholesaling
and fix and flipping for sure.
I would even make the argument if you do it the right way,
you could take those acquisition people and turn them,
not turn them in, but they, part of their job
is transactional coordinating.
They gotta make sure all the paperwork is done right,
all the paperwork is submitted to the title companies
or closing lawyers.
And then I'd also make the disposition people
be transactional coordinates as well. make sure all the jobs done right.
The earnest money is in the assignment is in, um, the loan is done, whatever
the case is done for the backend of it.
But you wouldn't need more than five to get this done.
I have a client I do from time to time.
I do one-on-one consulting, right? I take on one real estate
investor, one business, and I help them build out their
business, right? And I have a guy still to this day in Phoenix.
It is just him and he's just an executive assistant. That is it
to this very day. And he does well into the six figures a
month. Well into it with two
people and I'll tell you he does not work very hard he is choosing to do the
bigger better deals if it makes a small dollar amount he doesn't care he's only
looking for the big winners okay and because of that he doesn't need a lot of
people because he doesn't need to do a lot of, he doesn't need a lot of people because he doesn't
need to do a lot of deals.
He doesn't need to brag about, Oh, I did, you know, 30 deals this month.
He doesn't need to do that.
He'd rather do one or two deals a month and make, you know, 50 grand per deal.
Then do 20.
And I can't blame them.
As someone who's built out an operation myself,
having construction management, having operational management,
having TC management, having listings and property management,
I mean, God, we have investor relationship management.
I mean, I'm, I have a full-fledged business running.
Some of you guys wonder why I'm bald.
Austin deals, higher profits,
a roadmap to financial freedom.
That's exactly what we help entrepreneurs achieve
at Joe Homebuyer.
We provide the sales, negotiation,
and marketing training that separates
top investors from the rest.
But it's more than just education.
It's execution.
You'll get weekly strategy calls, expert lead masterclass, deal reviews in real-time
business coaching so you can scale with confidence.
real-time business coaching so you can scale with confidence. Plus, you'll be surrounded by a community of self-driven, winning entrepreneurs who push each
other to new heights. And for those of you who take this production to the next
level, you'll qualify for our exclusive President's Club, where you'll be
rewarded by luxurious vacations, recognition, and high-level networking.
If you're serious about turning your side hustle into a business that thrives,
General Home Buyer is your path to scaling fast and winning bigger.
As you know, accurate data and meaningful conversations with sellers drive revenue in
real estate. If you can't reach the right homeowner or property,
nothing really matters.
At QualitySkip, we provide you
with the most reliable up-to-date data
to ensure you connect with the right people
every single time.
Our premium skip tracing services
delivers precise verified matches
at just six cents per match,
a rate far below most
competitors yet with superior accuracy.
Whether you're a seasoned investor or just starting out, our services maximize your results
by turning quality data into more leads which equates to more deals and ultimately greater
profits.
Our proven process ensures you never miss a motivated lead thanks to
real-time updates and unmatched data quality. For a limited time, use coupon
code SOF for science of flipping to receive an extra 10% off. Let Quality
Skip empower your business. Experience the Quality skip difference. Visit qualityskip.com now.
But I would tell you guys,
you gotta make a decision on what you want.
Because just to do the social media flex
doesn't make a lot of sense.
Just to be able to say you have this big business
or this office or this amount of people,
it's really, no one really cares.
You know, I tell a lot of people, people always ask me, when should I hire?
When should I start hiring?
And my first question, and I want you guys to hear this question.
Are you putting 250 grand a year in your pocket?
Not in the company, in your pocket.
Are you actually doing that level of business?
Because that's where I think you need to start.
I don't think any of us as entrepreneurs
go into entrepreneurship
to make less than 250 grand a year.
Right?
But somewhere along the lines,
people want more, they want to get bigger,
they want to have employees, they want to do more.
But more doesn't mean net profit either.
This is why I want to expose this kind of more doesn't mean net profit either.
This is why I want to expose this kind of myth or people talking about how like
grow bigger, you know, and all this other stuff.
I have so many points to just basically point out that it's not always the case.
And you know, one things, one of the things that people aren't always thinking about is their bottom line.
You know, there's definitely been years, especially, you know, 8, 9, 10 years ago, we made a whole
lot of money top line.
We didn't make a whole lot of money bottom line, right?
I mean, it was very cool to talk about the millions we were making all over social media.
It wasn't very cool to know that I probably could have made more being a manager at a
Starbucks.
Right?
And so we start a business, we start being an entrepreneur so we can buy our time back.
Well, the only way you can buy your time back is if you're making money.
Right? And that's the point. So if you're listening to this and this is
maybe triggering you a little bit, then you got to really look at that. Because I
talked to an individual just yesterday, he actually applied to work with me
one-on-one and this guy's doing, really well, but he has a really small
functional team, right? He's doing, he's spending a hundred grand a month and
doing roughly three to four hundred grand a month, give or take on the month.
And that's very high functioning team.
Now I'm not suggesting all of you guys go spend a hundred grand a month,
but what I'm saying to that is he doesn't have some, you know, 18 person
office is very functional, very, the best word I want to use is like,
they're like snipers, right?
Bigger is not better.
The shotgun approach in this case, isn't better.
The rifle is, they know what they're looking for.
They know the areas.
They know the deals.
They know the profit margin spreads.
And he's transactional.
And he fix and flips and he wholesales.
And so I encourage you from this episode to audit what you're really wanting.
Right?
I mean, you guys have heard me say this time and time again, right?
The first law of success is you got to decide what you want and then who you need to be to get it. You know that to be the first law and then you
got to commit to that and I guarantee all of you say I want an office with a
hundred people and I'm making a hundred grand a year. No one's saying
that. That's not what you want. You want to be rich. You don't want to be working as much. But the interim to get there is you do need to work a lot, right? But then
you need to work smarter. So I'm gonna take a step back. I'm gonna bring this
conversation back to leads and conversion. You don't always need more
leads. You need to convert more and And you're not even capturing the ones
that are going to your website
because you're not using a company like leaddetector.io.
And so this is the whole cycle of this bigger and more,
all of it, like everything I'm saying at this point
would tell you, and I know this to be true.
In most cases, I mean most, it is not better. It is
actually worse. You will be worse off. You will make less money because you will
hire more people, you will have more costs, you'll have operational bloat and
you won't have the conversion of the leads at the pace you want and you're
not gonna make as much money growing and going big.
And by the way, this isn't even to mention about, you know, being able to increase profit
per deal.
We haven't even talked about that.
Now this doesn't have anything about being bigger, but if you focused your time, energy
and attention not on hiring and training and all that stuff,
but actually increasing your margin of deal, right?
Instead of averaging 10 grand, average 25 grand.
You don't have to get bigger.
You don't need more deals.
You're making more money per deal.
And that is just creating efficiencies.
And so, you know, I want you guys to realize
there's a lot of technology, not that that's unknown,
but there's a lot of great technology
like leaddetector.io, like RocketlyCRM,
like RocketSkip, there's a lot of AI,
you know, and you combine that with
an opportunity out there to have like AI data, which can get you
you know, the most highly motivated sellers out there. You
know, REI lead machine is another great resource, they
have lists that have AI data working behind it and scrubbing
that have AI data working behind it and scrubbing 400 billion data points,
400 billion and like almost half a trillion data points,
finding out who's the most highest likelihood
homeowner to sell.
You start to combine all this technology
and creating efficiencies, bigger just
ultimately will always point to not necessarily better. In our space there are
a few examples that you can say bigger is better for sure, but my experience has
been stay small and you can keep it all. The grant card owns of the world they
weren't inherent you know big real estate moguls but they surrounded themselves with people who are so my point to those that
do want to scale a business there's difference between growing a business
and scaling a business most of you should focus on just starting and
growing a business but if you do want to be the next grant card own or whatever
and scale then you need to make sure you have someone by your side.
You need to have experts in the field.
Grant is not the financial expert.
He is not the real estate expert.
He does a very good job surrounding himself with people who are,
and he doesn't even have to train those people.
So he will pay them handsomely.
So if you're going to do that, then you have to pay the people handsomely,
again, going back to operational bloat.
If you are at that place financially, fine.
My argument being is most of you probably aren't, okay?
And so I'm not trying to be negative,
I'm just trying to say be smarter, right?
Why don't you just go get rich, like real rich,
and then you can go buy your own apartments, right?
And so I want you guys to focus on that first.
And it comes down to operational efficiencies,
heavily leveraging technology and AI in today's world.
I still believe you guys need to have a human component
of the sales. You need to be negotiating you guys need to have a human component of the sales.
You need to be negotiating, you need to be underwriting.
I don't suggest to leave up analysis to technology.
I know there are people and companies
that are trying to make that work.
I don't like it.
I do believe you as the owner operator
should be operating a business a whole lot longer
than you think.
I think there's a lot of operators. I know there's a lot of operators out there that just get a little worn out.
They're tired of being a solopreneur and they start hiring out the acquisition role or they start hiring out the role of dispositions or whatever.
Those are the two roles that make you the most money specifically in the wholesaling space.
Why are you going to use those two roles as the first place to hire?
It doesn't make any sense
So you want to really think through some of these now?
I have a great group if you guys are newer. I'm not sure if you guys are newer yet
Are e I live co
My joke is I couldn't afford the M.
Reilive.co.
And we have calls every day, two, three hours a day,
Monday through Friday and Saturdays for the premium side.
If you are new and you're trying to figure out
how to get a deal, you don't need a coach to sell you
on five, 10, 15, 20, 25, $30,000 of coaching.
You need someone who's willing to do the deals with you and get in the trenches
with you.
That is what REILive.co is.
That is what it is about.
Great community of like-minded aspiring investors trying to break in and grow a
real estate investing business.
And I am right there by your side,
holding your hand, shoulder to shoulder,
doing it with you and sharing in the deal 50-50.
So if that's something that you're on the newer side
of this and that appeals to you,
go check out reilive.co.
If this was helpful and you think you know people
that need to utilize some of these
technologies some of these services the things I've mentioned as a as kind of a
rewind or reminder I guess is the best way of saying it I talked about lead
detector.io which is a great software that sits on a website and captures non opt-in leads lead detector.io rocketly CRM that comes with AI
nurture sequences so if you're bringing in leads you don't have to be the one
responsible for nurturing all the relationships the AI can so your
conversion rate can go higher.
You have what else did we talk about REI lead machine REI lead machine great list pulling and comping software that you can use to pull data that is the highest likelihood of a homeowner looking or interested in selling.
Our AI lead machine has AI data built into it.
And what else did we talk about? There's just incredible software out there right now.
Rocket sites, if you don't have a website, go to rocket sites.
It's already pre-built for us investors. Make sure you go to rocket sites.
And then lastly,
if you're a newer, you're struggling, you've been out there, you've been trying, you just need
someone to do it with you and you want to do a 50-50 deal split, go to REILive.co. REILive.co.
All right, y'all, if that helps and you think someone needs to hear some of this stuff,
make sure you share this with at least two of your friends.
We will see you on another episode of the science of flipping and make sure all people
know about the podcast.
Also as a reminder, there is a book I wrote, it has become a best-selling book, Flipping
to Wealth. Flipping to Wealth is found on Amazon.
It is out there for you guys.
Please check it out. It will help greatly.
It goes over my entire life story of the last 18 years in building this real estate business.
So, glad this helped. Share it with two of your friends.
We'll see you on the next episode. Peace. Visit sofi.com slash power to learn more That's sofi.com slash p-o-w-e-r
Loans originated by so fi bank and a member FDIC terms and conditions apply and MLS six nine six eight nine one