Transcription
[Music] How the heck did you get a 100 rentals?
Uh, it's a good question. Uh, being intentional, uh, and really focusing on it was step number one. And so, I'll give you a little bit of context of how I started and then I want to answer that question.
So, I spent 15 years in corporate America all in sales and sales management. I did very well in that space, but then found myself in my early 30s at a point where I was really unhappy. Like I wasn't happy with my growth trajectory. I was unhappy in my life and it was spilling out into like my marriage and my relationship with my kids. And I always wanted to do real estate just like a lot of people that you know, you and I both know, dude. And I was just too scared to pull the trigger. And I found myself in a place in 2014 where I just said, "Hey, if it doesn't happen like right now, it's not going to happen." And thankfully I had and still have a wife and a partner in life that uh believes in me more than I believe myself at that time did. So she let us take a second mortgage out on the house. She let us cash in the 401k, the life savings, max out all the credit cards. And we started in 2014, 2015 just flipping houses with the goal of how can I just replace my corporate income at that point, which was like $125,000. Right? So, if you would have told me 12 years ago that Jason can just make the same amount of money and he doesn't have to have a boss and, you know, be climbing the corporate ladder every day, I would have been a happy camper, dude.
And so, you know, fast forward to 2016, which is when I bought my first rental. Uh, I was fortunate enough to put myself uh in and around proximity to a uh other people that were about my age that were really adamant about telling me, Jason, look, if all you do is build a flipping and a wholesaling business, you just bought yourself another job. You've got to be smart and pull some chips off the table. And they just drilled it into my head that like you've got to, you know, for every two, three deals that you monetize, you got to keep one of them, right? And so from 2016 to 2018, we basically ran my flipping and wholesaling business at break even where, you know, we generated just enough revenue to pay my overhead expenses. Didn't pay myself a salary or anything. My wife was working as a high school counselor, so we just lived off of her income for the first real five or six years.
How much we went from?
I don't know, maybe like 90,000 bucks, dude. So I mean.
So $90,000 living in California. So $90,000 living in California is $15,000 everywhere else in the country.
Yeah. And it is. And we're in again for the people that are wa that end up watching the podcast, dude, we're we're in Clovis or Fresno, California. And so, you know, we're still affordable. Like, you know, median home sales price for us is high 300s and back then it was even lower than that. And so, you know, it's not like the sticker shock you get when you go to LA or or San Francisco, but it's still we had two kids. We had all the things that come along with the two kids, the mortgages, two car payments, all the stuff, dude. And um, I I say, you know, being intentional was the the initial answer I gave you. And I think you have to set that intention first. Cast a vision and then work your way backwards from there, dude. And so I set a really.
Jason, it's one thing to set the intention. It's another thing when life punches you in the face. It's another thing when your wife needs a new car. It's another thing when your kids, you know, want to play traveling, you know, sports or or they want to go to camps or they want, you know, you want to put them in the best schools or whatever else. You know, how do you, how do you be intentional and realistic?
Um, it was alignment between me and my wife and then that trickling down into every other aspect of our personal life and our business. And so, you know, I always say who you pick to be your partner in this life is one of the most important, if not the most important decisions. And I talk with people all the time where their spouse could be the husband, could be the wife, could be whoever that just is there's resistance and friction through that entire way. You have somebody that's a dreamer that really wants to do cool amazing things and then somebody that kind of ends up being like a wet blanket that just puts that fire out every single time. And that's exhausting and I don't think it'll work. And so I think for us, we were I was fortunate that I had somebody that I said, I always say this, Jen, my wife, believed in me more than I believed in myself when I got started. And she was willing to go on that ride with me, dude. And I had sales background and a sales acumen. That's what I was really good at. What I didn't know was anything about construction, dude. So for her to let us cash in all our chips and buy some house when I had never, I couldn't even fix anything at my house, dude. So when she, when we would go look at some of these properties that we would buy, we would laugh at each other. She was like, "Are you sure about this?" And we just made it happen, dude.
And um, you know, just to to put a bow on the the question you asked about the rentals, dude, we we we we flipped and wholesaled the first couple years just to get my feet underneath me, 2016. Towards the end of the year, I bought rental number one. By the end of 2018, I had gotten to 50 doors. So that's what intentional effort stacked on top of like an unrelenting work ethic, which I think is one of my strong suits is just I am a worker and I've never been afraid of hard work. I've never been putting afraid of putting like the time and the hours in. And that's what we did, dude. And so 20, and it was one house at a time for the first couple years. And then we got into multifamily and some small apartments. So we made some incremental jumps, but it was literally one single family house at a time for the first year and a half until we started like big picking up rentals in in bigger in bigger tranches.
And um, you know.
Do you prefer multifamily over single family?
Honestly, the the stuff that performs the best for me are my small multis, the two, three, and four units. Um, single families also do well, but then you have the risk of if that person's leaves, you know, you don't have any other income coming in. My smaller apartments, like anything above four units, you know, those we have more issues, you know, and it's I had a mentor of mine tell me, she goes, "If you have 10 apartments in one property and then you've got 10 single family houses, if you got 10 people living on top of each other and all of these other things, you're just going to have more issues, right?" And so, uh, we're actually selling, and I'm sure we'll get into this a little bit now, we we grew the portfolio north of a 100 doors. And we're selling a a big chunk of them now to to liquidate some of the equity. And it's the the small apartments, the 6, 8, 10, 12 unit ones that were not in great areas that have some deferred maintenance, but we've got a bunch of equity in. Those are the chips that we want to cash in now and and and redeploy into some bigger projects that we got going on.
Got it. So, how did. Yeah. How did you decide which one to cherry pick? So, you took two years. You you went from 14 to 16 flipping and wholesaling. Did you understand what wholesaling was? Did you buy from.
I didn't understand anything, dude. I learned from listening to Shawn Terry's podcast in Bigger Pockets. That was it, dude. And Shawn Terry had uh like a five-part series where it was like, "Here's what wholesaling is. Here's how you do your first batch of handwritten letters. Here's what you do when the call comes in. Here's what you do on the appointment. Here's how you do." I studied that like you would study, you know, a college course or something, dude. And I really just went kind of step by step and I failed forward and I didn't invest in any coaching, frankly, cuz I didn't have money at the beginning to do any of that. So, like I all that information, I just found it and I I tried to apply it the best that I could and I figured it out the best that I could. And then, you know, as I got my feet under me, we started to build some momentum and move at a faster pace.
Awesome. And you took all that, you were just kind of growing the business, putting it back into marketing, not taking any money out. And then what how did how did year three explode like you went one two years and and your wife's supporting? I assume you started taking some money out in those first two years at.
No, dude, we didn't take any money out, dude. That was the other.
Growing the business to flip more.
To to to flip more and replace my income first. But because we were so disciplined and strategic about how we managed our finances, we really did sacrifice a lot for that first four or five years, dude. And I think that's a another thing that I think is something important to share with the people that are listening. We really really focused on delayed gratification. And we said, "Hey, could we do an owner disbursement? Could we pull money out of the business right now?" We could, but that's not going to get us closer to where I wanted to be. I was so focused on kind of building a moat around us and our our personal finances and I just looked as rentals as the vehicle that will allow me to create a cushion. God forbid something happens i.e. the market changes or interest rates go up or COVID or whatever insert whatever thing that comes up that you and I have seen over the years, right? And so I was just deathly like I was laser focused on that. And we picked my head up in year five. And I remember this and I still have the check, dude, framed in my office at my house. I still have it there. I paid myself like $4,300 because my bookkeeper said, "Hey, do you want like there's money in the account if you want to pay yourself some money, dude?" And I said, "Well, how much money should we pay?" And she said, "Well, you need this much to run the business. So here's like 12 months worth of reserves, and then this is what we have left over. And if we take what we have left over, we can carve out about this. And that's how we ended up at $4,300. And that was the first time that I ever took any cash out of the business. Dude, it was like over 5 years in, probably flipped a 100 red properties at that point. And we had accumulated 50 rentals, dude. So, it was delayed gratification was a big big part. And I think real estate people in general have a really big problem with that because you and I both know, dude, you can make money really fast in this business. But that doesn't mean that you have the discipline and the fiscal discipline to like really manage that, dude. And so sometimes it's easy come, easy go, dude. And you see it a lot, dude. Some people have one, two really hot years, but they didn't save for a rainy day. They weren't smart with their investments. The market shifts on them. And when the tide comes out, you see a lot of the people that uh that you know weren't wearing any clothes.
Yeah. Have you always been like that? Like you are an anomaly. You might be the first person I've ever spoke to that has 15 years of sales experience and didn't splurge and was disciplined and was it like because you know sales guys there's a skill to it and you go oh okay you know I'm really good at this. I can go out and make x amount no problem so I'll spend now. uh and and enjoy my life. I'm going to enjoy life. And I, you know, you kind of stay on the treadmill, so to speak, the sales treadmill for a while. But that's okay. You like it, you enjoy it, you're good at it, and you keep you just level up. You just sell stuff that that you make more per sale. And life's good. I mean, that's the that's the mindset of 99.9% of really great communicators, really great salespeople that know how to do discovery and know how to solve problems and know how to um, you know, be fast with communication and and are really the the top of the top. So, where the heck did you get that discipline? I mean, did you grow up and your family's like, "Here's your allowance, but we're keeping 90% of it and we're going to put it over here and you can't touch it for 30 years."
I wish, dude. So, my wife is definitely I always say I play offense and my wife plays defense and that's how it is right now even in our business. So, I'm really good at making money. My wife is really good at managing our finances. She had kind of that background that you're talking about where like she had the envelopes when she was young and she would take in her allowance and put like a couple bucks in each envelope and she was just she had a knack for that. I was not always like that. And I would say here's the thing that changed me and it's it's I'll give the 30,000 foot view and it may be a time for another story, but I I would say I hit what my rock bottom was in my life in 2012. There was lots of things that culminated in me going through a really rough patch of my life. And I I always say I hit rock bottom in 2012 and I got dragged along the bottom for two years straight where I had to look myself in the mirror as a man because of some really poor decisions that I had been making and some bad like bad positions I had put my family in. And I had to say look.
You know you want to be up here. You're down here right now. The actions that you are doing are causing a lot of grief and trauma in your family. And I was very fortunate that my wife again just rode through that really dark period right there alongside of me and then now has ridden the wave back up. And I think it was a combination of her kind of like willing to kind of go through and be really disciplined about everything plus going through kind of these transformational moments that some of us go through that were really hard in that time period. But now looking back like 12 years later almost, I wouldn't change a thing, dude, because it was that kind of traumatic experience that I think was required in order for me to be able to really like look myself in the mirror and say, "Hey, dude, something has got to change. We can't keep going down this path." Right? And it's something I'm curious about, dude. I you know like you and I probably met lots of people that have kind of gone through these like transformational things and then other people where it's not required for them to hit rock bottom. I know for me my ego was so inflated, my head was so big, dude. Like I needed to be brought back down to reality in order to kind of reassess and go from there. So that's what that's what it was. It was a combination of those two things.
Yeah. I love it. And now so you've owned these properties a good amount of time, almost 10 years. You've got great equity in them, right? You've got uh a hundred doors. I mean, what your whole whole portfolio, what do you think it's worth?
It's probably about $17 million right now when you add everything in. Yeah.
And how much equity?
Uh I I don't track this as closely as I want. I'd say on the low end, eight on the high end, maybe nine or 10. Uh, I mean, these single family houses and a lot of the stuff that I was buying, especially on the front end, I mean, you used to be able to buy two-bedroom, three-bedroom houses and, you know, C neighborhoods or maybe a little bit rougher for $50, $60,000, $70,000. All those houses are worth $250 to $300,000 now, dude. So, you know, I bought all of them for 50, 60, put 30, 40 grand in, fixed everything. Now they're worth 300. So you you know you multiply that out and we've got significant amount of equity and the stuff that we're keeping is the stuff that does has like all of our apartments and you know this with commercial loans the rates reset after a certain period of time but all of my anything four and under has 30-year fixed rate debt that we refinance when things are low like it doesn't really I don't need to sell that stuff dude you know what I mean but the stuff that like we were talking about earlier that just management intensive not great areas lots of deferred maintenance but stuck equity like in and variable rate debt that we want to just kind of get rid of, pull that equity off and and just save it for a rainy day and and redeploy into other things.
Love it. How do you find your deals?
Uh we do very well at direct to seller. That's one of the things that um that has been I think you know our strongest suits. Um, you know 70% of our business all is generated from direct to seller. So just for context of the way the business looks and feels now we were talking about it earlier. Our team does about 100 deals a year. Um, direct mail marketing is our number one lead channel. We spend about $35,000 a month on direct mail. Um, and that's where we get the vast majority of our leads. Our overall marketing spend fluctuates between $50 to $55,000 a month. And that variance that 20 that 15 to 20 grand that's left over is deployed on PPC. Um, we do some PPL. Um, there's something else that I'm missing that's inbound right now. We don't do TV or anything else like that. And then we still have uh cold calling, no longer SMS, but we do some cold stuff too to just supplement lead flow when it's down a little bit. Um, but direct mail is is definitely our number one. And then referrals makes up the other 30% of our business because of I'm very active on social media. We've been putting events on forever. I've been a licensed agent since 2018. So, we work really well with agents and brokers here in our market. We're very friendly and collaborative. So, you know, direct to seller makes up most of it and then the rest of it comes from referral based business.
30 deals a year from referral.
Uh yeah. Yep.
That's incredible.
I I say it all the time on this uh on this podcast that if you can get if you can find 30 people to send you one deal a year, you're set for life.
Yep.
You know what I mean? No cost.
Average what what's your average deal size?
Uh $27,000 and some change this year. So you're $700,000 a year just from referrals.
Yep.
Incredible. I mean, is it one of those things where it's like it's other wholesalers bringing you deals and you're dispoing them? So it's like, no, the these are people, hey, go buy this house.
Yeah. We maybe buy two to three properties from like like wholesale the way that you and I would kind of describe it, right? Everything else is agents, brokers, friends, families, partners in the business that we like, we'll throw referral fees in here, but we don't have any paid ongoing marketing expenses, right? And so, um, you know, when you put meetups on for eight years in a row, month in and month out, and you start with five people a room, and then it turns to 200 people in a room, and there's never any ask. All it is is just let me pull the curtain behind uh pull the curtain back on my business and I'm going to share with you all the things that I do to find success with this particular thing, dude. And I think it was a good time and place because meetups back in 2017, 2016 when I started doing mine out here, it was a local investor that would like shoot from the hip for 15 minutes and then it would just be like everybody bring me your deals and it's the same 10 people every single time and it doesn't really grow into anything. And uh one of the guys got tired of putting them on so he gave up the ownership of the Meetup group. I stepped in and I immediate was like, "Here's how I do basically everything that was working in my business in depth. Plus, I would make myself available after the fact and it just grew and spiraled. And when you give that much, the universe always it always comes back, bro, and provides, man. That's been what's been proven to me."
Yeah, 100%. And you're still doing those meetups.
No. Well, you know, we talked about it a little bit before we jumped off, like we've made the decision now just, you know, I was doing them, then Dean and Strat started doing them, and we're all friendly with each other. So, four years ago, we decided to kind of for join forces, and that's where Deal Champs kind of started. And you know, we're at the space because of some of these larger projects that we're in right now where you know, uh, earlier this year, I just made the decision to say, hey, you know, this was great for the time and season that season of my life in business, but now, you know, we're going to make a more intentional focus on making sure our main business is as optimal and dialed in as possible. And we're swinging for the fences with some of these uh the land deals that we're working on now.
See, see, I feel like you have to do that every once in a while. You know what I mean? There's like a you you do something every month, every week at this time and that's what's that's what you do and it's been going on forever and you're consistent at it. Then you just decide one day, you know what? I think I'm going to free up that time for something else. You you feel refreshed. You feel like a like a new baby. You feel like, oh my gosh, okay, look at look at all these other things that I could put my attention towards. You know what I mean? Like I think you have to do that every once in a while.
Yeah. Yeah, I think you know once you've been in the business for a while, it's it's less about the opportunities that you agree to do and it's more about the things that we say no to, dude. And really learning how to protect our time because our time, I'm a big believer, is our most valuable asset. And and you know, I'm pretty meticulous with how I track and manage my calendar and my time. And it's very easy for me to look at and say, okay, based on how I just spent my day, you know, here's a direct line to where my time is being invested to. And it just after a while it just was like I'm trying to go do these things over here but all my time is getting pulled in another direction. We've got to say no to some of this stuff, recalibrate and push that energy towards whatever this new target is. And I've gone through I I'm sure you have too, dude. Just the the this evolution uh where I've had to say no to things that it's not like education for me was not financially viable and we weren't making money from it. The exact opposite was true, dude. And it's even harder in my experience to say no to the things that aren't working uh or excuse me that are working versus the ones that aren't. Right? So it's like if it's not working and it's a complete it's losing money then sure pull the plug on it. Nobody you know anybody can do that. But when.
You are getting fulfilled it's making money you're getting a viable financial ROI. It checks a lot of those boxes, but you have a vision for something bigger to sacrifice this thing right now in order to have faith to take this next step up. You know, not everybody can do that, man. And uh I think that's the that's been the the thing having to make big decisions like that, you know, have have been pivotal in in my in my journey and my growth for sure.
Let me let me pivot back to lead generation.
Sure.
Because I always get excited about this and I think the audience gets excited about it. So 35,000 in direct mail. All right.
U I've done direct mail. I've tried to do direct mail all the time. Every couple years, Jason, I go, you know what? I'm going to do six months of direct mail, and this time it's going to work. And every time it does not, I get like a one to two uh like a 1.2 or 1.5 to one return. I mean, it's it's kind of profitable, but after all the cost and the commissions and all that taken out, it's really not it's it doesn't make sense here in my market. Um, and and we've got the systems in place. We answer the calls live. We've got the best people answering the calls. We we get calls. It's just it's just not something that works here. So, how does it work in your market? I mean, you're spending 35,000. Is it something that you're like, "Hey, listen. 6 months isn't enough, Brent. You got to go a year. you got to go two years before you're getting that bigger ROI. People have to see your stuff over and over and over again. Or is it just some markets it works, some markets it doesn't?
I think it's a little bit of both, dude. I think 6 months is the absolute bare minimum with the prerequisite of all the things that you let up with by saying like calls are answered live. Like we have a standard standard in our business is if we miss a call or we're on a call with another seller and this is all timestamped and tracked, you have 60 seconds to call that seller back, we cannot miss. And so we literally track every single inbound call that way. And our team, because of my sales background and all the work that I did in corporate America, plus everything I've learned in the 12 years doing this, we just we do not leave any meat on the bone when it comes to our sales process. And so I think if you can check all of those boxes, then it's just giving yourself enough of a sample size in order to see it. So I think 6 months is the very bare minimum to do a look back to gauge performance. But I really feel like 12 month commitment is really what you want in this market, dude. You know what I mean? like had this been you know co or sometime right after co when everybody is making money and things were a little bit easier or even further back than that when there was less you know I don't like the word competition but there's just less investors in the market then maybe you know 3 to 6 months is a big enough sample size but right now you know outside of your marketing piece and the copy on the marketing piece and the list that you're mailing and the cadence that you're mailing the list like all of those things have to be there it isn't like we can just you know send $500 driving for dollars uh postcards out every month and then expect to do a deal out of that. Dude, you know, our our response rate has gone down just like everybody else. We get a hovers between three and a half and a 4x ROI. So, I have other channels that produce a higher rorowaz, but this is the one that I have found for me is the most scalable and the best suited for our team. The way that I've trained them to actually work together. So that's why we push the marketing dollars that we have and the budget that we have behind this and then we, you know, are a little bit more strategic with our spend on everything else.
I love it. Who do you mail to? What what list do you like?
So right now we mail, we use 8020. You're probably familiar. So we buy, you know, all of the counties in our market directly from 8020 and we get a big master list from them. When I started it was uh and this is what I would recommend for those people that are listening that want to start mail but you know they hear 35,000 a month and they're like well that must be nice Jason but we're never going to get there right? So you need to start with some really hyper niche lists that fit within your budget. So I always say start with your budget in mind first. So if you can commit to let's say $3,000 knowing I have to go for at least 9 or 12 months. You have to make this mental shift that I basically am committing this year if I'm going to go for a year at let's call it two grand a month. I'm commit that $24,000 that's already spent. That money is gone. So you have to just make the commitment that it's there. And you need to start with one or two niche lists that on a $2,000 monthly spend depending on the mail piece that you use, you're probably going to mail somewhere between 3,000 to 4,000 homeowners. Right? So, how can I get a niche list with multiple pain points in the specific? You're not going to go countywide most likely on a budget like that. You're going to go city or most likely zip code, right? So, we're going to look at the top seven to 10 zip codes in my area and we're going to put these specific pain points layered on top of each other and then that's going to become my list. So, pain points become the talking points in our appointments, right? So you can stack code enforcement on top of notice of default on top of you know insert whatever other you know thing that's there right and you can put together these lists that have multiple pain points that become the talking points for most of the sellers that were out on their appointments and your job is to understand as an investor how do I solve these problems right? So you have to get really good I think at solving code enforcement then solving probate then solving this and then you're if You do it the right way. When you get good at doing one of those one, marketing to one of those lists, solving those problems, then the deals come, then the revenue comes, right? And then as that revenue comes back in, you earmark 30% of whatever that revenue comes in from that deal into the next niche list. Right? So then we're doing some more marketing. I'm also simultaneously learning a new skill set because I'm learning how to solve a new problem. When I learn how to solve new problems, we do more deals. When we do more deals, we have more revenue that comes in. And then it's just that cycle. It was that cycle for us over and over until it got to the point where I had one VA all day. All they did was scrub data for us. So they would go to every city and county, pull every single niche list that you could do, put it all into one master sheet, then we would chop it up and mail it. And it became so cumbersome that it made sense for us to transition a couple years ago to a company like 8020 that basically does all that work for us for a fee. And then we can just scale much faster, you know, because now we just need to go to 8020 and say, "Okay, we don't need 70,000 records. Now we need 100,000 records because I'm bumping my budget up to 45,000 or whatever it works out to be, man." So.
Yeah, data scientists, that's what they.
Correct. You need to understand the data. Yep. 100%. You need to understand that data where it's coming from, match it up with your budget, and then you got to stick with it, dude. Because like you said, like I six months is the bare minimum that I would say is probably the aotted time that you need to really see how that's working and you probably need to commit to something more, you know, and I think making that clearing that mental hurdle of like, dude, this money is spent. I've already committed to spending this money. I don't care. It's gone already. So, if I'm spending 24,000 this year, I got to do three deals to get the ROI that I want, you know, if my average deal size is about that same.
It It is funny cuz it's sneaky, right? Direct mail is sneaky because they don't just call you the month that you send it. So, we stopped in July. I mean, we went January through um uh June, so 6 months and 25K a month. and it was like break even at in in June and now it's kind of you know now we've gotten a few more then you get these sneaky deals. So Jackie, uh, my lead manager who who runs the show, I mean, she's really like the COO of the business is like, "See, see, look. Oh, it's a direct mail deal. Oh, it's a direct mail deal." I'm like, "Oh, man."
You know, um, but I don't know the um, now now you're making me go, "Now I'm going to do it again. Now, geez, you know what? I shouldn't have even asked. I knew I shouldn't have asked. I knew I should have just skipped over it. I shouldn't have talked about direct mail because it just gets me hot and bothered.
The other reason why I like mail, Brent, is we were talking about it earlier right before we jumped jumped on live is this is something that I think especially if you think about the avatar of the seller that we're speaking to, you know, older, owns a couple properties, they've had those properties for a long time. They are ingrained and conditioned to go out and check their mail, look through every single piece just like they probably still read the newspaper and a lot of other things that younger generations don't do. And it's less disruptable in the way that like SMS can get disrupted. You know what I'm saying? Like I was around in 2018, 19 whenever SMS became kind of the hot thing and then everybody was doing it. And then, you know, you fast forward a few years later and AT&T, T-Mobile, Verizon, all these companies, they have the bankroll and the budget to beat us every single time. So, they're going to figure out a way to make their customers happy and stop all of these spam texts and calls and things that are there. And, you know, until mail goes away and our ability to contact uh sellers, you know, and put a piece of mail in their post office box goes away, I think this will be something that continues to produce. And I know in our market it's it's definitely uh one of the highest performing channels for sure.
How many acquisition managers do you have?
So my acquisitions team looks like director of acquisitions. Okay. So he runs and manages the team. There's two acquisitions managers and then we have right now three leads managers but really we want to do four. So we want to set up pods. So we want to have two leads managers for one acquisitions manager and same on the other side and then one dispo right. So um because of the geography of our market, our acquisitions managers are based in territories, right? So we have an acquisitions manager in Fresno that basically goes an hour in any direction and then we have an acquisitions manager in the southern part of the central valley out in Bakersfield. And then they do the same thing to cover the geography that they oversee. And in order to hit our goals for 2026, I think the team is pretty much fleshed out. We need one more virtual leads man. All of our leads managers are virtual. Our acquisitions team members and everybody else acquisitions dispo, they're all in person here in the office. So, uh, we need really one more leads manager to to be really like dialed in. But we're close, dude. It's been a lot of work. I mean, and this was, you know, a few years ago.
What's a leader? leads manager is for us the way the their roles and responsibilities are their first line of defense for any calls that come in. So any inbound whether it's a PPC lead they go straight to our website it's a call from direct mail uh you know whatever it goes to the leads managers first at round robbins we use reimply reimply is our CRM our phone system is baked in through reimply so we can track everything and lead comes in and at round robbins to the lead manager pool first person up answers the call that lead stays with them into their own individual pipeline their job is to qualify the lead set an appointment for the acquisitions managers. So, we want our acquisitions managers in total, we want 12 appointments set a week and we want them to go on at least nine attended. And from those nine, we want to be closing two contracts a week.
Love it. Uh each.
No, one each. So, 12 total, nine total attended for the entire group. Each person is responsible for one. So they're probably going on a slow week, three and on a busy week, five or six appointments, each acquisitions manager, and their job is to bring home one contract a week. So to stay compliant with us, they need four contracts a month. Eight total is where we want to be as a company. And lead managers are essentially the setters. They're the ones that are taking. So I always my my philosophy in this is very similar to yours, Jason. I want somebody that is in the office all the time and I want the my closers in the streets at all times. You know, we do all in-person appointments. Same.
At this at this point. And uh that seems to work out really really well. And I believe in markets where your median sale price is over 300, if you're not going on in-person appointments, it's going to be really, really, really difficult to get to to win at a high level unless you're in the Midwest. The Midwest is different, but usually they're under 300,000 or in that range. And you can you can do uh a model where you can go virtual in the Midwest as long as you're not in those higher price points. But once you get over probably 3 350, 400,000, you better be on you you better be uh belly to belly.
Belly to belly. I've always been a big proponent of bellyto belly. We went you know it was skewed obviously during co when nobody was kind of letting anybody in the house and then we leaned on virtual acquisitions for a while but you know 3, 4 years ago we started to make this shift where it was more balanced and now we're kind of like you. We do 90% of our appointments in person and the 10% that are virtual are typically when sellers are out of the area and they just can't meet us. You know what I'm saying? So, it's an out of state or out of area property owner that we can't and we'll even push to do like a Zoom appointment cuz we want that that face to face that energy transfer, the confidence transfer, the trust transfer that happens when you're looking at somebody versus doing everything over the phone I I feel like is different. So in person obviously is ideal, but we want to we want to uh set ourselves apart by, you know, being able to really build that rapport with the seller.
So you got one, two, three, four, five, six right now on acquisitions. Look to add a seventh and one dispo.
Correct.
Awesome. Now you have really made the jump and uh I am I'm excited for you. I'm nervous for you to be honest because I know a lot of people that make this jump, Jason. And it it either it either is a rocket ship or it's a submarine, bro. That's right.
You know what I mean? And and what we're talking about is land development.
I mean, this is big boy. This isn't this isn't uh, you know, negotiating a $20,000 assignment fee. This is longterm strategy. This is picking the right right opportunity. This is going through a tremendous amount of red tape, right?
So why all of those things.
Are you are you just uh you know uh a massochist? Are you just a glutton for punishment? Are.
There's there's there's a component of that. I think there's also a bigger component of I have always had the vision to do real estate at the highest level. Like even now and uh for lots of years, dude, we would drive around and and you see this too. Most people they just pass by, you know, 300 units of brand new construction. You're talking about a hundred million project in California, probably 200 million or more in your market. and they and they they just don't it doesn't register that somebody looked at a piece of dirt and had a vision to pull all of these apartments out of the ground. And for whatever reason that whole from the vision casting and seeing the start to finish and then getting in there, the deal making, the capital raising, the negotiate, all of the things that have to happen to get it from dirt to, you know, 300 families living in those apartments. All of that stuff has been very interesting and intriguing to me. I've been fortunate enough where I've as I've leveled up, I've continued to put myself in rooms where I try to be the smallest fish in those rooms. I try to be the smallest person because just being around and in proximity to people that motivate and inspire me, it it just makes my brain, you know, the gears in my brain crank in a different way. And so, uh, you know, I think I'm wired that way. So, I always wanted to do it. Uh, but then everything because I've heard all the horror stories that you've heard, dude. And I think all of the the people that I know that have been in the business prior to the crash, all of them have war stories of a deal that they did that went sideways and they lost their ass on it and all of this stuff. And so I think a lot of people have uh PTSD when it comes to development deals. Here's the first deal. I'll give you the background on the first deal that, you know, that we're working on right now and why I think it was the right one for us to do. So, speaking about relationships, about uh, you know, just over a year ago, I got a call from a broker buddy of mine out of nowhere and this is how I think it's a God thing. Here's how it worked in my life. I was literally getting a haircut. I was in my barber's chair and I was like, "Okay, I saw it and I was like, I'm going to call this guy back, dude." And something told me, "Just answer the phone, dude." Like, while I'm in the middle of the haircut, I answered the phone and the guy answers and he goes, "Hey, dude." He goes, "I know land is not your forte, but I'm representing a guy out here. He's got development experience. He's a buddy of mine. He's in what appears to be a really good deal. He's going to be out of performance like next week. And he needs somebody to round up basically a million dollars cash in this much amount of time. And you're the first person that I thought, dude. And even then, I was super skeptical, dude. So, fast forward a little bit. I get on the phone.
with this guy who's now my partner in this deal. And you know, I'm sure you get approached with every kind of like hairbrain idea in the world nowadays. And so, I always am like, why am I the lucky guy, dude? Like why did I get this call? Like how, you know, just trying to poke every single hole that I possibly could. And the further that I went down the rabbit hole, uh, the more intrigued I became.
And long story short, we bought 78 acres in central California right next to 300 existing houses on one side, another 150 houses on the other side, already zoned. All of the utilities are in. We paid a million 25 for all 78 acres. So for those of people that don't know how to underwrite like bare land deals, we got an incredible smoking deal on that. Right. So the 78 acres right now, we're doing a 13 acre piece that is zoned already for multifamily that you can do about 300 apartments. On the other 65 acres, uh, through help with the engineering company that we hired, we were able to carve out 248 finished lots on those on those prop on that on the remaining property. So, we're in contract right now to sell all 248 of those um of those lots to a national home builder for $26 million.
So, no, I swear, dude. Um, now, we've got to finish the lot. So, we're committing to doing the horizontal development. So, this isn't just paper lots where we just paper everything up and then they do all the work. So, we've got to put about a $12 million investment into grading and streets, curbs, gutters, all the underground infrastructure. Um, and then hand over finished lots. And so, uh, hence why I'm liquidating some of the stuff that I own to property capitalize the the the deal that we're doing, right? But, dude, I saw the LOI come in and all the things that you said, dude. All the everything was going off in my head. You're dealing with publicly traded companies, dude. $4 billion company. This is like one of the biggest builder. $4 billion a year that they make in revenue. I had to go hire a land use attorney to negotiate with their in-house legal. Engineering's $900,000, dude. So, it's like I'm writing checks that we're used to that are like, you know, 10, 20 grand that now are nothing to me. Now, we're writing multiple six figure checks, dude. And it's still like having to piece all of this stuff together on a deal that has like a 3 to 5 year runway from when everything is like done and approved. Like it does not move at the pace that we're moving at right now, dude. So it's like I I'm going through all of those challenges and clearing some of those obstacles that you were talking about earlier when we started this topic. But it's what I've always wanted to do, dude. And so for me, I've got an 11 or 12 year track record of telling myself, I don't know exactly how I'm going to get to this point, but I know that I'm smart enough and I'll work hard enough to figure it out. And I've been doing that for the last 12 years in a row. So for me, when I flex that muscle now, it's easier than it's ever been for me to have confidence and say, "Okay, this is my shot. I'm calling my shot." And then having the faith that we're going to get there and figure it out, dude. So it's a interesting ride, man. It's a a wild ride, but uh I I'm in a space where I'm really really excited and charged up in a way that I haven't been about the business in a long time.
>> Do they put any guarantee on that LOI? Do they give you any kind of financial?
>> So there's there's LOI and then you go in contract, right?
>> Okay. And then there's a due diligence period and then you you can negotiate uh just the same way that we would negotiate earnest money on an assignment deal. So again, like how we want buyers that are buying assignment deals for us to put some skin in the game. So same idea with the builder, just couple more zeros at the end of that that earnest money. When that earnest money goes hard, it's seven figures, not five figures. You know what I'm saying? And so that's how you kind of help keep some of them honest. And dude, I I'm I want to make sure everybody's clear on this. I am not an expert. I'm not portraying myself as an expert in this situation. you like for people that follow me, you're literally going to get to see this unfold in real time. So, you're going to un you're going to see how we make this transition and and and it'll happen. And like you said, it's either going to change everything or we're going to start from scratch. And I'm good with either outcome, dude. And I started from scratch in 2012 when we were talking about that that down period of my life. And nothing will be ever as hard as that moment was for me. So when I look at like what starting from a new zero looks like, dude, I mean that's nothing compared to what we already did. So for me, uh, you know, I I'm focused on the upside and making sure that we get to where we need to go.
>> Incredible. What's your wife's name?
>> Jennifer.
>> Jennifer. And how does Jennifer feel about this?
>> She has always been my biggest cheerleader. Continues to be my biggest cheerleader. Uh, she she trusted me when I had zero track record. So, I think now the trust is even more because it's like, listen, like I I I know what I'm doing now. You know what I'm saying? And even if this is a new venture, I've got all of this background and experience and track record to to lean on, right? So, I think we're even better than we've ever been, Brent, because we've gone through all the ups and downs, dude. We've had people steal from us. We've had houses burn down. We've had, you know, partners get sideways on us. And we've lost hundreds of thousands of dollar. You know what I mean? We've done all of that stuff, bro. So, like now when we look at a new challenge, >> this isn't anything that we've ever haven't overcome. You know what I'm saying? So, like for me, it's just like I I don't I don't look at risk and challenges the way that I used to when I first got into the business. Now, when I feel like an obstacle or a challenge coming up, I've conditioned my brain to think like, okay, this is happening for a reason. And most likely what's going to happen is I'm going to learn something from this. So, instead of like feeling bad for myself or throwing myself a pity party, I'm just going to lean into whatever is going on right now and put my head down and let's figure out how to solve the problem. And the reason why this obstacle came up will become clear to me at some point later on down the road cuz it's been proven to me that that's how it works, man. So it it never makes sense to worry or be scared or have doubt about anything because I was the biggest worrier in the world, dude. I used to stay up at the beginning and I wouldn't go to sleep and I would we'd have one flip on the market and it'd sit in for 45 or 60 days and I would spin this story of, dude, that's it. I'm bankrupt. This house ain't never going to sell. We're done. My wife's going to leave me. I'm not going to see my kids. And it's so crazy like the the most important thing that I can suggest to a lot of the listeners that are you have to fix the story that's going on in your head because if you can't get this screwed on straight and you're constantly telling yourself a story that's coming from lack or hey man with my luck this is never going to happen then it ain't never going to happen dude you know what I mean and it's not you're going to get exactly what you think about and so it's just focusing on how do we get to where we want to go and putting all of our time and attention into into those type of activities.
follow-up question to how Jennifer feels about this. What is your weekly allowance she allows you now that she's the money manager?
>> You know what's crazy, dude, is she, >> you know, she's got to put some of the some some restrictions on it. Come on. >> We when when we had I I'll I'll say quote unquote problems in our life, a lot of them tied back to finances, which I think a lot of married people probably have similar things. That's when we would have the most friction in conversations, the most tension. And it's such a blessing, man, that I don't have to worry about I don't have to worry about money. If there is something that I want, then I just go out there and I get the thing that I want. And going back to like what we were talking about earlier, this these that transitional period that really changed me. You know what I mean? I always look through the lens of have we made smart investments? Are we in a sound financial space? Do we have the appropriate cash in the bank that we need to make whatever purchase it is that I'm thinking about making? Right? And because we've been so smart about these things, I I and and I don't all go out and like buy a bunch of stuff, you know what I mean? Like we're, you know, like we we're not going out spending like crazy. And so because we checked a lot of the boxes before, I think you can and deserve the ability to, you know, create the life that you really want to have. Like so for us, travel is a very big thing. So Jen and I because we spend so much through our business on all of the expenses and the the rehabs and all that stuff, we rack up I mean I mean literally millions of credit card points. So we travel once a quarter ideally and we take trips now all over the world, dude. And so we use those kind of moments where you know normally what would be a really expensive vacation, we offset a lot of that cost through rewards and then we get to go do something cool. We invest in our marriage and those type of experience are the things that I like more than having an allowance to be able to go get the thing that I want. And I get whatever things that I want too, man. In a responsible way, man.
>> Love it. What do you think you'll net on that land deal?
>> Uh 10 to 12 million net.
>> Yeah.
>> On one deal, dude.
>> I love it.
>> Yep.
>> I love it. Well, Jason, this has been incredible. I mean, what a story. I mean, this is this is the, you know, I would say a a good majority of people that I talk to um that that they kind of tell me the vision that they have when they're first starting out before they've even even done a deal. It's first do a deal, get proof of concept. Second, get consistency so that you could quit your job. Third, it is build a real business that you don't have to work in in it, you can work on it. And fourth is to do big things. Either build a big portfolio or do big projects, right? And for somebody to literally in the last 48 minutes step through and show an example of exactly,
>> brother, you've only been doing this for 11 years. Not even 11 years. I mean, you're coming, this is your 11th year.
>> 11 years in real estate. Now you're staring, you know, by the time it's your 14th, 15th year and it you're staring at a huge opportunity for a huge payday. Um, and just a great chapter in in the book of your life to talk about, you know, you did take the risk. You did go after it. You did you you did go into unknown uh areas of business in real estate and said, "You know what? I'm gonna just take massive imperfect action. I'm gonna figure it out. I'm gonna get the right counsel. I'm gonna I'm I'm I know how to recognize potential and um I'm going to take advantage of it and I got the support of my lovely wife. I mean, what a life, man.
>> It's amazing, dude. I'm so grateful, dude. It's uh I love how you how you uh described it right now. In the last, you know, 40 48 minutes that we've been talking, you can see the vision of somebody unhappy, really miserable in their life, sitting in their office, sitting in their cubicle in corporate America, having the vision for wanting to do more, but having no idea how to get started and all of the limiting beliefs and different things that hold most people back. And in 11 years, go on the run that we've gone on, dude, it's pretty crazy, man. And and I'm a a big believer in I don't think that I'm special. I I have and I'm self-aware enough to know the things that I'm good at. And I focused on those things. And I figured everything else out as I went and I layered that top on top of like an unrelenting work ethic and just working my face off. And when you have those two things together, dude, uh you're hard to beat, man. So that that's what that's what's worked for me.
>> Awesome. Jason, we're going to put your uh Instagram handle here at the bottom uh or somewhere. Guys, make sure that you follow make sure you follow this journey if uh if this is, you know, I I would use this as fuel for your own dreams uh of doing really big amazing things because listen, there's nothing there there's nothing in Jason's DNA, nothing in his background, nothing in his circumstance growing up and you know giving a millions of dollars. I mean, this is all self-propelled and should inspire everybody. It certainly inspires me and uh so make sure that you follow his journey on his uh I assume you're posting it to Instagram and uh and and give him give him some love if you've heard this and and you just want to say something awesome. Put some good vibes out into the into the universe. Make sure you reach out to him and send him a DM and tell them thank you for the podcast and uh certainly Jason, thank you for joining us on the Wholesaling Inc. podcast.
>> Appreciate you, bro.
>> See you, brother. Thank you for joining us for another podcast episode. My name is Brent Daniels, Mr. TTP, Mr. Talk to People. And if you got value out of this, please subscribe to the YouTube channel, the Brent Daniels YouTube channel. And if you could give us a review on any of the podcast platforms that really helps out and we we just want to know if we're doing a good job or not. So, if you could do that, that would be absolutely incredible. And that's it. I sign off as I always do, encouraging you to go talk to people. Love you. See you next time.
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