Ponder this for a second … the CEO’s of the largest companies on the planet (Google, Apple, GE, etc.) have the same number of hours in their day as you have in yours. We often get bogged down and wish there were more hours in a day, but until we crack the code on time travel, it’s not possible.
So, what’s a lowly real estate investor to do? Many of us left jobs to be ‘self-employed’, only to ultimately just have created another J-O-B for ourselves. True, different boss, but still a slave to the clock. Bottom line – unless you don’t mind working a ton of hours and have a significant cap on your growth potential, you have to build a team around yourself.
There are three primary reasons for hiring others:
- Capacity – There’s not enough time in a day for you to do everything you need to do.
- Competency – You’re not an expert at everything.
- Your Interests – You probably like some aspects of the business more than others.
Let’s break these down a bit.
Let’s be honest, a big part of why you became (or would like to become) a real estate investor is for more control of your time (in addition to financial freedom or opportunity). When you’re self-employed, it’s possible that you’ll have a lot more control over your schedule, but this generally is not the case if you’re ‘doing it all’. While we’re being straight with one another, let’s not forget that lack of capacity and limited growth are a recipe for burnout and failure. If you have to do everything, you probably have no control over your time at all. The phone rings, you have to answer. The house gets broken into; you jump in the car (or truck) and deal with it. Potential seller calling … yep, you again!
As a real estate investor, your time is generally best spent finding deals and building your team. There are roles needed in your business that require a high level of specialty. Even if you are a specialist in one area, you’re likely not in the other. From contractors to attorneys and salespeople to lenders … there’s no way you can do it all. And of course, there are certain trades that you have NO business even trying to do yourself. We’d never advise even picking up a hammer (you should be finding deals!), but aside from being an inefficient use of your time, you probably wouldn’t cause too much damage. However, unless you’re an attorney that specializes in real estate … don’t try providing your own legal services!
We all have things we enjoy doing, and more that we don’t. In fact, you may even hate some of the things you do. Let’s face it, as a small business owner, when required, you’re also the ‘Chief Bottle Washer’ and need to take the trash out. This doesn’t mean you should do it forever, and it definitely doesn’t mean that you need to settle for ‘this is just how it is’.
Why Did You Start Your Own Business?
It’s common for investors to naively learn that investing is actually a ‘business’. You need to check the mail, answer the phones, deal with code compliance issues, deal with a past due bill that you never knew existed, respond to complaints, deal with nosey neighbors, keep track of your bookkeeping and manage your cash, and a million more things.
That said, don’t forget why you went out on your own in the first place. I’m going to guess it was NOT to work more, and NOT to take the trash out. Where most investors (and all small businesses) fail, often comes down to inability to scale. You don’t need to be the next Google, but you do need to scale your business enough to be able to afford the help of others. You don’t need 100 employees, but you need a few, at least.
So, how do real estate investors build their team out? How do you find the right lawyer, lender, CPA, assistant (virtual or otherwise), contractors and more?
Bottom line – you need a trusted resource. Find people that come recommended by a reputable service or word of mouth from others you know that have used them in the past.
It’s also common to ‘decide’ to hire someone (of course, when you need help the most), but then get married before you’ve dated or done your research. It’s best to start the process to hire resources well before you need them. As the saying goes “Hire slow, fire fast”.
As a small business, it’s impossible to not feel the pinch of ‘limited resources’, especially if you came from corporate America … where you could simply call your “IT guy” if you had a computer problem. But, the benefits of self-employment are too great, as long as you crack the code on surrounding yourself with the right people!