Why We Fail to Scale Our Real Estate Business

Mike: This is the flipnerd.com “Expert Real Estate Investing Show,” the show for real estate investors, whether you’re a veteran or brand new. I’m your host, Mike Hambright, and each week, I bring you a new expert guest that will share their knowledge and lessons with you. If you’re excited about real estate investing, believe in personal responsibility and taking control of your life and financial destiny, you’re in the right place.
This is episode number 404 and my guest today is Gary Harper. Now, Gary and I have become very good friends and I respect him tremendously. In fact, so much so that I recently asked him to start consulting my businesses. And he’s really helped in a big way. Gary is an expert at the business process and design. Yep, not too sexy but it’s really critical for your business and, ultimately, for your own financial well-being and for the wellbeing of your family. If you’re stuck doing everything yourself, you’re putting yourself at risk. You’re not going to be able to grow and your family could be at risk as well. Many investors, even if they achieve some level of success, end up being self-employed. They don’t own a business, really. The business owns them.
So if you want to get out of that rat race, if that’s where you’re stuck, then you need to listen to today’s show. We talk about why most real estate investors fail in scaling their business and end up trapped. We’re also going to discuss how to avoid this if you’re just getting started and, also, how to change the situation if that’s where you find yourself. It’s going to be a great episode. Please help me welcome Gary Harper to the show. Gary, welcome to the show.
Gary: Hey, Mike. How are you today?
Mike: Good. I’m doing great. How are you, my friend?
Gary: Awesome, man. This is a great time.
Mike: Yeah. Good, good. It’s funny, I’ll just share with people that are listening here, right before I hit Record, people can probably assume that before I hit Record, we were talking here for a little while, getting ready and catching up a little bit as friends. But I just said that I’m grateful that I feel like I probably get more of your time than most people because we’ve become fast friends and have a lot of common interests and common core values and stuff. So we’ve been talking quite a bit lately.
Gary: Yeah, absolutely. It’s weird. We haven’t known each other really long, but I feel like I’ve known you a big portion of my life already.
Mike: You know what’s funny? Literally today, I don’t know if you saw this, I kind of ignore these things, but today, I literally saw on Facebook where it says, “You’ve been friends for one year.” So apparently, we’ve been Facebook friends for one year. And I saw it and I was like, “Only a year?” That was kind of surprising to me.
Gary: That is a surprise. I would have thought three or four years, right?
Mike: Yeah. Well, that’s just how long Facebook can track us back together. So it’s not everything.
Gary: Yeah, no. But absolutely. I really enjoy our time together. Thanks for having me on the show, man.
Mike: Yeah, it’s really good to see you. So today, we’re going to be talking about a lot of real estate investors and people that have been around, listening to me for a while, they hear me talk about this all the time, is that a lot of real estate investors fail because, truthfully, they give up too early. They never really kind of treat it like a business and they fail quickly. Which failure means they never even bought a house, I’m saying. Probably nine out of 10 people want to do it, but they never do anything. But then, even those that are successful, this is going to be the foundation of what we talk about today. Really, what happened is even if they’re achieving some success financially, more often than not, they’re self-employed. They’re still doing everything. Probably working harder than they did when they left the job that they hated, right?
Gary: Yep.
Mike: Yeah. So today, guys, we’re going to be talking all about why we fail to scale. We get into this business to own a business and, truthfully, most of us want to achieve financial freedom and we want more time so we can travel or spend more time with family. But a lot of real estate investors, even if they are successful, are still chained to their job and they can’t leave. So it’s going to be a good episode. Gary, hey, before we get started, for those that don’t know you as well as I do, tell us a little bit more about you and your background and how you got to where you are today.
Gary: Oh, yeah. So I started out at a very young age. I actually got married at 19 years old, 20. And by the time I was 22, I was the national manager of business issues and development in Chicago. I oversaw numbers of employees and systems and processes for an outsource company. And then ended up getting bought out. The company ended up getting bought out and I ended up working for Canon. And it was a business services division for Canon for a big portion of my career.
All in all, it was about 16 years in corporate America and upper management. And I oversaw hundreds of employees. A couple million dollars a month in revenue and really got dialed in with systems and process people and management. In 2004, I started buying real estate, working with my brother-in-law, Wayne Shaeffer and had a bunch of rental properties. Just started a rental management company. And then, 2011, I left corporate America, finally, and went full-time and worked with my bro-in-law, Wayne, and were able to scale that business to over 1600 deals. Did 300 deals in 2016, 100 deals in 100 days.
At the time, you may know Tom Olson too. Tom Olson was a part of that group. And then a number a number of people. Obviously, when you do that kind of thing, it’s not one person. Everybody brings collective genius to the mind of everybody. It helps, really, each other strengthen their weaknesses. And mine, what I was able to bring to the table was systems and processes. Equal systems and processes.
And so Wayne brought the vision and Tom brought the hustle. And we were able to slay it together. It was fun times. Just recently, in the last two years, stepped out. Started helping other real estate professionals scale their businesses away. And I helped Wayne and got into helping people with their systems and processes.
Mike: Yeah. That’s great. And obviously, you’re helping my team now. So it’s interesting. I talked about it. I was actually on somebody else’s podcast today and he said, “Can you share your . . . if you leave a legacy, can you share some of your values with us?” And I was like, “Well, actually, as you say that, I have my core values defined right here.” So Gary’s kind of a process and systems expert and he works with a lot of real estate investors to help them.
It’s not like I didn’t have values before we went through this a few weeks ago. But they’re more clearly defined. And if you had me list out what my values were, it probably would have been a list of about 20. And now, we’ve kind of summarized it down to the most important four, which is the underpinning for everything that we do in our business. But we’re very . . . probably a lot of people that I know, a lot of people that I’ve coached and mentored, they think we have a very systematic approach and lots of processes to everything that we do. But we decided to take it to a whole other level by working with Gary. So let’s kind of get in here, Gary. What are some of the reasons that people fail to scale the business up and they just kind of get stuck in a rut of doing everything themselves?
Gary: Yeah. I love how you framed that too. Because, honestly, when people leave the corporate world or jobs, they really don’t expect to get into another job. Essentially, what they do is own their own job at this point. And we really want to move them into business ownership or owning a system instead of owning a job. And the reason why we get stuck or we hit that ceiling or get frustrated is because three or four reasons, really, I have found. One is fear. Fear is the first one. Second is the wrong mindset. People just don’t have the right mindset for what they need to do.
And then lack of connections. Sometimes, they just haven’t opened the right door. And the last one is systems and processes. And that one sounds a little cliché because of what we just talked about, but it truly is still the way it is. There’s no way that we did 100 deals in 100 days in 2016 without the right systems and processes. They have to have those things as well. But fear, mindset, connections and processes and systems are what I have found are the main four culprits to why we fail to scale.
Mike: So let’s dive into these. So the fear part, what does that mean? That sounds kind of counterintuitive. A lot of people are afraid to stay working in corporate America or working for the man or stay doing somewhere. And they feel relieved to be out on their own. But then the fear sets in, right? What is that? Tell us about it.
Gary: Well, fear drives us in a lot of different ways. It drives us down different paths. It’ll drive us down different roads. And it’s funny because I always thought people would be more fearful of failure than they would success. But studies have shown people are more fearful of success and what that looks like than failure. And so it holds us back. It’s like, “Well, what if? What if I tried this and it didn’t work? And then, but more importantly, what if it did work? What would that look like?” So they get fearful of different things.
And sometimes, it’s not knowing. And mainly, what it comes down to, it’s what we don’t know. Fear is all about the unknown. It’s got really nothing to do with the result, failure or success. We disguise it as those two things. But, honestly, what fear comes down to, it comes down to the unknown. And I tell everybody the more you understand about what’s going on, the better you’ll feel about it. I’m scared to death to fly. I’m just going to throw it out there. I hate flying. And, man, I am . . .
Mike: You fly almost every week. Yeah.
Gary: Every week. Seventeen hundred flights. And every time, I have a ritual. I touch the plane, I ask for prayers.
Mike: Are you kissing the ground?
Gary: Oh, man. It’s so weird, right?
Mike: I didn’t realize that.
Gary: So I’m throwing it out there for everybody today. So why is that? Because I don’t really know what’s going on in that cockpit, man. Now, if you bring me up to the front of the plane, I’m good. I’ve flown before in a single-engine plane with the pilot next to me. I’m good. That’s not scary at all. Loved it. And it’s just because I don’t know what’s going on. It’s just probably a little bit of control. And I have found the more areas that I have fear in are the same areas I have lack of knowledge in. And so the way we overcome fear in anything is knowledge. We have to replace fear with knowledge.
Mike: Are you looking to change your life through real estate investing? If you’re interested in either getting started or taking your business to the next level, please check out FlipNerd’s Real Estate Investor Coaching Program at flipnerd.com/coaching. I’m Mike Hambright, founder of flipnerd.com. I’m not only a successful real estate investor that’s purchased hundreds of houses directly myself, I’ve been a mentor and coach for real estate investors for over eight years. In fact, I’ve mentored hundreds of other investors, many of which started with little to no prior experience. And during the time that I mentored those specific investors, they purchased over 3500 properties.
We have limited access in our program on how many people we can work with at a time. If you’d like to learn more about our FlipNerd Real Estate Investor Coaching Program, we’d like to schedule a call with you to see if you might be a fit. If this sounds exciting to you, please visit flipnerd.com/coaching to schedule a call with a member of my team. We’re looking to change lives through real estate investing. I’ve worked with many, many others. If you’d like for us to consider you, please go to flipnerd.com/coaching to get started.
Gary: So I’m throwing it out there for everybody today. So why is that? Because I don’t really know what’s going on in that cockpit, man. Now, if you bring me up to the front of the plane, I’m good. I’ve flown before in a single-engine plane with the pilot next to me. I’m good. That’s not scary at all. Loved it. And it’s just because I don’t know what’s going on. It’s just probably a little bit of control. And I have found the more areas that I have fear in are the same areas I have lack of knowledge in. And so the way we overcome fear in anything is knowledge. We have to replace fear with knowledge.
Mike: And for a lot of people, I’d say in a market like today where . . . it’s a different market now than it was a few years ago. It’s a seller’s market, a little bit harder to buy, a lot more competition. I’ve found there are a lot of people that keep doing things the way they’ve been doing them, mostly out of fear. They’re like, “Well, I know this worked. I just have to keep doing it.” And you’re like, “Well, it’s not working.” Pun intended, cheesy cliché, “Somebody moved your cheese.”
Gary: Yeah. No, that’s true. I actually teach a class called “Change Management.” And part of the change management class comes from the book, “Who Moved My Cheese?” Still, it’s the same concept. It still comes back to fear. Like you said, people get stuck where they are. They get comfortable. They get stuck where they know what they do. So when the market changes, the reason why so many get swept under the rug at that point is they don’t change. And they don’t change because of the fear. It’s like, “Well, what if? What if I do change and it doesn’t work out?” So we have to replace the fear with knowledge.
What is so important, in my experience, is staying up on this ever-changing industry. This industry changes way too often. When we do planning sessions, vision plans, I don’t like to take it any farther out than two years. I don’t mind setting a really big goal 10 years, 20 years down the road, but I don’t like to really plan at ground level more than two years, especially in real estate, because the industry changes way too much. And we talk about that know as you’re replacing fear with knowledge.
And, man, I tell you, there is so much information out there today in this day and age. You’ve got podcasts like this that you can stay abreast of things that are going on and get knowledge on. You have books, you have eBooks, you have magazines. I’m a part of the Think Realty platform and I write weekly in the “Think Realty” Magazine. So it’s something you can do. There are blogs, there are quick tip videos. Honestly, there are a lot of things.
This is going to sound . . . a reason I joined your mastermind. We’re a part of your mastermind. The reason I joined it is knowledge. You want to stay abreast of everything going on as the market changes, especially when you’re in the central part of the United States. It’s really cool where we are in northwestern Indiana because everything seems to happen on the East and West Coast first and I can stay informed and ahead of that. And it really helps keep me moving forward and doesn’t let that fear cripple me. That’s why it’s so important.
Mike: Yep. So let’s talk a little about the wrong mindset. And I think you’re probably going to say . . . some of the things we’re going to talk about here are that a lot of people want to build a business, but this is probably heavily tied to fear, but they get out and they just feel like they can do everything themselves, like they can do it better than everybody. But anyway, I don’t want to take words out of your mouth. Let’s talk about having the wrong mindset, as it pertains to not being able to scale.
Gary: Tom Olson’s a good friend of mine and I hear him say a lot, “When you change what you think, you change what you do.” And I think that’s a really good statement. We have to start to change what we think. You have to start believing more in yourself. You have to start believing. And this goes to the people out there that get complacent. They have to challenge that complacency. The result of complacency is death: the death of business, death of growth. It’s a destroyer.
We have to constantly challenge ourselves. If you don’t believe or are ashamed of who you were 12 months ago, then you’re not challenging yourself enough. You don’t have the right mindset. You ought to look back 12 months ago and go, “Man, I’m just ashamed of who that person was. I’m ashamed of where that business was. I’m ashamed that I hadn’t done more at that time.” But that’s a good thing. You should be ashamed of it.
The other thing I tell people is . . . somebody once asked me, they’re like, “Who’s your hero. Who do you look up to?” And I said, “Me, 10 years from now,” because I need to have that mindset. I need to be thinking always 10 years ahead and going, “Boy, that’s where I want to be.” And if you have that right mindset, then I’m going to drive myself. I’m going to push myself to the next level. It’s also about when we change what we think, we change what we do when we’re business owners. We’ve got to get out of our own way sometimes.
Sometimes, we cripple ourselves and we stop ourselves right in our tracks because we stay working in our business all the time. We never let go. And we never take time to actually work on our business. So proud of you lately. What you’ve done with your business and now looking at the business from the top down and seeing what seats you need to pull yourself out of and delegate and elevate yourself to another level, boy, that’s the right mindset.
And that’s the kind of stuff right there that allows us to have the traction to really grow our business is when we realize, “Hey, I can’t be everything to everybody. I can’t be the cook and the dishwasher. I’ve got to be able to let go of some of this stuff and allow the business to take on a life of its own, allow the people to be empowered.” We grow tremendously when we empower people.
Mike, I am one of these people that I could not work in an environment where I’m not empowered. Good people don’t stay in an environment that’s not empowering. They want to feel empowered. They want to feel like you trust them and you let go. And that’s one of the things.
Now, the other things that I feel like really hold us back, as entrepreneurs, is not communicating and documenting our vision, not getting what we think, getting it out of our head and on paper and then communicating it. Because we can’t get people excited around us because we haven’t told them where we’re going.
Mike: Yeah, absolutely. As you know, we just defined this in our business. Just to kind of be a little open here with what we’ve been doing. A lot of stuff was in my head. And I have these goals in my head and I think I have been going through some changes, just mentally, like you said. Or just like, “Hey, I can’t . . . ” for a lot of people that know me, that know me really well, know that we work hard. We work hard. We don’t have to work hard, but this is who I am. I’m a hard worker.
I’m about to go on vacation here in a couple days. We’re going to Mexico and, truthfully, I’ll be bored out of my mind on day two or three. And so then I spend the rest of the trip drinking fruity drinks and trying to relax. But my butt’s always burning. I’ve got to be doing something. But I’m getting better at that and I know that I can’t always work that hard.
And back to getting your goals out, though. We went through this process with me and my team to where I kind of laid out two plans. I’m like, “Guys, we can take the easy path here, which is a pretty good path for us. We’ve got some really good things working. We feel like we’re really impacting the industry and impacting some people in a positive way. Or we can take the hard path, which is harder, but we’re going to impact even more people.”
It took me . . . I’ve never had that discussion with my team before. I’ve always just said, “Here’s what I want to do.” And literally, I laid it out. And in my mind, I’m like, “I’m okay with the easy path if you guys are okay with that.” And they said, “No, no. We want the hard path. We’re willing to do that.” But it took getting their buy-in and getting them to say . . . now it’s not just me. I’m excited for them, too, because taking that hard path, honestly, creates a lot of opportunity for them as well, financially and just from an accomplishment standpoint. If we pull off what we’re trying to pull off here, everybody can celebrate.
Gary: Right. And what was cool to watch was them feel empowered. But, more than likely, they didn’t feel pulled along anymore. They felt like they were running with you. It was a complete change of mindset, not just you but your whole staff. And it changed what they thought. We have to, as entrepreneurs, stop doing those $10 an hour tasks. We’ve got to start letting that stuff go, letting the people around us feel empowered to do it.
Start leading, not managing, people. Not just micromanaging management, but actually leading them. And what you did was the true example of leadership. It’s like, “Guys, this is where I’d like to go, but where do you guys want to go?”
Mike: Yeah. And I think part of that process and, hopefully, what people are listening to here is not just Gary patting me on the back and me patting myself on the back. But for you, it was this . . . for people that are listening, it was a transformation of me getting buy-in from people that, truthfully, when I empowered them that way, they started to say things. You even heard it on our . . . you were on our meeting yesterday where one guy on my team said . . . I’m kind of saying, “Man, I’ll do it. I don’t know when I’ll get to it.” He said, “Let me do that!”
And people started taking things away from me, which is good because I’ve held it way in for too long. I’m the CEO. We call it Chief Nerd around here. I’m also the chief bottle washer when I need to be. So the more I can get myself out of that role and the more I think my team . . . and for people that are listening, put yourself in that situation. The more your team buys in, the more responsibility you give them, truthfully, the higher you’ll fly and some of this stuff will start to come off of your plate.
Gary: Yeah. Delegating that kind of stuff. And I tell people this. You ought to start to delegate tasks that others can do 70% as well as you. Honestly, Mike, this is your business. And if you’re listening today on the call, watching, you are not going to find somebody that’s going to do it and have the passion you have for your business. That’s not going to happen.
I mean, Gary V. says that when you listen to his episodes, right? He says, and I believe this so wholeheartedly, “Ninety percent or better, that’s going to be a rock-solid person for you.” And you’ve got to be willing to let go of those things and empower people to do that. And that’s one of the reasons why we fail to scale, is just we won’t change the way we think.
Mike: So the next one is connections. Let’s talk about connections. We talk a lot, I talk a lot on this show about the power of my network and the importance of your network. And honestly, honestly, honestly, not to use some cheesy cliché, your network is your net worth, which I believe. A lot of people say that. I think we’ve actually done it here because I’ve got a relationship with you. This is episode number 404. We’ve had hundreds of people on the show that I’ve built relationships with.
I had dinner with Gene [Greno] last night and met with a whole bunch of people at our mastermind a few weeks ago. And these relationships have helped me take my business to a whole other level. But even if you’re an individual wholesaler in a market in the middle of nowhere, your connections are everything for you, right?
Gary: Yeah. I mean, and not only the connections you have, but what are you doing with those connections? I mean, it’s . . .
Mike: A stack of business cards doesn’t help you if you don’t know how to use it.
Gary: Yeah. I mean, sometimes I’ll give a speech and I’ll talk and I’ll say, “You know, it doesn’t matter who you know, but who knows you.” And so the connections, your network being your net worth, all that, that’s really important. And it’s good to know people, but it’s also important to have a good name with other people too. And I like to ask this question. This is one of the reasons we fail to scale. It’s that we don’t put our network to work.
I love to say, “Have you thought about what your connections are doing for you?” What occupation do they have? When somebody thinks of Mike Hambright and then they think of somebody else, do they think automatically, “How can I connect those two people?” You got an email from me last night, right? And it was a gentleman in Tampa that I thought would make a good counterpart for you in something you’re looking to do.
And it’s like, “Hey, let’s make this connection. Why? Because you’re in my network.” And this other gentleman, Joe Dylan, is in my network. And it’s like, “Hey, let’s connect these guys.” Why? Because I’m working for them. Mike, my network of them is working on their behalf. And honestly, that is powerful. Right?
Mike: Oh, for sure. It reciprocates too, right? I’ve introduced you to people and you’ve gotten some things out of there. One of the things that I started to do early on when I’m interviewing people, and I’m saying this in a way and, hopefully, people aren’t saying, “Well, these guys are just talking about themselves,” no, we’re talking about what you can do. You can apply some of this.
And not that I’m . . . I’m definitely not perfect. But some things that I’ve done well is I often ask people right now . . . people come on the show all the time and they spend time with me. You’re spending time with me right now. I know you’re not even in your . . . you’re not even at home. You’re on a business trip right now, helping other clients. And you stepped out to be on the show here. And so one of the things that I often ask people, and I would encourage listeners to do this too, is when you meet somebody that has some influence, try to help them.
Try to give first. Just say, “What can I do for you? You spent time with me here today. I really appreciate it. But what can I do to help you?” And sometimes, people are kind of caught off-guard by that. Honestly, it’s so rare, unfortunately, that you will catch people off-guard by it. And just the fact that you offered to do that . . . and, of course, you need to really mean it as well. But just the fact that you offered to do it often catches people off-guard and it makes them want to help more, open doors for you or do business with you or whatever it might be. So don’t just build your network. Try to serve them. And then we all know, we know this for sure, Gary, the more you help others, the more you’re willing to help others, that’s going to come back tenfold.
Gary: Absolutely. I’ve had on my wall, it says, “If you help enough other people get what they want, you’ll eventually get what you want.” And that’s what it’s all about. Honestly, if you can over-deliver value and not expect payment in return and you’re doing that for your network, boy, you’re going to have people out there looking out for your back as well. But you said earlier, first, it takes building the connections.
So we actually have to get out there and build the connections. We have to go to meet-up groups, REI groups, masterminds, boot camps. I don’t know if you have many of those. And that’s a great way to build that network. And then, the second part comes in. Now, you have to actually deliver value to that network and, in return, receive value.
So the last one that I really feel is a thing that holds us back is really the systems and processes, Mike. And you could have all those other three. You can replace fear with knowledge and you can have the right mindset and you can get the right connections. And now, the door is wide open. The phone’s ringing and business is flowing in and you could be dropping the ball. You can let that stuff fall apart. It’s so important for me to know that we have the right systems, the right processes.
And that includes vision, that includes planning ahead, having goals laid out ahead of you. It includes all that. But it also includes your processes. It includes documents, documenting your core processes. And once we do that, we get those out, laying them out and really making sure they’re dialed in and then communicated to everybody on our team. And everybody’s following them and we’re holding them accountable. Some pretty amazing things start to happen.
Mike: Yeah. And these are all tied together, right? It starts to eliminate some of that fear because now, sometimes what happens is if you don’t have systems and processes, one thing, for example, is if you have a person that is on your team that is not the right fit for you, you have this fear of replacing them because it’s going to be a huge pain in the butt for you to train that next person. So I’ll just give you a real-time example, literally.
We have a bookkeeper on our team. She’s been with us for almost seven years. Awesome, we have a great relationship. She’s always been part-time and she just took on a full-time job for the first time in a long time. So she’s leaving. But we have our processes, not that there’s always room for improvement, but we have what she does in checklists, exactly how to do things. We use Asana, as you know. We’ve got things just very detailed as to how to do this. Every Wednesday, do that. Once a month, do this to tell exactly how to do that. Even with some videos.
And we started interviewing some candidates today, might have found somebody good. So we know that transition will be a lot smoother. So when we found out she was leaving, we were upset about it, but we were like . . . in the past, we would have been like, “Oh, my God. I’ve got to drop everything and focus on that.” And now, truthfully, we even have systems and processes where they apply to our ads. It goes into Podio. We do a personality profile all inside of Podio.
So we have systems of people applying, from an HR standpoint, that make it easy for us to find candidates. Then, when we start to onboard them, again, not that there’s not room for improvement here, but historically, we’re like, “Send your résumé to this email address.” And I’ve got hundreds of those to sift through, which is a pain in the butt. So anyway.
Gary: No, I mean, it’s pretty dialed in, actually. It’s pretty impressive. But if you’re sitting on the call, thinking, “Man, how am I going to do all that? How am I going to do all of that?” you don’t have to go to that level.
Mike: No, we don’t. We didn’t start that way, that’s for sure.
Gary: I mean, if you’re out there, solopreneur, you’re just getting started, you’re trying to get out of your own way, don’t let us freak you out a little bit by saying you’ve got to get all of this done. You do. I’m not saying you don’t. I’m not saying you don’t have to get it done, but it does take time. It takes . . . what I usually tell people, because this is where people get a little freaked out, “What do I do? Where do I start? Do I document everything?” And I just tell them, “Listen, start with your core processes.” Your six to 10 core processes, document them. Get that foundation going first.
And if you’re on the call today and you don’t know what those are and you’re in real estate, let me tell you what they are. They’re really simple. Your marketing for leads process is one of them. Get that documented. Your vetting the lead process definitely has to be documented. There are some operational processes like acquiring the property. You have to get that documented. Your wholesale process if you’re a wholesaler, that’s got to be documented. Or you’re a fix-and-flipper so you document your fix and flip process, the time acquired to the time it’s ready to be documented.
And your buy and hold process if you’re a buy and hold guy, a rental guy or a lease option or even a turnkey, you’ve got to get that process down. Then it comes into marketing for the sale process, whether it’s retail or wholesale, whatever. Everybody has a marketing for sale process that they have to identify and then document. And then the last really one process, but it’s broken down into two is your closing process, you’re a to B closings and then your B to C closings. If you guys would just start there, identify the bookmarks, the beginning to the end of those processes, get those out of your head and onto paper . . . and they don’t even have to be perfect yet, Mike, right? Just getting them out there, right?
Mike: Yeah. The funny thing is as long as you’ve done one deal, you’ve followed a process for all of this already. Now, it might have some room for improvement, but sometimes we just start doing things in our business and we know what to do, but it’s in our head. And I think just going through the process of sitting down . . . and we use a tool called Asana for task management. You could use Excel or Word, whatever you want. Just get it on paper. You can use a legal pad if you want to.
But, truthfully, technology’s a little bit easier because you’re going to think of something that you missed and you can go back and add it. Just think of, “Well, then I do this. Then we do that. Then call this person. Then put the lockbox on the door.” Whatever it is. We have defined processes that we do over and over again. You’ve just got to get it out of your head because that’s the first step of getting out of your own way is now you’re going to teach somebody else how to do it.
Gary: Yeah. And there’s no way to really delegate and elevate yourself to that next level and replace yourself in the positions if you don’t have this documented at least so that you can . . . we use it for multiple things. We use it for training, we use it for efficiency, we use it for client commitment, turnaround time, things like that. So it’s used for so many different things. It’s essential. If you’re a solopreneur, entrepreneur our there and you’re looking to actually scale to the next level, I’m going to tell you, first and foremost, what you’ve got to do is you’ve got to get your vision documented.
Number two is you have to get your systems and your processes documented. Get those two, first and foremost, out of your head and on paper. And then things are going to start to fall into place for you. But without those two out of your head and on paper, you’re not going to scale properly, you’re not going to have the greatest of employees. You’re going to have very high stress levels, you’re going to micromanage.
It’s going to be very complex in your business. You’re not going to hire and delegate. You’re going to hire and then people are going to be very frustrated around you. And the training’s not going to happen properly. So you’re going to have single points of failure throughout your own business. And it’s just going to lead to one thing and one thing only: frustration.
Mike: Yeah. And even if you’re brand new, I want to say if you’re a solopreneur right now, it doesn’t mean you need to somehow convince yourself you need to go out and hire five people in your business. You’re not there yet. But even if you just go from solopreneur, one-man, one-woman band, to hiring a VA. I mean, one of the things that I’ve found that . . . we have several Vas on our team, that I teach people, too, is there are, undoubtedly in our real estate business, there’s a ton of administrative burden, lots of little things that have to happen.
But it’s the type of things, truthfully, probably 60% of our business could be done by a VA if they have clear directions. You don’t have to have some high-caliber executive assistant, necessarily, certainly, when you start. But just some of those little things, like do this and do that, file this paperwork, put this in Dropbox, have your pictures put into Dropbox for your property, list your property on Craigslist and on FlipNerd. And if you’re wholesaling, all these other sites. A VA can do all of that. You just need to show them how to do it. And those little things are not . . . they’re generally not the fun things in this business. And so getting that off your plate, if you just start there, will probably cut your workload in half.
Gary: Yeah. You know, Mike, as a solopreneur, we do a little exercise where we list out everything we do throughout the day. Once we list it out, we put it in four . . . well, I call them five boxes. The first box on the top left is everything you love and you’re great at. The next box on the top right is everything you like and you’re good at. The bottom left box is everything you don’t like, but you’re still good at.
And then I’d ask if you’re really good at it if you don’t like it, but you don’t like and you’re good at. The next box is you do like it, but you’re not good at it. And then the very last box is you don’t like it and you’re not good at it. And then you take everything you listed out that you do throughout the day and you put them in those different quadrants.
And once you stick them in those boxes, it’s really easy to hire now because you just created a job description on everything that’s in the bottom boxes, everything that you don’t like or you’re not good at. And once you do that, then you can bring somebody on that actually likes it or is good at it. A VA is nine times out of 10 one of those people that can do those types of things. Because, usually, as solopreneurs, we don’t get bogged down in the transaction-based stuff. It’s brainless. It just doesn’t challenge us.
Mike: Yeah. Your time’s better spent finding ways to get more deals, raising money or, God forbid, enjoying your life more. Going golfing or going to the movies more. Whatever it is.
Gary: Yeah. So if we can just do that and get rid of this stuff, the low-hanging fruit stuff that we just don’t like, that’s a great job description for the first person we hire.
Mike: Yeah. For those of you that are listening right now, I like to put in some action-oriented stuff. What do you need to go do? If some of this is resonating with you, if you’re like . . . let me give you two examples here. If you’re like I was, a corporate guy and you’re kind of tired of working for the man, you don’t know how safe your job is, let’s be clear. Your job is, generally speaking, not safe. You could find out tomorrow that you’re going to lose your job. Not to scare you, but you just don’t have control.
So you’re in a business that you don’t want to be in anymore, working for somebody else. And you don’t really see the opportunity that you once thought was there and you want to get into real estate investing. Or you are doing deals right now and you’re stuck. As we kind of talked about, you’re a solopreneur, where you’re doing everything yourself. I think a clear path is to start to document. What do you do next, how do you kind of get out of that situation is to do a lot of the stuff that we’ve talked about here today. But I think the exercise that you just talked about there is to define what it is that you have to do.
Just list, like you said, everything that you do. “I have to get the mail. I have to answer the phones. I have to order my direct mail every month. I have to determine what list to mail to. I have to set my budget.” There’s a lot of stuff that we do. But once you start to lay out, like you said, that quadrant of what do you like to do, what do you not like to do, what are you good at, what are you not good at, essentially, then you start to find the stuff that you hate to do but that has to be done. And then you find somebody else to do that first, right?
Gary: Yep. And then you can even go one more step further. And when you look at that list, kind of put a checkmark next to everything that you feel like drains your energy. We start to . . . and that really defines it even further. You’re breaking down the stuff you don’t like to do, but what’s really important to get off your plate is the stuff you don’t like to do that actually drains your energy from you as well and makes you tired.
And if you can do those things, if you’re just making it really simple, just those things off your plate and get them onto a VA, boy, that’s going to be huge for you. It’s going to allow you to really resonate with that and spend time in an area that really helps grow the business to the next level. Mike, if I’m helping somebody, you know I help and coach a lot of people and Susan and I travel and help. If I’m helping people, I really need to help get their vision out of their head right off the bat. They’ve got to know where they’re going.
A vision without a plan, honestly, is like goals without [Inaudible 00:37:53]. It’s just a dream. That’s all it is. And so we can’t have that. We have to have a plan for our vision or it’s not accountable. So we have to get it out of our heads, get it on paper. And then start to document your processes, those core processes. So those should be the very first two things you do, get your vision out of your head so that when you do hire somebody, they know where they’re going. Number two, the processes so they know what they’re doing and, three, those quadrants so that you know what you’re hiring for. If you do those three in that order, you’re going to be a very happy person.
Mike: Yeah. It’s going to . . . for most people, it’s going to move you, certainly, beyond where you are today and it’s a great start to start getting yourself more toward business ownership than self-employed.
Gary: Definitely owning more of a system where you’re exchanging other people’s time for money instead of your time for money. And that’s where we . . .
Mike: And I know some people here that buy 40, 50 houses a year, that do everything themselves and they’re okay with that. In their mind, they’re okay with it. Here’s what I’ll tell you, is your family’s at risk. If you’re doing everything and something happens to you, and I hope it doesn’t, I’m going to knock on some wood here, but . . . in fact, you’ve had some things happen to yourself, right, Gary? If you don’t have a team to go take care of things while you’re recovering or while you’re dealing with that, unless you have a really high life insurance policy or disability insurance policy, your family’s going to suffer, right?
Gary: Yep. Absolutely. It’s going to be hard on them, it’s going to be hard on you and, whether or not you think it, it’s hard on you subconsciously today because it’s eating at you. And you have to be able to have a game plan. It’s like in business, we always coach people to have cash on hand, well, you have to have that insurance banked as well. You have to have something to fall back on. And this allows that. This is that insurance policy for you. With you out of the business, it allows the business to be in business and not you.
Mike: Inevitably, we’re going . . . I told you I’m going to Mexico here in another day. We’re leaving for eight days. Honestly, what happens every time I leave, my business does better. My team always jokes, “You need to leave more often.” I’m like, “Hey, that sounds good.” So, yeah, there might be some benefits there that you didn’t know when you get yourself out of the way.
Gary: You know, Mike, I used to tell people you measure your success as a leader not by the time you’re there, but by the time you’re not there. So the fact that you’re able to step away and it grows is a good attribute or a good compliment to the fact that you do it properly.
Mike: Well, I have a tendency to distract people in my company sometimes. I’m like, “Oh, everything’s running just fine? Well, let me throw something else on your plate that you didn’t know was coming.” So I’m trying to get better at that.
Gary: That’s good.
Mike: Yeah. Well, Gary, if folks want to learn more about this, every time I talk to you, every time you come to our mastermind and you’ve been very gracious with your time, not just with me but my team and people around us and our masterminds, stuff like that, people always want to . . . like, “I want to talk to Gary. How do I learn more about him?” Where do folks go if they want to learn more about you and your company and what’s going on?
Gary: Well, I have some videos on YouTube so if you want to watch some videos, you can do that. I’m also a Think Realty coach so you can go to thinkrealty.com and then go under Education and Coaches. And you can actually watch some videos there if you sign up for their free membership. But you can go to my website, sharperprocess.com. That’s sharperprocess.com and you’ll find out more about our services there.
If you want some freebies, obviously, there are some freebies there on YouTube and I give a lot there. And on Think Realty, you can go there as well. Pick up the “Think Realty” magazine as well. There are ones at every Barnes and Noble. I write in there. And the thing I’m looking forward to the most, Mike, is I have a book coming out in just a couple months. I can’t wait for that to hit the shelves.
Mike: Yeah, let us know when that hits the shelves and we’ll share it with our listeners as well. That’s awesome.
Gary: I appreciate that. Thank you for having me on the show today.
Mike: Awesome. Yeah, absolutely. Great to see you. Thanks for spending time with us. Everybody, this is episode number 404 with Gary Harper. You know, at the end of the day, we’re talking about some stuff that’s not so sexy, but it’s critical to your success, the success of your business and to the freedoms that you’re looking for. It’s important. So I often talk about that when I’m coaching and mentoring people. I’m like, “Today, we’re going to talk about the steak, not the sizzle. But if you can figure out how to eat the steak and kind of do the work, then you can have sexy later.”
But, everybody, again, episode number 404. We appreciate you. If you could, if you haven’t already, please go out and give us a positive rating on YouTunes . . . YouTunes. YouTube or iTunes. I kind of merged two things there. iTunes, Stitcher Radio, YouTube, anywhere else where you might be listening to this at. If you’re watching it on flipnerd.com, please share it on social media. We make that pretty easy for you.
That’s . . . the positive comments and the ratings and things like that are kind of the fuel that keep us going here. After 400 episodes, I’m not giving up. I’m going to keep bringing them to you guys. But show us a little love. We’d appreciate it. Everybody, have a great day. We’re going to see you on another upcoming episode. Take care now.
Are you looking to change your life through real estate investing? If you’re interested in either getting started or taking your business to the next level, please check out FlipNerd’s Real Estate Investor Coaching Program at flipnerd.com/coaching. I’m Mike Hambright, founder of flipnerd.com. I’m not only a successful real estate investor that’s purchased hundreds of houses directly myself, I’ve been a mentor and coach for real estate investors for over eight years. In fact, I’ve mentored hundreds of other investors, many of which started with little to no prior experience. And during the time that I mentored those specific investors, they purchased over 3500 properties.
There are a lot of so-called gurus and experts all across the country, most of which have nowhere near the level of personal experience to teach others how to build a successful and sustainable real estate investing business. Very few others have as much experience as I do, not only teaching others how to get started in real estate investing but also showing others how to truly build a real business with systems and processes and all the tools to allow you to consistently do deals so you have a real business, not just a hobby and not just a dream.
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