This is episode #438, and my guest today is Brian Spitz.
Brian is the largest independent home buyer in the state of Texas, who has purchased over 3,300 houses, or about 400 per year. He’s also a fellow member of my Investor Fuel mastermind for real estate investors.
Most of us in major markets have been talking about the threat from large, well funded home buying companies coming into our markets, such as Open Door, Knock, Offer Pad, etc., but we’ve never discussed this topic on the show before.
Brian’s has spent more resources than anyone else I know learning about our competitors and how we can navigate around them…and that’s what our show is all about today. How to adapt to the changing market around us, and more about who some of these large competitors are.
More importantly, how you can learn from your competitors and not only survive…but thrive.
Please help me welcome Brian Spitz to the show.
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 438 and my guest today is Brian Spitz. Brian is the largest independent homebuyer in the state of Texas, which is also a big state who has purchased over 3,300 homes, about 400 houses a year. He’s also a fellow member of y Investor Fuel Mastermind for real estate investors and we’ve gotten to know each other over time. He is just a really smart guy. Now most of us in major markets have been talking lately about the threat from our large well-funded home buying companies that are coming into our markets. Companies such as Opendoor, Knock, Offerpad, and Zillow Offers. There are more and more. We’ve never discussed this topic on the show before for today.
So Brian has spent more resources and more thought leadership on this than anyone else I know in learning about our competitors and how we can navigate around them, and that’s what our show is all about today. How to adapt to the changing market around us with some of these large organized competitors? And really more about who some of these competitors are. More importantly, how you can learn from your competitors and these competitors and not only survive, but thrive. Please help me welcome Brian Spitz to the show. Hey, Brian, welcome to the show.
Brian:Thank you very much, Mike. How are you doing?
Mike:Good, good. Hey, I’m excited to talk about this today. Obviously, we’ve talked a few times. You’re doing some really innovative stuff that the average investor hasn’t even thought of yet. So you’re definitely on the cutting edge of investors in America for sure. I’m really excited to talk about what you’re working on. But also we have this topic that there’s a lot of mumbles going on across real estate investors about Opendoor and Knock and some of the big dogs that are coming in that are really well funded that are running a different business model than what we’re used to as investors. And it’s going to be great.
We honestly have . . . I’ve had that conversation 100 times with different investors, but we’ve never talked about it on the show before and I know because what you’re working on in your business and how you’re taking it to a whole another level that you have a pretty good idea of what each of these competitors are doing, and how we might be able to start to compete against them and kind of avoid them as much as possible. So it’s going to be exciting. Hey, why don’t you . . . before we get started, tell us a little bit about you and your background?
Brian:Sure. I am the owner of Big State Home Buyers. That’s the name of my primary company. And it’s a home buying wholesale focus company in Houston. We do some business in Dallas and San Antonio. And I’d say I’ve been doing that for 14 years, Big State’s about 11 years old, almost. And we’ve won lots of service awards and done over, you know, I guess it’s over 3,300 transactions now.
Brian:And figured out what doesn’t work when you’re scaling a business that’s wholesale focused. Done tons of rehabs and rentals and lease option and anything you can think of in residential real estate, we’ve done. And so . . .
Mike:Yeah, that’s awesome.
Brian:Yeah, we’re focused right now on kind of innovating and moving towards, you know, what’s going to work better tomorrow, kind of looking ahead of the trends coming into our business.
Mike:That’s awesome. That’s awesome. And to give a little perspective I know you don’t necessarily like to brag on yourself, but you’re doing over 400 transactions a year, generally thought of to be the largest independent homebuyer in the state of Texas, which Texas is obviously a massive state. So there’s a lot to be said for that. So congratulations.
Brian:Oh, yes. Thank you.
Mike:Yeah, yeah. But the thing is that what I want to point out here is, when you do the type of volume you do and you’re the type of organization that you do, you know, you have your ear to the ground, probably better than most, like a lot of smaller investors can feel it, they know things are changing, but you’re able to stay a little bit ahead of the curve because you have so much more to kind of protect and so much more maybe, I guess, capacity on your team to be able to be looking around the corner as what’s coming next.
Brian:Well, you know, we’re, I would say, one of my biggest core competencies is internet marketing. And we’ve done internet marketing since 2009. And that requires you to be so in tune with competitive trends to stay efficient and keep it manageable that, you know, we did a bigger push to work in DFW about a year and a half ago. And once, you know, I got a hold of seeing what it was like to compete against companies like Opendoor, I knew that it’s a matter of time before that becomes an enormous threat to your average investor.
And we at least put our heads down and spent the last year and a half preparing for that. And just I think it’s really important people to keep an eye on what other people are doing in this industry, and it’s something people get really egotistical and get focused on how good they are instead of what’s coming, you know, in any change in the market.
Mike:And it’s kind of interesting like, if I look back, I’ve been investing for about 11 years, I knew who . . . I usually, I would say my competitors either fall into one category. I know who they are. Like I know the individual like it’s that guy, you know, Joe or whatever. And then or there’s just this mass of the people that I don’t know who they are. It’s like all the independents that are doing a deal here and there.
Now, we have this kind of organized competition that’s coming into a lot of markets. Really well funded. Usually they’ve raised, you know, millions or hundreds of millions or billions of dollars even and it’s like this faceless entity that’s like this black cloud coming into our markets or that’s how we act, right? So who are some of these guys? A lot of people know Opendoor but who are some of the others involved?
Brian:A ton of them. We’ve got, just to name a few there’s: Opendoor, Offerpad, Homie, Bungalow, Knock, Zillow Offers of course is a decent competitor. I’m trying to look . . . ZHOME, Xome, Redfin. We do a lot of competitive. We’ve a war room here in the office that’s got a whole two walls dedicated to understanding competitors, their marketing strategies, their messaging, and their growth.
Mike:Okay. So what changed? I mean, there’s always movement over the last, let’s say, eight or nine years of the . . . This is what I used to think about the real estate investing market, I still believe this, is the opportunity that existed for us. Like guys like us when we started, right, was an inefficient marketplace, right? And now it’s getting more efficient because of guys like this. So is that what’s allowed them to come in and kind of make things more efficient, take advantage of themselves?
Brian:I think you’re talking about something very key, which is what we do especially as wholesalers is only made possible by inefficiency. Inefficiency where real estate agents can’t serve the market, and don’t understand the customers, and customers don’t have the access to the buyers that wholesalers do. So they’re able to contract wholesale and make, you know, these that are often out of proportion with the service we provide. And so it sets the stage for the threat.
But what the threat actually initiates is those years ago where all these hedge funds start buying. And so I can see even then that, you know, if I’m charging, $20,000 and the hedge fund is buying it, and then they’re fixing and renting it, it’s a matter of time before those people figure out like we don’t want to pay for $20,000. And with enough money, you can overcome pretty much any obstacle. And so it was a matter of time before funding made its way to people to get direct to sellers. And then that’s what we’re now is the result of institutional money wanting direct access to the sellers.
Mike:If you’re an active real estate investor already doing deals and looking to double or triple your business, you should consider joining the Investor Fuel Real Estate Investor Mastermind. We’re a small group of investors that share our best practices, tips, and tricks with one another in an effort to all win. We limit our membership to only one to two members per market so everyone shares their knowledge, tips, and tricks openly and honestly.
Our members include some buying one to two houses a month, up to some of the most respected investors and leaders in the real estate investing industry. Some of which have personally done over 1,000 deals. If you’d like to be considered for our invitation-only, world-class mastermind, please visit investorfuel.com to request your personal invitation. Our next meeting is coming up quickly, go to investorfuel.com now to learn more.
Brian: . . . with enough money, you can overcome pretty much any obstacle and so it was a matter of time before funding made its way to people to get direct to sellers. And then that’s what we’re seeing now is the result of institutional money wanting direct access to the sellers.
Mike:Yeah, yeah. And it started with buying from other wholesalers, like you said, then it went into . . . they got good at raising money for this, right? And they raise so much money, then most of them became massive national hard money lenders, right? And then they’re just working their way down to get closer and closer to that end user, which is where guys like us and, you know, gals as well have operated like going to the kitchen table buying from sellers directly, right?
Brian:Yes. And so that remains, as much as there are threats, there remain advantages that I think some we’ll be in tune with. And the other piece of it is, again, with inefficiency, the people that are writing the checks are making those investment decisions over on Wall Street are so far removed from the operational challenges of owning, managing and acquiring in reverse order, single family real estate that a lot of people get really caught up in like, Opendoor, for example, their model. You know, they’re real focused on, you know, how can you pay that much for house is just a matter of time. You know, I think that it’s a foolish mistake people get focused on why other models don’t work long term and don’t realize that people running these massive companies, they have other plans at work.
But at the same time, it’s true that, you know, like, we went to IMN this year, and some of the biggest challenges these massive portfolio holders are finding is how do you operate managing thousands of houses. You cannot get away from someone needs to paint the house, someone is going to live there and pay the rent and operate, you know, manage the broken windows, and there’s way too much human interaction or human need in it for operations to get rid of those problems. And I think that that is a long-term threat to our whole market actually is inefficiency. But make no mistake that people that are sitting around paying too much for houses know exactly what they’re doing.
Mike:Yeah, yeah. What are some of their models? They all have different models. Some of them actually buy the house as investors. Some of them just kind of arbitrage between the buyer and the seller. They’re all doing different things. What are some of the models you’ve seen?
Well, so Opendoor’s model is to create massive market share going into cities and spending millions of dollars a year thwarting probably even HomeVestors in their marketing strategies. And focused on getting out there and buying the home directly from the seller. They put lipstick on them, and they put some of them back in their own marketplace. But their biggest source of resale is through other investors. So they have their own online bidding platform that’s available to other buyers and institutional buyers kind of like rootstock. And so they’re selling the properties above market value to other greater fools in the Wall Street.
But the money is so bottomless that, you know, it’s really not a noticeable loss or making a difference. Then you have Knock, which I think is the most outrageously inefficient model where they will buy your new home, let you trade in your old home, fix up your old home, put it on the market, and then settle up with you at the end. It’s a like nine-step process, which is adding them and that is the worst model ever. And then you have companies like Zillow Instant Offers, which does some combination of testing, purchasing in some markets. But then also selling leads and things like that.
They give you this estimate on your home. They give away free information. Zillow is probably the most prepared to make a big impact in the market. And so and some of them I think there’s one called Door. The other one was Knock, so Door will list your home for a flat $5,000 fee. And so all of these models, though, the reason I don’t think we have seen the one that is the best for all consumers yet, because they’re still playing in the space of what is most frustrating sellers which is the open market. And so, yeah, I don’t think we’ve yet seen the one that’s going to truly devastate the marketplace as we know it.
Mike:What do think that is?
Mike:Okay. Awesome. So let’s talk a little bit about what people can do. Let me ask you this. I think a lot of us feel and, I mean, you and I haven’t talked about this. But the market is shifting, right? Aside from these competitors but just the macroeconomic market, in the U.S. of housing is slowing down. It feels like it’s started to slow down a lot of markets. No matter what market you’re in, stuff that’s higher price is slowing down usually, right? And probably some people are saying there’s a crash. I’m not saying there’s a crash. I’m not predicting that. But I think it is slowing down. I think there’s going to be a downturn in the cycle at some point, right?
Mike:So for a lot of these players that are coming that are super well-funded and we all know that just because somebody is really well-funded, I mean, if you were involved in any way or you remember the dotcom bust, there’s a lot of stupid money that makes bad decisions that gets wiped out at some point. So probably all these players won’t make it through a downturn moving on. But some combination of the market slowing down and more expensive money, right? Rates are creeping up. Like these guys tend to operate on pretty thin margins for the most part compared to the average investor, I would assume. Would you agree with that?
Mike:So changes in the market could really, really impact their model more so than guys like you and me.
Brian:So here’s how this is going to work. And so I know that you include some links and we’ll include a link to an article we just published in the “Houston Business Journal,” and specifically mentions a company WebVan from the late ’90s . . .
Mike:I was an investor in that. I lost it all.
Brian:Yeah. They raised $400 million, they were valued at over $4 billion, and then they were bankrupt. The reason is because when you play . . . we play in a time where information is so available that margins for large companies, they’re always razor thin. And so a handful of mistakes in a company’s business model takes it from super successful to bankrupt. And the going back to this idea that the people who run all these hedge funds are not in themselves experienced real estate investors. They make mistakes. Opendoor, you know, I look at their strategy. I’ve actually been through the funnel with them some. I look at it and I think if they would just move . . . that worked or just flip that number, it would make such an impact to their market. And it just goes to show you don’t have people that really understand what they’re trying to buy and sell.
And so that was really the biggest threat for them. Now as far as the market itself goes, you know, we do a lot of buy and holds. That’s part of our long-term asset development strategy. We take in private money. We combine it with private bank debt and, you know, so they’re all, you know, 20-year [am 00:16:58] loans with balloons. And the interest rates as we keep developing those borrowing relationships are picking up and you have companies like CoreVest that will lend you . . . I mean, interest rates there are a good bit over 6%. That makes a big difference in your margin from 4.8% to 6.3%. [inaudible 00:17:18]. It’s really from a macro level, there’s all these compounding issues. So you have money’s more expensive. You have millions of more dollars in advertising being spent by people with bottomless, you know, bank accounts.
So that starts to drive the cost of marketing up, push people who market out. You know, and the deals become more scarce. And then you have markets like DFW where the bottom of the market keeps getting absorbed, absorbed, absorbed. So the priciest homes that make the most sense for investors are no longer even available. You know, we’re in DFW where we sold a house a year and a half ago, it was worth $145 then it’s worth $190 now. You [can laugh 00:18:01] because there is no market for homes under 200. So everywhere you turn, it’s not good for the individual investor. It’s, you know, a crash or any kind of market corrections coming, yes.
It’s good, but doesn’t do me any good for the market correcting and a half million dollar price point. I don’t buy it and keep properties in that price point. And so it’s really a time where people need to investigate the best strategies. So if you’re in this forever, if this is what you want to keep doing, then modifying your business to see ahead of how these changes will all culminate over the next couple of years. You know, there’s always money to be made in real estate. So that doesn’t change. But how you do it will change.
Mike:Let’s talk about that. How does the average investor that’s listening to this show right now, and I’ll just tell you, we have, you know, thousands people a day that listen to the show. So it’s people that are brand new that are thinking about getting started. It’s people that are doing, you know, a handful of deals a month and everywhere in between. So talk to those people a little bit. How do they not be scared off by this, but say, “Hey, here’s an opportunity for me to do things differently than they’ve been done in the past.” So give us kind of some survival tips, if you will, on how to survive this threat.
Brian:I think the very first thing here to do is really understand whether or not you’re prepared to invest in getting in this business and staying in it. So, you know, when we hear people that say, you know, “I just quit my job and I’m going to go out and get an investment in real estate and I might put some money in the bank because it’s not, you know, it doesn’t take off in a day.” And I would avoid scale. So we’re somebody who’s scaled. We’ve had, you know, 20 something employees before. I’ve had two employees before. And the larger you get, the more razor thin your margins get and the more deals you have to do to survive. And so I would, you know, I hear people sometimes say, “I’m looking to get an acquisition team of 7 or 10 people.”
And now is not the time to be scaling like that. Now’s the time to be nimble and really get wise, keep the very best deals. For people that are bankable, you know, people that are able to build equity long-term, it’s never going to get . . . there’s never going to be more homes in the price point that are good rentals. So now is the time to hold some, you know. And then as far as investing and wholesaling and things like that. In marketing, what people miss is how the market has changed in the last 10 years and how the audience has changed. So every time I see somebody advertising about stop foreclosure and bankruptcy and all this, you know, mortgage companies haven’t been writing loans to people with . . . the bottom quarter of all mortgages are in a 625-credit score. It used to be like 550. And so they haven’t been writing bad loans for 10 years.
So there’s really little foreclosures left. And so that’s not the reason people sell to investors anymore. Yet, that is, you know, people harp on the wrong things. And so really understanding, you know, baby boomers are retiring and aging out and people are inheriting. And, you know, the reason that people sell, that’s really what we do very well is understanding the mindset of the seller and going after the homes that these large companies don’t. You know, these companies that focus on listing for $5,000 flat fee. Well, our sellers really don’t want to list. You know, so when someone has a pretty beautiful home on the market or about to go to market, just want to see their options, that’s not our seller. You know, Opendoor doesn’t buy homes, I think, pre-1960 or major foundation problems. They only close on 50% of the homes they contract.
You know, they don’t have like making it through their call center. They make a very pleasant experience. But if I could tell you the number of questions the lady on the other end of the phone could answer, you’d think she never was involved in a real estate transaction ever in her life, sweet as she could be. And so really capitalizing on their lack of training, their lack of knowledge about the space, their 50% close rate. I mean, that’s sucks.
Mike:So let’s talk about that. So that means they’re backing out of deals.
Brian:Half. One out of every two. Yeah.
Mike:Yeah, and we’ve seen that ourselves. You know, we’ve tested like selling houses to them and we’ve heard lots of horror stories where they tend to . . . you know, I don’t know how this couldn’t really damage their brand over time. They tend to over promise something and then it’s like a week out from closing and they’re like, “Oh, well, we didn’t know it had needed this. So we have to agree to a $10,000 or $20,000 price reduction. And if you don’t do it, we’re going to have to back out.” I mean, that’s what they’re doing, right, is they’re coming back.
Brian:Or they give you the option to fix it yourself. Well, newsflash. I mean, people are selling in their home because they don’t want to do the repairs, right?
Mike:And/or don’t have the money to do it anyway, right?
Brian:Right. And so, I mean, what do you think’s going to happen when you make an offer on a home that you’ve never seen? And so the problem is and the other problem is that consumers themselves don’t know how transactions tick. And so they can very easily get sucked into bad wholesalers or bad business models for companies like Opendoor and they don’t realize till they’re at the end that it didn’t work and why.
And so, you know, they have all intentions, they want market share but they don’t have the training, the experience, the foresight, and they pay so much up front that it looks like a dream come true and when you’re at the end . . . Anyone that’s ever done wholesaling before knows that you can, we don’t. But you can take the model where you overpay and then reduce the seller at the end. Not recommended. Not something that I endorse.
Mike:No, I agree.
Brian:Because by the time the seller gets to the end, the likelihood that they’re going to call back that first guy and say, “Oh, man, you’re right, those guys are taking advantage of me,” you know, we’re going to terminate and start all over again with you with the same price where those us guys reducing to. It doesn’t happen. I mean, they are pissed. They’re not happy, you know, but they close. And so, you know, if you don’t get the deal in the beginning, you’re not likely to get it towards the end. And so it’s really important to put in the effort up front when you’re in front of a seller to really paint the picture for them of what this is going to end up like. I would say the less motivated your seller, the more it’s still better for them to take a discount from Opendoor rather than yours.
And so that goes back to really identifying what people calling you are really going to sell to you and focusing your time on that person. But, you know, their brand is very much damaged. We buying a house just yesterday. We work with the seller who started her whole search process off with Opendoor, but never even considered the offer they made because of all of the damaged reviews that she saw. And so, you know, so that will have an impact with them over time. And again, every radio commercial they do establishes a brand name, you know, that becomes harder to compete with.
Mike:Talk a little bit about because I know you are unlike anybody I’ve seen in terms of understanding seller psychology, like understanding like you spent a ridiculous amount of time and money understanding that because of where you’re taking your business. Talk a little bit about the fact that there are sellers out there, just like there are people that every time they travel they’re going to go to McDonald’s or a franchise type restaurant. Because, well, at least I know what I’m getting. Chili’s in Dallas is the same as Chili’s in Chicago or L.A. or anywhere else. I just know what I’m getting.
And there’s some people that I just want to go to the local mom-and-pop. I want to try something local. Like they would never go to a franchise type restaurant. But this is the same as for sellers, right? Some people want to work with a big brand that I know should, you know, care about their reputation. And there’s some it’s like, “You know what? I want to work with somebody that’s like right in my market here.” And that’s one thing that I think that these big guys can’t really crack into as easily as the people that just want to work with somebody that’s already in their community.
Brian:Right. So I’ll tell you, well, there’s a reason Chili’s is Chili’s because they have lot more [inaudible 00:26:38] . . .
Mike:Oh sure, sure.
Brian: . . . mom-and-pop store. However, some of the good points is in our world, we’re dealing with people in an age range where our average consumer is, you know, in their 50s. And so they’re a little less tech savvy. They’re a little less willing to buy into this offer on my home over the phone. You know, are more focused on brand and reputation. And so you don’t have to have . . . this is the reason you don’t want to get too out of scale. Because if you need 400 transactions a year to be successful, you’re putting yourself in a much bigger threat, a threatening position or threatened position.
But, you know, for most investors, a couple of transactions a month can be very profitable, and you want to stay in that place, you know, because there’s always people that want the mom-and-pop experience and we find it to be a very important thing to market of our expertise is that, “Listen, we are your local market. We’ve done thousands of transactions here. I can tell you how this is going to end up.” And that’s the thing that someone’s when they’re walking to Chili’s is I want to know what this experience is going to be like. That’s comforting. And so I can provide that to you because I know your market better than one of these large brands.
And so that when I say like really taking advantage of what we do well, really important to focus on those things. Don’t give them the same message that the other companies are giving because you can’t provide the same service. And so at the very highest level, psychologically, you know, sales is about pressing on pain and offering relief. And so the things that people are the most afraid of in home selling to an investor especially, if you neglect to mention those things and say how you can do it better, you’ve lost a big opportunity.
Brian:Does that answer your question?
Mike:Yeah. It’s competitive advantage. My question kind of originated from is there a way to stand out by leaning into, “I’m a local guy. I’m a part of this community too. I’ve helped a lot of people here.”
Brian:Use the word local. So I went to this event in Las Vegas last week that was really good focused on social media, which is honestly not one of my biggest interests. And it’s something that we’re really moving a focus to, is establishing yourself in social networks. It’s really easy to find . . . let me start over. What are people going to find out if they Google your name? And what are they going to find out if they look up your company name? And that’s going to drive your business. Because even if you don’t have a brand name, someone’s going to look you up.
And so putting content out there and getting people who are happy to write reviews, Google reviews, Yelp, whatever it is, that makes the biggest impact to our volume. Number one, impact is reputation. And so going and using things like social media, not to brag about how big your check is, but to talk about how you solve someone’s problem, that’s what you want showing up and that’s an opportunity to tell somebody I’m local, you know, I’m going to take care of you and then put social proof out there. Because anybody can say they’re great. You need to proof out there. Use social media for that. I think people use social as investors for the wrong reason.
Mike:I agree with that. Could you provide any tips to people that are listening now, Brian, that to do a better job of getting social proof? Because, you know, every time you buy and sell house, you have an opportunity. If you delivered, right, to get a testimonial, but it’s so easy for us as investors especially guys that aren’t doing a lot of volume, guys or gals that aren’t doing a lot of volume to just like be thinking about, “I just want this thing to go through. I don’t want to ruffle any feathers. I want to get my check or my wire and move on to the next one.” But we’re missing those opportunities. Any kind of guidance on how to do better at that?
Brian:There are things that I wish we did better at that. But one thing I’ll tell you for sure is once the seller walks away from the closing table, that the opportunity is over, right? Very hard to get people to do things, you know, after the fact. And sometimes showing up at closing and handing them the iPad, you know, “Here, sign into your Google account. Do you mind?” And we really emphasizing to the person how important it is that they write that review. Like how impactful it is in helping other people that need to sell their home understand that we’re a reputable resource.
And we want to be here for many years to help people like you. “Would you mind taking five minutes and writing this review for me?” Because everybody has access . . . like, you know, we use Trustpilot, [inaudible 00:31:29]. We use all these resources that cost all this money. But Google is free, and Yelp and Facebook and have those links prepared. You know, walk into closing. We have our title company ask for those reviews for us, you know?
Mike:Yeah, that’s awesome.
Brian:Sitting face to face and saying, “You know, Mr. Seller, I delivered for you. This is so important to me. Could you please help me?” There’s nothing I could say on here that would demonstrate how powerful and how much business we get because we do that.
Mike:Yeah, that’s awesome.
Brian:Or whatever it . . .
Mike:I don’t know about you guys, there are some other people, so you’re a member of our Investor Fuel Mastermind and we’ve got a lot of pretty accomplished people in there that have shared ideas. And some of the other things that they do sometimes is they might even offer a gift certificate, $25 gift certificate or some little thing and . . . What’s that?
Brian:There’s no shame.
Mike:Yeah. No. Well, I mean, the truth is everybody, you know, money talks or gift is talking. You know, it’s not like, “Hey, if you lie here, I’m going to give you this.” It’s like it’s just an incentive to get them to actually take action. Like “Do you mind if we buy you lunch after you close today? Here’s a $50 gift card. Thanks for everything. But we’d really like you to do this first.” Right?
Brian:Right. What we say is the same thing. So don’t just say, “Hey, let me give you some more money.” What we say is, “You know, we would really like to treat you and your family to dinner at your favorite restaurant. You know, can we offer you this $100 gift card if it’s worthwhile?” And then tell them and then remind them, “You know, when you first came . . . ” Remind them why they came to you. Because the more they’ll say, “This was my problem and this is how this company solved it.”
Remind them, “When you came to me, you didn’t have any way to probate this will. You know, your sister and you couldn’t agree. You know, would you mind writing about that and telling us how this transaction was impactful to solve that problem?” Push, ask for what you want. You know, things [inaudible 00:33:22] you got to ask for it.
Brian:”I need you to do this.”
Mike:But make it easy, for sure. For sure. Because a lot of these folks are they’re there to get their check and move on, right? So you got to make it worth their while and make it easy.
Brian:Yeah, pay attention to your clients. If they got a Gmail address, they’ve got a Google account. You know, if they’re working off of aol.com or att.net, then you might want to point them towards Yelp.
Mike:Yeah. Hey, Brian, this has been awesome. If folks wanted to learn more about you, I know you’ve got a lot of great things going on. You or what you’re doing. Where would they go to learn more?
Brian:You can check our website out bigstatehomebuyers.com. And you can Google my name. We have a lot of content articles and things like that. We guest write for a lot of papers and things like that. So it’s Brian Spitz, you know, Houston. And I think over the course of the coming six months, you know, there’s a lot of products that we’ve developed that we want to make it available to people who have audiences like yours. And so you’ll go see those opportunities to help other people’s businesses become more efficient. So it’s not so much about coaching is actually providing tools that are a little bit more innovative than what’s available in the market today.
Mike:Yeah. Is it too early to give a little sneak peek or talk about what you’re working? I know you’re working on . . . okay, I certainly couldn’t explain it as well as you would. Any little sneak peek?
Brian:Yeah, sure. So I went to school for psychology. So the way people think has always been most the biggest advantage for me in sales. And we’ve generated some technology and algorithms and things that are based on our historical transactions that can do that work for you. It will predict your sellers’ motivation and their end result of a transaction from one phone call. So we’re going to provide that for people who belong to networks like FlipNerd. And then on the same end we’ve developed some things for buyers that will help only put properties of interest to them in front of them.
And so, again, rather than developing our own . . . constantly feeding with our own stuff, we want to make that available to other investors. And really, I’ll tell you for plug for your Investor Fuel, one of the biggest things that really got me to the end of this notion of providing tools to other investors is we sit in that room in those masterminds and talk about . . . everybody talks about Opendoor. Everybody talks about those threats. And I look around the room and I see more money and more time and more knowledge about this industry collectively, you know, in that room than any one of those companies can do.
And so I think anything that we can provide as a community, now’s not the time to be telling sellers how bad your competitors are. You know, now’s the time to think about how we can all work together in whatever ways possible so that we can survive the changes to the market. And I’ll tell you, it was really attending one of your masterminds that really kind of helped me complete our vision. So . . .
Mike:That’s awesome. Yeah. I think you know, in terms of masterminding or getting around other people, I mean, we were obviously huge advocates of it. I think, you know, I’ve shared my story many times to people that listen to the show, but initially, for the first couple years, I was . . . you know, I didn’t really want to network. I put my head down. And just I thought everybody was my competition. So why would I network with them or try to discuss what’s going on with them? But there’s so much value that comes out and I was so naïve. And I’d say there’s so much value that comes out of just getting around likeminded, hardworking people that have insights that you don’t have, and just sharing those stories and lessons.
Brian:Well, you know, it all starts at the top of any organization because, of course, your experiences with, what, you know, major organization that really . . . you know, the organization pits people against each other and against the parent organization. And so you create a culture of competition and fear and police state. You know, but it’s really the wrong . . . It’s not the model for a successful organization.
Mike:I agree with that.
Brian:I think the more people like you can bring that to the investor community then your people that buy into that are going to be in it for the long haul.
Mike:Awesome. Awesome, Brian, thanks again for joining us today.
Brian:My pleasure. Thank you.
Mike:We’re going to add links down below. And as you as you get closer with your launch and this new technology, which I have a little bit of insight to, it’s going to be pretty impressive and help a lot of people. So we’ll definitely kind of communicate that to our audience.
Mike:March launch. March 2019. Awesome.
Brian:Yeah. So we’re going to trickle more information out between now and then kind of unveiled the new brand sooner than later. But by March of 2019, it’ll be [inaudible 00:38:13]
Mike:Awesome. It feels really weird saying anything about 2019. That’s just saying a year. It’s like sounds like we’re, well, into the future but it’s just a few months away.
Brian:I’m pushing another decade past over the next couple of years so I can bring [inaudible 00:38:28]
Brian:So anyway, thank you, bro.
Mike:Thank you, Brian. Thank you, Brian. Yep. Everybody, hey, this is episode number 438 with Brian Spitz talking about these big competitors coming into our market and what we can do differently. So the reality is with every step of adversity you face, there are opportunities that are created. And so rather than trying to hold on to the past and do things that you’ve always done them, we’ve probably all seen investors like that, that are still doing things the way they did them a long time ago and they’re struggling more than ever. Like, just know you’ve got to evolve. You’ve got to continue to evolve in this business.
And given the size of the housing market and the fact that there’s hundreds of millions of people in the U.S. and they all need housing, there will always be an opportunity for us. It’s just a matter of can you evolve and shift as the market changes? So, again, episode number 438. Thank you for joining us today. If you haven’t yet, please subscribe to us on iTunes, Stitcher Radio, Google Play, YouTube, wherever you might watch or listen to us. And, of course, we have over 1,500 podcasts on flipnerd.com and you can watch and listen to all of them there. So appreciate everybody. Thanks again, Brian.
Brian:Thank you. Thank you.
Mike:Awesome. Awesome. Everybody, have a great day. We’ll see on the next show.
Man:If you’re an active real estate investor already doing deals and looking to double or triple your business, you should consider joining the Investor Fuel Real Estate Investor Mastermind. We’re a small group of investors that share our best practices, tips, and tricks with one another in effort to all win. Real estate investing can be a lonely business for successful real estate investors.
But it doesn’t have to be. Investor Fuel members meet four times a year, but we talk to each other 365 days a year and we focus on improving the profitability of our businesses, improving the quality of our lives. That’s why we do this, right? And making an impact on those around us so we can truly leave a legacy.
We limit our membership to only one to two members per market, so everyone shares their knowledge, tips, and tricks openly and honestly. Our members include some buying one to two houses a month, up to some of the most respected investors and leaders in the real estate investing industry, some of which have personally done over 1,000 deals. If you’d like to be considered for our invitation-only, world-class mastermind, please visit investorfuel.com to request your personal invitation. Our next meeting is coming up quickly. Go to investorfuel.com now to learn more.
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