Virtual Real Estate Investing

Mike: Hey, everyone. It’s Mike Hambright with FlipNerd.com. Welcome back for another exciting Expert Interview, where I interview successful real estate investors from across the real estate investing industry to help you learn and hopefully inspire you. Just another quick reminder about the upcoming REI Power Summit, it’s coming up really fast now. It’s going to be one of the largest online real estate investing events ever.
It’s 100% virtual, so you can watch it in your undies or whatever. You can watch it from anywhere, and you’re going to get access for 12 months afterward. We have over 50 great speakers. A lot of great information is going to be shared here. So check out reipowersummit.com.
For today’s show, I’m excited to see my friend Joe McCall who’s been on the show before, about 200 episodes ago. But Joe is a well-known virtual wholesaler, a podcaster, a mentor, and a coach. Joe and I are actually in a mastermind together, and Joe really inspires me and a lot people. I think he’s going to inspire you today. He just returned from a three-month vacation to Europe with his family, where he bought and sold properties that he never saw from thousands of miles away. Did it all from a laptop. I saw him posting pictures from a café and different parts of Europe.
But Joe is really one of the best that I know, in terms of putting together processes and systems that enable you to live that type of lifestyle. In fact, he did the same thing last year and for three months, lived out of an RV and traveled all around the US with his family. So it’s the type of stuff that a lot of us dream of, but we just don’t seem to be able to get there. So Joe’s going to share some of his secrets today, and tell us a little more about virtual real estate investing. Before we get started, though, let’s take a moment to recognize our featured sponsors.
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Joe, welcome back to the show, my friend.
Joe: Mike, it’s good to be back. How are you?
Mike: Yeah, yeah. So welcome back to the, I would say the motherland, but I guess if you’re in Europe, maybe they don’t think of the US as a motherland.
Joe: No, they don’t.
Mike: Yeah, but hey, good to see you. Thank you for being here today, and I will tell you that my wife and I talk all the time about, “Let’s just take off, and go do this and that.” And we’re just never able to pull it off, so I’m excited for you to share your story with us today.
Joe: Thanks. I will say it wasn’t exactly a vacation for three months. It was a working vacation. I did try to work as much as I could, but that really only meant I was probably working only 20, maybe at the most 30 hours a week, for the simple reason that it was hard to get good reliable internet while we were there. But our home base was in Prague, and then we would travel for maybe a week at a time, once or twice a month for those three months. It was a lot of fun.
Mike: Yeah. Yeah, and I should say I don’t know about you, but for me, I don’t know that I could ever retire. I’m always going to be dabbling and doing something. And for me, people think that I travel a lot, not as much as you, but we’ve been able to take some great trips. And we always end up working there, but it’s just there’s something nice to be said about . . . it’s just not quite the same. You’ve got the flexibility to enjoy the rest of your day doing something else, right?
Joe: Well, it’s working on your own terms. I mean, do you remember the days, I don’t know if you ever had a 9 to 5 job.
Mike: It was never nine to five. It was more like 8 to 9. 9:00 p.m.
Joe: I had a 6 to 6 job and working in my cubicle, and it was horrible because no matter how hard I worked, I got paid the same. And I remember that feeling of always counting my vacation days and personal days and holidays and trying to figure out, for the year, when I was going to take time off. I remember when my wife and I were taking a trip to Colorado. This was probably in 2011, so four years ago. I left my job in 2009.
And we were in Colorado and skiing, and we just said, “Let’s just stay an extra week.” And we did, and it was not a big deal. And I remember that feeling just hit me all of a sudden, like, “Holy smokes.” I couldn’t do this two years ago. I would’ve been stressed out about getting back in time, to get back to work. But the freedom that this business can give you is so awesome, where you don’t have to ask your boss for time off. You know what I’m saying?
Mike: Yeah, I’ve had some similar experiences where I am talking to a friend that does still have a corporate job, and I’m like, “Why don’t you come on this trip with us?” And they’re like, “No, I only have four days left for this year.” And it’s just you start to forget sometimes after you’ve been doing this for a while, but it’s like that just doesn’t compute to me.
Joe: Well, but the problem, though, is that sometimes you get to take your work with you. That’s the hard part for entrepreneurs, to separate time off, time with family, or doing work because with the business that I do it, virtually, all I need is a laptop and an internet connection. I don’t even need a cellphone anymore because I can make calls from my laptop. And I don’t even need a laptop anymore. I can do my business from an iPad or an iPhone, so it’s sometimes still hard to separate.
And that’s something that I was challenged with, and even though I was only working 20 to 30 hours a week, we went to Europe with the intention of actually making it a working vacation. So we homeschool our kids, and we were able to do a lot of really cool things. But still, while I was trying to get some work done, that also created a little bit of stress at times, as well. Overall, it was a great trip. It was so much fun. It was awesome. Even my little four-year-old daughter the other day was asking when we can go back to France.
Mike: Yeah, there you go. Awesome. Well hey, just take a minute, Joe, for those that don’t know you, and introduce yourself. Tell us about you and how you got to where you are today because I know that you were once a corporate schlep just like me and probably a lot of people listening to this call.
Joe: Yeah. Well, my background, I guess, is in civil engineering, so I’ve always been good at math. I like math and science and stuff, so I studied engineering in school. And I liked the civil engineering field because then I could work out on jobsites and build some really cool stuff. So I worked for a couple of companies building large power plants, large office buildings and schools and aquatic centers, and some really neat stuff.
But I just got tired of working for the man. And I always had that entrepreneurial bug in me, and I loved real estate. So I started buying a ton of properties, had a lot of real estate, market crashed, took me down with it, and got really, really ugly for me in 2006 through 2008, 2009. But I started wholesaling, and wholesaling is basically getting a property under contract and selling that contract for a profit. And I started doing a lot of that in 2008, 2009, but I was still struggling because I was spending a ton of money on marketing and throwing away a lot of leads that didn’t have any equity.
And I started thinking, “What can I do with all of these leads that don’t have any equity?” And so I started flipping them as lease options, and that’s what we talked about, I think, on my last interview with FlipNerd. So I started flipping a lot of lease options in ’09, and that’s what allowed me to quit my job. And I was making more money flipping lease options part-time than I was in my full-time job, and I was making a good $85,000 to 95,000 a year on my engineering job. So that’s when I quit, but what was interesting, though, was I was thinking about systems and what allows us to travel and create a virtual job.
I was just talking to my accountant today, and he was saying to me, “Joe, I just can’t believe, looking at your gross receipts . . .” he calls that, basically my total revenue for the year. He said, “Looking at your revenue here, you don’t have any equipment or overhead. How do . . .? What? This doesn’t make sense to me.”
But, you know, he was thinking real estate investor. He was thinking we’ve got to have tools and equipment and a warehouse to store all your stuff. You need to have a big office that you’re renting out, and it’s just you don’t need to do that with this business these days.
Mike: Yeah, for sure. I would say even when I got started in real estate investing, we kind of dove in. I really didn’t, I mean, conceptually, I guess, I understood it, but I was planning to be a rehabber. I didn’t really think much about wholesaling, and then, of course, very quickly you realize, “Wow, that really helps with cash flow.”
And even if you’re a rehabber, you shouldn’t rehab every house that you get. I mean, there’s clearly some stuff in the ghetto that you don’t want, and there’s probably some high-end stuff that you don’t want to take the risk on. You have a sweet spot in there somewhere. What do you do with the rest of it? Well, you should wholesale it, right? Find another way to monetize it.
Joe: I love wholesaling. I do, I love it a lot. Every deal I’ve tried to rehab, I’ve lost money on. The disadvantage to wholesaling is you don’t get many write-offs, right? When you buy property, you can write off or deduct, I’m not a tax expert, but you can take depreciation. You can deduct a lot of write-offs with that, but with wholesaling, they’re so simple to do.
In the same amount of time that you rehab a deal and make 30 grand, it may take 6 months, right? Buy it, fix it up, sell it. In that same period, you could do five, six deals and make the same amount of money, if not more, just wholesaling, without all of the moving parts and without all of the risks and the liability that you take on by rehabbing. Now, I still believe in rehabbing because it’s a great way to make good money, but when you’re wholesaling, it’s so much easier, in my opinion.
Now, some people may say, “Well, you have to wholesale four or five deals a month to make the same amount of income that I’m doing rehabbing these deals.” Well, I can see their point, but then it comes back, “Well, wholesaling really isn’t a business that you can automate. It’s not really passive income because once you stop marketing and once you start making offers and talking to sellers, then the money stops flowing.”
Well, I think that’s not exactly entirely true because if you set it up right, you can automate and systemize your wholesaling business, and that’s what we did while we traveled last year for three months in our RV in the northwestern corner of the US and then this summer when we went for three months in Europe. I automated my wholesaling business where I had someone else do the marketing for me. I had somebody else prescreen the sellers and talk to the sellers.
I had somebody else meet the sellers, get the properties under contract, and sell them to their buyers. And I didn’t do anything, literally. I didn’t talk to the sellers, I didn’t talk to buyers, I didn’t see the houses. I just work with my team and people that I’m partnering with to do these deals.
Mike: And built a system. You built a machine. Right?
Joe: And I did that, Mike, because when I was in my job, I was forced to because I’m working ten hours a day. So I realized early on how important marketing is. So that was the first thing I systemized and outsourced. If I don’t get someone else to do this marketing for me, it’s just not going to get done. So I hired VAs to do my marketing for me. And then . . .
Mike: You’re primarily doing direct mail, is that right?
Joe: Yes. And also I’m doing some Craigslist stuff. Like I’ll contact landlords and FSBOs on Craigslist saying, “Hey, do you want to sell your house?” And we did some Google AdWords, as well, but I realized early on that if I don’t get someone else to do that marketing for me, it’s just not going to get done. So the marketing now is consistently coming in, which means I’m getting a lot of leads. And I can’t keep up with all the leads, so I found a friend at the time, who worked on 100% commission who could take those leads and work them for me.
Once he got them under contract, then I thought, “Okay, well, it will be easy for me to sell them.” But then I realized, again, that’s a lot of work. I can’t do it. I can’t manage that, so I got a realtor to sell my properties for me. And so pretty soon, I have this system where I have someone else doing the marketing, someone else taking the calls, someone else selling the properties, and it only took a few hours of my time every week to keep up with that.
Mike: Sure. Well, when you started this, correct me if I’m wrong here, you were primarily doing this in your market in the St. Louis area, is that right?
Joe: Yeah, yeah.
Mike: And you’ve since expanded to do investing virtually in other markets, as well. Is that right?
Joe: Yeah, well, we’re in about three different markets right now, St. Louis, Missouri; Memphis, Tennessee; Tampa-St. Pete, Florida; and Houston. How I started this whole thing is . . . and this, I think, would be educational for folks.
Mike: Educate us. Show us the way.
Joe: Well, I wanted to wholesale more deals, but I didn’t want to do the work, right? So I hired an acquisitions manager. I put a job on Craigslist, and said, “I’ll train you how to do the acquisitions.” I got a lot of applications, and this guy was a part-time pastor and a part-time Home Depot salesclerk. So he worked at Home Depot making, I think, $9 an hour to pay the bills while he did part-time ministry on the side.
And his heart and passion was really into ministry. And this guy actually, he first applied to an admin assistant job that I posted, but I hired someone else. But he was real persistent. I liked the guy. He was really nice, and then he responded to my acquisitions manager ad. So then I hired him. So I started working with him and training him on how to talk to sellers, how to negotiate, and I found out early on he was really good with buyers, so I started having him focus on finding buyers first, finding out what they wanted, and then finding the deals for those buyers.
So pretty soon we’re doing seven, eight, ten deals a month, and that was going really well. But then I was looking back, and I’m still putting out fires. I’m still answering questions, still trying to motivate him. There are always issues that come up with title, right? And who’s the first person that they call to help? “The world’s falling apart, the skies falling, we’ve got to take care of this issue right away.”
So I still found myself answering a lot of questions, putting out fires, and dealing with issues. And I’m still only netting 40% to 50% of the deal after all of my expenses.
Mike: But it’s all variable, right? So you’ve got it set up to where, for the most part, probably other than your VA’s, that people are getting a piece of each deal so that you’re not paying salaries out, I guess?
Joe: No, right, I’m not. Except for my assistants, I do pay salaries to them. So anyway, though, this is going well, but I looked at it and I wrote down everything you have to do to wholesale a deal. And I just asked myself a simple question, “How can I do none of this?”
I started looking at, well, I can give this part to this person and this to this person. So what I started doing was partnering with local wholesalers, friends that I knew that were in another market, even in minor local market who are already doing deals, they just maybe are not getting enough. They want more leads. Maybe they’re the type of person that just wants to be in their truck looking at houses, talking to sellers, and making offers. They don’t want to be the one sending out a thousand postcards, prescreening a hundred sellers, trying to put everything into the database, and keep track of all of that stuff. They don’t want to do that.
Well, that stuff is easy for me to systemize and automate and delegate out. So I started approaching of my wholesaler friends in other markets and said, “Hey, listen. What if I did the marketing for you in your market, and my team will send the postcards, do the direct mail, whatever it is that we’re doing, Craigslist or Google pay-per-click. And I’ll pay for that. I’ll pay for all the marketing, and then I’ll even prescreen the leads. And I’ll put them in Podio, and we track everything in Podio. And then you take the prescreened leads, and you call the sellers back, set up an appointment to meet them, get it under contract. You already have buyers, just sell them to your buyers, and we’ll split the deal 50/50.”
And so we started doing that, and some of my partners I’m actually splitting the marketing costs, as well, out of the deal. So it’s a pretty sweet deal. I mean, they’re only paying me out of the deal itself, right? So I’m investing the marketing. I’m investing the time into prescreening these leads and doing all the follow-up, which is really, really important. So we’re doing all the follow-up, as well, and then that wholesaler just takes those prescreened leads and sells them to their buyers, and we split the profits. I just got an email today from one of my wholesalers in Florida. He’s sending me a $6500 check, and that was on a deal that got under contract and acquired while I was in Europe.
Mike: That’s awesome.
Joe: It’s a beautiful thing, and it’s so simple. Right? It’s just a matter of setting up the systems, finding the right people to work with, and just doing the marketing. I have a client in your neck of the woods. I won’t say where because he’s still working for a large international corporation. He still has the golden handcuffs, but he doesn’t have much time to do this business.
And he contacted me just a couple weeks ago, since April, so it’s been six months, right? Six months now. He’s made over $85,000 in wholesaling fees and consignment fees by partnering with a local wholesaler. So he does the marketing, and he actually does have some time.
He likes to prescreen the leads himself, and he found a good wholesaling guy that, again, just wants to be in his truck looking at houses, making offers. And he does the prescreening, and he does the follow-up. And it’s very easy for him to do.
Mike: Sure, sure. Joe, talk for a couple minutes because I think a lot of real estate investors, they tend to be, you know, cowboys, lone wolves. They don’t need anybody else. They want to do it all themselves, and in the process, they end up missing out on opportunities because they are so, kind of, glass is half empty type of mentality. That type of mentality is pretty prevalent in our industry because people are . . . I don’t know what it is.
It’s just this mentality of “I don’t need anybody else. I read a book. I went to a boot camp, so I don’t need anybody else.” But clearly, we both know that partnering with people, JVs, finding ways to work together with other people really . . . one and one is sometimes greater than two. But just kind of talk about that issue, and it sounds like you had to overcome that at some point. It sounds like you overcame that pretty quickly, but share that lesson with people out here.
Joe: Well, a lot of people are control freaks, right? And they’re afraid to let go because somebody else can’t do it as well as you can. And I remember it because about two or three years ago I used to have a lot of Filipino virtual assistants, and I still have Filipino VAs. But one of my friends, a mutual friend of ours, Todd Toback, was harping on me all the time. “Joe, you need to get a local assistant.” And I was afraid to do that. So now I have two full-time, well, actually, three full-time local assistants and one part-time assistant.
And looking back over my last few years at my numbers, my income has tripled since I’ve hired local assistants to help me. And you would think, well, that’s higher overhead, more overhead. Right? And I always thought in the past that overhead’s bad. And you got to manage it, but for me, having local assistants has made a huge difference in my business because they’re just better quality.
Now, nothing wrong with Filipino’s, again. We have Filipino assistants that help my local assistants do their job, but I found I was just able to get so much more done. So I have my education business and my wholesaling business. And right now, about 20% of my income comes from wholesaling, doing deals, and about 75% comes from coaching and education and consulting. And we did marketing services, etcetera. So it’s so much easier to work with somebody local that can just get it done better and faster many times than a virtual assistant from the Philippines.
So that, for me, has helped a lot, just finding some good helping, finding people that can help me to get it done. I can give them a vision. “These are the results that I want. Just help me figure out how to do it.”
Mike: Right, right. Back to the control thing, I think a lot of people have concerns with . . . some of those concerns can be set aside by checks and balances. For somebody that’s very systems oriented, talk about some checks and balances that you might use to allow you to kind of be there or be there enough that people that you’re watching when you’re away for weeks or months at a time.
Joe: Well, I think it comes down to having the right systems and tools. Podio is a big benefit for me. Podio is basically a design-it-yourself to manage your business the way you were, so nothing wrong with other CRMs that are out there. There are a lot of good ones, like Lead Management Systems, even for real estate investors. But the problem is it’s a box.
They put you in a box, and you have to fit in their box. And I always like to say, “Well, what if you don’t like boxes? What if you want to get out of their box and create your own cylinder or your pyramid? It’s not a box. You want something different.” Well, Podio allows you to design your whole business and track and control your business the way you want to be controlled.
So Podio helps a lot because you can start tracking your seller leads and your buyers and your contracts, even your standard operating procedures and your meetings and your expenses and invoices. Everything and anything that you want you can track inside of Podio. So I use that now to track my information business, my coaching business, marketing business, and deal business. All of this can be tracked inside of Podio, and I’m not fitting into somebody else’s mold. I can design it any way I want, and that really helps with accountability.
The other big thing is key performance indicators, KPIs. And this is what I’m harping on all the time with my consulting clients. What are your KPIs? You should be talking to five sellers every day.
You need to know what your numbers, you need to know, well if I want to make ten grand a month, I need to send out 500 postcards a week, send 20 yellow letters a day, talk to five sellers a day, put out 20 bandit signs every weekend. Whatever it is, you need to know your numbers and then create a scorecard to start tracking how much marketing you’re doing every day, every week, how many sellers are you talking to, how many offers are you making, and track those calls from the marketing campaigns. So you do this, and you’ll start to realize, “Holy smokes, I’m getting 75% of deals from postcards to absentee owners. Maybe I should do more of that.”
We’ve just started doing Google AdWords, and it’s going really well. I think we’ve done, I think, two or three deals now, Sheila, from AdWords, two deals from AdWords, and it’s been two or three months since we’ve done it. So you’ve got to know your KPIs, your key performance indicators. And usually, that comes down to which marketing campaigns are working or your cost per lead, your cost per deal, and some things like that. So it’s important to have a scorecard that you can track the marketing that’s coming up and the calls that are coming in.
Mike: Your business, sure, yeah. Now, do you use similar metrics or tracking mechanisms, I guess, maybe even inside of Podio to track scorecards for your staff members and virtual team members and things like that so you can comfortably look at some sort of report and say, “Everything seems to be fine here”? Or, “Wow, we’re really falling apart in this market.”
Joe: Yes, and no. Again, I sometimes fall short of where I think we should be on tracking those kinds of key metrics. My assistant does a good job of putting together a report by market that we’re in, how much we’re spending on marketing, and what’s coming in. I probably need to do a better job of managing that myself.
Mike: It’s hard to take a lot of that stuff from idea to it’s implemented, and I’m totally comfortable with it. It’s tough.
Joe: It is. Well, my problem is I give my team too much work. I’m constantly throwing things at them. “Get this done. Do this.” So it’s hard for them to keep up with my latest and greatest scheme because I’m always jumping from here to there.
Mike: That sounds familiar. Sounds familiar really familiar, Joe.
Joe: Great minds think alike.
Mike: So in terms of . . . so when you go into a few different markets, like you have, talk about the importance of having the right boots on the ground, in terms of you said you partnered with local folks. Talk about the importance of that because there’s a reason why you picked those few markets versus just saying, “Well, I’ll just go anywhere.”
Joe: Yeah, well, it’s important to get the person first, I think, and then pick the market, right? So these are just people that I know, that I trust, that through masterminds or through Facebook or through my podcast, friends I’ve made said . . . I’ve contacted them and said, “Listen, I know you’re doing some deals. Can I help?” And it’s important you build the value.
You’ve got to do something that’s valuable to them. So it’s worked out pretty well. There are a few guys I’m not working with anymore, but you want somebody that can answer their phones, that can return calls promptly because if they’re not returning your calls, they’re probably not returning sellers’ calls, right? So I look for people that have somebody in place that is good on the phone. Ninety-five percent of this business is sales, being able to talk on the phone and negotiate with sellers, so I want to make sure that they’re good on the phone, they’re accessible.
When we get a Google pay-per-click lead, that goes right to my assistant, to her cellphone, and she calls them back right away. And a couple times we’ve actually, because she was able to take that call live and transfer it to our local wholesaler, who was on the ground, within a half-hour to an hour sometimes, he’s there at the seller’s house getting it under contract. So the speed of implementation is really important.
So when you’re looking for a local wholesaler to partner with, you got to make sure that they . . . I tell my guys, “Listen, don’t worry about any of the administrative stuff. Let us take care of that for you. Here’s my team. Just send them a voice memo. We’ll update Podio for you.” Right? “Just send us a voice memo . . .”
Mike: With notes after the meeting, they’re telling them what happened, and your assistants are putting the notes in Podio. Yeah.
Joe: Yes, so the ideal, this is ideally where you want to be at. And I’m not saying we’re there yet, but this is where we’re shooting for, okay? Ideally, you want to be where you have your assistants doing the marketing, the leads are coming in, and you’re not in Podio yourself, or whatever your CRM is. You’re not in there yourself. You’re assistant is just emailing you the next thing that you have to do. And maybe you have a special, private email address that only she has.
She’s sending you the next thing you got to do with all the information in it. Call this seller. Okay? So you click the link to call that seller from your phone, you talk to them, maybe you keep some notes on your yellow pad. And then you do a voice memo with something like WhatsApp or Voxer from your smartphone. “Hey, Shannon, I called this seller at 123 Main Street. It’s already listed. Just remind me in two months to call them back, and send them an offer or something in the mail.”
Done. You send it. Your assistant then updates Podio, and then adds a reminder in two months for you to call them back. Maybe she creates a follow-up letter and a contract and offer and sends it to the seller, and it’s done. You don’t have to be in Podio doing that. Or maybe it’s, “Go ahead and put it on my calendar. I’m meeting with them tomorrow at 9 a.m., and do this.”
So then, once you get that thing done, your assistant sends you another email. “Hey, here’s the next thing.” She’s getting this stuff from Podio, right? Or whatever your CRM is, your next task. So it’s about focusing on the 80/20 stuff, right? Eighty percent of your revenue comes from 20% of your efforts.
So what are those 20% of those things that you need to focus on? What if, Mike, we focused 100% on the 20%? You know what I’m saying? And I hope my audio’s coming in because my screen’s flipping in and out.
Mike: You’re good, you’re good.
Joe: What if we focused our 100% on the 20%? And that 20% is what? Your highest revenue-generating activities. That’s talking to sellers and making offers and following up. Those three things, right? And if you have the systems in place, and you’re tracking your numbers, your key performance indicators on those 20% of things, which is marketing, right?
It’s talking to sellers. It’s following up. You can really, really go far in this business. You can make a lot of money. Does that make sense? Does that answer your question?
Mike: Absolutely, yeah. Yeah, and so I want to clarify one thing here that some people might be thinking about because we have different guests on the show sometimes. When people talk about virtual investing, there are some people that . . . There’s really, I don’t want to say two kinds of real estate investors, but in the essence of what I’m talking about here is actually meeting with sellers, there are two kinds of people. Either you go sit on the couch with them or sit at the kitchen table and talk about solving their problem or you try to do everything over the phone, and you never meet with them.
And so the camp that I’m trained in, we go and sit down, and we meet with them. We spend time. We make the effort. We do all those things, and it sounds like you’re in that camp, as well, even though, specifically for you, you’re not doing it yourself.
Joe: Yes. So I’m going to partner with someone from HomeVestors to take my prescreened leads and work them and get them under contract and partner with me on those deals. Now, I know HomeVestors probably has rules against that or whatnot, but . . .
Mike: Have you had a big Joe McCall sign with a line through it? I’m joking.
Joe: No, and I didn’t invent this. I had friends that had been doing this for [inaudible 00:32:16]. It finally dawned on me, I had a client who was in San Francisco doing a lot of marketing, and it’s a competitive market. It’s expensive, prices are real high. And he had a girlfriend. He was working his full-time job.
She moved to Fresno, California, okay? And he was going out on weekends to visit her in Fresno. And one day he was driving around Fresno, and he saw all these “We Buy Houses” bandit signs on the road. And he wrote down all the phone numbers, and he had this idea. He said, “Why don’t I call these guys?” So he called these guys up and said, “Hey, listen, are you doing deals?”
And by the way, he had to weed out 75% to find the 25% that were real legitimate. And he said, “Hey, listen. Why don’t I do the marketing for you, and I’ll prescreen the leads and send the prescreened leads to you. You work them, and then we’ll split the profits.” So what he did is he stopped spending money, and he was actually in San Jose, which is real expensive.
And he started spending that same amount of money in Fresno, getting more leads because there wasn’t as much competition. And then he started making enough money that he quit his job, moved to Fresno, and still did the same thing, even after he moved there because these guys were already good at talking to sellers, negotiating, and sitting down at the kitchen table, belly button to belly button, as they say, and negotiating, building the rapport, the relationship, and closing these sellers. It’s so important.
People think I should just be able to send out some emails and make a couple phone calls and flip these deals. And you can, but you can make a lot more money if you’ve got a motivated seller. You want to be working with somebody that will drop everything they’re doing to go meet with that seller in their house and spend eight hours with them, if they have to, before they leave with that contract signed. And so sometimes that’s what it takes, and you need to find those kinds of guys that are willing to do that.
We did a workshop in Barcelona, Spain right before we left, and one of the things that we did that was so cool is we had half of the room stand up that had money to invest in marketing but didn’t like talking to sellers, and we asked, “Okay, who else of you does not have money to invest in marketing, but you are good at talking on the phone, and you’re good at negotiating?” And the other half of the room raised their hands. So we set them up, and we put them together and said, “All right, now go find somebody that you can start partnering with. If you have the money, you can invest in marketing. You don’t have money, but you’re good at sales negotiating. Start working together.”
And we did that before, and there were two guys there that became business partners and exactly that. One guy had a full-time job, didn’t have time to talk to the sellers, but this other guy was good at talking to sellers, he just didn’t have the money to invest in marketing. And they’ve done like three or four deals in the last couple of months since they started working together. So it’s about finding your strengths, what are you good at? Partnering with somebody else who maybe is . . . It’s not a business partnership. This can be on a deal-by-deal basis, right? It’s finding your strengths.
Mike: Right, right, right. Yep. I think that’s probably another thing, you can probably give some guidance on this, but I think a lot of people . . . and this is how kind of how I used to think is whenever you think of partnership, you think of a marriage, right? You’re thinking of something long-term. But then talking to a couple people, they’re like, “No, no. We just worked together on a deal, and we see how it goes. And then if we want to do it again, we do it again.” I think that’s a very different . . . I mean, it sounds so simple when I say it to myself now, but I think a lot of people that are trying to get started, sometimes it’s good to just have somebody that you can . . . you have similar interests, and you’re interests are aligned, at that point.
And you find a way to work together, and say, “Let’s just see how it goes from here.” You don’t have to own half of a LLC each or anything like that. It could be some sort of just simple JV relationship.
Joe: Maybe it should be more formal, but the guys I work with, it’s just a gentleman’s agreement. It’s a virtual handshake in an email. Like I spell out this is what I’ll do, this is what you’ll do, and they reply back, “Great, that’s fine.” And that’s it. So it does help to have an assistant who can track and follow up with these leads, right?
So if you have the marketing going out and the leads are going in, you need somebody to help sometimes follow up with those wholesalers. “Hey, are you calling these leads? Have you updated Podio yet with them? How can I help you?” So that helps a lot, but I don’t have any formal written agreement with these guys that I partner with. I trust them. They’re good guys, and they update everything in Podio. And the deal gets tracked through Podio.
Mike: Yeah, that’s great. So Joe, I appreciate you sharing your story. I wish we had more time to hear about your trip and things, but maybe you could take just a minute or two here and share, for folks that are hearing this, and in the back of their mind they’re like, “Well, the system . . .” People get scared by systems, right?
It’s easy to say systems, but it takes a lot of work to set that up. And what you’ve done has taken some time, but just maybe talk about that, those are hearing this saying, “What’s this system? How do I . . .?” I know you have a business where you create the systems for people, but even for folks that want to do this themselves, maybe you can give some guidance.
Joe: Well, I think it’s important to keep it simple. And I like the analogy of the three S’s, simple, systems, scale. And so whatever you’re doing, it’s easy to get overwhelmed with all of the details, and you worry about, well I got to do this, and then this, and then this, and then this. And then, what if this happens? What if that happens?
And we get stuck in this cycle of anticipatory thinking, like, “What about this, and what about that? And what if this happens?” So I think it’s really important to break down your business into simple steps. Step one is figure out postcards. And don’t worry about anything else until you get those postcards at 100%.
So in other words, we all have these things that are bouncing around, and if you were to step aside and say, “All right, where am I at with this?” At 60%, and this thing is 70%, and this thing is 20%, and this thing is 40%. Well, no wonder we feel like we’re running around on a treadmill, not getting anything done. It’s because we have all these things that are not even at 100% yet, so what if we stop and say, “All right, I’m just going to get postcards. And I’m just going to get this down to 100%.”
Keep it simple. Just send this ugly yellow postcard to absentee owners in these four zip codes. That’s it, okay? And then build that up to 100%, and you’re mailing those absentee owners in that zip code every three months. Now, once that is at 100%, then move to the next thing. So keep it real simple, build a system around that simple thing, and then scale it, okay? Then go to the next thing.
Maybe it’s yellow letters, maybe it’s Google AdWords. Okay? Maybe it’s your buyer marketing. So just take it one thing at a time, keep it really simple, build a simple system around that, and then scale that up. And as soon as you get out of one of those three things, you start to get into trouble. If it’s not simple, if you can’t build a system around it, then you certainly should never, ever scale it. So we try to sometimes scale things up before they’re 100% complete or before they’re really simple, and that just spells disaster for folks.
Mike: Yeah, that’s great advice. Joe, well, hey, thanks for sharing. Thanks for being with us today. If folks want to learn more about you and some of what you’ve got going on, where do they go?
Joe: I have too many websites, Mike.
Mike: Well, tell us the most important ones.
Joe: Okay, joemccall.com. J-O-E-M-C-C-A-L-L. joemccall.com. I have a podcast, realestateinvestingmastery.com. realestateinvestingmastery.com. And I put together a course that’s kind of like a coaching program, called Automated Wholesaling, and if folks wanted to check that out, if you go to automatedwholesaling.com, I don’t know if it’s going to be open at the time you’re looking at it, but you can put your name and email address in there to be notified the next time it does open up.
But I work with folks in a group setting and one-on-one, helping them build these, what I call “automated wholesaling businesses.” And on the webinar, I teach a lot of cool things. How I do this while traveling around Europe, traveling around the country, so automatedwholesaling.com would be a good place to go if somebody’s interested in that.
Mike: Awesome, awesome. We’ll have links down below here for anybody that’s interested in learning more about Joe, and, Joe, thanks again for your time today. Great to speak with you, my friend.
Joe: Thanks, Mike.
Mike: What’s next? What are you going to do for your next trip? Do you guys know yet?
Joe: Yeah, we thoroughly enjoyed this trip, had a blast, but we came back thinking, “Okay, we’re done. We’re not doing this again for at least another one or two years.” It took a lot out of us, and our kids . . . we have four kids, 12, 10, 7, and 4. And when you’re gone for the summer, you can’t do soccer. We took our girls out of dance and gymnastics, and so getting them back into that stuff is challenging.
So next summer we’re going to be staying here, but we are already talking about going to Hawaii in January, in a couple of months, at least for a week, at least for just a week. We’re doing a workshop there, a real estate workshop. But then, probably our next RV trip is going to be New England. We homeschool our kids, and so we’re thinking it would be so cool as we’re talking about the Revolutionary War, the Civil War, to be able to take them there and see this stuff. That would probably be our next trip.
Mike: Awesome. Well, Joe, we look forward to your excursions. I do.
Joe: Yeah. Thanks, man.
Mike: I look forward to seeing you again soon, my friend. Have a good day.
Joe: Thanks, man.
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