Today we’ll be ringing the victory bell loud and clear because Adam Rae is a Rockstar Rhino who has made well over $500,000 in the past 12 months – and he’s on track to make $1M in the coming 12 months.
We put him in the hot seat and find out how he’s doing it so that you can do the same thing in your Wholesaling business.
A Big Deal
- “Pick it and stick to it.” Adam found this particular property owner through direct mail, using an absentee owner high equity list, and he responded after the second letter. Adam used to switch lists if he wasn’t having any luck, but he’s since learned the value of consistency.
- Adam is looking for motivated sellers, but he doesn’t consider his job to be buying their house – his job is to help these sellers figure out their options, regardless of whether or not he buys the house.
- Adam worked with and helped the property owner for over a month… and then the property owner decided to rent it out again. Adam said okay, and then he took a simple but often overlooked step: he asked if the property owner knew anyone else looking to sell a property.
- So Adam didn’t actually buy the property that he originally sent mail about, but, as it turned out, the property owner’s father-in-law was moving and he was looking to sell his house.
- This was a competitive situation, so Adam started eliminating other options; he suggested every other option, like using a broker to maximize the money they receive or renting out the property for recurring revenue. They didn’t want to pursue any of the other options, so the only thing left to do was work with Adam.
- Using sales tactics he learned from John Martinez, Adam “anchored” them to the lower price range of $200-235k. Ultimately, they agreed on putting the property under contract for $245k (current market value was ~$315k, and the after repair value would be ~$385k).
- After assigning the contract, Adam received a $50,000 assignment fee!
- At the time of our conversation, Adam had 6 properties under contract with an estimated gross revenue of $130k – and his goal is $1M in the next 12 months.
- Never Split the Difference: Negotiating As If Your Life Depended On It by Christopher Voss and Tahl Raz
- The Like Switch: An Ex-FBI Agent’s Guide to Influencing, Attracting, and Winning People Over by Jack Schafer and Marvin Karlins
- Rich Dad, Poor Dad
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Tom Krol: All right guys, welcome to another amazing episode of Wholesaling Inc. I am super, super excited to be here with you today. We are going to be ringing that victory bell today for sure. We’ve got an amazing rhino, an amazing tribe member on the phone, somebody who has made well over $500,000 in the past 12 months, and it has been an awesome adventure. And you know we are going to hold his feet to the fire, put him in the hot seat, pick his brain, and find out exactly how he did it, so that you can do exactly the same thing. So, super excited to be with you guys here today, and with our guest, Adam Rae. Adam, can you hear me okay?
Adam Rae: Yes I can. Thanks for having me.
Tom Krol: Absolutely. It’s an honor to have you. You’ve had an amazing journey, and I want to pick your brain so that other people can be inspired, motivated, they can copy you and they can be ringing the victory bell. Have we sent you a victory bell yet?
Adam Rae: No.
Tom Krol: Well one is coming, my friend. I guarantee you that, one is coming, so that is awesome. So, thank you for agreeing to do this and allowing us to get some more detailed information from you. I know you’ve hit some really, really big numbers, and we are going to cut through all the fat. This is the no fluff, no BS zone, so we don’t want to waste anybody’s time. We want to get right to it. Before we do that, can you give people a little bit of idea about who you are, and how you got started, and a little bit about yourself. Are you a family guy, are you 150 years old or just 13 years old, and what does that look like? Tell us a little bit more about who you are.
Adam Rae: Sure. Yeah. I’m here in Colorado Springs, Colorado. My wife and I, we’ve been married about seven years. We’ve got three kids, a four year old, a two year old, and a six month old. And so life is, people ask us, and we describe it as never boring. How’s things going? It’s not boring. And with real estate, I’ve loved real estate since I read Rich Dad, Poor Dad when I was a teenager. The story goes, I was a mischievous kid, so I got in trouble a lot, and got grounded for close to a year once in the middle of my teenage era. And my father had all these books on his bookshelf, and said, “You can reduce your sentence if you read some of these books and write some reports, and we’ll talk about them.” And the very first book I picked up was Rich Dad, Poor Dad, and it’s been real estate for me ever since.
Tom Krol: Ah, I love it. What a great start! That’s awesome.
Adam Rae: Thank you. Yeah, it took me until about 2016, though, to make any money at it. I worked for a little development company out of college and rode that through the last crash, and lost some money in that, and then worked some W2 jobs to just make ends meet and and get back on our feet.
Tom Krol: Were you a good employee or a bad employee?
Adam Rae: Ah, I was a terrible employee.
Tom Krol: Aren’t we all? I will tell you, there’s not many common threads that run amongst the most successful wholesalers. If you took our top 100 students and you said, “What…” This is one common thread, we all stink as employees, every single one of us. So [crosstalk 00:04:01].
Adam Rae: I’d fake it for like eight months. I could fake it, but then it would all go from there. I was always really entrepreneurial, had too many ideas, vision, you’re running in a different direction. So yeah, I ended up always being a bad employee.
Tom Krol: I hear it. Well listen, here’s the deal. You have made more money in the past 12-month period than most Americans make in years and years of being a trapped in cubicles under that white fluorescent lighting. So what we will really want to do today with you is, I want to kind of pick your brain and find out what you’re doing, how you’re doing it, so that other people can be inspired and copy your success. Do you have a particular deal that you could tell us about, or something that you’re thinking that you’d like to share? Because it sounds like you’ve had a really excellent adventure here. We have a lot of people who are just getting started, they don’t really know where to start, and they are now looking at wholesaling. Do you have something that you can share with us, a particular experience that would be helpful, like one deal we could review?
Adam Rae: Yeah, the one we just closed, the most recent one. That’s the one that’s on my mind, if we want to go through that one.
Tom Krol: Okay! Let’s do it. The first thing I want to know about this particular deal is, one commonality that we’re always trying to figure out that new people want to find out, is they say, “Do these deals exist?” This is especially true if they’re real estate agents or brokers. “Do these deals exist? Can you really buy properties for 50, 60, 70, 80 cents on the dollar? Or are they just a big mythical beast, and you hear about them, but you never see them?” How did you find this motivated seller or this good deal? What did that process look like?
Adam Rae: Direct mail.
Tom Krol: I love it.
Adam Rae: Yeah. Direct mail, sent a letter, and I think it was the second letter that we’d sent him. I, last year, didn’t have the budget to mail in an eight week cycle. We’re in a mid size market, we’re not a major metro, but we’re not minor either, so my list, I can afford to… You guys coach and say, be consistent, whatever you do, be consistent, because direct mail, you need the frequency. And when I first started mailing in 2016, I would mail a list, and then it didn’t work. So I’d pick another list, and mail a different list, and it didn’t work. So then I’d pick another list, and then I’d mail that list, and then it didn’t work. And so the big thing that helped me get more consistency last year was just hearing you guys say, “Hey, pick it, stick to it, and figure out what you can afford to be consistent and just do it.”
Tom Krol: Pick it and stick it. I like it. I’m going to start using that term. But that’s true. He who has many mailings of small lists inconsistently does not do deals. This is the major takeaway number one. I love it. Very, very cool.
Adam Rae: Yeah, that’s the truth. So it was I think the second postcard we sent him, and he called us in April. Basically my whole shtick is, we really just want to help people. We’re not the best fit for everybody. And you know what, we’ll come out and talk to you and help you. We’re looking for people who are motivated, so we definitely qualify them on motivation. But then when we get out there, it’s, “Hey, my job isn’t to twist your arm and to help buying the house. My job is to help you figure out what your options are, regardless of whether we buy the house or not, and help point you in the right direction.” And if I can do that, I tell them honestly, that’s a little self-serving, because if I can do that and help you get where you need to go, you’re going to say, “Hey, start with Adam. He’ll help you get where you need to go.” And I’ll get referrals that way.
Tom Krol: One thing we always say, I just don’t want that to be missed by all of our listeners right now. What Adam is really saying is, in this business as a wholesaler, the definition of wholesaling, if you don’t know what it is, is you want to consistently be able to find discounted or “wholesale-priced” homes in your market. And the key here is, this is something we always say in the tribe, is you want to be a deal finder, not a deal creator. You are never going to convince anybody to sell their home at a discount. You just have to go out and find those deals. And that is the key.
And also just to put a finer point on that, and I’m sure Adam, you’ll agree with this, is that whenever a home seller anywhere in the country is selling their home, there are three pieces of criteria, and they get to choose two at the sacrifice of the one. And the sellers that we’re always speaking to are the ones who are looking for speed and convenience at the sacrifice of price. So there’s three categories, there’s speed, convenience, and price. Our sellers are always going to fall into the category of looking for speed and convenience and willing to sacrifice price. And that’s why we always say, this really is more closely associated to a pawn shop than a real estate business. So go ahead, Adam. I just wanted to make sure everybody was keeping up. I didn’t mean to interrupt you there.
Adam Rae: Yeah, that’s great. I’ve said the pawn shop analogy, even to sellers before. For me, it has never gone over well, but I’d describe it as, we’re CarMax for houses. People can walk into CarMax and sell their car today, and it’s going to be a third of what market value is, but it’s convenient and easy, and they’re trading the time and convenience for a little bit of a discount.
Tom Krol: That’s it. I love it. Very cool. Anybody who’s listening in, if you can grasp that concept, that is literally 90% of the battle with wholesaling. You want to buy properties cheap, and you’re only going to find a certain number of people, so stop wasting time, and getting frustrated, and down and out by trying to convince people who don’t really want that service. You have to find the people. That’s the art of the business.
So you do a mailing. Now, just for everybody who knows who is listening in, how did you choose your list? What list did you mail to in order to find that seller?
Adam Rae: This was Absentee Equity. And the funny part about it is, I just got on the phone with him, and he definitely had some motivation. He had a house here in one of our higher-end neighborhoods when he was stationed here in the military, we’re a big military community here in Colorado Springs. And when he was stationed here, he bought a property and became a de facto landlord by not selling it and just renting it, and he’s had it rented for years. Had a really, really rough tenant that destroyed it, was going to have to put some money into it. And so that’s why he gave us a call, it’s just the right timing, the right postcard on the right day. And he gave us a call and we started chatting with him.
Tom Krol: So, absentee meaning that the homeowner does not live in the home. That’s what an absentee owner means. And an equity means, when you mail an equity list, that is a list of people who owe less money than the home is actually worth. So if the home is worth 100,000, they might owe 50. So that’s the list that Adam mailed. I love it. That is a great, great list. Did you actually meet with this seller?
Adam Rae: So, he was out of town, and was going to be coming into town, and we were having trouble figuring out how to book the appointment. And I just followed up with him for a month trying to… When was he coming into town, he didn’t want to send us through the property. He really didn’t want to give us info on the property manager. And the funny thing is, I did not buy that house. That’s not the house I bought. And through the process of just being helpful and answering questions and staying in front of him, he was like, “Well, I think I’m going to rent it again. My property manager has got some stuff put together. I got a bid and it looks reasonable. I think I’m just going to rent it.” And I said, “Great, that’s a great option, I’m so glad that you arrived there. Do you know anyone else who’s looking to sell a house?”
Tom Krol: Oh wow. I love where we’re going with this. I did not know that you were going to say this. Let’s hear how that conversation went.
Adam Rae: And so, it turns out, his father-in-law lives in town, and this is the house that his wife grew up in, and it’s also in a great neighborhood, and this particular house hadn’t been updated since the 70s. And so he was like, “You know, a matter of fact, I’m going to be in town in the next six, seven weeks. If you want to come take a look at that one, we’re moving him into an assisted living facility, and I think we might be interested in seeing what your offer would look like on that.” So it didn’t seem like they were all that motivated, I couldn’t quite tell, but they were interested enough, and he had motivation on the other property. I knew he didn’t want to be grabbing another house and becoming a landlord if he was going to get it from the father-in-law.
Tom Krol: That’s awesome. Yeah, there’s a great book called Go for No! that Cody Hofhine loves. When I was first starting off in wholesaling, I used to keep a huge piece of paper on the front of my desk that said, “Don’t stop at the first stop sign.” Most people would have said, “Okay, thank you,” they would have been frustrated and they would’ve moved on. Because you took that extra five seconds and asked, “Is anybody else selling a home, or do you have any other properties for sale?” That’s absolutely the difference maker. That is incredible. I love it. That is such a key takeaway for everybody to hear.
Adam Rae: Yeah. So I went out and met with them. The first appointment, we just went over, I had some comparable sales of what I’d worked with. I actually print out some of the lower end stuff in the neighborhood, it’s what I call current condition value, of stuff that needs to be updated. So it’s in current condition, it’s not in perfect shape, it might need to be updated. And what does that look like for the neighborhood? And oftentimes for me, it’s been really effective just to take a screenshot of those current condition value properties that sold in the last 6 to 12 months from a sales perspective, and just show them, “Hey, Zillow has this thing valued at 360, but it sold for about 235. So 360,000 is what Zillow says, but it sold for 235,000. Why do you think that is?” And they look at the pictures. And I’m never trying to convince them what their house is worth, I’m trying to help them arrive at a decision based on information.
Tom Krol: I love it. Let it be their decision. Todd Toback talks about it all the time. I love it. Let it be their decision. I think that’s absolutely brilliant. I haven’t heard of that before, that’s a very unique approach. I think that’s very cool. That would definitely be effective. There’s no doubt about it.
Adam Rae: Yeah. So then we chat about the house, their goals, what they’re doing. They’re in from Texas for a week and are trying to make a decision. They’re meeting with a broker, they called other investors. So in a competitive situation like that, when I know that there’s other people that they’re talking to, sometimes I get a little vague. I’m literally just trying to help them figure out their options, and if they want to go with a broker, then great. So my conversation is literally what you guys teach. “Have you guys thought about listing it with a broker?” “Yeah, we have. We chatted with this person.” “Great, I actually know them, they’re a great broker, and they won’t do you wrong. If you’re looking for more money, that’s typically the route that most people choose. Why did you call me instead?”
Tom Krol: I love it. I just want everybody to hear. What Adam is saying, you guys, a lot of people will say, “Well, I’m in a competitive market, and there’s a lot of postcards on the table when I get to the property.” What Adam is saying right now is what we call eliminate every other option except for doing business with me. That’s what we call it in the tribe. Everybody should really be listening to this very, very carefully, exactly how he has this conversation. So yeah, go ahead, Adam.
Adam Rae: I’m persistent and maybe I’m just a little bit shameless with it, but I really propose every single other option they potentially could have, from renting it, to getting a loan to fix it up and rent it, to do they have credit cards that they could put the renovation on. And they say, “No, I don’t want the debt. No, I don’t want to rent it out. The other one didn’t work out. No, I don’t want to sell it with a broker. It takes a lot of time, and the negotiation, a thousand miles away, that doesn’t sound fun while we’re trying to move our father-in-law out. He’s not in bad shape, but he’s not in great shape, it’s already stressful enough. We were just hoping that you might be able to help us.” I basically got them almost frustrated that I was trying to convince them not to sell the house to me.
Tom Krol: Right. This is exactly, for anybody who is… You and I are both married, and I’ve been married so long that I don’t even remember any other lifestyle other than marriage. But the funny thing is, this is dating, right? The person who’s desperate and leaning in and chasing is always the person who’s rejected. But the person who is leaning back and, “Oh, you know, whatever,” they’re… It’s funny. We call it the dog, right? When you chase the dog, it runs away. When you run away, the dog chases you.
That is this entire business in a nutshell, what you’re doing with this conversation. Eliminating every other option except for doing business with me. “Are you sure you don’t want to be a landlord? Sure, it’s going to take a little while. You have to spend a little money fixing it up, but you get a…” “Oh no, I don’t want to do that.” “Are you sure you don’t want to list with a broker? You have to spend a little money fixing it up and it’ll be about eight months to sell, but you get more money.” “No, no, I don’t want to do that. Just buy the house.” “Okay. Okay. Maybe I can buy the house. I don’t know.” I love it. I love it. Very, very cool. All right, so you put the property under contract, and how did the price negotiation go?
Adam Rae: The negotiation really was soft. I always come in soft and it’s, “Hey, I’m still just trying to wrap my head around this. I really am just trying to help you figure out what your goals are. So if you could help me understand what you’re shooting to get for the house, then I can even tell you what I think your best option is.” And then I did that probably five or six times through the conversation. “No, no, no, you give us an offer.” And so then I come in really soft and say, “Hey, it’s a conversation. I’m just trying to wrap my head around all the details. There’s a lot of details in a house, and I think we’d love to be in a range.” And there’s a sales trainer out there that teaches what you call anchoring. “We’ve bought similar houses in the neighborhood for somewhere between 200 and 235, so we’d love to be somewhere in that range. I’m not totally sure, but if I was, what would that do for you? What do you think about that?”
Tom Krol: Who is that sales trainer, so we can give them credit? Because I love that approach.
Adam Rae: He does acquisition sales training for the real estate investing industry, his name’s John Martinez.
Tom Krol: Okay, perfect. Yeah, yeah. Very awesome. Very awesome. So you guys, again, this is one of those… The conversation we’re having with Adam is he’s a very, if you’ll allow me to define you a little bit, you’re a technical wholesaler. So what he’s saying, he’s speaking through these scenarios because he’s very familiar with them. But this is a podcast where you guys may want to listen to it twice. The techniques that he’s using, this is why he’s having such tremendous success in our tribe, because he’s talking about stuff that highly trained individuals do. If you’re just starting off, it might be a little bit difficult to do. But if you listen to how he’s positioning, this is why he’s having the success that he’s having. So, when it comes to a negotiation, setting that point and then doing a range is a really comfortable way, if the seller will not give you a number, this is a really comfortable way to do that in a situation like that. So go ahead Adam, I’m sorry to keep interrupting you like that.
Adam Rae: Yeah. My favorite, and if I could just give a book recommendation, our whole sales process is built off of two books. The first one is Never Split the Difference by Chris Voss on negotiation. And the other one is The Light Switch, and that’s all about building rapport. Both of the authors happen to be ex-FBI agents as far as their tactics go. It really is a conversation. And the purpose of anchoring is to try and reset their expectations based on what you might be able to do for them, so then when I come in on the high end of that range, or even higher than the anchor, now they’re grateful. Now they’re excited.
Tom Krol: I love it. I love it. All right, so this is all gold information. I know Never Split the Difference, and I’m definitely going to buy The Light Switch. As a matter of fact, I’ve got a trip that I’m going to be making here in about five weeks, so I’ll make sure I have that on my reading list. I want to say too, just for the people who are brand, brand new who are hearing this, what if they say, “Well Adam, I don’t have a contract. Where did you get the contract that the seller had to sign? Did you make that yourself, or get it off the internet? What does that look like?”
Adam Rae: On our first deal? On our very first one, I got them to commit to a number, and then I went and researched the contract, and then ran it by an attorney one page and sent it to them. Had no idea what I was looking at. Don’t even know the language in it.
Tom Krol: I love it. Now, I want to say this to be crystal, crystal clear of why Adam is on the podcast right now and he is a successful guy. Here is the thing. It was progress, not perfection, right? But then he made the critical, critical move that all winners make, that all successful people make, and he brought it to an expert, which in this case is an attorney. Anything that you do in this business, bring it to an attorney. Attorneys are our friends, regulators are our friends. They tell us what we can do and what we can’t do, and what we should do and we shouldn’t do. Here is the deal. Once you have that piece of paper, and it’s attorney approved from the right attorney in your state where you’re going to be doing the transaction, that’s familiar with real estate investing, now you have that air of confidence to know that you’ve got the right documents. So if you’re just starting off, guys, this is absolutely critical. So I really love that, I really love that, Adam, and I’m with you 1,000% there.
All right, so here’s the deal. Tell us a little bit more about the exit. What did you do with this property? And then most importantly, how much money did you make? We’re interested in that. So tell us a little bit more about the back end of the deal.
Adam Rae: The end of the negotiation was, I basically said, “Yeah, we’d probably be on the high end of that range.” They came back like, “He might need a little bit more than that.” They had power of attorney to sell it for the father-in-law. My offer was about 235,000. And they came back, and I got a text message. I actually want to read it, because when you get this back, you know that there’s some motivation and they’ve come back. I just want to read this text message.
Tom Krol: Let’s hear it. I love it. I wish I would have saved all of my messages from sellers when I first got started. I was doing deal after deal, and I didn’t save any of that information, but I wish I would have because man, I could tell so many good stories about all the different things I read into and… Oh, I loved it. It’s the best business.
By the way, while Adam is looking this up guys, let me just say this. Every single good deal in the entire country with real estate, whether you are Donald Trump or Barbara Corcoran or you are a brand new mom and dad just starting off in real estate investing, every single good deal starts with a discount of property. That’s why wholesaling is the cornerstone of all real estate investing. And that’s why, in my opinion, it is the number one way to make an absolute fortune in the shortest amount of time, and of any other way I could think of short of winning the lottery. It’s really been an amazing journey. So I want to encourage everybody to definitely check it out. It’s an awesome adventure.
All right, so Adam, do we have that text message from the seller? What do we got?
Adam Rae: Yes. So, they’re busy, and they’re in and out of town. Gosh this was, I’ve worked it for a little while at this point. And he texted me, it looks like it was on June 15th. And he said, “Adam, I spoke with my father-in-law this afternoon and went over your numbers on the house. He likes the idea of a cash as-is sale but was hoping for a little bit more. Can you work the offer in the $250,000 range perhaps? You’ll recall I said he likes round numbers. Personally, I see this as a situation where I’m fairly sure we can reach a mutually agreeable number and move forward if both sides can negotiate a bit. Let me know what you can do, and I’ll work with him. If at all possible, I’d love a number tomorrow.” So I knew there was motivation at that point.
Tom Krol: Right, there’s motivation, and I also want to say this. What else does it tell you that he texted you instead of calling you? The key to me… Well, you tell me.
Adam Rae: He’s busy.
Tom Krol: He’s busy, right, but also, does negotiating make people comfortable or uncomfortable?
Adam Rae: Uncomfortable. Texting is way easier.
Tom Krol: Yup. So you guys, a text message like that tells a whole entire story. You could write a novel about why Adam got a text message from the seller instead of a phone call. So, what happened from that point?
Adam Rae: So then I came back and I said, “I don’t want to stress my numbers too much based on what I told you, but I think the very, very best we could do would be somewhere in the 240s. Can you just see what he would be comfortable with?” And they came back to me at 245 and said they’d be good with a $245,000 sale on this property. The back end, in perfect condition, the house would be worth about, we comped it at about 395,000. And it needed to be renovated, and it needed to be updated, and all of that. Go ahead.
Tom Krol: Is that the current market value, or is that the value of the property after you would have spent money repairing it? Do you know what I’m asking?
Adam Rae: After repairing the property, it would have been about 385 to 395, but current value was probably somewhere around 315.
Tom Krol: Okay. So let’s say 315, I have a calculator here. And you were able to buy it for, how much was it, 245?
Adam Rae: 245, yeah.
Tom Krol: Okay. So that is, somebody who’s listening, who’s not driving, do the math. But as wholesalers, we typically want to buy properties for anywhere from 40, 50, 60, 70, 80, cents on the dollar, so that’s certainly will have fallen into that range. Perfect. I love it. Terrific. So, you agree on the price, I guess you bring it to title right away, and they start pulling title? Or what happens at that point after they sign?
Adam Rae: Yeah. I basically sent an introduction email. I’ve got a team now, so I’ve got a transaction coordinator, office manager, I’ve got a lead manager who now books appointments and answers the phones, and we all kind of do a little bit of this process. I hand it off to my transaction coordinator, office manager, and we do a handoff so that I can go find more properties. And she sends an introduction email to the title agent and to the sellers, lets them know what the timeline looks like, and the different times she’ll be calling them just to check in and give them more info.
Tom Krol: I love it.
Adam Rae: And so, that happens within 24 hours. She reached out and did a phone call, and we scheduled the closing date for August 3rd, and I went out and basically used your same cash buyer system of trying to find cash buyers. That was my big hurdle, really, getting in. That was my mental block, is I thought it was going to be really difficult to find people to buy these houses. I knew I could go find them, and so I was in a little bit of a different mental block than most people, but the big thing for me was, “Man, where am I going to find these people?” Well, if you just think about it the same, you advertise for him, you network, you build this list.
Tom Krol: Okay, so what was the exit strategy, Adam? I think you told me before the call started, this one was you actually ended up doing an assignment?
Adam Rae: Yes, we assigned the contract.
Tom Krol: Okay. Awesome. I love it. So this is the big question, right? The drum roll. What was the assignment fee that you assigned this contract for?
Adam Rae: $50,000.
Tom Krol: Woo-hoo! $50,000. Let me ring the victory bell. Hold on, hold on.
I love it. I love that beautiful victory bell. $50,000! That is an insane amount of money. Certainly more than most Americans make in a year, which is incredible. How long did that whole process take from the first phone call to you actually putting $50,000 in your bank account?
Adam Rae: I think it was April 15th to August 3rd.
Tom Krol: April. So April… January, February, March, April, May, June, July, August. Oh, so that was longer than most, and that was because it wasn’t the initial house, I guess.
Adam Rae: Right. I didn’t buy the house that he had called because he originally wanted to sell.
Tom Krol: That’s pretty funny. So, let me ask you this question. From the time you put the right house under contract to actually cashing that check, what did that look like?
Adam Rae: That was the 18th of June to the 3rd of August.
Tom Krol: That’s not normal.
Adam Rae: That’s not normal. They wanted more time to move out. Most of the time it’s 7 to 20 days on a closing timeframe.
Tom Krol: We’re about the same. We’re about 5 to 20, I would say, I have to look at that. But I love it. That is very, very, very cool. That is a tremendous, tremendous amount of money. I love it man. That’s awesome. So, first of all, what did you do with the money?
Adam Rae: It’s still sitting in our operating account. A lot of it’s going back into marketing, tithing. Some, think my wife might get a minivan too.
Tom Krol: I love it. You guys, by the way, you hear what Adam just said is tithing. Let me just tell you right now, a core tenant of our tribe is tithing. So I can guarantee you that that is a key, key, key part of his success is tithing. So I commend you for that. That is the most important thing. More importantly, certainly, than anything that we’re talking about about real estate investing or owning a pawn shop. So, very cool. I love it. That is incredible. So that was, you did over 500,000 in your last 12. What does your pipeline look like for this month now?
Adam Rae: We’ve got… I’m looking at the board right now through the window here in our office, a 600 contract right now.
Tom Krol: Wow. I love it. What is the estimated profit on that?
Adam Rae: Gosh, probably about 130.
Tom Krol: And is that gross? That must be gross.
Adam Rae: That’s gross. Yeah.
Tom Krol: Yeah. That’s incredible business guys, I love it. So, Adam, that is-
Adam Rae: I’m shooting for a million in the next 12 months.
Tom Krol: Yeah. So a million is… Let’s put Adam right in the hot seat. So how much is a million per week, how much you have to make per week? Because if you say $19,230.70, then I’ll know that you are 100% for real about that goal. Do you know what a million is per week?
Adam Rae: It’s $19,230.77 if you round up.
Tom Krol: That’s right. 77 cents. Yeah. I love it. I love it. So, very, very cool. He’s right on the money, so that is awesome. So great job brother. I love it. $1 million in this business is certainly attainable, that is a great goal to reach for. And if we could do a million net, that’s even better. But with these margins, that’s also possible. Very, very cool. I love it man. You are an air of inspiration in the Colorado market.
By the way, we are having our wholesaling summit, our next one is Orlando, January 25th, 26th, and 27th. It is only available to tribe members, but are you going to be able to make it to the summit?
Adam Rae: Absolutely.
Tom Krol: All right, brother. I cannot wait to spend more time with you, man.
Adam Rae: I’ve been pestering your assistant to figure out what the dates were because I know you were just locking them in.
Tom Krol: We are, we’re just locking them in. And I know a lot of people are going to do extensions, because it’s Orlando, January, so a lot of people with kids obviously, doing Disney and SeaWorld and things like that, Universal. But we’re going to be right in that area. The guest list is absolutely stunningly amazing. Orrin Woodward is going to be coming. If you guys don’t know Orrin Woodward, not only is one of my favorite authors, but he also built a $200 million company, and is just absolutely an inspiration, one of my mentors. Scott Alexander is going to be there, the author of Rhinoceros Success, certainly one of my most favorite people in the whole world. Joe McCall is going to be there.
Oh man, the list goes on and on and on and on. We’re also going to have a special guest who’s going to be there. And Clayton Morris from Fox News, if anybody watches Fox and Friends, he’s the host of that show, and a very successful tribe member and student. So I am looking forward to meeting you in person Adam again, and shaking your hand, and spending some time with you in Orlando. So let’s make sure we grab a bite to eat. Very, very cool.
All right brother. Well, I’m looking forward to spending some time with you, so God bless. And one last thing, because I know you made two book recommendations already, The Light Switch and Never Split the Difference. Anybody who’s just looking to get into wholesaling, what would you tell somebody, you want to encourage somebody who’s in that cubicle right now, they’re driving to work, they’re working out in the gym and they really want to change their life. They want to do the right thing. They want to hit goals for themselves. And just like you, they have children, and they want to have dreams and aspirations for them. What would you encourage them to do, what would you say, what is your advice?
Adam Rae: Oh man. Figure out your why, and make it really, really clear. Because that’ll help you overcome just about any obstacle. It’s not complicated. It’s just not easy.
Tom Krol: Yeah, I love it. Adam, I’ve got to tell you. A lot of people, they always say figure out your why. But I want to encourage everybody who’s listening, because you are so right on the money, the thing about a why is that when you talk to people who are struggling and you say, “Well you have to do your why.” And they say, “Well, I know what my why is. I want to spend more time with my family.” And I’m kind of like, “Eh, that sounds okay.” Right? But here’s the reality of the situation. I have four children, you have three. After about two hours I’m kind of like, “Eh, I need a break. I don’t want to open a daycare.”
So let me just say this. I want to encourage everybody, if you don’t know what your why is, stop trying to be some moral authority on your why. Nobody is going to judge you on your why. You don’t have to tell me that you want to open up a children’s hospital. Your why can be a Lamborghini. Here’s what a why is, your why is whatever gets your butt out of bed at 4:00 in the morning. That’s what a good why is. I guarantee you, if somebody kidnapped the person you love or the people you love most in the world, and they held them at ransom, and you had to create $20,000 to get to that kidnapper right away, I guarantee you you’d be able to do it, because you have a very strong why. So don’t be a moral authority on your why. Nobody’s going to judge you if it’s attracting the right spouse, or getting a really cool car, or a mansion on the water. Let that be your why, but you’ve got to get one. I agree with you on that.
Adam Rae: I’m a big believer that you should have two. You should have a selfish why and a selfless why. And the selfish why for me is, we want to take two months off and travel and live in another country for two months with our kids to give them a global perspective, to help them learn that America is not the center of the universe.
Tom Krol: I love it. Are you homeschooling your children or no?
Adam Rae: Well, they’re four, two, and six months, so we really haven’t broached that yet. We haven’t decided. My wife was homeschooled, so we’ll see. But I don’t know that I want to be a homeschool teacher. So we’ll see. So that’s our selfish why, and then the are our selfless why is, we want to do $1 million in the next 12 months gross. We set up a fund, and we’re having our team members get to contribute and choose where some of that money goes. So we set up a fund to give away, and we’re trying to give away above and beyond what we normally give, another $100,000 off of that million that we’re shooting for. And so that’s our selfless why. And depending on the day, one or the other is what I’m thinking about when I get out of bed at 5:30 in the morning every day and keep going.
Tom Krol: I love it. I have absolutely no doubt, and I will tell you this, I would love to interview you at a year from now and see where you’ve got, because I know you’re going to be at $1 million, that’s for sure. As a matter of fact, you don’t even have to double, you have to less than double what you’ve already done. And of course, you’re in the tribe, so jump on those support calls, anything I can do to help you get there, sequencing your mail list, things like that, let me know. Adam, I appreciate your time, your inspiration. You are a great man and I am honored to have been even a small part of your journey as a coach here. It’s a blessing for me too. I’m really excited to have spent some time with you, and I cannot wait to see you in Orlando and hang out and grab a bite to eat, so it’ll be exciting. Thank you again.
Adam Rae: Thanks Tom. Talk to you later.
Tom Krol: Okay guys, that was Adam, right? He is a rock star among rock stars, one of our very cool rhinos in the tribe, and I am honored to be on this journey with him. If you are interested in wholesaling real estate, go to www.wholesalinginc.com. Check us out there. If you like what you see, fill out the application, and if we like what we see on the application, we might even just invite you in to be a tribe member. All right guys, until next time, we’ll talk to you soon. Have a great day everybody. Bye. Bye.