Posted on: June 01, 2020

If there is one common misconception many people have about successful wholesalers and real estate investors, it is this: they have exceptional gifts and skills that sets them apart from the rest of the pack. For today’s astute guest however, there is one short answer: MINDSET.

Steve Pesavento fought many of the limiting beliefs most people have when they get into real estate and wholesaling. Soon as he modelled the actions and mindsets of the successful people he looked up to, his business exploded. In fact he went from doing zero to 75 deals and earned over a million dollars in revenue!

If anything, Steve’s success is no coincidence. It is a product of the right mindset and his commitment to make things happen. If your current mindset can use some upgrade, this is one episode you can’t afford to miss!

Key Takeaways

  • Why he prefers investing virtually
  • First market he picked
  • What to look for in a business partner
  • His thoughts on mindset
  • What prompted him to create “The Investor Mindset Podcast”
  • The importance of surrounding yourself with the right people
  • Game-changing books he recommends
  • Why it pays to invest in yourself and your personal development
  • How people can get in touch with him

RESOURCES:

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Episode Transcription

Lauren Hardy:
Welcome to the Wholesaling Inc podcast. I am your host, Lauren Hardy. If this is your first time listening in, welcome. You are about to experience the number one best wholesaling podcast in the world. If you are already one of our loyal listeners, one of our Rhino Tribe members, welcome back. Thank you for tuning in today for a very special episode. Today, we have Steven Pesavento in the house. Steven is one of the biggest virtual investors that I know and he’s also a great friend of mine. Steven, how’s it going?

Steven Pesavento:
Oh, it’s going great. Excited to be here.

Lauren Hardy:
I’m excited to have you. Thanks for joining us today. Why don’t you tell us where you live currently and where is your home market for wholesaling or investing?

Steven Pesavento:
I live here in Denver, Colorado, and my market is Raleigh, North Carolina, and we still do a little bit of business in Minneapolis, Minnesota. So I’ve always invested virtually since the very beginning.

Lauren Hardy:
And why did you always invest virtually? What brought you to do that?

Steven Pesavento:
So it’s interesting, right? I’m sure a lot of the listeners can relate to this, is that when you’re just getting started, you don’t have a lot of money, and you start marketing and you’re not seeing any results, it’s kind of scary. I was living in Southern California at the time, out in Orange County, so very close to where you are at. I had sent 3000 letters and I got 12 phone calls back. So I was devastated because I had spent a thousandsome dollars, which to me at the time was a lot of money.
I realized very quickly that I wasn’t getting the kind of response rate that I was going to need for the budget that I had to be able to continue sending mailers on a regular basis. So I started looking, well, where are there some other markets where it might be able to get a better return on my investment? Because I only had so much money to put into the business to get started, so I thought, well, it’s extremely competitive here, why don’t I look in a virtual market, and happened to pick one that is a really strong market.

Lauren Hardy:
What was the first one you picked?

Steven Pesavento:
The Raleigh was the first one. Definitely, Minneapolis is where I was born and raised. So I know that market, I have people there, I have a lot of reasons to go visit and travel, but Raleigh was just really strong. Right off the bat, I ended up partnering with somebody who moved from California out to Raleigh, and the partnership really was so that I had boots on the ground specifically for flipping houses. Now we’ve wholesaled quite a few houses, we’ve flipped quite a few houses, over 200 in the last three years at this point.
But what was really beneficial was knowing that person before they went out to the market. But I’ve also went and entered other markets. And it’s as simple as going and meeting some people, building some relationships or hiring somebody who’s actually going to go and do the work.

Lauren Hardy:
Yeah, that’s really cool. I mean, I remember when we met and I thought that that was really interesting. We were both like in living the same area and we both were like, “I think we need to do this virtually.” I think we were around kind of getting into the virtual thing around the same time. So it was really cool to be able to meet you. So you started out though house flipping out in your out-of-state market. So tell me, how did you go about that with working with your boots on ground? What was your relationship with this partner?

Steven Pesavento:
Going into a market virtually and flipping in that market is a very difficult thing to do. I think that I wouldn’t recommend it to new people. In this case, in this scenario, what I really wanted to do was flip houses because I saw so much potential, so much opportunity there, but I realized that my sweet spot was actually marketing, lead generation, sales, teams, scaling, building a business that is really based upon other people going out and doing each of the roles. The way that it would work for me, the reason why it made sense to partner with this person was because they had 10 years of experience flipping houses or more.
They were moving to that market for a lot of reasons, because California is a hard place to develop and the rules in Raleigh at the time, even though they’ve toughened up quite a bit, were a lot easier. So when I decided to partner, it was really clear what the roles were going to be. I was going to go and find the deals and he was going to manage the projects and then we were going to split the profits down the middle, 50/50, and we were going to wholesale a portion of all the leads that we got in to keep the operation running.
So it ends up being a great, in the middle type situation to be able to have somebody that can manage those projects while also being able to bring in money from day one from wholesaling fees, because on the flipping side, it might take three, four, five, six, eight months before you actually get a paycheck from that deal. So it was a nice little hybrid, although I really wouldn’t recommend it to new people getting started.

Lauren Hardy:
I actually say the same thing. Flipping out of state has never been very easy for me. All the horror stories have always sort of came from my out-of-state projects versus my in California stuff. So I tend to agree. I tend to tell people, try to sell deals wholesale when you’re trying to work out-of-state markets or virtually, because it’s really tough to manage a team when you’re not local.

Steven Pesavento:
Yeah. And I think it’s possible, so I don’t want people to create a limiting belief that it’s impossible to do. But at the end of the day, it’s much harder and it requires presence. So you’re going to have to go out to that market, you’re going to have to visit, you’re going to have to go and do those things. But it’s probably a better idea to wholesale those properties off or make sure that if you are going to do any projects that you’ve got some kind of agreement going where you make sure that you’re not going to get screwed along the way.

Lauren Hardy:
So, you mentioned that you have your partner that helped you with the flips. He was the boots on grounds and everything. If say somebody just wanting to go for it, they wanted to get into the house flipping business, what is something that they would need to look for? What were some qualities that you found were really helpful and it were made like a good fit, a good synergy between you guys?

Steven Pesavento:
Yeah, absolutely. So I think right off the bat, a great partnership, whether I’m talking about the one that I actually have or had, or I’m talking about what you should look for, the key is that you want to have different skillsets and different experiences. So you want to make sure that you have really clearly defined roles. For example, probably not the best partnership would be to people who are super sales oriented, super outgoing, or going out and playing that role. You want to have roles where each person is bringing something different to the table.
So in this instance, this person had a lot of experience flipping houses. They understood the construction side. So assuming that they were doing their job well and they were paying attention, they were going to properties, we would thrive on the house flipping side because they had the experience, they knew what to look for. Now, me, on the other hand, I happen to bring a lot of marketing, a lot of team building, a lot of sales type skillsets to the table.
So that was where I really thrived. So when searching for a partner, I think it’s key to really understand upfront what that expectation is, because what can happen pretty quickly is that one partner might think, “Hey, well, I’m going to do XYZ,” and the other partner thinks they’re going to do ABC, and if there’s not clear understanding from the beginning, there’s going to be problems. Then what’s great about real estate is that you can check in over time and see, okay, well, are we still in alignment with what needs to happen? And if you have to go your separate ways, then that’s just part of the program and part of the process.
But what we’re doing now today is we’re almost exclusively wholesaling. We’ve stopped flipping out of state. And that’s just because the risk versus the reward for us and for the lifestyle that I am creating, it didn’t make as much sense. It ended up freeing up a lot more time to be able to help people within our mindset members community, with the podcast, with some of the other real estate ventures that we have coming down the pipeline on the multifamily side.

Lauren Hardy:
Why don’t you tell us a little bit more, because that’s one thing I really do love about you, is that you’ve created a podcast all about mindset. I’ve listened to so many real estate podcasts and yours is very unique. So why don’t you tell us a little bit about mindset and what got you inspired to create a podcast all about it.

Steven Pesavento:
For all the listeners out there who love Lauren, I’m going to encourage you guys, go and listen to Lauren’s episode of the Investor Mindset. We’ll drop the number in the show notes here so you guys can easily go over there, because it gives a great intro to who Lauren is, some stuff you probably haven’t heard elsewhere. But what I’ll say is that my story, when I was getting started, I came from a background probably similar to a lot of you guys. Grew up at a house where I had great loving parents. They weren’t together, they had been divorced really early on in life, and money was a big challenge, right?
And I grew up believing that money was this scary thing that ended up just causing so many fights and so many different things along the way. So I had always wanted to be an entrepreneur because I saw the potential of what life could be like if I went out and did things on my own. Mindset for me really came into play because I had so much fear, so much fear of maybe I can’t do this, maybe I’m not that kind of person, I don’t really have family or friends who invest in real estate, I don’t really know where to get started, I’m too young, I don’t have enough money, I don’t have enough experience.
So I kept coming up with all these reasons, which are just limiting beliefs, about why couldn’t get started in this space. And I was really lucky, I had this experience that opened up my eyes to all of the potential that I really have, but it really all started with personal development. It really all started with understanding how the thoughts and beliefs that I have end up leading to the actions that I take. Through the Investor Mindset podcast, which has been so incredible, is that we’re interviewing extremely successful entrepreneurs and investors and really diving in to how they think so that we can all apply that within our own lives and really realize that, oh, well, if they can do it, then I can definitely do it.

Lauren Hardy:
I love that. I really do. I mean, I think mindset is so important. I know that I’ve really struggled in my career getting started. We started in Southern California and most of the people that started around us gave up. It was my mindset that really helped me persevere, and I said, “You know what? If these people can do it in different states, why can’t I do it in a different state? Why do I have to physically be present?” Let’s be real, with Southern California, the traffic, just to get somewhere, it took like two hours to get to a seller meeting.
So I would avoid going to seller meetings anyway because I didn’t want to sit on the 405. So I started getting practice, like closing deals over the phone, just to avoid like the 405 freeway. So, I mean, I figured, okay, mindset, if I can do this and it’s in California and I’m still doing it over the phone, why can’t I do it in Tennessee? Why can’t I do it in Oklahoma?

Steven Pesavento:
And it’s so true, that there’s so many limiting beliefs that people hold, these thoughts that really end up holding us back. They act like anchors. You guys have probably all heard about this stuff, but it ends up playing such a big role in your life. Even right now, I probably would ask yourself, “What do you think is holding you back from going after your dreams to get started in wholesaling or what’s holding you back from really advancing to the next level in the business that you’re already building?” Because right there, when you answer that question, whatever that thing is, whatever that belief is that you think is holding you back, is 100% some kind of limitation that you can overcome.
At the end of the day, there’s very few things that other people can do that we can’t do if we’re so committed to going after it. So I’m so grateful that I had spent some time learning about this stuff, listening to podcasts, joining masterminds, getting coaching and some training, because in my first year, I went from zero, never done a real estate deal, didn’t have any money in the bank, put everything on credit card in order to get started, to having 75 deals completed by the end of year one and over a million dollars in revenue in that time period.
I share that not to impress anybody, but just to show, just to show as an example of what’s possible, that when you really commit yourself to going out and creating a business that you want, that you can do it, because I’m not special and Lauren’s not special, and Cody and Brent and everyone else is not special. The only difference is that we went and did it. So I know anyone can hopefully take that and run with it and just realize that this business is not really that complex. It’s pretty simple. It just takes a little bit of effort to really succeed at doing and you guys could do that.

Lauren Hardy:
I mean, I even think when you say, “So-and-so is not special, I’m not special,” whatever, I disagree with you. Just kidding. But what is funny is when you meet a new… I’m sure with your podcast, when you talk to high-level, high-producing, high-net-worth individuals, when you spend a lot of time with these people, especially like I’ve done some business with high-net-worth individuals, you do realize like, “Oh, they’re just like me. They’re not that special.”
Getting started eight years ago, I had these ideas that these people were so much smarter than me and maybe they had a better start or they had, I don’t know, parents that were successful in business as well, again, all these limiting beliefs. And then you get to know them and you’re like, “Wow! They are not any smarter than I am, and okay, if they can do this, so can I.” So I mean, I recommend people, hang around people that you want to be like, because you’ll then learn that you’re just as great and smart and just as capable as they’re.

Steven Pesavento:
I couldn’t agree more. The moment that things changed for me, it was like pillars and it kind of was like a hockey stick of growth where I started investing in myself by listening and reading books and listening to podcasts and being mentored by people that I wasn’t actually in direct contact with. I didn’t know these people. I was listening to Tim Ferriss and Tony Robbins, and I was taking in these different people who are sharing the way that they think. And I was soaking that in and changing my thoughts and beliefs over time.
But then when I actually joined a mentorship program, when I actually started getting some coaching, when I actually got my own personal development coach, my business coach, when I joined a mastermind, that is when things really changed for me. As much of it was the process of actually joining and being in that community, it was a level of commitment that I had when I put money down on the table and I said, “I’m going to get the value from this that I need to get.”
Yes, I was fortunate I chose some great people to work with along the way, but what’s so cool is when you surround yourself with other people who are extremely successful, all of a sudden everyone else starts pulling each other upwards, as rising tide lifts all boats type of mentality.

Lauren Hardy:
So let’s talk about books that you recommend. What are the things that people can read to really inspire them? What’s your favorite book?

Steven Pesavento:
It’s hard to say a favorite book, but a couple that made a big impact. The 4-Hour Workweek was amazing because it really teaches you about this idea that there’s another way. If you’re sitting in a W2, you got a normal job, just start putting in some information into your head that could show you another way of thinking. I love a lot of Tony Robbins material. I think there’s a phenomenal program called Personal Power II, which walks you through this whole way of getting clear on what’s going on in your life. But there’s a book that’s behind me, and I know Brent Daniels is a big fan of it, but it’s called The Go-Giver.
It’s a book that is all about this idea of going and giving first and creating value and doing for others. Once I read that book, it really changed the way that I looked at business. I think a lot of people can get caught up in this mentality of, “Oh, I got to get mine first.” But when you start coming at it from this perspective of like, “Oh, I’m going to join a program, I’m going to join a mastermind or I’m going to go join a meetup community,” and thinking from this perspective of how you’re going to give to somebody else ends up leading to a lot more in return.
When I got started, I didn’t have any experience and I was pretty allergic to the idea of spending money on coaching. I’ve completely changed hundreds of thousands on mentorship along the way and it’s been extremely valuable. It’s the reason I’ve been able to build my business. But one of the first things that I did was I went and thought, “Well, I don’t have money. Let me see how I can trade or something.” So I went and made an offer to a local real estate investor who was speaking at a meetup in Long Beach.
I just said to her, “Hey, I’ve got this incredible skillset of building websites. I know you have a terrible looking website and you’re very successful, I’d love to build you a 10 or $15,000 website just for the opportunity to just follow you around for a little bit, maybe you’ll share some stuff along the way. The offer was so irresistible that there was no way she could say no to it. I’m going to build her something that is very expensive and tangible at the time and that she herself needed, but in return, it took her almost nothing to bring me along. If anything, she was excited for the opportunity.
So for all those people who feel like they can’t afford mentorship, well, first off, that’s a limiting belief. You definitely can, and until you’re ready to invest in yourself, you won’t. There’s a lot of ways to go out and get value back in return and go see who you can help along the way.

Lauren Hardy:
That is such a good idea, to exchange your talents with somebody. That is really smart. I didn’t know that that’s actually what you did to get started, but that’s really cool. How can people get ahold of you and what are you working on right now?

Steven Pesavento:
Yeah. So our big thing, we’re still wholesaling houses. We don’t see any reason to stop doing that. We’ve got a great marketing system down to really understand how to go out and find deals, close deals, and monetize those opportunities. I just encourage people to take the leap into something. I know Lauren has been doing business for a long time. She’s really an incredible teacher. If you guys are even thinking about getting started in this game and you don’t have a mentor, my biggest recommendation I have is to go out and find somebody who you know, like, and trust and try to think, “How can I be more like them while being myself?”

Lauren Hardy:
Awesome. Well, Steven, I loved having you here today and I’m sure everybody else got a lot out of this episode. So thank you for coming. We’ll have to get together soon, maybe do this again sometime.

Steven Pesavento:
Thanks so much you guys. Check out the Investor Mindset podcast. You can find it on any podcasting app. Keep on going after it and let’s keep making the world a little bit better of a place every single day.

Lauren Hardy:
Awesome. All right. Bye, Steve.

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