Posted on: March 10, 2021
WI 641 | Quit 9 To 5

 

Everybody dreams of quitting their 9 to 5 and having control over how to spend their time and their money. But when is the right time to quit? Well, get answers from those who did it firsthand. Today’s guests are seasoned business partners Brian Rhodes and Greg Butler. They have a shared journey of starting and quitting their jobs on the same day to pursue real estate investing full-time. The duo chats with Chris Arnold to share the dos and don’ts of knowing when to walk out and drop everything. With a six-figure deal coming in soon, it’s easy to guess how they’re doing now. Brian and Greg also discuss the benefits of using radio channels to attract highly motivated sellers and how they managed to close three deals in just 90 days. Don’t miss this opportunity to learn how Brian and Greg got their break from the rat race!

When is the Right Time to Quit Your 9 to 5 – 4 Deals in Your First 90 Days

Episode Transcription

We’re going to talk with two business partners. I’m excited for you to hear their story. These guys are approaching a thousand deals, but we’re going all the way back to when they were working the 9:00 to 5:00 and the question is, what are the dos and don’ts of knowing when to walk into your boss’ office, drop the mic and go, “I’m out. I’m doing this thing full-time.” We have a lot of investors and that’s your dream.

We can’t wait to quit the 9:00 to 5:00 that we’re doing. Get out of that rat race and do what you’re passionate about and that’s real estate investment full-time. Secondly, we’re going to talk about radio. These guys picked up radio. These guys are seasoned. You’re going to hear what they’ve done with it and the results that they’ve seen. Let’s hop in Brian Rhodes and Greg Butler. Welcome to the show. I’m glad to have you guys.

Thank you. I appreciate it.

Thanks, Chris.

Here’s a question. Brian, how long have you and Greg been business partners?

We have formed our first LLC and did our first deal in 2003, so a few years ago.

You said a few years. You guys got some history now. This is what’s funny about your story. You guys started working the same job or for the same company literally on the same day? Did I get it right?

That’s correct.

How many years later did you guys walk in on the same day and go, “I quit.”

It doesn’t matter how good you are at the game. If you sit at an oversaturated table, you’re going to lose.

It was seven years later. That wasn’t our plan, but that’s how it turned out.

I love the setup of the story. Two guys, two friends, which you guys knew each other. I think you said you knew each other from college, correct?

That’s right.

You worked for the same company with the ambition to get out of this company and literally did it several years later and walked in and quit on the same day. I got a question, Greg, you and I were talking about the dos and don’ts of knowing when to quit and one of the things you talked about was you were looking at the deals that you had in the pipeline. A lot of them were fix and flip, which meant they were going to be a longer-term payout. Now that you look back, you go, “It might’ve been why that we had some wholesale deals that would have given us that fast nickel versus the slow dime that we’re going to get on the flip.” Talk a little bit about like, “That was an a-ha moment.” I want to make sure that the readers take a look at what’s in the pipeline.

When Brian and I first started at our job, we didn’t anticipate being there more than probably a year or so at that. We didn’t know what the vehicle was that was going to get us to where we could leave our job. When we realized it was real estate investing, Brian actually found it through learning about creative real estate investing. He kept telling me about it and finally, I listened to some of Ron LeGrand CDs. When I listened to it, I was blown away. We started buying as many properties as we can buy. We had two construction lines of credit at the time and we started buying properties as fast as we could buy them. I had them all out on spreadsheets. They might’ve been ten houses that we had in a renovation inventory. We’re going to make $25,000 a house and then multiply that out.

You got about ten properties in an inventory all waiting to be rehabbed. You sit down with an Excel and you start projecting what you think is going to come through. I want to set the stage for this and then what happens?

We get into these extensive renovations and instead of taking four months, they took nine months or a year and we walked in. Brian and I said that when we got our second construction line of credit, that we were going to walk in the same day together and say give them our notice. The day that we got the green light, that we had another $1 million line of credit or $500,000. I can’t remember what it was. When the lender called and said, “Congratulations, you’ve been approved for this line of credit.” We were like, “That’s it. We’re done.” I was off that day. Brian was working. At the end of Brian’s shift, I came in and we walked into the boss’ office.

We gave him a 30-day notice, but they walked us out the door. We had some pretty good responsible positions that the company we’re working for. I guess there was a lot of sensitive information. They said, “You’re done.” They walked us halfway to our car. It was a very awkward moment, but looking back on it, it was neat to say that we started the same day together and left the same day together.

WI 641 | Quit 9 To 5

Quit 9 To 5: Be financially stable, take the fast nickel, have some passive income, or some way to sustain yourself before you just jump in.

 

I want to recap to make sure the audience pulls the principal here. This is a principle that I have written down that I’ve learned in the past and the way that I phrase it is, “Make sure that the cash register rings early and rings often.” What happened in your scenario, which is the lesson to learn from, is you were looking at what was coming down the pipeline, but those were rehabs. Those are what I would call a slow dime and what you guys needed was a fast nickel. The reason I say that is you might make $10,000 on a wholesale deal, but you might make $25,000 on flips. That’s why I call it the fast nickel versus the slow dime. The problem was you had many slow dimes and you were expecting those to come in and because of renovation and rehabs, you never know what’s going to happen sometimes. It didn’t play out the way that you had in your head.

Here’s what I want you guys to understand. If you’re thinking about quitting your 9:00 to 5:00, make sure that you’re looking at the inventory that you have, make sure you’re conservative and make sure that goes are all fix and flips. You need some wholesales in there. You need some things that are on the contract and that you’re confident about. I love that piece. Brian, I want to go over to you and your position. When I asked you, how do you know when to go in and drop the mic? You said, “I think we walked out a little bit too soon, but there was value in the pressure that it created.” Brian talked to us a little bit about that lesson and even though it might’ve been too soon, you looked back and go, “I’m still glad we did it that way.” Why?

Other investors ask us this often and it’s an important point because looking back, we left way too soon for some of the reasons you explained and some other reasons. I don’t necessarily know if I know what was going to happen in the future that I’d make that same decision. Be financially stable, take the fast nickel, have some passive income and some way to sustain yourself before you jump into it. The way I compare it to is it’s like I have kids. A lot of us that have kids, always ask you if you wait until you’re ready to have kids, you’ll never have them.

Maybe in retrospect, we wouldn’t have left our jobs if we had all the information. I’m grateful we did because it’s gotten us to the place and where we are now. Greg and I went in with that burn the boat mentality where once we said we were in, we were fully in. There was no going back to that job or to any other job. We were going to give it our all. I think that was the key element that’s helped propel us to where we are.

We’ve heard that the idea of burning all bridges of retreat and if you’re reading, that’s a tough decision. There’s a little bit of a leap of faith. I’m going to tell you, I personally believe, and this was my experience. I’m like you guys. I went in all in because there are people that step into real estate and they do it part-time and I was like, “I’m going to borrow a little bit of money to get me by,” because I was right out of grad school. I was broke. I didn’t have a dollar. I was more than broke. I had school debt at the time and I was able to scrounge up a little bit of money to borrow and I’m like, “I’m all in.”

I’m like you guys. I looked at people that tried to step into that slowly. I’m not saying that’s wrong. That might be the best path for you. This is not a black and white answer, but I’m like you guys. I went in fist first and I feel like that sense of urgency and burning those bridges of retreat is what allowed me to move forward to make it successful. I think you want to be strategic. I think you want to, as Brian said, make sure you got some cash reserves and so forth.

I think there’s the other side of the spectrum where you might be overthinking it and we’re telling you to just go. If you’re reading this and you know but there’s a little bit of fear and there’s always that well, “What if?” We’re telling you, you might be on that camp where the biggest thing you took from this blog or a couple of guys that go, “It’s not 100% certain, but it’s enough that you need to make a move and we’re all telling you, based on our experience, we’re glad that we took a little bit of a leap of faith on that.” I love the story that you guys are telling on this.

Let’s transition. Let’s talk about radio. I’m curious, Brian, you were the one that came across radio first. To understand your partnership, your strategy, marketing and those components, Greg is on the other side, on the sell side, doing some of the connecting, making the conversions and making the deals happen. What first attracted you to radio because you guys have been in the game a long time. I’m sure you can try a lot of different things.

In the last several years, we became very dependent upon one marketing channel and during COVID, that auction channel has dried up. We had to reinvent ourselves and go back to some of the old techniques that we had done many years before. We were trying all the normal channels, the direct mail and the cold calling. We did door-to-door marketing. We were doing all kinds of things and they weren’t producing the results that we needed and more importantly, Greg is a sales animal guy. He was getting tired of all the stuff you have to go through with the investors hitting the same list and everything else. He hated it. He would constantly give me feedback and I was like, “We got to figure out something different and new.”

Radio is not hard to set up but even better is once it’s up and running, that’s about it on the marketing end.

I’m an education junkie. I’m out listening to the podcast all the time. I kept running across you, Chris. I kept running across the radio and I would hear some of your students talking about this was a brand new technique. I didn’t know anybody else doing it and there were many advantages to doing it. I went to Greg, I was like, “Can we have the green light to try this?” He’s like, “Go for it. I’m sick of everything else.”

I want to hear Greg over here. Greg, you’re on the front lines, taking some of these leads and conversions and you’re over here almost pulling your hair out a little bit because what you are experiencing? Is it high volume of competition? What’s going on in your mind?

It’s frustrating, too, in this market, especially because things are so hot, the inventory’s low and everybody and their brother wants to get into what we do in general. My experience is that if I’m talking to a seller from a cold call outbound calling campaign and I’m talking to a seller, they’ve already talked to ten other real estate investors and in some cases more. They’ll say things like, “Tell me what your offer is. Whoever’s gives me the most money, that’s who I’m selling it to. I’ve got ten other offers. What’s your offer?” That’s the stuff that I’m used to dealing with and I’ll tell you, I’m sick of that because I can’t deal with that. It’s not me.

You’re over there frustrated because you’re having to deal with a high level of competition. Brian comes along and goes, “I got an idea at this point.” You’re like, “If it’s better than what we’re doing, I’m all in.” I want to speak to this principle. This principle is making sure that you take the right seat at the right poker table. Tony Hsieh talked about this after he had sold Zappos. He went on to play professional poker for a period of time and his whole conclusion from playing poker was the most important decision you make when you walk into a room is what table you determined to sit at because it doesn’t matter how good you are at the game. If you sit at an oversaturated table, you’re going to lose, or you’re going to find it very difficult to win.

Find yourself at a table where there are not many players or the players over there are less challenging than what you’re trying to accomplish. That’s a big difference. I see everybody hovered over here at the direct mail poker table or the RVM text blasting and then all of a sudden, I’m saying, “There is this other poker table over here called radio and there’s nobody at it.” I think that’s what you experienced. Let’s back over to you on your side. You guys decided to launch radio. What was the process and setting it up because you guys have done a lot of stuff? Hard, difficult. What would you tell the listeners?

When you first get interested in your course and you find out about it, you’re like, “I’m super pumped” You get into it but nervous because you had never done this before. I start watching your videos and I’m like, “This seems pretty simple.” Your team helps a lot. Grace on your team is incredible to deal with. She helps walk you through a lot of steps. I’m excited but I’m anxious at first. You start meeting sales reps with radio. I’ll tell you one quick, funny story about sales reps. I did my first meeting and I was nervous. I got through it. It seemed to go pretty well but it’s a sales rep. They’re going to probably make you feel overly confident. The next day, I go in for my second sales rep meeting. We meet at a Starbucks. I go in there and I picture the number we proposed. She spilled coffee all over the table and it goes all over me.

We are buying radio like we buy our deals at a deeply discounted price. I tell people fundamentally what you’re paying us to do is show you how to buy radio $0.25 on the dollar, which nobody’s doing. Everybody’s buying retail, but I love that she literally spills her coffee. Now, obviously, it took some negotiating, but you got the deal. How many stations are you guys on at this point?

We started our first station months ago. We also started our second station and we went live on our third station. The best part of this is that’s that same rep that spilled coffee all over me, we’re on hers.

WI 641 | Quit 9 To 5

Quit 9 To 5: We don’t get a ton of calls but the calls that we do get are very high quality, all motivated.

 

That’s what I’m talking about. It’s a beautiful story, the fact that you came around and closed that deal and you are right. The reason that we do so well on radio long-term is because of the price that we know how to lock it in and the strategy obviously is very particular on how to get that done. I want to jump back over to you, Greg. Radio is now up and running. I love it. You guys are literally right on track. I’m super proud of you. One station to two. Now you’re at three, you’re 90 days in. What are you liking most at this point now, Greg, about radio being on the frontline?

The biggest thing I like is that the people that call or almost call the people that call are sellers of houses, number one and number two, that the people that are selling houses seem to be highly motivated. It doesn’t mean that I’m going to make a deal or we’re going to make a deal with every single one but when the phone rings, I get excited and I don’t dread it like I do with others.

I want to say this. I’ve never heard someone say it, Greg, but I want to make sure we repeat it. You know you have the right marketing channel when you get excited when your phone rings versus you get a sense of dread.

We have different phone numbers for all of our different marketing and it’s like the bat phone. When I have a radio call coming in, it says, “Radio call.” I say, “The station.” When I get that, it doesn’t matter what I’m doing. I’m out on my boat fishing. My son knows that if the phone rings, he needs to be quiet. I’ll take the call. The interesting thing is we don’t get a ton of calls, but the calls that we get are very high quality. They’re all motivated. They all want to talk to me. I already have instant credibility. It’s an enjoyable phone call and I get excited because a decent percentage of the time, we’re going to make a deal with somebody.

We’re used to doing something like direct mail. We’re used to getting this high call volume and that makes us feel great but if you step back and look at that process, we know that over 50% of those calls are hate calls. Radio is like getting rid of all the garbage of direct mail and getting quality calls, which is a lot less. People have asked me, “Chris, what have you learned about radio so far, that maybe you didn’t understand launching it?” I thought and the speculation was that the primary people that were going to utilize radio were going to be super seasoned.

What I have found is, it is fantastic for the new investor because the last thing a new investor has is time. Time is being wasted on managing something heavy, like direct. Again, I’m not saying direct mail doesn’t work. If you’re using it, stick with it, but it is a lot higher maintenance. If you’re working a 9:00 to 5:00, you don’t have the luxury to sit there and have 100 calls come in and know that over 50 of those are wasting your time telling you to stop mailing their house.

You’d much rather receive ten calls and know that the majority of those calls are going to be motivated and that’s the huge paradigm shift that I see with our students coming in. They’re like, “I love the fact that this is so much lower maintenance than what I was dealing with.” On top of that, my biggest takeaway is like, “I have come to this conclusion. I believe that radio should be one of the first things you consider launching.” Why do you have to do phone call, RVM text blasting, just because that’s what everyone tells you to do? You’re looking at that going, “That’s the last thing that fits my personality. I got $1,000 to $2,000 a month to spend.” Go right into the marketing game, jump the prospecting and go to the marketing.

I’m telling you that might not be the case for everyone but if you’re reading, I want you to know that you have the freedom to do that if you think that’s the best fit for you. I want you guys, if you’re reading, to go over to YouTube. Subscribe to Chris Arnold – Real Estate. Watch this video because Brian and Greg are doing a homage background. Greg’s got the background with the waves and the palm tree, and Brian’s got his tropical background. You can always check us out on YouTube and put a face with the name. I want to go back over to you, Brian. Greg has given his answer on what he likes best about radio. What about you now? You guys have been doing this for a few months.

Two things that I would add and you were touching on it earlier but the simplicity of setting it up, it’s not hard to set up. Even better than that is once it’s up and running, you’re making sure your credit card payment goes through every month and that’s about it on the marketing end. That’s beautiful. There’s no other marketing channel that I know of that we’ve ever done that is that easy once it’s up and running. To turn it back to what you were saying about new people getting started, I would agree completely. Anything that gets in the way of you being successful, like direct mail, all those things, the list you have to deal with and the difficult sellers, those can be stumbling blocks to either get you to quit once you’ve been doing it or not get started. More to your point, Chris, I would highly recommend radio for new investors.

There is an authority status you get from radio.

It’s been a huge realization to me and I can tell you everyone around was making all the speculations more. This is going to be that big season, guys. I’m proud that the rookies have come in and proved all the veterans wrong and taken this tool and done incredible things with it. That’s what I like because I’m always rooting for the underdog, the rookie, the new guy. I was there as well.

I think it’s important and I’ve heard you mentioned it before, but I want to give it credibility on the authority status you get from radio as well. I’ve gotten calls and texts from a bunch of investors, even investors I don’t typically talk to, for years. They’re hitting me up on the phone and texts saying, “I love your ad. It’s awesome. How’s it doing?” It hasn’t come to fruition yet where we get a direct benefit, but I know at some point, because of that authority status, we’re going to get several benefits down the road that we’re not even counting in. That’s not why we did radio. It’s a nice bonus on top.

The authoritative marketing is key and now, with the advent of where social media is, Instagram to YouTube, I’m telling you authority marketing is taking over. Back in the day, I don’t think it was as important because there were less ways you could do it. What did you have? Television? Radio? Now you got podcasts, Instagram, YouTube. It’s endless. The more authority that you can build for your business, it’s going to put you ahead of the competition.

I believe it’s more of an authority game on the marketing around right now as well. If I’m listening, the most important question I always ask is, “That’s great. You love radio. It’s got all these benefits.” Let’s talk about some numbers, some deals. What I have and let’s walk through this, is you guys have been up for 90 days. You guys have contracted four deals and you’ve already closed on three. You’ve done that in the first 90 days. Is that right?

That’s right.

That’s the other thing I like about radio. We’re talking before about making the cash register ring early. The thing I like about radio is you don’t have to wait six months to get a deal. I find that the majority of our students contract deals within the first 90 days. That is the majority. You guys have come in and not contract, but closed on three. Let’s talk about one of the deals. I love too that you guys wholesale, fix and flip, buy on terms. We were talking about one of the deals you guys have done. You got a seller financing deal that you guys have picked up and gone to seller finance and it looks like this is potentially a six-figure deal. Give us a high level of this deal I know you’re excited about it.

It was a unique situation of property out in and out in the country. I wasn’t confident in what it was worth, but in talking with the seller and how it came about, we bought the property into the teams. It was an interesting deal for multiple reasons, a lot of stuff strewn about the property and interesting things about the house itself, the location and stuff. We ended up closing on it and we decided that it would make sense for us to sell it with owner financing. We listed it with a realtor in order to get more interest in the property.

We’re going to make well over six figures on the deal that we were bought in the teams. The good thing about it also is we’re doing it with seller financing. We’re getting an interest rate, 9% ballpark and obviously, we’re not paying taxes on all the profits that we’re getting from it. Right upfront, that’ll be down the road, a little bit here and there each year down the road, but we also got enough money down to pay us back for what we had in the property and then some.

WI 641 | Quit 9 To 5

Quit 9 To 5: Direct mail and all those things in the list you have to deal with and the difficult sellers can be stumbling blocks to either get you to quit once you’ve been doing it, or not get started at all.

 

You got a nice substantial down payment. You set this thing up on a solid interest rate, and now you’ve got a deal that’s going to pay you more than once and that’s going to produce over six figures. Here’s what I like about radio. People ask me, “Is it for a wholesaling fix and flip?” One thing that all of us investors have in common, regardless of what our exit strategy is. If it’s subject to, owner finance, building a rental portfolio, the one thing we all need that we all have in common is we need motivated sellers, bottom line.

The job of radio is to tee you up a motivated seller. What you do with that motivated sellers is completely up to you and it doesn’t matter on the radio front. You can use whatever exit strategy that you want. That’s why we see people coming in and utilizing radio for all kinds of things underneath the spectrum of real estate. I want to wrap up here and close this out. Brian, somebody is reading, going, “This radio thing doesn’t go away. It’s here to stay,” which it is. I get the skepticism. I’m super skeptical by nature, but somebody is a little bit on the fence going, “Should I do this radio thing?” Brian, what would you tell him? Just your experience opinion to add value.

It’s a pretty easy decision for me. Once you realize it’s not a ridiculous amount of money to invest, your ongoing marketing costs are at least on a par if not, I think cheaper than most marketing channels.

What do you spend in a month? Let’s throw that out there.

With our third station, we’re right at above $2,000 a month.

Three radio stations, $2,000. Keep going. I want to make sure people understood that.

When you tell most people who are like, “That’s all?” You’re like, “That’s all.” It’s not going to kill your budget. The quality we talked about earlier is just ridiculous compared to any other marketing channel we’ve had. I would 100% do it and we explained our first deal. I can’t do the math really quick, but that’s many years of decades if that’s going to pay for radio marketing on that one deal. We love it. Our only challenge now is we need to get more channels fast. I would highly encourage anyone to get started.

Greg, Brian, I love that you guys came on. I love your passion for real estate and the fact that we are Wholesaling Inc. We’re able to give you a true valuable tool. That’s what I’m always excited about. It’s cool, as I say, to do deals but it’s much more fulfilling to give somebody a tool and watch them do deals and get excited about it because, in my opinion, that’s where the real significance is found in coaching and helping people. Thank you guys so much for coming on and to the rest of you guys, we will talk to you soon when we add more value.

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About Chris Arnold

Chris Arnold is a 15 year Real Estate veteran who has closed over 2500 single family real estate transactions in the DFW metroplex. Chris is the founder of multiple companies that are managed by a US virtual team, which allows Chris to run his organizations while living in Tulum, Mexico full time. His passion for leaders has led to the creation of Multipliers brotherhood which serves the top 5% of real estate entrepreneurs out of the US. Most recently Chris has launched his REI Radio coaching program. This program is designed to teach real estate investors the marketing stream that everyone knows about but NO ONE is doing!

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