Posted on: November 10, 2021

WI 816 | Closing Deals

If you’re thinking about starting a real estate investing business, this podcast with Chris Craddock and two incredibly successful wholesalers, Tyler and Andrew will teach the ropes of the business and show you how to get started.

Join the conversation as they share their experience from months of getting nothing to now closing 8 to 10 deals a month and their secret to closing over a hundred deals in just a year from when they started.

I’m so excited to be back here with some of my good buddies, Tyler and Andrew. They have started their business and gone from zero to the whole goal. If you have ever read Zero to One, which is an amazing book, how do you get that first deal? They have gone from $0 to $60,000 in their first year killing it. They came in and jumped into REI Revive to monetize their dead leads and pay for all of their marketing.

The questions we are going to dive into are, “What has caused the quick success? What is something that we can learn so that when we are jumping in, we can move quickly?” I’m excited to hear about that. Andrew and Tyler, tell us about yourself. What got you into real estate? Tell us when you started and where you are.

To go way back, we were good buddies from college. We’ve got into it together looking to a couple of buddies who are trying to get into real estate. We were trying to purchase a flipped home from a wholesaler. Tyler and I didn’t know what wholesaling was. We thought we were going to be rental property owners or house flippers. We have no idea what the concept of wholesaling was. We learned it from the wholesaler we were trying to buy that property from.

Thankfully, that property didn’t work out. We probably would have failed. He and I aren’t cut out to do house flipping, rental properties or anything like that. Once we realized what wholesaling was and dug into that a little bit, it hit both of us like a ton of bricks. This fits our skillset so much better than anything else. He is in sales. I’m in sales. It’s the concept of, “If you are good at sales, you can get these contracts and then resell them.” We took off with it. It was a good lesson learned.

It goes back to the Dale Carnegie book, How to Win Friends & Influence People. He says at the very beginning of it, “If you are good with people, there’s no other skill in life that’s more powerful.” Sales are being good with people. One of the things we talked about in our personal team is, “All sales is leadership, like leading people to where they need to go.” That’s an awesome tool that you have cultivated and learned. It served you well in life. When you jumped into wholesaling, how long ago was it that you jumped in?

Last October 2020 was our first wholesale deal. Tyler and I were talking about this. Looking back at what we know now compared to what we did then, and the buyers that we have now, we’ve got hosed on that deal. That was our first one. It was a great feeling, though. You get that check and it’s like, “This is great. It fits our skillset.” Tyler and I were hooked.

You really have to do your due diligence in interviewing people.

You are a year into it. I know it takes some people a long time to get started so that we can understand where you have come from and where you are, how many deals a month are you averaging?

We came a long way. When we first started, if you do a deal, it’s zero. It’s 3 and then 2 months of nothing. Tyler, correct me if I’m wrong. He is a little bit better with numbers. It’s about 8 to 10 deals a month. The prior month, it was 8 to 12. We started to get a consistency where we were all over the board before that.

You are going to be doing over 100 deals is what you have scaled to at this point. Do I hear you right?

Absolutely. We hope 2020 is a little bit more than that because of the ability that we have had. What we have learned is completely different. We are implementing some things. Hopefully, it’s more than that.

Hopefully, it’s anywhere from 10 to 18 on average a month instead of probably 8 to 10.

Let’s dissect this. One of the things there is you see the vision as bigger than you are doing. Everybody reading, I want you to understand, “You see it and then you live into it.” A mentor of mine, Gary Keller, talked about this when he was talking about making your first $1 million in a year with real estate. He says, “First, you need to think a million, grow some million, and net a million, which means take home a million.” You make a top line, and then your bottom line takes home on that.

What I’m hearing from these guys that I hope everybody is taking away is, “First, you think it, act into it and then it comes to fruition.” They have big dreams but then they are doing the work to get there. Let’s talk about doing the work to get there. What does your day-to-day look like? What are you doing to procure these deals, get them closed up, and make it happen?

Tyler, I will share what I do and then we will go into your role. I will start by saying that he runs the show. Without him, our business would collapse.

WI 816 | Closing Deals

Closing Deals: We work like a battery. Our synergies is great. We both have similar goals, similar mindsets. That’s why it really structures everything nicely in our business.

 

Let me break this down too because I don’t want to go over this. Here’s an awesome book. It’s called Rocket Fuel. It talks about the visionary and the implementer. A lot of times, what happens is there’s the visionary that has the big dreams. They feel like the implementer moves too slow because the implementer tends to make things pretty, nice, and work well. The implementer oftentimes feels like the visionary is reckless and doesn’t like to say, “Let’s go. Who cares? Ready, fire, aim.”

One of the things that you find is when you can get those two people in the same room that have trusted for each other, that they both want the same thing, and that the other person isn’t just reckless and missing out but has trust, then you get these two chemicals. In the book Rocket Fuel, it says that they come together and make this a good explosive thing, which is what we see right here. I didn’t want to miss that. That is what is needed to scale an organization. It’s the person who has the big dreams and also the person who is able to put these dreams to fruition.

Chris, you are the second person that has told us to read that book. We’ve got told by another large wholesaler in Cleveland that we needed to read Rocket Fuel because it exactly identified who we were. That’s something else because we listen to a couple of different podcasts. We read some books. You always hear about how maybe partnerships might not work out.

Honestly, for Andrew and me, it couldn’t work out better. We work as a battery. It’s what I tell everyone. Our synergy is great. We both have similar goals and mindsets. That’s why it structures everything nicely in our business. His personality traits might be a little bit different than mine but we both think on the same page. Both of our differences make a positive. It works out well.

To your point, it’s funny you bring that up because that is me. If I didn’t have him to slow us down to implement some things, I’m the guy that I’m like, “We’ve got 80 leads in our CRM. I don’t have time to do anything but call them.” Tyler makes sure that we sit down once a week. We talk about strategy and big picture stuff. If it wasn’t for him slowing us down and doing that type of stuff, we wouldn’t have implemented some of these things that have helped us get consistent. That’s why we work so well together. It’s perfect.

Here’s the takeaway, and then we are going to jump into the next piece here. For the person who wants to make sure that it’s implemented and done right, you’ve got to have trust for them that they still have the same goals that you have. For the person who is the visionary, you’ve got to have trust in that person. He isn’t just wanting to go fast, be reckless, blow up everything and make it ugly but then that person is making things happen. It’s that combo of both.

If there’s a wall and somebody says to make a door, I’m going to take a sledgehammer and open up this big thing. I’m like, “You can get in and out but it’s not going to be pretty.” I’ve got all these people in my life who will come in, trim up the door and make it look nice. Even though it still works, I took the sledgehammer. You can get in and out but they are going to make it pretty. You have to have both. Otherwise, David will probably overthink it and take way too long. I will probably underthink it and take it way too fast. When we put us both together, it makes it right and good. What is it that you have been doing to get to where you are?

Lead-gen wise, it has been one type of marketing for us. We need to implement some more things but it has been great for us. We do texting. We will buy data from PropStream or BatchLeads. We will implement it into Lead Sherpa for a text blasting system. We are sending 2,000 to 3,000 texts a day. We have a couple of VAs who will then filter out the responses to those text messages. Any wholesaler who is reading this knows there are certainly some very negative ones.

Anyone who is open to having a conversation at all about selling their home regardless of price, I then hop on the phone with. I try and close them on the phone. That’s our model. We try and get stuff locked up over the phone. Tyler heads out and has a more one-on-one intimate conversation with that homeowner in-person to build trust with them and lock up the deal.

You’ve got a game plan right there. If you need a game plan, now you have one. You have overhead. What does your overhead look like a month? I know that you have been able to keep things relatively inexpensive in the scheme of things. Some people may say that’s still a lot of money. In the scheme of things, you keep things from getting out of control. If you are ever going to scale a business, there are a couple of principles you’ve got to learn. 1) Lead with revenue. 2) Your business has to earn the right to build out its org chart. You have to be able to be bringing in money before you hire the next thing.

Pay for coaching, pay for better coaching, pay for masterminds.

I was talking to a guy. He started spending money on everything like tons of VAs but hadn’t been closing deals. He burned through all of his money. Until you do a deal or two, every time you do a deal, then you can take that money and build up the next piece. You have your monthly spend. I’ve got to know you through the REI Revive Program. You were able to implement this pretty quickly. Can you talk to us about why you decided to get into REI Revive? What was your thinking when you heard it? What was it that resonated with you? Why did you decide to jump in? How has it been going?

To speak to the revenue thing or the expenses, Tyler, what is our monthly spend?

It’s around $8,000 or $9,000 a month. That’s with software, VAs and leads.

It didn’t start at that. You built that out by being successful and then built it smart. For all of you who are rolling the dice and saying, “I hope this stuff works,” but you haven’t closed the deal yet, they pulled and built it smart.

One of the things that led us to be consistent is a mentor of ours talked about, “You’ve got to spend every month on marketing.” That’s how we’ve got to this point. To speak to the REI Revive, Tyler was listening to a podcast where he heard you, Chris. He shared the concept with me and it blew me away. It’s one of those things where you think it’s like, “How did I not think of that?” We weren’t doing it.

When I started to realize the number of conversations I have every day where there are people who have their hands up, they are ready to sell. I simply toss the lead to the side because, after ten minutes on the phone with them, I can’t get them low enough where it works for a wholesale deal. These people still have their hands up. Oftentimes, they want to sell for still under market value. We were doing nothing with those leads. When we were introduced to your concept of REI Revive, it was a no-brainer.

REI Revive is learning to pick a good real estate agent and hand off the leads to that agent. One of the things a lot of people have done and said is they are like, “That’s such a great idea and no-brainer. I don’t need to jump into REI Revive. I will send it to the agent. The agent will do it.” What we found over and over again is that you throw it out to the agent and it disappears in a wasteland because they are not following REI Revive more than any other system. If you don’t follow the system, you don’t monetize the leads. They don’t come back to you. Can you tell us what was it that made you decide, “This is worth getting into the program, following the color by number system and doing it versus trying it on your own?”

WI 816 | Closing Deals

Closing Deals: We really try to get stuff locked up over the phone and has a more one-on-one intimate conversation with that homeowner in person to build the trust with them and to lock up the deal.

 

Number one is Tyler and I are huge on paying for coaching and mastermind. If there’s an opportunity to shorten the time frame for us learning a new skill, we are so in on that. Learning your background is a no-brainer. The piece for me that stood out, so we have to follow this program to a tee, is the interviewing of the agents.

When we first heard about your concept, I had in my mind a couple of agents. I’m like, “It’s a no-brainer. I will send the leads to him.” You do quickly realize if they are not following the model exactly and you are not following the model exactly, those leads get lost. You have to do your due diligence in interviewing these people. You can’t just, “This guy is great. He will work out.” You have to take the time to walk them through it and follow it step-by-step.

I appreciate that. That goes back to that whole ready, fire, aim where everybody is like, “It’s a good idea. Let me do it without having a system or model in place to follow.” I sell coaching. I want to throw this out. Before I ever sold a product or did anything like that, my rule of thumb was that I always wanted to spend 10% of what I make on personal development, coaching, masterminds and all of that. I spend over six figures every year on masterminds and personal development for me personally.

I love what you said. It compresses the learning curve. Tony Robbins talks about taking decades and turning it into days. Anybody reading can tell you are smart guys. All this stuff that you have figured out, you could figure out on your own. If it took you three years to get to where you are, how much money would that have cost you? Is it worth what you paid for coaching? That’s the way I see it.

One of the first masterminds that I ever joined, I spent about $15,000 on that mastermind. I could attribute over $250,000 of gross income that next year to what I learned from the people in that mastermind. It’s a no-brainer but so often, people want to figure it out on their own. They don’t realize how much money and time it costs them to do that. You are at a point where you have been doing REI Revive for only a short time. My understanding is it looks like you are going to be able to cover all of your marketing expenses through REI Revive. Is that right?

Yes. Tyler doesn’t even know this yet because I’ve got a text about it right before we hopped on. We’ve got another listing agreement. They are a bit of a smaller revenue-wise deal but it’s going to cover our marketing spend. It will be about $8,000 to $10,000 for leads that we were going to do nothing with.

Think about this for everybody who is reading this. If every deal you make, you get to keep what you make, how is that not a game-changer? It’s crazy.

There’s also another value to REI Revive other than just monetizing on the leads that we might have out there that we can’t sell for whatever that might be. There’s a big benefit to the program as well. For us, it was getting that push to get licensed, go out, and meet other people in the real estate environment, whether that be real estate agents or whoever that might be.

It also helped expand our network and figure out other opportunities that we might have out there. We figured out some bigger projects down the line with some other people with who we could be involved. It helps in that aspect as well. The money is nice but it’s those other things that are not said that is a huge benefit to the program as well.

The network is your net worth, you cannot underestimate the importance of paying for coaching investments.

I was at a mastermind with my friend Brent Bowers, who a lot of you know from Land Sharks with Wholesaling Inc. I’m going to interview him here not too long because he is doing this Revive Program. He told me one of the agents that he started talking to. He sent him a deal that he monetized for him. Immediately, that agent kicked him over a land wholesale deal and he made a fortune on it. One thing right there that Tyler said that we’ve got to understand is your network. Here’s a phrase that I have put in my mind forever, “Your net worth will always equal your network. Who you hang with will dictate your future.”

Another one of these cheesy phrases but I don’t know why my mind loves to collect cheesy phrases is, “Show me your friends and I will show you your future.” It’s 100% true. Tell me anything else that I should have asked you that I didn’t ask you or something here that we can leave everybody with. In a short time, you have gotten a lot of success. It’s this runaway train here coming. I’m so excited to be in this process with you.

I will leave with a tip. Tyler, if you want to get one, I hope I don’t steal yours. For anyone who is reading, pay for better coaching and masterminds. We are at the point where it’s one of those things where Tyler sits us down and make sure we talk about our big picture goals. We’ve got a dollar amount that we need to spend in 2022 on coaching.

WI 816 | Closing Deals

Closing Deals: Just keep going out there after your goal, because you’ll achieve it if you just keep trying enough attempts at the plate will get your head.

 

Our first mentor was a guy in Cleveland. His name is Steve Horace. He is a young guy who scaled up. That was our first coaching and mastermind that we joined. It’s the stuff we have learned from him. As you said, “The network is your net worth.” I cannot underestimate the importance of paying for coaching investment.

How about you, Tyler?

Andrew and I always talk about this, whether it’s wholesaling or anything in real estate, it’s a law of large numbers. Don’t ever give up. Enough noes lead to a yes. Keep going out there and keep trying because we have had some that didn’t work out in the past. We never hampered from our goal and vision. We kept going. I could tell everybody to keep going out there after your goal because you will achieve it if you keep trying. Enough attempts at the play will get you ahead.

There was a study where they interviewed all these billionaires. Essentially, they kept asking them questions. They didn’t use these exact words but one of them did, “They rebound quickly.” The bottom line is, if it was easy, everybody would do it. We get lots of noes. If you want to be successful, you’ve got to push through those noes until you get the yes. I hope everybody read this and took away many of these nuggets on how they have scaled as fast as they have. Much of that comes from being in a relationship with people who are showing in the path so that they do not have to find out the hard way.

You may think it’s expensive to pay for coaching but it’s a lot more expensive to not pay for coaching. If any of you are out there and you are looking to monetize those dead leads or you want to pay for your marketing expenses, go to WholesalingInc.com/revive, either myself or somebody from the team will jump on. We will look into your business and see if this is a good fit for you if we would be able to monetize those leads. This has been awesome. Thanks for being here with us. Keep killing it.

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About Chris Craddock

WI 806 | Scale Your Wholesaling BusinessA nationally certified Life Coach in Leadership and top 20 in all of Keller Williams Realty International, Chris Craddock is the host of the Uncommon Real Estate Podcast, a Realtor, and entrepreneur who runs multiple successful businesses in the Washington DC Metro area (and Richmond, VA). Chris and his companies consistently bring in over 5 Million in revenue year after year. His team, The Redux Group, sold just over $160 million in volume in 2020. Chris has been married for 20 years and is the proud father to six beautiful children.

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