Posted on: May 16, 2022
WI 951 | Virtual Wholesaling

 

Yes, there are some difficulties when wholesaling virtually. Luckily Lauren Hardy has connected with Raul Bolufe to discuss things like the tools you’ll need and how to handle offers and how to handle showings virtually. Raul Bolufe is a real estate investor highly regarded for sourcing opportunities and creating customized real estate plans that drive revenues for buyers and sellers within the South Florida marketplace.

Tools And Resources For Virtual Wholesaling Ft. Raul Bolufe

Episode Transcription

We are going to talk about some higher-level wholesaling. We are going to talk with Raul Bolufe, who owns Capital Rise Investments. This guy is killing it. He is doing a lot of deals virtually, which I am super excited about because I do deals virtually as well. I want to compare notes, but he is doing a heavy volume. This is higher-level stuff. We have got a real pro. We are going to pick his brain and find out all the things. I want to figure out how he is doing so many deals virtually.

Raul, welcome to the show.

Thank you for having me. I am excited to do it. I did some research on you and I know that you do the virtual stuff as well, so I was excited to have this conversation with you. I am sure we can learn a lot from each other and your audience can pick up a bunch of things.

It is always fun to compare notes, especially with virtual investors, because there are not as many of us. When I do find someone who is bonafide virtual, I am like, “I got to ask you everything. I want to know all your processes and how you do things just to compare notes.” That is what I am going to do.

Real estate has been a local game, especially wholesaling forever. I feel like a lot of us are doing this virtually. Although there are some paths that have not been laid out, a lot of us are still figuring out how to optimize all these things because this wholesaling virtual stuff is relatively new. I am happy that we are going through some trial and error, and anything you want to go into about that.

First, let’s start with telling the audience about yourself, how you got started, and the company you run.

My first job here was as a pool lifeguard but I was not even in a nice pool. I was in a crappy pool here in Miami. I want to be a lifeguard on the beach. I only got a job at a full thing. I remember getting paid $11 an hour and I am like, “This is not for me.” Fast forward, my family had a car dealership here in South Florida. I started working there, washing cars and selling cars. I always see that the people who are buying nice cars own real estate. They are realtors or flip real estate. They are filling out credit applications and, “How much do you make? What do you do?”

I am like, “This guy is buying a Mercedes at 3:00 PM on a Tuesday.” I was like, “He is doing something right.” I did not have much money and searched on YouTube and podcasts like, “How to buy real estate with no money.” It is very common. That is how I found wholesaling. I found wholesale podcasts and channels like a lot of us do. Quickly, I was convinced that this was what I was doing next. Learning through the podcast, I saw that finding somebody locally that can be my mentor, coach, or someone that can guide me would be the best next step.

I started networking. I asked around, and I found somebody here locally that could show me how to do it. He took me under his wing and it took me three months to get my first wholesale deal. Once that closed, I quit the dealership. Even though it was a thriving car business, I was set to do that and make a lot of money, I said, “It is not for me.” I quit there and I started the wholesale thing from ground zero, from my mom’s house and my bedroom. I was 21 years old, and I never looked back. It went forward and within three months, I got the first deal, and in that first year, I got 40-something deals.

What year was this?

This was 2013.

I got it in 2012. It was a different time.

My average wholesale fee was $2,500 back then.

Still doing that deal volume was amazing. Was that local to you at the time? Where were you first local?

I was local until about 2019.

I was local until 2016. It was because the market was turning and it was getting harder to find deals in my backyard. Was it the same for you?

My first strategy when I started, the mentor I found in those local, was doing deals on the MLS. That is how I started blasting offers, talking to realtors, going to open houses, and doing the show, that whole formula. Once I saw that was working, I quickly got an office and I hired acquisitions agents to make 10 to 15 offers a day and do it all for us. That was my model until about 2017 or 2018. We started shifting to off-market stuff because MLS goes challenging. This is a business that you have to pivot quickly if you want to survive because it is a big game and big players are coming into it.

You have got the market that changes on you but then you also have competition that changes the marketing environment. I used to do direct mail. That was my game. I only know direct-to-seller. I was doing direct mail for the longest time. All of a sudden, my response rates were terrible. Direct mail was not working, and then I had to figure out how to get deals outside of direct mail like, “What else do I do? Cold calling or texting?” I went down that path. It is a combination of the market as economics and then marketing.

For us, in the MLS days, we are doing probably seven deals a month. Within a year, it got all the way down to one deal a month on the MLS. Let’s say there are 3,000 listings in South Florida at a time, so there are 400. The opportunities for us to get contracts shrunk by the market. It is not much better or worse than we could have done and the opportunities went down. We had to shift and figure out off-market things, which was mind-blowing for me. I would go to these masterminds and I am like, “You do how many deals off-market. That is crazy.” They would be like, “You are getting deals on the MLS. That is crazy.”

Let’s talk about what goes through your mind when you have to pivot like that. You are doing your business, you got used to things, and things are looking good, then all of a sudden, you are like, “This is not working anymore. What goes on in your brain psychologically when this happens?”

WI 951 | Virtual Wholesaling

Virtual Wholesaling: This is a business that you have to really pivot quickly if you want to survive because it’s a big game. It’s a big game and it’s got big players coming into it.

 

There was definitely a grieving period. I tried to push forward and prove that I could make this my business model work. After a couple of months and it is not working, I have to mentally let go like, “This is not my business anymore. This is not the way this is going to work anymore.” You start thinking, “I am Lauren. I am the direct mail girl.

I am rolling the MLS guy.” Detached from that story, tell yourself, “Now I am going to have to become a different person. This business can have to do a different thing.” That was challenging. It took me one year to cut ties with that and completely shift everything to direct-to-seller marketing. It was a challenge. Mentally, I had to let go and know that this is what is best for the business and for me.

I always referenced the book Who Moved My Cheese. Have you ever read that book?

No.

Let me explain this book. It is a funny little fable about these mice that are going into a mouse maze. The cheese keeps moving, so the mice have to be creative to figure out how to keep feeding themselves. It has something to do with mice and maze, then getting their cheese, and then their cheese moves so the smarter mouse figures out innovative ways to get its cheese. I am probably butchering this. I read it many years ago, but you get the point. There is this stubborn period where your cheese moves and you do not want to admit it to yourself. You are, “I am going to beat a square peg into a round hole for three more months.”

Finally, you are like, “I am going to go broke. I better find my cheese and go move with it and pivot my business.” I even feel like we do that with employees if you have employees. Before we got on this, I was telling you, in some employees, there is a “who moved my cheese” moment for me where I am like, “Is this person a great fit or do we need to move on?” It is the same thing. You go through this period where you get stubborn and you are like, “I can train them. I can make it work,” then you have to come to terms and greet it eventually.

Not to get so woo-woo on you guys, but you are learning about yourself when you are in your own business, it could be a wholesale business or whatever, what you are tolerating, and the way that you react to things like on this marketing thing. I realized how stubborn I was back then. I do not want to let go and once I let go, a different part of me is like, “I can let go a lot easier now the different things that business, pivot, and change.”

I have learned the same thing that I have a hard time giving up. That is good in some ways, but then in other ways, you do not give up things that are not working. For people like us, we have to be glued to our KPIs. You go off of data versus gut feelings. Anytime your data make that decision for you, let the data make that decision.

To circle back real quick there to give people numbers. When the MLS was doing good and we are doing all those deals every month, we were about 30 contracts per signed deal on the MLS then, when it got closer to 2017 to 2018, it was 120 contracts per signed deal.

You are talking about offer contracts. Let’s use the word offers. You had to make 30 offers to get one deal. When your cheese started moving and the market started shipping, it went from 30 to 120 contracts on one deal.

For some reason, I was like, “Maybe we are doing something wrong when the data shows you that much.” If it is 30 to 40, there is something you are doing wrong, but for 30 to 120, there is something greater than yourself shifting things.

I had the same thing. It is weird because even the numbers are similar. I do not remember what it was when I first got started. For me, instead of contracts, we call it leads. In direct-to-seller marketing, you are thinking leads. For me, it was 30 leads in Southern California to get one deal. I remember it hit 100 leads to get one deal.

I was like, “That is a lot of people have to talk to, negotiate with, go back and forth and go to their house, and pet their cat.” That is why I decided to get out of California and go outside of the go-to virtual market. That was my hard fact to get me to move. That is interesting. Around 2019, you also, at one point, decided to do direct-to-seller marketing for your hustle business. Let’s fast forward. Tell me about your virtual model. How did it start?

Once we started going to the off-market or direct-to-seller, we started locally. Miami, Florida is a hot market like almost any market right now. Any major market is pretty hot. We realized that we could not get past a certain threshold every month in revenue in the wholesale only. It was very challenging to get more than five deals under contract every month in all off-market. I am like, “Something seems off here.” I have always been a part of masterminds, gone to real estate events, and educated myself.

I remember I met somebody that just moved to Miami. We had lunch and he was telling me about his virtual model. He was only in Orlando and Tampa, but he was doing text message marketing to virtual deals. He showed me some of his numbers. He was crushing it. I am like, “I feel like I could do that. That actually looks like fun and cool.” That is what started triggering my imagination of like, “If I could do that in Orlando, Tampa from Miami, maybe we can do this elsewhere.”

It started with doing text message marketing in the state of Florida entirely, then when text messaging started going sour probably, we are doing a lot of text messages and then we could not and then, “We have got to figure something else out.” I was at another mastermind. We were drinking at the bar with another friend of mine and he was telling me how he is doing PPC, Pay-Per-Click ads.

That made sense to me, then we started going that route. Now, how our virtual model looks is we do Google Ads, nationwide Pay-Per-Click ads, and some text messaging but not a whole lot. That is our second marketing channel. That is what our nationwide virtual model looks like now on the marketing side.

I totally know about the model that you are talking about. I am the opposite virtual investor, where I pick one market. I stick with 1 to 3 markets that I know well. I do not do the nationwide thing. I also do not do PPC, but I do know your marketing model very well because I had some friends do it that way. I have a lot of questions for you on that. First, let’s talk about who is on your team. It is not just you. Do you have a team that is helping you?

I will do it from the top down. Mainly it is me as CEO, then we have Louis. We have a COO who runs the sales team, marketing runs, dispo team and gets those reports and stuff. We have Louis and then a sales manager. We have four closers or salespeople who do close deals or acquisition managers, and then we have eight junior acquisitions managers who do not close deals. All they do is answer leads, dial and speak to follow-up leads.

When they get a good one, they transfer it over to a closer. We have a dispo team that makes up of three people. We call it dispo closer. We also have a dispo liaison. She is basically helping set up appointments and showings. She is the one who communicates with the seller the most. They have an assistant. There is a dispo team of three. We have a full-time recruiter in the office. His only job is to recruit salespeople every single week.

You learn about yourself when you’re in your own business and what you’re tolerating and how you react to things.

Sale is a revolving door, isn’t it?

When you commit only to sales, it is a revolving door. We are aware, which is why we got a recruiter to have people coming in through the door constantly. We trained them the best we could and gave them the opportunity. Our business is set up that the winners plan and the people who do not want to win will leave within the first couple of days.

I feel like we need a recruiter.

It depends on how you want. Some people are like, “I want a small team and efficient stuff and some people team.” We have decided to take the route to grow this business like a real estate brokerage grows their business. Real estate brokerages have been around and the big ones have been crushing it for years. I have seen that it is a more predictable model to hire, recruit salespeople, generate leads for them, let the winners win, and let everyone else walk out the door.

Do you have a book or a resource on how real estate brokerages run their business? How did you know?

I got in touch with a guy named Brett. He had one of the largest Keller Williams in Arizona. He became our coach and our mentor. We have been coaching and mentoring with him for years. I have almost just copied and pasted his model to wholesale. That is how I learned. This is not something I learned on my own as a baby. I have learned it through mentoring, coaching, and working on the craft here.

Isn’t there a book on this with Keller Williams or the guy that owned Keller Williams? Didn’t he come up with a book about this?

There is a book called The ONE Thing and The Millionaire Real Estate Agent by Gary Keller. Also, Shift. It talks about when markets shift and how to grow your team.

You have a pretty big team and you are doing wholesaling nationwide. How many deals are you guys doing a month on average?

We will close between 9 to 15 a month. I know it is a big scale, but the interesting thing about our model, since we do Google Ads, our average profit per deal is $34,000. When I said I was at $2,500 and I look at this now, this thing has shifted like crazy.

Are you primarily doing deals in the major metros, or are they more outskirt markets?

We start in everything, and then we can quickly learn that we can’t go too outskirt. We have found the sweet spot is the population of 70,000 and up.

I imagine with Google Ads, it is very competitive in most of the major metros.

Yes, but if you open it up to the major metros and you have a wide enough net, you will still get leads for a pretty good price because Google rewards you for trying to go nationwide. Google wants you to pay them the most amount of money possible. If you open up your marketing to a bunch of different markets, in Google’s algorithm, all these people are going to spend a lot of money. I am not a Google expert or anything, but this is my understanding from our business standpoint. We can get good markets if we open it up to the major metros and our cost per lead is still under $150 for submission. Even in Mascali, Miami, and Orlando, our average cost per lead is about $120 to $140.

Another thing it is hard for me to wrap my head around is you are in all these markets and you get a random contract in some random area. What do you do when you get a contract in a place where you do not have anybody there?

I go home and hide.

They are like, “I got a contract. Who is the seller? Who are your boots on the ground? How do you do it?” It is like starting all over in every contract.

In our business, that is still pretty messy. I will share with you the process we have come up with. It is something that people have to be aware of. If you are reading this and you want to go nationwide or something, know that going nationwide is not a different marketing strategy. It is a whole different business because when you go from texting to cold calling, you are doing a different marketing strategy, but if you go from texting to nationwide PPC, you change up your whole business. Your operations, dispositions process, and transaction coordination are different, so you did not just change your marketing. You changed the whole thing of your business. It is something we do for that.

Let’s say we get a deal tomorrow in Kansas City, and we have never done a deal there. We get that under contract. We find somebody on Craigslist to go take pictures for us. We offer them books. We are posting that, then they go take pictures and videos. We have a Google Doc with instructions on how exactly to do it and then we send that to them. Once they get us the pictures and the videos, we now get that, and then we have to find buyers.

It is similar to how you probably teach your audience when it comes to texting and calling to find sellers on PropStream or whatever programs you use. We use that same program to find cash buyers who bought their home cash in six months or less, people who bought two or more deals, and then we send them the text saying, “We saw you bought this house on the tenth street. Do you want to buy another property?” That is how we do it. It takes us an average of ten days to sell a deal.

WI 951 | Virtual Wholesaling

Virtual Wholesaling: If you open it up to the major metros and you have a wide enough net, you’ll still get leads for a pretty good price because Google rewards you for trying to go nationwide.

 

I love that you have that data. I have demonstrated on my YouTube channel before on how to pull a list of buyers on PropStream. Who do you skip trace through?

We use a company called DirectSkip. That is the company we use now.

Do you have a hard time where their business is?

A little bit. We have had to do some digging and we asked for a skip tracer because some skip tracers have that service if you pay a little bit of a premium. I try to find a skip tracer who has that service. DirectSkip does, from my understanding. It definitely is not perfect.

This process is messy for my company and me. That is why I am asking you because we tried to do the same thing where we will pull a buyers list. Do you pull in the zip code, the city where the property is located, or the whole county?

It depends. If it is Vegas, that is a big city. We will pull it. If it is Oklahoma, then we will pull the whole county.

You will send a text to the whole county. What do you say?

We try to change the messages because obviously, when you text, you have to change the messages off or whatever. It is something to the extent of, “We saw that you purchased a property for investment. Are you looking to buy any more properties?”

You may direct them to your website where you have the properties available or just that property or whatever.

Typically, we will try to get 1 or2 more messages out to gauge your interest, and then we get on the phone with them as quickly as possible. If they say yes, then we will say, “We have a deal in this area for $120,000. Would you be interested?” If they say, “Send me details,” then we will call them.

It takes you ten days to sell a deal. Do you get the photos first before you start marketing for a buyer or do you start marketing for a buyer immediately because you know it is going to take ten days?

I know that question comes with pain because it comes with a lot of pain for me. I wish I had an A, B, C answer, but the answer is it depends. There are tenants and owners who are having trouble with the showing, and then we will market it first. If it is easy to show and the seller is nice like, “Come by my house whenever,” then we will wait. Basically, 80% of the time, we get the pictures first. We do our absolute best because we have seen we have left a lot of money on the table not doing that.

If you have a lot of buyers that are interested, how do you handle the showing? Are there multiple showings? Is there just one open house and everybody goes at once? How do you do that?

We tried to get a written offer first. Let’s say we have ten buyers interested. We will say, “Can you send me an offer in writing?” We are only showing the property to people who send us an offer in writing. We are not going to accept that. You are not going to have to send an escrow or anything, but we want to see that you are serious. We want to see something.

We do not do that. I thought about that. I kicked that idea around, marketing it, getting it in writing, and then showing it, but some people do. We do just open-house style where showing is at 3:00. You will be meeting with the property and they will walk you through it. We do that too, but then sometimes people flake. You have a showing, nobody shows up, and, “That is frustrating.” Does that happen to you too?

It happens all the time. We try to sell the site and see the most we can. Obviously, you need good pictures for that, but that happens to us as well. You have to be very fluid and pivot quickly when you have an open house, six buyers are supposed to go, and none of them go. You have to be able to pivot or whoever is on your team has to be able to pivot mentally. Let’s say, “Six buyers. You did not go. What would you offer? If you would have been gone?” “I would need to be $10,000 cheaper.” “Got it.”

What are some tools that you guys use? I want to break it down from department to department. I want to compare my tool chest to yours. Do you use any software or tools to manage your dispo?

To manage dispo, we use InvestorLift.

How does that one work? Remind me.

That one is similar to the PropStream, but you can input a buyer. It could be a buyer disposition CRM.

How our virtual model looks is we do Google ads, nationwide pay-per-click ads, and we still do some text messaging.

Is that the one that has all the buyers like in every area? If you upload your buyer’s list, then you now have access to other people who upload their buyers’ lists? It is like a buyers list collective.

That is right.

Are you happy with it? Are you closing deals off of it?

Every time we get a property, we pull data from InvestorLift or PropStream. We have seen that InvestorLift has more accurate data than PropStream for buyers. In InvestorLift, you could also use it to pull a spreadsheet out of buyers in a specific market, the same as PropStream. That is what we use to organize our buyers. It is still pretty messy. That is something we are working on, but we use Salesforce as our CRM, specifically the left main packaging. We use that and Google Sheets, the combination of those three.

Tell me if you struggle with this. Figuring out what buyers you spoke to about, what property, and tagging who is interested in what property.

It is very tough.

REsimpli has figured this out. I am new to REsimpli and we have not dived into the dispo, but I do think they have something figured out for that. We had this same issue where it is hard, but I love them. For our business, it is amazing, especially on the acquisition side. KPIs are already built-in. We do not have to calculate anything. It is calculated for us. Drip campaigns have all that stuff, which is super cool. InvestorLift is something I had kicked around. I am glad you said that because I was thinking about trying it for a business. I manage my disposition transaction coordination on Monday.com. Have you ever heard of it?

I have heard of it but I have never looked into it. That is interesting.

We found that CRMs do not work for dispositions because dispo is a lot of project management, so you need project management software. Monday is a project management software. For every file, you push this button, then checklist comes down, and you check off who did what and what date it was done to make sure you did everything for each file.

We use Google Sheets the most. We have a checklist type of thing built out on Google Sheets. It does not have a dropdown, but it is similar to what you are saying. That is probably the best I have seen so far that we have been able to figure out.

We were doing a mix of both, but we like Monday. You are CRM. You are not on REsimpli. You are on Salesforce. It sounds like you use PropStream. Is there any other software you use for acquisitions?

We use Zillow a lot to do comps and stuff. We use it more than PropStream the way more.

It is easier.

The bliss of this business is keeping things super simple. I feel like when you start adding too many comping tools or this. If you spend so much time figuring out the right number, go on Zillow and look at the yellow dots. Whatever the number is, depending on sales. Between Zillow or CRM and PropStream, Google Sheets is pretty much all we use in our business.

For our CRM, we do use a fair amount of Google, Google Sheets, and PropStream is something I use. We pull buyer data off that. We do comp off PropStream, but we caught more off of Zillow. The one tool I am interested in is InvestorLift. I am glad I got that from you. I am glad I asked. You have got so much information. I found this all very fascinating. You and I have very different models. I am in three markets and they are markets I have been in for a very long time. They are all I am committed to, so I am not the national model. The national model is a completely different business.

Where we will land is probably picking the top 10 to 12 best markets. We came up with the idea of, “Let’s go nationwide for about 2 to 3 years. Let’s collect the data on where all of our biggest deals come from. What are those markets? Let’s pick the 10 to 12 best. Let’s go for those and eliminate all the others.” We are collecting data doing all these transactions and seeing where the numbers are going to tell us to go. Your model is very smart, and eventually, people will make more money doing some kind of version of your model nationwide, depending on how big or small you want your business to be.

There are plenty of different ways to skin a cat. It depends on what you can tolerate. I do not think there is a right or wrong. They both can work well. It is cool to compare notes because you will learn some things from me being more localized, like what you are missing out on being very localized, where I am going to learn how to dispo properties better in my local markets because you have to try hard to move a property. You have to build out the buyers’ list. That is pretty hard. We can learn a lot from each other. We need to be friends and make sure we talk periodically. I need to have you back on the show. Tell us how people can get ahold of you. Do you want to share like your social media, Instagram handle, and all that?

My name is @RaulBolufe on YouTube and Instagram. Those are probably the major channels. You could DM me on Instagram and I will respond there. You can email me directly at Info@RaulBolufe.com. I look at my emails every day. Those are probably the two fastest ways if you want to reach out and follow me.

It was great to have you on the show. Thank you so much for being so candid and sharing all this information with us. Guys, if you are reading this, hopefully, you got a lot. Make sure you share it with someone who you think might help. If you want to go virtual like Raul and me, make sure you check out www.VirtualInvestingMastery.com. Thank you so much for reading, and I will see you next time.

 

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