David: Alright guys, welcome back to that Discount Property Investor podcast. This is your host David Dodge. I am here today with Tom Kroll, welcome Tom! How are you? I love it. I wanted to get Tom on the show. I have been following Tom for a really long time. He has been doing some amazing things out in the wholesale sphere in the real estate investor space. He is the guy behind WholesalingInc. So Tom welcome to the show, man.

Tom: David thank you for having me, I am honored to be here, and thank you very much for having me on, my pleasure, very cool.

David: Absolutely, Tom, it's actually my pleasure. I have been following Tom for quite some time and I heave learned a lot about wholesaling, and real estate investing from Tom and a lot of other people that-- are part of Tom's tribe, WholesalingInc tribe. You guys know, we just published our book, 'The Ultimate guide to--'.

Tom: There you are.

David: Yes yes, so Tom, tell us a little bit about WholesalingInc for those that know nothing about it, which is probably pretty rare, but if you don't know anything about WholesalingInc, tell us a little bit about it.

Tom: WholesalingInc is my baby. I will tell you this, I really believe WholesalingInc is my purpose in life, right? One thing I've learned from my mentors Robert [00:02:19.11 - inaudible] is passion is what you want to do, purpose is what God wants you to do. As soon as I started wholesaling and I started sharing the message about how easy it is, and it can really change your life. A guy like me who got a 9.90 on his SAT's, didn't finish college, was a long haired guy, got fired, went through a bankruptcy. My mentor pulled me through kicking and screaming and taught me how to do it. That's how we do it. At WholesalingInc it is all Mr [00:02:49.19 - inaudible], we don't care about what you think you know about wholesaling, we don't care about what you want to know about wholesaling. When we tell people, hey this is instruction, not education. We are anti-education, we are all instruction. It's my purpose in life to help people do deals, I love it. We have more reviews than anybody, and I live for the review every single day. We wake up, what can we do to get Johnny, Bobby and Sally, their first or next deal in wholesaling, and that's all we do. We cut through all the fat, that's what it's all about.

David: I love it, and I was just on your website the other day and I noticed you guys have a ton of reviews which is awesome. Damn is right. You have a ton of them on there, and it looks like you guys have helped just countless people-- get into wholesaling, learn it like you said, instruct them on it. You know hopefully get their first deal so that's awesome, Tom, I love it. You guys also have a podcast, is it the WholesalingInc podcast?

Tom: WholesalingInc podcast, and it is all the same message which is-- everyone over complicates this business, they make it about real estate. Wholesaling has nothing to do with real estate, nothing. It's really more like a pawn shop. It's super simple, if cars tomorrow became more valuable, more desirable and profitable than houses, we would just switch our motto go cars, we don't really care, watches or whatever. But I think wholesaling is really easy, people are really complicated. Or wholesaling is easy, wholesales are complicated. I think if you just keep it simple, you just stay focused on one thing, don't have multiple acquisition strategies, don't have multiple exit strategies, just-- it's a numbers game. Keep it simple, the key is-- the reason we do this is we all want a business that is a servant to us and our family. Most people-- even if they can create a little bit of money wholesaling, they create a job that they serve. So we are all about-- let's just have a business that is consistent and simple. Simple consistent process that you can delegate to someone else, and go rent the little hut on the Pacific ocean, go fishing, I don't know.

David: That's right. I was just talking to Brent yesterday, and he was saying-- so many good things about your program, I forgot what was coming to my mind about it. But anyway, I wanted to say I stole from you your quote 'progress over perfection'. I heard you say it first, and I love it. So here is what I was just telling Brent the other day. So we just published our book, 'The Ultimate Guide to Wholesaling and Real Estate'. My partner and I, Mike Slane, we worked on this book for about two years, okay? We wrote it, and we re-arranged it, we re-wrote it, we re-arranged it, we re-wrote it, and we re-arranged it, okay?

Tom: Right.

David: We sent it off to the printing press, and it went through a spell check in the process and it fixed some of the errors for us, okay?

Tom: I think I know what you're about to say.

David: Oh yeah. We printed 200 copies of it. I was going to start mailing these out to anybody and everybody that had something to do with my success. Like it or not, know it or not. You are one of those guys who never even know who I was. I knew you and I followed you and I learned things from you along the way. So I wanted to say thank you to you as well as other people I sent the book to. But on the very first page there was a spelling error, then if you kind of flip through the book on the right side of every page almost on the top, not very single page but a lot of them there is that same error. We printed 200 copies of the book. When somebody in my office said, hey Dave you know that you screwed this up? I started laughing. The first thing that came to mind was progress over perfection.

Tom: Yes!

David: Progress over perfection. I am going to say it again--.

Tom: Bam!

David: Tom, that is one of the things I learned from you buddy.

Tom: Here you are, I'm ringing the victory bell.

David: There it is.

Tom: There you go, that's the victory bell. Progress over perfection. I agree, man. That's the secret, let me tell you, this is not a mistake. This-- there are no mistakes, right?

David: I'm not upset about it or embarrassed about it. i don't care, it's fine.

Tom: Well the whole thing is, it's your state of mind. Wholesaling has nothing to do with real estate, it's a state of mind. I would embrace it, absolutely. That's the secret to success right there.

David: It is, as you can see I put the little E in there and signed it for you. It's corrected now, so if you buy the book you won't see that. If you get one or had one or I mailed you one, it's a special edition.

Tom: I love it. I will keep it forever.

David: It's a special edition. But the message here folks, the message to our listeners and viewers is-- progress over perfection. If I were to have waited till this book was absolutely perfect, absolutely the way I wanted, it would never be done. It really truly wouldn't. I would always find a place to throw a comma, or this paragraph doesn't work, or this needs to go there. It doesn't work and it is very similar to what I teach my students, and what you teach your students, Tom, over at wholesaling, about progress over perfection. It doesn't necessarily have to be perfect, just work on doing something, right?

Tom: At the end of the day the perfection is really just fear, right? People say there is no such thing as a fear of success, absolutely not true. The one commonality, or common thread that I see with anybody I spend time with, that is the one percent of the one percent financially, and I am not blessed to be able to say, I have a lot of friends in that category, all of them do two things that the 99% of the masses do not do. The number one first thing they do is they all read, every single one of them read without exception. There is not one that doesn't physically open up a book and actually read it.

David: Sure.

Tom: The second thing is they all have courage, all of them. Progress not perfection is really an idea I learned from one of my early mentors Jeff Walker. This idea of progress not perfection, it's really because you care what other people think of you. You don't want to look like an idiot. If you care that much, the best people don't care what other people think about them. If you care that much--.

David: So true.

Tom: You are never going to be an entrepreneur, bam!

David: Bam!

Tom: It's so true, man! That's why if you know these simple rules of life, like hey, every single day, wake up, read a bit of a book. I want to be a millionaire, I want to be a millionaire, I want to be a millionaire. You have a 65 inch television--.

David: Right.

Tom: You want to be a millionaire but not really.

David: Do you want it? How bad do you really want it? I love it.

Tom: Awesome, man.

David: Let's talk a little bit about-- so-- whenever you do your live videos on Facebook, sometimes if I'm available I will watch them, or I will watch the replays of them. You talk a lot about having a-- I am going to screw this up, I'm going to butcher it--.

Tom: No go ahead.

David: Help me please. But you talk a lot about having a cap, or even--.

Tom: A financial cap on your financial aspirations.

David: There you go, that's what I'm looking for. You have a financial cap on your financial aspirations. However, I want to ask a couple of questions about this real quick, however-- I feel like you are saying that towards whenever you are like automating it. Am I on the right path here? Whenever-- your systems are in place, running smooth. Because obviously if you wanted to grow something you could, right?

Tom: The key word there is 'you'.

David: Okay.

Tom: You are exactly right. So first of all let me say this, this piece of advise is not the person who has not done their first deal.

David: Of course.

Tom: You absolutely hit the nail on the head. Dialed in what this is really saying is hey look, you are already making let's say 50k per month, okay? So you are putting 50 thousand in your month-- every single month persistently. What happens is, when you go to delegate, I like the word delegate better than automate, because I think-- we have no business automating, let the people you delegate to automate.

David: Sure.

Tom: But as far as the process, I don't care if it is manual or automated as long as it's delegated to somebody else. But the problem is, you see these people, you could always tell because it is the one who have the most expensive conference tables. Those are the people-- they have been on this gravy train since 2008, and they are like, I am so smart, and I am so great, and my business is so great. As soon as the economy starts to do this, people with the most expensive conference tables, they are the first ones out of-- bankruptcy. I think that the key is-- that if you are making $70,000 net per month let's just say, right? The problem with-- people have this advice that if you are not growing you're dying. That is true, but growing doesn't always have to be your gross number. I think what happens is when you are always growing, or another word for growing is changing your processes, right? Because that's what it really is, it's very hard to delegate something that is always changing. It is very hard for your business to run without you when it is always changing. So this whole idea of putting a cap on your financial aspirations is really just step one of saying, hey listen I have a family, I have children, thank God we're blessed. If I'm making $75,000 a month net every single month. If you are still not happy and satisfied with that, there is a core nugget problem--.

David: There is.

Tom: I don't care how many zeros you put in front of that, you are never going to be happy. I've seen some of these guys that are like constantly like a roller coaster. Grow, grow, grow, grow! It's not-- I'm after this for the lifestyle, I want a business that is a servant to me, and I think one of the keys is when you get to that stage, not today, when people are listening, if you haven't done your first deal, again this is not advice to even consider.

David: Sure, sure.

Tom: But I think number one is Gary Keller, to have a business that runs without you. Number one, have one thing you do really well and ignore everything else. Don;t worry about the-- a lot of people get caught up in selling the product of their business. Number two, put a cap on your financial aspirations. Then number three is delegate don't automate. This way you have a business, and if you want to grow, you know what? Have a goal of how can I cut my expenses by 4% in the next 90 days? That's a great goal. You are still growing but you don't have to be constantly growing-- you have to find a way to-- I don't know, spend time with the family. I think this is coming from a place, not something I learned coming up, but now I am a different place, something I think is important and it's-- the people that are where I want to be-- they are very happy at making X amount per month. They don't have a need to always want to grow that number. I think-- it's like I said again, you have to be careful where you place this advice, because if you are brand new, kill it!

David: Tom I get it completely and I appreciate you explaining that, because I think I understand, or I understood what you were saying. But I just wanted you to elaborate on that a little bit, because I totally agree with what you're saying. I totally agree, changing is growing, and you don't necessarily have to grow to an infinite number obviously. But just being content and complacent and happy with earning a good amount of money which in our eyes is a ton. $40, 50, 70,000 a month. That is what most people are making a year, you can pull that in, in a month, and we sometimes have a good month where we will bring in $60, 70,000 as well. I totally get it and I love it.

Tom: I think the key is to start with your net number, that's really the key. One thing with growth is, the thing that hurts a lot of people in growth mode, is when they are growing their expenses are coming up. But the problem that you find when people get into trouble-- because my mentors are people who have been around for 30 years, right?

David: Sure.

Tom: The people who get in trouble-- is what you find is right now it is okay for your expenses to go up and have the complexity of your business be a big web. But when the gravy train starts to flow, the income dips but the expenses don't.

David: Keeping those expenses in check is super super important.

Tom: Oh yeah.

David: That can go for the newbie all the way up to the guy who has been doing it for 10-15 years, you know? Keeping your expenses in check. We actually just did a traction meeting, me and my two partners yesterday. We were talking about this exact same topic. Let's see what we can do to reduce our expenses, even if it's just like you said, 4 or 5% let's say. Absolutely.

Tom: Put all your energy and focus and time and money and resources into one thing like the 4% reduction in a 90 day goal. Obviously you guys probably hit 8%, but yeah. I've got [00:16:19.00 - inaudible] book right behind me on that shelf.

David: I love it, man. Well Tom, tell us a little bit about your wholesaling business. I know you are a major player in the coaching space, and you are doing great things for people. So that is awesome, but tell us a little bit about your actual real estate business. What market or markets are you focused in? Tell us a little bit about what your team looks like if you don't mind.

Tom: Absolutely. Well I am an open book. First of all I just want to say I love wholesaling.

David: I do too, I love it.

Tom: I love it, I believe it is-- I sincerely believe it is the greatest business that ever-- it's better than even winning the lottery, because if you win the lottery you didn't earn that money and [00:17:04.14]. I do not know another business that is better than wholesaling. I get to speak with a lot of people who do all kinds of fancy stuff with real estate and outside of it. So I really sincerely love it. I think anyone can do it with grit and determination and hard work. I also think every single person who coaches, and this is where it's a little bit-- not everybody agrees with me, but I believe in order to be a coach you have to-- the only things you should coach are things you are already-- at that destination. If I am [00:17:37.18 - inaudible] Florida, I can teach you how to get here because I am here. But if I was telling you to get to San Diego, I am not from there, I don't know San Diego. I have been there once or twice. So I think that the key is, I keep my coaching business, my wholesaling business, because I love it, because every single person should have a wholesaling business. Essentially a wholesaling business should do three things. It should run 100% without you, it should produce at least a million dollars a year or over, and it should also provide a constant pipeline of deals that you can consistently cherry pick for landlord deals. So right after this podcast, my wife and I are going to go look at a house, we are going to pick it up for 150,000, it's a beautiful 3 2 CBS, which means concrete block pool home. We are going to buy it and we are just going to rent it for a year, then sell it through owner financing, we don't pay long term capital gains.

The only reason I can do that is because of WholesaleInc. My team is very simple. I have got 1 and a half people.

David: That's awesome, talk about simple, man, I love it.

Tom: Keep it simple and keep it stupid. I am not a complex guy. One thing and I want it done consistently without me. Last year we shot for a million, we did 1.1, just over 1.1 million in assignments. The business is totally automated. I have a mail sequence that is done by Lorena, it's done through direct mail. Lorena has been with me since day one, she is my first employee. She is in the Philippines, I actually flew her out here recently, she is awesome, her and her daughter. We had a great time at one of our summits. She has a mail sequence that we go through. So if you want to discuss lists that are working right now I am happy to do that with you, but we have I think right now an 11 week mail cycle. Every single week we have a list that goes out with a postcard, then we check all the KPI's on that, all the key performance indicators. Daniel is my brother, he is the acquisition manager, he gets paid 20% of every single assignment. He goes out in Florida, my title company is sort of my disposition manager if you will. So they handle the disposition of getting rid of those contracts or those houses if we buy them.

David: The title company does that? I have never heard that before.

Tom: If you have a really good title company, and you are in a particular State you can do that. In other States, take for instance New Jersey, northern New Jersey, some of our most successful students are in New Jersey. We call it little San Diego. You got have to disposition manager when you're growing. You can't do it through your title company. There are some other States like that as well.

But yeah that is basically the whole team. This year we did hire an assistant for Daniel, Chantelle, she is working part time. We have basically two people, Daniel and then two part time people. Lorena works more on the coaching side now. The business is totally phenomenal, even without the coaching. I will say that I have a few channels we work on. But one of the key differences between people who are successful and people who are not successful, is if you ask someone who is a new wholesaler who is struggling, and you say, tell me what you are doing to find deals? You always get the same answer 100% of the time. They will say, well I made some cold calls, I spoke to some agents, I called Craigslist and I sent out some mail and put up a bandit sign. But when you spoke to someone who is like, hey I'm crushing it, and every month I am bringing in $100,000, it's always the same answer. What do you do to find motivated sellers? Well I do this one thing and I totally dominate it, I totally dominate cold calling, or direct mail, or bandit signs, I put out 2000 a week and I know exactly which one is where, and where it goes. So I think the key for us is we have totally dominated on channel. Some people like direct mail, some people don't. I love it because you can reverse engineer it.

David: Right.

Tom: The key is-- the secret to my success is that you have to-- Gary Keller, Mike [00:21:36.18 - inaudible], Scott Alexander, all these authors of all these great men and women that came before us, you don't have to learn the hard way. All of these great men and women who have come before you and have written books, they tell us; do one thing, and do it really well, your life will be easy and you will make more money then you will ever spend in a life time. But new people that don't know this, they start out and they [00:21:57.14 - inaudible] their efforts by going into multiple channels and doing 10% here, and 10%. So they never dominate it. Bam!

David: Bam! That is some of the best advice that I have heard on the show, Tom, I love it. Seriously! I love it, because in my business I am going to take over for a second, in my business we do direct mail, we do-- we do direct mail, we do ad words, we have a guy that does bandit signs, I personally don't do it, but I have delegated that as you said. We also we just recently launched on the radio. So we have some radio ads that are playing, on two stations multiple times a day on each station. Everyone of these things brings in leads okay? However you are absolutely right, there is one of those things that brings in the most leads for us. If you are new to the business, don't try and do all the things. We can do all the things because we have a big team built out, a team of 8 or 9 people here at my company. So everybody has time to do and help out with these little things. If you are new to this business, that is the best piece if advice that I have heard all month. Find one thing you can dominate at, and jump in with both feet and do nothing but that.

Tom: Right.

David: Boom, Bam! That's all there is to it.

Tom: They see all these shiny objects, and it's like, I'm going to do a Facebook ad, please don't do a Facebook ad. The real problem is that it hurts the people who are most vulnerable. The new people are the ones who have the most limited resources. Again, the advice is-- it's not do one thing forever, it's do one thing automated, delegate it.

David: I left that part out but you are absolutely right. Do one thing, get good at it, and then delagate it.

Tom: Yes.

David: Delegation is a form of automation.

Tom: For sure.

David: Delegate it to someone else, let them run with it, then when-- not until though, but when you got that running smoothly and you're happy if you decide to do something else, that's when you can do it. Man I love it.

Tom: Absolutely.

David: It's so true.

Tom: The rules of life and business are simple, people are complicated.

David: I love it, people are complicated. They really are. Tell us a little bit before we wrap up about this house you are going to go look at. I'm curious, tell us how you guys found the lead, how the conversation went, what was their motivation? I imagine it was direct mail, but maybe not. You already mentioned what your plan was but let's elaborate if you don't mind please.

Tom: I have so much good stuff for you on this. So first of all, what Julie and I tried to do, the long term goal of most wholesalers is-- not only do you have this million dollar business and it runs without you, but it provides this pipeline that you can cherry pick from for your long term passive income. What we are looking for in Florida is a little bit more specific, there is frame houses, which means they are made out of wood, or they are CBS which means they are made out fo concrete. In Florida that is very important.

David: CBS like the store?

Tom: CBS, concrete block [00:25:15.26 - inaudible].

David: Okay that makes sense. I'm in St Louis, we don't have any concrete. We have a concrete block but it's just like the foundation in the ground, not above it.

Tom: This is the whole wall, all the way to the roof. The thing in Florida is we have termites, we have bugs, we have moisture, so the earth just wants to--.

David: The moisture I would imagine is a huge problem down there.

Tom: That's why I have my AC right behind me.

David: That's great.

Tom: My body type doesn't do well with--.

David: Mine either man.

Tom: This particular one came from direct mail. Right now some of the hottest-- if you guys want to just crush it and make this podcast to take massive imperfect action and get a result from this podcast, number one is people who have their water turned off, that's a hard list to get from the township [00:26:02.16 - inaudible] county or city. Find those people who have had their water turned off and just go and see those people or contact them. The other one is unknown equity, unknown [00:26:12.14 - inaudible] from listing companies.

David: We have been using that recently, the unknown equity and the unknown sale date. We have had great success with those lists.

Tom: Phenomenal. Number one is 24 hour arrest record list is phenomenal.

David: I didn't think about that one.

Tom: People who have been arrested recently, pull that everyday, find their address. If it's an absentee [00:26:31.02 - inaudible] owner.

David: I love it.

Tom: The other one-- this one came from was-- I had it right here I can tell ya. This one came from a different list. This one-- I should know this I guess. This one came from-- I don't know, I don't have the address.

David: No problem, but it was a direct mail?

Tom: It came from direct mail, and I want to tell you something, I was just on the phone with Alex, and he reminded me of this-- one of the things that is so key, is if you guys are speaking with sellers, there are two things which are going to explode your business right now that I can give you. Every single person who is listening, this will explode your business right now, here are the two things; number one most important rule of life in wholesaling business is when they call you from direct mail, assume motivating. Stop waiting for the seller to convince you they are motivated. If they are calling you they are motivated.

David: I agree 100%.

Tom: Big secret, always assume motivation. What that means is, if I can't-- every single person that calls in gets an offer. It doesn't matter, we tell them-- a phone call can only one of five ways, right? One of them is if they-- if we are not going to go see them because they are acting not motivated and they want a million dollars for a $30,000 house, send them a written offer anyway. Write this above your desk, everyone gets-- this is for your listeners.

David: We do. We do it in our business, but anybody listening, all our listeners, all our viewers, this is awesome advice. No matter what, send an offer and do it in writing. If you want to make a verbal offer on the phone that's fine, do that. But send it in writing even if it's via e-mail, sometimes direct mail [00:28:20.22 - inaudible] back to them. Send it, because motivation changes. You don't know when it's going to to change, right?

Tom: A lot of times when you're on the phone with them they are like very closed in, so you can't tell especially if you're new, and make the offer time sensitive, 7-10 days. Written does work a little bit better, but if you could send it in the mail, we have had-- my brother taught me this I was like, no way that's a waste of money, it's never going to work. Number one is assume motivation and send offers. Number two is, if you are having trouble-- remember we are a pawn shop, this has nothing to do with real estate. The exchange of services that we are doing is, I give you speed and convenience to the seller, and the seller gives me a low price. That's what they are doing. If you have that mindset, right? Then you can be more confident, you can understand the actual value bringing speed and convenience, and they bring a low price. The problem is, sometimes new wholesalers have trouble getting to the 'why'. Why is this seller selling at a massive discount? Here is a little secret--.

David: Tom, I listened to this the other day with you, and you were talking about this. Go ahead, I have to say, before you even say it though, bam! This is huge!

Tom: Bam! This is so big.

David: This is big.

Tom: When you are with the seller, if you keep asking why they are selling and they are like closed in and don't want to tell you, ask them when they want to sell. The when reveals the why.

David: I'm going to say this again, the when reveals the why.

Tom: So big.

David: Like when you said that, I was thinking, shoot I always do that, but I didn't realize I was doing it. I always start with the why, everybody does, that's what you're taught. Figure out why they are selling. What is their motivation? But if they are embarrassed to tell you, or just thy are guarded, ask them when, and that will start to unpeal as you said in your Facebook video the other day, it will start unpealing those layers of that onion. Get to the why by asking when. Tom, Boom! Two big pieces of advises in this podcast, I love it.

Tom: I have to give credit, I was on the phone with Alex Young blood, and he was the one that reminded me. I had the same epiphany, I was like, oh man I always do that.

David: I always do, but I never thought why it was so powerful. I always get to the why. I guess i didn't realize how I was getting to the why. I always say, why are you selling? If they don't tell me I go, okay no problem, when do you need to close? Then they say, I need to close next week because-- then the why. Well-- I always get to the why, but I didn't realize how. So ask when when you can't determine the why, and it will help you determine the why indirectly. Bam! I love it.

Well Tom let's wrap it up, man, let's end on a good note. I want to thank you so much for coming on the show. Like I said, you were one of the people that had helped me, inspires me, you didn't even know it but I wanted to say thank you so much for all the things you've done and continue to do. We wrote this book, if you haven't bought the book yet, check it out, it's on Amazon for sale 'The Ultimate Guide to Wholesaling Real Estate'. It comes with a free online course. If you guys haven't checked out the course, it's FreeWholesaleCourse.Com. Can't get a better domain than that. FreeWholesaleCourse.com. A great place to get started.

Tom, thank you so much again for coming on the show. Any last words for the guests and viewers?

Tom: Just go out there and make it happen guys, don't over complicate the simple business, stop learning, start earning. The number one reason new wholesalers fail is because of education. The guys and girls who get the most results are the ones that make the most money. You can turn this podcast off right now and go get a house under contract. If you are too high you cancel the contract, if you are too low you will just make too much money. Stop learning start earning.

David: Stop learning start earning. Alright. Until next time guys check us out online, DiscountPropertyInvestorPodcast.com. If you are new to real estate, check us out on our free course, FreeWholesaleCourse.com. Until next time, signing off