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Today we speak with one of our All Star Team Members Dan Koch! Dan had been working with Ray back in the day and his business evolved but didn’t go the direction he wanted. He came back to us and has been rocking out deals for the past several months. In that short time he as already started to build his own team!
David: Hey Dan.
Dan: Hey, what’s up guys?
Mike: Welcome to the show.
Dan: Thanks for having me.
David: Thanks for coming on.
Mike: If you guys haven’t listened to the show before; we encourage everyone to go back and listen to the first ten episodes, and to check out the freewholesalecourse.com. So if you have never done any real estate investing before; we encourage everyone to start with wholesaling, you are going to learn a ton about investing that way. We put a free course together for everyone at freewholesalecourse.com. So get the… get that out the way and now we can start talking to Dan.
David: That’s right.
Mike: Dan thanks so much, man.
Dan: Yep, happy Halloween.
Mike: Yeah it’s Halloween.
David: So Dan, tell us a little bit about how you got involved in real estate investing. I know you were working with our partner Ray a while back, then I believe you kind of stopped doing it and started contracting a painting company. Now you are back in full force wholesaling and investing in real estate.
Dan: Yeah I think when I started with Ray which was back in 2008… I was pretty fresh out of college. I didn’t really take the business seriously. It was just kind of run and gun, don’t track numbers, don’t track your successes. You are always thinking that next check will be there.
Dan: You have to treat it like a business and obviously I was young then and… didn’t really treat it like I should have treated it. I went out after Ray and started rehabbing. Also worked a corporate job at the same time.
David: What was that?
Dan: I worked for Bowing for three years, two and a half years, something like that, negotiating contracts.
David: Cool, I didn’t know that about you.
Dan: The corporate world is not everybody; it is not for me definitely.
David: Not for me either.
Mike: It’s the worst.
Dan: I feel like I am a horrible employee, I tell people that right now. I am a horrible corporate employee.
David: That’s okay.
Dan: Yeah it was one of those things you have to try out. You spent the money on a college degree; let’s try and use it for a little bit.
Mike: Dude, that is exactly what I did. I paid for it; I have to get that money back.
David: I tell people all the time; if I could do it over again, I would take the money I spent on college and invest it in real estate.
Mike: I would have taken that money and just partied and not actually gone to school.
David: I learned a lot and had a lot of fun. Anyway back to you; are you doing rehabs now?
Dan: I don’t have any rehabs going right now. The last major rehab I did was in 2016.
David: Okay, so last year.
Dan: Early part of last year is when it finished up. Just trying to get out of managing a whole bunch of people right now. I got kind of… I was rehabbing my own houses, then people were asking me to do work for them, do some where here, do some work there. I kind of got away from what I am good at. I am not good at managing a ton of grown men that don’t want to work.
Mike: So Dan was doing… his own flips, then it sounds like you branched out and started running a contracting business essentially.
Dan: Right. Just because the money was there, the need was there, the want was there. The only desire that wasn’t there is by the people I was trying to employ; they didn’t want to work. Everybody wants to work until they get a job.
David: That’s right. They all show up to the interview process, but once they are supposed to come on site to fix that sink, drain or wall or whatever… it’s a pain in the ass.
Dan: So it’s good to be back doing what we all love to do.
David: Right, which is wholesaling.
David: So Dan has been working with us for… how long, Mike? It’s been a while now. Probably close to a year; 7 or 8 months.
Dan: Since May or June or something like that.
David: Good deal. And… Dan has had a ton of success; you have already done several deals, and I love the fact you have already started to take on people underneath you essentially. So you have… I don’t want to call it assistants but you have people that you have partnered with. Let’s call it JV partners that have taken on a lot of your work in terms of acquiring, and going out and finding those motivated sellers. Let’s talk about that quickly. Who are these people? How did you recruit them and what exactly are they doing to help you get that next deal?
Dan: The main guy that I have right now is a kid… he is pretty much fresh out of college, but been out of college a couple of years. Really motivated to get in the business. He was actually a lead from LinkedIn.
David: No shit, that’s cool.
Dan: Just somebody who wanted to learn the business…
David: When you say the business; real estate investing?
Dan: Real estate investing.
David: Not wholesaling? Just real estate…
Dan: Well wholesaling, real estate investing, the whole thing. He wanted to know, how do I get into this? How do I get started? Where do I go from here? I was that same person.
David: We all were.
Dan: Back in 2008, I didn’t know who to listen to, didn’t know whose content was worth anything. Didn’t know who I should spend money with. This kid; he is in the same position so… I just felt like I would give him the same chance Ray gave me.
Dan: He is basically doing the same things I did for Ray almost ten years ago.
David: Sure. That’s the best way to start, it really is. Just work with someone who knows what they are doing; versus trying to find all the information online. We just did a podcast earlier that… we talked just about that exact same thing. All the information is out there on the web.
Dan: It’s just filtering through.
David: Not only that, but putting it together. It is like… do you want to learn how to do this business in a few months? Or even a few weeks? Or do you want to learn how to do this business over a couple of years? By hiring somebody, working with somebody like you are doing, and he is doing with you I should say. Speeds that whole process up.
Dan: We are all doing that to some point, right? In our business, in our lives.
Dan: It is just too tough to do everything by yourself and be efficient at it.
David: Absolutely. Not only that but it’s too stressful; who wants to work 16 hour days? Not me.
Mike: Plus you waste your time on a lot of stuff. That is the main reason… I would just say it’s better to hire someone or work with someone. You skip over all the B.S and you focus your efforts on the things that are going to make you money.
David: Right absolutely. But you got more than just that one guy; you go a couple of people working with ya, for ya at this point, don’t you?
Dan: I have another girl who is making phone calls. She ran a call center here locally for a while. Because of some family health reasons she can’t work in the call center anymore.
David: Works from home?
Dan: Yeah. We are training her up, trying to get her more comfortable on the phone with real estate type of calls.
David: Right, that’s awesome, very cool. Well I love the fact that… you kind of taken a kind of untraditional approach to finding the leads. Most people do not have… they do not have it in them just to pick up the phone and call a seller. What they do is… they will spend money on a bunch of mail, or spend money on bandit signs or… spend money on online advertising, trying to get those people to reach out to them. But you are just… peddle to the metal type of guy to where you are like… screw that; we are going to get lists of people can call them straight up and make offers on their homes, so on and so forth.
Dan: Right and… we are just cutting out time, one thing, right? The expensive mailing; it does cost money to retrieve phone numbers but… if we mail somebody 8 times and never get a response… that is costing money, right?
David: Right, and time.
Dan: And time, we can just call them directly. Then at the end of the day it’s like… those difficult things that nobody wants to do; that is where the gold is.
David: And it puts you way ahead of the pack.
Mike: That’s what I was just about to say. You are talking about how people are willing to send out mail and they are willing to do ad words, but they never answer their phone, or call them back.
David: That’s terrible.
Mike: It’s just such a waste of…
David: Ad words in some areas could be five a click. It could be… I know in some areas where certain key words… it could be hundreds of dollars a click.
Dan: Especially in our business ad works are pretty high per click.
David: We are spending about twenty bucks a click for a while.
Mike: We might want to keep that between us here. We are paying way too much.
David: We don’t do that anymore though because it wasn’t worth it. The fact you can… I mean purchase the numbers is an expense of course. But just calling those individuals up, getting their information…
Mike: It does, but it doesn’t have to. There are certain ways… you can go online and look up people’s numbers now.
David: That’s true.
Mike: If you take the time…
Mike: You can go out there and find these numbers.
Mike: It’s just a different expense because it is an expense of time at that point. So yeah… it is getting on the phone, it’s awesome.
Dan: Then when you start doing it, you start knowing… how many people you have to call to reach somebody, and how many people you need to reach to get an appointment, how many appointments you got to set to get a contract, and how many contracts it takes to actually close one, flip one, fund it. Then you are tracking your business; you can set yourself up for the next year, share your goals with your team if you have motivated people. They are going to see those and they are going to know; hey the more money I’m making, the more money he’s making, we are all making money. House Sold Easy property investors making money. It is just a win, win, win.
Mike: That’s what I love… I love when Dan came in… do you mind sharing your goal for the year with everybody?
Dan: Hell yeah, 2018 I want to do 100 houses. I want to buy and sell 100 hours in 2018.
David: That’s awesome.
Mike: So we had a little meeting, our sales meeting and Dan is like… that’s my goal, I want to do 100 houses. He kept getting feed back; what about this? What about this?
David: I don’t care; that’s the goal, that was great.
Dan: You know what? We are going to hit it, we are going to try. We are going to do everything we can to hit it. If we come up short but we are still way up there… then we are going to do 120 the next year. We will just keep raising it, raising it, raising it.
David: I love it.
Mike: Well if you don’t hit your goal, Dan… and you flip 80 houses next year; how disappointed are you going to be? If you flipped 80 houses. It is one of those things where you are shooting for 100… you are just setting yourself up for success which is awesome.
David: I love the fact that you talked about reverse engineering the numbers. The first real estate coach I ever hired… that was like the first thing we did. We essentially said… how much money… he started with how much money are you looking to make in the next couple of months? I gave him that figure. He said, okay how much money are you estimating to make off a deal? We determined that number. Then we reverse engineered it to then know how many deals I needed to do. Then he said, okay well what it is going to take to do a deal? Are you going to have to make a hundred phone calls? Are you going to have to send out 300 pieces of mail? So on and so forth, so we reversed engineered it all the way down to a daily list of to-do’s. At that point it was like… send out 60 pieces of mail, contact 20 people on Craigslist… make 16 offers, I can’t remember the exact amount. But we reverse engineered it down, and I followed that structure for three months. After those three months we circled back. He said, what was your initial goal? How much money were you trying to make? Then we looked at that stat and I was like, holy cow! I am right on point. But it is because reverse engineered it. So knowing your numbers. Maybe that is what we will title this podcast. Knowing your numbers is super important in this business especially… especially due to the fact we are in the marketing business. Real estate is our product we have said it a million times; but at the end of the day… no matter what business you’re in, you are in the marketing business. If you don’t know your numbers… you are not going to be able to turn that goal into a plan, that can then become an achievable success.
Dan: Right, and if you are scaling it correctly like you should… you should have to bring somebody on to help you out with stuff because… you are making all these new phone calls every single day… well eventually some of those “No’s” are going to be yes’s from those. There is going to be follow up, there is going to be people that call you back that you left messages for. So eventually you are going to be to the point where you are not making any of those cold phone calls. You need somebody to make those for you; because you are busy following up with everything else that is going on.
Dan: And so that is the way it works for everybody. Then it’s a win, win. You teach somebody new that is coming into the business, the hardest part of the business… which is really those scary phone calls.
David: I got a guy that is doing that for me right now. He just found us another rental, so we are going to pay him a nice little check. Same scenario; he’s like, what’s the worst thing that can happen? He said that to me and I am like, they are going to hang up on you, going to tell you no. He was only making a couple of calls a day and then… after he got that first deal for us… I said it is not so scary anymore getting paid, is it? He is like, no you can tell me no a million times now. Since that day his number of daily calls has gone from… maybe 10-15 a day to maybe 60.
Dan: Right, right.
David: He’s like, tell me no! Just that much closer to my next yes.
Dan: Probably too deep for this short time here but… there is that… pleasure in pain. Is the pain of making a phone call greater than the pleasure of receiving a check? How do you… and if you can get into your mind… and train yourself to realise the pleasure is way greater than the pain… of them saying no or hanging up.
David: Oh well. I usually call them back if they hang up on me.
Mike: Sorry we got disconnected, I do it every time.
David: Me too.
Dan: I don’t know what the check looks like… would you get hung up on 20 times to make $5,000? Or $10,000? If you knew you have to make 100 phone calls, and you were going to make a check for $10,000 but you were going to get hung up on 99 times, would you do it?
Dan: Yeah, so that is the way people have to look at it, they track their numbers…
David: I don’t understand why that is so hard for most people to get that through their thick skull.
Mike: Because a lot of people our age like to text now. So calling is even harder…
David: I guess so, man. Again, I have done several coaching programs. My goal with each of the programs was not to make the most money, but just to be the number one person in the program. I have done three of them, but two of them were short like 8-10 week programs. Full times I was number one. At the end of the time it was all based on score cards which are what I give our students. My score card as far as number of calls made and all these things was 3-5 times everybody else. How hard is it to make that phone call? It’s not, but I guess people just have that fear of… picking up the phone…
Dan: You know what? The person on the other end of the line is probably caught off guard; they don’t even know who you are to begin with…
Dan: You are explaining that, and if they get upset with you; who cares? You don’t even know them, probably never see them again.
Mike: You never saw them to begin with, you never see them ever.
David: That’s right. Well Dan thanks for coming on, man. This was a short little episode; we just wanted to bring you in. Knowing your numbers, super important guys. Picking up the phone, making those calls. That is where the money is at in this business. Dan said it really, really well; following up is just as important if not more important… than making those initial phone calls. So once you get to the point… if you are a new investor and you are listening to this particular episode; when you get to the point where… you have a nice little data base built up of people that you have called, that the motivation may not be there today… it will be there at some point down the road. So follow up with those individuals and… you need to hire an assistant, or even bring on a friend of a family member and… we have a student right now who just brought his mother on to help him make calls. Sometimes you got to do what it takes, got to have what it takes, and you got to do it. Get out there make those calls, know your numbers and year… that pretty much sums it up.
Dan: You will feel better cutting that first check to somebody else you bring on, than you will receiving your own checks, trust me.
David: Great point, that’s a great point.
David: Well thanks Dan, we have had a great time.
Dan: Thank you.
David: Absolutely. Until next time guys, thanks.
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