Cold Calling Expert Nicholas Nick Explains How Knowing Your Numbers Is Key

April 13, 2023

Episode 172: Leadership Insights with Nicholas Nic, founder, CEO, and CFO of Lead Mining Pros

The Profit First REI Podcast

April 13, 2023

David Richter

In today’s episode of Profit First for REI, we are joined by Nicholas Nick. He is a real estate entrepreneur and the founder, CEO, and CFO of Lead Mining Pros, a real estate lead generation company with a focus on cold calling.

Nicholas started his journey in the restaurant industry and from there developed a unique skill set that he carries to this day, wearing as many hats when it comes to running his business. He shares how he uses his roles to run his business at the fullest potential but recognizes the importance of eventually hiring someone to take over.

Tune in to hear more of Nick’s insights into leadership, the importance of knowing your numbers, and the power of cold calling!

Key Takeaways:
[00:45] Introducing Nicholas Nick and His Background

[06:47] On Knowing His Financials

[10:03] Leaving the Restaurant Scene and Starting His Real Estate Journey

[18:15] Lead Mining Pros and Their Cold Calling Services

[20:31] On Maintaining His Hands-On Leadership Methodology and Exiting His Business

[24:54] Seeing the Future in Numbers for His Business

[27:58] Why Investors Live Deal-to-Deal:

[32:32] Connect With Nick

Quotes:

[27:16] “If you’re not good at math, you’re never going to get rich. Plain and simple.”

[28:41] “What makes me successful is I learned to do everything as cheap as humanly possible myself. And then when you do it as cheap as humanly possible, and you’re really good at it. That only means now that throwing money at it makes you better.”

[31:46] “My personal secret to success is not being attached to the result…I’m more attached to the experience that I’m getting,”

Connect with Nick:

Website: https://leadminingpros.com/

Tired of living deal to deal?

If you are a real estate investor or business owner who is tired of living deal to deal, and want to double your profits, head over here to book your no-obligation discovery call with me. Either myself or someone from my team will hop on a short call with you to get clear on your business goals, remove any obstacles holding you back, and map out a game plan to help you finally start keeping more of the money you work so hard to make. – David

Transcription:

Nicholas Nick:

What makes me successful is I learned to do everything as cheap as humanly possible myself. Yeah. And then when you do it as cheap as humanly possible and you’re really good at it, that only means now that throwing money at it makes you better.

Outro:

If you’re a real estate investor who’s sick and tired of living deal to deal, then welcome home. Hear from everyday real estate investors just like you, and discover how they’ve completely transformed their business by taking a profit First approach. This is the profit first for REI podcast, where we believe revenue is vanity. Profit is sanity. It’s time to start making profit a habit in your business. So here’s your host, David Richter.

David Richter:

We have Nicholas Nick on the show today. If you don’t know him, then he has as much a character as his name Warren. And he is an awesome guy and honestly has a ton of experience in the real estate space, business management, and now is his own cold calling company. But he also talks about how he sees the numbers and how it helps him see the future. And from his days, you know, 10, 12 years ago from being in the restaurant industry to now being in the real estate world and really knowing the numbers and then talking about his experiences versus just results in what you should be able to see along on the journey. And even if you don’t get the results that you want, led up to that point too. And just really good information, solid information. A lot of fun on this episode too cuz like I said, Nick is a character. Please get some value out of this and we really appreciate you listening to this. Thank you so much for listening. Have a great rest of your day. Hey everyone. David Richter here with Nicholas Nick, exciting guest and I am super excited to have him on. He is the CEO of Lead Binding Pros. He’s also worked in the restaurant industry, in the real estate industry. He has a ton of knowledge and experience. He’s also like a numbers guy too. Like one of those, you know, the entrepreneurs that actually likes digging into the numbers and feeling like a business owner. So that’s what we’re gonna talk about today, his background. So Nick, thank you so much for coming on today.

Nicholas Nick:

Yeah, absolutely. As thank you so much for having me David.

David Richter:

Yeah. Well okay, first of all, I’m gonna ask the question that everyone wants to ask Nicholas. Nick, have you gotten made fun of your whole life for that or do you love the, your name?

Nicholas Nick:

Well, you know, I think the best summary is I had a cashier asked me at Starbucks once and she said, what is it like to have the same first name as your last name? And I think the quickest response was that I get held extremely accountable for all of my actions.

David Richter:

Okay.

Nicholas Nick:

And that’s cause nobody ever forgets who I am.

David Richter:

Right. <laugh>,

Nicholas Nick:

You know, not only is the name clearly something, but my personality matches the name.

David Richter:

Oh yeah.

Nicholas Nick:

So you put us both together and you’re never like, who was that guy again? So if I ever did something wrong

David Richter:

Yeah.

Nicholas Nick:

Or had a bad reputation, then I would actually be hurting like the next time I wasn’t the kid in the back of the class who everyone forgot.

David Richter:

Right.

Nicholas Nick:

Like when he fell asleep. Like everyone knows when Nick Skips school because there’s not all this talking coming out of the other side of the classroom.

David Richter:

Yeah. <laugh>. Okay. I just wondered, I’m sure that a lot of people would wonder out like listening to the podcast and I wanna get that question outta the way so we could get to the real stuff. So tell people about your background, cuz I know you worked in the restaurant industry even before we started recording you talked about like how that prepared you being CEO and CFO of your business and numbers and how important they were. So I guess just tell everyone just that high level overview and then we can go into the nitty gritty questions.

Nicholas Nick:

Absolutely. Well yeah, so I had a really unique background. I came up as a restaurant employee. I was a cook for two years and then lucky for me, I had a natural management skill thanks to my father. And uh, he was always pounding diplomacy and communication into me. And my dad was, he was into building trusses, roof trusses. So that’s all math. Growing up math homework was always very interesting cuz my dad was so good at it. But anyways, that led into my restaurant career. Now what a lot of people don’t know about restaurants is that the p and l actually runs the restaurant. When you get to work, you go to the spreadsheet, you pull up the p and l and it tells you what to work on. If you spent too much money yesterday on employees, well guess what Buttercup, you gotta send employees home today and make up for what you wasted yesterday. Right.? So it was like if you could like play a video game that managed a p and l, that’s what restaurants were. And now one of the reasons why lead mining is an amazing profit machine, I’ll share with everyone, my business is about 65 to 75% profit, which is really high. That’s due to a couple things. One, what the restaurant industry taught me, and two, I carry a lot of roles myself, <laugh>. Okay.

David Richter:

Okay.

Nicholas Nick:

So you know, I’m not gonna lie to you David, you throw in one, $200,000 a year employee into my operations and I’m not that profitable <laugh>.

David Richter:

Right? yeah.

Nicholas Nick:

Okay. But because what of the restaurant did to me, it made me a C F O, it made me a CEO, it made me a director of human resources.

David Richter:

Yeah.

Nicholas Nick:

Because restaurants don’t have those positions. Right. It’s up to you to manage all of it. So now I’m able to wear four hats and it doesn’t drain me cuz it’s what I did for 12 years as a manager. So it’s really cool. And on top of that, the systems that restaurants teach you, the follow through the process. Like I joke and I say I used to teach people that didn’t even speak English how to work at a restaurant. So imagine how good I am with someone who actually speaks English. Right?

David Richter:

Right. Yeah.

Nicholas Nick:

And so I’ve got all this experience, uh, with employees. So it’s kind of cool the way it’s all come together because if you look at my business now, about a million dollars a year, 30 employees strong, 65% profit, it’s easy to forget that the restaurant industry literally built me brick by brick. Whether I saw it that way at the time or not.

David Richter:

Right.

Nicholas Nick:

Because I hated that career while I was in it. I hated it after I quit it. But now that I’m eight years removed, I’m like this is literally my Bible story. Like I tracked through the desert for so many years to learn the lessons, to now know how to live a beautiful life, You know?

David Richter:

No, that’s awesome. Because it was almost like another college education, right? Because that’s what I feel like my early days in real estate were. It’s like,

Nicholas Nick:

Yes.

David Richter:

Way better than any college education that I got.

Nicholas Nick:

Absolutely.

David Richter:

For that real world application.

Nicholas Nick:

Yes.

David Richter:

Okay. So you say you had to like run it by the p and l the next day. So was that a part of that becoming the CFO F or like knowing the numbers, like would you have gone into business if you weren’t in the restaurant business? Do you think you would’ve been intron as, cuz I see your posts today and I love the post where you’re like, you’re open with your numbers and you’re like, this is what I’m tracking and stuff. And it, it’s very eye open. Like Nick knows his numbers, like I know that he loves this. So would you, do you think you would’ve been like that because, I don’t know, be maybe because of your dad or your background or those types of things that you would’ve had that innately or no? Like no, I would’ve just been running and gunning, hopefully been around.

Nicholas Nick:

Oh yeah. You know, I’ll be honest with you, my p and l now I should show it to you, but it runs my whole business now. And I feel like, would I have still created this business? Yes. I probably would have, would I have four cars, a million dollar property and be surrounded by murals? No, I’d probably be stressed out wondering where all my money is. But the p and l, what it is for me is, and I wish we had more time, I’d actually pull mine up. I’m not transparent, but I see everything, how many dials we did, how many hours we took to dial, how many dials we did per hour, to see how that compares. And when you’re open for six years and you have your weekly dials per hour for six years, you begin to see things differently. Like I can literally, and you already know this man, but I can literally see the future through numbers. Okay

David Richter:

Yeah. And I’ll just share one small story just so they can get a little glimpse on what you and I already know. I ran IHOPs for four years. That was a big part of my experience.

Nicholas Nick:

Okay.

David Richter:

And i hope, despite the late night crowd, was actually my best training experience of any restaurant job I’ve ever had. And one thing they did is they tracked sales by day. Part 4:00 AM to 8:00 AM 8:00 AM to noon, noon to four, four to eight.

Nicholas Nick:

Okay.

David Richter:

And I worked in nine different IHOPs during my time. I was a traveling manager and I can’t even tell you how many times cuz you manually filled out the hours or the sales, how many times? Two, literally the dollar that it was the same exact sales as one year ago on the same day at the same time. And when you start to see how cyclical this world really is, you start to really respect numbers a lot more. So that’s kind of what taught me that whole thing was seen that how cyclical everything is.

Okay, wow. That’s, that is crazy and incredible and it’s, that’s uh, that gave you very healthy respect for the number side, which is great cuz now I like the profit margins as you’re running those types of things, which is incredible. So it sounded like though, back when you were in it that you did not like it. Was it the daily grind? Was it the training? Was it the restaurant smell? Was it the lawn hours? Like what was it about that experience that you No, that was like, or was it all of it and like I hate

Nicholas Nick:

It all? No, you know, I’ll be honest with you man, I loved it for so long.

David Richter:

Okay.

Nicholas Nick:

So when I said I hated it, I did misspeak a little bit cuz I was only channeling my energy after I left the industry. Oh, okay. So after I left the industry, I was really mad at myself for being so skilled and sticking around in such a low skilled environment for so long, if I could be honest.

David Richter:

That makes sense.

Nicholas Nick:

While I was in it, bro, I was like a barbarian in battle, you know? I mean I loved firing people, I loved hiring people, I loved problems, I loved solutions. And that love actually kept me there for 12 years. Stupid and happy. Okay.

David Richter:

Yeah.

Nicholas Nick:

And then literally, I think you’re close to my generation. I was such a good manager. My customers were happy, my employees were happy. Like when I was around, everybody was happy. But in the end it was me who wasn’t happy.

David Richter:

Mm-hmm. <affirmative>

Nicholas Nick:

And I was looking around, I felt like Santa Claus, like I’m bringing all these presents to all these people and no one’s brought me anything

David Richter:

<Laugh>.

Nicholas Nick:

Right. And I realized, and this is what they say, no one’s coming to save you.

David Richter:

Yeah

Nicholas Nick:

I can guarantee you it’s every restaurant employee’s dream to have a customer who’s rich, identify their skillset and give them a job and rip them out of the restaurant industry. Okay. And technically that’s what I almost was waiting for. I’m gonna be the best manager ever and one day Bill Gates is gonna walk in and he’s gonna give me a job. Okay. And I realized that it’s up to me to do that for myself. And I will say I’ve learned that a lot of careers when, when I’ve spoken to other entrepreneurs about 12 years, that feeling that I had seems to kick in for a lot of people. And for me, the reason that really staed me out, burnt me out was there was no new problems. I knew how to handle stealing employees. I knew how to handle hair in the food. I knew how to handle people calling into work. Like I remember I just say, please something new. Just give me something new.

David Richter:

<laugh>

Nicholas Nick:

That’s all. You know. Um, and so that, those are the parts that I didn’t like in the end.

David Richter:

Okay, no, that makes sense cuz that’s, uh, you almost felt like a cage animal, you know, like I wanted to go out there and and hunt, but I couldn’t really, and I was waiting for someone to come open the door, but no one’s opening it for much.

Nicholas Nick:

That’s right. And so, and that’s what actually what I was getting at when I mentioned your generation is it literally, I never that smashing pumpkin song until this moment. And I was like, despite all my rage, I’m still just a rat in the cage.

David Richter:

Yeah.

Nicholas Nick:

And except for me, it was despite all my greatness, like I’m showing up so hard for all these people and there’s still no claw game coming and ripping me out

David Richter:

<laugh>

Nicholas Nick:

Of this world. You know?

David Richter:

So what’d you do? So how’d you go from that to like the real estate industry or your next venture?

Nicholas Nick:

I Walked out. I walked out. So my job forced me to, I actually, they transferred me to a new restaurant. This is a true story. They transfer me to a new restaurant and we’re salary. So I’m only making 65 Gs a year no matter what, no matter how many hours I work. So they trans me to a new restaurant and I showed up and I’m scheduled six days a week, 15 hours a day. Okay. That’s 90 hours a week.

David Richter:

Yeah.

Nicholas Nick:

For anyone who’s, who needs a calculator. And it was for six weeks. It was a six week schedule. And let me tell you, you can already probably tell by my personality I’m not a pushover. Okay. <laugh>. So

David Richter:

Oh, well.

Nicholas Nick:

Oh, shocks guys. You know,

David Richter:

<laugh>.

Nicholas Nick:

And so I called the vice president and I said, I don’t know what the hell’s going on here. Oh. And by the way, everyone else was scheduled five days. Okay.

David Richter:

Okay.

Nicholas Nick:

And um, and I was like, guy, I don’t know what’s going on here. My rule is I’ll work with the teamworks if we’re all working six days, 15 hours, I’ll work six days, 15 hours.

David Richter:

Yeah.

Nicholas Nick:

I’m not gonna be the only one doing anything. Okay. They said they fixed it. I showed up to work the next day, I’m two days in to this schedule and they didn’t fix it. And I was like, you know, I’ve been here for five years, I’ve got tons of tenure, if this is how you wanna treat me. And I was already, for the record, I was already gonna quit in December. If I couldn’t find another job, I was already burnt out. They literally started the fire that started burning my boats <laugh>. I was like, alright. And I left them and I sat unemployed for nine weeks. Okay. And not on purpose. I applied to every job in the world and I applied to this job that was a real estate education company that taught people how to invest. Okay. It was an awesome experience. And they had an interview and they didn’t hire me. And two weeks later, as the desperation grows, right?

David Richter:

Right.

Nicholas Nick:

For multiple reasons. One, I’ve been working 70 hours a week for 12 years. Okay. And two, I don’t feel good about not earning income. I followed up with them and I go, Hey guys, I feel like we had a great talk and I’ve never followed up with the position ever before in my life.

David Richter:

Yeah.

Nicholas Nick:

And uh, they said, Nick, we totally forgot about you. Can you start tomorrow?

David Richter:

Wow.

Nicholas Nick:

And that, yeah. Insane. And that was, I had no idea what real estate was. I’d been flipping burgers for nine freaking years.

David Richter:

Right. Yeah.

Nicholas Nick:

You know, I didn’t even know that. And then this was mentorship. So like, we’re like selling therapy sessions with real estate investors to help people who wanna be real estate investors. Like I was like, what is this world that I’m in?

David Richter:

<laugh>

Nicholas Nick:

You know, I worked there for three months, David, before I even knew what the hell they did. I swear to God I was good.

David Richter:

That’s right.

Nicholas Nick:

But my problem solving, we spoke about that a lot.

David Richter:

Yeah.

Nicholas Nick:

Well what led me here in as short and as few words as possible, I’m a little long-winded, please forgive me. But what got me here was I was solving their problems. Our students were very disappointed that direct mail wasn’t working. Okay.

David Richter:

Mm-hmm. <affirmative>

Nicholas Nick:

And direct mail has a cost to the government. Like you can’t even get around that cost. Right.

David Richter:

Yeah.

Nicholas Nick:

There’s no cheaper way. And I started teaching people this free method that you may have heard of, it’s called Cold Calling. And so I actually created this business three years before I created it. But I didn’t know it. I was teaching people how to cold call. Not because I knew it was the way, but because it was simply free as long as you had a cell phone.

David Richter:

Yeah.

Nicholas Nick:

And everyone was complaining about the cost of direct mail. So we started teaching all these people how to cold-call and it worked. And then when that job came to an end as all jobs do, I realized that I was onto something and I started cold-calling every day. And our first six months, true story, I went from making $67,000 a year even as an executive at that education company. My first six months

David Richter:

Yeah

Nicholas Nick:

With lead mining we did $360,000.

David Richter:

Wow.

Nicholas Nick:

In sales. It was crazy.

David Richter:

Yeah. That’s quite a change. So <laugh>That’s awesome.

Nicholas Nick:

I was still living in a 900 square foot apartment with my girlfriend, her son, and and a roommate. So I was <laugh> dude. That’s how much I was hurting, uh, whenever this business blew up.

David Richter:

Yeah. Well that’s, that’s incredible. So how long were you at that education company then?

Nicholas Nick:

Three years.

David Richter:

Yes, three years. So the first three months were like, okay, what are we even doing <laugh>. And then it was like then learning the actual real estate investing ropes. How long have you had a lead mining up at

Nicholas Nick:

Kron? Well, we’re six years this year.

David Richter:

Really?

Nicholas Nick:

Yeah.

David Richter:

That’s awesome.

Nicholas Nick:

You probably know the numbers more than I do on this side because you know, the CFO background. But

David Richter:

Yeah

Nicholas Nick:

Man, I’m so blessed and after six years I can, we’ve really hit our stride. Like I don’t even really need much marketing anymore or you know, I mean we’re almost like Kleenex nowadays almost. We’re getting there.

David Richter:

Awesome. So then lead mining is cold calling. Correct. So that’s where you’re going in there. And then just so people know you’re teaching now and what you’re providing. So just talk a little bit about what you’re actually providing to for

Nicholas Nick:

Yeah, So what I’ve created at Lead Mining that makes us incredibly unique is we’re a done for you system where we pull the list, we skip trace it, we cold call it and we text it. You don’t have to pay a cold calling company, you don’t have to find a dialer, you don’t have to pay texting overhead. And I think you probably know as well as I do working with all these investors, the subscription costs alone to manage all those services before you even pick up the phone and start working is going to exceed probably $800 a month if you’ve got the texting and the calling and all this stuff. And so what I offer is no contracts, no commitments, no setup fees. Every single product we offer is individually single serving. So you can come in and choose to work with me. And one of my clients earlier just today said, you know, I can’t believe you don’t do contracts. And I said, you know, I like my clients the same way I like my girlfriends and if I just met my girlfriend and she had one great date with me, I wouldn’t make her sign a contract saying she was gonna spend the next year with me.

David Richter:

Yeah.

Nicholas Nick:

And that’s not a way to kick things off. I want her to wake up and want to be by myself. I want my clients to want to be in my life. So I’ll be honest with you, the reason why I don’t do contracts is very selfish because it feeds my ego when clients want to be here. Not me going ha ha, I got them. They’re never going anywhere. No, I got them because they are making a powerful decision to be with my team.

David Richter:

No, that’s awesome. So this has been an interesting journey to get to this point. So now owning your business for six years, do you think that uh, and you’re still staying in some of those seats? Correct? Cuz you said that you, you’ve got a great profit margin because you’re doing a lot of that.

Nicholas Nick:

Yeah.

David Richter:

Do you enjoy working in the business still and being like that person? Or do you see yourself getting out of it in the future?

Nicholas Nick:

So my goal at the advice of Tom Kroll is I’m gonna spend the next two years doing what I’m doing now.

David Richter:

Cool.

Nicholas Nick:

Okay. At least one. But my goal is two super next year doing this and I think at the end of this year I’m gonna hire someone to replace me. And I was doing the math and I was like, God nick, if you’re making $700,000 a year and net and you pay someone $120,000 to do everything that you’re doing right now, well yeah. That’s still five 80 <laugh>.

David Richter:

Yeah.

Nicholas Nick:

And I just got my whole life back <laugh>.

David Richter:

Right.

Nicholas Nick:

And maybe I get to fall into things I like now. However, I will rebuttal by saying that because I have 30 employees, I don’t do anything I don’t enjoy. Right.

David Richter:

Okay.

Nicholas Nick:

That’s what employees are for. No offense to employees nationwide, but like you’re there. If your boss loved doing it, they wouldn’t have you there. <laugh>, you know, and me, so I don’t like making the calls, I don’t like doing the text messaging, but dealing with the people is a huge passion of mine. And I then again revert to the restaurant days. I mean, I was shaking hands and kissing babies for a thousand people a day.

David Richter:

Yeah.

Nicholas Nick:

For 13 years. It’s so natural for me to interact. So that’s the part that I love. I definitely wanna step away more from system supervision. Okay.

David Richter:

Okay.

Nicholas Nick:

Like I love the people, I’ll talk to customers till I’m 70. Right.

David Richter:

Yeah.

Nicholas Nick:

But I don’t necessarily wanna be the investigator when a system breaks or like right now I’m also the main system creator and the main accountability manager and the main implementer. Right. I would probably love to give those away and then just supervise someone else doing all of that. However, I also respect that I’m a genius at those things. So finding someone to meet my level of know-how and determination in those levels is not easy <laugh> either.

David Richter:

Sure. No, I get it. It’s uh, it’s hard to hand off, hand off the baby to other people to be able to do, to run it and to be able to go go to the next level. Okay. Well this has been an interesting journey. So restaurants, real estate education, then you’ve got the lead mining. Do you see lead mining taking you off into the sunset? Or do you see it as like, do you wanna do other things in as Businesses?

Nicholas Nick:

No, I wanna do other things only because I don’t wanna be a one trick pony.

David Richter:

Sure.

Nicholas Nick:

So I’ll be honest with you, I really wanna create a physical invention. Alright.

David Richter:

Okay.

Nicholas Nick:

I’ve, yeah. I’ve got this great idea right now that’s funny and fun and true called I’m calling the bed straw. Okay. Like I get really thirsty while I’m laying down in bed.

David Richter:

Yeah.

Nicholas Nick:

And I fucking hate sitting up

David Richter:

<laugh>

Nicholas Nick:

To like get a sip of water. It sounds stupid. Right?

David Richter:

That’s great.

Nicholas Nick:

It’s like, but dude, imagine just having like a hose and a water cooler next to your bed and you’re just like, oh yeah. Like you’re just, you’re like a baby drinking from a bottle again.

David Richter:

Yeah.

Nicholas Nick:

You know, and I can’t tell you, like I get really thirsty at night and then sometimes cuz I’m an entrepreneur, I can’t sleep. So I’m like, I freaking I’m getting like a cramp in my shoulder from sitting up to drink. But, so, you know, my goal is to really create a physical invention. Um, I do think lead mining will take care of me for the rest of my life.

David Richter:

Yeah.

Nicholas Nick:

To answer that question. Um, do I want it to be where all my eggs are in that basket? Not really. I wanna buy distressed businesses and make them better if I had a dream, um, and I want to um, I wanna bring lead mining the five mill a year and um, and then I just wanna have properties on the side as well, you know, some income.

David Richter:

No, that’s awesome. I just wondered where you thought the next steps were gonna take you.

Nicholas Nick:

Yeah.

David Richter:

I do wanna hit on one point. You have mentioned a while ago you said you see the future through numbers and I’m wondering how if there’s, that’s still applicable today in your business. Because obviously it sounds like in the restaurant business it was like I could have looked back a year and it’s almost to the penny

Nicholas Nick:

Right.

David Richter:

You know, on this specific day at this certain time. How about for like lead mining pros or the what you have today? Is it, I’m guessing it’s not as like this is a hundred percent the same as last year, but help, how does that help you know, the numbers now to be able to predict?

Nicholas Nick:

Well, so now the way I see the future is through my KPIs. Ok. So for example, um, we see a different future, right? So I think as the CFO role comes in, I’m more or less looking for mistakes than bonuses.

David Richter:

Yeah.

Nicholas Nick:

Right. And so like, hey, how many dials did we have last week?

David Richter:

Yeah.

Nicholas Nick:

Okay, how many did we roll over? All right, well if we rolled over this many, that means I’m short on employees. Right.

David Richter:

<hmmm>

Nicholas Nick:

And I track all that on my p and l, my PN l’s, not just costs and money, it’s performance.

David Richter:

Yeah.

Nicholas Nick:

And it’s um, it’s follow through. It’s what’s happening next week so that’s an indicator how many dials are being rolled over. The other one is leads per hour. If that it goes really low, that means I know someone’s stealing from me. Right. So if my dials per hour drop, which it never does, I got a great team, thank the holy Lord, but they don’t, and they don’t even know I watched that number cuz I never hold it over their head. But I can immediately tell when someone’s clocked in and not working. So I guess when I speak of seeing the future now I’m more or less preventing a negative future

David Richter:

Yeah.

Nicholas Nick:

Than seeing a positive one, I guess would be a way to look at it the way I’m using the numbers now.

David Richter:

Oh no, that’s really good. I like that a lot where you’re preventing that negative future instead of just seeing the positive one. Cuz the positive one you can see through, uh, you can really see that, like you said through the KPIs, but then on the financial end it’s like, okay, I wanna make sure I stay away from my death life.

Nicholas Nick:

Well where are we trending? You know? Um, I’ve really been a lifelong mathematician. I call myself, you know, um, I’ve got a great quote that I’m sure you would love to steal. And it is, if you’re not good at math, you’re never gonna get rich. Okay. Plain and simple. If you don’t know how to make five equal 25, then you’re not gonna make your bank account multiply by five either.

David Richter:

<laugh>, right.

Nicholas Nick:

<laugh>. And that’s really been one of my greatest skill sets is, you know, the way that I see the numbers and maneuver around them. Uh, again, the hard part becomes teaching that it’s almost like a numerical intuition that I have. You know, I call it like the matrix. Like all I see is numbers and I know exactly what to do,<laugh>.

David Richter:

Yeah. Oh, that’s great. And a lot of people don’t have that financial intuition. So why do you think on a real estate investor they put off, you know, like a typical real estate investor lives deal to deal doesn’t make the money, definitely doesn’t have 65, 70% margins, you know, like, or net profit or whatever. Like, so why do you think they live? And a lot of people even might be listing right now living deal to deal.

Nicholas Nick:

Yeah. So why do I think that they’re in that position? Is that the question?

David Richter:

Yeah. Why do you think they’re in that position?

Nicholas Nick:

Great question and I’ve got a great answer, but no one’s gonna like it. And it’s because like, my story is the reason why I’m successful and I wasn’t silver spooned, I wasn’t given a great life. We were poor as hell growing up. And what makes me successful is I learned to do everything as cheap as humanly possible myself.

David Richter:

Yeah.

Nicholas Nick:

And then when you do it as cheap as humanly possible and you’re really good at it, that only means now that throwing money at it makes you better. And I think that the average person seeks to outsource seek. And even though I am an outsource, I know that they’re gonna, but you know, they have to have some type of knowledge on it. You know, someone doesn’t hire you if they’re already, Hey, I did a million, I got $900,000, I need a cfo. They’re like, Hey, I’m a little upside down. I can’t see through my problem. Can you help me fix this? And, and that’s a wisdom. You wanna know how far you can take it. So another example is, my clients are happiest with us when they’ve cold called before they found us.

David Richter:

Mm-hmm.

Nicholas Nick:

Right. So like, just how your clients are happiest. If they were running their own books before they found you, they’re like, oh my god, I know how much you’re helping me <laugh> right now.

David Richter:

Yeah.

Nicholas Nick:

And it’s like, it’s that person who is not overly committed to doing the task, but they’re committed to dipping their toe in. I think that is the successful person, and I think that that’s one of the main things because direct mail doesn’t work. Cold call, well cold call yourself close your first deal. I’ll tell you what, don’t call me with your last $300 and say, Nick, I need to close a deal.

<laugh>. Right. Don’t.

David Richter:

Yeah,

Nicholas Nick:

No kidding. You know, and, and you know, and I’ll be on, people say that to me. I need to make money. I’ll tell you what, go buy mojo dialer, okay. And buy a list from us and I’ll give you the script for free, but do not give me your money if it’s the last penny you have. That’s not the place. And so I think if we were to summarize all that advice, it’s action taking for the sake of experience. And I think that’s important. Not for the sake of result.

David Richter:

Right.

Nicholas Nick:

Right. I don’t give a shit, you know, I cold call for three months myself and I never closed a freaking deal and I still was on that phone every day with the smile and I gave myself what I call micro wins along the way. If my seller that I was talking to said it was great talking to you, huge win.

David Richter:

Yeah

Nicholas Nick:

If they’re like, have a great day, I’m like, huge win. If they’re like, thank you so much for your time. So I what I do, so now to deconstruct my advice, how do we get there? How do we keep doing things that we hate to get the experience that we need to get to the next level Is you have to create wins other than the final win.

David Richter:

Yeah.

Nicholas Nick:

Just try being pleasant while eating shit all day. And then when you get good at that, then get good at the next part. And then once you have these skills, then leverage them into the next thing. And at least that’s been my personal secret to success is not being attached to the result and I’m more attached to the experience that I’m getting.

David Richter:

Oh, that’s really good. Be attached to the experience, not just the result.

Nicholas Nick:

Yeah.

David Richter:

And making sure that you’ve, that you know where you are. And that’s, uh, I like what you said too, the people that like us the most are like you the most are the people that have done what they’re trying to get accomplished. So they know like, oh my gosh,

Nicholas Nick:

They know what we’re doing. Yeah. When I have a client say, Nick, you got me three leads in 500 dials. They were like, I did 5,000 dials and I couldn’t even get someone to pick up the phone like that person, I mean, that was probably a different problem, but people have said that to me, <laugh>.

David Richter:

Right.

Nicholas Nick:

You know, but they still, they have so much gratitude now.

David Richter:

Yeah.

Nicholas Nick:

That was the verse.

David Richter:

No, that’s awesome. So I guess just one final question. How do they get in touch with you? What’s the best place to go for lead mining prose or whatever else you wanna send ’em to?

Nicholas Nick:

Yeah, Absolutely. Yeah. So leadminingpros.com uh, is the best way to find me. Uh, my cell phone number is actually on the website, so when I say I wear multiple hats, I am not kidding. Um, answering that phone is my favorite part of the job and, uh, feel free to call and test it out, but the phone number on the site is my cell. And so if you take a look at the site, you have any questions or you just want to test me and see if I actually answer my cell phone, uh, feel free to give us a ring. And, uh, I would love to help anybody out who needs some assistance with their lead.

David Richter:

So leadminingpros.com if you’re looking for a good cold calling company where Nick is going to personally help you and get you up and running with his team. So that’s a great place to go. Nick, this has been awesome. Lots of good stuff. I love what you said. See the future through the numbers, making sure that you’re doing some of this work so that way you know, you have the experience, not just the results you’re going through and making sure for the things that you really need, that you can have that experience as well too. So this has been great. And then if you’re listening to this and you’re like, oh my gosh, I don’t know my numbers or like, I’m def I am not a math person, you know, so I cannot get rich, you know, according to Nick’s advice here, then go to simplecfo.com where you have our fractional CFOs as well too and can put one on your team to be an actual leader there to take all that financial crap off your plate cuz you don’t enjoy it. If you’ve ever done it, like Nick said, you don’t like the bookkeeping or the CPA work or you, if you’re wondering where is all my money going, go to simplecfo.com. We can help you find it and put more money in your pocket. And remember, make profit a habit in your business. Nick, thank you so much for being on the show today.

Nicholas Nick:

Yes sir. Thank you. Appreciated you David.

Outro:

This episode of The Profit First for REI podcast is over, but there are plenty more where that came from. Are you ready to learn how David and his team can help implement the Profit First system in your business? Schedule a discovery call at simplecfo.com right now. We’ll see you next time on the Profit First for REI podcast with David Richter.

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Title: “Profit First Strategies with Jay Conner: The Power of Private Money”

Episode: 242

There are 15 reasons to love about borrowing private money over traditional money. One of them is making your own rules for your private money.

In this episode of Profit First for REI podcast, Jay Conner, a nationally renowned real estate investor and the king of private money. He talks about how private money works.

Jay helps you get your money from private lenders and will share with you the mindset that will get you money in the door without you ever having to worry about it.

Listen and enjoy the show!

Key Takeaways:

[01:01] Introducing Jay Conner

[05:00] Introduction to private money

[08:30] The Great News Phone Call

[11:23] Why don’t you use your own money?

[13:18] Maintaining relationships with private lenders

[15:40] Private money vs traditional money

[22:05] Things that make them want to recommend you

[25:18] Advice for real estate investors

[29:01] Connect with Jay Conner

Quotes:

[07:34] “If you are talking about private money and raising private money with an individual and you got a deal for them to fund, you already sounded desperate.”

[12:07] “If you want to scale your business, private money is the way to go.”

[16:05] “In this world of private money, we make the rules. We set the interest rate, we sent the length and all of that.”

Connect with Jay:

Website: https://www.jayconner.com/book-details/

Tired of living deal to deal?

If you are a real estate investor or business owner who is tired of living deal to deal and want to double your profits, head over here to book your no-obligation discovery call with me. Either myself or someone from my team will hop on a short call with you to get clear on your business goals, remove any obstacles holding you back, and map out a game plan to help you finally start keeping more of the money you work so hard to make. – David

Transcript:

Speaker 1 (00:00):

I got 15 reasons I love private money over traditional money. I won’t share all 15, but the biggest one is it puts you in the driver’s seat. The traditional way to borrow money is you go to the bank and get on your hands and knees and you’re begging and chasing. Well, they are making the rules right? Like the lender is making the rules. But in this world of private money, we make the rules, we set the interest rate, we set the length of the note and all that.

Speaker 2 (00:34):

Speaker 3 (01:01):

We have Jay Connor back on the podcast. I love Jay Connor. He helps you get your money, the money from private lenders and that whole framework and process, but he does it from a passion and a place of heart. And servant Teachership. I feel like he goes out there and is a servant teacher of how private money works. Listen to this episode. He gives the magic question he tells about desperation and private lending, and I thought his perspective was so good, and then ultimately the mindset that will get you money in the door without you ever having to worry about it. So listen to this episode. Can’t wait for you to get value from it. Thank you for being a listener of the Profit First. RII podcast. Have a great episode. Hey, here’s the profit first RI podcast. Really excited to have Jay Connor back because he’s the came of private money. And this is where I love to go into this topic because I don’t care what kind of business you’re in, you probably need help with this, but especially if you’re in the real estate world, this comes up all the time at every event I’m at with every conversation I have. So we’re having the cane here talk about private money today. So Jay, thanks for being on the show.

Speaker 1 (02:07):

Hey David, thank you so much for having me come on here to talk about my most favorite topic. Of course, that being private money. And why is that? Because private money’s had a bigger impact on our real estate investing business than any other strategy that we’ve implemented in our business.

Speaker 3 (02:24):

Why did you go down that road though? I mean, you teach this all the time. You’re helping a ton of people, like anyone I’ve ever talked to that works with you is like he taught me how to do and I got money and it actually works. So I mean, how did you even go down that road where it made a difference on you and then you wanted to get it to others?

Speaker 1 (02:43):

Well, I actually backed into it. I didn’t do it on purpose. So here’s what happened. So my wife, Carol, joy and I, we’ve been investing in real estate, single family houses, other real estate full time here in eastern North Carolina since 2003. And here’s what happened. From 2003 until 2009, David, all I knew to do in my real estate investing business was rely on the local banks to fund my deals. I mean, all I knew to do was go to the bank, get on my hands and knees, put my hand underneath my chin, raise my skirt up so they could look at all my personal financial statements and stuff and actually beg to get my deals funded. That’s all I knew to do. And so I had a big wake up call in January of 2009 after being in this business here in Eastern North Carolina. I called up my banker.

(03:38):

I told him about these two deals I had under contract in Newport, these two single family houses. And David, I learned like that over the telephone that my line of credit had been shut down with no notice. My banker, his name was Steve, and the bank was bb and t at the time. I said, Steve, what in the world are you telling me? My line of credit is shut down. I got two deals under contract. You gave me no notice. Why is the bank closing my line of credit? He said, Jay, don’t. There’s a global financial crisis going on right now. I said, no, but now you just gave me a global financial crisis. Financial crisis, yeah, I ain’t got no way to fund my deals. And I got ’em under contract. So I hung up the phone and here’s what happened, David. I sat here and I asked myself a very important question.

(04:27):

And so I’m going to share this question with your audience right now. This question I’m going to share with you will help you solve any problem you’ve got. I don’t care if it’s business, financial, career, health, relationships. I don’t care what your problem is. By the way, David, these people going around and saying, any problem, you got some opportunity I want to throw up. I didn’t have no opportunity. I had a problem of not funding my deal. So here’s the question I asked myself. The question I asked myself was, Jay, who do you know that can help you with your problem? And when I asked myself that question, I immediately thought of my good friend Jeff, who lived in Greensboro, North Carolina at the time, and he was investing in real estate. And so I called him up and I told him what happened. And he said, well, Jay, welcome to the club.

(05:18):

I said, what club? He said, the club of the bank shutting you down and losing amount of credit. They shut me down last week. I said, well, how are you funding your deals, Jeff? He says, well, have you ever heard of private money? And I hadn’t. So Jeff told me about private money. He told me about self-directed IRAs and how people can use their retirement accounts and funds that they currently have and move them over to a self-directed IRA company and then loan that money out to us real estate investors, either tax deferred or tax free depending on the type of account they’ve got. Well, that just opened up my whole world. I’d never heard of that. And so what did I do? How did raise $2,150,000 in less than 90 days after being cut off from the bank? Well, here’s what I did, and here’s the secret sauce I put on my teacher hat.

(06:10):

So I put on my teacher cap, which is my private money teacher cap, and I just started teaching people in my own network what private money is, how they can earn high rates of returns safely and securely. And what’s interesting, Carol, joy and I, we got 47 private lenders right now. Not one of them had ever heard of private money and private lending. Not one of them had ever heard of self-directed IRA companies and what a third party custodian is. That’s important by the way, to establish a relationship with a self-directed IRA company because over half of my private lenders are using their retirement funds. And if I didn’t have that relationship to introduce them to move their retirement funds over, I’d be missing out on over half of my private money. So how did I go about raising all this money when I was cut off from the banks?

(07:02):

I led with a servant’s heart. I led with education. And here’s a really, really important point. I separated the activity. I separated the conversations of telling people what private money is and how they can earn high rates of return safely and securely and having a deal for them to fund. You see, desperation has got a smell to it. And when you talk about is that not true, David? Yeah, very true. So if you’re talking about private money and raising private money with an individual and you got a deal for them to fund, you’re already sounding desperate and you’re not even trying to sound desperate. So we don’t talk about deals and when we’re first exposing somebody to how they can earn high rates of return, we talk about private money. So how do we separate those conversations? Well, when someone has told me that they’ve got, let’s say they’ve got $150,000 they want to invest and get high rates of return conservatively, I’ll say, great, I’ll put your money to work for you just as soon as possible.

(08:11):

I don’t talk about a deal upfront. If they’ve got retirement funds that they want to get higher rates of return on, I’ll introduce ’em to the self-directed IRA company that I recommend. They’ll get their funds moved over. And so here’s what happens and here’s the magic sauce, David, I give ’em and I call ’em up with what I call the great news phone call. What in the world is the great news phone call? Well, the great news phone call is not a pitch. I’ve never pitched a deal in my life ever since I started raising private money in 2009. I pick up my handset with my cord attached to it here in North Carolina and I call some of your, don’t even know what that is. And let’s say, David, let’s say you’re one of my private lenders. So I’ll put my phone right up here and you’ll answer the phone and we’ll have a little chitchat and I’ll say, Dave, I got great news for you.

(09:06):

I can now put your money to work. I got a house in Newport with an after repaired value of $200,000. The funding requires 150. Closing is next Tuesday. You’ll need to have your funds wired to my real estate attorney next Monday. I’m going to have my real estate attorney email you the wiring instructions end of conversation. Notice I didn’t ask If you want to fund the deal, of course you want to fund the deal. You’ve been waiting for the phone call. I’ve told you the program. I’ve taught you the program, you know what kind of rate you get, what the maximum loan to value is, the program that I’ve taught you. And so now you’re waiting for the good news phone call, which I just gave you. And in addition to that, if you as my private lender, if you’ve moved your retirement funds over to a self-directed IRA company, you ain’t earning any money until I put your money to work.

(10:04):

You moved it at my recommendation. Now I’m ethically bound to put your money to work. You ain’t earning any money until you actually put her to work. So again, we separate conversations, we leave with a servant’s heart, we educate, and by the way, David, these people going around saying don’t just get the deal under contract. The money is show up. I want to throw up where is the money going to show up? Is it just going to rain out of clouds or something? No, get the money lined up and you can get it lined up fast. Just like me. There’s always going to be deals.

Speaker 3 (10:38):

Yeah. Oh man, that’s really good stuff. I love how you went down that road and it helped you personally. Now you’re just teaching a lot of people. I love that magic question. Who do you know that can help me with my problem? It’s that who, it’s not always the how. It’s the who did I know, and in that point it really helped you. I also run into a lot of times, I don’t know if you see this, where there’s someone who’s like, I could save a couple interest points if I just use my own money versus a private lender’s funds. What are your thoughts on that of always taking down your own deals versus going out there and putting the work into getting a private lender?

Speaker 1 (11:17):

Sure, I get that question all the time. They say, Jay, you making all that money? Why don’t you use your own money to invest in real estate? Why are you still borrowing private money? Well, here’s the answer. If you’re just going to do one deal, that’s a great use of your money. That’s a fantastic use of your money. But do you want to scale your business? I mean, right now we’ve got seven different projects going on, single family houses simultaneously. Well, I don’t want my money buried in seven houses or projects simultaneously, which here in our local market can easily be over 3 million with the prices of our homes. So if you want to scale and really, I mean most people have got a bottom of the bucket in their checkbook. So if you want to scale your business, then private money is the way to go. Another answer to that question is, do I want to pay myself 8% or do I want to use my money for something else,

Speaker 3 (12:22):

Right? Yep.

Speaker 1 (12:24):

So that’s a couple of answers to why I use private lending and why I’m still using 47 private lenders,

Speaker 3 (12:33):

Which is great. I love what you said. If you want to scale, it can run out of cash real quick. If you just keep using your own money where a lot of people have to choose between, okay, paying some percentage points or sleeping at night, and it’s like, I think I like your option a whole lot better, especially if you’re looking to grow. But I like how you said that one deal. That’s okay, but if you are looking to be a real estate investor, this is something you’re going to have to go down that road. Now, last time I asked you some questions about the private lending process. I don’t think I asked this one though, is how do you maintain a relationship with that many private lenders? You’ve got 47 people in your network that you call up with the good news call. So is it like how do you maintain a relationship with all those people?

Speaker 1 (13:22):

I mail ’em checks.

Speaker 3 (13:25):

I love that. That’s a great answer. Oh man. No better way to keep a relationship there.

Speaker 1 (13:33):

I mean, they love getting money in the mail, right? Yeah. They love mailbox money, so I mail ’em checks.

Speaker 3 (13:41):

So you mail ’em checks. So you’ve built a good enough business where you can keep 47 lenders busy and their money active.

Speaker 1 (13:50):

Well, to be totally transparent, I mean, it is a juggling act to tell you the truth. I mean, there’s more money than there is deals.

Speaker 3 (14:00):

Yep.

Speaker 1 (14:01):

There’s more money than there is deals. And so we got 47 private lenders. Some of them have got $30,000 with us, some of ’em have got a million dollars with us. I can’t buy a house for 30,000, but I can use 30,000 for rehab money. You can use private money, borrow private money in a junior position, you’ve got to disclose that. But I can put private money in a junior lien. But what comes into play there is what we call total loan to value. So I’m not going to be borrowing more than 75% of the after repaired value. I didn’t say the purchase price 75% of the after repaired value. But let’s say back to that example that we just talked about, David, where if I’ve got a after repaired value on a home of 200,000 for easy figuring, I can borrow up to 150,000. That’s 75% of the after repaired value. But if I buy it for a hundred thousand, which I do all the time, 50% of the after repaired value, I can have a private lender in first position at a hundred grand. I could have another private lender in second position at 50 grand. So add a hundred to the 50, now one 50 divided by 200,000 after repaired value, I got a total loan to value of still 75%.

Speaker 3 (15:27):

Yeah, I love that. And it seems like private money gives you flexibility and

Speaker 1 (15:32):

Options. Does that make sense?

Speaker 3 (15:34):

Yeah, that makes sense. A hundred percent.

Speaker 1 (15:37):

Oh, absolutely. Flexibility is where it’s all at. I got 15 reasons. I love private money over traditional money. I won’t share all 15, but the biggest one is it puts you in the driver’s seat. The traditional way to borrow money is you go to the bank and get on your hands and knees and you’re begging and chasing, well, they are making the rules, right? The lender is making the rules. But in this world of private money, we make the rules, we set the interest rate, we set the length of the node and all that.

Speaker 3 (16:14):

I love that. Flexibility is the ultimate play in real estate. You want to have flexibility and you want to be able to have that. So I love what you teach. Who is the person that you’re trying to teach out there? Is it the person that’s done one deal a thousand deals? Who are you trying to help the most with your business?

Speaker 1 (16:33):

Yeah, that’s interesting. At my live events, which is called the private money conference, and my live events, we have about 60% or so have already done deals. They’ve already done deals. They want to scale their business. They are real estate investors wanting to scale their business, and about 40% are looking to get their very first deal. So I’m helping everybody. I mean Stu and Harriet Baldwin from New York State, they enrolled and joined my mastermind membership community and they already had a portfolio of a hundred houses. They’d already raised over $2 million in private money, but they wanted to see how I went about it. Well, just one webinar that I recorded with them brought in 1.2 million in additional private private money. So I’ve worked with real estate investors that are brand new and those that are also seasoned to help them get more private money ready to go for their business.

Speaker 3 (17:33):

I love that. It sounds like a lot of people out there need private money, and even if you’re just getting started, if you don’t have the funds to do that first deal, like you mentioned, you do that first deal, that one deal at a time, it might be okay, but this sounds like a great spot where if you’re getting into it or if you’ve got lots of stuff going on, this could be another way to make sure your company can keep running without what you ran into with the banks back in 2007, eight or oh nine. Would you say that’s true as well?

Speaker 1 (18:04):

Absolutely. Absolutely. I mean, I’ve met very, very few people. In fact, I can’t even think of one. I haven’t met any real estate investor that says, I got enough money.

Speaker 3 (18:20):

Yeah, me either.

Speaker 1 (18:22):

I can’t use any more private money. However, David, you are looking at one right now. I got about almost $2 million right now, what I call sitting on the shelf waiting to be deployed. And I tell you what, I’ve had new private lenders come into my world that want to invest and just to prove to them that I can perform. I’ll take the new private lender’s money and pay off a current private lender, refinance the deal so I can get their money to work for ’em, right?

Speaker 3 (18:53):

Ah, yep, that makes sense. I like that. As you grow and scale, you might run into that issue and you make one lender a little bit happy. I mean, at least they’re getting paid off, but then they probably come back to you and say, I want you to put my money to work again. Do you have that come up a lot?

Speaker 1 (19:12):

Quite frankly, when I pay ’em off, they’re not happy.

Speaker 3 (19:17):

That’s why I said just a little happy, maybe a little bit.

Speaker 1 (19:20):

But when I pay ’em off, they’re not making any money on that money. In fact, with a new private lender, I’ll get ready to pay ’em off cashing out on a deal and I’ll call ’em up and say, Hey, just want you to know that you’re going to have a check coming in the mail from a real estate attorney’s trust account. We’re paying off this house. And they’ll say, Jay, can’t you just keep the money? And I’ll go, no, I can’t keep the money unless I’ve got your money secured by a property because we do not borrow unsecured funds. Now, here’s maybe a little advanced strategy for some folks, but I do substitutions of collateral or loan modifications all the time. If it’s a small amount of money that a private lender’s invested 30, 40, $50,000, and we use it for rehabbing a property. So when I’ve got another property I’m getting ready to start on, I’ll substitute the collateral and keep that 30 or $50,000 note in play. So they keep earning money on that money, but we will substitute the collateral just to a different project that we’re moving to.

Speaker 3 (20:25):

That’s awesome. So then sounds like you have a good problem. It’s like, I want that. Well, I think a lot of real estate investors would rather the problem, I have too much money versus I’ve got these deals and I can’t fund them. So I really like how you teach people that and where it could snowball into this, where it’s like, I’ve got 47 private lenders, I’ve got to go out there and get the deals for ’em. Absolutely. And I really like that. And

Speaker 1 (20:50):

For goodness sakes, you don’t start out with 47 private lenders. I started out with one, right? I started out with one and then that quickly became two and three and four and five because private lenders tell other people what’s going on. So I haven’t actively attracted private money for years because our current private lenders just keep sending us people. In fact, day before yesterday, day before yesterday, I got a phone call from the mother of a good friend of mine, his name’s Craig, lives in Newburg, North Carolina. Craig had told his mother about this investment thing that I got going on and she had never heard of it, which is really funny. I’ve been doing it now private money since 2009. So she calls me up and she says, Hey, my son’s been telling me about this investment thing you got going on. Tell me about it. So word of mouth gets around very, very quickly when you start doing business with private lenders the way I do.

Speaker 3 (21:53):

Yeah, I like that a lot. So in order to get people to talk like that, what are the biggest things that you do for your current private lenders that makes them want to recommend you?

Speaker 1 (22:07):

Well pay ’em on time.

Speaker 3 (22:08):

There you go. That’s a big one. Sounds like that would be a really great place to start.

Speaker 1 (22:12):

Pay ’em on time. But I also have three times a year I put on a party for our private lenders at the Dunes Club. So we have three times a year a VIP reception over at the Dunes Club on the beach, and it’s just an evening of private lenders getting together and we have a good old time and I feed them and give them all the soft shell crabs they want, and I tell ’em to bring their friends with them.

Speaker 3 (22:42):

Yeah, that’s awesome. So number one though, that anyone can do at any stage is pay people on time. So actually pay, would you say, what about communication? I hear that come up sometimes too. How do you do a good job on the communication with your private lenders as well?

Speaker 1 (23:03):

Well, it must be good enough. They never go away,

Speaker 3 (23:06):

Right? Yeah, that’s the big things I hear.

Speaker 1 (23:10):

Here’s one thing I have not delegated as far as communication. I personally, I mean my relationships with my private lenders are very, very important. So I personally pick up the phone, pick up the phone, and call my private lenders when I have got a deal for them to fund. I do not delegate that out. I could

(23:37):

Delegate that out, but I don’t, when I got a deal for them to fund, I’m the person on the phone keeping that relationship When I’m getting ready to pay them off. I don’t have a check just show up in the mail. Of course they got to sign a payoff instruction letter if a different closing agent is closing it for a buyer. But before any of that happens, I personally call ’em up and I tell ’em that we’ve got that property sold. We’re getting ready to pay you off. Or I’ll call ’em up and I’ll say, Hey, we’re getting ready to pay this property off, but I will keep your note open so you can keep earning money. I’m just going to substitute the collateral. We got some documents we’re going to email to you for you to sign and send back the communication. I’m personally involved in putting their money to work and letting them know when we’re cashing out and where they are on the deal.

Speaker 3 (24:31):

That’s awesome. Then since it’s the profit first I podcast here, I love this concept of the private money because you need your cash in your accounts. So to be able to run your business, do those things, and then setting up a separate account just for your private money lenders, so it makes it easier to do what Jay just told you to pay them back, to pay them back on time to be in good communication with them. So now this has been really good. Do you have any other advice before I ask you? How could they work with you? How can they get in touch with, because I know this is something that is needed desperately, that I send people your way all the time. I know I trust you to help people, but any other last minute advice here that you would give to the real estate investors listening to the podcast?

Speaker 1 (25:18):

Sure. I appreciate you asking that question. It’s going to be very hard to own a lot of real estate

(25:26):

Until you own the real estate between your ears. So what do I mean by that? People ask me, how do I start? How do I start raising money? I can tell you how you start raising private money. You get your heart right, you get your mindset right. So what do I mean by that? Well, what do you do? You lead with a servant’s heart, you lead with education, you put your private lender money hat on, you private lender, teacher hat on, and you leave with education, don’t pitch deals, and you really, really are concerned about the other person and realize, part of this mindset is realize you’ve got an opportunity to change people’s lives, right?

Speaker 3 (26:11):

That’s so good.

Speaker 1 (26:13):

We’ve got countless people that are particularly in their retirement years, that have thanked me and Carol Joy for making a difference in their retirement years to where they can, I mean, they don’t want to touch their principal. They want to live off of their principal investment. So they’ve been able to travel, go see grandkids, do all this stuff that they couldn’t do otherwise until they got involved in our program. So just know that you’ve got a way to really make an impact on other people’s lives. And lemme tell you another part of mindset. It ain’t about reaping. It’s not about reaping. It’s all about sowing. It’s all about sowing. I can’t be reaping all that private money and deals until I have sown and given and led with value first. So how you sow is how you’re going to reap.

Speaker 3 (27:08):

Yeah. Oh man, this is so good. I’m glad I asked that question because I hear the passion in your voice and I hear that you really care about the people you work with, the people that have private money lenders out there, you care about that relationship. I love what you said. Get your heart right, get your head right. I also think, like you said too, that if they don’t have that desperation has a smell. So if you’re out there, you’re desperate and you’re just going out there, then you won’t have people like you have that want to keep coming back, that want to continuously invest in you. So that was, I think, the best advice that you could give right there. Get it between your ears and get your heart right. I absolutely love that. And just to recap too, I love your magic question.

(27:55):

Who do you know that can help me with my problem? Then one day you’re going to wake up and you’re going to be like Jay, and you’re going to be helping other people with their problem. I’ve got money. I want to put it somewhere, and you’re the able to get them to where they can be. Desperation has a smell. I love that. And then honestly, I love that pivot. You are like, it’s not about the reaping, it’s not about the interest that I’m making or the profit I’m making for the deal. It’s more about sowing those seeds and ultimately you’re changing lives. That’s why you get private money, and it’s like that interest that you’re paying them is twofold. It’s like you get to sleep at night, you’re not using all your money and you’re getting to help someone else get a return that they wouldn’t be able to get anywhere else or in someone that they trust as well too, and that’s a little bit more tangible than the stock markets or all this other Bitcoin, some of that stuff that’s floating around out there. So this has been awesome. So how do people then, Jay, take that next step with you? Do you have a book? You talked about an event. What can people do?

Speaker 1 (29:01):

Absolutely. Well for your audience, David, I’ve got two gifts. First of all, I finished writing my book Where to Get the Money. Now, this is not a ebook. This is a book book that we actually send in the mail Autographic where to get the money. Now the subtitle is How and Where to Get Money for Your Real Estate Deals Without Relying on Hard Money Lenders or Traditional Lenders. It’ll walk you through step by step how to get all the private money you would want. Very, very easy to read. It’s $20 on Amazon, but you can get it for free. Being David’s audience, just cover shipping. You can go to www dot j Connor, J-A-Y-C-O-N-N-E r.com/book. So I’m an er, not an or. So that’s j Connor, J-A-Y-C-O-N-N-E r.com/book, and we’ll three day priority mail it out to you. Now, in addition to that, I’ve got an upcoming $3,000 per ticket live event right around the corner. But for your audience, Dave, I’m going to let everybody come for free with a measly $97 registration fee. This private money event. You can check it out at www.theprivatemoneyconference.com. The private money conference.com. That’s coming up right around the corner in June. Get on over there. Registrations are open, and I’d love to meet you in person at the private money conference.com.

Speaker 3 (30:31):

Awesome. I’m excited about that too. I love what you’re doing and you’re solving a big need that we hear all the time. Just like all people always needing to sharpen their acts when it comes to private money, you graciously have also invited me there to speak about Profit First. So I’m excited to get to tell people about that so they can get more private money and be more confident and not be desperate when they go and ask for people. So I’m really excited about that as well. So make sure we’re going to put those links there, but make sure either get his book or go to that event. I cannot endorse Jay Moore because I know how many people he helps, but then he also has the heart. You heard it right here. That’s how he wants to help you too. It’s very much a heart and a mission and a passion for him.

(31:13):

So Jay, thank you for coming on, for sharing your wisdom, your knowledge today. If you are listening to this episode and you feel stuck like, what the heck is going on? Where is my money? I don’t know what to do. I’m a little bit nervous to go out there and get private money. I can’t keep my own house in order. That’s where you could go to simple cfo.com where we can help you walk you through that process. We’ll link you up to Jay too. If you need private money or need to learn about private money, this is who we recommend. I recommend Jay to many people, so make sure that if you need that help you go to simple cfo.com. But Jay, again, thank you for being on the show and sharing your wisdom here today.

Speaker 1 (31:51):

David, thank you so much for having me. God bless you.

Speaker 2 (31:54):

This episode of the Profit First for REI podcast is over, but there are plenty more where that came from. Are you ready to learn how David and his team can help implement the Profit First system in your business? Schedule a discovery call@simplecfo.com right now. We’ll see you next time on The Profit First for REI podcast with David Richter.

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