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How this power couple used Profit First to rebuild their business with Adam & Amanda New

Episode 152: How this power couple Adam and Amanda New, rebuilt their business  by taking a Proft First approach and become the principal owners of The Cash Offer Company

 

The Profit First REI Podcast

February 2, 2023

David Richter 

Summary:

 

Today on the Profit First for REI podcast, we’ve got twice the guests for twice the value! Adam and Amanda New are the principal owners of The Cash Offer Company, buying houses from motivated sellers in Richmond, Virginia, and helping them with a hassle-free process. 

 

Adam and Amanda had worked together in some form for a very long time before they decided to focus on their wholesaling business. They got off to a rocky start, almost going out of business several times until they rebuilt their business by taking a Proft First approach.

 

Catch the insights this power couple shares their story and the benefits of applying the Profit First method from day one of your business! Tune in to this episode! 

 

Key Takeaways:
[00:54] Introducing Adam and Amanda New

[02:04] Adam and Amanda’s Start in Real Estate

[10:00] Why Realtors Often Live Deal-to-Deal

[14:17] On Their Recent and Future Deals

[16:18] On Applying Profit First Into Their Business

[23:20] How They Managed After the Setback They Experienced

[25:24] Planning Around Your Taxes Through Profit First

[28:18] Adam and Amanda’s Future Ventures

[31:10] Adam and Amanda’s Advice for the Audience: Why Profit First is a Benefit for Your Business

[35:50] Connect With Adam and Amanda

 

Quotes:

[28:36] “I think we’ve built up a sizable enough war chest at this point, just kind of being unaware of where the economy is gonna go…We don’t like to spend a lot of mental energy predicting things…We’re just prepared, regardless of what direction it goes in. We’ve achieved the education that it doesn’t really matter which direction the market goes, and we’ll be prepared for that, too.”

[31:29] “We started [Profit First] from day one, and what it did is it created space and grace for us to recognize when we can be aggressive and when we need to be concerned. And it gave us so much confidence in what the next step needed to be, whether it was growth or maintain.”
[32:09] “[Profit First] has created firewalls. It has protected us, and it has given us all the confidence we need to know what the right decision is at the right time. And I don’t know what price tag you put on that.” 

 

TikTok: @newinvestors
Adam’s Instagram: https://www.instagram.com/theadamnew
Amanda’s Instagram: https://www.instagram.com/amandanew

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:



Adam:

<affirmative>. And so you were just David sitting next to me, <laugh> and I’m like, what do you doing?

David Richter:

Still just David

Adam:

Like this

Amanda New:

<laugh>.

Adam:

No, but you know, funny, you just, you sit down next to a person, you don’t know who they are. You don’t know their background, you don’t know what they’re a subject matter expert in. You don’t know what kinda value they’re gonna bring to your day, right?

David Richter:

Yeah.

Adam:

Um, and then you’re just like, I like this book Prophet First. And we’re like, okay.

David Richter:

<Laugh>

Adam:

And it was, you know, and then there you go. And so then it was like, so I think we read that. Learned about it.

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 Adam and Amanda New, which are two of my favorite people that on this, that I’ve met in the real estate investing world. They are also diehard Profit First fans because it has saved their business multiple times. They tell the stories of where they were in 2021, 2022, and how Profit First has come in and been a huge part of their business and has saved them from going out of business several times. And not only that, what some of the bonuses they’ve been able to do being on this since day one inside of their real estate investing business. And they’re only a few years into it. So if you’re just starting out, these are the habits that you want to create. Thank you for listening. So we have Adam and Amanda new, probably two of my favorite people that I have interacted with, uh, across the real estate investing world. Anytime I see them, they’re upbeat positive, which, unless they prove me wrong on this show, but I don’t think they will <laugh>. But Adam, Amanda, thank you so much for being here today. And doesn’t, if you’re watching, doesn’t Amanda’s hair look great?

Adam:

<laugh>

David Richter:

Because did her hair

Amanda New:

looks fantastic,

David Richter:

Right? Yeah. There you go. So thank you both for being here today.

Adam:

Thanks for having us.

Amanda New:

Thanks.

David Richter:

So these two are real estate investors. You and we talked a little bit before, two and a half years you’ve been in the real estate investing world.

Adam:

Yeah.

David Richter:

Can you tell you, tell a little bit of your journey. What were you doing before? Why real estate? You know, just tell, uh, I don’t know a few minutes here of giving that background and where you are now.

Adam:

Yeah. So the two of us were working corporate banking jobs, um, sales roles mostly. We worked together, um, for the same company. We don’t know how they ever let us do it. Um, and we went there for about eight years. I got laid off

Amanda New:

March of 2020.

Adam:

March of 2020.

David Richter:

Okay.

Adam:

Immediately found a new role within days making even way more money than that. So like everything was looking good, but this was like peak covid, like when everything was shutting down.

David Richter:

Yeah.

Adam:

So I was like, better paying job, I’ll take it. Um, very quickly realized like we were not the right culture fit. Um, we had our daughter in there too. Mm-hmm. And we were like, we need to spend more time with her and less time traveling for work. And so very quickly we were like, we need to stand up a business and make this happen quickly. So

David Richter:

That’s awesome.

Adam:

We worked really hard, really fast to make that happen.

Amanda New:

Yep.

David Richter:

Oh, very cool. And before I go further, I’m gonna here team, pause this and we’re gonna cut this out. If you see your screen going wonky, the recording on the other side is a lot smoother. So if that’s like messing you up or anything, it’s like the, cuz I know the video sometimes goes really crazy.

Amanda New:

Yours is going fuzzy, ours is not.

David Richter:

Okay. And like vice versa. So I just wanted to make sure that you’re good there and that doesn’t throw you off. But let’s jump back into it. 3, 2, 1. That’s an <laugh>. I love this because I get the inside scoop a little bit more cuz I remember Adam, you told me the story of like how much you were making and it was a significant amount. Like this was not your average American household income

Adam:

Yeah.

David Richter:

That they were able to bring in. And then you started a business a wholesaling business, right?

Amanda New:

Yes.

David Richter:

From scratch.

Adam:

That’s right.

David Richter:

So that’s right what you started with. Are you still wholesaling or are you flexing and flipping now? Like how has your journey progressed on the real estate investing side?

Amanda New:

So now at this point we still primarily wholesale. Um, because if you look at like what we are the best at, it’s obviously our sales background talking with sellers, kind of working through that process. So we stood up that business throughout the summer of 2020 and ended up quitting our job September of 2020, both of us. Um, which in hindsight was, uh, a really bad idea. It worked out fine for us,

Adam:

<laugh>

Amanda New:

I just wouldn’t recommend anybody else do that. Um, it just, we were, uh, very naive and every contract goes through and everything’s fine. So we, I had two things under contract and we said, okay, that’s good enough. And then just like mic drop and walked out. Um, now flash forward, um, we use our wholesaling business to basically cherry pick the properties we would like to keep for ourselves. Um, whether that means that we keep it as an Airbnb or a long-term rental, whether we keep it just to flip it. Um, we usually do some like light cosmetic flips, so maybe only like a couple a year and then the rest be wholesale. So that’s now kind of the evolution of where things have headed.

David Richter:

That’s pretty incredible. What is that like around six months? Like you had, you know, you got the job or a few months there and then started your own business and said, see you later to the other job. So

Adam:

Yeah.

Amanda New:

Yeah, yeah. It was, uh, it worked out fine. We were never destitute, nothing ever bad happened to us, but I just, I tell that story and I don’t want other people to be like, oh, so that’s what I should do. No.

David Richter:

Right.

Amanda New:

That’s not what you should do. <laugh>,

David Richter:

Let me ask this. Okay, go ahead Adam. Well

Adam:

I’ll say it’s one of those things I think we gave ourselves on a runway.

Amanda New:

Yeah.

David Richter:

Okay.

Adam:

You know, we saved up enough at that point and then we got to a point where she was maybe putting like eight to 10 hours into the business and working a full-time job and then was just like, I can get this much accomplished in eight. Imagine what I could do if this was my sole focus.

David Richter:

Mm-hmm. <affirmative>

Adam:

And I believe in her. So I said, I believe in you and then let’s go do this.

David Richter:

Yeah.

Adam:

Right. So that is a risk, but I was still working at that point, which then made even more money because she was able to focus her time and attention exclusively on the business. And that was very profitable. So it was like, okay, well if your efforts equal X, what happens when the both of us are doing this? Unless they’re like, and then at that same exact time. And then I call it like, one of the cutest things a couple could ever do is just look at each other and say, well, I believe in you too. So

David Richter:

<laugh>

Adam:

<laugh> next thing.

David Richter:

You guys are so amazing. I love this.

Adam:

Yeah, exactly. And listen this not every day’s like that, but like, those were two really good days.

David Richter:

<laugh>

Adam:

Two the Beaver. They’re like, oh,

Amanda New:

I love

David Richter:

The Beaver fan. They’ll leave it Beaver

Amanda New:

there you go,

David Richter:

Like it. Right. This is great. But no, honestly, all kidding aside, that’s incredible because a lot of people go down that rabbit hole and it’s usually one or the other. The one of the spouse is the wife or the husband saying, we’re gonna do this. And the other one’s like, oh my gosh. You know, like, how are we going to do this? But it sounds like your values have been aligned for Alonda. Like you found the right person that’s really going to stick behind you no matter what. And you know, you both jumped into a job that you could both do in a business that you could both start, you know, and work on together. So would you say that’s been, you know, like you said, there’s never perfect days, but were those some of the contributing factors? Cuz I feel like that happened quickly. We went from job to like, yeah, there was transition and runway, but it was a pretty, you know, relatively quick time going from job to no job and business.

Amanda New:

Yeah.I think a couple things happened that, uh, helped us get lined up.

David Richter:

Yeah.

Amanda New:

We were gained the same education. So it wasn’t like he was doing all this education then coming to me and saying, babe, we gotta do this. And I’m going, you’re a psycho. Like, no, we’re not doing that

David Richter:

<laugh>

Amanda New:

We were aligned in what we were learning and we were aligned on the vision for what, not just we wanted, but what we wanted for our family. What style of life did we want by design? And what did we want to pass to our next generation? So if you were aligned on those things and you have those conversations, which we’re really, this is something actually has been coming up a lot recently in our sphere of influence

David Richter:

mm-hmm. <affirmative>,

Amanda New:

This is something that’s really important and most people don’t talk about, they just get so bogged down in the day-to-day life, they can’t really think about what they want their life to look like five to 10 years from now. Um, and that was all we talked about. So it’s like we were aligned on our education, we were aligned on our mission, we were aligned on what the vision needed to be

Adam:

mm-hmm. <affirmative>.

Amanda New:

So it, as long as the decisions we were making, whether I was making him or he was making them lined up with that, it made perfect sense. And that’s kind of why it moved so quickly.

David Richter:

Where would you say you picked that up from? Was that inherent to you? Or was that from the education you were getting together? Or like how did you know to kind of go down that road and you were making like that? Because like you said, I don’t feel like a lot of people have that framework when they make those decisions, especially big life decisions.

Adam:

We’d worked together like in the corporate world for eight years prior to that. So our entire married life, we’ve worked together in some capacity.

David Richter:

Okay.

Adam:

I mean, it genuinely was as crazy as like, I got a job right after we got married and my boss said, I love your energy. We need to hire someone else that’s just like you. And I kind of sarcastically said like, well, you could always hire my wife. And they said, do you think we could get her on the phone

David Richter:

<laugh>

Adam:

Like that like,

David Richter:

<laugh>

Adam:

That was it. So like, you know, some of it’s happenstance Right. Some of it’s just like, you know, right place, right time.

David Richter:

Yeah.

Adam:

Um, and you’re blessed in that regard. Um, but I also think too, like being in that environment and really saying, okay, if we’re working for the same company and we’re in similar careers, like where are you going? Where am I? We were always kind of headed in the same direction. So it wasn’t like she was an ER nurse and I was an airline pilot.

David Richter:

Right.

Adam:

So we were always just kind of headed in the same general direction. And even then, like education, we’d always had a lot of sales training. We’d always had a lot of manager

Amanda New:

leadership training

Adam:

And leadership training.

David Richter:

Yeah.

Adam:

So we just kept heading in that direction.

Amanda New:

Mm-hmm. <affirmative>.

David Richter:

I know. That’s really good stuff and I’m glad that you’re saying it on this podcast as well, because one of the things about, you know, profit First that we’re even teaching now, number one is people don’t know what they need just to support their lifestyle or like, don’t know the foundation of that. And a lot of people don’t have any plan, which it sounds like you were talking about there too. Like, they don’t know five, 10 years from now, they don’t know a year from now, so

Amanda New:

mm-hmm. <affirmative>,

David Richter:

Why would you say a lot of people in the real estate space live like that? Or they’re living deal to deal, you know, like they go from a W2 job where they might have been a living paycheck to paycheck, but now they took the leap outta they’re not Adam and Amanda where you know, like, hey, this worked out. Where are this, uh, you know, aligned. But now it’s like, what the heck did I get into? Why do you think a lot of people go down that road?

Amanda New:

I got two.

Adam:

How much time

You guys <laugh>?

David Richter:

<laugh>

Amanda New:

Okay, So it’s two reasons. And, and my humble opinion, one is shiny object syndrome.

David Richter:

Okay?

Amanda New:

All their education came from YouTube. And on YouTube, every video is the same. X, y, Z methodology is the best way to do it. And all the other ways are dumb. And you gotta listen to me NPS by my course. So there’s no focus on what is the goal of the business in terms of what is it going to do. You

David Richter:

yeah

Amanda New:

Cannot jump in and start a business and wholesale flip substitute this, that you can’t do all of it. You have

David Richter:

right

Amanda New:

To get so focused and master the art of whatever it is you feel passionate about doing. And then the other thing that I think happens is you get shiny object syndrome in your life.

David Richter:

Mm-hmm. <affirmative>.

Amanda New:

Um, you get, you know, you see your friends buying bigger houses, nicer cars, and so you kind of wanna keep up with that. Um, and that plays a really big part in, in how you spend your money and how you spend your mental energy. Um, and that’s tricky. And then the biggest thing, one other, sorry. There is a third thing. The biggest thing that we ever noticed. So we used to sell credit card processing for the bank. And consistently the theme we found is that a lot of times small business owners are experts in their craft, but that means absolutely nothing. And they’re not an expert in running a business. They’re great at making a taco, they’re perfect at working on cars, but that doesn’t mean they understand how businesses get run. They’re an expert in their craft.

David Richter:

Yeah.

Amanda New:

And you, if you are going to be independent and not working for somebody else, that is a skill set that most people think just kind of happens. Like you make enough money and it all works out.

David Richter:

Mm-hmm. <affirmative>.

Amanda New:

And that is not accurate as you can prove with thousands of case studies in your own personal business. <laugh>.

David Richter:

Yes. Very much so. No, but I love hearing it from you because I think, I love how you said shiny object for business and life, because I liked how you explained it too, because it’s very much you go down the rabbit trail of YouTube or a lot of the education and then it’s like, yeah, I wanna do 15 different things and you know, like I have 15 different coaches and they’re all telling me different things to do, then the life as well. I thought that was great with the cars, the lifestyle. Like obviously you’re gonna, and I think it, I would you agree with this, when you get into real estate and you can start making more money, you can almost see more of the dangerous side because you see some of those people that have bought into the lifestyle or you are

Adam:

mm-hmm. <affirmative>

David Richter:

Exposed to it more. Would you say that it’s even easier on the shiny object life once you get into your own business and that part?

Amanda New:

Well, you get to see people that are further along in their career, their real estate career than you, and they get

David Richter:

yeah

Amanda New:

To do these big things and they get to go on these amazing trips and you feel like because you’re doing the same thing, you should be able to do the same thing. And it’s like, no, they have 10 years of a portfolio developed, or 10 years of a flipping business developed. Like

David Richter:

yeah,

Amanda New:

They should be in a different place than you. Like you’re still scrappy. Like we are still very much in our scrappy mode. We are not in a big 80 person business mode. Like

David Richter:

right

Amanda New:

They’re just different things. Um, so they require different levels of attention and money, you know, personally.

David Richter:

Yeah. That’s so great. And then I did all of your third point about expert in the craft, not the business. You know, like they’re good at making the pies but bad at selling them. Exactly. So it’s like making sure that you know, that you can, uh, run the actual business, which we’ll talk about more. It’s the profit for star AI show. We’ll make sure that we cover that

Amanda New:

<laugh>.

David Richter:

But I also wanted to cover just a little bit more about your business as well. You say you’re in scrappy mode, you know, now still, is that because you’re just trying to, are you still in the, like, I still need to bring in the active properties, like where I sell properties or like have you started a portfolio? You didn’t mentioned that some of your exit strategies are like short-term or maybe long-term rentals, but how many deals have you done in the last few years? Or like, what are you on track to do?

Adam:

Oh gosh.

David Richter:

For 2022.

Adam:

So I, yeah. So I think I said we’re pretty much sitting at, I think somewhere around 75, 80 deals.

David Richter:

Yeah.

Adam:

Like total. Total.

Amanda New:

Yeah.

Adam:

Um, we’ve taken down multiple Airbnbs, we’ve taken down multiple long-term rentals at this point. Um, and we continue to do that. Some of them through things like sub two, some of

David Richter:

yeah

Adam:

Them just through traditional purchase methods. Um, we’ve along the way just met a lot of good lenders and private money and just, you know, solved a lot of the problems that allowed us to continue to fund, you know, continuing acquisitions. Um, and we’ve made a lot of the mistakes along the way, but because we ran our business correctly from a money standpoint, none of those were ever business enders. They were always like, well, that was an interesting lesson to learn.

David Richter:

Yeah.

Adam:

Um, and so I think that’s kind of one of the reasons why we’ve always been drawn to you is that from day one, we had that education of, okay, this is how you run the business in such a way that you’re not gonna run into some of the traditional pitfalls that business owners have. And so, like, we just, we have always felt blessed that from the get-go, like we’ve had that, and I know plenty of other people that are far wealthier than we are that didn’t learn that until year 15.

David Richter:

Right.

Adam:

<laugh>

David Richter:

Yeah. That’s the sad part of, so, you know, a lot of people that work there rear off and then they, you know, make the decisions that might cost them time or something. And then it’s like, what, why’d you do this for the last 12 years like this? And now, you know, now it’s to a better place. But let’s talk about that. Speaking of Amanda’s third point there, the expert in the craft versus the business. And then you just mentioned having the financial grasp, well, better and being able to handle the mistakes more. Did you have the profit first mentality going into the business? Or like, when did you pick up on, you know, profit first in that whole methodology, that mindset?

Amanda New:

Probably a year and a half before the business ever started.

David Richter:

Oh, wow.

Adam:

Yes, because if i think about the timeline, um, before we’d ever even started the business, I was sitting next to you at Jimmy, one of Jim Ingers salsa events.

David Richter:

Yeah.

Adam:

And so you were just, David sitting next to me <laugh>, and I’m like, what do you do

David Richter:

just David

Adam:

like this

Amanda New:

<laugh>?

Adam:

<laugh> No, but you know, it’s funny. You just, you sit down next to a person, you don’t know who they are,

Amanda New:

yeah

Adam:

you don’t know their background, you don’t know what they’re subject matter expert in. You don’t know what kinda value they’re gonna bring to your day. Right. Um, and then you’re just like, I like this book Prophet First. And we’re like, okay, <laugh>.

David Richter:

<laugh>

Adam:

And it was, you know, and then there you go. And so then it was like, so I think we read that, learned about it. I think we, you and I hopped on a call like before I was even starting the business, like,

David Richter:

yeah,

Adam:

Is there anything that you think that we need to know before we even attempt this? And you were just, at the time, and rightfully so, you’re just kind of like, I don’t know, maybe I’d do a deal or two first just to kind of see if you like the business

Amanda New:

<laugh>

Adam:

Before you really kind of commit to this thing. And I was like, okay, cool. And then I came back, you know, how many months later and was like, all right, I’ve done some deals now. You know what now? And you’re like, okay, well then what have you done? Okay, well then I Yeah, you’re good. So let’s, you need a bookkeeper, gimme a call. <laugh>.

David Richter:

<laugh> That’s great.

Adam:

So yeah.

David Richter:

Oh man, I remember that man. Because when you have that knowledge and like when people know you could bring the value, then they’re reaching out to you and it’s like, okay, they’re gonna do the deal. Okay, sure. But then you at that time you’re just Adam and Amanda.

Adam:

Yeah.

David Richter:

You know of like, okay.

Adam:

Exactly.

David Richter:

Are they gonna be the other people, the thousand other people that reach out and say, oh, should we do this? And it’s like, well let’s see if you actually do it first. And then, that’s what I love about this. If you’re listening to this, you have to take action. Like you heard Adam say that they’ve made mistakes and you’ve heard Amanda say they’ve gone through certain things and it’s like you just have to go through those things. Like even if you read the books, you go to these conferences, you’re still gonna have those things come up. But I guess talk about how did <laugh> some of those mistakes hurt less since you had the profit first mentality and system in place?

Amanda New:

So I can tell you exact, I can give you our biggest mistake, um, and exactly how we dug ourselves out of it. <laugh>. So,

David Richter:

okay.

Amanda New:

Um, so at the end of last year, so end of 2021, um, cuz that’s actually now not last year, uh, end of 2021, uh, we got real excited about, uh, we figured out the private money piece and we figured out

David Richter:

yeah.

Amanda New:

That we could actually put mortgages on properties through D S C R lending cuz we had to quit our jobs. So we didn’t think that we qualified.

David Richter:

Okay.

Amanda New:

And then we had figured out we did, um, cause we had great credit, but you know, you just, you didn’t know about DS C R loans. So we figured out those two pieces and we’re like, we’re gonna build ourselves a portfolio, let’s go. And we <laugh>, we bought seven properties in a quarter.

David Richter:

Okay.

Amanda New:

Properties that normally we would’ve intended to wholesale

David Richter:

mm-hmm. <affirmative>.

Amanda New:

Um, and we just kept them. So that was fine because when we had bought them, we basically had borrowed money at 75% L T V Refied at 75% L T V and enough our rehab budget was less than that gap. Then we got to keep what was left over.

David Richter:

Yeah.

Amanda New:

Sweet. Well what we did not calculate is that there’s tax titles and fees to everything you do. Budgets always run over and what we got to keep was less than what we would initially usually get if we had to wholesale that same property.

David Richter:

Okay.

Amanda New:

Okay. So that means between, uh, less money coming in because you’re rehabbing all this stuff. And then simultaneously we had a marketing channel that I wasn’t paying close enough attention to that blew through $15,000 in cash in 45 days <laugh>, where normally I’d pay like five.

David Richter:

Yeah.

Amanda New:

We had gone through almost six figures worth of lost revenue.

David Richter:

Oh Wow.

Amanda New:

Um, in 90 days <laugh>.

David Richter:

Wow.

Amanda New:

Oops. <laugh>.

David Richter:

Yeah.

Amanda New:

Um, big oops. But here’s what happened is, and here’s why Profit First helped, I realized that, you know, what was going to hit the fan about 60 days before it did.

David Richter:

Okay.

Amanda New:

Because I have all the money in the different accounts. I could see how much we were spending and I could see the operating budget account going smaller and smaller. And I could really tell you to the day when we were gonna run outta money,

David Richter:

huh.

Amanda New:

To the day. Cuz I can tell you when we pay our bills, I can tell you when’s gonna happen. So on the one hand you’re like, oh my God, that’s terrifying. On the other hand, what that meant was that we had more time to undo the mistake we made.

David Richter:

Okay.

Amanda New:

So we could cut off that marketing channel, we could start getting a little scrappier and doing more of like manual labor to find more opportunities to wholesale. Like we could do different things to kind of dig ourselves out. Um, because we had time where it wasn’t like we got to that 90th day and said, uh, we’re done. Yeah.

David Richter:

Right.

Amanda New:

Um, so does that mean that it was all great? No. Um, it took us months to undo what we had done <laugh> and we’ve learned a very valuable lesson along the way.

Adam:

Sure. Yeah.

Amanda New:

Um, but it was not a business ender because I knew what was happening about 90 days before it happened.

David Richter:

Huh. That’s, uh, that’s pretty incredible. I’m not that you went through that, but that you were able to back yourself out of it. You know, like of course it’s one of those things where it’s like once you go through it, then now you have the experience and it’s not like you could have read that in a book or whatever. It’s like this is

Adam:

yeah

David Richter:

the situation that was presented before you type thing.

Adam:

So we genuinely thought we were gonna have almost an unlimited runway to just keep acquiring and

David Richter:

mmm-hmm <affirmative>

Adam:

Had everything gone according to our original calculations. That would’ve been true.

David Richter:

yeah

Adam:

But you know, the, what we found is that as the market, as the markets has made adjustments, mostly that’s with the CR lenders and so we just continued being like, okay, so we know we can only do this much.

David Richter:

Yeah.

Adam:

Like it’s gonna hurt for a little while. It’s not gonna ruin things. So we were continue to make money, we were able to continue to pay ourselves. We were con you know, so we were still able to do all the things that function as a business. We just were like, okay, we just can’t spend any more money acquiring right now. So effectively that was our punishment. You can’t buy any more houses for the next three months. No.

Amanda New:

And Ruth freaking who we got a portfolio of we have a portfolio now that we didn’t have.

David Richter:

Yeah.

Amanda New:

14 months ago. Yeah.

David Richter:

Huh. That is so interesting cuz I love what you said. You were still able to pay yourself, still able to do those other things and the only punishment now was I can’t buy more properties. But the other one is going outta business or you know, realizing on day 90 <laugh>, oh shoot, what the heck? You know, there

Adam:

yeah

David Richter:

Did all the money go, which I’ve heard so many times just like I a call yesterday, you know, like I made $357,000 that my net profit says, but I have like $10 in my bank account.

Adam:

Where did it all go?

David Richter:

You know? Exactly

Amanda New:

yeah

David Richter:

So it’s like we hear this all the time in the real estate space. So then my question is, since you got, you have that process in place with Profit first, I guess going through the rest of the year and with the market changes and everything, were you still able to, even with market changes and everything and you know, going through that process there, did you still acquire properties? Did you still pay yourself the rest of the year? Like were you still okay like with

Adam:

Yeah.

David Richter:

You know, the business after that setback of not being able to acquire more during that time?

Adam:

Yeah.

Amanda New:

Yeah. So we didn’t, we did not end up acquiring anything last year. Um, but it’s funny cuz now we’re about to acquire like two or three in the next 30 days that were like leads that kind of bubbled up. Yeah. Um, but the actually the big win, um, and I hadn’t even got a chance to tell you this David, so you know, a percentage of your business is go source taxes.

Adam:

Yeah.

Amanda New:

And every single quarter I paid our estimated quarterly taxes, like per our CPA’s recommendation.

David Richter:

Yeah.

Amanda New:

And per our income now somewhat made up because we didn’t really have a full year of business to figure out what the quarterly taxes needed to be.

David Richter:

Yeah.

Amanda New:

But you know, we paid it out. Okay. And then we had this like war chest sitting there cuz at the end of the year I was like, are we gonna owe something or are we gonna refund? I got no idea.

Adam:

Right.

Amanda New:

Like cuz we just hadn’t done this before.

David Richter:

Yeah.

Amanda New:

Between the refund we ended up getting, because we had overpaid and the money I could now take out of that tax account because, I didn’t need this big old war chest. We actually at the end of last year, um, end up getting almost six figures worth of income that we got to just do whatever we wanted to do with

David Richter:

Nice,

Amanda New:

Um,

David Richter:

oh man.

Amanda New:

As a result of us being super conservative.

David Richter:

Yeah.

Amanda New:

And like, just doing what I was supposed to do. But because we had so many deductions and because we had this war chest, we could now just redeploy it to whatever we wanted to do with it.

David Richter:

So let me ask this cuz that is a huge win and like being able to not have the stress of not paying the taxes and then number two, like having the extra money, like that would be an insane relief for most real estate investors. I wanna play devil’s advocate for some of the people that don’t like Profit First or maybe, you know, like they’re still on the, what you said, they’re expert in their craft but not the business. So they don’t under, they might not understand what they might ask. Did you lose opportunities by not having access to that money in that tax account? Were you or did you ever think like, like I would rather be using that money or not. Cuz I know because

Amanda New:

It was money that was hiding. Not hiding, but it was money

David Richter:

okay, yeah

Amanda New:

That like outta sight outta mind. Like it just wasn’t a part of a budget until it came to quarterly tax time and I wrote a check out of it.

Adam:

Mm-hmm.

Amanda New:

So like, you don’t plan your business around that money. That money doesn’t exist.

David Richter:

Yeah. Awesome.

Adam:

And I can fundamentally see where someone begins that argument. Right. You know, what would an extra a hundred thousand dollars in your checking account due for your business? Well, for a lot of people it’s what would keep them in business. Right. But at the end of the day, like it goes back to would you rather it be an exercise and maybe I just bought a little bit less <laugh>, maybe I did

David Richter:

Right.

Adam:

Maybe I did one less acquisition. You know, like, would you rather have that or would you have rather have the potential for the tax man to come and then all of a sudden you realize we don’t have a business anymore, yeah.

David Richter:

Yeah man, that’s really good because so many people get into that situation cause they hear,

Adam:

yeah,

David Richter:

They had a hundred thousand, I could have spent a hundred thousand more. And then it’s like, wait a second. Like they were able to do what they wanted with that a hundred thousand. You know, it’s not just going back to feed the machine and the monster. So that’s,

Adam:

You were also talking about a delay of what months. I mean, we’re just talking about months.

David Richter:

yeah

Adam:

It’s like, be patient a couple more months and then know for sure that’s fun money.

David Richter:

Right. And if you’re listening to this now, Adam and Amanda are displaying true wealth. True wealth is not spending every dollar that you make

Adam:

<laugh>

David Richter:

It’s not doing that. So this one gave them peace of mind during tax time and like an added bonus because when is it, I don’t know if you talk to a lot of real estate investors like I do, but you probably do being in the real estate investing world, when did they ever tell you got a big bonus or like something great like that happened?

Amanda New:

Never.

David Richter:

It’s usually the war stories, right? It’s the horror stories. It’s the story you told at the beginning, but without a happy ending.

Adam:

yeah

David Richter:

It was more like I had to go out and get a loan from my second cousin’s wife’s brother, you know, just because to keep me a float during this time or whatever. So that’s where, oh man, that’s, that’s good stuff. If you’re listening to this, can you open one account? Well open one account, call it taxes. If that’s all, if that’s the big thing that’s a headache or profit or paying yourself. Because I love what you said too. You said you were able to pay yourself during the, during the hard time of that the biggest mistake that you’ve made so far still we’re able to run the business like a business on the financial end and just, and had the wherewithal 60 days in advance to know like, hey, this is going to be an issue. We need,

Amanda New:

yeah<laugh>

David Richter:

To adjust something. So No, that’s great stuff. So then now with the business continue to grow and continue to keep going, what are some of the things that you are investing in for the future? Like, are you going after, you know, like the different types of properties? Sounds like you are buying more rentals

Adam:

mm-hmm. <affirmative>

David Richter:

And long term. So like, what is the plan for the new family, you know, into 2023?

Adam:

I mean, we’re continuing to acquire, you know, I think we’ve built up a sizable enough war chest at this point, just kind of being unaware of where the economy is gonna go, right?

David Richter:

Yeah.

Adam:

We don’t like to spend a lot of mental energy predicting things. Uh, we’re just, we’re we’re just prepared re regardless of what direction it goes in, um, we’ve achieved the education that it doesn’t really matter which direction the market goes in. We’ll be prepared for that too. And that’s really it. We’ll just continue to acquire, we’ll continue to grow the business. Um, we’re putting the people and the processes in place to, you know, expand significantly in 2023. Um, so we’re excited about everything that brings, we’re expanding our family, we’re expanding our business. And so yeah. I mean, we’re ready for

Amanda New:

<laugh>.

David Richter:

Yes. And congratulations. They are expecting their second child in July, which is very exciting. So congratulations to both of you. And I can’t, the the words that you just said there, I can’t tell you how much that good that does my heart. That you know what the plan is that if all the other plans fail, we’ll still be okay. <laugh>.

Adam:

<laugh>

David Richter:

You know, it’s like that’s

Adam:

yeah

David Richter:

What you really want to get to in business. And if you’ve ever read the book great By Choice, by Jim Collins, like a great book. And I, Adam and Amanda are displaying that book right now because they talk about productive paranoia of making sure you have cash. So that way, whatever the market does. So I absolutely love what you guys are doing. I think you’re a, a great model for business owners, not just real estate investors, but business owners to look at, to say, here’s the first few years, here’s the setbacks that we’ve had. Here’s the wins that we’ve had. But then during this time, we were able to pay ourselves, we were able to still do this, look at what we were able to do with the tax money at the end of this year. So this is a couple you need to be watching and following. Also, I see Adam interact more on Facebook and all his stuff is hilarious. Like he’s just got the dry, witty, sarcastic humor,

Amanda New:

<laugh>

David Richter:

And I like every time see his stuff and just crack up. But that’s where you gotta follow both of them. I know they’re gonna tell at the end how you can get ahold of ’em, all that good stuff, but search these people out. These are good people to be able to model after with what you’re hearing here. They’ve gone through difficult times, but you’re going to do that too. But they’ve gotten through them because of good business practices and being on the same page, what they shared at the beginning, man, I can’t <laugh> express that enough. Same education, alignment with family, you know, the mission and the values. Like those are the decisions they’re making together. Man, this has been incredible. And I just have a couple last questions. And so going through all of that ton of knowledge, what would be some last minute advice here that you would give to the real estate investors listening to this podcast?

Amanda New:

I would say, so what Profit First has done for us, if you really just, all the stuff that was been swirling around for the past 30 minutes, we started it from day one and it, what it did is it created space and grace for us to recognize when we can be aggressive and when we need to be conservative. And it gave us so much confidence in what the next step needed to be, whether it was growth or maintain, because you can literally look at the bank account and say, this is what has to be done next.

David Richter:

Hmm.

Amanda New:

I could tell you, I just knew. So like right now we’re sitting in a much better position than we were this time last year. That’s why I can sit here and say, with utmost confidence, it’s time to scale. Um, it has created firewalls, it has protected us, and it has given us all the confidence we need to know what the right decision is.

Adam:

Mm-hmm. <affirmative>

Amanda New:

At the right time.

Adam:

Yeah

Amanda New:

Um, and you can’t, I don’t know what price tag you put on that. Like, people

Adam:

yeah

Amanda New:

Are always wandering around saying like, I don’t know what I wanna do. I don’t know what I wanna do. My bank account tells me what I can do.

David Richter:

Yeah.

Amanda New:

If my bank account had $5 in it, which it doesn’t, um, let’s be clear.

David Richter:

Yeah.<laugh>

Amanda New:

Um, if my bank account has $5, I can’t go buy a mentorship program that’s five grand.

David Richter:

Right.

Amanda New:

If my bank account has a hundred thousand dollars in it, I can go buy something.

David Richter:

Yeah.

Amanda New:

Whether it’s a property, whether it’s a mentorship, or whether it’s buying employees like you’re scaling. So the decisions become very clear if you know where you’re at and it protects you and gives you a lot of confidence that you’re making the right choice one way or another.

David Richter:

I need to bring Adam and Amanda everywhere I go.

Amanda New:

You Really Do

Adam:

We tell you where Evangel evangelists, I mean, that’s

Amanda New:

All. Have you seen how many times you’ve gotten tagged on TikTok? Like I’ve at least made three videos that you’ve been referenced in.

David Richter:

Yeah

Amanda New:

Absolutely.

David Richter:

Oh!, thank you. No, I’m not even on TikTok. I need to.

Adam:

Well, you’re on TikTok. We’re just talking about, we’re talking about <laugh>.

Amanda New:

<laugh>

David Richter:

<laugh>

I am hopefully

Amanda New:

Behind you get at least a hundred followers just from us.

Adam:

Yeah,

David Richter:

Right. No kidding. But now we

Adam:

Have a lot of conversations with investors in meetings and in person and on the phone and whatever, and there’s a lot of nervous energy out there.

David Richter:

Oh yeah.

Adam:

And just for our personal are really more so me. Yeah. My nervous energy is better put to use in a profit first environment because

David Richter:

Hmm.

Adam:

That’s not the piece I’m worried about.

David Richter:

Right. Yeah.

Adam:

So we can focus on the things that make us profitable and then the rest of our life instead of having to worry about money constantly. And I think when people set themselves up with their bank accounts and with their finances in such a way that it’s just kind of up and down, up and down, up and down, yeah. That’s where their mental energy is going.

David Richter:

Yeah.

Adam:

And I just, I hate seeing talented people spend all of their time and energy focused on how they’re gonna pay payroll this Friday and not on doing what they were put on this earth to do.

David Richter:

Right. Man, that’s really good. That is really good. And I agree with you, a lot of nervous energy out there, but the people that are coming on this podcast, a lot of ’em have the same theme of Yeah, you know, where we are now, it’s time to scale <laugh>. It’s like, and where the nervous energy is for other people, it’s like, well, this is no, this is where we are and what we can see, or we know where we stand. So I appreciate that. That’s awesome. I think that is, honestly, I’m biased for sure being on the Pro for Star I podcast here,

Adam:

but

David Richter:

<laugh>

Adam:

But i think that’s great advice if you want to end up like Adam and Amanda here, where they’re not worried about the market, you know, what they’re worried about. Like they’re worried about like, where do we put the money to make sure

yeah

David Richter:

That it’s most effective for us and our families? So that’s the, I’d rather have that issue than, like you said, payroll’s Friday. Oh shoot. You know, like that’s,

Adam:

yeah,

David Richter:

It happens again. So that’s where, uh, that’s good advice. I really appreciate that. Now you’ve given a lot of way here. Like I said, I went through that list. I mean, you can get three, if you listen to the beginning of this podcast, go back again. Listen to, especially if you’re a husband, wife team or if you’re a, you know, you’ve got your spouse on board or if they’re not on board, there were some of those steps there that they took together, you know, exactly. Like this can help them. But then also at the end there too, just talking through their whole profit first journey and then how it helped them in the hard times as well. But since you’ve provided a ton of value here, how can they provide value back to you and what are you working on or how to connect with you or whatever it is that you’re looking for at this time?

Adam:

Yeah, we love connecting with folks. So TikTok is probably the easiest way to connect with us and just kind of see what’s going on on any given day. Um, so we’re on Tiktok@newinvestors.

Amanda New:

Mm-hmm. <affirmative>,

Adam:

um, so we’re gonna make a punt on that one. Um, <laugh> and then just from there, Instagram, I think, you know, I’m on Instagram, Amanda’s on Instagram, so I’m at the Adam New, she’s at, uh,

Amanda New:

@AmandaAnew. You’re just gonna see, I’ll be honest with you on Instagram, you’re gonna see a lot more like really cute pictures of our daughter and like me throwing weight around because I decided CrossFit’s a good idea.

Adam:

Yes.

Amanda New:

Um, so it might not be quite like the real estate, hard hitting content you were hoping for. Um, TikTok is where you’re gonna see a lot more of the real estate stuff if you just wanna make sure that like we’re doing okay. Then come all along with us on Instagram, <laugh>.

David Richter:

<laugh>There you go. See the real side as well too. The real estate and the real side.

Amanda New:

yeah

David Richter:

So that’s right. You get all the aspects there. But that’s great. Make sure to follow them on Instagram. Like I said, TikTok, I mean Adam stuff. I see his stuff more and you know, like he’s got the dry humor. I see you on Facebook. That’s where I see you cuz I still circle around. Uh,

Adam:

I’m giving people a hard time

David Richter:

<laugh>.

Amanda New:

<laugh>

David Richter:

Yeah, exactly. Yes he does. But there you go. Adam, Amanda, thank you so much for being here today. This was an incredible interview and I believe that you’ve inspired a lot of people. I think giving people a lot of hope to because it’s like, hey, they started small and then now they’ve grown to where they are now with and made sure that the, that the financial systems were there for them and working for them. So if you are like Adam and Amanda and you’re like, I don’t want to worry about my cash ever again and I’m stuck, maybe you aren’t like Adam and Amanda now and you’re stuck in the cesspool of like, oh my gosh, you know, like, I’m just spinning my wheels living deal to deal. You can head over to simplecfo, see if we’re a good fit at simplecfo.com. You can schedule a call. If we’re not the right fit, we’ll pin you to someone else. But we just want you to have the freedom that Adam and Amanda have. That’s literally our mission, is to help you have that freedom so that way you don’t have to be worried about the money all the time. So remember, make profit a habit in your business. Adam, Amanda, thank you so much for being here today.

Amanda New:

Thanks.

Adam:

Thanks for having us.

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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implementing Profit First...

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Title: “Realize Your REI Potential with Jennifer Steward: Authenticity, Profitability, and Consistency”



Episode: 240

In this episode of Profit First for REI podcast, we are sitting down with Jennifer Steward of REI Data Source, to unveil the secret weapon you’ve been missing: authenticity. 


Jen will crack the code on how to project a winning image that seals the deal…But wait, there’s more! Learn the top revenue activities every entrepreneur should master and discover the power of consistent strategies to solve your REI problems.


This episode is your blueprint to a thriving virtual business. Don’t miss out!


Key Takeaways:


[0:50] Introducing Jennifer Steward

[6:07] Project an image of success from

time to time

[9:16] Some best revenue activities that every entrepreneur should know

[11:00] Leveraging every avenue that you can, get consistency, and make sure you’re solving current problems

[17:43] The golden ratio in social media marketing is: 90% business and 10% personal

[25:02] The benefits of running a virtual business


Quotes:

[4:20] “Authenticity is like a business repellant.”

[10:09]  “In a market where you can’t dind deals but there’s plenty of money, you have to be the person who knows how to find the deals.” 

Connect with Jennifer:

REI Data Source Website: https://www.reidatasource.net 

Jen’s Email: jen@reidatasource.net 

Phone Number: (469) 952-8011



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):

You need to just be able to solve the seller’s problem and just start with one exit strategy that you’re really confident in. And then once you master that, expand from there. And like you and I talked about, it’s who not how you don’t have time. Most likely to master all of those. So have a referral partner that you can build a relationship with and trust.

Speaker 2 (00:23):

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.

Speaker 3 (00:50):

Today we have Jennifer Stewart on which she is a go-getter. She’s out there, she’s doing lots of things. She’s in the cold calling space. She’s also a real estate investor. But then she’s also someone who I think has gone through a lot in her life and has come out on the other side stronger. And you can tell just from what she talks about and what she sees as the most successful real estate investors, what they do on a daily basis, on a monthly basis, it’s just good bottom line stuff to help you if you want to become someone who’s consistent in business, no matter what the market is doing. So I think this is going to be a really good episode. She gets into the nitty gritty and also just helping you get to where you want to be and making more money as a entrepreneur. Jennifer, welcome to the Profit First REI podcast. I’m so excited you’re here today.

Speaker 1 (01:37):

David, thank you so much for having me. I’ve been looking forward to this all weekend. What a great way to spend a Tuesday at noon and thank you. Thank you so much for having me today.

Speaker 3 (01:47):

Yeah, well I’m excited because we dance around in these different groups and we’re going to these events and you’re speaking a lot, you’re helping a lot of people out there, and I see you as someone who’s just very much, I hope this comes across, but just a very mature human being that has gone through a lot, but you haven’t just been a victim. You’ve been someone who said, I’m going to grow from what I’ve gone through, and that’s what I’ve just observed. And then honestly, there’s lots of my friends that respect you a lot too. I’ve gotten to know you well, so I’m excited about this one. So many things that I feel like we could go down, lots of roads here. So again, thank you for being on the show.

Speaker 1 (02:25):

I appreciate that. That’s very generous and kind observation. I think mature is a very polite word and I am just kind of overwhelmed with that kind assessment.

Speaker 3 (02:37):

Yeah, well, I don’t want to use any rude words for you here today, so we’re going to dive into it. No, but seriously I do. I see as someone who takes a lot of those lessons and applies them right away. I would also say too that you are not scared about sharing what you’ve learned and what you’ve gone through. Where do you get that deep sense of truth to share exactly what’s going on? And I don’t know if you’re a fan of the office or if you’ve ever seen that show. I like the Office, if you like the office. Where is it? I think it’s Kelly’s, Dayton, Daryl, and she says, he said, who says exactly what they’re thinking? What kind of game is that? And I’m like, that is Jennifer to a t. And I’m just wondering how did you get that as part of you? Because I think it’s so genuine, authentic, and it brings more people to you and they resonate. You’re saying what they’re scared to say.

Speaker 1 (03:30):

My business advisors have told me to do the opposite. They said

Speaker 3 (03:36):

Genuine, sorry. That’s great. Basically the

Speaker 1 (03:38):

More money you’re going to make, you have to play the game. And so what I’ll do, David being totally transparent, is I’ll turn that on and off depending on my revenue. So I know that sounds hilarious probably, but if my revenue gets lower, I will turn off the authenticity to a certain extent and go back into my polite game, the system mode. But whenever income is plentiful, I’ll go back to being more my authentic sharing self because number one, sometimes I get more business than I can possibly ever take down, and that’s overwhelming. And so I find that authenticity is like a business repellent, but it’s so much, it’s so stressful for me to be fake. It’s so stressful for me to be something I’m not. And that’s me being a little bit funny, but also kind of realistic as a business woman. And then there’s me as a person who has a soul and that person wants to connect. That person realizes that I’m not just here to make money, I am here to help people who are suffering. And I know that sounds cheesy and cliche, but it’s true. And lemme tell you, I don’t want to be one of those people who are suffering. So I will switch into a mode that is more polished, if that makes sense.

Speaker 3 (05:09):

That makes sense.

Speaker 1 (05:10):

Because I don’t want to starve. And so I do kind of go back and forth between, okay, I need to dial it back. And I think that people notice that if I was just all the time talking about what a person can overcome or the deep parts of our why and our feelings, then I think that would really drive away a lot of business. I’ve seen people who got up on stage and talked about aligning the chakras and they were never invited back. So you have to find a balance between being a compelling human who helps people overcome these internal struggles that we likely all face, especially as entrepreneurs, depression, anxiety, slow times debt overhead, really painful things that will keep up at night and destroy your health and destroy your relationships. And then we also need to focus on, unfortunately we have to project an image of success from time to time because I’ll tell you, I always get the most business whenever I’m on vacation, I can actively ask people to leave me alone while I’m on vacation.

(06:16):

And that’s whenever I get all the messages for, Hey, I want to do business with you. Because they see the success, they see that it works. When really that’s I’m spending the money, that’s whenever I’m the least successful because I’m not putting time into my business and the dollars are just flying out the window like someone who has an open wound. And so it’s funny because it’s whenever you’re doing the best that it doesn’t show, and whenever I’m making the most money, it’s usually whenever I look the worst, I haven’t had time to groom myself. I’m probably still wearing pajamas that day. And so it’s almost always the opposite as to who has money and who doesn’t. So the person you see with the super nice house and the super nice car, those people have confided in me, Hey, I have so much pressure, I feel like I’m going to lose it.

(07:03):

But those are the people that look up to and respect. And so that being said, David, if I was financially independent, 100% I would be genuine and deep and all the time, if that makes sense. It would be like, Hey, when you woke up today, did you thank God for just waking up? And what are some ways that you can lower your overhead? What are some ways you can increase revenue? Are you wasting time on non-revenue generating activities? Are you doing too much stuff for free? Those of us who are in real estate, I think we do too many things for free. And like you and I talked about, it’s not just your expenditures that are on your books, it’s also the expenditures that are on your time. And so I talked to my attorney last week about dropping non-revenue generating businesses that just aren’t converting because there’s hope in one hand and there’s numbers in the other.

(08:02):

And after a certain amount of time, you need to realize which businesses are covering for the businesses that are taking a loss. And so my lawyer kind of sat me down and I know you do this, and we had to look at which businesses are just not generating and which are carrying the ones that aren’t. And he said, just focus on the ones that are. And so that being said, whenever we wake up every day, if we are our real selves all day, it usually doesn’t translate into revenue. But when I have the luxury of being myself, David, I always want to reduce the suffering of others because that’s kind of all I’ve done my whole life is I’ve had to overcome and overcome and overcome and overcome to a degree that just feels, it could feel really unlucky if I let myself go there. But instead of feeling unlucky, I have to see the opposite side of it. So for all the extremely low probability things that happened to me, there’s also extreme low probability things that happened for me. And you have to see both.

Speaker 3 (09:11):

Right. That’s really good. That is really good. So since we’ve gone down this road, and especially for the real estate investors listening, what would you say are some of the best revenue producing activities they could be doing or that you see in your own life that you do that translates into that

Speaker 1 (09:29):

You have to fill a niche that nobody else is filling? You have to see a problem that everyone is facing a hitch in the giddy up that’s keeping everyone from making money. What I’m noticing right now, for example, people don’t have the money for down payments on their loans. So like we mentioned before the call, I’m offering a program where you can do a hundred percent financing as long as you’re one of my cold calling clients. And it blew up because people don’t have the money for a down payment right now, and my cold callers really aren’t that expensive. And so it solves that problem for them. And in the past, the biggest problem was finding deals. And in a market where you can’t find deals, but there’s plenty of money, then you have to be the person who knows how to find the deals.

(10:16):

And so you have to find what’s keeping people from making money today in the current market and then really, really leverage your social media and go speak, like you and I talked about before, go speak on those topics, mention it on social media, put it in your stories, tell people what you do, and then be really consistent with your message because people are watching, they want to see consistency. And it’s like my lawyer taught me, who’s Jeff Watson? If they see you being erratic and all over the place and not consistent in your message, then people don’t trust that they can go to you to solve these problems. And so that’s the big key is leveraging your social media and being really consistent in your message and making sure that you’re solving the problems of today. So those three things, consistency, solving the current problems and just making sure that you’re leveraging pretty much every avenue that you can.

(11:16):

And of course, always want to be competent and run an ethical business because you can spend 10 years building a reputation. And if you hire one bad employee or someone who makes you look bad or doesn’t deliver for a client, unfortunately bad news spreads like wildfire and just whatever you’re buying on Amazon, you’re going to pay more attention to the bad review than the good reviews because we’re looking for to avoid pain for good reasons. I mean, some things could take us out and set us back a decade if we make the wrong investment. And so it’s really, really important in a capital intensive business what we’re in to be someone who’s trustworthy, competent with very high integrity. Like you and I talked last week and I told you, I was like, Hey, I can’t be consulting on a topic that I don’t know about. Thank you for the inquiry. But that would be horribly unethical. And you have to do that. You have to turn down the fast money for the long-term play of having high integrity.

Speaker 3 (12:18):

Yeah, no, a hundred percent. That’s really good. I think that’s consistency, solving the problem for today and then getting the message out. So those are three steps there. And I think that’s where it’s like, it’s so simple, but it’s like that number one, you got to do it consistently and you got to move to where the market is. So I think that’s really good stuff because I can’t agree more because I think, do you think that a lot of real estate investors build themselves into a box and then when that solving the problem of what they used to do doesn’t solve it anymore, that they have a hard time pivoting to something that will and bring the revenue? Yeah,

Speaker 1 (12:57):

I mean you have your fast movers, your highly networked people who are poised to move, but for anyone who doesn’t want to hustle 24 7, it’s hard to pivot like that. I mean, at some point, I think human beings, we all want consistency, predictability. And one thing that’s really tough about this business, and I’m sure everyone notices, is how fast paced it really is. Now, if we were in the paper business, for example, David, how much do you think things change? Speaking of office space or not office space, the

Speaker 3 (13:35):

Office office,

Speaker 1 (13:36):

Yeah, yeah. I mean if we’re a paper company, how often do you think the industry changes? Right.

Speaker 3 (13:42):

It doesn’t really change. I don’t know.

Speaker 1 (13:44):

I mean maybe a paper guy comes and messages us and said, oh, you wouldn’t believe.

(13:51):

But it seems like from the outside looking in that real estate, every day there’s some new gimmicky stuff and you’re just like, I can’t handle this. I need to step away because I can’t handle one more gimmick. I can’t handle one more big change. It’s difficult. And so I think knowing the fundamentals, because I know people who make big money just using a yellow pad for their CRMs still, and some of these people are big names, and I don’t think he’d mind me saying, Adam Johnson, Leon Johnson’s son, he does a lot of deals just using a yellow pad. Courtney Frickey, she has her paper leads that she keeps in a file and only goes through them if she needs to. So a lot of these gimmicks just really aren’t the real deal. The real deal is not necessarily what software you’re using, it’s where are we in the market, are there more deals than money or is there more money than deals?

(14:47):

Those are really the main two shifts that if you pay attention to those in the market, you’re good. And people was like, oh, I do this with AI and I do that with ai. I haven’t seen AI do anything really amazing except for Google search type stuff. I mean, I’ve listened to the AI calls and they’re still not that great yet. And I keep hearing people say, oh, AI is going to be doing our acquisition management soon. Well, yes, true, but when I haven’t seen it yet and still, which problem is it solving the low money problem or the low inventory problem? And right now I think it’s market to market. It’s kind of like mushrooms and in certain markets we still have an inventory problem and other markets are more of a buyer’s market and we have more of a money problem. So you have to take it market by market, city by city and see which problem are you solving. Those are really the main two problems in real estate. And what I’ve seen is everything else is a marketing gimmick. As someone who does marketing myself, we try to repackage it to get people’s attention, but it’s kind of all the same stuff.

Speaker 3 (15:59):

Yeah, no, that makes sense. So would you say then the people like Adam and the people like Courtney, are those three things that you mentioned before consistent solve the problem for today and then the media and the messaging is that their key to success and as long as they’re consistent doing, what’s really is that or is there something that makes them different just because they go out there, and I love how you said with their CRM is a yellow legal pad, it’s none of the fancy stuff and all that where a lot of people get trapped in that rabbit hole. So that’s where my I’m wondering, yeah,

Speaker 1 (16:31):

Courtney’s really consistent on Instagram and she gets a lot of referrals. And Adam’s been in his market for 20 years, so he gets a lot of referrals. So you talk about consistency, it’s decades of consistency in Adam’s case, and Courtney has been doing it I think for 10 years, and she really gets out there in terms of, she speaks in front of realtors groups, she speaks at rhe, she holds her radio show, and she’s very consistent in her branding. She doesn’t just show herself boating on the weekend or shopping or whatever. And if you look back through her Instagram, you can see that in the past she did have more of showing her personal life. And Connor Steinbrook taught me, don’t show your personal life, just make your entire page about business. But there is one caveat to that. You don’t want to look like one of those VA generated pages where there’s no real person behind it.

Speaker 3 (17:23):

It

Speaker 1 (17:24):

Looks like a VA just runs my page and it’s just my VA who does everything. So I do post pictures of my family and going to the gym, and if I do go on vacation, I do post that. But too much of it makes people think you’re not available for business. So I would say the golden ratio that I’ve discovered is about 90% business and 10% personal, just to add that speckle of reality that you are a real person and not a va. And I think Courtney does that very well on her Instagram for example, and she doesn’t even have to spend money on marketing. She told me she doesn’t do that anymore. She’s a hundred percent referral based now and it’s taken being consistent

Speaker 3 (18:04):

And she does a lot of creative deals or that’s all she does is the creative type deals. She

Speaker 1 (18:10):

Does kind of everything. I know her to do flips, I know her to do. She’s mostly a buy and hold investor and she will do creative when she needs to. But I think I’ve had a lot of clients come to me over the years and try to curate a marketing plan where all we do is creative for them. And that is really tough. You’re going to have a low ratio of being able to do that. Typically creative should be something that comes organically from time to time. If you make that your only goal, and this was a guy with a lot of money, by the way, the one I’m thinking of. He had so much money, yet he was super focused on just doing creative. And I understand if someone has no money and they’re just focused on doing creative, but they get it in their head that this is the way to do it and there is no the way to do it.

(18:55):

You have to just solve the problem of the current seller who wants to sell, whether it’s a listing, whether it’s innovation, whether it’s a flip, whether it’s a wholesale, whether it’s long-term buying hold subject to seller finance, and anything else I’m missing in there. It shouldn’t just be, oh, I’m going to pull this list and I’m just going to do ovations or I’m going to do this campaign. I’m just going to do subject two. You need to just be able to solve the seller’s problem and just start with one, this is something I’ve taught for years. Just start with one exit strategy that you’re really competent in. And then once you master that, expand from there, and like you and I talked about, it’s who not how you don’t have time most likely to master all of those. So have a referral partner that you can build a relationship with and trust for innovations for subject to maybe even for seller financing or maybe master two, but mastering all of the above would be insanity. Even if you had been doing this for 50 years like Leon Johnson, that would be insanity. So be ready to leverage joint venture partners that you can trust with the right paperwork behind it. Of course.

Speaker 3 (20:02):

Would you say that if you go down that road, can you build a business like that? Meaning where a business is systems and other people where eventually you have a business that runs itself or runs it with the people in the processes you’ve put in place. It seems like with real estate, like you’re saying, I have to solve the seller’s problem right then and there. So it almost sounds like you need at those higher level people, you can’t just get the McDonald’s line worker that’s there or the robot or AI or something like that. That’s

Speaker 1 (20:33):

The challenge that I’ve run into. And I feel like conceptually it can be done, but then in psychology we have something called channel factors, these little things that get in the way of what sounds good on paper. And that’s usually where the human element comes in because I have staff of 180 people in my agency and I’ve learned little tricks to managing them. For example, this is going to sound weird, I don’t do company meetings because I just meet with them as I need to. I do spend a lot of time with them upfront, maybe a few hours, and then I never talk to them again except to tell them when a job has come in. And if they need more than that, they’re probably not a good fit. And I don’t do group meetings because I’ve had them all group up against me in the past to raise wages, basically wanting to unionize whenever my clients can’t afford that.

(21:27):

And I said, I’ll let the whole company burn down before I let you extort me in this way. And I did. And I did it privately. I didn’t tell anyone. I didn’t go public about it, but I just stopped the company for six months and just traveled. And it’s like I have plenty of money. And then they were suffering. And then once I was done traveling, they were like, Jen, please, please, I’ll come back. So who would think that there’s a human variable of needing to stop people from organizing against you, or it’s like Adam Johnson says, you have to make sure that you’re always in the way of a deal in order to get it done. So that’s why you can’t fully replace yourself for the most part unless you sell the company, is because at some point somewhere you need to add value. And yes, you can have an integrator, and yes, you can have a CEO, and yes, you can have a CFO, et cetera, but if you notice even in a C class corporation, you still have shareholders.

(22:24):

The shareholders are still in the way in some way because they own a part of the company. So no matter what, you have to make sure that you’re in the way of other people just taking over completely what you do and just pushing you out. And so that is the challenge. That’s where replacing, that’s what no one talks about. Everyone wants to sell these sexy business models where you’re just on the beach or whatever, but at some point you have to put yourself between yourself and someone else to make sure you’re still adding value or you’re just going to get pushed out. So another example is, I mean, you can just live like my older gentleman, friends who just own a bunch of mutual funds and they don’t manage anything. They just collect checks from the dividends, but you have to have millions in order to achieve that.

(23:17):

Lemme tell you, those are the people who have the most passive income that I’ve seen, and I know this is an REI podcast, but what’s great about real estate is you can start with a relatively small amount of money and then with appreciation, leverage that into millions, and then you can become the mutual fund, the note owner or your kids can get your portfolio, but it’s not as passive as just having your mutual fund dividends come in and as know the stock market goes up and down where rents typically, there’s not as much fluctuation in rents as there is in the stock market. And so all that being said, going back to what you asked, whenever you’re managing staff, there’s just going to be all these psychological factors that are not going to present themselves on paper with your staff is always the biggest challenge in running a company.

(24:11):

And so that’s why I don’t do company meetings because that’s whenever people get together, and pardon my language, I think it’s a poignant word. They start bitching and then that causes morale issues. All it takes is one person to start griping and then morale goes way down. And I don’t care how well you run your company, I don’t care if you are like you have in the background, I don’t care if you’re Mr. Rogers, as soon as someone starts griping and it takes hold, it’s game over. This doesn’t work if you run a brick and mortar business. But I have doctor friends, for example. They run brick and mortar businesses, and one of my doctor’s friends two weeks ago, his entire staff just walked out. They’ve been with them for 20 years and they couldn’t have organized like that if you keep them separate. If you’re running a virtual business, that’s one of the benefits is you can manage your staff. And I tell you, that has made my income extremely passive.

(25:09):

So if you take nothing else away from this by keeping my staff separated, I have generated true passive income for myself because all I do is bring the jobs, bring the clients, they work the clients, and then they do a good job and then I’m out. The only thing I have to do is keep bringing in new clients because there is always going to be some small amount of attrition no matter how good of a job you do for various reasons. So yeah, if you have a virtual business, keep your staff separate and that way they’re not coming together. And it’s amazing how peaceful things are. I have no drama. I have no complaints. I’ve known go well. so-and-so did this, and so-and-so said this, and so-and-so gets paid this and I want to get paid this. It’s like I have literally zero drama in my agency with my staff now, and that has just been amazing.

Speaker 3 (26:03):

Yeah, that’s the first time I’ve heard it put like that of keeping separate in that you don’t run meetings and you don’t get them together, which is very anti, a lot of the books out there and a lot of those systems and stuff that have the organizational meetings and that type of stuff, level 10 meetings or the level 10 meetings and all that, that goes along with it. So I love hearing a contrarian viewpoint, especially for someone who runs a virtual business like that and who’s gone through almost like you said, the utilization of that type of stuff. Yeah, I’ve been this for

Speaker 1 (26:37):

Six years, and so that’s enough time to where you’ve passed some task, kissed a lot of frogs and had every problem under the sun.

Speaker 3 (26:44):

Yeah, yeah, no kidding. So that’s very interesting. Well, this has been a lot of fun. I love the answers that you’ve given. I think there’s some really good value there too with being consistent, solving today’s problem and getting it out there, being consistent of getting out your message as well too. I also like that what you just went over that was so contrary to what other people say. That was really an interesting take. I want to, and I

Speaker 1 (27:10):

Would bet you my headaches are much smaller than theirs,

Speaker 3 (27:14):

Probably. Probably. I mean, well, most people have the headaches in business, and if you just have less than them that it probably wouldn’t take much if you just had just that many less. So that’s great. I love hearing that. What I wanted to talk

Speaker 1 (27:29):

Authentic draws better clients too. I did want to share that because I know I went on a bit of a rant and a ramble about that, but let me be pointing on one point is that by being my real self, David against my business advisor’s advice, the clients I have now, I have no drama with and I don’t know why I’m not smart enough, I guess to know why. But the ones who come to me whenever I’m going through times of being very authentic and just really sharing whatever it is, whatever business problems or personal problems that I may be facing and how I’m overcoming them, I get so many people, like you said, who may not do business immediately and it scares off a lot of people. But the clients who do come to me, we have no problems, no drama. They don’t blame me for a lack of success.

(28:13):

They just come in, show up, close their deals, and they stay long-term customers. So that is one benefit is I get fewer clients, but the ones that I do get, I have zero drama with, and we’re so simpatico that I work hard to make sure they’re successful and they don’t. Whenever I was being inauthentic and getting a lot more clients, we don’t have meetings about Jennifer, why am I spending this money and not getting any deals and then this, and they’re just being very nitpicky, but clients where I’m my authentic self, they come in and they just close deals, David, we don’t have to have awkward meetings that make me feel like crap about myself, feeling like I’m not really actually helping anyone and I’m just charging money and nothing’s happening for them. They come in and they’re like, Hey, Jen, I did this deal. I did this deal. Your staff is great. And so that was a crazy change to me. I thought, this is self-destructive behavior being this authentic, but I just felt compelled to actually help people. And then these clients are the most low maintenance clients I’ve ever had. So I would be curious what your take is on that in terms of why is it being authentic? First off, it’s interesting. It draws in less clients, but the ones that does draw in, I have zero drama, zero problems with, and they stay with me forever,

Speaker 3 (29:36):

Which is funny because what you’re describing now is in those books that tell you to have the meetings, it’s like it’s your core values. It’s the values that are shining through that. It’s people that resonate with you as a human being. So usually they’re going to be the ones, especially if you’re being authentic and being open and honest and sharing values that are just as a society, we look at and say, it’s mature what you’re doing. You draw those mature people in, so it’s like they’re going to be the ones that sit back, they do the deals, they get it done, and then they come to you and they be like, yeah, let’s keep moving forward. And that’s the low drama because projecting that out there as well too, just from what I can observe right there. But I really like that because very much of if you’re going to be yourself, you might bring in less, but you might bring more of the people that you want to work with. That’s what I took away from makes income

Speaker 1 (30:26):

More passive because that is always my goal. Low drama staff, low drama clients where we’re just doing deals. I’m providing excellent staff who are going to make sure that you’re getting in front of as many people as possible for as little money as possible, talking to those motivated sellers, getting good prices on data, getting good prices on your loans to close your deals, and just keep it simple. There shouldn’t be any insanity. There shouldn’t be a lot of complaints and craziness. And that’s not to say there’s never problems, but when there are, it’s like, Hey, Jen, we need to have a meeting because this caller’s gotten a little too lax and they’re just becoming too rote and they’re going through the motions too much. I had to have that call three months ago, but guess what? He didn’t leave. He didn’t blame. He said, Hey, let’s just fix, let’s just fix their script.

(31:12):

And so I told her, I said, Hey, you’re one of my best, and maybe you’re working too long hours. Maybe you need to take more breaks. Maybe we need to load you up with fewer clients because instead of listening to the seller, you are kind of just pushing through the script. I said, someone who started out cold calling myself, I noticed I would do that towards the end of my shift. And I said, so let’s just be aware that that’s what’s going on. But I didn’t blame or shame her. I just said, Hey, because I was sitting in that seat myself for so many years, David is a cold caller. I know what problems they face, and it makes me a better manager for them. And just say, Hey, it just sounds like you’re getting a little tired. And so take a 30 minute nap, take an hour nap and come back and you’ll see how all of a sudden, instead of just pushing through a script, you’re really an active listener.

(32:02):

But that’s the only problem client meeting I had to have in the last six months where before God, David, it seemed like it was every day. People were just pinging me with this is a problem and that’s a problem. This is a problem. And I think that’s what led to my heart attack last year at 38 years old, was just having all these clients with all these complaints and it was just driving me crazy. And now I don’t have any of that. And so just sharing my experience, whether it’s true or false or somewhere in between. It’s just my anecdotal experience.

Speaker 3 (32:36):

Well, no, that’s really good. I wish we more time, but I’m going to land the plane here. We’ll have to do another episode too about how you got through that and coming out on the other side. But if people want to get ahold of you for your cold calling and what you’re doing there and how would they get ahold of you if they want to start to work with

Speaker 1 (32:54):

You? Yeah, whether it’s the cold calling or like I said, the loans where we’re offering a hundred percent financing on both the rehab and purchase price. If they’re my cold calling client, they can just email me at jen, JEN at rre I data source.net. I’m also a really brave person who gives out my cell phone because as a cold caller, I’m not afraid to call you. You

Speaker 3 (33:18):

Can call me,

Speaker 1 (33:19):

I may think you’re a spam call and answer a little bit briskly, but my cell phone is (469) 952-8011. Feel free to call me there or Jen at REI data source.net.

Speaker 3 (33:32):

Cool. So that’s how you could get ahold of Jen, and that’s the email. And she gave your phone number as well too, so you could call her in and say, Hey, hey, just wanted to see if you answer the phone. I’m sure you will. Like you said, who does that? Right? Who? Their cell phone. Cell phone. And then who does that? And then actually answers too. I feel like today’s age, please go to voicemail. So that was good stuff. Lots of valuable information here, stuff that you could take and I think implement right away to become these type of people out there that are consistently successful. And that’s one of their keys to success is being consistent in solving today’s problem, building the message around that as well too. I really liked your insight of the type of client you draw in when you are your authentic self versus where you might get more, but it might be more headaches if you are not. So it’s like just lots of good practical things today. So that was a lot of good stuff. Thank you for sharing, Jen. I really appreciate all that you did here today.

Speaker 1 (34:26):

I appreciate it. David, thank you so much for having, thanks for asking great questions.

Speaker 3 (34:30):

And I wanted to say too, if you’re listening to this and you’re like, oh my gosh, I’m not making enough or whatever, first of all, call Jen, you can literally call her. She gave you her number. She can help you make more money if you need to keep the money too. If you’re like, I have no idea where my money’s going, don’t know what my overhead is, don’t know how much I’m making, how much I’m keeping, or I want to keep more, you can reach out to us@simplecfo.com. We want to help you get at least that stuff in place because if you don’t have any idea, you’re not running a business. So that’s where I want to help you at least be consistent in knowing where your money’s going too. That’s another consistency factor as well too there. But Jen, again, thank you so much for coming on and sharing, and if there’s anything that you need from Jen, you know how to get ahold of her. She gave you the email address and her phone number. Again, thank you so much for coming on today.

Speaker 2 (35:17):

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.