Buying 12+ Real Estate Deals Every Month (And How to Lose $750,000) with Sam Craven

Brandon: This is the BiggerPockets podcast Show 271.

“I think if you’re starting off, be relentless. Don’t let one thing hold you back. Don’t let that one sale that fell apart that you really needed keep you from pushing and finding the next and finding the next and finding the next”.

You’re listening to BiggerPockets Radio. Simplifying real estate for investors large and small. If you’re here looking to learn about real estate investing without all the hype, you’re in the right place.

Stay tuned and be sure to join the millions of others who have benefited from BiggerPockets.com. Your home for real estate investing online.

Brandon: What is going on, everyone? This is Brandon Turner, your host today of the BiggerPockets podcast, here with my wonderful co-host, David “The Man” Greene. How are you doing?

David: How did you know that that’s my new nickname?

Brandon: I’m going to start doing that on BiggerPockets every week, come up with a new nickname for whoever the co-host is. But anyway, how are you doing? Welcome to Hawaii. You’re here with me in Hawaii. This is awesome.

David: This is an amazing place and I just want to say that I think my nickname as “The Man” should stay for everything. You can have a new one every podcast and I’m just always going to be “The Man”.

Brandon: “The Man”. I’ll work on that. So yeah, David and I, for those people who are not watching the YouTube version of this or the Facebook or whatever, we are actually together, live, sitting awkwardly close to each other. Like I can smell him.

David: Our leg hairs have touched several times. It’s kind of awkward.

Brandon: They just did. So we’re actually live. Well, we’re not live right now if you’re listening to this on an mp3 or whatever but anyway, we are here together in the wonderful state of Hawaii because I’m still here for a while. And David decided to come out and hang out, talk real estate, talk investing, talk business, talk life, and maybe do a little bit of surfing. Are you going to do that?

David: Yeah, I’m here to be the Pinky to Brandon’s Brain as we try to figure out how to take over the world.

Brandon: I made that reference—true story. Like, two days ago, Scott Trench was here last week and Scott Trench, author of Set for Life, now President of BiggerPockets Corporation because he’s kind of running the day-to-day operations stuff, and Scott, he said, what are we going to do today, Brandon? And I said, “The same thing we do every day, Pinky, try to take over the world”. And he had no idea. He just looked at me and I was like, Scott, tell me you know Pinky and the Brain. And he said, what’s that? And I was floored.

David: I guess when you’re like this 24-year-old wonder kid who’s already a published author and President of BiggerPockets, it’s awesome except for you’re 24 and you don’t know Animaniacs.

Brandon: I know. So good. Anyway, all right. So let’s get on with today’s show. Today’s show, we are interviewing Sam Craven. Sam has been on the show a couple of times before but we take a very different approach today. Today, we talk about a ton of stuff. We talk about marketing. There’s actually been a million dollars in marketing, which is absolutely insane, every single year. We also talk about how to run your business, how to get over failure. He lost three quarters of a million dollars over the last few years. We talk about all of that. But before we get to the actual interview with Sam, let’s hear a quick word from today’s show sponsor.

Here’s why I’m a big fan of SimpliSafe Home Security. SimpliSafe is ready for anything that gets thrown at it. If a storm takes out your power, SimpliSafe is ready. An intruder cuts your phone line, SimpliSafe is ready. Say they destroy your keypad or siren, SimpliSafe will still get you the help you need. And here’s what I love about that. Sure, maybe it’s overkill and maybe you don’t need to be ready for every worst case scenario but that’s what makes SimpliSafe so great, because it’s always ready. Now, SimpliSafe could cost an arm and a leg. It should but it doesn’t. That’s because they’re good people over there at SimpliSafe. They charge you what’s fair. $14.99 a month. No contracts. No hidden fees. I recommend SimpliSafe to everyone I know. You’ve got to check it out. Go today to SimpliSafePockets.com. Again, that’s SimpliSafePockets.com.

All right, big thanks to our sponsors always. Now, before we get to the interview, today we have to talk about today’s Quick Tip. Today’s Quick Tip is brought to you by David Greene. What do you got for us, David?

David: Today’s Quick Tip will be when you are planning on growing from a newbie into a successful whatever it is, investor or wholesaler, house flipper, buy and hold owner, whatever your fancy is, keep in mind that systems are what make your business a business and without systems, you can never exit. So in our interview today with Sam, we went over how he’s actually buying other wholesale businesses so someone could theoretically build up a really big business, create systems, sell it to him and then back out and go do something else with their life or come hang out with Brandon in Hawaii. I think that that sounds like a really good idea.

Now, building systems is usually a pain unless that’s kind of your thing but it’s very, very important to do. Not only will it make your life better but it will also give you a business that is a business and has a value and can be sold. And I would say you can’t put a price tag on that but you actually can. And people like Sam will pay you for it. So that’s a really strong incentive to do it. As you’re learning new things and in the beginning, most of us, our initial problem is confidence.

We’re trying to get over the confidence and we’re trying to learn what we’re doing. Well keep in mind that as soon as your confidence comes in and you figure out how to do something, systematize it right away and let that system evolve over time as your business grows and you’ll find that not only will you enjoy your job better but you’ll also have something you can sell to somebody else.

Brandon: That was really good. So let me tell you something funny. I did not tell David he was going to do the Quick Tip today and I just sprung that on him right here, live. You heard it. That was at the top of his head, he came up with that Quick Tip. So that’s why they call you David “The Man” Greene.

David: And that’s why they call you Brandon “The Jerk” Turner.

Brandon: All right. So let’s get on with the show. Before we get to Sam, I will ask one more thing. Leave us a rating or review over in iTunes. It helps us reach more people. Please do so and then do me a favor. Let me know that you did. Hit me up on Twitter at BrandonatBP or on Instagram @BeardyBrandon and let me know that you left me a rating or review to make me feel all warm and fuzzy and I’ll give you a virtual high five. All right, with that, let’s get to today’s interview.

All right, Mr. Sam Craven, welcome back to the BiggerPockets podcast. Another three-peater. I think you’re one of the few three-peaters here on the show. How are you doing?

Sam: I know, I think I get to say that I’ve been on the podcast more than Grant Cardone at this point, right?

Brandon: That you have, that you have.

Sam: No, we’re not even close. I love that guy. We just took the team, took a few guys from my team and one gal to Grove Cotton.

Brandon: Oh yeah, I wanted to go to that and I did not. I wanted to go to it but I was in Hawaii. How was it, good?

David: I wanted to go to it—I don’t feel sorry for you. Not even a little bit.

Brandon: Good, good. Was it as amazing as it looks?

Sam: It was. It was really good. Phenomenal speakers, came back with like a laundry list of things I want to do in my business. Same with the team members. It was awesome. It was well worth it.

Brandon: Very cool. All right, well, Sam, for people who are not aware that you were on the show before or haven’t heard you on other episodes, can you kind of walk through who are you and give like a five-minute recap. Who are you, what’s your story look like the last x amount of years you’ve been in the game?

Sam: Cool, yeah, a really great place to start. So I started this business actually six years ago now. I started the company with my dad. Fast forward a little bit. So I started it with my dad, we were doing some business, we were flipping, we were doing some wholesaling. We didn’t really know exactly what we wanted to do. We just knew we wanted to be in the business. So that really kind of stemmed from, I didn’t want to have the job anymore, right?

It’s the same story that you always hear. You get tired of making other people money. You get tired of working everyone else’s hours and not your own. And that was me. That was my dad. We decided to start the company and so you know, our first year in business, we did 20something houses. That was just absolutely phenomenal and we’ve just grown and been fortunate enough to grow exponentially year over year.

And so what we did though, what we realized is we get more and more focused on one particular thing, be it wholesaling or rehabbing or whatever the case is, that we get better and better. We make more and more money because for a long time, actually for the first three or four years, we were doing some rehabs and some wholesale but it got to the point where the rehabs started to be a distraction.

We realized we’re not as good at rehab as we are sourcing property, adding value to homeowners, adding value to buyers, and bringing that wholesale inventory to the market better than our competitors. And when we realized, okay, that’s our—I know you had the author of The One Thing on your show. The more we got focused on our one thing, the better we got, the more profitable we got, and the bigger the impact we can make.

David: So I think that’s an awesome point for the listeners, Sam, that you recognize this is not my one thing. I’m better suited to be a wholesaler than a rehabber. For the people listening who are trying to figure out like what’s my one thing, right? They’re getting started and they’re trying to figure out how do I get there? Can you share with us how you knew that was your one thing and how you recognize this is what we should be focusing on and not that?

Sam: Yeah, I was losing a lot of money. We were going off into the world and we were doing—and actually, we found there was really one niche to the market that we were losing all the money in in these rehabs. And let me just quantify that for your listeners real quick. When I said losing an amount of money, I’m not talking about $20,000 or $50,000 or $100,000. I’m talking about three quarters of a million dollars was lost over two years. To be exact, $760,000 and some change. Okay?

Brandon: I want to hear more about that.

Sam: And absolutely I want to share that because I believe, I strongly believe that we learn just as much from the big checks as we do from the big checks that we write. So I’m really happy to be able to share that stuff with your listeners. I believe we as an industry don’t like to share a lot of the bad things that happened to us. It’s all rainbows and unicorns. We’re all making a lot of money out there but there’s definitely some pitfalls and some ways you can get in trouble so let’s absolutely take some time to talk about that.

Brandon: Okay, yeah. Let’s go into that next. How did you lose three quarters of a million dollars?

Sam: Oh, man. Let’s go back to the exact point we just made. I wasn’t focused on the one thing. We were not focused on what we were good at. So we did it over the course of a relatively long period of time, almost two years, that we lost all this money. And while we’re losing all this money, our wholesaling business is growing in volume. It’s growing in profitability. It’s growing in per deal profitability. And I’m hiring more and more people and putting in more and more systems in place where not only are we losing three quarters of a million dollars but we’re also making a lot of money while there’s this vacuum at one side of our company that’s losing money.

And so one of the things why we were losing money was because we weren’t good at it. That wasn’t our one thing. And if you could get even more niche than that, we weren’t good at the high end of the market. That’s where we were losing all of our money. I mean, all that money was lost over maybe nine or ten different deals, just one after the other. It wasn’t like it was just one big deal or like a whole lot of little deals. We found ourselves in a part of the market that we should not have been and we learned our lesson.

David: So Sam, tell us, when you say you’re losing money, were your rehabs going overbudget? Were they taking too long? Did the person who was kind of looking at your ARVs not know what they were doing and they were coming in higher than they should have been? Can you walk us through what you did wrong so people can know like, hey, this is what you want to avoid or if you find yourself doing this, maybe you’re in the wrong spot. You need to find a different place.

Sam: So phenomenal question. Those were questions we were asking ourselves every step of the way. What we found, the issues were everything that you named. We missed an ARV. We missed a rehab number. We bought it at the wrong price. We got screwed by our contractor, which even though our contractors know, yeah, they screwed us out of $50,000, which happened a few times.

Whose fault is that really? Is it their fault or is that our fault? It’s our fault. It’s absolutely our fault. We have to take ownership of that. And actually, having been screwed by a contractor so many times drove us to start a construction company which we now have a construction company that only services real estate investors in Houston. And we can talk a little bit more about that later, because it ties in really well to the way that our business models work now and how focused we are in adding value to our clients.

But how we lost that money added up to everything that you said and then some. And it’s not that we were stupid. It’s not that we only made one mistake. We made all the mistakes. Every single mistake you can make, we did it, in pursuit of trying to get better and better. So we kind of kept making a different mistake every time and we’d tweak and we’d tweak and we’d tweak. We got better at it but it just meant we lost less money each time.

So meanwhile, we literally are getting kicked in the balls nonstop on our construction, or renovation company on these high end deals. At the same time, we’re just accelerating phenomenally on our wholesale company and at one point, we finally just popped our head up and said, look, this whole thing over here is just phenomenally profitable. We’re adding a ton of value. Let’s focus on that. And as soon as we made that mindset shift and that decision like this is it, this is our thing, we grew even faster. I mean, it was absolutely beautiful.

Brandon: You know what I love about that? So many people focus their entire time and their life on like trying to improve their weaknesses. Like, oh, I’m really bad at this or I’m not good at this part of the business. I better try to get better at it so they just keep trying to get better at it. But I love that you’re just saying like, look, if you’re not good at that, just stop doing it.

Like what are you really good at? I think that’s fantastic advice. Even just somebody who’s brand new getting started. Obviously, there’s a learning curve with everything so you gotta figure stuff out to figure out what you are well-conditioned to do but yeah, I love that.

Sam: It’s tough, too, especially when you’re starting off because everything is sexy. You get the shiny object syndrome. You want to go after it. Oh yeah, those big rehabs, that’s exactly what I want to do. And I spend a lot of time sitting down with people that are getting started in the business. I’ve travelled around the country for the last few years teaching people how to get started in this business.

A lot of them will say, I don’t even know where to start. The biggest piece of advice I give people is, know what you’re good at, know what you want your end result to be. Okay? Because I’ll have people come to me and say, I want to start wholesaling houses. I want to start flipping houses. Meanwhile, they have a job that’s making well into six, sometimes seven figures, that they say they love and don’t want to stop. I’m like, well, why do you want to build yourself another job? Why do you want to build yourself another business? It sounds like what you really want is passive income. And lots of times, they’re like, what? Passive income?

So the sexy part of this business is the wholesaling and the big checks and the renovations and things like that but that’s just not the right thing for everyone. It’s the right thing for some people. It’s the right thing for me and my team and my partners. But it’s not the right thing for everyone. And actually, I wanted to talk about, too—we spoke a minute ago about we started this company with my dad. My dad’s actually running a fund now that we’re involved with and I have my new partner in the business.

My dad’s still a partner but my new partner in the business is actually a friend of mine from high school, Matt, who is our very first hire. And I didn’t mention it earlier. I have to mention it now that he’s a phenomenal partner and I couldn’t be luckier to have him there with us because he was right there with us in the bad times and he’s here with us in the good times and he’s a huge part of our success.

David: So Sam, my guess would be, you guys were crushing it with your wholesaling business and all your attention was focused on that so you weren’t paying attention to what was going on with the rehab business and that’s how things got out of hand because you were doing so good. You’re bleeding from one end because you’re doing so great on the other.

And then you finally like cut off that area that was bleeding and now you’re focused on what you’re good at and where you’re profitable. Can you tell us a little bit about how your business has evolved, how many deals are you doing? How much revenue are you generating now? What’s your profit margin like, that kind of stuff?

Sam: Oh man, you just want me to just tell you everything?

David: Yeah.

Sam: Yeah, so let’s talk about that. So you know, when we were doing—I guess back when we were losing all that money, we found ourselves stuck. We kind of plateaued at like 60-70 houses a year. And that was it. We did two years in a row where I think one year, we did 60. The next year, we did 75. And as far as I’m concerned, that’s stagnant. Now, at the same time, our profitability grew by 20% at that same time, which again shows you that we had this beast at work.

Our average profit per deal increased quite a bit. But then as soon as we got focused on okay, we’re just wholesale, our business jumped. So it went from 60-70 to 130 in a year. And now we’re doing 15-20 a month and we’re spending a million dollars a year in marketing. A million dollars in a year. It’s even crazy for me to say it now because my first budget when I started off in the business not long after I was on the first podcast, my marketing budget was $100, $200, $300 a month. And now it’s like $90,000 a month. So our business is really, since we’ve gotten that focus, we’ve been able to grow our average wholesale profit.

I think the first time I was on the podcast, my average wholesale profit may have been like $5,000 to $8,000 a deal, which is pretty good, right? Except now, I think our average wholesale profit for this year is $35,000 a deal. So that comes along with, and we can talk about this, too, kind of like our sales philosophy, which is adding value everywhere. We add value to our sellers. We add value to our buyers.

I’m here in this podcast to give away a bunch of information. I’m not a paid educator. I don’t have a guru program. I won’t have a guru program but one of the things I’d like to talk—but act now—but one of the things I’d like to talk about is the fact that one of the things that we do for all of the people who buy houses from us that are in our ecosystem, as I call it, here in Houston or all over the country that buy houses from us, is we give away all of our education.

You want to know how to buy rentals? We do things from accounting to deal analyzers to walking a property, estimating repairs to what makes a good deal for you? We give away all this education for free. There’s not going to be an upsell for it. I want you to come in and I want you to learn. Now what we learned over the course of these last few years is that people come into this business and they get frustrated when they don’t get a deal.

I mean like, typically speaking, if they don’t get a deal within the first three to six months, they move on. Because they’re frustrated and they can’t get a deal. And it’s difficult. So we have all these people that are coming into this industry that in my opinion, we as an industry, we’re here to change lives. You want to invest in real estate, you want to change who you are in your life, buy property, it will change your life. I firmly believe in that.

So we have all these people that want to change their lives. They try to take some action but there are just a ton of information out there and they never take that action. Well, what I want to do is through this ecosystem that we have, I want you to take action. I want you to be successful. I want you to buy houses. I want you to buy houses from me but I want you to have what it takes, the confidence—the biggest thing is the confidence. Build the confidence in yourself to go out there and take action and buy a property. Whatever it is that looks like a good deal for you, just take that action.

David: So tell me, for the people that are listening that are like, wow, that sounds great. That’s what I need to start doing. I need to take action today. The first question I want to ask you is, what are you doing to spend a million dollars a year in marketing? What can people do to start marketing to look for a deal?

And then once you explain that, can you tell me a little bit about how your business is kind of structured? I’m imagining you guys have a big marketing division where you’re doing whatever you’re doing to get the phone ringing. Then you have a division where the people have to answer the phone and then you’ve got a division where okay, now we know who the serious people are—these are my negotiators who are going to put it under contract—when in the beginning, everyone’s going to be wearing every hat. And they’re not going to know like what they’re good at in the beginning, right?

So kind of walk us through what it’s like, what you do to get started, what you can expect and then how you can evolve that into having a business with different people that specialize in different things?

Sam: Oh geez, that’s a lot of questions. Okay. So I think let’s start at the beginning. And so I think the majority of our listeners are probably not doing the volume that we are. So let’s talk directly to the people that are trying to get a start. They hear a million dollar a year marketing budget and they say, holy crap, I don’t have that kind of money. And the good news is, you don’t need it. You don’t need to have that kind of budget in place in order to get started in this business.

But there was one really important principle that I want all your listeners to understand is that if you get started in this business, to start finding deals, you have to start spending one of two things. You’re going to spend time or you’re going to spend money. So source these deals. In our business, we call it the cost per acquisition. How much do I have to spend to get one deal? How much do I have to spend in time? How much do I have to spend in marketing?

And depending on your market, that cost per acquisition can be $5,000 or that cost per acquisition can be 25 hours or that cost per acquisition can be $500. It just depends on where you are. Big metropolitan cities like where I am in Houston, it can push up pretty high into the thousands of dollars. But the good news is that you don’t have to spend money. But you do have to spend time.

A lot of people come into this business, they want to get into this business and they want to get that first wholesale business and they don’t have any cash, that’s okay. I believe you can find deals. You’re going to bust your ass but I believe you can find deals. It’s just hard work. Now let me give away a couple of nuggets here. What’s the one place you can go to work hard and find that deal without having to spend any money?

Now, I think some of your listeners are going to think I’m nuts when I say this, but the MLS. Okay? The MLS is an absolute treasure trove of deals. But you gotta spend hours working it. Now you can spend hours working it and dollar for dollar, or hour for hour, putting work in, making offers, following up with people, things like that just from your computer. However, what we have learned in our office, and I’m putting my money where my mouth is here because I literally have salespeople in my office and their only job is to network with real estate agents.

But that’s that key term. It’s network. So they’re going out there, they’re meeting with people, they’re talking to people, they’re putting on CE events. They’re hosting events, things like that. And they’re broadcasting their message out to as many people as they can. And then the properties are starting to come in.

Now it takes time but you gotta put in the hours to get that stuff in. So if you’re just starting off in the business and you don’t know how to find deals, I would say, go to the MLS to find deals. Because not only can you find deals, we are finding deals through them.

Brandon: You know, if somebody is brand new and they want to go look at the MLS, which by the way, people, for those who don’t know, the MLS is where all the real estate agents put their leads, right? But I’m not a real estate agent. So I don’t have direct access to the MLS. I mean yeah, I can go search Zillow or Realtor.com, right? Would you recommend that somebody get their license before doing that or just start networking with agents or what’s kind of that first step in that process?

Sam: You don’t have to actually have your license to actually get on the MLS and start networking with agents. You don’t have to have a license to network and talk to people. Just go talk to people. That’s the most important thing. Just go talk to people and network. Make sure you know how to add value to them. So you add value to agents by saying, hey, you’ve got that deal. It’s an ugly house. You don’t want to list that house. Send it to Senna. You’ll get a check. It’s as easy as that. Send it to us. We’ll get you the offer. We agree on the terms. And then we’ll get you a check within a few weeks.

And so if you’re unrepresented, you can actually offer your 3% commission to the agent. So instead of them only making 3%, they’re actually making 6%. So again, you’re able to add value to the agent that way, too. So if you have no money, I recommend starting off in the MLS. If you have a little bit of money, start doing some bandit signs or something like that. I’m not a big believer in bandit signs. We don’t do them in our business but they still remain an effective way to market for properties.

Brandon: So what do you do for paid marketing in your business?

Sam: Happy to tell you. So I’m doing SEO advertising where we’re paying someone to manage the search engine optimization on our website. We’re doing Google Pay per Click advertising. We’re doing Facebook advertising which is showing a lot of promise. And direct mail. Direct mail as well and also we do some skip tracing and things like that but the majority of like the big money stuff is our direct mail and our web stuff that we do.

Brandon: Okay. Okay, that makes sense. Can you give any tips for like people who are just getting started with direct mail, maybe? I know we talked about that in both last shows we talked to you, but any just like low hanging fruit that people just do right now with direct mail marketing to get started?

Sam: Yeah, the best way to get started is to actually get the mail out the door. I don’t know exactly how many letters in the mail we’re sending right now. I think it’s somewhere around 80,000 a month, maybe a little bit more than that. And that can be kind of daunting if you’re new and especially for me, I think when I started off, I think I started off sending like a few hundred mailers a month and we were getting responses from it and we were getting deals from it.

And I can tell you in the marketplace now in Houston, if you’re only sending  couple hundred mailers a month, even sometimes maybe only a thousand or 2,000, or 3,000 mailers a month, it’s unfortunately not enough to get a deal. So you’ve got to find ways to get the marketing out in mass as much as you can afford, as consistent as you can afford. If you can afford to do 10,000 mailers, don’t do it all in one month. Break it up. Get that first deal. Get some cash. Roll it back into your marketing and grow your marketing up.

That’s everything that we did. I mean, when I started my company, I mortgaged my house and I sold a car for all the cash that I could get in order to start the company. And then even still only had a very modest marketing budget. And again, it comes back to goals. If you’re saying, I want to be the next biggest wholesaler or like for us, we want to be the single largest house buying company in the country that’s privately owned, we have big goals. That means we’re growing the company as quick as we can. We’re actually even looking to grow through acquisition right now.

Brandon: What do you mean by that? Can you explain that? What is that, grow back acquisition?

Sam: That’s a good question. So what we’re doing is we’re opening up a new market and we’re exploring opening up a new market ourselves. But at the same time, we’re looking to buy operators that are wholesaling in a A and B class markets that want to sell, that want that payday. You can get a nice big payday as well as some residual income over time if you decide to sell your company and that’s the ultimate lifestyle business is being able to sell your business, live off some residuals, get a nice little check up front and you’re done.

So instead of going to a new market and completely reinventing the wheel or having to learn about the way buyers buy and sellers sell and understand all the little nuances that it takes to wholesale effectively in the market, why not go in and buy someone who’s already killing it?

Brandon: That’s fascinating. I’ve never actually heard anybody doing that before. Obviously, I’ve heard of people buying and selling businesses. But not wholesaling business. So you’re saying if I’m a wholesaler and let’s say I’m doing, I don’t know if you have a minimum but let’s say I’m doing 50 deals a year, right?

But I’m just kind of worn out of wholesaling. I don’t want to wholesale anymore. I’m tired of it. I just want to go buy rental properties or whatever, right? I could just shut down the business and just lose everything or you’re looking for people like that that would just sell you their business. Is that what you’re talking about?

Sam: That’s exactly right. That’s exactly what we’re looking for. I want good operators that focus on the customer service, that focus on delivering value and have some systems in place. They don’t have to have a ton of systems in place but some systems, some employees, things like that that show that they understand what’s going on in the market. Of course, the longer they’ve been in business, the better. But there’s one operator I was talking with who’s been in the business for a couple of years and was already doing at a high level that we’re talking about buying.

So if we can grow ourselves organically, or we can grow a little bit faster through acquisition. And you’re right, I have never heard of anyone doing this and a couple of people who are very respected in the industry, I sit them down and I say, hey, I want to start growing my business through acquisition and they say, holy crap, Sam. That sounds like an absolutely terrible idea. But you know, that’s okay. That’s just not right for them and this is what we believe is going to give us the competitive advantage as we grow into more markets and achieve our goal of being the largest privately held house buying company in the nation.

David: Okay Sam, so let’s say that I have a wholesaling business and it’s doing well and I want to move onto something else. But I don’t want to just completely give up this business that I’ve spent the last couple of years working on. Can you tell me what can I do to put my business in the position that somebody like you would want to buy?

Sam: Good. Let me tell you kind of like the overreaching criteria that we have as we’re reaching out to these companies and as we’re learning about these companies. So if you have a wholesaling company that’s doing between 75 and 100 houses a year, you are profitable and you have enough employees and systems in place where you’re able to kind of focus on the high level. I don’t want to buy from someone who is still the one that’s primarily out there who is buying where you’ve been able to train a few people, things like that. What we have done really, really well in Houston is we’ve got systems, we’ve got processes.

We’ve got a big team. We’ve got managers, sales managers, general managers, things like that in place as well as a beautiful ecosystem of systems in place that I can inject into any business. So you give me a business that is fundamentally good, that is fundamentally profitable, and I can take the systems and processes that I have in place and explode that business. But it takes a good operator. It takes a good core business to have that in place in order for that to work. I mean, it’s a hundred times more complicated than I just made it sound but that’s our goal. Our goal is to find that and pour the fuel on the fire.

David: Yeah, I think that’s really encouraging though for anybody who wants to get started in real estate to understand that there’s all these fears and anxiety that come when you first get started and you feel like you don’t know what you’re doing. And then you hit a level of competence which usually leads to confidence and you’re like okay, I got this, and you start making money. But not a lot of people really take it to that next level where you systematize what you’re doing and you kind of organize it all so you can really just smash on the gas and get into like extreme wealth building.

But what you’re saying is, that’s what you’ve done and now you’ve got it down so good that you can literally go into somebody else’s good solid business that’s maybe not performing like yours and apply your systems to it and boom, it’s going to be performing much better. That’s got to give you like an insane level of confidence that you know I can go into any market. I just basically need the infrastructure and then I can put my systems in place and take over and take it to the next level.

Sam: That’s exactly right. And that’s exactly right. You know, the right kind of operator, too, would be able to play in the upside of that as well. Because lots of times, I mean, when you have, at least for me, I’ve been in the business six years. This business is my baby. This business is my life and for a lot of us, we feel that same way. And so some people think, well, I’m not going to sell my business. That’s my child. But one thing that wholesalers and wholesaling businesses have that don’t have that a lot of other real estate investors do, especially you buy-and-hold guys, is long term cash flow.

You know, a wholesaling business, we’re lucky if we have three months of cash flow planned out. Because it’s a kill what you eat business and because we’re a relatively smaller, we’re a service business, it doesn’t build a whole lot of cash flow. I mean, I know of a guy in a beautiful market that was netting a couple of million dollars a year in a wholesale business and the businesses shut down and now he’s got nothing to show for it. Whereas, you could sell that business and create some cash flow for yourself and a nice little payday at the same time instead of just shutting it down.

Brandon: Yeah, that’s super cool. I never thought about that idea before, of just acquiring somebody else’s wholesaling business and I think that’s fascinating from both ends. If you want to get out, you can sell it to a guy like you or if you want to get in, you can buy somebody else’s company. It’s just fascinating. Well good luck on that. I’m actually looking forward to hearing like how that goes for you in the next year.

Sam: We’ll have to schedule another interview to come on and talk about—hopefully, it’s going to be holy cow, this is awesome, we’re in five cities, or it could be like hey, that didn’t go too well. But you know, who the heck knows how it’s going to go but all I know is we’ve got to give it a shot.

Brandon: And what I like about that is that you’re basically like, you’re not afraid to tell people if that does suck. You’re like, you know, we lost three quarters of a million dollars the last three years on bad rehabs. Great, it sucks. And it’s one thing you said earlier. I think it was before we started recording or maybe it was on the call, but like, this industry is so big into like, look at this big check I just made.

And people posting checks all over the internet and in forums and stuff, and it gives this appearance that everything is great. You get into real estate and you’re just awesome and you’re instantly going to be good. But you know, people only brag about the successes. We’ve been talking about that a lot here on the podcast lately. People just brag about their successes.

Sam: Right, and it’s the age of social media. I can build the persona I want and my persona can be the guy that’s only successful, not the guy that struggled. You show me a guy that has been successful, I can show you a guy who has struggled. He or she may not be open about the struggles but I promise you, you cannot have success without failure. And for us, we got kicked in the balls a lot. We learned a lot but it’s because of that that we are successful.

And I believe anyone out there—even the guy who likes to post the big checks in front of the rented Lamborghini about how awesome they are, I promise you they have failures. I promise you they have faced adversity in their life or they’re fricking liars and they haven’t had to oar failure but frankly those people are here today and gone tomorrow. They just don’t matter.

Brandon: Yeah, that makes a lot of sense. All right so before we move onto the Fire Round and the Famous Four, I want to ask you about something I probably should have asked you, the first question. What does wholesaling mean to you? What does that look like? Because everyone’s got kind of a different definition of wholesaling. Like, what do you do? If somebody calls you, walk us through that process and how you kind of organize that.

Sam: So what always bugged me about wholesaling in the beginning was that it was, you start off with a lie. You meet with the homeowner and you tell the homeowner that you’re the end buyer. And everyone always says, just give them a one-page contract and fake proof of funds you can download from the website and just tell them, hey, I’m the end buyer. Everything’s going to be okay. And I think that’s bullsh*t.

I don’t think you start off with a relationship where you’re trying to help a homeowner, and that’s what we do—we make our money when we solve problems with the homeowner. I don’t believe you start that relationship off with a lie. Every single person we sit down with, my team sits down with, in their living room, and explains how we can help.

We are telling them we are not your end buyer. And everyone thinks that’s a big deal. I tell colleagues of mine that have businesses that are twice as big as mine that I do that and they think I’m absolutely bonkers. But we do it. The process is easier. Our reviews are better. The seller is happier. At the same time, I’m a big believer in adding value, okay? So I’m going to add value to the seller and we’re going to tell them that yes, I am wholesaling your house.

But then let’s talk about what it means wholesaling on the buy side. So when I’m bringing you a deal, what does everyone always complain about with wholesalers? ARV is wrong. Repairs are wrong. You’re wrong. You’re ugly. I don’t like you. No one likes wholesalers, it seems like, right? So what we have done on the sell side is we’ve changed that, too.

I told you I got screwed by contractors. So we started a construction company and now when we put out our e-mail blasts, not only does it say this is what you can do if you have your own crew—this is what you’re going to renovate the house at. I’m also going to include, most of the time that we’re doing this, relatively new—not every single deal has this but most have it where you have a construction bid. It says not only do I believe you can get it done at this price, you can pay me to do it at this price. Put my money where my mouth is and pay the company to do the construction work for you. But then some people are saying, well you’re still going to overinflate the ARVs.

Hold your horses, okay? When it comes to After Repair Values, we’ve teamed up with a hard money lending company in town and we put a property out, chances are, it’s going to have a construction bid that goes along with it and a third party appraisal. A third party, third party appraisal. We’ve got them going now where we supply the appraisal to it from a hard money lender that says you can renovate this house for this. You can come this much cash out of pocket. You’ll make this much money. It’s almost like turnkeying a flip or turnkeying a rental.

But we didn’t even stop there. What we’ve had in place now for a little while is I guarantee our ARVS. I guarantee our rental numbers. If we miss our ARV by 10%, I’ll write you a check for $1,000. If we miss our rental ARV by 10%, I’ll write you a check for $1,000. Now, before we did that, we had this idea—we went back and we looked at all these different houses that we did and we’re like okay, how many checks would we have to write? We looked at it and okay, I think we looked back to 150 houses. Of those 150 houses, we would have had to write the check one time. Since we’ve done this guarantee, we’ve written the check one time.

Brandon: Wow, that’s awesome. That’s a cool idea. I’ve never heard of a wholesaler doing that.

Sam: And we’re putting our money where our mouth is there. We’re taking this whole thing, this entire industry—we’re a used car salesman industry. No one trusts us. No one trusts the numbers we put out. And so, we now are putting in steps to make sure we’re getting as close as possible on our ARVs and now we have a construction company that people can come in and say, Sam, I want you to renovate that house for $30,000. Great. We’ll do it.

So again, everything is about making it easier for investors to come into the market and buy properties and take action and change their life. We want to change the lives of our sellers. We want to change the lives of our buyers. And we’re not going to be able to do that if we’re lying to them and telling them, do all your own due diligence. Check your own stuff out. Oh by the way, I forgot to tell you about the family of termites living underneath the house. It doesn’t fly well with me and it’s just, I don’t believe that’s the way that you should be doing business, period.

David: I love, love, love that because I tell people all the time that the two ways I can mess up the most in my buy-and-hold business is one, my ARV is wrong. And two, my rehab goes bad. Those are the two things that are the hardest to control. And really, I think you can control your rehab even more than you can control your ARVs because there’s some subjectivity to it. And then if you don’t know the person you’re buying from, whatever they tell you the ARV is, is what you’re operating by and you’re basing everything off of that.

So the fact that your company is providing appraisals and you’re actually standing by your ARV, it really takes a lot of the risk out of it for the buyer and it also takes away a lot of the excuses. Because if you’re being provided with information that’s that accurate, and like you said, it’s a really good idea. You have a hard money lender who can get involved and maybe that’s where they’re getting the funds to buy that property from. Well, that person’s got some skin in the game, too. So that dude definitely doesn’t want to give you a pumped up ARV. He’s not going to be trying to help your business. He’s going to be trying to protect his own.

So when you set things up like that and you’ve got multiple layers of protection, that’s a big thing I talk about in my book. That you need multiple layers of protection from people that have an objective stance in this whole deal. It gets kind of hard to mess up, frankly, when you’ve set things up that way so I think that’s great that you’re doing that. I would buy houses from somebody who has things the way you’re set up.

Sam: Come to Houston, man. We’ve got plenty of cash flow here.

Brandon: So okay, that’s a good question. What does it take—a lot of people probably want to buy from a company like yours, right? I’m a new investor, maybe. I want to buy from a wholesaler, legit wholesaler who is doing what they say they’re going to do and maybe even guarantee it like if they’re your company or somebody else, right? How do I get on your radar? How do I get you sending me deals? Not just you but just any good wholesaler. How do I get a good wholesaler to send me deals and not give them to the other guys?

Sam: So what we’ve done is we’ve created a closed group of buyers. So we have a buyers’ list of I think 80,000 people. Something like that. 80,000 people in Houston of people that pay cash for properties, that I send an e-mail to when we get a deal. But what we learned—okay, it sounds impressive. But it’s not. It’s just not. It’s ineffective. When I send that blast out, I’m happy to get 9-10% that open up that e-mail. It’s one thing to say, hey, raise my hand, put me on your e-mail blast, send me a deal. That’s ineffective at best because you’re going to get the deal, you’re going to look at stuff, you get analysis paralysis, you don’t take action.

So what we did is we created a closed Facebook group. There’s only one way you can get access to this Facebook group and that is to go to our website, to fill out a form, and then someone in our office will give you a call. And then they’re going to ask you questions and they’re going to say, tell me what makes a good deal for you. Tell me what your experience level is, what part of town you want to invest in, how much cash flow do you want, what ROI do you want it? How much flip do you want? What kind of financing do you have? I think we have thirty something different questions that we ask. And it goes into this database.

You get onto database number one, okay? And the database is going to be clearly what you want. And so, what’s going to happen is, when you fill out that database and you say, I want this, this, this and this, this, this. As soon as our team gets a deal in, they’re going to go to the database and they’re going to fill in the specifics. They’re going to say, this house has a 20% ROI, $200 a month or whatever the cash flow numbers are, whatever the flip numbers are and it’s going to say, call these 100 people. Call these ten people. Call these two people. It fits their numbers exactly.

Brandon: Super cool. One final question I’ve got before we go to the Fire Round—how do you motivate yourself? What I mean by that is like, you make good income already. Your business is crushing it. You’re moving along. How do you, without a boss over you, because this is something that a lot of newbies struggle with—without a boss telling you what to do, how do you motivate yourself to just keep going, keep pushing?

Sam: Man, I struggle with that question. We all have times that we need motivation. We all have times that you know, you just realized you lost a quarter of a million dollars or you don’t have the motivation to get out that day and it’s kind of difficult. But you really kind of have your vision. For me, it’s the vision. I told you, I’ve got a few friends that are in this business, that are doing it at an incredibly high level, that are making seven figures a year net. And they’re working five hours a week in their business. For a lot of people, that’s beautiful. That’s what you want.

I don’t care to work five hours a week. I work 50 hours a week and I’m perfectly happy with that. My motivation comes from, we’ve got deals I’ve made $150,000 on wholesale fee. We make a few six figure wholesale fees a year, without fail. And it’s funny, for me, that check clears and I forget about it. I don’t care. I’ll come home to my wife after losing $100,000 and making $100,000 and she was like how was your day? I think it was good. I think we’ve made some money today.

The overall vision for me isn’t just like okay, hey, I want that check. I want that money. I want that car. I love cars. I can blow money on cars like you wouldn’t believe. However, my goal is bigger than the car. My goal is bigger than the money. My goal is impact. I want to change—I’m stealing this line from a very close friend of mine who is a CEO of a beautiful company. I want to put my thumbprint on the way this industry works. I want to change the way that they do things. I want to change the way people invest in real estate.

And I want to—I believe you do that through a high performance impact. That’s one of the things on my code of honor. I want to make a high performance impact. I’m going to be in as many cities as I can and just through brute force, I’m going to change the way people wholesale houses. That means providing ARV or providing appraisals, if that means starting a construction company in every city—whatever it takes. If that means I’m telling the truth about wholesaling the house to sellers.

Whatever it takes, I’m going to change the way the industry is done. That’s what drives me every single day. I’m going to pop my head off that pillow. It doesn’t matter if I’m facing that huge loss that day or a huge check and man, I’m getting after it because that’s my big goal. So for your listeners who are maybe facing a little bit of that paralysis and whatever it is that’s hitting that paralysis, think about what your big goal is.

Think about what your why is. What is it that drives you? It’s probably not money. If it’s money, you’ve got to dig deeper and you’re not being vulnerable enough with yourself. It’s probably something bigger than that. Because the money came. The money’s here. I don’t give a shit. Okay, it’s about making that impact.

Brandon: Yeah, I love that. Well super cool, it’s been a lot of fun but we’re not quite done yet. We’re going to head over to the world famous Fire Round.

It’s time for the Fire Round.

All right, these questions come direct from the BiggerPockets forums, so real live people asking these questions. Right now, in the forums, I want to see what you’ve got to say, Sam. So number one, of the forum, let’s go with this one—what is the one thing a wholesaler should know before starting? If you could sum it up in one point, the most important thing they need to know before they get started wholesaling—what is it?

Sam: That is a really good question. The one thing that you should know if you’re trying to start a wholesaling business like me, like what me and Matt and Robert have done. Be relentless. Okay, don’t let little things hold you back. When you’re starting off in the business, you’re going to be frustrated like no other.

And either you grow the business, that frustration is going to be there but your problems are just going to be different. I think if you’re starting off, just be relentless. Don’t let one thing hold you back. Don’t let that one sale that fell apart that you really needed keep you from pushing and finding the next and finding the next and finding the next. Keep pushing.

Brandon: Yep, I love that. Number two.

David: All right, so Sam, do buyers’ real estate agents try to get you the lowest price possible? Or do they usually not bother to negotiate. What’s the incentive for them to get you the lowest price on a home that you were trying to buy?

Sam: Their incentive should be just to get the check. If they negotiate the price down $20,000, that’s this much to them on their check. They should be incentivized to get the deal period because that’s how they get paid if you’re trying to have a buyer’s agent represent you. You can incentivize them a little more by trying to bring you deals and saying hey, you get the 6% instead of the 3% and you can incentivize them by saying, hey, I know there’s that house that’s been listed a long time. How about I just get you a check on that thing, real quick, and then you can move on and start doing the stuff you’re good at?

David: I think that’s a really good point. There’s a lot of kind of back and forth between agents and the investor world—are they good or are they bad? And to me, I am a real estate agent now. It boils down to the mindset you have. Agents are not trained to work with investors. They don’t think like investors. The majority of their clients are not investors. It doesn’t make sense for them to learn investing. If you’re going to a real estate agent who works with people helping them find pretty kitchens, you’re going to be very disappointed that they don’t understand your world.

And the same is probably, too, the other way around. If you’re looking for the pretty kitchen and you go to the investor agent who keep sending you ugly houses that are great deals, you’re going to be frustrated. I think it really boils down to the responsibilities on the person who is looking for the right deal to find the right person to help them. It makes much more sense to go to a wholesale business like yours if they’re trying to find a deal. It makes much more sense to go to a real estate agent if they’re trying to find a house that they want their family to live in.

Sam: Right. Yeah, absolutely.

Brandon: Cool. All right, number three. Number three here. I like this one. Do you have any recommendations on the best city to buy—I’ll say all real estate—they asked multi-family but I’ll say all real estate because you’re a house buyer. Any cities that stand out? I mean obviously, Houston sounds like a really good city but anything else you’ve heard as just being like, yeah, I think that’s probably worth looking into?

Sam: So I’m a little biased. I really, really believe in Houston, especially after the flooding event that we just had. There’s a lot of opportunity here for single family or multi-family. I think multi-family in Houston is a little, at least for our Class Cs, I’m seeing the cap rates come down pretty dramatically on those. The Dallas market seems to be even more hot than Houston to invest. But you know, if you’re asking that question, I feel like that you need to get focused.

If you’re trying to think of like where to buy or things like that, anytime you’re looking to invest in multi-family or in any market, especially if you’re asking for multi-family for long-term, understand where you are in the marketside and where you can want to be and what kind of asset class property you’re looking at.

The Grant Cardones of the world—he looks at A+ properties that cash flow really well. They’re going to be around for a long time. And because of that, he continued to buy in Houston and be affected by it. I know he just closed a huge, huge property here in Houston recently. But then you’ve got little guys like us that want to go and buy multi-family—well, Houston for the little stuff right now in your B-, C+ type of areas. It’s frankly overinflated. Cap rates are getting way, way too low.

If you want to buy single family, I believe that this is a great time to buy single family in Houston. In fact, that’s what the primary purpose of the fund is. We’re raising $5 million dollars to go off and buy single family property here in Houston to hold long-term. So yeah.

David: So tell us, Sam, what can you expect if I want to move out to Houston and start buying single family homes? How low of an ARV can I get? What kind of repairs am I going to be looking for? What’s my price to rent ratio?

Sam: What I love about Houston is it really just depends on what you want to do and I could literally and have literally taught classes on how to buy for long-term, whether you want to buy for cash flow or you buy for appreciation. I know in my own portfolio, I made more money on appreciate than I ever made on cash flow. And I’ve got people that come in and buy properties from us. They’ll buy a house built in 2008 at 95 cents to the dollar. However, when you get older, some people—the houses get older and they want to see more cash flow. They want to see that equity spread there.

And so, I see equity spreads. We sell equity spreads anywhere between, for flips, 70-80% for buy-and-hold. 75-95%. It really just depends. I mean, it’s funny because my portfolio that I have on my rental property is all stuff that we couldn’t sell. That other people said they couldn’t make money on. And however, at one point, my rental portfolio was returning a 60% annualized ROI. That’s from buying the scraps that other people didn’t want. So I believe that exactly what you see in the market just depends on what your goals are. Because there’s no wrong way to buy property.

I mean, I’m sure you guys buy your rental properties slightly different from one another. It just, what matches up to your goals and understanding what you want to do. It literally—so my partner, he buys rental properties totally different from me, completely different. Him and his partner look at that stuff totally different. However, we both make a crapload of money.

So I think the most important thing you can do is take action, understand exactly what it is that’s important for you. Is it cash flow, is it equity, is it a combination, is it appreciation? Whatever the case is and push forward in that. Just know what your numbers are.

David: So your business is clearly crushing it. You’re doing great. You’ve got these incredible systems put down and you’re only growing. Just out of curiosity, how many hours of sleep do you get a night? How many do you think you need in addition to that? So I love my sleep after reading The Miracle Morning by Hal Elrod, my whole philosophy has changed and I’m curious what yours is?

Sam: So I need to be reading that book because it talks about at the Growth Conference and I’ve actually changed the way I do mornings. I wake up and I work on my goals in the mornings. However, my day, like I told you, I work a lot so I typically roll into the office about 8:30 and then we have our sales meeting at 8:45 and then I work until 5:30, maybe 6:00, maybe 5:00, maybe 4:30, depending on what I have going on.

But then I come home, I eat, and then I go back to work and I sit on the couch and I get on my computer and I work on some of the things that aren’t necessarily task-oriented. Maybe they’re the overreaching goals, quarterly goals, things like that. But I’m still getting seven or eight hours of sleep a night.

I think that one thing that’s suffering is you could probably go back and watch the videos of the previous podcasts versus now. I’m a little fatter. So I think—I’m not working out as much as I want to and by not as much, I mean ever. And so I think that’s kind of suffered a little bit, is that little bit of self-care but I just love it. I mean, who has a job where they can work a 9 to 5, take a break, and then work again 7 to 10 and still wake up every day and do it and love it? I just really enjoy it.

Brandon: Yeah, that’s awesome. Well, you don’t look fatter to me. But you know, I’m not there in the room with you so who knows. All right, so let’s get to the last segment of the show which we lovingly refer to as our Famous Four. All right, so these are the four questions that we ask every guest every week. Having been on the show twice before, this is going to be your third time answering these questions, maybe they’re different answers—maybe not. But let’s get to them. Number one. Sam, what is your favorite real estate related book right now?

Sam: I don’t have one. I’ve been so focused on business and growth and kind of being a coach and a leader for my team and a manager for my team that those books have kind of shifted a little bit. So I’ve actually been reading a few books. I’d like to share them with you. I can talk about those.

Brandon: Are they business books, because that was going to be the next question.

Sam: Okay, let’s talk about it.

Brandon: I’ll let David ask that question.

David: Yeah, so what are your favorite business books?

Sam: Great question. I’m prepared for that one. So I know you guys had Chris Voss on the podcast not too long ago. I love that guy. So I actually have his book right here. It says it right there. So I have his book. This is actually the second time that we’ve read his book. We’ve read his book as a team last year and trained our sales team on the way that he adds value and listening for those unknowns. Those black swans with every seller. And every buyer. And knowing how we can add value to that person. So Chris Voss is one of them.

Brandon: Never Split the Difference?

Sam: Yeah, Chris Voss, Never Split the Difference. Love that book. And then the other book that we actually just picked up is Relentless by Tim Grover. Also an awesome book so far. We’re just a couple of chapters into it but it’s something that our sales team is reading together right now. Yeah.

David: Okay, so when you’re not reading books and you’re not expanding your business, what are some of your hobbies?

Sam: Man, I love cars. I love working on cars. I love racing cars. So everything. I love all of it. I hadn’t worked on something in a while. I used to work as a mechanic on professional race teams and so I used to be able to work on cars all the time but recently, we just bought a house that had a five-car garage and I hadn’t been able to do anything in it yet so I just spur of the moment—I love my wife for this—she let me buy a BMW M3 and a BMW station wagon and make an M3 station wagon. Just in the garage. Because I needed to build something. I really needed it.

So I took the time off between Christmas and New Year’s and thank you to the team for supporting me and letting me take a week off work and build that car. Anytime I can build something, I can work on cars, or I can go race my cars, and then travel in Overland with my wife. I think last time we recorded a podcast was from a library in the middle of nowhere, Colorado, because my wife and I were travelling.

Brandon: Nice.

Sam: And even I think in May, we’re going to go to Iceland and we’re going to camp around Iceland for two weeks and then do our usual long road trip and stuff like that. So that’s really what we love doing. That’s travelling, camping, and then work around cars.

Brandon: That’s awesome. All right, so the last question of the day—what do you believe sets apart successful real estate investors from all those who give up, they fail, or they never get started.

Sam: You’ve got to have a goal. If your goal and your why is bigger than any other problem you can face, you can overcome anything on the planet. And so just understand what is it that just burns deep inside you that says, look, this is what I need. This is way bigger than the thousand dollars I just lost or $100,000 I lost.

Is it the quarter of a million dollars or three quarters of a million dollars I just lost? That goal is bigger than that. So if you can have that why. If you can have that goal that’s bigger than any other problem that you have, there’s nothing that’s going to get in your way.

David: All right. Sam, where can people find out more about you?

Sam: So the best way to get in contact with us is our website, SennaHouseBuyers.com. You can also check out, actually please check out our Facebook page. We post some shorter free content on there, some training and things like that, so like that Facebook page. But if you want to get access to an hour free coaching with me, go to the Facebook page, like the Facebook page, and share it to your own timeline and just take that screen grab and e-mail it to [email protected] and we’ll make sure to get you hooked up for that free hour coaching.

Also, I’ll give you my personal cell phone. Well, yeah, okay. It’s on my website if they want to jump up and look at it but I don’t know if I want to get inundated with it.

Brandon: You probably don’t.

Sam: But I can tell them to give my office number.

Brandon: Sure.

Sam: And actually, I’ll also give you guys this. Let’s give you our office direct number. It’s 713-489-8000. That’s 713-489-8000.  You’ll talk to Liz. If you’ve got any questions or anything like that, feel free to reach out. If you want to get on our buyers’ list, absolutely reach out. Guys, this has been awesome. This has been a ton of fun. I love coming back here.

Brandon: Yeah, this has been awesome. Well thank you so much, Sam. It’s been fantastic. And you know, we’ll see you next time here on the show again.

Sam: Awesome, sounds good.

Brandon: And that was our show with Mr. Sam Craven. That was pretty awesome.

David: Oh yeah. Mind blown. That guy’s business is doing incredible things.

Brandon: Yeah, what was it? 12-15 deals a month? They’re $35,000 a deal—do the math. They’re making massive profits in their business. But you know what I find fascinating is like the same process that he works in his business to get to 12-15 deals a month or whatever that was, like, it’s the same thing that a newbie can do, right? They need to go out there and get leads somehow. We talk about this all the time.

They need to get leads in their business, whether or not you know it’s direct mail marketing, whether or not it’s SEO that he’s talking about, which means like a website, whether or not it’s like Facebook ads, whether or not it’s working with a wholesaler. It doesn’t matter. You get leads and then you’ve got to figure out how much you can pay for them.

So you kind of do some numbers, figure it out, then you go after them and that’s when a lot of people just stop. They go, I don’t know. And then of all the ones you go after, some are going to work out and some are not, but the ones that work out can change your life forever. And again, that can do that with one deal a year or 300 deals a year. I don’t know. The same process works no matter what.

David: And what I love about what Sam said was that he was actually very clear on the fact that you don’t have to have money to do this. You can have time. In fact, as he was talking, what I was thinking is really all money does is replace time when you become more successful and your time matters more to you than what money is. But in the beginning, you don’t have to worry about having money.

His company is spending a million dollars a year in marketing but you don’t need to do that. You just have to have time to get out there and look for deals and time to convert them. You will convert them into money. Then you’ll have more time to spend towards finding deals and eventually you won’t need to use your time because you’ll have money instead.

Really, that’s so, so encouraging for everybody who’s out there that says, well, how can I ever do what he does? You start with just giving your time, learning it, chasing deals like what Brandon said, converting them into leads, learning how to get good at doing that, building up the skillset that surrounds whatever you’re doing, and then just hammering it in once you’ve got it figured out.

You know, Sam talked about how he lost a lot of money trying to do rehabs because that was not his one thing, and then he ended up making a lot more money because he put all that time into wholesaling instead of rehabs. Now he has an incredible wholesaling business.

Don’t be afraid to get out there. Do all the different things you learn about in real estate investing through BiggerPockets and then figure out what do you enjoy the most and what are you best at and then put all your time into that.

Brandon: I love to hear you talk. All right guys, we’ve got to get out of here. Thank you so much for being a part of the BiggerPockets podcast today and we’ll see you around the site for BiggerPockets.com, my name is Brandon.

David: And this is David.

Brandon: Signing off.

You’re listening to BiggerPockets Radio, simplifying real estate for investors, large and small. If you’re here looking to learn about real estate investing without all the hype, you’re in the right place.

Be sure to join the millions of others who have benefited from BiggerPockets.com, your home for real estate investing online.