Finish college or leave for REI?

Finish college or leave for REI?

Member since 2019 · 1 post · 2 votes

Hello all,

I was recently presented with a unique opportunity to get in on the ground floor of a franchised wholesaling company that is arriving in my market for the first time. The company has a track record of success in other markets, and is being brought to my market by a multi-millionaire who has proven prior success in the REI space. REI has been the sole focus of my prospective career path and is what I want to be doing from early in my career until the end. I am still in college (will have 2.5 years completed by the end of this semester) and I essentially get paid to attend the business school of a top 25 university.

My predicament is as follows: The guy who is franchising the company plans to get it off the ground by Jan. 1, has office space leased, and is already bringing people onboard to fill up his team. He knows that I'm a driven individual and that I am knowledgable about real estate, and he's giving me the opportunity to take on a fairly central role within the company should I choose to accept it. But, for the position I would be filling, he wants someone who is able to commit to it 100% and work full-time and thus if I accepted it I would have to leave school. He is willing to give me a minimal base salary to cover basic living expenses and pay for all of my training (including a week-long out-of-state training at the company headquarters), but the job is mostly commission-based. I wouldn't want to work for the company forever, but in talking with the guy about his growth plan and the business model of the company, it pretty much checks all of the boxes for a job I would want for the purpose of gaining valuable fundamental experience with REI. Further, in the last six months I've been battling with feeling like I'm wasting my time in school since my current post-graduation plan was to start as a RE agent anyway (I'm in the process of getting my license while I'm in school) so the timing of this opportunity is strangely convenient.

Any thoughts regarding how I should go about making my decision? What would inform your decision if you were given an opportunity that had the potential to turn into something extremely valuable for your career but you were still in school and couldn't do both? I'm not taking this decision lightly. I obviously don't want to throw away a degree from a very good university, but I also believe that my time already spent in college should be considered a sunk cost when settling on a choice. I do have the ability to defer my enrollment for a semester and I can return to school after that time with my scholarship still intact if need be, but any time longer than that would be considered dropping out.

Thank you for any advice you may be able to provide. I greatly appreciate any and all of it!

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Real Estate Agent · Spokane · Member since 2019 · 17 posts · 16 votes
5y

Hello Ryan,

This is a difficult one to decide on. 

Me personally, I feel leaving for the company would be a great option for a couple reasons.

You said that you could leave school for a time and come back and everything would be fine and it wouldn't be "dropping out". This could be a good back up plan if things just don't pan out.

You want to be a real estate agent and you also mentioned your interest in investing in R.E. later. working in the field of wholesale is a great way to get some experience and capital. The guy who is bringing the franchise to your town would obviously be a great resource for help and possible mentorship, it sounds like he likes you already anyway.

I don't want you to think you are wasting your time at school at all. Education is everything. But you can get your education in more places than one. Unfortunately in order for society to accept your education you have to have that piece of paper from a school saying that you have it. I have never been huge on school, but a lot of people are successful because they went to school. 

Hope this helped some. Best of luck with whichever road you take friend. You have some great opportunities either way.

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  • Real Estate Agent · Spokane · Member since 2019 · 17 posts · 16 votes
    5y

    Hello Ryan,

    This is a difficult one to decide on. 

    Me personally, I feel leaving for the company would be a great option for a couple reasons.

    You said that you could leave school for a time and come back and everything would be fine and it wouldn't be "dropping out". This could be a good back up plan if things just don't pan out.

    You want to be a real estate agent and you also mentioned your interest in investing in R.E. later. working in the field of wholesale is a great way to get some experience and capital. The guy who is bringing the franchise to your town would obviously be a great resource for help and possible mentorship, it sounds like he likes you already anyway.

    I don't want you to think you are wasting your time at school at all. Education is everything. But you can get your education in more places than one. Unfortunately in order for society to accept your education you have to have that piece of paper from a school saying that you have it. I have never been huge on school, but a lot of people are successful because they went to school. 

    Hope this helped some. Best of luck with whichever road you take friend. You have some great opportunities either way.

  • Investor · Waco TX / Conroe, TX · Member since 2017 · 376 posts · 228 votes
    5y

    This is a good one.

    My short answer is to stay in school.

    My long answer:

    You are only 1.5 years away from graduating with a degree that will allow you to obtain a solid w-2 probably making anywhere from 50-70k (maybe more) right off the bat. This will be crucial in your ability to obtain traditional financing and thus very important to you building out your rental portfolio. I am not a huge fan of going full time investor at first, but once you graduate if you want to give it a shot, go for it. You can always fall back on your degree and find many opportunities. Personally, I graduate in December with a Finance degree from a reputable university. I am going to take a couple of months and give the full time RE investing a shot but if it doesn't work out, I can easily go get a job that will pay me 50k, work there for 5-7 years, use my w-2 to finance rental properties, then retire by 35. 

    However, working with this company could help you develop great skills in sourcing off market deals which i think is a great skill to have as an RE Investor. But there are multiple things to take into consideration before you make the jump. For starters, with a commission based job like this, your income is not considered the same as a w-2, which makes it a lot harder to be bankable. You could be making a decent living but because of the inconsistency of your income, a bank will require a longer history of tax returns. There are definitely people out there who make it work and I might be making it seem harder than it actually is but just be sure to think about/research this before you make your final decision.

    Another thing to consider is most companies  like this will make you sign some type of non compete clause. Let me tell you what is going to happen; you are going to go to work for this guy and because you are driven, you are going to do very well. However, soon you will come to the realization that instead of only getting 15-20% (i'm being generous) of the revenue and continuing to make the multi millionaire richer, you could go out on your own and get the whole pie instead of a slice. But this company is not gonna like that their top sales person is leaving and you forgot that you signed that non compete clause that prevents you from operating in that market OR any other market that the wholesaling franchise works in...... bummer! If you decide that you want to go work for this company, be very weary of signing a non-compete and make sure you understand it completely because it might impact you in the future. 

    With all of that being said, non competes can be difficult to up hold but depending on how bad they want to come after you, they can make you hurt. And some people are ok with only having a slice of the pie if they are getting warm leads fed to them all day and don't have any responsibility for overhead, but depending on the type of person you are, some would rather risk it for the biscuit in order to have a bigger cut. 

    In summary:

    I think the ideal situation would be to work for this guy part time as you finish school. If you really want to dive in head first, take the semester off and give it a shot. But just realize if it doesn't work out, it will delay you from jumping in the game by another semester and it might have further implications on your ability to get financing in the future. 

    Did I learn anything practical in College that i can apply to my RE journey? Very little (maybe a class or 2),most of what I have learned has come from Bigger pockets and taking action. But I do realize the weight that my degree carries and it gives me a solid safety net if RE doesn't work out. You are so close to the finish line, you might as well finish. If you drop out now, it will be a lot harder to get started back up again in the future.

  • Jonathan GreeneBusiness Member
    Real Estate Consultant · Madison, NJ · Member since 2016 · 6k+ posts · 7k+ votes
    5y

    I don't even need to read the post after "ground floor of a franchised wholesaling company."

    Stay in school and learn about REI while in school. A franchised wholesale company is not Facebook. Wholesaling is a crap show nationwide, not something to leave college over. There is nothing in what you said that would indicate it's a smart idea to leave college and I am not a proponent of college meaning a lot these days. You are already there, just finish. This isn't the golden ticket.

  • Rental Property Investor · Milwaukee, WI · Member since 2018 · 138 posts · 52 votes
    5y

    @Ryan Winters

    I would echo the voices who have posted here already. Having a college degree, especially one that is not making you go into debt has so much value moving forward. If REI is your passion, there are always opportunities out there. Why not reach out to this owner and negotiate something that still allows you to stay in school?

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