What’s up everyone! Welcome to another episode of Become A Local Leader! On today’s show, we have Benjamin Stoodley, Realtor at Lantzman Management Inc.
Meet Benjamin Stoodley – Our Featured Local Leader!
Ben grew up on a small island called Westport, off the coast of Maine, although Maine is very beautiful and a truly magical place, at 18 he couldn’t wait to get out.
His parents talked to him out of attending college in California due to the distance and increased costs. He landed at Old Dominion University in Norfolk, Virginia. He spent six years living there, receiving his bachelor’s in civil engineering minor in construction engineering tech. Ben went on to complete his master’s studies in structural engineering with a certificate in coastal engineering.
During Ben’s engineering internship, he quickly realized that corporate life wasn’t right for him. All he knew is he wanted more flexibility so he started trying some different things. After receiving his degree in civil engineering, he moved to California in 2011 and has been involved with investment real estate ever since.
Having the experience of working in residential construction as a kid and studying construction engineering in college, the private lending real estate world seems to be a perfect fit for Ben. He’s been involved in hundreds of millions of dollars’ worth of investment real estate transactions and is the principal and CEO of Best Lending Company.
Before committing to the lending company that he is now the CEO of, he was a serial entrepreneur and has experience with the following businesses: landscaping, lobstering, bartending, personal training, home repair, lawn care, membership sales, modelling in commercials, online training, corporate rentals, medical cannabis, and CBD.
What can you say about being called a “serial entrepreneur”?
I am a serial entrepreneur. I think one of my mentors said, “You’re born with it. It’s in your blood.” That’s the best way to put it. I can’t sit still. There are so many businesses, so many ideas, so much to do.
How was the process like for you?
The best way to learn is to just go out and try. Learn as you fail. Never be scared to fail because that’s the best lesson, the best teacher. As long as you can learn from it, move forward. That’s all you got to do.
Why do you live in San Diego?
That’s a good question. I’ve always wanted to live in San Diego. My entire life, for as long back as I can remember. I can remember being at the dinner table with my family and talking about things. My uncle always has stories of San Diego. He lived out here in the 70s. But other than that, I have nothing to point it to. I’ve just always had this weird internal drive to live in San Diego. I don’t even remember seeing it on TV or anything because, I mean, I only had three channels growing up and we watched Seinfeld and friends, and that was it. So yeah, I don’t know where the drive came from. But like I said, for at least 25 years out of the 33 I’ve been alive, I’ve wanted to live in San Diego.
As soon as I graduated from college, I tried talking to friends into moving out here with me. It’s hard for people to move out of their hometowns. I found that to be very true. So, I just kind of stopped relying on friends. But one of my best friends from college, Thomas, came out with me, just to do the drive and experience a vacation from work. Then he flew back and that made it a little bit easier. I just packed up and came out here in 2011..
In terms of San Diego, why do you love the community that you live in San Diego?
It was this magical place in my head as a kid. And so, I knew I had to try it out.
When I was a bartender in college, I had the opportunity to talk to hundreds and hundreds of people, as you might imagine. I did it for four years or something. Especially before it gets busy at nighttime, you got to entertain these guys and you got to talk. I always talk about moving to San Diego. That was my go-to. A lot of people at the bar were travellers. Some are older and they’ve done a lot in their life. Many people had opinions of San Diego and I swear I never ran into a bad one.
I went through a lot of struggles when I first moved here but the weather, and the beauty, the landscape. are amazing. The sun gives me energy. I can go outside 350 days a year and get sun. That’s not much of an exaggeration. The first couple of years I lived here, it never rained. It was very weird. We needed the rain. We’re in a huge drought. But it also doesn’t get to be hotter than 90 degrees and no colder than 50-45. It was very temperate. It’s not tropical but it’s extremely temperate, and I’m a very warm body person so I like it to be not super humid, like it is on the East Coast, especially in Virginia and the south where I spent some time when I was younger.
So, I was drawn to the weather and the beauty of the landscape, the mystery I made up in my head. Or society did. And the money, you know. I grew up in a very opposite corner of the country and the opposite end of the spectrum as it relates to money. We weren’t poor by any means but we’re just a normal middle class and everything around was very three-bedroom-two-bath, hundred thousand or hundred fifty thousand-dollar homes. And then in San Diego, everything’s a million dollars, even if it’s just a shed. San Francisco and LA are even worse or better, depends on your perception.
It was very exciting to me. I would go on runs not knowing what I’m going to do in my life before I got into real estate. I would just run along the coast and see all the mansions, and just be like, “First of all, no one even lives here”. These are like second, third, fourth homes for these people. They don’t even live here for most of the year. They are travelling for their business, making their millions.
And so, I really had a huge coming to or eye-opening experience just living in San Diego for the first time. I never had visited really. I came out for two days once. I pretty much just went to the bar and got drunk and went home. It’s not a good idea of what San Diego had to offer. I was completely new living here. I didn’t know anyone. It just had this energy. I just had this energy from being there.
The people are extremely nice. Pretty much, anyone’s a friend. The depth of that friendship is can be questionable, it depends on the person. But everyone’s very friendly and very easy to get along with. They have a very fit lifestyle. It’s very entrepreneurial. I just fit in really well. As hard as it was and with as many struggles I had at the beginning, I always knew that it was the right choice. I’ve loved every second of my nine years being here.
In terms of your business, do you work in the same community where you focus your business or do you work in one area and then live in another area?
Actually, all of my work is now completely remote. Ironically, I had my broker’s license so I focus on hard money, but I do have my brokers’ real estate license so I sometimes represent friends and referrals. We just closed escrow yesterday for a referral of mine. So, thank you Danielle for referring me!
It was a crazy process. The market right now is super intense here. But that aside, I might do that a couple of times a year. But all of my focus and time go to hard money and that’s completely remote.
I actually haven’t even done alone in San Diego in like six months or something. I wish I had more year for sure, but it’s very competitive here. I have a lot of business from the past seven or eight years and it’s all just been spread out through California, West Coast, and now it’s kind of sprinkling into a few other places across the country.
That’s happened as the companies I’ve worked with, in the past, have opened their lending guidelines. So, my obvious outreach head kind of spread across the country, not just the state. Now, with my current business, I’m lending in 10ish states.
My work is completely remote. I work from home. I have for three and a half years or so. Will probably be getting an office here soon. I just launched my own company. And then with COVID, I got delayed three months. So, we really just got going last month. Regardless of the office being located in San Diego, very few of my clients are here.
It’s kind of weird, I guess, compared to typical real estate sales where it’s all in your community. It’s very different in that regard. But at the same time, I would love for all my business to be in San Diego. That would be ideal. It’s just that in my experience as an investor, that’s not the best way to invest. It’s a little bit different of a ball game.
Can you explain based on your experience why it’s not the best way to invest in just one community?
As a real estate agent, I think it’s a great and absolutely fantastic market because it’s red hot. The downturns are very limited. The risk is very limited. The prices are very high. Your commissions are going to be high as an agent. It’s a great market through and through. I like to invest here in San Diego. I love San Diego loans/flips. That is typically what I do. But the investing market here in San Diego is very competitive.
Four or five years ago, there were hundreds and hundreds of investors and tons of inventory and lots of competition but there was a lot of fish in the sea. And so, it was a great time. Rates are higher. Everything was crazy. Houses were getting a hundred offers. It was just crazy. That was a good time.
But then, inventory started to dry up and lending got more and more competitive because as institutions saw the real estate investors and the opportunity in the investment side of the market, this pretty niche end of real estate and they all jumped in. That was maybe five or six years ago. Now they had a big part of the pie because they run hedge funds of billions of dollars. But they brought the money expense of hard money down. So, the rates were falling for hard money from 12% to 14% on average to 8% to 9% average pre-COVID, so just a few months ago.
I know last year the average is 9% for the company I was with. And then, it could be as low as eight and a half pre-COVID. It was just very competitive. That part of the rate adjustment is based on the market. And so, the more competitive markets, aka the more markets with more borrowers and therefore more lenders have the cheaper rates. So, your return on money as a lender is lower just based on that in San Diego. But then, additionally, there are higher-priced properties, which are good. But it’s lower margins because there’s lower inventory, a result of it being so busy for so many years leading up to now.
So, there are other markets I’ve worked with my investors in. My clients from 2014 and 2015, have gone into Arizona, Texas, Florida and the Mid-Atlantic. After a few months of learning the market and going in there with someone you trust who’s also done their due diligence, there’s better margins. They are lower prices which you just got to do a few more loans but they’re better margin. Your money is more secure. Your investors, your borrowers, your clients, they’re doing more business. The agents are busier. So, it’s kind of a win-win in a lot of ways. It all depends on the way you look at it, I guess. But in terms of investor, hard money, I like being spread out in a few different markets. I think San Diego’s a fantastic market. I love to have more loans here, but it is really smart to have diversification. You can’t know every market. Unless you have the manpower to have boots on the ground in every market, then you are kind of limited by what you can really understand and comprehend.
As a pretty small private lender myself, I’m kind of kept with what I can feel comfortable lending in which markets. That’s where I work with my clients as they do their due diligence. They keep me posted. We learn together. I talk with other lenders. It’s a process. I don’t add on many markets just out of the blue. It takes a long time before I’m willing to move into another market. Those are the reasons why it’s different as an investor. And all my work is remote for that reason.
Can you give us a sense of your current volume?
COVID really changed everything. To give you a rundown of what it usually looks like, typically, there’s anywhere between 8 and 14 loans that we do a month. When I was with my partners at a different firm last year, we did 71 million in the year.
When I left to start my own business (I left in March). And so, COVID quarantine started right then. My business was on hold for two and a half months. I kind of re-started in June. I’ve got about five loans in the queue right now. It is a lot faster than I actually thought it would. I was planning on doing about two loans my first month. I’m on about week four, and I’ve got about five loans ready to close right now.
It’s a big market shift that COVID already changed. So, with investment real estate, it’s completely private. I’m retail. In San Diego, I haven’t seen prices change at all. In some areas, they are still going up. It’s crazy. But on investment real estate, we’re not regulated by the banks and the fed. So, if we see danger in the future, we can just pull back our lending or increase our rates, change our LTVs overnight.
During COVID, like maybe let’s say April, the lenders that were out there were doing 14 – 15% because there was so much on loan. And then it came down from there and it’s kind of leveled out now. We had a big adjustment phase throughout COVID because all the investors don’t know if they should buy so they were on the sidelines extending their escrows. All the lenders don’t know if they want to lead. They were saying, “Well, if we’re going to lend, then I’m going to do 50% LTV rather than 65% LTV. And instead of eight and a half percent, I’m going to charge you 14% or 12%” or something like that. That happened overnight and it’s kind of calm down a lot now to where rates are around 10 and two, and before were kind of let’s say 9 and two. So, they went up a good percent probably a percent and a half on average, I’d say. There’s definitely a big range out there. Some institutions and lenders are still not lending in the private world. Maybe that’s part of the reason my business got moving so fast, is because I’m actually lending.
That’s kind of what’s going on right now in terms of volume. I’ve got five deals. I’m ready to close one this week and all four next week.
In terms of lending rates, what’s your medium lending rate?
Right now, we’re charging on average about 10%. Well, that’s for our experienced clients. A lot of the interest rate depends on your experience as an investor. All of my borrowers are flipping homes or buying them to hold as rentals. Either way they’re usually quite dilapidated or in need of renovation. Banks won’t lend on them, right? So, they don’t really have a choice. Ninety percent of the time we can close in a couple of days. It’s all short-term stuff. It’s very easy for them to get the loan if they have experienced and they know what they’re doing. It’s like a phone call and we’ll close in a couple of days, type of thing. That’s why the rate is what it is.
I think I already mentioned, but just five or six years ago, the rates were 12 to 14%. The fact that experienced guys can get to 10% right now with what’s going on out there is pretty good, in my opinion. Newer guys, first-timers, they might be looking more like 12% – 13% depending on the deal and their credit and stuff like that. The range is kind of between nine and a half and 13 right now.
In terms of business, what percentage of new business would you say is from relationships versus referrals versus advertising?
Prior to COVID where all my data would stem from, I would say 95% is either repeat clients or referrals of those repeat clients. I would say 75 to 80% are clients I had worked with already.
That’s been my goal with the launch of my company is to really provide a service for not hundreds of thousands of clients, but honestly, but smaller numbers that are doing big business. That’s the goal. That doesn’t mean I won’t work with you if you’re not doing this in a big way, by any means. It’s just there’s a lot of people that get in this for the wrong reason and I think that there’s some opportunity to clean up the industry right now. I’ve seen the wave lending was going on prior to COVID. Just like what caused the ‘08 – ‘09 crash on the financial markets, you know, the mortgages on the conventional side. Lenders are doing the same thing. So, I think there needs to be a little bit more regulation in the market right now. So, I think this is good. That’s kind of helping everything. Yeah, that’s the goal.
How would you say you create new relationships right now?
Once again, COVID changed everything. It’s kind of funny. I remember when I first got into hard money. I would spend all day and all night on my computer, on LinkedIn, on Facebook, in the groups reaching out all electronically every week when I first got into hard money. That’s how I grew my book of business. Once I got my clients, my book of business is really large and continued to provide them with good service. It was just all referral base from there.
But now with COVID changing so much of the industry and so many of my clients still sitting out for completely understandable reasons, I have decided to start reaching out more. And so, I’m back on LinkedIn. Not as much Facebook anymore but working out of bigger pockets and groups.
The electronic side of what we can do is communication and marketing now. It’s a complete one to one payoff. If you put the time in, you’ll get results. If you reach out on LinkedIn and these websites and you always put yourself out there, you will get new clients
So, that’s how I originally built it. And then, it went to mostly referrals. But I also spent a lot of time going to local networking groups. I think from where I’m located in San Diego, given all those reasons at the beginning of this conversation, that just didn’t have the same return in my experience. I didn’t get as much of a return from the local meetups as I did from the amount of time, I could spend online reaching out to people. I could just cover a larger number of people.
But at the end of the day, this is a relationship business. And that’s the same with all real estate, right? And so, no matter how you get your client, it’s going to come down to the relationship. You need to be able to talk to your person at least on the phone, if not face to face. They need to be able to trust you. Transparency and communication, that’s what’s going to build your business long term.
That’s what I rely on most is, you know, treating my clients right and keeping them long term. It’s always about client retention, not acquisition.
The referrals are where it’s at. If you do good business and you really care about your clients, then they’re going to refer you. That couldn’t be any more true as a real estate agent too. You can go online with all the different real estate websites – Redfin, Zillow, and all the zillion others, and the brokerages who spend billions of dollars advertising but what it comes down to as an agent is you got to do good work and people will refer you. Everyone’s going to buy a house. They have to. What they’re going to do is they’re going to type in real estate agents in Google and be way too overwhelmed on how they are going to pick and then they’re going to ask their neighbor or their friend and they’re going to go with a referral. Always. That’s why relationships are important. All businesses are done with people. Business can’t be done without people and so you got to have those relationships.
Do you have any relationships with other business owners who refer your business or is it mainly through your client base that you tap into?
I think there’s definitely a pretty large referral base from B2B. Brokers in our industry are quite prevalent. They do a lot of business, especially pre-2017 when rates start to fall. It probably got a little bit more difficult for them. But as a broker, you have a great opportunity to make tons of money by just referring business to different lenders by getting a commission for it. In some states, you don’t even have to be licensed as a hard money broker. So yeah, it’s weird. It’s different laws in every state.
Anyways, brokers bring in a lot of business. I’ve had some brokers that refer me a deal a month or two. That keeps me really busy, just that one client, broker. And then other lenders, private lending has really exploded over the last five years. I’ve been really impressed with the number of conferences and the level of camaraderie between the lenders, the private lenders and money lenders. I feel like it’s been a very friendly business industry where people are really happy to refer business to the right lender. Not every lender sees the same things or likes the same things. It really comes down to cash flow too. They all fund their deals differently. And so, the timing of the deal is really important. I encourage all my borrowers to have multiple lenders. Things come up. You never know. Just because I pass on a deal doesn’t mean it’s a bad deal. I just may not be the right one for you right now. That’s what makes it hard for some borrowers, for sure. We try not to do that a lot. At the same time, investing is subjective. And so, you have to be open to that. That’s investing. It’s good for borrowers to have multiple lenders and it’s good for lenders to have multiple lenders.
We all see things differently. We all have appetites for different loans, different deals. So, yeah. I definitely have a large percentage of those referrals. I’d say probably 50% of my referrals. 25% to 50% of my referrals come from B2B.
In terms of marketing, how do you determine what you’re going to spend on marketing? What does your budget look like for marketing?
It’s been very low overhead, which has been a very great blessing to have. But that comes back to what we were saying, bringing pride in your customer service is the best payoff. Putting in the extra time on the phone and into the projects and quality work, that time is investment in your clients. That is much more important to me.
Right now, my marketing budget is in trial mode. I’m just launching last month. What I did is I put $2,000 towards like 10 different sources or five different sources. $2,000 I think it was. We’re just doing five different ads on five different sources for this next month. We’re just going to try to just kind of see what works best.
We don’t really want a huge influx of business right now. You can test trial so many different Facebook ads, LinkedIn ads, Bigger Pockets, any site, you know, Zillow, Redfin, anything that applies to your industry, you always got try it first. And so, even though I’ve had a lot of experience with some of these, I still now have a new brand. And the brand itself just launched. And so, I’m not too worried about conversion, as I am more so with brand awareness, because I have enough business just kind of come in with me organically.
My marketing right now is pretty low. I expect it to be close to double that next year. That’s also in part because of the way I structure my business, which is a little bit different than some lenders, I think. I’m putting more money into marketing versus hiring a lot of loan originators and salespeople.
So, because of that, I have a higher marketing budget. Right now, it’s pretty much just diversified across all the platforms. So, all the social media is having my marketing team just posting three to five times a week on all the mediums that I know convert. So, Instagram, LinkedIn, and Facebook. I’ve never had a real experience with Twitter like converting on my industry, but I’ve also been very bad with Twitter, personally. I haven’t put in enough time. I know it’s valuable. Same thing with YouTube. I mean video kills. I just haven’t put in the time personally but I know it works. I do the ones I know and can understand. My partner handles the marketing now, so he’s kind of setting up all the technical backend of having it all, not only match branding, but also being plugged in on to our CRM. That’s the most important so you can track where all the leads came from and then do your analysis. But yeah, we really just launched the marketing last week to be honest. Before that we were just emailing my clients to let them know that we’re open.
So, it’s a funny time in the industry right now to answer these questions. In the past it was a little bit less. We probably did about $1,000 a month. We really promoted events that we were going to hold. I had a really good campaign set up for a capital raising I did, where I did Facebook ads about an eBook. And the eBook was all about real estate investing passively and your options there. And then, if you want more information to enter email and then you get put into a drip campaign. This is all automatically done. You put it in to the CRM and these people get follow up emails and schedule call with me. I have really well vetted clients by the time I’m on the phone.
And so, those are the type of systems I really like. I also had a VA go through and handle and manage my LinkedIn. Not the ads and the business stuff, but my personal LinkedIn. I think I had like 9000 connections on LinkedIn from the year so I have a wealth of business go through there. I just had my VA reach out to all the people in my industry and send a welcome message. And then, depending on their response, she would either be able to respond another one or two times depending on the scripts that we had set up. And then, kind of give me a weekly breakdown.
And so, that was really cool too. I kind of have my business on autopilot at that time. I was traveling. I remember being in Bali during that. Just having my LinkedIn messages going through and then I was able to just pick out the one that made sense, one or two, rather than the 40 messages from the week, maybe 50 messages from the week. So, it was well worth the money to have some human do that rather than automation. I think SEO and ads targeting is where you put your money. But then there’s also, because of the relationship stuff we talked about, there has to be some human hours and non-computer algorithms. So yeah, a VA. I’ve had her for three or four years now. She’s kind of been on pause for the last six months just due to coronavirus and everything. We launched into business and whatnot but that was one of the best marketing campaigns I had was just having her do that. That worked wonders.
How do you feel about travelling to Bali?
Bali is amazing. I traveled in five different countries during that time and Bali was by far my favorite. It’s the only place that I could feel I could live.
I traveled to two places outside of the United States where I’ve had that feeling. Puerto Rico, which ironically, I’m very highly considering moving to, and Bali. Bali is the best energy I’ve ever felt. It really talks to a lot of San Diego people, I think, because of all the surf and beach communities and just that whole beach vibe. But then it also is very entrepreneurial. It has a little bit of westernization in some areas. And so, you’re able to go to a cafe and get any type of food and have Wi-Fi, meet people from all over the world, especially Europe, and they all are on their computers working, doing their thing. It’s really, really, really cool. I loved it.
In terms of plans, what would you say your goals are for the future in your business and personally?
I’m a big believer in goal setting. I’m very OCD with my organization between to-do lists, my calendar, having an accountability partner. I have my whiteboard. I have my notes. I use notes in my phone. I use all of those. I’m also a minimalist so I tried to use as few things as possible and I still use that many. That is all because I think you need that much to make goals come true. Writing them down is true. Yes, you have to write it down. But I just wanted to emphasize the amount of writing down I do just to make my daily goals come true, let alone my five-year goals. I’m a huge believer in that. I write a lot of blogs. I talk a lot in podcasts about just that. I’m very efficiently driven. Tim Ferriss is my idol. It all kind of makes sense with kind of the OCD spreadsheet stuff.
So, goals, I don’t really do New Year’s goals so much. I kind of would journal. I’ll probably put them in my journal just to kind of do it for fun. I think setting goals is a daily thing. I mean, just like a business plan. Your business plan changes every day but you also need it. Once you write it down, it becomes true. That’s why they say write it down.
You have to write it down, not only in your journal once a year, or in a piece of paper, or your mirror, or whatever. You have to write it down every day. What you write down every day doesn’t have to be that goal, but it has to be the steps on how do you get that goal. You have to plan it out.
That’s what I’ve come to the conclusion after setting many annual goals that never really came true or came true after many years when they’re supposed to be a one-year goal. If you are so bad at predicting the future that it doesn’t make sense to plan goals in a year.
I read this book called “The 12-week year” and that probably put the shift into my goal setting time period. It really just kind of hits home with annual goals make no sense. Plan for the next 12 weeks. That’s kind of humanly possible. Trips and big events, sure. You can say, “Yeah, I’m going to go here this time.” That’s the best way to plan them so that they actually happen. But in terms of business or anything that you can’t control like everything else, you can’t control a year in the future. You just can’t do it.
I have a five-year goal. I have a five-year plan. I have a 10-year plan. I have lots and lots of ideas, as you might imagine, from the beginning of this conversation. Business ideas, living ideas, you name it. Nonprofit ideas, leadership ideas, education ideas, everything. I’m very aware of the priority of things that need to happen. Most of my goals are within that kind of 12-week period, which I can control.
I kind of mentioned earlier, my goal was to do two loans in the first month. Depending on how you look at it, I either got zero or five. But either way, I’m perfectly on track. I feel really, really good about that kind of 30-day and looking like 60-day track in terms of business. I can’t control the five-year or 10-year goal, but my projections are to be doing about 200 loans, a year at that point. That’s very doable. Ten loans a month is super easy. Doubling that with the right structure, which I’ve already planned out a million times, I think is going to be very, very doable. I think it is very conservative number. Two hundred or 250 a year, and to be doing about 70 to 100 million total per year in loans.
I’ve already hit that with my past partners. I know these goals are very obtainable. But I think that’s a big part of goal setting. You got to make them. I mean those are my projections. Those are my business projections. My goals as a person may sound more like your moonshot goals. I want to change education, the entire system. But in America, it’s terrible. I think we’re teaching zero of what needs to be taught. I think the entire government system has been put on blast for the last four years, for obvious reasons. And that’s great because we need to completely change it. I think the whole system needs to be torn down and reframed but that’s a huge goal. That’s probably like a 200-year goal. Hey, it’s one of mine. I know that I need to get my business to a place where I have the ability to do certain things. And so, my business is at the top priority. Another thing that’s higher than business is your health and your family. And so, those are where I set my realistic goals or my 30-60-90, 5-10-year goals that you can actually structure and plan.
I’m building a family. It’s just me and my girlfriend and two dogs now but we have really great plans for her, and for the dogs, and for us. Our living situation, like I said, we are considering moving to Puerto Rico, all these different things are way more important than business goals. Those are scheduled first in my calendar. They are journaled about daily and meditated about.
That’s how I set my goals. I have my big ambitions. Those large things that I think interested me when we talked initially about what you do and what you’re interviewing about is the big change, like leaving the world a better place. I believe that every entrepreneur is kind of required to give back to the community and to the world. You can’t change the world without changing and community. It’s kind of all the same thing. You can’t change anyone else without changing yourself too.
I went through that process four or five years ago. At 28, I really ground down on myself and changed myself. You kind of get to this level as you go through life. Those big goals, I know I’ll hit but I have no idea where and when so I don’t have any plan for that. They’re written down on paper as changing the government, changing the education system, those sorts of things. I know I’ll continue to work towards it, but they’re so big that I can’t really even fathom it yet. That’s the long answer.
How important is journaling for you?
I believe in journaling. I’ve had various multiple instances, really big life-changing instances over the last, let’s say, four years where I had it click until I re-read my journals from an earlier me. I realized things that had been going on for way longer than I remembered. So, the severity of issues was right there in front of me. That’s a bad example. But also, on the good side, I realize I live in the life I used to journal about five years ago. You don’t really know if you’re hitting your goals unless you write them down and you record them. And so, the big goals that seem impossible, you can’t plan for them. All you can do is plan for the year, plan for the four months and keep taking one step at a time every day really is what it comes down to. Track your progress. Look back. Do the best you can. Try to improve. You’ll get there.
Do you buy leads from Facebook ads?
In the past, I have put money into Facebook ads. They get leads. I don’t know if that’s the same thing.
Do you get somebody to generate leads for you through Facebook ads or other social media ads or do you produce your own?
Produce my own.
Do you produce your own Facebook ads?
Facebook ads, LinkedIn ads, all multimedia ads, yeah.
Do you have any other sources?
For paid marketing, no. That’s it.
How about retargeting?
None at the moment. No. I believe in retargeting. I think it sounds good and seems good to me from a logical point of view… it’s the best bang for your buck. Retargeting makes a lot of sense to me.
Do you pay anybody to do your social media for you?
I have in the past. I do not right now. My partner is going to be handling all the marketing for the company. We will most likely be automating as much as possible. I think there are certain components of it that need to be human-driven. That will either continue to come from me or VA. I do think that Bigger Pockets, for example, it’s a very tight-knit community even though it’s huge now. It’s a lot about feedback and blog/forum posts. And so, my responses are very important to me for me. Just like my blogs are important to be from me. There’s a certain piece of it that I always want to keep completely mine and just will not ever sub out.
In terms of bus benches, grocery carts, display advertising. Do you do any of those?
What about direct mailers? Flyers, door hangers, other forms of print marketing.
I have in the past. I do not think it’s worth it anymore. I’m an investor finance guy, numbers guy. Everything just comes down to the ROI. At least on my industry on investing, finding houses to flip, or finding borrowers to lend to, it has not returned the amount. It’s just not a good return on your money. It’s way more expensive to reach way less people. And the conversion is not high enough to make up for that by any means, based on my experience. It’s different in every market, in every segment of real estate, and everything. I think it all comes down to what I said earlier of like you got to try everything at the beginning. My business is different from every other lending business which is different from every real estate agent, and every broker, and every lender, everything. You got to try it. You’ll never know what works best for you. Try it smartly and track it so you know what gives you the best returns.
Social media ads and email marketing is where all my marketing dollars go.
In terms of email marketing, do you do a newsletter?
Once a month.
In terms of following up and working your database, can you give us an idea if you do the following:
Close to zero. Because of my remote working all over the country. So very, very little face to face. I’ve only met a few of my borrowers or my clients.
Writing personal notes.
I need to do that more. Thanks for the reminder. I’ve done it once.
Yeah, we do Christmas gifts last year with the company I was a part of. I plan to do a client appreciation for my new business here. So, yeah. I plan to give back as much as I can to the clients and do some sort of appreciation. I just got to check what is allowed legally.
How often do you call, text, or DM your clients?
I would say it’s just the emails. Unless I am in a transaction or in underwriting preliminary to a transaction, then I wouldn’t be doing anything more than email most likely. It’s rare that I do call follow-ups. I have done a lot in the past. I used to try to do 100 a week. That was effective. And once again, the return for my money wasn’t really that great but it’s a relationship business. So, bottom line, if you can’t make anything else work, that is 1,000% what you should be doing is calling. I did that more a few months ago when I was launching. I called a lot of my closer clients. But yeah, I don’t call just to touch base as much as I should. Only a few clients.
Do you cold call?
I do not a cold call. I did. When I had my first company, I did a cold calling campaign that my colleague and I set up and it was a really fantastic campaign. We were able to find borrowers that we’re currently borrowing from other lenders so we knew that they were active. We would scrape the internet to find their info. We would get their contact info and I would go cold call them every day. I do 20 every morning. So yeah, that hundred a week has been my KPI to follow. It works, hands down. Twenty every morning was my routine. It worked. At a certain point, at least in the past, I got so busy with my days by handling the transactions and going through my other work of active deals that I didn’t have time to make the calls. That’s where scaling comes in. When I was doing that, I wasn’t running my own business so I can’t really scale as easy. I was a loan originator.
Final thoughts. What would you say to real estate professionals out there who want to become recognized as a local leader, market expert or the go-to person in the industry? What would you say to them?
Nothing’s ever going to beat credibility. It’s very hard to get started in any business because of that. That’s why people require experience, which is another topic, but credibility always wins. Once you put your time in, things get easier. Keep that in mind.
But at the beginning, there’s no wrong way to do it. You just got to get out there and make sure your name is in everyone’s mouth.
A lot of people believe any publicity is good publicity. I don’t believe that. But there’s been plenty of people who have done well. They had made money doing that. That’s another topic. In my experience, you just got to get out there. You got to do it locally, even if you don’t do any business like I do. I went to a meetup at least once a week. To have a name, I went to the Chamber of Commerce, stuff like that. Things that weren’t just real estate but any business-related, business owner/entrepreneur government, that type of stuff. Shake hands, meet people, learn as much as you can from the older people that have done it before you. Like I said, credibility and experience is everything. And so, learn, learn, learn because that’s what will get you the credibility. Credibility will take you through the roof.
As far as marketing goes just cover it. Try every single segment. Pay special attention to the returns and you can track it all. I think social media has been extremely useful for the real estate industry.
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